Don't Let Government Print Money
The number of people who understand the Federal Reserve System is growing every day, and that is very bad news for the FED. Perhaps most amazing is that anti-FED consensus is forming among two seemingly irreconcilable camps: Those who trust in “big government” and those who do not.
With awareness and opposition higher than at any point in recent history, this banker-created and administered “monetary system” faces the very real threat of being abolished. Just like the deceptively named “Bank of the United States” that preceded it, the FED cannot survive a united and determined movement against it.
So, the question then becomes: What will replace the FED? This is where the “trust-government” and the “don’t-trust-government” alliance falls apart. The former believes that government, instead of bankers, should be able to create money out of thin air. The latter believes that no group (bankers or government) can be trusted with a monopoly on this power.
For the record, I fall firmly in the camp that doesn’t trust bankers or government with the power to create money. And although I believe that many of those in the “trust-government” camp are well intentioned, I feel that their trust ignores the countless ways in which “government” abuses the power it already has.
With that said, here are some exchanges that address the most common “trust-government” arguments & questions that I hear. (Some have been shortened or paraphrased.)
Have you heard of Stephen Zarlenga with the American Monetary Institute and have you read his book The Lost Science of Money? He seems to be right on target about the privately controlled Federal Reserve. Zarlenga has real solutions to bring monetary control back under the Federal Government where it has been before in our history. Congressman Dennis Kucinich has introduced a Bill to do that mostly written by Stephen Zarlenga and the AMI.
Yes, I'm familiar with AMI and I've read “The Lost Science of Money." I think Stephen makes a lot of good points about the “problem,” but I'm very much against his solution. Sure, if the government can simply print all the money it wants directly, we've solved the problem of "interest" on what it spends. Unfortunately, the fiat-financed corruption and unconstitutional policies, the inflationary transfer of wealth, and the inevitable destruction of the currency all remain. (I understand that he believes the government will control its spending, so inflation won't be an issue. What I don't understand is how anyone can possibly believe such a thing. If the government has refused to restrain its spending even when it must BORROW money, what will stop it from spending when it can simply print whatever it “needs?”)
In short, I feel Zarlenga’s solution will provide unlimited funding for corruption, waste and war. It puts way too much power in too few hands and, in the end, I’m certain that the currency will be printed into worthlessness.
The way I see it, we only have two options: 1) Stay with the current system with private bankers controlling the money supply and the Congress, bankrupting the nation and enriching themselves in the process. 2) Turn the monetary system over to the US Treasury and let the government issue all money, debt and interest free. New money would be created if both the House and Senate decide to do so with majority votes. It would be spent on infrastructure projects that create real jobs like roads, highways, bridges, health care, education, etc. If the people think the government is printing too much money, they tell their Congressman and Senators not to print anymore or they will vote them out in the next election.
We have examples of successful government money in our history. The 200 million of Continental dollars worked during the Revolution until the British printed 1 Billion of Continental dollars and destroyed its value and the Greenbacks issued in the Civil War by Lincoln of 450 million worked until it was destroyed by the Federal Reserve Act of 1913.
What is the 3rd alternative?? How would Joe Plummer change the system if you had the power to do so with the force of law?
3rd option: Support competing currencies and make the only role of government in "money" to be: Enforce contracts (prohibit force or fraud.)
Again, I sympathize with many of Zarlenga's objectives but I'm against his means for obtaining them. As I stated earlier, his solution will leave many severe problems still intact. In the future, I plan on writing a 5- or 10-page challenge to some of his assertions. (Most likely, it will appear in 'part 2' of Leaving The Illusion.)
<<"The 200 million of Continental dollars worked during the Revolution until the British printed 1 Billion of Continentals">>
By Zarlenga's own admission (page 382) Thomas Jefferson estimated that there were an additional $200 million British counterfeits. Zarlenga speculates that this is 'probably a very low estimate' and then speculates further that counterfeited Continentals 'could have run into the billions.' (Emphasis added.)
I'm not sure why he thinks Thomas Jefferson would have given a low estimate nor am I sure what he bases his statement 'could have run into the billions' on. Regardless, the Continentals ended in disaster and I think it's disingenuous for him to suggest we won our independence because of them. Like all fiat currencies, they dropped in value steadily and if not for France's assistance, in specie, it's unlikely that the Continentals, or any replacement fiat currency, would have won the war. I'm not saying gold and silver are our only options but they do (absent fraud) provide firm limits on what can be printed.
Regarding the Greenbacks, it's my understanding that even with limited circulation (and over just a few years) they lost half their value. It wasn't until they were made redeemable in gold that they strengthened. But while we’re talking Greenbacks, it leads to another important point regarding a central government with the power to print money: Without the printing press, the carnage of the civil war would have been greatly reduced, if not avoided entirely.
Either way with private money or government money the Civil War was going to be fought.
The track record of the private central bankers is so bad, creating bubbles and crashing the markets allowing them to make billions off their clients by recommending derivatives and credit default swaps and then shorting their own recommendations. They’ve grabbed 40% of the nation’s wealth and they are less than 1% of the population. They get us into no win wars and make billions in defense contracts.
We can do better for the people and if given the chance to vote I would vote for the Congress to eliminate the private Federal Reserve System and turn over the creation of all money to the US Treasury who could only print the amount of money authorized by the Congress by majority vote.
<<"Either way with private money or government money the Civil War was going to be fought">>
If the government didn’t have access to the money (except through the people purchasing war bonds) the unnecessary Civil War may have been averted...this addresses my earlier point: There has to be real citizen-based control over what the government spends, borrows, or prints in support of its policies.
I've invested a lot of time into researching Realpolitik. I like how Quigley (in Evolution of Civilizations)stated that all socially-beneficial “instruments” eventually turn into "institutions." From that point forward, the institution exists primarily for those who wield, and profit from, its power...the institution exists and expands at the EXPENSE of its original purpose.
That concept summarizes (pretty well) my issue with a single currency in so-called "public hands." In short, I don't believe there is any such thing as "public hands." The government is made up of men who, individually, only possess "private hands." Those hands will, over time, always find a way to further their own interests and feather their own nests. (This is true whether they’re exercising power through a "corporation" or "public institution.”) Bottom line: Giving any individual group of men the power to print and control a monopolistic national currency is a bad idea.
Regarding the bankers and the fraud they've perpetrated, keep in mind that the government, by refusing to prosecute them (a power it actually was given by the Founders) is protecting them.
Do you believe that the founders gave Congress the power to create fiat money?
Absolutely not…In fact, within the context of our nation’s history, I think it’s ridiculous for anyone to suggest otherwise. When our founding fathers drafted the Constitution, the pain and suffering of fiat money was still fresh in their minds and it’s clear, by making only gold and silver legal tender, that they intended to rid our nation of it once and for all.
If anyone would have argued in favor of allowing the creation of fiat money, it would have probably been Alexander Hamilton. Instead, he pushed for the privately controlled and misnamed “First Bank of the United States.” This suggests to me that he knew it was unconstitutional to simply create money for government purposes. The question then becomes: If the government didn't have the authority to create money for itself, how could it delegate that nonexistent power to a central bank? It seems to me that this was a way of skirting the constitutional limitations on its power. (Congress charters the bank and, in exchange for the exclusive benefits that it has conferred, receives an endless supply of money via “loans.” Hmmm, sounds a bit like the relationship it has with the FED today.)
Joe Plummer is the author of Dishonest Money: Financing the Road to Ruin. In April of 2012, he published a novel called Leaving The Illusion, and in April of 2014 he published Tragedy and Hope 101: The Illusion of Justice, Freedom and Democracy.