Dennis Kucinich gives us a September 'back to school' kick off
embedded in his newsletter:
The Bailout and What's Next
"We are at a teachable moment on matters of money and finance."
"Here is a very quick explanation of the $700 billion bailout within
the context of the mechanics of our monetary and banking system:
The taxpayers loan money to the banks. But the taxpayers do not have
the money. So we have to borrow it from the banks to give it back to
the banks. But the banks do not have the money to loan to the
government. So they create it into existence (through a mechanism
called fractional reserve) and then loan it to us, at interest, so we
can then give it back to them.
This is the system. This is the standard mechanism used to expand the
money supply on a daily basis not a special one designed only for the
"$700 billion" transaction. People will explain this to you in many
different ways, but this is what it comes down to.
The banks needed Congress' approval. Of course in this topsy turvy
world, it is the banks which set the terms of the money they are
borrowing from the taxpayers. And what do we get for this
transaction? Long term debt enslavement of our country. We get to pay
back to the banks trillions of dollars ($700 billion with compounded
interest) and the banks give us their bad debt which they cull from
everywhere in the world. ...
The globalization of the debt puts the United States in the position
that in order to repay the money that we borrow from the banks (for
the banks) we could be forced to accept International Monetary Fund
dictates which involve cutting health, social security benefits and
all other social spending in addition to reducing wages and
exploiting our natural resources. This inevitably leads to a loss of
economic, social and political freedom.
Under the failed $700 billion bailout plan, Wall Street's profits are
Wall Street's profits and Wall Street's losses are the taxpayers'
losses. Profits are capitalized. Losses are socialized.
... In the coming days and weeks, I will share with you thoughts
about what can be done to take us not just in a new direction, but in
a new direction which is just."
Thank you to Dennis, who adds
PS Watch the 47 minute 'Money as Debt' animated documentary This is a
useful, though by no means definitive, introduction to the topic of
debt and the monetary system. Let me know what you think.
Yours truly, quite on his own, would like to recommend in addition to
the above a brief history of money and banking in the United States
that is clear, enlightening, useful and worthwhile at least for this