If you are reading this blog you are likely to be a baby boomer as I am. People our age read boring blogs like this one, as well as History books, besides watching the History Channel (a.k.a “Nazis 24/7.”) On the average, I read 1-2 history books a month. You may have read a previous blog I wrote about the tension of opposites between John Adams and Thomas Jefferson. I ended up concluding that Adams got a bum wrap in our history and that Jefferson was over-glorified in our pantheon of Founding Fathers. But, after digging a little bit more and studying the tension of opposites between Jefferson and Alexander Hamilton, I am dully chastised and ready to restore Jefferson to his rightful place in his rotunda by the pond in D.C.
As you recall, Hamilton was the main force behind the creation of our banking system. He said that “No society could succeed which did not unite the interest and credit of rich individuals with those of the state” and that “A national debt, if it is not excessive, will be to us a national blessing.” He was behind the creation of the first National central bank as the first Secretary of the Treasury in 1791, which Jefferson fervently opposed. He knew from European history that a central bank would end up ruling the nation:
“[They] have tried and trodden every path of force in fruitless quest of the same objective, yet we still expect to find in juggling tricks and banking dreams, that money can be made out of nothing… I believe that banks are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale… Already they have raised a money aristocracy… The issuing power should be taken from the banks and restored to the people to whom it properly belongs.”
As strange as his statement may seem coming from one who was indebted all his life and died a ruined man (on the 4th of July, 50 years after 1776 and at the same time John Adams passed away) his words still ring true today, as we continue to print money out of thin air, which will fall on our children to pay. Despite his personal issues, Jefferson’s opinion on who really should be in charge of creating money is well addressed in our Constitution:
“To take a single step beyond the boundaries … of Congress is to take possession of a boundless field of power. The incorporation of a bank and the powers assumed by this bill have not been delegated to the United States by the Constitution.”
In other words, only Congress may create and regulate money, according to our Constitution, a point also emphasized by John Adams, who also despised Hamilton:
“Our whole banking system I ever abhorred, I continue to abhor, and I shall die abhorring… Every bank of discount, every bank by which interest is to be paid or profit of any kind made by the lender is downright corruption. It is taxation for the public for the benefit and profit of individuals.”
OK, that is a little too strong; we do need to have credit to start businesses.
Perhaps Adam Smith’s point of view is more moderate: business is a grand and noble enterprise, but it must be regulated because men will have a natural tendency to meet in secret to attempt to maximize profits and forget the public good.
Hamilton’s First Bank of the United States failed. But those who saw a gravy train in his banking ideas tried again in 1816 to create a central bank, which Andrew Jackson did away with, thus antagonizing powerful forces that almost derailed his presidency. He denounced the central bank as unconstitutional, as well as:
“A curse to the Republic; inasmuch as it is calculated to raise around the administration a moneyed aristocracy dangerous to the liberties of the country.”
Lincoln himself may have been killed because of his opposition to another attempt to re-create a central bank, rather than reconstruction and abolition issues. The same is rumored of JFK who had the audacity to print money through the Treasury while bypassing the Federal Reserve.
But, the boys wanting to create money out of thin air finally prevailed: in secret, corporate America and leading bankers gathered on Jekyll Island off the Georgia coast in 1913 to plan the creation of the central bank that now rules our country, the Federal Reserve. They even got Wilson elected, a friend of Wall Street, by splitting the Republican vote; they knew that Taft and Roosevelt would not have allowed such a sneaky play.
This is how we fell in the hands of dishonest bankers who now keep our TARP money for themselves to buy other banks, instead of making our own money available to borrow to meet payroll and overhead in our small businesses, like the clinic I work with. What is the Federal Reserve? It is neither a part of the Federal Government nor a Reserve, unless we are talking about a “Reserve” for the “Moneyed Aristocracy.” Congressman Lindbergh in 1913 said that the Federal Reserve
“Establishes the most gigantic trust on Earth… When the President signs this act, the invisible government by the money power… will be legitimized. The new law (creating the Federal Reserve) will create inflation whenever the trusts want inflation. From now on, depressions will be scientifically created.”
Gary Allen, author of “None Dare Call it Conspiracy” (Concord Press, 1971; page 53) may be easily dismissed as a “conspiracy freak,” but it may be prudent to read what he says before doing so:
“Using a central bank to created alternate periods of inflation and deflation, and thus whipsawing the public for vast profits, had been worked out by the international bankers to an exact science.”
Paul Walberg, one of the founders of the Federal Reserve candidly admitted that that any losses incurred from money created by them is to be covered by taxpayers:
“While technically and legally the Federal Reserve note is an obligation of the United States government, in reality it is an obligation, the sole actual responsibility for which rests on the reserve banks… The government could only be called upon to take them up after the reserve banks have failed.”
Those are fighting words. The number of people who are beginning to understand what is going on grows every day. Soon I hope said number reaches a critical mass, then, the words of Henry Ford may be fulfilled:
“It is well enough that the people of the nation do not understand our banking and monetary system for, if they did, there would be a revolution before tomorrow morning.”
Bankers have created a system that allows them to generate money out of money. Speculation and gambling, backed up by their smoke and mirrors they feel intellectually superior to have created, are nothing by tools of deception. Only hard work is the root of honest money in the long run. Anything else creates bubbles that are bound to pop. But such is the history of money (“The Ascent of Money”, Niall Ferguson; Penguin Press, 2008.)
We are bound to continue such roller coaster that enriches the rich and impoverishes the rest of us. Of course, we are not innocent. After all, we have the government we deserve. Our “affluenza” or the unrestrained consumerism that fails to fill the void within us that only love and fellowship can fill is the other side of the recessionary forces at play. We search for happiness through conspicuous consumption, thus bloating our economy with demands that are unrealistic and unsustainable. Corporations and bankers encourage such destructive habits by providing easy credit even when we don’t have the resources to pay back. Ultimately, it is our children who are left to foot the bill.
Funny money created by greedy bankers and our unrestrained shopping are the forces behind the perfect storm that is buffeting our society today. The same bloating of the economy is reflected in our bloating waistlines and medicine cabinet redolent of drugs that treat the results of such poor lifestyles. And how is it that Americans have been slowly cooked in this messy pot? Just like the proverbial frog in hot water: slowly through history, while we were diverted from these historical facts by the well-proven Roman principle of governance: “bread and circus.” Governments know they can control us by providing plenty of cheap food and entertainment. Given those two things, we are deluded by claims of freedom, when in reality such freedom is limited to choices of junk food and mindless entertainment.
Could we be truly free as we claim to be? Yes, but this takes a committed effort to learning from history, becoming active politically and join like-minded people in implementing changes in our communities. Do we still need banks? Of course, but not the centralized banks that drain money form our local communities. Personally, I fired Chase bank and joined a very solvent local organization, American First Credit Union in Salt Lake City.
Speaking of Utah (don’t read if you are biased against this wonderful state), I have to bring up a matter well-known to us locals: the Book of Mormon. Wait! I am not a Mormon, but I feel it is amazing how that book hits it right on the head when it comes to describing what is happening today. In attempting to describe what created so many bubbles and busts in their history, one of their leaders in that book isolated “secret combinations,” or “Gadianton robbers” as the root causes. He went on to predict that, just like we see in the whole history of mankind, the same “combinations” would be at play “in the latter days.”
Will President-elect Obama fix these basic problems with our system? I don’t believe so, not when he picked the tax-dodging Chairman of the biggest Federal Reserve bank, the New York branch, Mr. Geithner. Now, I am not a Democrat, nor a Republican, but I did vote for Mr. Obama, who seems quite likable and sincere. But, I am afraid that his plans to fix our economy are nothing but new wine in old bottles. We need to get new bottles and do away with the Federal Reserve and foment capitalism with strong regulations.
The health of our economy is in critical condition because we have failed to learn form history.
I fear that our own health may get worse, unless:
- We become more self sufficient
- We created local links in our neighborhoods to support one another
- We stop supporting corporations and consume locally to keep our money in our communities
- We eat unprocessed food and quit junk food; their corporate ads are practically shoving it down our throats just to maximize their profits
- We take advantage of this realignment of priorities and consume only what is necessary
- We become better educated about self-healing modalities that are cheaper and less invasive.
- We will always need our doctors in times of crisis, but 80% of health problems can be resolved by good nutrition, clean environments and good stress-coping mechanisms, which are primarily good social support networks.
As always, any period of suffering may be an opportunity to change and fix the cause of the suffering. Let us be optimistic about the future as we look at the past and learn its lessons. And let the Federal Reserve have the same fate that befell Hamilton.