When you have people who want to buy things but can’t, and shopkeepers who want to sell things but can’t, economists call this situation “a lack of liquidity.”

Most people would naturally think the transaction fails to occur simply because the people who want to buy things don’t have enough money. But there is no natural reason for anyone to lack money. It costs virtually nothing to create money, regardless of the value printed on it. In fact, if you don’t use paper cash at all but rather electronic debit cards, it really does cost nothing—what is the price for making an electronic pulse?

You only need to create money (out of thin air, really, by putting numbers into accounts) and distribute it to those who lack it. Voila. Now those who lack for the necessities of life can buy them, and those who want to sell things can do so too, just by the act of our creating money and distributing it to those who need it.

I’ve just solved poverty. But wait, there’s more.

There are two main reasons why the federal government-owned Bank of Canada does not do this, even though two of the core responsibilities of government are to ensure every Canadian can buy the necessities of life, and seeing that the commercial enterprises of the land flourish. One is the moral dilemma of giving some people money who don’t do those activities deemed by our social conventions to entitle them to money, like working, inheriting, or investing.

The other problem is, if you create all the money necessary to ensure everyone can buy what they need, you devalue the worth of each individual unit of that money, thereby making poorer those who have money, even as you make richer those who don’t. Those with money don’t like that idea very much, even though that has long been the primary function of the universally accepted income tax, which is far more draconian and far more intrusive in personal lives than impersonal and non-discriminating inflation would be.

Let’s ignore the first point altogether, for aren’t we past the age of paralyzing moral quandaries? In Vancouver, at least, we already generally accept the proposition that the addictive consumption of illicit drugs, for example, is a medical, not a legal, matter, and that distribution of drugs or drug-consumption services should be divorced from any moral judgments about the taking of drugs. The same liberal relaxation of moral judgment should be applied to the distribution of subsistence levels of money. We should not inquire into why someone doesn’t have enough money for basics, just as we don’t inquire into why they take drugs, all we care about now is that they need those drugs (or some substitute), just as they need that money: everyone who needs either should get both, and there should be no withholding based only on why they lack it.

On the second point, however, there is no negotiation. The large companies and banks own all the major federal political parties, and inflation—that is, the monetary redistribution of wealth from the rich to the poor—is anathema to the corporate class. They only grudgingly support the fiscal alternative—a graduated income tax—because that method of redistribution offers far more levers of social control, like moral judgment, for example. We can just forget about printing real cash money to help the poor and inflating the wealth of the currency out among social classes more evenly: it will never happen.

But what if a more minor jurisdiction like The City of Vancouver, which is not so heavily dominated by so organized a corporate power base as the federal government is, were to create and distribute its own quasi money? I am not suggesting the City create and distribute wealth, which is a whole different thing, and an act no one with wealth would ever support, and nor could the City effectively create wealth or collect enough of it to distribute anyway. But money is not wealth. Think of recreational poker players: they could sit there and not play a game because they have no chips, or they could just as easily go get a box of 500 chips, supply every player with a hundred chips at the start of the game, and enjoy themselves playing poker trying to win each other’s chips. To supply chips to a poker game is to provide liquidity to it. No wealth is being distributed to the players, just worthless pieces of plastic. Yet, as a result of this distribution, they all get to play, where they weren’t able to play before.

This is the proposal I am making for the City of Vancouver: supply everyone in the city with the equivalent of poker chips. Just as the plastic poker chips at the Friday night poker game in actuality have no real value to them, so too would City of Vancouver money have no real value to it either. All that’s required is that people wish to get them—that they wish to play the game. The only critical rule necessary is that only The City is allowed to create and distribute new chips. (Otherwise, there is no game if anyone can manufacture their own to limitless amounts.)

Here is what we could do: give every citizen 1,000 City of Vancouver ducats (let’s call them) every month—but electronically instead of using paper, just to keep the system as cheap and easy as possible: issue everyone a special debit card. Any retailer who wishes to compete to get those ducats can have their already-existing electronic terminal programmed to read the cards and to transfer ducats from someone’s card to their own ducat account. The retailer can then use those earned ducats to spend at some other business that accepts ducats—perhaps a restaurant down the street?

To keep the system flowing with plenty of ducats, everyone’s account would be credited with a fresh supply of 1,000 ducats each month. To keep the system from over-inflating and reducing the value of ducats to nothing, all accounts are automatically reduced every day by 3.3%. In other words, if you hoard your 1,000 ducats, by the end of the month, you will have no ducats left. You have to spend them or lose them. Of course, if you are uninterested in this whole scheme, that’s fine too. Throw your card away and ignore it. No ducats will accumulate in your account, whether you spend them all or spend none. But if there were a bunch of people who don’t have enough money, but have a lot of ducats to spend, would a retailer really turn them all away? Let the retailers themselves figure out how much in ducats to charge for a loaf of bread. If they don’t wish to sell for ducats, customers wishing to spend ducats will go to another store. If he offers bread for too many ducats, they will go elsewhere too, and if he sells for too few ducats, he will do himself harm. Let the market freely decide.

Then, if there are retailers willing to accept ducats for goods or services, why would a citizen ignore the thousand ducats they get every month on that card? Why let them deduct away unused?

In order to serve broader community interests, the City could restrict retail and service ducat accounts only to local, small businesses. Someone could even set up a small business, if they like, in which they offer real money in exchange for ducats, at whatever rate of exchange they deem worthwhile to themselves. That way, even those businesses with too many ducats coming in, making it hard for them to pay cash for the things they need from outside the system, like supplies from elsewhere in the country, can still get them exchanged for the cash they need.

The whole scheme costs virtually nothing: the City isn’t distributing wealth, just a medium of exchange. Also, we don’t have to judge people’s worth to society before giving them ducats the way more senior levels of government deny money to those who won’t work. We won’t care if anyone works or not, we just want them to buy things with the ducats. And we furthermore don’t have to worry about the whole system becoming bogged down with speculators and hoarders, since the value of a ducat account decreases sharply over time, discouraging anyone from hoarding ducats or speculating on their future value. And we also don’t have to worry about class calcification setting in. A whole new supply of ducats is created and redistributed every month, and each month’s ducats expire by the end of the month. Everyone is equally wealthy (in ducats) from the first of each month (just like all hockey teams are tied for first at the beginning of a new season).

The only remaining problem is taxation: the senior levels of government collect taxes on any transaction, and they want their dollars. The solution? Rely on businesses to do their own reporting, and to pay their own taxes, as usual, and we can count on them to include in their pricing considerations room to cover their tax obligations.

As far as personal income tax goes, again, let everyone be responsible for their own reporting. Since the ducats become quickly worthless if not used, income in ducats is only measured by what you consume with ducats. Add up the value of what you purchased, and there’s your income. Take into consideration the taxes you’ll owe when you decide how many ducats you’re wiling to pay for a loaf of bread: the market will always determine what is fair.

The beauty of this system is, no one, neither a citizen nor a business, is compelled in any way to bother with the system at all. It is completely voluntary. If you don’t want to participate, don’t, you remain unaffected by it. If a business doesn’t want to accept ducats, that’s fine, it doesn’t have to. And if it does, it can price its goods at whatever cost in ducats it wants. How much is a ducat supposed to buy? Who knows, we’ll see what the free market says. How much is a ducat worth in dollars at the exchange? Who knows, again: let the market decide.

The City would hardly have to manage the system at all. Its sole concern would be to guard against counterfeiting, which is a lot easier to do now with the advent of debit card technology.