Debt money and the buzzing of flies
For the past three weeks, we have discussed the questions
Senators Elizabeth Warren and Bernie Sanders intend to ask the next nominee for
Federal Reserve Chairman. The
conversation has been a bit "out there," in that the discussion has been about
"big banking" and doesn't seem to be about life right here in little, old
Fairfield. This point was brought home
to me last Tuesday by an old friend who stopped me in the Home Depot to
complain about our sluggish economy and, for some reason, he was especially upset
about the retirement plans of our local government workers. "Vallejo went bankrupt because of that," he
informed me. "Ok, I get that," I
replied, "but the two trillion dollars we just gave to the bankers would have
paid for all levels of government workers' retirement plans, throughout the
United States, without any employee contributions, for the next hundred
years." I'll admit that I just pulled
that factoid out of my Arsenal of Spurious Statistics, but it just might be
true. Two trillion dollars has an awful
lot of zeros. That amount of money puts
into perspective the petty political problems usually discussed here in the Daily
Republic, on talk radio, on TV, and in Congress. They are minor irritants compared to the most
basic financial dysfunction we are suffering from in America: Debt Money. It seems we delight in complaining about the
buzzing of flies, circling above our mortal wounds.
Our national currency is based on debt because every penny in
circulation is loaned to us by bankers, rather than being issued, debt-free, by
our Treasury Department. Usually, this
system works just fine. Day to day, we
labor at our jobs, make money, buy a home, raise our families, and grow ever older. But, every twenty or thirty years, there seems
to be some banking crisis that contracts our available money supply and completely
guts our nation's economy. It happened
in 1837, 1857, 1873, 1893, 1907, 1920, the entire 1930's, the 1980's, and in
2008. Whole generations of Americans
have worked hard their entire lives, only to have some far-removed, ethereal
banking problem wipe them out. Lifetimes
of labor are erased in the blink of an eye as homes and businesses are
boarded-up and property is returned to the bank to be recycled for the next
generation of bankers to sell to the next generation of workers.
Along with violent money supply fluctuations, having our
national currency loaned to us by bankers creates our National Debt. While politicians continually argue about our
National Debt, they never mention that if we didn't have to borrow every penny
of our currency, we wouldn't have that debt in the first place. How many political discussions have you heard
mention that it is actually impossible to pay off our National Debt? Or, if we tried to pay it down, that our
nation's money supply would contract and America's economy would spiral downward
into a depression? How many times have
you heard anybody suggest that it's probably a bad idea to borrow every penny
we have in circulation or that our U.S. Treasury should instead issue our
nation's money, debt-free? We taxpayers
pay hundreds of billions of dollars in interest on our nation's money every single
year and those wasted tax dollars purchase us absolutely nothing.
When I first started writing this column for the Daily
Republic two years ago, I didn't know how much time I had to talk to you, so the
first thing I wrote about was the most important problem we Americans faced: Debt
Money. It's time we revisited that
story.
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