Chapter
XIII (From: "Money Creators", by Gertrude Coogan, 1935
Power
to Create Money is Power to Tax
Why
Money Creation is Rightly the Prerogative of the State
Some
will say that it is silly to imagine that money can be created and
placed in the blood stream of business by the authorization of the
people’s representatives. If this be true, is it not equally silly
that we accept the fact that money is now created by private
individuals? Is that not true ? Has it not been done in this country
ever since the first violation of the Constitution took place — the
first delegation of power by Congress to private individuals to coin
money and regulate its value ?
Don’t
be afraid to think! Our fears with respect to so-called financial
"mysteries" have been created and nurtured by the Money
Creators. Wide-spread public enlightenment on the subject of what
money really is, and how it has been used anti-socially by a small
group of world-ambitious internationalists is the
one thing they fear and fight with all their power.
The
entire proposition is reducible to this: Should the Congress be
compelled to exercise the power given it by the Constitution to issue
our money on a scientific basis, i.e., in accordance with the volume
needed
for the Nation’s welfare; or should the privilege be left, as now,
in private hands to be manipulated for their own selfish purposes and
to the Nation’s "ill-fare"?
Why
should a few private individuals form a corporation, call it a Bank,
and thereafter manufacture our money ? That right certainly resides
primarily in the people, who granted it to Congress. Congress, in
violation of the Constitution, passed it on to a privileged
few.
One
cannot give up what one does not possess. If that right existed
primarily in the people, it resided secondarily in their Government,
and only through unconstitutional delegation by Congress of that
power, in the hands of a favored few. Congress cannot relinquish that
power, given it by the people, through the Constitution, any more
than it can give up what it does not possess.
Certainly,
the right of the Government to issue money is superior to any right
of the few, and the Government must withdraw from the few whatever
money-manufacturing powers it has previously granted.
It
is a duty we owe ourselves, our dependents and our children, to
demand of our Congress that it recall the privilege from private
hands and exercise its constitutional mandate.
Here
the average sincere person strikes a snag which, however, has been
placed in his path by the paid "economists" of the private
money powers and their representatives. This is—the question of how
the Government may issue money, which is value in the form of
purchasing power or medium of exchange, and actually place it in the
business stream without
giving it away.
But
what is Government ? It is the expression of the common will of the
people, and it is vested with the common welfare, subject to human
rights. The Government must pay its expenses. That is, any Government
set up by a people must levy on its citizens for its subsistence and
continued existence. This right is known as the taxing power, without
which no Government can exist and perform the functions laid upon it
by the people who created it and vested it with power, with the
expectation that it would do what they intended.
Remember
what money is. It is a demand claim on wealth. Unless you are a
banker, you can get money only by producing or rendering some service
to society. The money you receive is a piece of paper, inherently
worthless to you, until you can exchange it with some one else for
goods or services you want.
The
abandonment of barter, and the existence of a medium of exchange,
necessitates some group getting something for nothing, because
whoever issues money creates claims on real wealth. Justice demands
that the National Government be the issuer of money, for then the
purchasing power created at the original source benefits all.
Money
created and paid into use is interest-free at its source. Contrast
money that is interest-free and paid into use by the Government, with
money that is created and loaned into use by private individuals.
Money loaned into use bears interest at its source, and it may be
recalled and cancelled out of use, thereby cutting down the medium of
exchange and causing stagnation and foreclosures. Private individuals
today exercise the taxing power—they alternately dilute and
increase the purchasing power of the money in use.
The
Government can regulate new money issues to the annual increase in
production without dilution of purchasing power.
That
can be very readily judged by movements in prices. Prices can be
raised to whatever level is necessary to produce a sufficient
national income commensurate with the legitimate debt structure in
the nation. Equitable price levels require that goods be exchanged at
approximately the same levels which prevailed when the major part of
the private debt structure of the nation was created. Production can
be stepped up to whatever levels are necessary to absorb the labors
of all people who want to work. Under an honest money system, for
which the Constitution of the United States provides, there would be
no such thing as mystifying business depressions.
If,
in setting up a system of "civilized money," a government
issues lawful money in the first instance to pay its expenses, that
is eminently legitimate. Certainly it is more legitimate than to
allow private interests called Banks (all of which, unfortunately,
are today controlled by foreign manipulators because they are
controlled by the Central Banks) to issue loans (create "money"),
and collect interest upon their issues, which is allowing them to
take something
for nothing.
Today banks have the power to create purchasing power. Besides
creating purchasing power, they can collect interest thereon, and
foreclose on real wealth, if a given number of dollars are not
returned to the bank on a given date. Whether or not the dollars
returned have a greater purchasing power than the dollars borrowed is
not considered, under the present monetary "un-ethics" now
in practice. Today private individuals give up valuable goods for
privately created money. Thus, the ancient fraud becomes more and
more apparent, as repayment becomes more and more impossible.
Another
fear fostered by the money creators (in their efforts to strangle
money) is the fear very commonly held that once the Government starts
to issue money there will be no end to it. But let us reflect upon
this libel of the people’s own chosen representatives. Let us
always remember that the function of Government, and the duty of
controlling the money system, must always rest in human beings. Which
type of human beings shall we choose — the money creators who now
have the power to manipulate the money system, or some honestly
elected representatives of the people ? Statesmen
would fill our Congressional Halls if the money system were honest.
The
stakes are worth billions of dollars per year to the private
individuals who now possess money creation powers. The reason we have
many politicians instead of all statesmen, and courts of injustice
instead of courts of justice, is because the money factor enters.
Were the money system honest, bribery could be practically
eliminated. Statesmen could then be elected to the highest offices in
the Nation, the States, and the Cities. How omnipotent has been the
power over this Nation by the private money creators and their wards,
who have fattened on the interest collected on the loans of money
they created out of nothing
but a people’s ignorance and gullibility.
In
1844 Lord Beaconsfield (Benjamin D’Israeli) cited Lionel Rothschild
as saying : “Can anything be more absurd than that a nation should
apply to an individual to maintain its credit and, with its credit,
its existence as a state, and its comfort as a people?”
Today
the United States Government is paying private individuals over one
billion dollars per year
in interest to do exactly what those same private individuals are
telling the people the Nation itself cannot do. Meekly, the citizens
also pay an invisible tax levied by the money creators on the medium
of exchange, which they create with pen and ink. Yet those privately
owned banks have received their power through a delegation of that
power by Congress. Congress received that power from the people. Of
course, the delegation of that power is a flagrant violation of the
Constitution of the United States.
Would
the people rather entrust the power to create and destroy money,
without warning and to the serious damage of the nation, to a few
private individuals, or to Monetary Trustees placed in power by
statesmen, who really represented the people ? The Monetary
Trusteeship would issue it for value
received. Banks create it for nothing—out of nothing.
Readers
! Do not think that because you own a few bonds or an insurance
policy that you would not be benefited by the inauguration of an
honest money system. Do not heed the cries of the "Invisible
Government" — the financial exploiters who live by your wage
slavery and meager incomes — that your accumulated "capital"
(money) which is now invested in bonds or insurance companies, would
be lessened in value if an honest money system came into being. If
the affairs of this nation are allowed to continue as they now are,
your bonds and life insurance will become worthless because of the
deliberate manipulations of these international financiers. But if an
honest money system were brought into existence, the values of all of
your properties, including your homes and farms, would be restored,
as well as your opportunity to obtain an adequate and decent income.
Debts under the present system of control of money by the few, are
but chattel slavery; debts you contracted honestly are now calling
for dollars of greater purchasing power.
When
ancient Greece found itself in a predicament like that of the United
States today, it urged a Dictatorship on Solon—quite different from
thrusting a Dictatorship on the people without any desire on their
part for one. Solon’s first act was to take over the silver mines
and abrogate the privilege of money issue held by the Nobility, which
they had abused, just as our money masters have done in our country
and, despite humanity’s deplorable condition, are still doing.
With
the resumption of coinage by the Government of Greece began the era
which made Greece great. We confront a similar situation and it
devolves upon us whether it shall burst into a cataclysm or whether,
by the guiding light of the Spirit and the good sense to return to
the original provisions of our Constitution, we shall be able to
convert obstacles into opportunities, and once
and for all
establish an honest money system and the regeneration of our national
life.
When
the single Gold Standard, as now executed, was conceived by the
forebears of the world’s present privileged interests, Adam Smith
was engaged to write The
Wealth of Nations.
His work has come down since the time of the French Revolution as the
"Bible" of so-called classical Economics. Sadly, economics
did not begin as a science at all. Adam Smith and his followers made
human beings mere hirelings to the owners and controllers of gold and
government debts. Later John Stuart Mill was engaged to write on the
principles of currency. He, too, has been accepted through the years
as an unquestioned authority on what has been known as classical,
orthodox Economics. John Stuart Mill and his writings have been
traced directly to the designs of a small group of people who were
then planning, and are still planning, to enslave the rest of
humanity. That group is still active behind the scenes directing the
social discord necessary to accomplish its goal.
Single
Tax advocates, now recognized as a part of the Fabian Movement,
should analyze the following pertinent observations of Arthur Kitson
:
“Single
taxers and land reformers, who see in the monopoly of land the cause
of all social misery, should sit down quietly and make a simple
comparison of the total amount of annual wealth production paid in
rent of land with that extorted in the shape of interest on loans and
capital. For, the monopoly of credit not only determines the rate of
interest on all capital, but it is the chief cause of such interest.”
To
permit all sincere workers to earn a decent livelihood, only one
conquest should have been necessary — the forces of nature. That
conquest has been so complete that men and women could all taste the
fruits of economic security and leisure to devote themselves to
life’s higher aims; rather than be enslaved to a constant grind to
earn sufficient to sustain life. They cannot reach spiritual heights
because they are enchained by a constant grind and bitter struggle to
earn sustenance for the body. Having conquered natural forces, our
next object of attack is the diabolical forces, which stifle our life
in all of its phases and ramifications — now it is forward march or
sit down and die.
Those
who cling to the writings of Adam Smith, John Stuart Mill, and other
so-called classical "economists" have failed to understand
and realize that as man conquered the forces of nature, he should
have been liberated from slavery. As nature became the slave, man
should have become free — free from the everlasting terrors of
economic pressure. Science has made production of food, clothing and
shelter possible in volume never imagined by the industrialists of a
few years ago. Today humanity cannot enjoy the real fruits of
scientific progress made possible by industrialists, because of
man-made restrictions imposed by deception and continued by keeping
the public’s eyes filled with the dust of confusing propaganda. The
money powers are clinging to the hope of enslaving the world. Such
hopes should be destroyed forever. They are inhuman and un-American.
In
the multitude of "economic" and "financial"
counsellors, there is Babel. The reason for this is that "economics"
as taught, and banking as practiced, have all the attributes of magic
closely related to the tricks of the well-known Houdini.
Americans
! Is it not worth all effort you can put forth to see that every
American is informed as to what an honest money system will really do
for him, and to see that no American citizen is satisfied until that
honest monetary system is established ? Its operation would be
simple. If we do, America will have permanent prosperity beyond
anything ever experienced. Corruption and "legal" rackets
would practically disappear. They
exist because we have a dishonest money system.
An
example of how all-important the money system of a nation is, was
witnessed from April to July 1933 when, by raising the price of gold,
the President, despite the lies shouted ever since by the money
powers and their unwitting parrots, caused raw material prices to
rise and come into a more equitable relationship with the price of
finished goods. If that small step in the right direction was of such
tremendous influence, imagine the all-importance of making the entire
money system honest.
The
invisible forces behind the Government of the United States could be
disposed of by the people demanding
and obtaining
an honest monetary system, as provided for in the Constitution of the
United States. Numerous eminent men in all countries have stated
unqualifiedly that “whoever controls the money system of a nation
governs the nation.” Could there be any doubt as to who controls
the money system of the United States ? Not only the Federal Reserve
Central Banks, but the United States Treasury, and all but a few
banks throughout the country, are subject to manipulation and control
of policies by those who are subservient to the private money
creators.
The
selling to the R.F.C. of Preferred Stock (under force) in most of the
banks, has practically placed every business man in the United States
under control of the internationalists. The control of individual
banks by the National Government ii very dangerous.
The
only hope for the United States is to eliminate bank-created money
forever; replace every "credit" dollar with a real legal
tender dollar; keep banking separate from government, and restore
control of our money creation to Congress. The present un-American
control of the United States Money System could be overthrown without
war; without disturbing the public peace; without public expense;
without interfering with the constitutional rights of any single
American; without violating but by observing moral and constitutional
law; and without upsetting in any manner or taking any value away
from an owner of property in any form, whether it be physical,
tangible property or stocks and bonds.
However,
the establishing process must be dual; real money must be increased,
while
private bank created money is intelligently and progressively
decreased;
for today each paper currency dollar "reserved" in a bank
allows ten to fifteen bank credit dollars to be manufactured and
loaned out. The reform should be openly accomplished with monthly
statements in plain English, published by the Monetary Trusteeship,
so that the price level can be intelligently, openly and properly
adjusted. There
is no need for secrecy:
the need is for "pitiless publicity."
Humanity
will never be free to enjoy the fruits of our vast natural resources;
our scientific discoveries, and the willingness of millions to work
peacefully, while
private banks have two functions: that of creating and destroying
money, as well as being custodians and lenders of money. Banks must
continue to be privately owned, but they should be custodians of real
money which they could lend to worthy borrowers, and only
the nation should have the right and power to create money.
If the power to create money were honestly managed by Monetary
Trustees appointed by the representatives of the people, civilization
could then actually strive for its Divinely ordained objective —
universal peace and brotherhood under the Golden Rule (not of gold)
and material plenty, equitably distributed among all who desire to
work with brain and hand. An honest money system would free men from
slavery and enable them to march toward the better things of life.
The
Public must be protected from those who professionally condone and
raise a smoke screen around immoral practices of cheating and
destroying the medium through which all men’s labors must be
exchanged. The public does not have to tolerate merchants deciding in
advance whether a yard shall be 36 inches or 24 inches or, perhaps,
47 inches, according as they are sellers or buyers. Does not ethics
enter into the question as to whether a dollar shall be worth 100
cents or 300 cents in actual exchangeability for physical goods ?
Would-be inventors and dispensers of fraudulent weighing machines
would, like immoral teachers and doctors, be placed under the
jurisdiction of prison officials until they thought differently of
such activities. The time has certainly arrived for Americans to come
to an understanding with those who either innocently or maliciously
carry on a "science" of swindling. Many economists are
self-deceived, but they can be held responsible for continuing in
that state after they have been given proper information.
Americans
must direct their attention to the heart of the perversion —
private money creation and cancellation powers. There is no need to
oppose the rich as such. Indeed, real wealth can be accumulated by
the many;
and an adequate livelihood earned by all.
America
must revert to the money provisions of our Constitution, now in
abeyance; restore the prerogative of money creation powers to
Congress, and enact laws which treat the issuance or destruction of
money by private individuals, as high treason. Our present system has
evolved sub-rosa, in violation of the Constitution. Exchangeable
wealth itself, and not the question and ownership of debts, must be
the factor that determines our volume of money.
Nature
being enslaved, men may be free. America has opened the road to the
greatest and freest development of the individual. The world money
powers, through their weapons—Socialism, Fascism and Communism —
are struggling to force it closed. True leaders must lead us away
from the terrible economic perversion. Practical Christian leaders
cannot justify themselves or their offices unless they are willing to
attack the heart of this great moral problem. Beware of those
spiritual leaders who "plead" for Social and Economic
Justice while they refuse to attack the money problem. A practical
millennium is at hand if only leaders will accept their
responsibilities and arouse themselves to demand moral and economic
justice for a people who have, deeply rooted in their own lives, the
proper relation of the individual to his fellows, as man to man, and
as between men and women.
The
normal channels of education are closed to the dissemination of this
truth. Why
?
Because those who possess the power to pervert our economic system
also control, directly or by financial pressure — by advertising
volume or suggestion—many newspapers, magazines, and publishing
companies. The responsibility of dissemination rests on the
conscience and the shoulders of every sincere American who himself
becomes informed. Individual initiative is powerful. Have we
sufficient patriotism and love for our families to exercise all
possible influence to win the greatest fight Americans ever waged —
the
restoration and preservation of our republic ?
“Life
should be a series of festivals, interspersed by honorable labor;
instead it is a series of needless battles.”—H.V.
By
setting the world a good example in the inauguration of a sound money
system, the peoples of the world will become so activated in
constructive work as to abhor the interruptions of war. Many a war
has been precipitated in order to divert people’s minds from the
money question. By taking the power of issue and the unearned
interest out of the money masters’ hands, the prime incentive to
war is eliminated; we can finally have peace on Earth, and the good
will that springs from cooperation toward a common purpose: the
ennoblement of the races.
The
old slogan: “Die for Your Country,” will then become reversed to
“Live
for Your Country.”
“Though
lying for hire is now the primrose path to promotion,” there are
enough courageous Americans to demonstrate to the world that “honesty
is the best policy” !!
“Let
us lift back our monetary system on to the narrow gauge of honesty as
the first step to a leap forward on the broad gauge of human
progress.
“The
monetary system now serves only the convenience of a parasitic and
upstart plutocracy practising a worldly wisdom the exact opposite of
that which is the foundation of the age. It prefers the dark in times
when all men seek the light, and is sowing the seeds of hatred and
war in a world weary to death of strife. It is poisoning the wells of
Western civilization, and science must turn from the conquest of
Nature to deal with a more sinister antagonist, or lose all it has
won.” — The
Role of Money,
by Frederick Soddy.
Now
that we know this sinister antagonist—the private money powers—we
must fight it with dauntless courage.
And
do not for one moment think that your Congressman or Senator will not
listen to you, an individual voter with the initiative to demand an
interview, or that he will remain unmoved by what is demanded by you
and your friends. After all, you knew him “away back when,” and
his election to the councils of the Nation has not made him a
superman.
Once
the international money power is destroyed and the power to coin
money and regulate its value is resumed by Congress, as mandated by
our Constitution, all of the social experimentation and legislation
of the present era; with its high priesthood of theorists,
professors, "reformed" speculator stock exchange
regulators, Wall Street farmers, professional social "reformers,"
Judas leaders, Red sympathizers, Constitution ridiculers, college
boys, riot agitators, strike agitators, and destructionists in
general, can be forgotten as one bad dream.
The
abuses that have been sneaked into the Governmental structure of this
nation, and of many States and Cities, through the machinations of
the international money power to accomplish its own destructive
purposes, would be quickly thrown out as relics of a barbarous and
almost fatal assault upon the world’s only haven of a Government
truly “of, by and for the people.”
There
will never be a Utopia on earth; but conversely it is a moral
certainty that the Creator never intended that the earth should be
made a premature Hell.
