Today, if we are to believe most polls, "Frexit" is supported neither by the majority of the population nor by the major parties. Is this because, ultimately, things are not so bad and there is therefore no need to try to improve the situation, or, as some claim, it would be apocalyptic if we did? On this fundamental question, there are numerous proposals, actions, and initiatives, as well as an abundant literature, all perfectly enlightening.

Faut-il quitter l’Union européenne pour recouvrer notre souveraineté ?

Should we (France) leave the European Union to regain our sovereignty?

BY Thomas ERPÉ

But, without a minimum effort to gather information from different sources in order to exercise critical judgment, we can only adhere to the dominant narrative disseminated by the "official media"; it is impossible to escape it. This short, unpretentious text aims to get to the heart of the matter by focusing on the monetary instrument which, within the framework of the eurozone, no longer falls under the jurisdiction of governments. Sovereignist parties (a very small minority to date) are campaigning to leave the European Union, NATO, etc., organizations that they consider major obstacles to the exercise of true democracy. We can only agree with this position: the sovereignty of a state cannot be shared; it must be full and complete, and not subject to supranational institutions (1, 2). Many believe that the classic right-left divide is now obsolete and that the real dividing line lies between sovereignists and globalists. The idea of ​​global governance is not new: "We are grateful to the Washington Post, the New York Times, Time magazine, and other major publications whose directors have attended our meetings and respected their promises of discretion for almost forty years. It would have been impossible to develop our project for the world if we had been exposed to the glare of publicity during these years. But the world today is more complex and prepared for entry into a world government." The supranational sovereignty of an intellectual elite and global bankers is certainly preferable to the national self-determination of past centuries. (David Rockefeller, Trilateral Commission, 1991)

The European project was supposed to bring all its members "peace and prosperity." Whether this is the reality is doubtful. European integration appears rather as a veritable straitjacket, a means of limiting democracy, or even short-circuiting it. Do ordinary citizens, outside of elections, still have a voice? Not really, as the decisions taken by the highest European authorities most of the time offer only a pale reflection of the opinions and interests of the population.

In the Eurozone, the single currency also has harmful effects on the economy, the impossibility of devaluing if necessary, and above all the prohibition by the treaties of financing public deficits by the Central Bank, a regulatory framework in which the State has become a market player like any other, which creates and sells debt products, building its own prison and therefore that of its people, and for the greater good of the wealthy in search of a safe and profitable investment. Indeed, the ("manufactured") indebtedness of States only serves to transfer wealth to lenders and financiers to the detriment of the real economy and employees. Furthermore, it should be noted that sovereign securities are often used as “collateral” (guarantees) in various financial transactions, and constitute the essential “raw material” that the banks, responsible for marketing (SVT, Treasury Value Specialists) transform into various savings products (Frédéric Lemaire, “This debt that creditors love” Le Monde diplomatique, September 2021).

Following the subprime crisis, so-called unconventional policies (quantitative easing) were implemented by the Central Bank, consisting of issuing large amounts of liquidity to purchase sovereign or financial securities on the secondary market in order to help struggling banks and in the hope of reviving the productive economy. Despite the colossal sums released, this had no noticeable effect on the real economy, as the liquidity mainly flowed into the financial sector, resulting in soaring financial asset prices (the stock market is at an all-time high). It seems more plausible that the true purpose of QE is to transfer losses, unstated, from banks and other investors to the ECB, acting as a "bad bank," with the eventual outright erasure of these losses.

How did finance succeed in imposing its influence on governments themselves? According to Michael Hudson, an American economist considered by his peers to be one of the best in the world: "It is through the monetary system that people are enslaved. Finance, without the monetary system that is entirely favorable to it, would no longer represent a danger to the productive economy. It is overliquidity that allows all the excesses of finance. Globalized high finance cannot prosper without the existence of a gigantic global market for public debt. The only way to escape the grip of the markets is to remove them from state financing. The greatest scam of the 20th century was the privatization of money" (Debt, Rent, and Neoliberal Predation, The Water's Edge).

Most people are unfamiliar with basic monetary mechanisms and have a false idea of ​​the reality of money, its characteristics, and its potential (3). They are convinced that the State must manage its budget like that of a household and that it has no other source of money than the money we earn. If the State wants to spend more, it must borrow from us or increase our taxes. This vision is false and, of course, everything has been done to ensure that it is firmly anchored in people's minds (4). The truth is that sovereign States in monetary matters cannot be short of money (5), since they are issuers of currency (the primary sovereign function, that of minting money), but this is no longer the case for the member countries of the Eurozone, (as Stephanie Kelton perfectly explains in her book The Myth of the Deficit, The Ties That Liberate). France had control over its public debt through the "Treasury circuit" (administered deficit financing); everything changed with the revival of liberal ideology, which pervaded senior Treasury officials and politicians from both the right and left, who considered this financing process inappropriate and a generator of inflation. Thus, step by step, it was dismantled starting in the 1970s, and at the same time, the dynamics of banking and financial deregulation began, with its main characteristics: the end of the separation of deposit and business activities of banks, free trade, and the free movement of capital. This dynamic did not affect only France; it was widespread. Benjamin Lemoine's book (The Order of Debt: An Inquiry into the Misfortunes of the State and the Prosperity of the Market, La Découverte) precisely traces the different stages of the marketing of public debt.

In short, modern money since it was “dematerialized” (end of the convertibility of the dollar into gold, in 1971) is an inexhaustible source, limited only by the rules that we impose on ourselves or more precisely that have been imposed on us. However, it is not a panacea, it is a means and not an end, its emission must be finely regulated, by creation or destruction, to adjust to the progress of the economy according to the capacities of our productive system (6): if there is too much money, there is inflation, not enough and there is deflation. Only the State is able to carry out this regulation. What really matters are our resources in “men and matter”. As for public heritage and infrastructure investment expenditure, therefore long-term (representing almost all primary deficits, i.e. excluding interest), "they should not be covered by taxes and duties or by loans, but by permanent central money which does not have to be repaid, the State lending to itself. "This would put an end to the intervention of financial markets and rating agencies on a sovereign debt which no longer ran any risk of default. And for good reason, there would no longer be any sovereign debt on the markets!" (Jean-Bayard, Politique Macro(n)économie, politiquement incorrect, "La Monnaie source de vie economic" Edilivre, 7). Furthermore, is it not paradoxical that private deposit banks are legally authorized to create money from "nothing", intended for non-banking agents (ANB), by a simple set of entries on the occasion of the credits granted (which Maurice Allais, our first Nobel Prize winner in economics, denounced in his time as "counterfeit money" 8), while the States of the Eurozone have lost this ability, they have in a way "self-expropriated". Let us specify all the same that the process of monetary creation by the banks is not free, it represents a real cost: administrative costs, infrastructure.

The main argument of those opposed to the government taking back control of the Central Bank is that this opens the door to "monetary mismanagement" that leads to inflation. So how can we describe the astronomical public debt generated by the current system? Certainly, monetary inflation can be one of the causes of rising prices, but it is far from the only one. Most often, it results from the rising costs of raw materials, energy, agricultural products in the event of poor harvests, etc., and also from taxes. "The money supply has long since had no effect on prices as long as supply adjusts quickly to demand, which is the case in developed countries. Rising prices are essentially explained by the behavior of agents who have the power to influence prices in order to improve their purchasing power." (Jean Bayard). One final clarification, most often omitted, even by experts: central bank money circulates only between holders of assets within the issuing institution, the Treasury, and deposit banks; it cannot therefore directly irrigate the real economy. To do so, it must pass through the Treasury and the banks, which "convert" it into secondary currency. To carry out their lending activities, banks, contrary to what we are led to believe, do not "refinance" themselves with the Central Bank. If they must obtain central bank money against eligible securities (and in certain circumstances, even "devalued" securities are accepted at their face value), it is to meet the needs of supplying fiat money - banknotes and coins - (economic necessity), reserve requirements (legal requirement), and also for interbank clearing and settlement.

While waiting to find a consensus and political will to free ourselves from the domination of finance, we will continue to "roll" our debt, which is akin to cavalry, for the benefit of a privileged minority and to the great satisfaction of the markets (only the interest is repaid, at maturity the principal is covered by a new loan). It should be noted that there is negotiable debt, that is to say, contracted in the form of financial instruments exchangeable on the financial markets (bonds and Treasury bills) and non-negotiable debt, corresponding to the deposits of certain public bodies (local authorities, public institutions, etc.) in the Treasury account and which also constitutes a means of financing the State (Agence France Trésor). The outstanding amount of negotiable debt as of September 30, 2025 amounted to €2,556.3 billion (Agence France Trésor). At the end of the second quarter of 2025, public debt, as defined by the Maastricht Framework, stood at €3,416.3 billion (INSEE). Only negotiable debt would be truly payable; it is difficult to obtain further information on this point (9).

The stakes are nevertheless crucial for humanity and the planet, because accepting the legacy of debt amounts to jeopardizing the future by indefinitely prolonging austerity and making impossible the public investments necessary for the ecological transition.

Finally, the big question that comes to mind is: why do even countries that have retained their monetary sovereignty (for example, the United States, the United Kingdom, Japan, etc.) continue to resort to the market to cover their deficits? Obviously, because this configuration favors the interests of holders of excess capital, who are happy to see the public deficit, which provides them with a perpetual income, widen. "Holders of government securities (Treasury bills, bonds) prefer to keep governments 'on a leash,' with central banks that only create money to bail out the banks, not the economy" (Michael Hudson).

Collectively, we must therefore improve our knowledge in this area if we want to build an economy that works for everyone, and not just for a small, privileged minority who endlessly hoard, capturing the fruits of real activity (similar to "rent extraction," as Michael Hudson and other economists call it). Political leverage is essential to reverse the balance of power; the best ideas are useless if you don't gain power. Everywhere, public debt has exploded, leading to austerity policies, the deterioration of public services, and their continued dismantling. The burden of debt is also a "convenient" argument, used by politicians as a pretext for not responding favorably to the people's demands. Creditors love the approach that blames debt victims rather than predatory finance.

The problem is that the monetary system is a taboo subject. It is forbidden to discuss it, and it is rarely discussed in an accessible manner on television and in the press. Protecting the interests of "big capital" requires that something as central as money be completely mystified, lest its function be truly understood; otherwise, capitalists would be unable to wield their absolute power. Even in his time, Henry Ford observed: "If the people of this nation understood our banking and monetary system, I believe there would be a revolution before tomorrow morning."

More and more economists around the world, including many French ones, are joining the fight to try to end the excessive hold of banks and finance on society. For the moment, they have received little attention, which is not surprising since the mainstream media and established leaders are careful not to report them. Wanting to raise awareness and educate a majority on such a sensitive issue is a difficult undertaking, and not without risk, as Stéphanie Kelton points out: "There is only one acceptable way to talk about money, taxes, and public debt. Taxes provide resources to the state, and it is taxpayers' money that finances our state. Borrowing plunges the country into debt that will weigh on our children and grandchildren. You can safely utter one of his sentences and you will be considered a serious intellectual. But if you deviate from conventional thinking, you will immediately be marginalized by a close circle of self-proclaimed budget specialists, parliamentarians, and experts who, deliberately or not, spread the deficit myth. Preaching the virtues of budgetary austerity is always safe. Challenging his articles of faith is heresy." Politicians, even if they understand how modern money works, won't be its messengers, they won't talk about it; it's too risky for their careers."

Deprived of their monetary policy, governments can no longer fully exercise their sovereignty; they are disarmed and hampered in responding to the needs of their populations and reducing the inequality gap. Controlling money is a condition for real change, and it is also necessary to put an end to the financial frenzy and the logic of endless accumulation. Making money a public good again won't solve all our problems—far from it—but without this tool, it is impossible to prioritize the common good over particular interests. Leaving the EU is therefore essential, especially since internal reform, which some advocate, does not seem possible as it stands. Of course, there are many other arguments, besides monetary ones, to justify this decision.

Note: This text was compiled from the bibliography cited in the article: Monetary Power and Public Debt.

- 1- "The abdication of a democracy can take two forms: either resorting to an internal dictatorship by handing over all powers to a providential man, or delegating these powers to an external authority, which, in the name of technology, will actually exercise political power, because in the name of a sound economy, one easily comes to dictate monetary, budgetary, and social policy—in short, a policy—in the broadest sense of the word, both national and international" (Pierre Mendès-France, Speech to the National Assembly, January 18, 1957).

- 2- "Democracy cannot abdicate into the hands of a few supposedly competent individuals, whose decisions may have consequences beyond their remit and extending far beyond the political sphere" (Clement Attlee, British Prime Minister, who declared himself against any reduction of sovereignty in favor of European institutions dominated by Conservatives).

- 3- The same is true in the political world. A recent survey (2019) conducted by the research group Positive Money revealed the incredible figure of 85% of British parliamentarians who have no idea where their money comes from. Positive Money advocates for reform of the monetary and banking system that enables a fair, democratic, and sustainable economy.

- 4- "The state has no source of money other than the money people earn themselves. If the state wants to spend more, it can only do so by borrowing your savings or increasing your taxes" (Margaret Thatcher's speech in 1983). “Across the country, families are tightening their belts and making painful decisions. The federal government must do the same” (President Obama, 2010 State of the Union address). Quoted by Stephanie Kelton in her book The Deficit Myth.

5- "Nothing prevents the Federal Government from creating as much money as it wants and paying anyone with it" (Alan Greenspan, Chairman of the Fed from 1987 to 2006). His successor, Ben Bernanke (from 2006 to 2014), went further, explaining how the government actually pays its bills: "It's not taxpayer money. We're just using the computer to increase the balance." (Statements quoted by Stephanie Kelton in her book The Deficit Myth).

- 6- "Monetary policy is essential to free up resources and reinforce fiscal policy. Much remains to be done to convince people of the merits and necessity of using monetary weapons. The two fundamental resources (people and materials) must be combined with the third (money), which gives the economic universe its movement; money is, in a way, its fuel." The purpose of economics is the rational use of these three fundamental elements. Money, contrary to popular belief, is an inexhaustible resource; its only restrictions are those arbitrarily set by monetary authorities" (Jean Bayard).

- 7- The distinctive feature of Jean Bayard's "method," who is not an economist by training, but who worked as a financial manager in a multinational corporation, is that he bases his entire argument on accounting circuits and schemes, which gives it an "undeniable rigor." The introduction to his note "The 7 Plagues of the Economy. Five Monetary Causes and Two International Causes,” sheds light on how the upper class has captured monetary power: “Having always enjoyed a dominant position, which it has endeavored to strengthen over the decades, first by law, then by brainwashing about inflation and by disseminating truncated information, monetary power has built a veritable fortress, which has become impregnable since it obtained independence. Finally, as a form of apotheosis, a sublime tour de force, it succeeded in having the Maastricht Treaty signed by most of the governments of Europe, thus having at its disposal all the coercive means of oppression through money, fighting against an imaginary inflation based on an arbitrarily fixed rate for inflation (2%), for the budget deficit (3%) and for state debt (60%). Words are not strong enough to convey the feeling of revolt that every human being can feel in the face of the extent of the ills from which our society suffers, ills whose root causes lie in the monetary restrictions imposed on us by the all-powerful monetary power and the pressure groups associated with it for their own benefit. It is urgent to free working populations from this new form of economic slavery." Note that Jean-Bayard's "macroeconomics" website no longer appears on the Internet.

- 8- "It is paradoxical today, to say the least, to note that while, for centuries, the Ancien Régime jealously preserved the State's right to mint money and the exclusive privilege of retaining the benefits thereof, the democratic Republic has largely abandoned this right and privilege to private interests." (Maurice Allais)

- 9- "Let us recall that at the beginning of this chapter we highlighted the existence of two parts of the public debt, which, surprisingly, no one (or almost no one) talks about: the negotiable part and the non-negotiable part. The first is the only truly due debt, which brings it down to 75% of GDP instead of 100% (at the end of 2016), the second being no more than a question of national treasury between the State and its public and semi-public bodies. We do not see why the latter should be subject to any repayment. It is nevertheless surprising that the two are combined to serve as the basis for the Maastricht criterion" (Jean Bayard, Politique Macro(n)économie, politiquement incorrect, chapter "Public debt", page 165).

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