by Greg Coleridge
[this is a chapter of an upcoming book to be published by the American Monetary Institute on impact of the Fractional Reserve banking system]
And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place.
- Dick Durbin, US Senator, Illinois, 2009 1
In a rare public admission of the political influence by the nation’s financial sector, Senator Durbin acknowledged what has been a reality for generations. Banking corporations wield enormous political influence to shape public laws, rules and regulations to promote their private gains. Their singular and collective political influence has increased as the economy has shifted from producing real goods and services to creating, packaging, buying and/or selling ever more diverse, complex, risky and bizarre loans, insurances, currencies and other financial “products.” Money from banks that formerly were loaned to companies that produced needed consumer products are increasingly invested in options, futures, derivatives, hedge funds and other financial instruments (i.e. money invested in money) that yield greater profits.
This “financialization” of our economy increases profits and wealth of the finance, insurance and real estate (FIRE) sector and makes our nation more economically dependent on that sector to drive economic growth. Increased profits, wealth and economic dependency have also increased their political power and influence, which guarantee further profits, wealth and dependency. A vicious cycle increasing both the financial and political power of financial corporations rages on with no end in sight.
The political influence and power of financial corporations was born, however, long ago when banks were issued the power to create money out of nothing through the fractional reserve system. Backed by the Federal Reserve, the nation’s private central bank, commercial banking corporations are legally permitted and protected to create new money literally out of thin air in the form of issuing loans or investments up to 90% of the amount of their existing reserves.
This means that for every $10,000 in assets held in reserve by a banking corporation, $100,000 in new money will over time literally be created by simple keystrokes on a bank computer. One hundred thousand dollars can be parlayed into one million dollars, $1 million into $10 million, $1 billion into $10 billion, and so on indefinitely. None of this includes the additional interest owed to banks due to these leveraged loans. Actions that would land you and I in jail (i.e. creating money) are legally permitted by banking corporations.
It’s another vicious cycle of issuing never-ending mind-boggling unearned wealth for banking corporations. It also creates a virtually bottomless pool of resources that can be invested to influence public policies -- both in creating new and defending exiting laws and rules beneficial to their interests.
Since “corporations are persons” and “money is speech” in our current constitutional system, banking corporations (like all corporations) can use their corporate revenue exercising their political “free speech” on behalf of and in opposition to issues, ballot measures and political candidates. The combination of these constitutional “rights” and virtually unlimited corporate resources thanks to fractional reserve banking means the political voices of banking corporations drown out the political voices of people who aren’t corporate CEOs or otherwise personally wealthy. This profoundly threatens what remains of our democracy
Eliminating the fractional reserve system is essential to creating a sustainable economy that meets the needs of our nation. It’s also essential to creating real democratic self-governance.
Early fears of banking influence
There was strong opposition to the formation and continuation of each of the first two privately operated central banks of the United States – the Bank of the United States (1791-1811) and Second Bank of the United States (1816-1836). Both were chartered or licensed for limited durations and purposes. Both charters weren’t renewed due to economic and political fears. Thomas Jefferson said, “I sincerely believe…that banking establishments are more dangerous than standing armies.”2
President Andrew Jackson in his veto to a bill to renew the Second Bank’s charter stated the bank was guilty of fraud, corruption, and controlling the money supply to economically and politically benefit the bank. “[B]eyond question,” he asserted, “[this] powerful institution had been actively engaged in attempting to influence the elections of the public officers by means of its money...”3
Like other businesses at the state level early in our nation’s history, banks were charted by state legislatures. Charters were considered democratic tools by states to ensure banks and other corporations wouldn’t govern. After all, people were sovereign following the Revolution. Corporations, including banks, were subordinate to We the People.
The Ohio Supreme Court ruled, for instance, that,
…[A] banking institution is a public institution, appointed for public purposes – never legitimately created for private purposes… its operations are subject to the control of that public, who may, from time to time, as the public good may require, enlarge, restrain, limit, modify its powers and duties, and, at pleasure, dispense with its benefits.4
Banks and other corporations that tried on their own to go into banking or otherwise usurp their charters were especially targeted by state legislators and courts that routinely revoked their charters for acting ultra virus (beyond their authority). Charter revocations were considered democratic actions by states to control the economic and political powers of corporations – especially banks.
“Locofocos,” members of the radical wing of the Democratic Party, were political firebrands in the first half of the 19th century. They were opposed to state banks, monopolies, paper money, tariffs, and financial policies that were undemocratic and conducive to special privilege.5
The Populists who feared the economic and political power of railroads and banks followed them. The national Populist Party in their Omaha Platform declared: “We demand a national currency, safe, sound, and flexible, issued by the general government only, a full legal tender for all debts, public and private, and that without the use of banking corporations.”6
President Lincoln issued Greenbacks, US debt-free money, to pay for the Civil War. This prevented economic, if not political, servitude of the nation by banks since the US government printed and circulated the money it needed without relying on banking corporations – and the interest and political strings that are attached.
The Federal Reserve System
The personification of economic and political power of banks during the late 19th century was JP Morgan. He controlled at the turn of the century a “Money Trust” of more than 100 banks, railroads, utilities and industrial corporations having total resources of $30 billion – the equivalent of $7.5 trillion dollars today. This represented 40% of all industrial, commercial and financial capital in the nation.7
Morgan’s money was the difference in electing William McKinley as President in 1896 in exchange for McKinley’s support of a money system backed by gold. Morgan’s wealth was also used to fund the Indianapolis Monetary Convention, a phony “grassroots reform” group calling for a new monetary system and private central bank. To heighten the issue, Morgan orchestrated the economic panic of 1907, which intensified the demand for a new central bank.
Bankers drafted a plan for the new central bank – controlled by none other than bankers. Morgan and other bankers drew upon their vast financial fortunes to lobby for the bill. The result was the 1913 Federal Reserve Act. “When the President Woodrow Wilson signs this bill,” Republican Congressman Charles Lindbergh said, “the invisible government by the monetary power will be legalized…”8
What the Act legalized was the monopoly by the new Federal Reserve System to create the nation’s paper money supply. It also granted the Fed the power to create money out of thin air as debt via purchases of government securities. The Fed also became the financial backstop for regional and local banks to create their own money out of nothing and to issue loans 10 times the amount in excess of their actual reserves. The Fed fueled, legitimized and to a certain extent protected banks that engaged in fractional reserve banking.
Lobbying and Campaign Contributions/Investments
The FIRE sector spends huge sums lobbying Congress and federal agencies. The sector spent $4.7 billion on federal lobbying between 1998 and 2011, employing several thousands of lobbyists. This was larger than any other sector except health, which spent just $3 million more during the 13-year period.9 Political campaign “contributions” (a more appropriate term would be “investments”) to federal candidates since 1990 from the FIRE sector total $2.8 billion.10
What did all this lobbying and contributions/investments yield over the last two decades? The money industry’s leveraged buyout of our political system resulted in passage of certain laws and blockage of others – all of which contributed to the 2008 Wall Street crash and global economic recession or slowed economy recovery. These included:
- Passage of the Financial Services Modernization Act in 1999 which repealed the 1933 Glass-Steagall Act prohibiting commercial banks from providing investment banking and insurance services
- Rejection of regulation of financial derivatives advocated by the federal Commodity Futures Trading Commission (CFTC) and its head Brookley Born.
- Blockage of a law forcing banks to disclose money-losing or “toxic” assets to their investors.
- Passage of the Commodities Futures Modernization Act (CFMA) in 2000 which exempted financial derivatives, including credit default swaps, from any regulation.
- Enactment of a rule by the Securities and Exchange Commission permitting investment banks to set their own debt to capital ratio. It had been no more than 12:1. Afterwards, some banks went as high as 40:1.
- Failure to prevent predatory lending
- Federal preemption of state consumer protection laws
- Making it easier for banks to purchase, bundle and sell subprime loans without fear of liability
- Forcing Fannie Mae and Freddie Mac to divert from purchase prime housing loans to risky subprime loans from financial institutions.
- Massive mergers and concentration in the financial sector
- Passage of the Credit Rating Agencies Reform Act of 2006 reducing the ability of the SEC to oversee credit rating agencies that were giving high marks to financial entities engaged in risky investments.11
Banks and other financial institutions, which caused the 2008 financial and housing crisis, were first in line to receive billions in federal bailout assistance. US commercial banking corporations with political ties were more likely to receive federal bailout money under the Troubled Assets Relief Program (TARP). Among the largest recipients were Bank of America ($45 billion), Citigroup ($45 billion), JP Morgan Chase ($25 billion), and Wells Fargo ($25 billion).12
Banks that spent more money on political lobbying were more likely to receive TARP bailout funds. Banks were also more likely to receive TARP money if they had an executive who served on the board of one of the 12 Federal Reserve Banks.13
Wall Street pulled out all stops to neuter the Dodd-Frank Restoring American Financial Stability Act, the so-called financial “reform” bill passed in 2010. What started out as a legitimate effort to “rein in $600 trillion in derivatives, create a giant new federal agency to protect financial consumers, open up the books of the Federal Reserve for the first time in history and perhaps even break up the so-called ‘Too Big to Fail’ giants on Wall Street” achieved little permanent change as the nation’s biggest banks unleashed over 2000 paid lobbyists and showered key Congressmen and Senators will campaign contributions/investments.14 Wall Street spent $251 million on lobbying connected to the bill during the first half of 2010.15
Nineteen of the twenty-two members of the Senate Banking Committee, which dealt with the proposal, receive donations from Wall St in 2009. Each of those up for reelection in 2010 received at least $180,000.16 Senate Banking Committee chair Chris Dodd has received over $12 million in his career in political contributions from the FIRE sector.17 Barney Frank, outgoing Chair of the House Financial Services Committee, raised about $1 out of every $3 over his career from the FIRE sector.18 The FIRE sector invested $42 million in the Obama campaign in 2008. John McCain raised, by comparison, $31 million.19
More than $352 million was spent by the FIRE sector during the first three-quarters of 2011, employing more than 2300 lobbyists.20 Lobbying by the five largest spenders in the banking sector increased 12% from a year earlier, from $42 million to $47 million. The major spenders included the American Bankers Association, Wells Fargo, JP Morgan Chase, and Citigroup. Bank of America was seventh on the list. The biggest increase in lobbying was by Wells Fargo, up 80% over 1 year. The bank alone has 28 paid lobbyists working in Washington, up from five in 2008. If the pace continues, 2011 will be the sixth year in a row commercial bank lobbying has set a record, according to the Center for Responsive Politics.21
The target of the lobbying was once again the Dodd-Frank so-called “financial reform” law. Though passed by Congress in 2010, more than 300 new implementation rules and details were still to be crafted by federal regulators, from a cap on swipe fees merchants pay on debt transactions to terms for implementing the Volker Rule, which bans proprietary trading. Wall Street lobbying sought to ignore, water down or outright undo many of these rules. More that 350 meetings with regulators were held by Wall Street lobbyists on just the Volker Rule compared to 20 by “progressive” groups that favor stricter trading rules.22
Political lobbying is particularly effective for the banking and other sectors during the rule making process following passage of any legislation for several reasons. The public, for one, is usually not actively engaged lobbying for their interests, as most citizens believe nothing more can be done once a bill is passed. For another, lobbyists engage with bureaucrats or congressional staffers instead of elected officials at this stage in closed door meetings – bureaucrats and staffers who are often enticed with employment as a lobbyist, consultant or strategist if they play ball. Bank funds are used to hire former government employees. In addition, many former lobbyists during one year or political administration end up back inside government the next year or administration. This “revolving door” phenomenon is quite common among the FIRE sector. Open Secrets reports that 2500 people have passed through the government-FIRE sector revolving door. This is the third highest of all sectors. It provides an even greater political bang for the bank lobbying buck.23
Not all revolving door members are low lever staffers and bureaucrats. Secretary of the Treasury appointees Robert Rubin and Hank Paulson during the Clinton and Bush administration have come from major banking corporations. Tim Geithner, the current Treasury Secretary, was head of the Federal Reserve Bank of New York, the most powerful of all the private regional central banks.
The money industry’s political investments also bought freedom for those responsible for the financial and housing crisis. Despite evidence of fraud at the major banks, no major bank executive has gone to jail. "If you go back to the savings and loan debacle, we got more than a thousand felony convictions of the elite...” according to William Black who was deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement.24
The FIRE sector has already contributed $16.8 million to Presidential candidates through December 2011. 25
Debt Dependency
The Federal Reserve System itself wields enormous political influence. The ability of the Federal Reserve and its member banks to create money out of nothing through fractional reserve banking allows it to be the major supplier of our government’s debt through purchases of trillions of dollars of federal IOU securities – notes, bills and bonds.
The US government has become dependent on the Fed to keep purchasing its debt. The Fed, as a private banking institution, is under no obligation, legal or otherwise, to continue to buy Treasury bills or any other security. This gives the Fed enormous political leverage in our nation in much the same way the International Monetary Fund (IMF) possesses political leverage over foreign countries that request loans to avoid default.
In the case of the IMF the conditions for further loans (called Structural Adjustment Programs, or SAPs) are changes in public policies – eliminating public employees, slashing public benefits, privatizing public assets, increases taxes and fees on all but the rich, debt reduction, deregulation, and reduction of trade barriers. If no austerity measures are enacted by nations, the IMF provides no loans
Ben Bernanke, Chairman of the Federal Reserve, has repeatedly called on policymakers to enact the Fed’s own version of SAPs. Bernanke, and by extension the Fed, wants Congress to reduce the national debt, cut Medicare and Medicaid, tax goods and services (institute a Value Added Tax), and phase in spending cuts and other austerity measures over the next few years. 26 The threat of ending or slowing the purchase of government securities in general or certain securities to pay for programs the Fed disagrees with (i.e. anything that is not moving toward cutting benefits, services and programs to the working class and poor) is real.26
Just to make sure Congress knows the sentiments of the financial community on debt reduction, the FIRE sector was the third largest industry that lobbied the Congressional Supercommmittee.27
The money creation and leveraging ability of the Fed provides it with the wherewithal to pick economic winners and losers. The Fed’s original purpose of purchasing only government-backed securities is long gone. Prior to 2009, the Federal Reserve wasn’t allowed to purchase non-government securities or to hold them as assets. Sine then, they’ve purchased huge amounts of private, mortgage-backed securities.
The Fed offered insurance giant AIG $110 billion as a credit line and provided another $16 trillion in secret loans to bail out US and foreign banks.28 Choosing which banks and other entities receive bailout money and lines or credit not only impacts businesses, but also jobs, income, taxes, communities and political fortunes.
The Fed along the way also acquired new governing powers to regulate banks.29
The Fed’s political power, interconnected with their economic power, is potent. Is it any wonder that Simon Johnson, former IMF chief economist, said, “The finance industry has effectively captured our government.”
*****
The authority of the Federal Reserve and banking corporations to create money out of nothing and provide debt amounts far in excess of reserves is dangerous to our economy and what’s left of our representative democracy. The Money Trust has “captured our government.” They “frankly, own the place.”
Ending the fractional reserve system, as proposed in the NEED Act, HR 2990, and promoted by the American Monetary Institute ( www.monetary.org/ ) is essential. Breaking the nexus between economic and political power of the FIRE sector also requires political reform, specifically ending the twin legal fictions that “corporations are people” and “money is speech,” as promoted by the Move to Amend coalition ( http://movetoamend.org/ ). Together, these changes lay the foundation for a real democratic economy and government.
Notes
1 Ray Grim, Dick Durbin: Banks "Frankly Own The Place," Huffington Post, May 30, 2009.
2 Thomas Jefferson, letter to John Taylor, Monticello, 28 May 1816. Ford 11:533. http://www.monticello.org/site/jefferson/private-banks-quotation
3 Andrew Jackson, Fifth Annual Message, December 3, 1833
http://thehistorybox.com/ny_city/panics/panics_article3a.htm
4 Knoup v the Piqua Bank 1 Ohio S 603 (1853)
5 Coleridge, Greg, Citizens over Corporations: A Brief History of Democracy in Ohio and Challenges to Freedom in the Future, Northeast Ohio American Friends Service Committee, p 30.
6 Omaha Platform, July 4, 1892
http://clio.missouristate.edu/wrmiller/Populism/texts/documents/Omaha_Platform.htm
7 DeLong, J. Bradford, J.P. Morgan and His Money Trust, Harvard University, 1992.
8 Charles August Lindbergh, http://en.wikipedia.org/wiki/Charles_August_Lindbergh
9 http://www.opensecrets.org/lobby/top.php?indexType=c
10 http://www.opensecrets.org/industries/totals.php?cycle=2012&ind=F
11 Essential Information and Consumer Education Foundation, Sold Out: How Wall Street and Washington Betrayed America, March 2009, www.wallstreetwatch.org
12 Propublica, Bailout Recipients, Last updated, Dec. 12, 2011
http://projects.propublica.org/bailout/list
13 Steve Eder, Banks with political ties got bailouts, study shows Reuters, Dec. 21, 2009
14 Matt Taibbi, Wall Street’s War, Rolling Stone, May 26, 2010.
15 Jennifer Liberto, Wall Street's lobbying pricetag: $251 million, CNNMoney, Aug. 2, 2010, http://money.cnn.com/2010/08/02/news/economy/Wall_Street_lobbying/index.htm
16 Foster, John Bellamy and Holleman, Hannah, The Financial Power Elite, Monthly Review, May 2010.
17 http://www.opensecrets.org/politicians/industries.php?cycle=Career&cid=N00000581&type=I
18 http://www.opensecrets.org/news/2011/11/which-democrat-will-next-head-financial-services.html
19 http://www.opensecrets.org/pres08/sectors.php?sector=F
20 http://www.opensecrets.org/lobby/indus.php?id=F&year=a
21 Dunn, Andrew, Banks find extra money to hire lobbyists in D.C., The Charlotte Observer, Nov. 20, 2011.
22 Ibid.
23 http://www.opensecrets.org/revolving/top.php?display=I
24 William K. Black on Fraud, Bill Moyers Journal, April 23, 2010,
http://www.pbs.org/moyers/journal/04232010/profile.html
25 http://www.opensecrets.org/pres12/sectors.php?cycle=2012
26 Rick Newman, What Bernanke Wants Congress To Do, US News and World Report,
August 29, 2011
27 http://www.opensecrets.org/news/2011/11/health-sector-groups-most-aggressively-lobby-the-supercommittee.html
28 The Fed Audit, US Senator Bernie Sanders website,
http://sanders.senate.gov/newsroom/news/?id=9e2a4ea8-6e73-4be2-a753-62060dcbb3c3
29 Joshua Ritchie, Reshaping the Fed, Feb. 22, 2010 http://www.mint.com/blog/trends/reshaping-the-fed/
Greg Coleridge is Director of the Northeast Ohio American Friends Service Committee (http://www.afsc.net) in Cuyahoga Falls, Ohio. Contact: gcoleridge@afsc.org /
http://www.facebook.com/greg.coleridge / http://www.createrealdemocracy.blogspot.com
Wednesday, February 29, 2012
Can There Be “Good” Corporations?
The answer is Yes! Herein lies yet another positive change if corporate personhood and money as speech ended -- our society could support (including through tax incentives, etc) the creation and maintenance of employee owned businesses, credit unions, and cooperatives of all kinds. Democratizing our government must go hand-in-hand with democratizing our economy.
http://www.yesmagazine.org/issues/9-strategies-to-end-corporate-rule/can-there-be-201cgood201d-corporations
http://www.yesmagazine.org/issues/9-strategies-to-end-corporate-rule/can-there-be-201cgood201d-corporations
What Could Change in Ohio if Corporations Weren’t People and Money Wasn’t Speech?
Here are specific ways our health, safety, welfare and democracy in our communities and state could be improved -- from clean air to clean elections, increasing our right to know to our right to decide, keeping toxic waste to chain stores out of our communities, and knowing what’s in our food to the chemicals injected in our land.
http://movetoamendohio.org/files/WhatCouldChangeInOhio.pdf
http://movetoamendohio.org/files/WhatCouldChangeInOhio.pdf
Monday, February 27, 2012
MONETARY HISTORY CALENDAR - February 27 – March 4
FEBRUARY 27
1844 – DEATH OF NICHOLAS BIDDLE, PRESIDENT OF SECOND NATIONAL BANK
Biddle threatened to cause a depression if President Andrew Jackson did not re-charter the Bank. The privately owned Second Bank was chartered in 1816. President Jackson did not sign the bill to renew the charter. "This worthy President thinks that ... he is to have his way with the Bank. He is mistaken...[opposition] can only be broken by the actual conviction of exiting distress in the community... Our only safety is in pursuing a steady course of firm restriction [of the money supply] - and I have no doubt that such a course will ultimately lead to restoration of the currency and the re-charter of the Bank." The result of the contraction of the money supply was a financial panic followed by a deep depression. (Edward Kaplan, The Bank of the United States and the American Economy)
1867 – BIRTH OF IRVING FISHER, MATHEMATICAL ECONOMIST
"If two parties instead of being a bank and an individual, were an individual and an individual, they could not inflate the circulating medium by loan transaction, for the simple reason that the lender could not lend what he didn't have as banks can do ... Only commercial banks and trust companies can lend money that they manufacture by lending it.” 100% Money (1935)
FEBRUARY 28
1856 – BIRTH OF WOODROW WILSON, 28TH PRESIDENT OF THE UNITED STATES
“A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men who, even if their action be honest and intended for the public interest, are necessarily concentrated upon the great undertakings in which their own money is involved and who necessarily, by very reason of their own limitations, chill and check and destroy genuine economic freedom.” (1911)
MARCH 2
1876 -- US SILVER COMMISSION (TO STUDY THE CRIME OF 73) REPORT RELEASED ON WHAT CAUSED THE 1873 DEPRESSION
The Commission concluded that the depression was caused to a reduction of the money supply. They compared the 1873 Depression to the deflation of the Roman era. “The disaster of the Dark Ages was caused by decreasing money and falling prices… Without money, civilization could not have had a beginning, and with a diminishing supply, it must languish and unless relieved, finally perish. Falling prices and misery and destitution are inseparable companions. It is universally conceded that falling prices result from the contraction of the money volume.” The Report suggested that the Dark Ages ended when paper money was issued, “It is suggestive coincidence that the fist glimmer of light only came with the invention of bills of exchange, and paper substitutes…”
MARCH 3
1863 - LEGAL TENDER ACT PASSED
Congress authorizes the Government to print no more than $400,000 million Greenbacks to pay for the Civil War. This was interest-free and debt-free money. The Lincoln Administration did not want to borrow money from corporate banks to pay for the war.
1865 – NATIONAL CURRENCY ACT AMENDED BY CONGRESS
The act amended the National Currency Act of 1864. State banks were no longer permitted to issue bank notes (currency).
1884 – JULLIARD V. GREENMAN ( 110 U.S. 421 ) SUPREME COURT DECISION
US Supreme Court ruling upholding the legality of US Government issued money (Greenbacks) created following the Legal Tender Acts of 1862 and 1863. The Court ruled that the government possessed the authority under the Constitution to issue a national currency and that that currency could be used to pay debts.
2003 - WARREN BUFFET, SECOND RICHEST PERSON ON EARTH, IN HIS ANNUAL LETTER TO BERKSHIRE HATHWAY SHAREHOLDERS
“Derivatives are financial weapons of mass destruction."
MARCH 4
1789 – US GOVERNMENT UNDER NEW CONSTITUTION BEGINS OPERATION
The Constitution replaced the Articles of Confederation as the overarching legal document of the nation. The new Constitution provides the federal legislature the sole power “[t]o coin money [and] regulate the value thereof.” (Article 1, Sec 8). The Government subsequently abdicated its responsibility when it gave the Federal Reserve and private banks the power to create money literally out of thin air…as debt.
1837 – FAREWELL ADDRESS OF PRESIDENT ANDREW JACKSON
Jackson was most responsible for not renewing the charter of the misnamed Second Bank of the United States, a private institution. In his farewell address when leaving office (Presidents used to sworn in during the beginning of March for decades, now it’s mid January), he stated, “The immense capital and peculiar privileges bestowed upon it [(Second National Bank of the United States] enabled it to exercise despotic sway over the other banks in every part of the country. From its superior strength it could seriously injure, if not destroy, the business of any one of them, which might incur its resentment; and it openly claimed for itself the power of regulating the currency throughout the United States. In other words, it asserted (and it undoubtedly possessed) the power to make money plenty or scarce at its pleasure, at any time and in any quarter of the Union, by controlling the issues of other banks and permitting an expansion or compelling a federal contraction of the circulating medium, according to its own will.”
1861 – INAUGURATION OF PRESIDENT ABRAHAM LINCOLN, 16TH PRESIDENT OF THE UNITED STATES – A REPUBLICAN
"The Government should create issues, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of the consumers. By the adoption of these principles, the taxpayers will be saved immense sums of interest. The privilege of creating and issuing money is not only the supreme prerogative of the government, but it is the Government's greatest creative opportunity."
This is something to keep in mind during this period when Republican parties at the local level hold their “Lincoln Day” annual fundraising dinners.
------
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis, Alice Francini and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
For more information, visit http://www.afsc.net/economiccrisis.html
1844 – DEATH OF NICHOLAS BIDDLE, PRESIDENT OF SECOND NATIONAL BANK
Biddle threatened to cause a depression if President Andrew Jackson did not re-charter the Bank. The privately owned Second Bank was chartered in 1816. President Jackson did not sign the bill to renew the charter. "This worthy President thinks that ... he is to have his way with the Bank. He is mistaken...[opposition] can only be broken by the actual conviction of exiting distress in the community... Our only safety is in pursuing a steady course of firm restriction [of the money supply] - and I have no doubt that such a course will ultimately lead to restoration of the currency and the re-charter of the Bank." The result of the contraction of the money supply was a financial panic followed by a deep depression. (Edward Kaplan, The Bank of the United States and the American Economy)
1867 – BIRTH OF IRVING FISHER, MATHEMATICAL ECONOMIST
"If two parties instead of being a bank and an individual, were an individual and an individual, they could not inflate the circulating medium by loan transaction, for the simple reason that the lender could not lend what he didn't have as banks can do ... Only commercial banks and trust companies can lend money that they manufacture by lending it.” 100% Money (1935)
FEBRUARY 28
1856 – BIRTH OF WOODROW WILSON, 28TH PRESIDENT OF THE UNITED STATES
“A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men who, even if their action be honest and intended for the public interest, are necessarily concentrated upon the great undertakings in which their own money is involved and who necessarily, by very reason of their own limitations, chill and check and destroy genuine economic freedom.” (1911)
MARCH 2
1876 -- US SILVER COMMISSION (TO STUDY THE CRIME OF 73) REPORT RELEASED ON WHAT CAUSED THE 1873 DEPRESSION
The Commission concluded that the depression was caused to a reduction of the money supply. They compared the 1873 Depression to the deflation of the Roman era. “The disaster of the Dark Ages was caused by decreasing money and falling prices… Without money, civilization could not have had a beginning, and with a diminishing supply, it must languish and unless relieved, finally perish. Falling prices and misery and destitution are inseparable companions. It is universally conceded that falling prices result from the contraction of the money volume.” The Report suggested that the Dark Ages ended when paper money was issued, “It is suggestive coincidence that the fist glimmer of light only came with the invention of bills of exchange, and paper substitutes…”
MARCH 3
1863 - LEGAL TENDER ACT PASSED
Congress authorizes the Government to print no more than $400,000 million Greenbacks to pay for the Civil War. This was interest-free and debt-free money. The Lincoln Administration did not want to borrow money from corporate banks to pay for the war.
1865 – NATIONAL CURRENCY ACT AMENDED BY CONGRESS
The act amended the National Currency Act of 1864. State banks were no longer permitted to issue bank notes (currency).
1884 – JULLIARD V. GREENMAN ( 110 U.S. 421 ) SUPREME COURT DECISION
US Supreme Court ruling upholding the legality of US Government issued money (Greenbacks) created following the Legal Tender Acts of 1862 and 1863. The Court ruled that the government possessed the authority under the Constitution to issue a national currency and that that currency could be used to pay debts.
2003 - WARREN BUFFET, SECOND RICHEST PERSON ON EARTH, IN HIS ANNUAL LETTER TO BERKSHIRE HATHWAY SHAREHOLDERS
“Derivatives are financial weapons of mass destruction."
MARCH 4
1789 – US GOVERNMENT UNDER NEW CONSTITUTION BEGINS OPERATION
The Constitution replaced the Articles of Confederation as the overarching legal document of the nation. The new Constitution provides the federal legislature the sole power “[t]o coin money [and] regulate the value thereof.” (Article 1, Sec 8). The Government subsequently abdicated its responsibility when it gave the Federal Reserve and private banks the power to create money literally out of thin air…as debt.
1837 – FAREWELL ADDRESS OF PRESIDENT ANDREW JACKSON
Jackson was most responsible for not renewing the charter of the misnamed Second Bank of the United States, a private institution. In his farewell address when leaving office (Presidents used to sworn in during the beginning of March for decades, now it’s mid January), he stated, “The immense capital and peculiar privileges bestowed upon it [(Second National Bank of the United States] enabled it to exercise despotic sway over the other banks in every part of the country. From its superior strength it could seriously injure, if not destroy, the business of any one of them, which might incur its resentment; and it openly claimed for itself the power of regulating the currency throughout the United States. In other words, it asserted (and it undoubtedly possessed) the power to make money plenty or scarce at its pleasure, at any time and in any quarter of the Union, by controlling the issues of other banks and permitting an expansion or compelling a federal contraction of the circulating medium, according to its own will.”
1861 – INAUGURATION OF PRESIDENT ABRAHAM LINCOLN, 16TH PRESIDENT OF THE UNITED STATES – A REPUBLICAN
"The Government should create issues, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of the consumers. By the adoption of these principles, the taxpayers will be saved immense sums of interest. The privilege of creating and issuing money is not only the supreme prerogative of the government, but it is the Government's greatest creative opportunity."
This is something to keep in mind during this period when Republican parties at the local level hold their “Lincoln Day” annual fundraising dinners.
------
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis, Alice Francini and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
For more information, visit http://www.afsc.net/economiccrisis.html
Monday, February 20, 2012
MONETARY HISTORY CALENDAR - February 20-26
FEBRUARY 20
1862 – US SENATOR THADDEUS STEVENS SPEAKS ON SENATE FLOOR AGAINST “EXCEPTION CLAUSE” OF GREENBACK ACT
“I have a melancholy foreboding that we are about to consummate a cunningly devised scheme, which will carry great injury to all classes of people throughout the Union.” (see below for explanation of Exception Clause).
FEBRUARY 22
1878 – FOUNDING OF GREENBACK-LABOR PARTY
The National (Greenback-Labor) Party was formed at a convention in Toledo, Ohio. Their platform declared that reform of the monetary system was necessary in order to "secure to the producers of wealth the results of their labor and skill, and muster out of service the vast army of idlers who, under the existing system, grow rich upon the earnings of others, that every man and woman may, by their own efforts, secure a competence, so that overgrown fortunes and extreme poverty will seldom be found within the limits of our Republic.”
FEBRUARY 25
1791 – CREATION OF THE FIRST BANK OF THE UNITED STATES
A 20-year charter was issued by the federal government (very unusual at the time since most corporate charters, or licenses, were issued by states) to create the first national private bank. This was the first private institution empowered to create paper money -- with all the power and profit that goes along with it. The bank’s paper money was accepted for taxes. Eighty percent of its shares were privately owned, among these 75% were foreign owned (mostly by the English and Dutch). The bank was modeled on the Bank of England. It’s main proponent, Alexander Hamilton, argued in support: "Suppose that the necessity existed...for obtaining a loan; that a number of individuals came forward and said, we are willing to accommodate the government with this money (which we have or can raise) but in order to do this it is indispensable, that we should be incorporated as a bank...and we are obliged on that account to make it a consideration or condition of the loan." In other words, Hamilton was saying the private/corporate bank will be more than happy to give the government loans if the government grants the private/corporate bank the power to create money! Jefferson, Madison and others opposed it. Jefferson said, "This institution (the Bank of England) is one of the most deadly hostility against the principles of our Constitution…suppose an emergency should occur…an institution like this…in a critical moment might overthrow the government." The bank had an enormous impact on the economy early on. Within 2 months of its creation, it flooded the market with loans and banknotes and then suddenly called in many of its loans. The result was the first US securities market crash -- what became known as the “Panic of 1792” – the first of many panics, recessions and depressions due to the private/corporate control of our money system.
1862 – LEGAL TENDER ACT PASSED
A bill authorizing the issuance of $150 million non interest-bearing United States notes (commonly referred to as “Greenbacks”). Congress would later grant $300 million more in US notes. This was interest free US money. The administration of Republican President Abraham Lincoln wanted to avoid the nation going into debt borrowing money from private/corporate bankers to pay for the Civil War. Greenbacks were not bonds or notes or any other promises to pay “money” at some future time. They were money. Since they were not borrowed, they didn’t add to the national debt. What later made them inflationary was they were used to pay for war – which didn’t produce or add anything productive to the economy to offset the added money supply. The bill contained an “Exception Clause”, which stated that Greenbacks could not be used to pay the interest on the national debt, nor to pay taxes, excises, or import duties. This maintained a demand and legitimacy for bank-issued debt money.
1863 – NATIONAL BANKING ACT PASSED
It provided for the national chartering of banks by the federal government. This replaced state charters – many of which contained much more rigid and democratic provisions. The Act in numerous ways standardized banking across the country. The act established National Banking Associations, the office of the Comptroller of the Currency, and a system of national chartered banks with control over all of them coming from Washington. The new banks were given virtaully tax free status. In doing so, it entrenched what some have called “structural fraud” of the banking system – creating money out of thin air and charting interest on it.
----------------
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
For more information, visit http://www.afsc.net/economiccrisis.html
1862 – US SENATOR THADDEUS STEVENS SPEAKS ON SENATE FLOOR AGAINST “EXCEPTION CLAUSE” OF GREENBACK ACT
“I have a melancholy foreboding that we are about to consummate a cunningly devised scheme, which will carry great injury to all classes of people throughout the Union.” (see below for explanation of Exception Clause).
FEBRUARY 22
1878 – FOUNDING OF GREENBACK-LABOR PARTY
The National (Greenback-Labor) Party was formed at a convention in Toledo, Ohio. Their platform declared that reform of the monetary system was necessary in order to "secure to the producers of wealth the results of their labor and skill, and muster out of service the vast army of idlers who, under the existing system, grow rich upon the earnings of others, that every man and woman may, by their own efforts, secure a competence, so that overgrown fortunes and extreme poverty will seldom be found within the limits of our Republic.”
FEBRUARY 25
1791 – CREATION OF THE FIRST BANK OF THE UNITED STATES
A 20-year charter was issued by the federal government (very unusual at the time since most corporate charters, or licenses, were issued by states) to create the first national private bank. This was the first private institution empowered to create paper money -- with all the power and profit that goes along with it. The bank’s paper money was accepted for taxes. Eighty percent of its shares were privately owned, among these 75% were foreign owned (mostly by the English and Dutch). The bank was modeled on the Bank of England. It’s main proponent, Alexander Hamilton, argued in support: "Suppose that the necessity existed...for obtaining a loan; that a number of individuals came forward and said, we are willing to accommodate the government with this money (which we have or can raise) but in order to do this it is indispensable, that we should be incorporated as a bank...and we are obliged on that account to make it a consideration or condition of the loan." In other words, Hamilton was saying the private/corporate bank will be more than happy to give the government loans if the government grants the private/corporate bank the power to create money! Jefferson, Madison and others opposed it. Jefferson said, "This institution (the Bank of England) is one of the most deadly hostility against the principles of our Constitution…suppose an emergency should occur…an institution like this…in a critical moment might overthrow the government." The bank had an enormous impact on the economy early on. Within 2 months of its creation, it flooded the market with loans and banknotes and then suddenly called in many of its loans. The result was the first US securities market crash -- what became known as the “Panic of 1792” – the first of many panics, recessions and depressions due to the private/corporate control of our money system.
1862 – LEGAL TENDER ACT PASSED
A bill authorizing the issuance of $150 million non interest-bearing United States notes (commonly referred to as “Greenbacks”). Congress would later grant $300 million more in US notes. This was interest free US money. The administration of Republican President Abraham Lincoln wanted to avoid the nation going into debt borrowing money from private/corporate bankers to pay for the Civil War. Greenbacks were not bonds or notes or any other promises to pay “money” at some future time. They were money. Since they were not borrowed, they didn’t add to the national debt. What later made them inflationary was they were used to pay for war – which didn’t produce or add anything productive to the economy to offset the added money supply. The bill contained an “Exception Clause”, which stated that Greenbacks could not be used to pay the interest on the national debt, nor to pay taxes, excises, or import duties. This maintained a demand and legitimacy for bank-issued debt money.
1863 – NATIONAL BANKING ACT PASSED
It provided for the national chartering of banks by the federal government. This replaced state charters – many of which contained much more rigid and democratic provisions. The Act in numerous ways standardized banking across the country. The act established National Banking Associations, the office of the Comptroller of the Currency, and a system of national chartered banks with control over all of them coming from Washington. The new banks were given virtaully tax free status. In doing so, it entrenched what some have called “structural fraud” of the banking system – creating money out of thin air and charting interest on it.
----------------
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
For more information, visit http://www.afsc.net/economiccrisis.html
Wednesday, February 15, 2012
Legalized Crime: Fed Bankers and the Creation of Debt-Money
I'm participating on this panel next month. Consider attending!
http://www.leftforum.org/panel/legalized-crime-fed-bankers-and-creation-debt-money
Left Forum, Saturday, March 17, 2012, New York City
Panel Proposal Information
Abstract:
"The most important fundamental law in any nation is that which institutes money; for money governs the distribution of property, and thus affects in a thousand ways the relations of man to man." -- EdwardKellogg, 1861. Today nearly 14 million Americans are unemployed, another12 million underemployed, 43 million Americans live below the poverty line, 49 million go to bed hungry at night, and an estimated 3 million Americans are homeless. The US Congress created the Federal Reserve in 1913 giving private bankers the power to create money which institutionalized debt slavery for American workers and caused the misery many of the 99% are experiencing today, This panel will review the history of the Fed Reserve creation and describe how this power to create money by private bankers has caused this suffering. Strategies for returning the Constitutional power to create money to the people for the benefit of all Americans will be discussed. With solidarity the present system can be changed to create a world of hope for all Americans.
Panel Topics:
Political Economy And The Current Crisis
Participants
Chair:
Name: Julia Willebrand View Details
Speakers:
Name: Sue Peters View Details
Name: Greg Coleridge View Details
Name: Steven Walsh View Details
http://www.leftforum.org/panel/legalized-crime-fed-bankers-and-creation-debt-money
Monday, February 13, 2012
How to Overthrow Corporate Rule in 5 Not-so-easy Steps
This is an excellent piece.
http://www.corporations.org/solutions/
Many people are spending a lot of their time volunteering to stop specific environmental threats, to address a specific labor issue, or to stop various other corporate abuses to our communities. The number of problems seems endless. Isn't there a faster way to save the world?
MONETARY HISTORY CALENDAR February 13-19
FEBRUARY 19
1869 CONGRESS PASSES BILL PROHIBITING USING UNITED STATES NOTES AS SECURITY OR COLLATERAL IN ANY LOAN MADE THROUGH A NATIONAL BANKING ASSOCIATION
“That no national banking association shall hereafter offer or receive United States notes or national bank notes as security or as collateral security for any loan of money…and any national banking association offending against the provisions of this act shall be deemed guilty of a misdemeanor and upon conviction thereof in any United States court having jurisdiction shall be punished by a fine…” Approved February 19 1869
This was one of many attacks by bankers on the Greenbacks – public money issued by the Lincoln Administration. Public control of the money system meant banks couldn’t control it. Banking corporations wanted, as they had done prior to and after Greenbacks, print money out of thin air and then charge interest on top of it (otherwise known as “debt money”). Banks pressured Congress in a variety of ways to delegitimize Greenbacks. This law was one such way.
NO OTHER ENTRIES THIS WEEK…HOWEVER IN COMMEMORATION OF THE ONE YEAR ANNIVERSARY OF THE “ARAB SPRING”
FROM THE KORAN (2: 275):
"Those who devour usury will not stand except as stands one whom the evil one by his touch hath driven to madness. That is because they say: 'Trade is like usury…but God hath permitted trade and forbidden usury."
Some features of Islamic banking principles (from the Associated Press, 1/2/97):
“Interest on deposits: Islamic banks pay no interest on deposits. Unlike fixed return promised by most Western banks, Islamic banks operate on principle of shared risk. Depositors can choose an account that guarantees their money but pays no dividend, or one that acts like an investment fund. Depositors in investment accounts share in the bank's profits, but risk losing money if its investments perform poorly.
Interest on loans: Islamic banks charge no interest on loans. Instead of lending money to commercial borrowers at fixed rate of return, Islamic bankers become partners, sharing in venture's profits and losses. Some Islamic banks also make mortgage loans, charging flat fees payable in monthly installments, with costs similar to traditional mortgages. But loans have no compound interest or late-payment charges, and borrowers are spared uncertainty of variable interest rates common in Western nations.”
----------
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
For more information, visit http://www.afsc.net/economiccrisis.html
1869 CONGRESS PASSES BILL PROHIBITING USING UNITED STATES NOTES AS SECURITY OR COLLATERAL IN ANY LOAN MADE THROUGH A NATIONAL BANKING ASSOCIATION
“That no national banking association shall hereafter offer or receive United States notes or national bank notes as security or as collateral security for any loan of money…and any national banking association offending against the provisions of this act shall be deemed guilty of a misdemeanor and upon conviction thereof in any United States court having jurisdiction shall be punished by a fine…” Approved February 19 1869
This was one of many attacks by bankers on the Greenbacks – public money issued by the Lincoln Administration. Public control of the money system meant banks couldn’t control it. Banking corporations wanted, as they had done prior to and after Greenbacks, print money out of thin air and then charge interest on top of it (otherwise known as “debt money”). Banks pressured Congress in a variety of ways to delegitimize Greenbacks. This law was one such way.
NO OTHER ENTRIES THIS WEEK…HOWEVER IN COMMEMORATION OF THE ONE YEAR ANNIVERSARY OF THE “ARAB SPRING”
FROM THE KORAN (2: 275):
"Those who devour usury will not stand except as stands one whom the evil one by his touch hath driven to madness. That is because they say: 'Trade is like usury…but God hath permitted trade and forbidden usury."
Some features of Islamic banking principles (from the Associated Press, 1/2/97):
“Interest on deposits: Islamic banks pay no interest on deposits. Unlike fixed return promised by most Western banks, Islamic banks operate on principle of shared risk. Depositors can choose an account that guarantees their money but pays no dividend, or one that acts like an investment fund. Depositors in investment accounts share in the bank's profits, but risk losing money if its investments perform poorly.
Interest on loans: Islamic banks charge no interest on loans. Instead of lending money to commercial borrowers at fixed rate of return, Islamic bankers become partners, sharing in venture's profits and losses. Some Islamic banks also make mortgage loans, charging flat fees payable in monthly installments, with costs similar to traditional mortgages. But loans have no compound interest or late-payment charges, and borrowers are spared uncertainty of variable interest rates common in Western nations.”
----------
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
For more information, visit http://www.afsc.net/economiccrisis.html
Monday, February 6, 2012
MONETARY HISTORY CALENDAR - February 6-12
FEBRUARY 7
1870 HEPBURN V GRISWOLD US SUPREME COURT DECISION
The Court declared that certain parts of the passed Congressional Legal Tender acts in the 1860’s were unconstitutional. The Legal Tender acts authorized the government to issue paper money, “Greenbacks,” and recognized it as legal to meet financial obligations. The Court concluded, however, that a party to a contract could not use paper money as payment for a debt if the contract stipulated gold or silver as payment. The Court explained how the US Congress possessed the power to coin money, but that that power was different than the power to made paper money legal.
FEBRUARY 11
1847 – BIRTH OF THOMAS EDISON, US INVENTOR
“If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good makes the bill good... If the Government issues bonds, the brokers will sell them. The bonds will be negotiable; they will be considered as gilt edged paper. Why? Because the government is behind them, but who is behind the Government? The people. Therefore it is the people who constitute the basis of Government credit. Why then cannot the people have the benefit of their own gilt-edged credit by receiving non-interest bearing currency… instead of the bankers receiving the benefit of the people’s credit in interest-bearing bonds?”
2004 – RON PAUL, US CONGRESSMAN, SPEAKING TO THE HOUSE FINANCIAL SERVICES COMMITTEE
He referred to the Federal Reserve by stating, "maybe there's too much power in the hands of those who control monetary policy? The power to create the financial bubbles. The power to maybe bring the bubble about. The power to change the value of the stock market within minutes. That to me is just an ominous power and challenges the whole concept of freedom and liberty and sound money."
FEBRUARY 12
1791 – BIRTH OF PETER COOPER, US INDUSTRIALIST, PHILANTHROPIST (FOUNDED COOPER UNION) AND GREENBACK CANDIDATE FOR PRESIDENT
"The substitution of greenbacks for National bank notes, would have the bounty now paid to banks, which, being invested as a sinking fund, would in less than thirty years pay off the whole debt of the country.”
1809 – BIRTH OF ABRAHAM LINCOLN, 16TH PRESIDENT OF THE UNITED STATES
“The money power preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than bureaucracy.”
Under Lincoln’s administration, the US Government issued 450 million “Greenbacks” – interest and inflation free government-issued currency. They weren’t government bills, bonds or any other debt-bearing notes. They were actual US-based money.
“The privilege of creating and issuing money is not only the supreme prerogative of government, but it is the government’s greatest creative opportunity. The financing of all public enterprise, and the conduct of the treasury will become matters of practical administration. Money will cease to be master and will then become servant of humanity.”
1873 – COINAGE ACT PASSED BY CONGRESS (THE “CRIME OF ‘73”)
The Coinage Act removed silver as a form of currency (“demonetized) – leaving gold as the major form of US currency. The public didn’t realize at first what happened. With silver no longer a form of money, the overall amount of currency dramatically declined, causing the prices farmer’s received for their produce to drop (deflation) but the cost of their debts rise. Thousand of famers lost their land. Those who held silver also suffered. This was one of the sparks of the rise of the farmer-led US Populist movement.
______________________________________________________________________________________
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
1870 HEPBURN V GRISWOLD US SUPREME COURT DECISION
The Court declared that certain parts of the passed Congressional Legal Tender acts in the 1860’s were unconstitutional. The Legal Tender acts authorized the government to issue paper money, “Greenbacks,” and recognized it as legal to meet financial obligations. The Court concluded, however, that a party to a contract could not use paper money as payment for a debt if the contract stipulated gold or silver as payment. The Court explained how the US Congress possessed the power to coin money, but that that power was different than the power to made paper money legal.
FEBRUARY 11
1847 – BIRTH OF THOMAS EDISON, US INVENTOR
“If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good makes the bill good... If the Government issues bonds, the brokers will sell them. The bonds will be negotiable; they will be considered as gilt edged paper. Why? Because the government is behind them, but who is behind the Government? The people. Therefore it is the people who constitute the basis of Government credit. Why then cannot the people have the benefit of their own gilt-edged credit by receiving non-interest bearing currency… instead of the bankers receiving the benefit of the people’s credit in interest-bearing bonds?”
2004 – RON PAUL, US CONGRESSMAN, SPEAKING TO THE HOUSE FINANCIAL SERVICES COMMITTEE
He referred to the Federal Reserve by stating, "maybe there's too much power in the hands of those who control monetary policy? The power to create the financial bubbles. The power to maybe bring the bubble about. The power to change the value of the stock market within minutes. That to me is just an ominous power and challenges the whole concept of freedom and liberty and sound money."
FEBRUARY 12
1791 – BIRTH OF PETER COOPER, US INDUSTRIALIST, PHILANTHROPIST (FOUNDED COOPER UNION) AND GREENBACK CANDIDATE FOR PRESIDENT
"The substitution of greenbacks for National bank notes, would have the bounty now paid to banks, which, being invested as a sinking fund, would in less than thirty years pay off the whole debt of the country.”
1809 – BIRTH OF ABRAHAM LINCOLN, 16TH PRESIDENT OF THE UNITED STATES
“The money power preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than bureaucracy.”
Under Lincoln’s administration, the US Government issued 450 million “Greenbacks” – interest and inflation free government-issued currency. They weren’t government bills, bonds or any other debt-bearing notes. They were actual US-based money.
“The privilege of creating and issuing money is not only the supreme prerogative of government, but it is the government’s greatest creative opportunity. The financing of all public enterprise, and the conduct of the treasury will become matters of practical administration. Money will cease to be master and will then become servant of humanity.”
1873 – COINAGE ACT PASSED BY CONGRESS (THE “CRIME OF ‘73”)
The Coinage Act removed silver as a form of currency (“demonetized) – leaving gold as the major form of US currency. The public didn’t realize at first what happened. With silver no longer a form of money, the overall amount of currency dramatically declined, causing the prices farmer’s received for their produce to drop (deflation) but the cost of their debts rise. Thousand of famers lost their land. Those who held silver also suffered. This was one of the sparks of the rise of the farmer-led US Populist movement.
______________________________________________________________________________________
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system, been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt?
Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice.
This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis and Greg Coleridge helped in its development.
Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com
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