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Resolving the Wall Street Crisis: Monetary Reform

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Einstein wisely observed that you cannot solve a problem with the same consciousness that created the problem in the first place. This Wall Street “financial crisis” is an opportunity to correct systemic disease at its source. Being stampeded by the consciousness of the same individuals that orchestrated massive financial fraud will only exacerbate the crisis.  We need to shift our attention from mushroom cloud narratives and focus on the solution: creating a stable financial structure that is grounded in public ownership of the monetary system. The constitutional authority to create money and issue credit rightfully belongs to the government ~ not to a private cartel of self-serving international financiers. 

We can all agree that radical deregulation of the financial industry strategically removed the legal obstacles to premeditated wholesale fraud. Replacing the firewalls between public assets and gambling casinos is an obvious necessity. And we can all agree that speculators do not produce anything of value that contributes to a productive economy (goods or services). Their reckless gambling has collapsed a stunning array of legitimate businesses, embezzled the savings and investments of hard-working citizens, destroyed the real estate values of every homeowner in America, doubled the price of essential commodities and flooded the financial industry with trillions of dollars in worthless derivatives, a global Ponzi scheme. Strict regulation of Wall Street casinos is mandatory.   

Clearly, the ringleaders of this financial assault on our nation must not be allowed to dictate the terms of our recovery. The Secretary of the Treasury and the private banking consortium known as the “Federal” Reserve have historically served the interests of international financiers and corporate hustlers, not the citizens of the United States, as Alan Greenspan, Ben Bernanke and Goldman Sachs CEOs Henry Paulson and Robert Rubin so aptly demonstrate. Treasury Secretary Henry Paulson's extortion package unashamedly compounds systemic financial fraud with alarming ransom demands that would permanently cripple American taxpayers and transfer unprecedented powers to the Treasury Secretary for exclusive control over the economic and financial life of the US forever.

 * The Treasury Secretary is authorized to purchase up to $700 billion in mortgage-related assets at any one time. In other words, $700 billion is only the beginning of what this cartel of thieves will embezzle.
* Private financial institutions are "designated as financial agents of the Government.”
* “Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency." 
 

Paulson is a member of the International Monetary Fund Board of Governors, the nexus of predators that bankrupted Argentina in the blink of an eye. Like every nation cannibalized by the IMF since World War II, Argentina was strategically gutted by crippling debt, radical pro-corporate deregulation and privatization schemes. Federal Reserve Chairman Alan Greenspan and Milton Friedman’s free market buccaneers applauded the carnage as the lifeblood of one nation after another was sucked dry by roving vampire capitalists. This Shock Doctrine "financial crisis" is a prelude to classic (central bank) IMF asset-stripping. 

Predatory lenders that jacked up the interest rates on victims of mortgage fraud could have readjusted their loan terms at reasonable fixed rates rather than foreclosing and destroying home values in every state in the country, thereby wiping out the only real asset of the middle class. These institutions have not earned taxpayer bailouts. Nor should taxpayers be expected to assume the losses of private financial institutions that engaged in deliberate and reckless gambling ~ $700 billion for Goldman Sachs with no ceiling on future demands, $85 billion for AIG, the bogus "securitized" debts of Fannie May and Freddie Mac and trillions of dollars in worthless derivatives contrived by financial hustlers. Reimbursing gamblers for their losses will not produce the systemic correction that is needed. Stabilizing our financial system requires abolishing the privately-owned Federal Reserve System, firing (or indicting) the Secretary of the Treasury, strictly regulating financial markets and restoring direct government control of our monetary system, as our Constitution mandates. The Federal government was constitutionally authorized in 1787 to create its own legal tender and issue credit.  

Money is a legal fiction which derives its value from social consensus. Legal tender does not require commodity backing, such as gold or silver, but only social agreement that it can be used as a medium of exchange. Publicly-owned credit issuing mechanisms can function as a non-profit public service or the interest on loans can be used to finance government in lieu of taxes. Publicly-owned mechanisms would keep money circulating as a convenience that facilitates the exchange of goods and services and would reward productivity by making investment capital available to legitimate businesses that serve society. 

 

Attorney Ellen Brown, historian Stephen Zarlenga and economist Michael Hudson have documented historical precedents for US government-owned monetary systems with blueprints for implementing the mechanisms. Publicly-owned monetary systems were very successful in colonial times, flourished again under Andrew Jackson and Abraham Lincoln, and would have been restored by John F. Kennedy with Executive Order 11,110, had he not (also) been assassinated.  

 

In the short term, a government lending institution could be established immediately to refinance the loans of defaulting homeowners at reasonable fixed rates, allowing families to keep their homes and stabilizing the real estate market. Long term, government-issued credit and sound money could be extended to legitimate businesses and qualified borrowers to stimulate a productive economy, rebuild our public infrastructure, end our dependency on fossil fuels, develop renewable energy resources, create a clean energy economy, retool our auto industry for electric cars and plug-in hybrids, create efficient public transportation, revive our manufacturing base, decontaminate our waterways and soils, and empower farmers and organic growers to nourish our local communities. We cannot accomplish any of this if we remain enslaved by the masters of fraud that have ravaged our country. 

 

The Federal Reserve System is not federal and has no reserves. It is a privately-owned bank consortium that deliberately engineers bubbles and depressions by arbitrarily expanding and contracting its credit. It has devastated the public's purchasing power by steadily inflating its worthless fiat “notes.” The cycles of economic chaos and despair will continue until this private debt monopoly is banished. 

 

In his 1899 book, The History of Money in America, the great monetary historian Alexander Del Mar, described the catastrophic error made by our “Founding Fathers.” While the Constitution assigns the function of money creation to the federal government, it does not explicitly describe the mechanism for issuing currency and credit, leaving that function open to predators:  

 

"Never was a great historical event [The American Revolution] followed by a more feeble sequel. A nation arises to claim for itself liberty and sovereignty. It gains both of these ends by an immense sacrifice of blood and treasure. Then when victory is gained and secured, it hands the national credit - that is to say a national treasure over to private individuals, to do as they please with it! ... Americans of the revolution had before them ... the historical examples of Greece and Rome. In all these states the main contention from first to last between the aristocratic and popular factions arose out of and centered in the monetary system; that greatest of all dispensers of equity or inequity. They had only to take care that the seed they planted was genuine and uncontaminated. Nature was certain to do the rest. Well they planted; and now look at the fruit and see what it is that they planted! They planted financial corporations ... they planted private money ... they planted financial exemptions from public burdens...In a word they planted another revolution." 

 

Had Congress corrected this fatal omission by legislating the mechanism for creating currency and issuing credit, our monetary system would not have been hijacked at the turn of the 20th century. In 1933, Congressman Louis McFadden, Chairman of the House Banking and Currency Committee, described the cabal of world bankers who enslaved America in 1913. He stated on the Congressional record: 

 

"Some people think that the Federal Reserve Banks are United States Government institutions. They are private monopolies which prey upon the people of these United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory money lenders. In that dark crew of financial pirates there are those who would cut a man's throat to get a dollar out of his pocket; there are those who send money into states to buy votes to control our legislatures; there are those who maintain international propaganda for the purpose of deceiving us into granting of new concessions which will permit them to cover up their past misdeeds and set again in motion their gigantic train of crime.

 

"These twelve private credit monopolies were deceitfully and disloyally foisted upon this Country by the bankers who came here from Europe and repaid us our hospitality by undermining our American institutions. Those bankers took money out of this Country to finance Japan in a war against Russia. They created a reign of terror in Russia with our money in order to help that war along. They instigated the separate peace between Germany and Russia, and thus drove a wedge between the allies in World War. They financed Trotsky's passage from New York to Russia so that he might assist in the destruction of the Russian Empire. They fomented and instigated the Russian Revolution, and placed a large fund of American dollars at Trotsky's disposal in one of their branch banks in Sweden so that through him Russian homes might be thoroughly broken up and Russian children flung far and wide from their natural protectors.

 

“Mr. Chairman, when the Federal Reserve Act was passed, the people of these United States did not perceive that a world system was being set up here which would make the savings of the American school teacher available to a narcotic-drug vendor in Acapulco. They did not perceive that these United States were to be lowered to the position of a coolie country which has nothing but raw material and heart, that Russia was destined to supply the man power and that this country was to supply the financial power to an "international superstate" ~ a superstate controlled by international bankers and international industrialists acting together to enslave the world for their own pleasure.”

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http://nikkialexander.wordpress.com Nikki Alexander is a full-time writer and activist encouraging deep systemic reform in the United States to bring about social, political and economic justice for ALL members of our society. We are in this (more...)
 

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This is absolutely, precisely, indisputably accura... by martinweiss on Tuesday, Sep 30, 2008 at 3:52:49 PM
your thinking is so good, clear, comprehensive, po... by martinweiss on Tuesday, Sep 30, 2008 at 11:56:49 PM