The ten major shareholders of the Federal Reserve are as follows.
Rothschild: London and Berlin; Lazard Bros: Paris; Israel Seiff: Italy; Kuhn- Loeb Company: Germany; Warburg: Hamburg and Amsterdam; Lehman Bros; New York; Goldman and Sachs: New York; Rockefeller: New York.
und das letzte! dann geh ich wirklich ins bett
Money in a Free Nation
by Joanna Parker
Unless you become as a little child,
you shall in nowise enter the kingdom of heaven .
Mt. 18:3
An itinerant preacher once said that heaven and hell are the same place. "Hell is just heaven misunderstood," he added, "and neither is anywhere but here, nor for any time but now."1
All that most of us know of life is our sensory experience of it, our emotional reactions to it, our mental speculations about it, and occasionally a revelation that seems to transcend all of these. One piece of knowledge that even our ‘hard’ sciences perceive to be incontrovertible is the fact that the universe operates on a principle of equilibrium. It is a rule that children recognize easily because their judgment has not yet been skewed by the frauds that abound in adult society.
Fraud and freedom, unlike heaven and hell, cannot live in the same space. A free nation, therefore, must have honest money.
"You can’t print gold."
- Ron Paul2
My grandson Daniel trades Pokéman cards with his friend Russell. Each transaction is in balance, just as on a scale. "I’ll trade you this one for that one." Each youngster gets full value for what he surrenders to the other. But if one day Russell were to offer Daniel a piece of paper with "Dewgong card" written on it in exchange for Daniel’s Charizard card, Daniel would probably tell his friend - and quite properly - to get real.
The key word is real. In a free nation, as it is with children, exchanges must be real. And words used to signify the nature and substance of exchanges must mean what they say; otherwise they are not real words. In a free nation, words having to do with mundane matters must mean what they say, and any word that cannot be defined by unanimous agreement among or between the parties involved is not a real word. A word to which an unequivocal meaning has not been assigned is not a word. It signifies nothing. It is just a string of letters.
Long-time hard-money advocate Paul Hein3 tested a bogus word couple of years ago with the U.S. Treasury Department. He wrote requesting that someone at Treasury give him the definition of a dollar according to U.S. Law, and added that he wanted the exact citation.
"Customer Assistance" at the Treasury Department replied that a dollar is defined as "a currency bill and monetary unit of the United States, equal to 100 cents" but that they had no information on a specific citation in the federal regulations. They suggested that he contact the Federal Reserve.
Hein wrote back, with more questions, and received an even emptier non-answer than before and a firm request, this time around, that he contact the Federal Reserve.
Hein wrote a third time, posing a new set of questions and expressing his amazement that the Treasury Department could not give him the definition of a dollar in U.S. Law. This time the Treasury’s Customer Assistant informed him that the Department does not "have regulatory authority over actual currency" and that its office would "not respond to any other inquiries regarding the definition of a dollar."
Long before initiating this fruitless correspondence with the Treasury, Hein had already engaged in the same experiment with the Federal Reserve. And with the IRS before that. The Fed replied that due to the "technical nature" of Hein’s questions, the official he had contacted was "unable to answer at this time." The IRS was even more candid: "The term ‘dollar’ is not defined in the Internal Revenue Code."
So, in the nation vaunted as the world’s freest and richest, nobody in ‘authority’ knows what a dollar is. Thus we can reasonably deduce that no one in the rest of the world knows, either. Nor what their own units of exchange are. The British don’t know what a pound is, the French don’t know what a franc is, the Germans don’t know what a mark is, the Japanese don’t know what a yen is, and so on. Since all these supposed currencies are fiat (forced tender without intrinsic value), they cannot be defined because they aren’t anything. The very existence of Legal Tender Laws is prima facie evidence of a currency’s worthlessness. If it were any good, as economist Larry Parks points out, people would not have to be forced to use it.4
"Paper money has had the effect in your state that it will ever have, to ruin commerce, oppress the honest, and open the door to every species of fraud and injustice."
-- George Washington5
What will people living in a free nation use for money? The question begs an immediate second question: where? If that free nation is geographical, rather than virtual, exchanges among its inhabitants will necessarily have to be as real and as physical as the terrain on which they live. And the media of such exchanges cannot be given a forced definition as "legal tender" but must be left to all parties in all exchanges to decide, by mutual consent, what the medium or media are to be. Otherwise, there is no way that the inhabitants of such a nation will remain free.
So, within the borders of a free nation, no central authority needs to decide what constitutes ‘money’. However, the inhabitants of this territory, just as those in any other, are going to need all manner of goods to sustain their lives in all sorts of ways. Let us suppose, from here on out, that these inhabitants are us. And let us suppose that we have put enough fiat money together to lease a relatively virgin territory from an East African nation. We will have to start from scratch. We will need to import almost everything, from foodstuffs to plumbing fixtures. So, the first kinds of exchanges in which we will have to engage will not be among ourselves but will have to be across borders - international. And once we are fully established and thriving, we will still have to do a great deal of importing (and, hopefully, exporting) because the world’s resources are international. We will need a medium of exchange that works everywhere, not just at home.
Inside our borders, we may reach the consensus that coinage in fixed weights of silver and gold will serve as our internal money for most exchanges, but clearly we cannot be sending such bulk around the world for what we want to buy nor demanding it from foreigners to whom we wish to sell. But if we have understood that fiat money is immoral6 and have banished it from our lives, how are we going to engage in world trade without it?
Easy. Establish accounts with real-money depositories such as The Gold & Silver Reserve, Inc. Or, if we have among us someone with an expertise equal to that of the creators of G&SR, we can create our own depository. But I suggest that we begin with a depository that has already tested its method and worked out the kinks.
G&SR is more familiarly known as "e-gold"7. It is the ultimate bank, but only because it is not a bank - not by any contemporary standard, nor even by any standard since the Middle Ages. Gold & Silver Reserve is a depository of real money, wealth that is neither lent nor borrowed but simply kept, ready at any time to obey the will of the owners of this wealth, and of whoever cares to become an owner. It has turned the tables on the modern alchemists, the wizards of deception who believe they have succeeded in turning gold into paper. G&SR will take your paper and turn it back into gold8.
"Paper money eventually returns to its intrinsic value - zero."
- Voltaire9
Let us suppose that several hundred (thousand?) pioneering FNF members, sponsors, and affiliates have managed to lease a relatively undeveloped territory from the Tribal Confederation of Dewgong, a third-world country. A Hong-Kong-like autonomy for the lessors is bound into the contract - and perhaps also, ideally, an option to purchase. Once the deal is done, those of us who are ready to leave our various homelands will have no problem doing so if our fiat money has already been electronically transmuted into gold by means of a G&SR account. This is because, once our dollars, bahts, pesos, and pounds reach the account, they no longer exist. What we will own instead are physical weight-units of precious metals at their going market value, upon which we can draw in tangible specie or turn back into fiat money - for bill-paying, gifts, whatever - any time we wish and anywhere we wish, with a single keystroke or mouse click.
Thus a person can quit any country whose government imposes controls on a citizen’s ability to do so and take all his money with him; and he can do it with a smile (read: smirk)10. The new citizen of Free Dewgong Territory will leave his former land with little more than a few traveller’s checks and pocket change. He will pass by his government’s duoanier (Customs agent) with ‘nothing to declare’. Nor will he have any foreign bank accounts to confess-to on future tax forms. As far as respective national authorities are concerned, everyone emigrating to Free Dewgong11 Territory is virtually broke.
"All the perplexities, confusion and distresses in America arise not from defects in the constitution or confederation, nor from want of honor or virtue, as much as from downright ignorance of the nature of coin, credit, and circulation."
- John Adams, letter to Thomas Jefferson12
Actually, every one of us really is broke; but because we are forced to play the fiat-money game, and in view of the murkiness in our crystal balls regarding future economic and political outcomes, we usually try to keep at least a savings account going. However, even some libertarians don’t realize that these very accounts are contributing to - indeed, aiding and abetting - everything we hate about what has been happening to our lives because of the relentless growth of government. For every dollar "deposited" (lent) to the bank, the bank is allowed to lend out nine more. These new dollars surface magically with a keystroke, a numeric virgin birth; and with these pseudo dollars, created from nothing and backed by nothing, the bank then makes the loans from which it "earns" more dollars - which are also created out of nothing.13
The Federal Reserve engages in the same fraud on a larger scale when it "buys" government securities. This is the way tons of new paper chits marked "Federal Reserve Notes" (IOUs) are cranked out and circulated as "legal tender". It is also how the 50 vassal states of America get their pork barrels filled perennially, and to relentlessly-higher levels. Above all, it is the way our so-called "national debt" has reached its dizzying altitude of $5.5 trillion.
There is no such debt, of course, since everything has been paid-for with nothing to begin with. But in order to fool the citizenry into believing it is all very serious and real, government pretends that their earnings (and their boats, booze, cigars, cigarettes, gasoline, phone calls, capital gains, and so on ad infinitum) must be taxed.14
Thus fiat money is the ultimate instrument of control, an unwritten quid pro quo between bankers and rulers. The State gets to rule the mob, and the central banker gets to rule the State. These are the true Partners in Power.15 The only possible way for a free nation to break this link, or escape its long reach, is to have nothing to do with banks.
"What is e-gold? e-gold is the first electronic currency that unleashes the potential of worldwide e-commerce. From Azerbaijan to Zaire, e-gold is the largest, fastest growing, privately issued currency in the world. e-gold is World Wide Money."16
Using a deposits-and-payments facility that operates on a 100% precious-metals purchase-and-sell basis is the only honest and freedom-protecting way to carry on day-to-day financial transactions in a free nation. Since precious-metals accounts continuously reflect ongoing market value, the true cost of every commercial activity is always transparent. Inflation is now impossible, and prices are now valid measures.
The psychological reward of this reality-based economy is automatic. If I buy a book at Phil’s bookstore, I will no longer have to cheat him with fiat paper or junk-metal coins. I can pay him what the book is really worth. I can pay him with real money. It won’t even matter if he has priced the book in dollar terms. I can go to the computer terminal he has set-up in his store, call up my e-metal account, and instantly transfer to his e-metal account the exact dollar-equivalent of whichever metal I want to spend.
Lending and borrowing will also be possible, in the form of privately-negotiated contracts between or among account holders. If Roderick decides to start a school, he can solicit financing from one or more of his fellow account holders at an X% interest rate in e-metal. Then, if I want my grandson to attend Roderick’s school but can’t afford to pay a year’s tuition in advance, he can offer me a monthly payment arrangement at a premium of Y% in e-metal. We will all be agreeing in a real-world framework that cannot help but produce harmony. It will feel good to earn and spend real money. It will feel good to be free to be honest, to be like children - innocent - exchanging our Pokéman cards. And, it will feel good to think that, just maybe, it’s really possible to turn hell back into heaven.
Afterword
The Coinage Act of 1792 fixed the value of a dollar at the same silver content (.7982 oz.) as that of the Spanish 8 reales (known as the Spanish Milled dollar or ‘Pillar’ dollar). This ‘foreign’ coin circulated freely in colonial America and the United States from the early 1700s [because the money-value was its silver content, not its national origin] until 1857. The ‘Pillar dollar’ also came in smaller denominations, which people referred to as ‘bits’ - thus the expressions "two bits, four bits, six bits" that still persist today for a quarter, half-dollar, and three quarters.
Colonial Pillar Dollar, 1758
The average market price of silver in 1792 was $1.293, and although the price fluctuated in the 19th century because of massive new discoveries of the metal, in 1965, the year that the U.S. government debased our coinage by eliminating its silver content, the market price was still $1.293. Same story for gold. Although the Coinage Act of 1792 fixed the gold/silver ratio at 15:1, but U.S. $20 gold and $1 silver coins reflected the market-price ratio of 20:1, which remained consistently stable until 1933, when the U.S. president (FDR) debased the coinage for the first time in our history. (And confiscated everybody’s gold, in the bargain.) ~ Sections 8 and 10 of Article I of the U.S. Constitution hve never been annulled by any amendment to the Constitution. Nor has the Coinage Act of 1792 has not been repealed. One of its provisions mandates the death penalty for any public official convicted of debasing the coinage. In 1833, when official records of the London Fix price of gold were first published, the year’s average price was $20.65; in 1930, it was still $20.65. In 1932, it was $20.69. By 1980, the year’s average price had reached $612.56 (with a spike at one point to well above $800). In other words, our money had been debased by an average of 97%. The dollar had become three cents. ~ No one has been hanged.17
* * *
Notes
1 Harry Priestly (1915-1996), in several oral dissertations, heard by only a few of the famous, such as actress Jane Russell and her immediate family and friends. I knew him for 35 years, ever urging him to publish his insights. He never did.
2 Attributed to unidentified issue of Readers Digest in "The Return of the Gold Standard?"
3 Dr. Hein is a contributing essayist at www.gold-eagle.com. He tells this story in his September 21, 1998 article "What a Web We Weave" (at
http://www.gold-eagle.com/gold_digest_98/hein092198.html).
4 Lawrence M. Parks, Foundation for the Advancement of Monetary Education (http://www.FAME.org), in The Fight for Honest Monetary Weights and Measures (Jersey City, NJ: Palisade Press [White Paper No. 2, January 17, 2000]), p. 5.
5 Letter to J. Bowen, Rhode Island, January 9, 1787 (quoted in Parks, op. cit., Introduction, p.ii).
6 Because it is created out of thin air and backed by nothing. It is simply legalized counterfeit. By its very nature, fiat money cannot represent any specific value. The dollar amount printed on a piece of paper labeled "Federal Reserve Note" would be worth the same, intrinsically, were the denominations printed as One, Five, Ten, Twenty, Fifty, or 100 Dewgongs.
7 www.e-gold.com/e-gold.asp?cid=100889
8 Or into silver, if you wish, or into platinum or palladium or all four metals. G&SR uses the term gold for simplicity sake, as shall I.
9 Quoted in Parks, op.cit., Intro., p.ii.
10 For the first time in its history, the United States now exerts similar controls. Thanks to the Clinton Administration (and the War on Drugs), one cannot leave the country with more than $10,000 in cash. He or she must also satisfy IRS reporting requirements, of course, so that Uncle can be sure the departing individual is not leaving to avoid taxes. (Heaven forbid!
11 Simple-minded as it may seem, I have often thought a free nation's name should be "Liberty." Admittedly, this didn't work very well for Liberia, but its newly emancipated settlers didn't have the time that we will have had to plan ahead.
12 Quoted in Parks, op.cit., Intro., p.ii.
13 Since 1971, after President Nixon put an end to the gold standard (formalized by Congress in 1978).
14 Llewellyn Rockwell, Jr., of the Mises Institute, once quipped, "The truth is the Fed doesn't need our taxes any more than a counterfeiter needs to rob the local gas station." ("Mad Fed Disease," The Free Market, May 1996: n.p. [see reprint at www.lewrockwell.com/archives/fm/5-96.html]).
15 The title of Roger Morris' 1999 book on Bill and Hillary Clinton (Regnery Publishing).
16 From the GS&R "Questions and Answers" page (link on the page given in note 7). I recommend the Site Map, also.
17 These data (average London Fix, as world standard) were taken from www.kitco.com/cgi-bin/yearly_graphs.cgi. Records for U.S. prices only are posted at www.globalfindata.com/tbsilver.htm and www.globalfindata.com/tbgold.htm.
Joanna Parker began with an economics degree from Seattle University but did her graduate work in French and linguistics at Washington State University and Tulane. She spent many years doing books (accounting) and as many more teaching English and French at every level from elementary to college. Her last full time post was at Holy Cross College in New Orleans, a small 4-year undergraduate institution where she doubled as both English professor and its one-person French department. Retired since 1989, she is now widowed and living near her sons in Ocean Shores, Washington.
