4-26-00
Introduction
The love of money is the root of all evil
(1 Timothy 6: 10)
In 1901, the national debt of the United States was less
than $1 billion. It stayed at less than $1 billion until we
got into World War I. Then it jumped to $25 billion.
The national debt nearly doubled between World War I
and World War II, increasing from $25 billion to $49
billion. Between 1942 and 1952, the debt zoomed from
$72 billion to $265 billion. In 1962, it was $303 billion.
By 1970, the debt had increased to $383 billion.
Between 1971 and 1976, it rose from $409 billion to
$631 billion. The debt experienced its greatest growth,
however, during the 1980s, fueled by an unprecedented
peacetime military buildup. In 1996, the Outstanding
Public Debt has roared past $5 trillion. The
unconstitutional "share" of this debt for every man,
woman, and child is currently nearly $19,000 and will
continue to increase, along with individual credit card
debts, mortgages, automobile loans, and so on.
Today, as we stand before the dawn of a New World
Order run by internationalist financiers, most of the
revenue collected by the Federal Government in the form
of individual income taxes will go straight to paying the
interest on the debt alone. At the rate the debt is
increasing, eventually we will reach a point where, even
if the Government takes every penny of its citizens'
income via taxation, it will still not collect enough to keep
up with the interest payments. The Government will own
nothing, the people will own nothing, and the banks will
own everything. The New World Order will foreclose on
America.
The Three Types of Conquest
History reveals that nations can be conquered by the use
of one or more of three methods.
The most common is conquest by war. In time, though,
this method usually fails, because the captives hate the
captors and rise up and drive them out if they can. Much
force is needed to maintain control, making it expensive
for the conquering nation.
A second method is by religion, where men are
convinced that they must give their captors part of their
earnings as "obedience to God." Such a captivity is
vulnerable to philosophical exposure or by overthrow by
armed force, since religion by its nature lacks military
force to regain control, once its captives become
disillusioned.
The third method can be called economic conquest. It
takes place when nations are placed under "tribute"
without the use of visible force or coercion, so that the
victims do not realize they have been conquered.
"Tribute" is collected from them in the form of "legal"
debts and taxes, and they believe they are paying it for
their own good, for the good of others, or to protect all
from some enemy. Their captors become their
"benefactors" and "protectors."
Although this is the slowest to impose, it is quite often
long-lasting, since the captives do not see any military
force arrayed against them, their religion is left more or
less intact, they have freedom to speak and travel, and
they participate in "elections" for their rulers. Without
realizing it, they are conquered, and the instruments of
their own society are used to transfer their wealth to their
captors and make the conquest complete.
In 1900, the average American worker paid few taxes
and had little debt. Today, payments on debts and taxes
take more than half of what he earns. Is it possible that a
form of conquest has been imposed on America? Read
the following article and decide for yourself -- and may
God have mercy on this once debt-free and great
country.
Money Control in America
Americans, living in what is called the richest nation on
earth, seem always to be short of money. It is impossible
for many families to make ends meet unless both parents
are in the work force. Men and women hope for
overtime hours or take part time jobs in the evening and
on weekends. Children look for odd jobs for spending
money. Nevertheless, the family debt climbs higher.
Psychologists say that one of the biggest causes of family
quarrels and break-ups is "arguing over money." Much of
this trouble can be traced to our present "debt-money"
system.
Too few Americans realize why the Founders wrote into
Article I of the U.S. Constitution the following provision:
"Congress shall have the power to Coin Money and
Regulate the Value Thereof." They did this, as we will
show, in the hope that it would prevent the "love of
money" from destroying the Republic they had founded.
We shall see how subversion of Article I has brought on
us the evil of which God warns us in 1 Timothy 6:10.
Economists use the term "create" when speaking of the
process by which money comes into existence.
"Creation" means making something which did not exist
before. Lumber workers make boards from trees,
workers build houses from lumber, and factories
manufacture automobiles from metal, glass, and other
materials. But in all these, they did not actually "create."
They only changed existing materials into a more usable
and, therefore, more valuable form.
This is not so with our current money supply. Here, and
here alone, something is actually "created" out of nothing.
A piece of paper of little value is printed so that it is
worth a piece of lumber. With different figures it can buy
the automobile or even the house. Its value has been
created" in the truest sense of the word.
Money is very cheap to make, and whoever does the
"creating" of money in a nation can make a tremendous
profit. Builders work hard to make a profit of five
percent above their cost to build a house. Auto makers
sell their cars for one to two percent above the cost of
manufacture and it is considered good business. But
money "manufacturers" have no limit on their profits,
since a few cents will print either a $1.00 bill or a
$10,000 bill. That profit is part of our story.
The Causes of the Great Depression
An adequate supply of money is indispensable to civilized
society. We could forego many other things, but without
money industry would grind to a halt, farms would
become only self-sustaining units, surplus food would
disappear, jobs requiring the work of more than one man
or one family would remain undone, shipping and large
movement of goods would cease, hungry people would
plunder and kill to remain alive, and all government
except family or tribe would cease to function.
An overstatement, you say? Not at all. Money is the
blood of civilized society, the means of all commercial
trade except simple barter and exchange. It is the
measure and the instrument by which one product is sold
and another purchased. Remove money or even reduce
the supply below that which is necessary to carry on
current levels of trade, and the results are catastrophic.
For an example of this, we need only look at America's
depression of the early 1930s.
In 1930, America did not lack industrial capacity, fertile
farmlands, skilled and willing workers or industrious
families. It had an extensive and efficient transportation
system in railroads, road networks, and inland and ocean
waterways. Communications between regions and
localities were the best in the world, utilizing telephone,
teletype, radio, and a well-operated government mail
system. No war had ravaged the cities or the countryside,
no pestilence weakened the population, nor had famine
stalked the land. The United States of America of 1930
lacked only one thing: an adequate supply of money to
carry on trade and commerce.
In the early 1930s, bankers, the only source of new
money and credit, deliberately refused loans to industries,
stores, and farms. Payments on existing loans were
required, however, and money rapidly disappeared from
circulation. Goods were available to be purchased, jobs
waiting to be done, but the lack of money brought the
nation to a standstill. By this simple ploy, America was
put into a "depression" and bankers took possession of
hundreds of thousands of farms, homes, and business
properties. The people were told, "Times are hard," and
"Money is short." Not understanding the system, they
were cruelly robbed of their earnings, their savings, and
their property.
Power to Regulate the Value of Money
When we see the disastrous results of an artificially
created shortage of money, we can better understand
why our Founding Fathers, who understood both money
and God's laws, insisted on placing the power to "create"
money and the power to control it only in the hands of
the Federal Congress. They believed that all citizens
should share in the profits of its "creation" and therefore
the Federal Government must be the only creator of
money. They further believed that all citizens, of
whatever State, territory, or station in life, would benefit
by an adequate and stable currency. Therefore, the
Federal Government must also be, by law, the only
controller of the value of money.
Since the Federal Congress was the only legislative body
subject to all the Citizens at the ballot box, it was, in their
minds, the only safe depository of so much profit and so
much power. They wrote it out in simple, but
all-inclusive terms: "Congress shall have the power to
Coin Money and Regulate the Value Thereof."
Instead of the constitutional method of creating our
money and putting it into circulation, we now have an
entirely unconstitutional system. This has brought our
country to the brink of disaster, as we shall see.
Since our money was handled both legally and illegally
before 1913, we shall consider only the years following
1913, since from that year on, all of our money had been
created and issued by an illegal method that will
eventually destroy the United States if it is not changed.
Prior to 1913, America was a prosperous, powerful, and
growing nation, at peace with its neighbors and the envy
of the world. But in December of 1913, Congress, with
many members away for the Christmas holiday, passed
what has since been known as the Federal Reserve Act.
Omitting the burdensome details, this Act simply
authorized the establishment of a Federal Reserve
Corporation, run by a Board of Directors (the Federal
Reserve Board). The Act also divided the United States
into twelve Federal Reserve "Districts." This simple, but
terrible, law completely removed from Congress the right
to "create" money or to have any control over its
"creation," and gave that function to the Federal Reserve
Corporation. It was accompanied by the appropriate
fanfare. The propaganda claimed that this would "remove
money from politics" (they did not say, "and therefore
from the people's control") and prevent "boom and bust"
economic activity from hurting the Citizens.
The people were not told then, and most still do not
know today, that the Federal Reserve Corporation is a
private corporation controlled by bankers and therefore is
operated for the financial gain of the bankers over the
people rather than for the good of the people. The word
"Federal" was used only to deceive the people. Since that
"day of infamy," more disastrous to us than Pearl
Harbor, the small group of "privileged" people who lend
us "our" money have accrued to themselves all of the
profits of printing our money, and more! Since 1913,
they have "created" tens of billions of dollars in money
and credit, which, as their own personal property, they
can lend to our government and our people at interest
(usury). An example of the process of "creation" and its
conversion to people's "debt" will aid our understanding.
Billions In Interest Owed to Banks
We shall start with the need for money. The Federal
Government, having spent more than it has taken from
its citizens in taxes, needs, for the sake of illustration, $1
billion. Since it does not have the money, and Congress
has given away its authority to "create" it, the
Government must go to the "creators" for the $1 billion.
However, the Federal Reserve, a private corporation,
does not just give its money away! The bankers are
willing to deliver $1 billion in paper or credit to the
Federal Government in exchange for the Government's
agreement to pay it back -- with interest. So Congress
authorizes the Treasury Department to print $1 billion in
U.S. Bonds, which are then delivered to the Federal
Reserve bankers. The Federal Reserve then pays the cost
of printing the $1 billion (about $1,000) and makes the
exchange. The Government then uses the money to pay
its obligations. What are the results of this fantastic
transaction? Well, $1 billion in Government bills are paid
all right, but the Government has now indebted the
people to the bankers for $1 billion on which the people
must pay interest!
Tens of thousands of such transactions have taken place
since 1913 so that in 1996, the U.S. Government is
indebted to the bankers for more than $5 trillion. Most of
the income taxes that we pay as individuals now go
straight into the hands of the bankers, just to pay off the
interest alone, with no hope of every paying off the
principle. Our children will also be forced into servitude.
You say, "This is terrible!" Yes, it is, but this is only part
of the sordid story. Under this unholy system, those
United States Bonds have now become "assets" of the
banks in the Federal Reserve system which they then use
as "reserves" to "create" more "credit" to lend. Current
"reserve" requirements allow them to use that $1 billion
in bonds to "create" as much as $15 billion in new
"credit" to lend to States, municipalities, businesses, and
individuals.
Added to the original $1 billion, they could have $16
billion of "created credit" out in loans paying them
interest with their only cost being $1,000 for printing the
original $1 billion! Since the U.S. Congress has not issued
constitutional money since 1863 (more than 130 years),
in order for the people to have money to carry on trade
and commerce they are forced to borrow the "created
credit" of the bankers and pay them usury -- interest!
The millions of working families of America are now
indebted to the few thousand banking families for twice
the assessed value of the entire United States. And these
banking families obtained that debt against us for the cost
of paper, ink, and book-keeping!
The Tyranny of Compound Interest
The only way new money (which is not true money, but
rather credit representing a debt) goes into circulation in
America is when it is borrowed from the bankers. When
the State and people borrow large sums, we seem to
prosper. However, the bankers "create" only the amount
of the principal of each loan, never the extra amount
needed to pay the interest. Therefore, the new money
never equals the new debt added. The amounts needed
to pay the interest on loans is not "created," and therefore
does not exist!
Under this system, where new debt always exceeds new
money no matter how much or how little is borrowed,
the total debt increasingly outstrips the amount of money
available to pay the debt. The people can never, ever get
out of debt!
The following example will show the viciousness of this
interest-debt system via its "built in" shortage of money.
When a citizen goes to a banker to borrow $60,000 to
purchase a home or a farm, the bank clerk has the
borrower agree to pay back the loan plus interest. At 14
percent interest for thirty years, the borrower must agree
to pay $710.92 per month for a total of $255,931.20.
The clerk then requires the borrower to assign to the
banker the right of ownership of the property if he does
not make the required payments. The bank clerk then
gives the borrower a $60,000 check or deposit slip,
crediting the borrower's checking account with $60,000.
The borrower then writes checks to the builder,
subcontractors, etc., who in turn write checks. $60,000
of new "checkbook" money is thereby added to the
"money in circulation."
However, this is the fatal flaw in the system: the only
new money created and put into circulation is the amount
of the loan -- $60,000. The money to pay the interest is
not created, and therefore was not added to the "money
in circulation." Even so, the borrower (and those who
follow him in ownership of the property) must earn and
take out of circulation $255,931, which is nearly
$200,000 more than he put into circulation when he
borrowed the original $60,000! Every new loan puts the
same process into operation. Each borrower adds a small
sum to the total money supply when he borrows, but the
payments on the loan (because of interest) then deduct a
much larger sum from the total money supply.
There is therefore no way all debtors can pay off the
money lenders. As they pay the principle and interest, the
money in circulation disappears. All they can do is
struggle against each other, borrowing more and more
from the money lenders each generation. The money
lenders (bankers), who produce nothing of value,
gradually gain a death grip on the land, buildings, and
present and future earnings of the whole working
population. Proverbs 22:7 has come to pass in America:
"The rich rules over the poor, and the borrower is
servant to the lender."
If you have not quite grasped the impact of the above, let
us consider a small auto loan for three years at 18
percent interest:
Step One: Citizen borrows $5,000 and pays it into
circulation (it goes to the dealer, factory, miner, etc.) and
signs a note agreeing to pay the bankers $6,500.
Step Two: Citizen pays $180 per month of his earnings
to the banker. In three years, he will remove from
circulation $1,500 more than he put into circulation.
Every loan of banker-"created" money (credit) causes the
same thing to happen. Since this has happened millions of
times since 1913 (and continues today), you can see why
America has gone from a prosperous, debt-free nation to
a debt-ridden nation where practically every home, farm,
and business is paying usury-tribute to the bankers.
In the millions of transactions made each year like those
just discussed, little actual currency changes hands, nor is
it necessary that it do so. About 95 percent of all "cash"
transactions in the United States are executed by check.
Consider also that banks must only hold ten percent of
their deposits on site in cash at any given time. This
means that 90 percent of all deposits, though they may
actually be held by the bank, are not present in the form
of actual cash currency. That leaves the banker relatively
safe to "create" that so-called "loan" by writing the check
or deposit slip, not against actual money, but against your
promise to pay it back! The cost to him is paper, ink, and
a few dollars of overhead for each transaction. It is
"check-kiting" on an enormous scale. The profits increase
rapidly, year after year.
Gambling Away the American Dream
To grasp the truth that periodic withdrawal of money
through interest payments will inexorably transfer all
wealth in the nation to the receiver of interest, imagine
yourself in a poker or dice game where everyone must
-- Paul Volker (ex-CEO@fed.org), April 26, 2000