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The Issue and the Answer
The Constitution of the United States introduced a new and viable concept of freedom to the American people. One of its basic stipulations was—and still is—a money of the people, and by the people. Such money was stoutly defended by our most respected statesmen up to, and including Abraham Lincoln; but due to the powerful influence and bribery of international bankers it was never realized. The last serious effort to enforce it died with the assassination of the Great Emancipator.
Today we approach our bicentennial, only to find freedom in its death throes under the heel of an independent money system still in the hands of international bankers—the same whose oppression precipitated the Revolution—the same that circumvented the Constitution from its very beginning. Our country is presently confronted by a financial and moral debacle unprecedented in all its history. A benighted and angry middle class mistrusts and defies its government, engages nation-wide in unlawful and crippling strikes against itself—not knowing the cause of its economic plight. The issue and the answer should be obvious to economists. The Issue: Inflation. Counterfeit money is legalized for privileged interests which loan it into circulation at usury. The people must not only borrow their own money, they must—in the total picture—borrow additional money to pay the interest. The swindle is multiplied by cyclically expanding and contracting credit and interest rates, causing bankruptcies and further concentration of the Nation's real wealth. It brings about a vicious price-wage spiral which plunders the lower income brackets. It stifles both production and employment—replaces them with higher wages and higher prices for a diminished work force. In addition to inflated wages, preferred workers in industry and in the civil service are granted exotic pensions which must soon be paid in [p. 55] dollars equivalent in value to post war German marks. The Author of liberty—though still proclaimed in Congress—is banished from public education.
The Answer: Congress must assume its constitutional obligation "to coin money, regulate the value thereof, . . . emit bills of credit" of its own. The Constitution has never been amended to delegate these sacred obligations to private profit-motivated interests—to the so-called Federal Reserve which is neither federal nor reserve, but a money creating colossus empowered to create money at will out of thin air.
If the Nation's fiscal and economic chaos is to be corrected, Congress must repeal the Federal Reserve Act of 1913, and assume its constitutional responsibility for the people's medium of exchange. Otherwise the last vestige of freedom will shortly pass from us. The procedure would be relatively simple.
Upon repeal of the Federal Reserve Act, Congress must issue enough constitutional money to retire the national debt. This creative act by the people's representatives would in no sense be inflationary. It would only replace inflated money with honest money of the people. Whether the liquidated bonds were the former possession of banks, of institutions, or of private citizens, all proceeds would end up in a bank to serve as 100% reserve for loans to future clients. Congress must establish and govern a regulatory agency to see that 100% reserve for all loans is strictly observed. The penalty for counterfeiting must apply to bankers as well as to private citizens.
The money creators and their fellow-traveling beneficiaries of inflation would protest to the high heaven; but let us appraise some of the benefits to the great middle class:
1. It would eliminate our half trillion dollar national debt along with the $30 billion current interest charge attending it; it would preclude inflation from ever saddling us with another.
2. The sixteenth amendment to the Constitution could be repealed since it was only passed to permit the federal income tax necessary to pay the interest on a proliferating, national debt.
3. With no inflation there would be no legitimate excuse for [p. 56] a price-wage spiral; no more plunder of the lower, and fixed income brackets. A dollar would be safe in the citizen's pocket.
4. It would restore free enterprise and free competition— both long dead—the victims of inflation. It would permit the unemployed to supply their own needs with their own hands. Those who, through no fault of their own, are poor and distressed would be well cared for without costly government intervention which entails massive bureaucracy—presently a burgeoning industry in itself.
5. It would divert labor from questionable promotions, and from featherbedding and make-work projects, to useful production; and provide wages with purchasing power.
6. It would reduce the crime wave by removing the excuse for all the various crimes of larceny related to need. By having ample funds available for law enforcement, most serious crimes could be prevented. At long last our streets could again be safe at all times. We could indeed be free and safe at the same time without a police state.
On what grounds do the present creators and inflators of our money scream inflation and socialism whenever money of the people is mentioned? If enacted, it would become the first real challange to the threat of world subversion by godless dictatorship. We would assume world leadership by acclain—not by cold war and meaningless detente.
If legal money of the people is adopted, most of us will have to revise our life styles to be sure—a small price compared to the alternative if "counterfeit money" remains in force.
An honest medium of exchange is a first requisite if freedom is to endure. Let none dare call it socialism.
To be sure, honest money will not change human nature. Given another 200 years, or less, it too will succumb to greed and lust for power UNLESS mankind finally learns to exercise responsibility and self discipline along with prosperity—learns to "accept my yoke which is easy, and my burden which is light"
—Jesus of Nazareth. [p. 57]
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