Silvio Gesell

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Silvio Gesell : biography

March 17, 1862 – March 11, 1930

Silvio Gesell (March 17, 1862 – March 11, 1930) was a German merchant, theoretical economist, social activist, anarchist and founder of Freiwirtschaft.

Life

Silvio Gesell’s mother was Belgian and his father came from Aachen. Silvio was the seventh of nine children.

After visiting the public Bürgerschule in Sankt Vith, he attended Gymnasium in Malmedy. Being forced to pay for his living expenses from an early age, he decided against attending a university and received work for the Deutsche Reichspost, the postal system in the German Empire. He did not like this profession, so he decided to start an apprenticeship as merchant under his brother in Berlin. Then he lived in Málaga, Spain for two years, working as a correspondent. He then returned to Berlin involuntarily to complete his military service. Following this, he worked as a merchant in Brunswick and Hamburg.

In 1887, Gesell moved to Buenos Aires, Argentina, where he opened up a branch of his brother’s business. The 1890 depression in Argentina, which hurt his business considerably, caused him to reflect upon the structural problems caused by the monetary system. In 1891, he released his first writing on this topic: Die Reformation des Münzwesens als Brücke zum sozialen Staat (German for: The reformation of the monetary system as a bridge to a social state). He then wrote Nervus Rerum and The nationalization of money. He gave his business to his brother and returned to Europe in 1892.

After an intermediate stay in Germany, Gesell moved to Les Hauts-Geneveys in the Swiss canton of Neuchâtel. He established a farm in order to finance his living expenses while continuing his economic studies. In 1900, he founded the magazine Geld- und Bodenreforn (Monetary and Land Reform), but it failed as it had to be wound up in 1903 for financial reasons.

From 1907 to 1911, he was in Argentina again, then he returned to Germany and lived in the vegetarian commune Obstbausiedlung Eden, which was founded by Franz Oppenheimer in Oranienburg, north of Berlin. Here, he founded the magazine Der Physiokrat (The Physiocrat) together with Georg Blumenthal. It had to be wound up in 1914 as World War I broke out because of censorship.

In 1915, Gesell left Germany to return to his farm in Les Hauts-Geneveys. In 1919, he was called on to take part in the Bavarian Soviet Republic by Ernst Niekisch. The republic offered him a seat in the Socialization Commission and then appointed him the People’s Representative for Finances. Gesell chose the Swiss mathematician Theophil Christen and the economist Ernst Polenske as his assistants and immediately wrote a law for the creation of Freigeld. His term of office lasted only 7 days. After the bloody end of the Soviet Republic, Gesell was held in detention for several months until being acquitted of treason by a Munich court because of the speech he gave in his own defense. Because of his participation in the Soviet Republic, Switzerland denied him the opportunity to return to his farm in Neuchâtel.

Gesell then moved first to Nuthetal, Potsdam-Mittelmark, then back to Oranienburg. After another short stay in Argentina in 1924, he returned to Oranienburg in 1927. Here, he died of pneumonia on March 11, 1930.

He promoted his ideas in German and in Spanish.

Villa Gesell, a seaside town in Buenos Aires Province, Argentina was founded by (and is named after) his son Don Carlos Idaho Gesell.

Opinions about Gesell

Some opinions about Gesell:The Future of Economy – A Memoir of Economics (1984) International Association for a Natural Economic Order (Ed.)

Opinions

He considered himself a world citizen and believed the Earth should belong to all people, regardless of race, gender, class, wealth, religion and age and that borders should be made obsolete.

Gesell founded his economic thoughts on the self-interest of people as a natural, healthy motive to act, which allows the individual to follow the satisfaction of his needs and to be productive. The economic system must do justice to this pre-condition, otherwise this system would undoubtedly fail. This is why Gesell called his proposed economic system "natural". This stance put him in clear opposition to Karl Marx, who called for a change in social conditions.

Taking selfishness into account, Gesell called for free, fair business competition with equal chances for all. This included the removal of all legal and inherited privileges. Everyone should rely only on his personal abilities in order to make a living. In the "natural economic order" which he aimed for, the most talented people would have the highest income, without distortion by interest and rent charges. The economic status of the less talented would also improve, because they would not be forced to pay interest and rent charges. According to Gesell, this would lead to an equalization between the poor and the rich. Further, there would be more means available to help the poor because the higher average income would mean that everyone would have enough money to spare what was necessary to help.

According to some authors, the theory of Silvio Gesell explains the ongoing development trends in the financial industry better than any other economic doctrine. So the negative real and sometimes nominal interest rates which have been forcedly set up to stimulate economies is an indirect form of the demurrage fee proposed by Gesell.