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The Federal Money Tree

“Congress simply isn’t doing enough yet. Conditional assistance tied to work or a single stimulus check are not — and frankly never have been — enough to protect Americans from economic insecurity.

“What we need in this moment to meet the need and help families who are struggling is a Covid-19 guaranteed income, with direct, recurring cash payments for all Americans — including immigrants — that last at least until the economic hardship of this public health crisis ends. A form of Universal Basic Income, this guaranteed income is unconditional, won’t interfere with other social safety net benefits and would help give Americans an income floor during a time of great economic instability.”  —  Michael Tubbs and Melvin Carter, “One more stimulus check from Congress won’t be enough. This is what will really help,” CNN Business Perspectives, 8-21-20

Most Americans undoubtedly recognize that states don’t have money trees.  But many take it for granted that the Federal government has a wealth tree and can dispense wealth at will.  And if it doesn’t, it’s just being stingy.

The truth is that the federal money tree is a very real threat to our freedom and prosperity.  And government created economic devastation, ostensibly in response to pandemic crisis, is being used as the pretext for a drastic inflation of our currency.

The above cited article was written by two city mayors – Michael Tubbs, mayor of Stockton, California and Melvin Carter, mayor of Saint-Paul, Minnesota.  As an opinion piece, it was disclaimed by CNN Business as not representing the views of CNN.

However, in a related CNN Politics article, “‘A growing sense of panic’ with no fresh federal relief in sight,” 8-19-20, CNN seems also to support more federal spending as the right thing to do:

There’s support from both sides of the aisle to send a second round of checks, extend at least some unemployment benefits and allow small businesses to apply for another loan so that they can pay their workers. But Republicans … and Democrats … remain far apart on the details even after weeks of talks in July.

Millions of people are still unemployed
The package of financial aid that Congress passed in March got money to people fairly quickly at a time when lawmakers didn’t expect the pandemic to last as long as it has….  But the economy is far from recovered.

By the end of June 2020, our national debt stood at $26.5 trillion — an increase of almost $3 trillion in the previous six months — the fastest rise in history!

Intended Destruction
The remedy for one destructive act — government shutdown of the economy — is not another destructive act — wild inflation of our nation’s currency.   Some history is needed to understand how and why the federal government got a money tree.   But first we recall what should have been an early warning re inflation’s destructive consequences.

In his 1920 The Economic Consequences of Peace, Internationalist conspirator and British Fabian Socialist John Maynard Keynes wrote:

Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens….

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

The Federal Reserve Act
In 1910, international bankers from Wall Street convened a highly secret meeting at Jekyll Island, Georgia and came up with a scheme to gain control of our nation’s money.  It was originally introduced in Congress as the Aldrich Plan, but Senator Nelson Aldrich of Rhode Island was too clearly connected to the international bankers, and for that and other reasons his bill went down to defeat.

However, after the 1912 elections, the essence of that plan was reintroduced as the Federal Reserve Act.  Congress passed the Act on December 22, 1913 during its rush to adjourn for Christmas.  Insider-controlled President Woodrow Wilson signed it into law the next day.

During the Act’s consideration in the House of Representatives, the great American statesman Charles A. Lindbergh Sr. (father of the famous aviator) addressed his colleagues as follows:

This act establishes the most gigantic trust on earth …. When the President signs this act the invisible government by the Money Power, proven to exist by the Money Trust investigation, will be legalized ….
This is the Aldrich Bill in disguise ….
The new law will create inflation whenever the trusts want inflation….

After more than a century, Lindbergh’s prediction has come home to roost — big time.  In recent years, the only thing preventing monetary inflation (to finance federal deficits) from becoming price inflation has been the willingness of other nations’ central banks, most notably Communist China’s, to hold our debt.  But this makes the U.S. susceptible to the actions of a hostile nation.  And according to an April 1 Bloomberg report, foreign holders have begun dumping the dollar as a result of the new explosion in U.S. debt.

A moment’s reflection should convince anyone that consumption requires production.   And no amount of currency inflation can substitute.   Money won’t put food on our tables, if food is not produced.

Solution
The destruction of America will continue as long as a misinformed public is vulnerable to the deceptions of those seeking tyrannical power.

The solution starts by creating understanding among grassroots patriots regarding the deceptions of the Insider-controlled media in support of a cabal of power seekers.  Much of what needs to be understood is recorded in Freedom First Society’s Masters of Deception — The Rise of the Council on Foreign Relations.

But to bypass the media and create sufficient public pressure on Congress to roll back decades of entrenched subversion, it will take the tough leadership of an informed grassroots organization.  Of course, we recommend Freedom First Society.

Where’s the Data, Dr. Fauci?

“President Donald Trump may want to reopen the U.S. economy by Easter — but the novel coronavirus wreaking havoc across the globe may have other plans.

“Dr. Anthony Fauci, the country’s top infectious disease expert, pointed out Wednesday that the virus is determining ‘the timeline’ for the pandemic.

“‘You’ve gotta be realistic,’ Fauci told CNN’s Chris Cuomo…. ‘You’ve got to understand that you don’t make the timeline, the virus makes the timeline….

“‘You can’t make an arbitrary decision until you see what you’re dealing with. You need the data.’” [Emphasis added.] — HuffPost, 3-26-20

Note:  On March 29, President Trump announced that he was extending the federal social distancing guidelines until April 30th.

Okay, Dr. Fauci, where’s the data?  I mean the data you used in the beginning to justify the unprecedented government decision to shutdown the economy?  Surely, you wouldn’t have accepted the notoriously unreliable Communist Chinese data?  Even the often quoted data from the UN’s World Health Organization can’t be trusted, because WHO has an agenda to reinforce the UN’s global power grab.

Indeed, where’s the data that the coronavirus is more deadly or more communicable than other infectious diseases that the world copes with every year without shutting down?  The American people deserve to know, particularly since the Internationalist Insiders dominating our government regularly use crises as pretexts for government to seize more unconstitutional power (see “Internationalist Treachery,” below).

Dr. Ron Paul

According to Dr. Ron Paul, a former U.S. Representative, Fauci “testified to Congress that the death rate for the coronavirus is ten times that of the seasonal flu, a claim without any scientific basis.”

We hear statistics about number of cases and deaths, but how to those compare with say, the flu, or tuberculosis?  Most Americans can’t readily make the comparison, and many cases of such diseases go unreported.   (The CDC estimated that during the 2018-2019 flu season, the flu killed 34,200 of about 35.5 million people infected.)

Scaring Us
In a March 16th open letter, Dr. Paul further charged: “The chief fearmonger of the Trump Administration is without a doubt Anthony Fauci, head of the National Institute of Allergy and Infectious Diseases at the National Institutes of Health. Fauci is all over the media, serving up outright falsehoods to stir up even more panic.”

And the impact of that panic is everywhere.  Congress just passed a $2.2 trillion rescue package, which The Hill (3-25-20) claimed was “the single largest stimulus package in the nation’s history.”  And that may be only a beginning.

The ostensible justification for the enormous addition to the national debt was to stimulate an economy that is in recession, not because of the coronavirus directly, but because of governments’ (federal, state, & local) response, using the hyped scare as justification for the unprecedented assumption of power.  Only a lesser portion of the rescue package was devoted to defense against the virus itself.

On March 29th, Dr. Fauci ramped up his warning dramatically. According to The Hill:

Speaking on CNN’s “State of the Union,” Fauci said that, based on what he’s seeing, the U.S. could experience between 100,000 and 200,000 deaths from Covid-19.

“We’re going to have millions of cases,” Fauci, the head of the National Institute of Allergy and Infectious Diseases, said, noting that projections are subject to change, given that the disease’s outbreak is “such a moving target.”

Unfortunately, his projections seemed to have been based on computer models, which even Dr. Fauci admitted were no better than the assumptions fed into them.

Internationalist Treachery
In evaluating the crisis claims, we have a right to demand proof, because for decades Internationalists have been employing evolving threats and scares to gain power — leading to global power, accountable only to them.

With the start of the Cold War, the threat was nuclear annihilation.  But that shifted with the break-up of the former Soviet Union.   As replacements, the Internationalists embraced new threats — drugs, terrorism, and environmental catastrophe — as pretexts for increasing the authority of International bodies.

In its November 24, 1997 issue, The New American magazine warned that Internationalists had adopted another alarmist threat — pestilence — to accomplish their aims. The report was entitled “Scaring Us Toward Global Government.”  Remember that the following assessments were written two decades before the world heard of a “coronavirus pandemic:”

In recent years, yet another alarmist refrain has been heard: “World government or pestilence!” This latest crisis requiring global management is the threat presented by supposedly new infectious diseases. Where once we were menaced by megatons, the danger now supposedly comes from microbes — and familiar voices are insisting anew that only world government can save humanity from destruction.

As a tool for manipulating public opinion, the threat of pestilence actually has an advantage over the earlier scare scenarios: Nuclear annihilation of humanity, while a horrifying prospect, is simply too abstract to have a visceral impact. The same is true of environmental collapse. But everybody has been sick and can individualize the horror of succumbing to an incurable disease. Thus, the pestilence scenario may have far more potential as a tool for selling the public on globalist “solutions.”

In November 1993, President Clinton set up, by Executive Order, the National Science and Technology Council, which included a Committee on International Science, Engineering, and Technology Policy (CISETP).

The New American article cited a CISETP report as an example of “the willingness of public policy elites to play off media-generated fears of infectious disease.” According to the report:  “[Th]e past few years have been marked by a recognition of renewed vulnerability to infectious diseases. Bestselling books and Hollywood thrillers have triggered public fascination with ‘new,’ deadly, and unpredictable microorganisms.”  The New American continued:

The report noted that protecting the health of the “global village” demands “a worldwide response,” and “recently, public discussion has been further focused on the global issue of emerging diseases by … popular movies such as ‘Outbreak,’ starring Dustin Hoffman.”…

In the miniseries Pandora’s Clock, an airliner bound for JFK Airport in New York has the misfortune to be carrying a passenger infected with a doomsday virus. The plane is not allowed to land, lest the virus be loosed, and the government plans to shoot the plane down instead — another effective pitch for the idea that crises must be dealt with through extreme measures.

CISETP’s eagerness to cite Outbreak and similar entertainment products typifies a distressing willingness on the part of some public health officials to focus on lurid scenarios at some expense to sound science. The average American is largely at the mercy of domestic and international public health bureaucracies for information about infectious disease. This trust has been abused by public health authorities in recent decades.

For a more recent example of this strategy at work, check out our  11-24-19 post “Crisis-Hyping — What’s At Stake!”

But perhaps, this time, the Internationalists do have a real crisis to drive their power grabs.  Perhaps. However, we also know that with sufficient focus, the Establishment media can make any problem, such as “gun violence,” appear to be a new pandemic.  And there are several reports circulating claiming that the coronavirus statistics are exaggerated.

Data Alone Fallacy
Dr. Fauci’s claim that the virus data alone should drive government policy is a dangerous position.   In particular, his claim supports the Internationalist Establishment’s agenda for totalitarian power.  As several have pointed out, when the threat passes, government doesn’t give us our freedoms back.   It insists that an ongoing threat warrants that government retain the new authority. As an example, consider the “temporary” surveillance authorities granted to government following 9/11 by the Patriot Act, now the U.S.A. Freedom Act.

The coronavirus, even if it deserves major attention, is by no means the only problem the public faces.  Human mortality has not been conquered.  In the meantime, the public deserves the opportunity to try and accomplish life’s goals, protected by government, not burdened by government-imposed “emergency” restrictions.

But most significantly, the arguments in favor of the government measures ignore the much more dangerous threat of a high-level Internationalist Conspiracy that lusts to expand government authority in perpetuity and is greedy for useful pretexts.

So if these Conspiracy Insiders have their way, this scare is not a onetime event.  Indeed, Dr. Fauci has warned:  “We really need to be prepared for another cycle” to hit later this year.  And what about next year?

Multiple Gains
Establishment Internationalists are reaping multiple gains from their “crisis.”   Alexander Hamilton pointed to a principal one:

Safety from external danger is the most powerful director of national conduct. Even the ardent love of liberty will, after a time, give way to its dictates…. [T]he continual effort and alarm attendant on a state of continual danger, will compel nations the most attached to liberty to resort for repose and security to institutions which have a tendency to destroy their civil and political rights. To be more safe, they at length become willing to run the risk of being less free. — The Federalist No. 8

Hamilton’s warning is even more valid today, when there is a major organized Conspiracy for total power at work determined to undo the American revolution.  But in addition to preparing the public to give up its rights and accept government domination, the Conspiracy gains in other ways.

A primary Conspiracy gain is the enormous addition to our national debt from massive government spending — more than 2 trillion dollars the government does not have.  The consequences (inflation) and potential consequences (destruction of the dollar and its replacement with an International currency) are huge topics in themselves.  Bloomberg just reported (4-1-20):

The Federal Reserve is trying to call time on a fire sale of Treasuries by foreign governments and central banks.

Foreign official holders of Treasuries dumped more than $100 billion in the three weeks to March 25, on course for the biggest monthly drop on record, according to weekly Fed custody data that captures much of the pandemic-fueled turmoil.

Another gain by power seekers is the destruction of small businesses, a pillar of a free market economy and of the middle class — a bulwark of freedom.   Many other small businesses are to be put in hoc to the federal government.  In an interview with Yahoo! Finance (published 3-31-20) Ivanka Trump, President Trump’s daughter and senior advisor, made the following observation:

“Small businesses employ close to 50% of the American workforce, and obviously are the most vulnerable from a cash flow situation,” she said.

The $2 trillion fiscal stimulus sets aside over $350 billion in loans for small businesses. “We want to just bridge people until the world reopens,” she said.

And last, and very alarming, the Leftwing Politico reports that the Trump administration has asked Congress to draft legislation that would allow it to suspend parts of the Constitution:

The Justice Department has quietly asked Congress for the ability to ask chief judges to detain people indefinitely without trial during emergencies — part of a push for new powers that comes as the novel coronavirus spreads throughout the United States.

Documents reviewed by POLITICO detail the department’s requests to lawmakers on a host of topics, including the statute of limitations, asylum and the way court hearings are conducted  — “DOJ seeks new emergency powers amid coronavirus pandemic,” 3-21-20

If It Ain’t Broke, Don’t Fix It!

Pity the poor proponents of an Article V con-con. How could they ever have happy holidays?

For they are self-impaled on the horns of a brutal dilemma. They must argue either:

  • that amending our Constitution will somehow, magically, turn Constitution-despising government officials into Constitution-obedient ones; or else,
  • that the Constitution, as it stands, has some significant flaws that have allowed the federal government to get “out of control.”

Very oddly, though, despite such a daunting dilemma you never see a con-con proponent backing off from his or her insistence that we must amend our Constitution — and, that it needs to be done through a (colossally dangerous) Article V constitutional convention! Only this magic (albeit never-before-used) formula will save us from our “out of control” government, they keep saying.

Take, for example, the odd insistence of Mr. Nick Dranias.

Nick Dranias’s criticism of the U.S. Constitution

Mr. Dranias, who leads Compact for America, has apparently enough sense to realize that though proving the second point (flaws in the Constitution) would be a formidable challenge, proving the first is clearly impossible. He has thus, almost alone, taken on the challenge of proving that our Constitution is to blame for our bloated federal government.

Unfortunately, Dranias’s case rests on a misconstrual of the Constitution and of the history of our federal government’s borrowing and spending.

According to Dranias (on his Compact for America website), “The Constitution as it exists fully authorizes unlimited spending, taxing and borrowing in support of the enumerated powers.”

He adds quickly, “Of course, the federal government is doing much much more than what the Founders thought the enumerated powers authorized. But that is politically inevitable when you give elected officials an unlimited credit card with which they can promise anything to get elected at no immediate cost to current voters!”

Dranias is very fond of using this phrase “unlimited credit card” to describe the Constitution’s lack of explicit limitation on federal-government borrowing. He means, apparently, that they can borrow as much as they want, at any time, with no penalties felt at all soon.

The metaphor is clever but misleading. A look at the actual historical data on U.S. federal government debt makes clear how misleading it is.

How did we REALLY get our mountain of national debt?

If the Constitution is an “unlimited credit card” that allows Congressmen to buy their way to re-election, how does Mr. Dranias explain the fact that our national debt was relatively under control until the Vietnam War was winding down, and then suddenly exploded in the early 1970s?

Even though there was concern over our growing national debt before the 1970s, compared to today’s enormous debt, the debt was miniscule. Although it grew significantly during World War II, a time-chart of the debt will show that it grew practically none between 1945 and 1970. Not until the early 70s did our debt begin its exponential climb to its current astronomical heights.

Why was that? Were U.S. Congressmen generally so obtuse before 1971 or so, that they never noticed the Constitution gives them an “unlimited credit card” with which to buy votes? Or were they perhaps all angelic statesmen, before that time, who kept to the Constitution’s spending-bounds out of the goodness of their hearts?

Or, was there perhaps something that happened in the early 70s that opened the spigot for unlimited government borrowing? There was indeed: On August 15, 1971, President Richard Nixon made a catastrophic structural change to our monetary and banking system. This change allowed for virtually unlimited creation of (new) money by the Federal Reserve System, to lend to the government (at below-market-level interest rates).

For it was on that date that Nixon “shut the gold window” to foreigners,

refusing to let foreign central banks redeem their dollars for gold, facilitating the devaluation of the U.S dollar which had been fixed relative to gold for almost thirty years. While not strictly a default on a US debt obligation, by closing the gold window the US government abrogated a financial commitment it had made to the rest of the world at the Bretton Woods Conference in 1944 that set up the post-war monetary system. At Bretton Woods, the United States had promised to redeem any and all U.S. dollars held by foreigners — later limited to just foreign central banks — for $35 dollars an ounce. This promise explains why the Bretton Woods monetary system was called a “gold exchange standard” and why many believed the US dollar to be “as good as gold.” (http://triplecrisis.com/a-first-default-closing-the-gold-window/)

Redeemability is what a “bank note” is all about: It is simply a bank’s I.O.U. for the bearer’s “demand deposit” of true, commodity money (namely gold, in this case). It is understood to be strictly redeemable in that money, on demand, to whomever is bearing the note.

Perusal of a 1934 Federal Reserve 10-dollar note, for example, shows that the note declares it is “legal tender for all debts, public and private, and is redeemable in lawful money [initially, actual dollars, of gold or silver, or redeemable U.S. Treasury Gold or Silver Certificates] at the United States Treasury, or at any Federal Reserve Bank.” It states further that “The United States of America will pay to the [note’s] bearer on demand Ten Dollars.” (interpolations in square brackets ours.)

President Franklin Roosevelt had already “shut the gold window” to U.S. citizens back in 1933, allowing the banks to forego honoring their commitment to redeem the notes in gold (or Gold Certificates). But at that time they were still exchangeable for U.S. Treasury-issued Silver Certificates; and those were redeemable, in silver coins.

Then in 1968, President Johnson and Congress had nullified the pledge to redeem the Silver Certificates — again, for U.S. citizens only. But not until Nixon “shut the gold window” to foreigners also in 1971, were U.S. “dollars” — including, paper Federal Reserve “Notes” — completely unshackled from redeemability in precious metal.

Did that major change indeed open the spigot for creation of Federal Reserve paper “dollars”? Yes, of course: If banks no longer have to redeem their “notes” at all, yet those notes are “legal tender,” they will really go to town with their “money”-printing presses! They’ll be more than happy and ready to loan these fraudulent paper “notes” into circulation.

One may readily confirm that that is what has happened, by glancing at a time-chart of the M3 U.S. “money” supply: Clearly it was right around 1971 that our supply of (paper) “money” began to increase by leaps and bounds. Before then, the “money” supply was somewhat limited by the gold supply in the Federal Reserve’s vaults.

Did the Constitution permit this debt disaster?

So, is Mr. Dranias correct, in blaming our national-debt disaster on the Constitution? No — unless the Constitution permits government to declare irredeemable paper money a “legal tender” in payment of debts. For only if they are declared “legal tender” must such fraudulent, irredeemable and therefore essentially worthless notes be accepted as real “dollars,” when the government (or anyone else) offers them in payment of a “dollar”-denominated charge or obligation.

But in fact, not only does the Constitution not permit this; it forbids it. At the time of its ratification, the states had created an inflationary crisis by declaring a burgeoning mountain of irredeemable bank notes “legal tender.” This is why the Constitution forbade states to “make any thing but gold and silver coin a tender in payment of debts” (Art. 1, Sec. 10). That provision brought an end to the inflation.

Naturally, the Founders would not have permitted the federal government to step in and re-create this disaster of worthless “legal tender.” But they did not feel it needful to state explicitly that the federal government is (with the states) forbidden to do this, since (as the Tenth Amendment says) any power not explicitly delegated to the federal government, by the Constitution, is understood not to be granted to it.

Thus the Constitution also did not permit the government to take these other actions that were crucial in its drive to substitute paper, irredeemable currency for our sound money:

  • creation of the Federal Reserve System, in 1913;
  • “shutting the gold window” to U.S. citizens, in April 1933;
  • forbidding them, at that same time, to own or use monetary gold; and
  • the final, complete repudiation of our currency’s redeemability, in 1968 and 1971.

So it turns out that, thru his misdirecting of the blame, Mr. Dranias is implicitly exonerating our leaders and the Fed, and irresponsibly risking our liberty. For the Constitution is not the problem. Disobedience to the Constitution is!

Tragically, the constitutional requirement to limit government to its enumerated powers has virtually disappeared from media-led political discussion, in favor of a dangerous “how much can we afford?” debate. Without an informed electorate forcing its representatives to adhere to the Constitution, the government’s substitution of irredeemable Federal Reserve bank notes for our once-sound monetary system has supported a massive explosion in the national debt. Our need is not to alter, but to return to, that wisely crafted form of government that our Founders outlined so clearly.

Federal Reserve Hypocrisy

International response to European debt problems” (5/20/2010)

FFS:  FRB testimony by Daniel K. Tarullo (CFR) before the Subcommittee on International Monetary Policy and Technology, U.S. House of Representatives, Washington, D.C.

Member of the Federal Reserve Board of Governors Daniel K. Tarullo insists “that every country with sustained budget deficits and rising debt —  including the United States — needs to act in a timely manner to put in place a credible program for sustainable fiscal policies.” How about merely adhering to the U.S. Constitution?  “Fiscal conservative” Tarullo formerly served on the staff of the late Senator Ted Kennedy.  Central banks regularly extend easy credit to governments, by inflating a nation’s currency, and then demand restraint after the countries get in trouble.

Obama Reappoints “Counterfeiter Ben”

On August 25, President Obama announced that he was reappointing Ben Bernanke to a second four-year term as Chairman of the Federal Reserve. The media hype accompanying the nomination reinforced dangerous illusions aiding a subversive agenda.

Managing Money and Markets

Following the Obama announcement, Time.com issued a puff piece, “Why Obama Reappointed Bernanke to the Fed,” extolling the heroic accomplishments and talents of “Fireman Ben.” In particular, Time.com (along with Obama and others) praised Bernanke’s deep study of the causes of the Great Depression:

So when the financial markets melted down in 2008, [Bernanke] vowed to avoid the errors of omission the sluggish Fed had made in the 1930s and do everything possible to prevent the crisis from becoming a calamity. He blasted a fire hose full of dollars at the U.S. economy, exercising unprecedented powers and sidestepping the democratic process, figuring that desperate times called for desperate measures.

But, we might ask, what caused the desperate times? And why was blasting “a fire hose full of dollars at the U.S. economy” an appropriate response or function of government?

The primary victim of such monetary and economic meddling has been the middle class. On August 6th, CNNMoney.com warned: “Nearly half the nation’s mortgage borrowers will soon owe more on their mortgages than their homes are worth, according to a new report.” One of the researchers for the report noted: “That’s a dramatic shift from the past several decades when housing was the foundation of middle class wealth.”

For those interested in an honest history of the Great Depression, uncontaminated by central banking mythology, we highly recommend America’s Great Depression. In this classic 1963 analysis, free market economist Murray N. Rothbard showed that conventional “wisdom” had the cause and cure of the depression backwards. The Insiders promoting this same “wisdom” today insist that the free market causes these problems and that enlightened government intervention is the essential cure.

Time.com is far from alone in promoting the idea that a modern economy must be managed to avoid disaster. But now we are told that in a crisis even such management may not be enough, unless an extremely clever, courageous individual sits at the helm:

A July 6th report by CNNMoney.com, entitled “Bernanke’s $1 trillion hangover,” examined the challenge of weaning “the economy off the $1 trillion of new money created by the Fed when disaster loomed last fall. ‘Your timing has to be perfect,’ said David Jones, former Fed economist and president and CEO of DMJ Advisors LLC in Denver. ‘If you do it too soon [i.e., stop inflating the money supply], you keep us in recession. And if you do it too late, you get inflation.'”

What few media reports mention is that in the process of spreading new money all over town, the Fed dilutes the value of all money, just as does a counterfeiter. And in the process it confiscates and redistributes wealth. The new money enriches some Americans [the earlier recipients] at the expense of those on fixed incomes and later recipients of the new money. And the value of all savings is eroded.

Deceptive Posturing

The Establishment media are presenting Bernanke as not tied to Wall Street (“a financial overlord from Main Street rather than Wall Street” – Time.com). And President Obama suggests the same:

“We have already seen how lax enforcement and weak regulation can lead to enormous wealth for a few and enormous pain for everyone else,” Obama said. “And that’s why even though there is some resistance on Wall Street from those who prefer things the way they are, we will pass the reforms necessary to protect consumers, investors, and the entire financial system.”

But it is an illusion to believe that anyone is selected to head up the Fed unless he has the confidence of the international bankers. In fact, before anyone is too comforted by the president’s assurances, we should recall the clever deception used to pass the Federal Reserve Act in the first place.

The Federal Reserve Act was originally presented to Congress as the Aldrich bill. The bill, which had been drafted by the international bankers at the J.P. Morgan estate on Jekyll Island, was defeated in 1911, because Senator Nelson Aldrich was too closely identified with Wall Street.

So when Woodrow Wilson was elected, with strong J.P. Morgan support, the bill was simply reintroduced as the Glass Act (named for Senator Carter Glass, a critic of the Aldridge bill). But this time it was presented as a tool for fighting Wall Street, and it passed both Houses of Congress on December 22, 1913!

During the debates, Congressman Charles A. Lindbergh, who had courageously opposed the schemes of the international bankers, warned his colleagues: “This is the Aldrich bill in disguise…. This new law will create inflation whenever the trusts want inflation….”

What few Americans realize today is that it was the advent of a centralized banking system (The Federal Reserve) controlling our money supply (and the value of the dollar) that has enabled federal spending to explode. Politicians could henceforth spend beyond their willingness to tax Americans directly. Government simply sells its debt to the Federal Reserve, which purchases the debt with new money. Taxpayers still bear the brunt of government spending (when the value of the dollars they hold erode and prices go up in the marketplace), but they are less likely to attribute their pain to Washington.A sweet deal for big-spending politicians, but a big drain on America’s vitality and an invitation to disaster!

A Convenient Scapegoat

In trying to claim moral superiority while trashing constitutional limits on federal power, the Obama administration likes to paint its opponents as opposed to progress and wedded to the status quo. We offered one example above from the president: “And that’s why even though there is some resistance on Wall Street from those who prefer things the way they are….”

But a few days earlier, David Axelrod, Senior Advisor to the President, used very similar words in defending the administration’s plans for expanding federal control of the entire health care industry (through national universal health insurance):

We knew going into this effort that accomplishing comprehensive health insurance reform wasn’t going to be easy. Achieving real change never is. The entrenched interests that benefit from the status quo always use their influence in Washington to try and keep things just as they are.

It is deceptive to portray those who oppose the radical socialist transformation of society and the building of unlimited government as forces opposed to progress. Many who oppose Obama’s idea of change do not revere the status quo. They want a different kind of change – get the government out of the way of real progress and stop the collectivist stranglehold on American industry, ingenuity, and the economy.

We understand that the American revolution of 1776 established a new principle – that government power must be limited in order for the people to enjoy the fruits of freedom.

What Obama is proposing is a return to the “glories” of state power that mired Europe for centuries and from which America fortunately escaped.

Bipartisan Sycophants

We have pointed many times to evidence that the Insiders control the administrations of both of the major political parties. The media perpetuated notion that modern presidents march to the tune of the people who elected them is simply a useful myth that camouflages the real power brokers. Nowhere is a president’s subservience more solid than in his relationship to one of the Insiders’ most important creations – the Federal Reserve. As CNNMoney.com pointed out:

Over the past three decades, the country has had only three Fed chairmen. New presidents have tended to keep Fed chiefs in place regardless of political party to maintain continuity in monetary policy and confidence in markets. Paul Volcker was appointed by President Carter in 1979 and retained by Ronald Reagan. Alan Greenspan, a 1987 Reagan appointee, served under four presidents including President Clinton. Bernanke, 55, was appointed to the top job in 2006 by President George W. Bush, after serving as Bush’s chair of the Council of Economic Advisors.

One might expect this evidence of bi-partisan “cooperation” and same-thinking to raise suspicions regarding “Wall Street” influence – particularly, in light of the Fed Chairman’s massive authority and independence. According to the Time article:

The Fed chairman is often described as the second most powerful U.S. official; the main check on him is the first most powerful official’s power not to reappoint him.

If you are one of those concerned about this exercise of unaccountable power we highly recommend reading The Marxist Attack on the Middle Class.

Economic Insanity or Design?

In the following video clip, former U.S. Senator Fred Thompson makes clever use of satire to expose the folly of current economic proposals. [View Thompson video clip.] His insightful satire is right on the mark and worth sharing, IF it is supplemented with leadership regarding what to do about the problem (see below).

Thompson argues forcefully and correctly that the “medicine” being widely offered to get us out of our economic mess is the same “medicine” that got us in the mess. The president-elect, in particular, regularly avoids discussing what policies brought on our economic problems. Otherwise, his insistence that government spending is the cure would appear ridiculous.

As much as we admire the cleverness of the Thompson video clip, it suffers from two vital omissions: It doesn’t answer why politicians and economic “experts” behave the way they do, and it doesn’t suggest what must be done to fix that horrible situation. These two issues are critically important; otherwise we just laugh or cry or, worse yet, pursue ineffective solutions through partisan politics, as we continue toward disaster.

Why do we have this problem?

No short answer to that question would be credible, because the American people have been bombarded with so much misinformation.

Certainly, part of the driving force is supplied by politicians who seek more government spending as the route to their re-election. But the problem goes much deeper than that.

We are facing a dangerously incorrect illusion — that the driving force for expanding government spending and authority has the interests of the people at heart. In fact, that driving force has operated through deception and targets our middle class and even our liberties. Here are two nuggets hinting at the deeper problem:

• Government got the power to inflate the money supply (and control of the so-called currency printing press, referred to by Senator Thompson) through the creation of the Federal Reserve System in 1913.

In 1910, the members of the National Monetary Commission, established to address credit and banking problems of that day, held a secret meeting at the Jekyll Island Hunt Club owned by J.P. Morgan. One of the attendees, Frank Vanderlip, President of Kuhn-Loeb’s National City bank, admitted decades later (in a February 9, 1935 Saturday Evening Post article, “Farm Boy to Financier”):

“[T]here was an occasion, near the close of 1910, when I was as secretive — indeed as furtive — as any conspirator. I do not feel it any exaggeration to speak of our secret expedition to Jekyll Island as the occasion of the actual conception of what eventually became the Federal Reserve System…. Discovery, we knew, simply must not happen….”

• And in the April 1958 issue of American Opinion, the late great patriot Robert Welch discussed a subversive agenda being promoted under the pretext of fighting Communism. That agenda included:

“(1) Greatly expanded government spending … for every conceivable means of getting rid of ever larger sums of American money as wastefully as possible….

“(3) An increasingly unbalanced budget, despite the higher taxes.

“(4) Increasing and ever more rapid inflation of our currency, leading … to its ultimate worthlessness and complete repudiation.”

What to do about it

We highly recommend reading Organize for Victory! Organize for Victory! opens with a more complete analysis of what ails us, providing many authoritative references. It then offers a solution. The two topics really depend on each other. Only if the agendas and influence of those who would destroy our Republic are understood, combined with an understanding of our inherited constitutional strengths, can one appreciate the type of organization and commitment necessary to preserve liberty.