It is probably only from this author in the study of monetary economics that you will read this exceptional contrary opinion ever written down in any website! No such opposing opinion is ever written either because of lack of knowledge or just due to fear of contradiction in the free market of ideas.
I listened to the whining desperation of “The Money Masters – How International Bankers Gained Control of America ” that predicted America ’s “economic crush”. The conjurers of doom are so powerfully controlling in their presentation and argument that it could force frightened ordinary Americans to flee to Timbuktu before the anticipated “crush” would turn this greatest nation on the planet into an economic graveyard!
The opening attack was against the Federal Reserve [Fed]. It made a bold statement that the nation’s national bank is NOT Federal; that it is a “private” bank! It claims that in this private bank, THERE IS NO RESERVE! It is a callous lie in both instances. The Fed is the Federal Government AND private banks operating as a government, not a private, entity! The contrary can only be told to and believed by the ignorant that because of revolt against excessive politics and too much politicking proliferate across the country.
The first thing I noticed in the google.com/video of this group of economic conjurers with a clandestine agenda was this glaring contradiction in their thesis of economic doom. You will see in the said video presentation that the revolutionary colonies would not have won the revolution had it not printed paper money to finance the revolutionary struggle for independence. It was called "colonial script" with hardly any equivalent reserve. They did what the Bank of England did, and like what the Federal Reserve had done — exercise the power that the people had delegated through Congress to print paper money to spend for development and progress, the result of which made this nation the greatest on the planet! Borrowing is not like Medusa's head that turn everyone to stone! In this regard, only ignorant Federal Reserve hate junkies jump into an empty swimming pool of adverse conclusions heads down first.
Is there a downside to this exercise of power to print money to build the great railways and the incomparable U.S. highways that linked all states in the country, to construct our tallest skyscrapers and to create our multibillion-dollar institutional infrastructures, etc. for the good of the commonweal thus creating what this nation looks like today? Of course there is always a downside, part of the material and social capital costs — every exercise of power has. But the Fed also administers relief as a result of unavoidable foul-ups. Besides, take note of the fact that corruption thrives in honesty, just as in corruption there can be also an exceptional honesty to corrupt and be corrupt.
Complaints of people at the edge of their wit are louder in the outback. When the economy is sick, the remedial pill the Fed prescribes is always bitter to swallow. But we must live in the real world, not in the world of the Wizard of Oz. Those who live there are those visionary attackers of modern economics who have not even gone to school to learn what the law of supply and demand mean.
One know-it-all libertarian critic from the Midwest hinterland who obviously had too much of Ron Paul under his skin, wrote his Congressman to amend the law of supply and demand! This faux pas howler is beyond redemption!
Here’s the lighthouse to look up to for guidance, to those who navigate the murky waters of ignorance before jumping into an empty swimming pool of misleading conclusion and misled belief head first: First thing to consider is, too much printing of money is too much if it is indeed too much and that is when it is beyond what is necessary. But who has the expertise to decide when is it too much, or what is the right amount that is needed?
Don’t say that it is the complaining taxi driver or the angry gravedigger who suddenly turned themselves into monetary experts. At the wink of an eye, their conjurers claim they are the righteous little ones the public should believe when they say that the sky is falling! Understandably that’s because they are the ones who get hurt first. Against this, the founders of this great nation and the wise men that came after them thought it was the Fed that has such expertise. Our illustrious forebears expressed their wisdom through the act of Congress when they created the Federal Reserve in 1913.
To the ignorant, the second important point to consider is that – and this is the most critical point to understand — the Fed is made up of bankers AND the Federal Government. It is the people’s government acting through the President they elect, and Congress representing them that became the Fed itself by the act of the Legislature.
THE FED IS NOT A PROPERTY OF PRIVATE BANKERS as most economic hillbillies were tragically conjured to believe it is!!!
And here is the comic irony creating this tragic belief that the Fed is a private bank: In politics when a doctor of medicine who acts as a know-it-all economic pundit tells us that we are doomed if we do not revolt against the government for allowing private bankers [the Fed] to run our lives, only politically sick junkies would rush down the basement armory for handguns and assault weapons ready to shoot.
Notice a bunch of extreme revolutionary libertarians that the public mostly read in Freedomphoenix.com who are aggressive exponents of this winless campaign [they call it their own “Revolution”] against anything federal that stands between them and a society without any existing governmental authority to govern.
I am not inventing anything here. This is just citing some incredible facts about the revolt of pea-brain Winnie-the-Pooh in Hundred Acre Wood. Citing these facts as a sprinkle of literature not to spite but to spice this editorial report does not mean that I intend to demean a popular honey-crazed cartoon character or put down a website [FP.com] that I have no power to change for what it is, especially when the owner proudly claims that it is his own property and he can do whatever he wants to do with it! The fact that many enticed writer-contributors complain about this authoritarian claim of media ownership that ignores public interest and because it is selfishly motivated it trumps free expression of ideas is of no moment. These strong advocates of Austrian economics that want income tax [IRS] and the Fed abolish because of this notoriously stupid argument that our forebears created these Federal agencies to rob the American people blind, come from the beat of the drums in the street where the little knowledge of ignorant activists becomes dangerous!
The danger to guard against this threat to national security is that anger, when limited to freedom of expression is permissible, but not when rage calls to arms, incites the desperate to kill or bomb buildings and send bloodied limbless innocent bystanders to ICUs fighting for dear life. That kind of “Revolution” in the name of freedom of expression is to me a crime punishable by hanging which in comparison lethal injection is an act of mercy.
The third most important point to accept as an unimpeachable reality is that Federal Reserve policies are formulated by the American people themselves acting through Congress, and through the President they elected to office. Only the ignoramus who could no longer be helped from the quagmire of ignorance where they are wallowing now would say that it is the bankers only that decide to print money to satisfy their greed for wealth! It is “they” – the people [the Executive & Congress, acting through the Fed’s Board of Governors] not just the banker counterpart — who decide to print money that is required to spend for national development.
By the way, it is not the “printing” of money that funded and won our historic multibillion-dollar wars that changed the world; we left the “colonial script” antiquity and embarked on the use of modern credit ingenuity, paid for our mind-boggling size of development expenditures to reach the outer space and put us on the right track of unimaginable progress where we are now compared to where we were hundred years ago … it is the expansion of modern and well developed credit system we have created and used at our own disposal that should have turned on the light for the ignorant in revolt still living in the dark ages! It is this advantage so unique in our system that we live in our modern daily lives in this millennium that now makes us lead the global economy.
Make no mistake about it. Had we have been too shy to spend beyond the combined worth of all the Gold and Silver that we have had in reserve in our bank vaults including those deposited in Fort Knox – as the ignorant argument mostly propounded by Federal “rebels” would like to blind the people with such incredible lie — we would not have built our mega billion dollar railroads and national highways by now that tremendously expanded commerce by leaps and bounds, constructed our space program for landing in the Moon and beyond, as well as developed our defense weaponry second to none, making us the richest and the most powerful nation on the planet! This is a repeat worth restating again and again to penetrate the thick skull of ignorance and cynicism that are now dangerously leading us down the road to perdition.
We all have our gripes against the Federal Government. The bureaucracy that we are all encumbered upon is no secret to anyone, just to cite an example. Government officials that cut corners to feather their nest, is another ground for endless protests, and so are power-drunk agents of law who act like Idi Amin Dada of Uganda using the truncheon to suppress our individual liberties.
But the point I am trying to drive home here is not for penny-ante thinkers that attack the Federal Government to promote a political agenda against any rational economic deficit spending viewed not as a positive budgetary exercise but only as a negative misadventure in economics. You have to go to advance schools of economics to know that the shade of this controversial issue is gray – not absolutely pit black as the economic conjurers in the video are so obsessed about in spreading their prophesy of doom.
Let it sink without an iota of doubt that the Fed performs a “governmental function”, not a “private” function which the angry libertarian gravediggers were coached to believe out of empathy because the conjurers thought they are the most economically disadvantaged lot in our society whose complaints heavens would hear and act to save them. The socially disadvantaged would easily pick up the hammer and sickle and rush down the street for a Bastille-like revolt. Such plot to mislead millions of less sophisticated members of our free society for whatever purpose it intends to achieve is not just a waste of time and energy but also dangerous! If as a nation we have to disintegrate by adopting President Obama’s destructive left-leaning ideology for a change in extremis, it should be for a reason and a way better than a folly like this.
The fourth question to ask [and there is a built-in answer to it] is: Since these monies printed wantonly are extravagant “borrowing”, to quantify how much is the resulting debt owed is definitely mind-boggling. Why? It is because the national debt owed is translated into a staggering amount of wealth that made this nation the greatest, the wealthiest and the mightiest on the planet!
If you are staggered by the enormous size of the wealth and power of this nation that built up throughout the years, so should you be by the debt it owes that made it what it is today! It is our system of progress we alone could congregate about as time passes by, marshal and muster it no other people of the world can. It is a dirty lie – a despicable dishonesty, to be polite about it — for vain politicians to show the American people one side of the coin and blind them of the other side of the coin then for political and now ideological expediency. One-sided radical Liberals and Socialists led by Obama now in power caught up by revolutionary Libertarians are on this warpath of deception.
The fifth element to consider in this elementary analysis may surprise everyone: The cynical revolutionary would do a mathematical calculation to present a scenario of catastrophic fate that supposedly awaits this nation, i.e., the generations to come would be required to pay for that mind-blowing size of existing I.O.Us. That is not true and that will never happen, except in one’s unschooled imagination.
Let’s talk about reality out of the figment of a horrifying imagination in the bayou. Today you and I were the future generations of debt-fear-mongers about a century ago who opposed the building of America that required a massive spending and since there was not enough money on hand then it therefore needed a gargantuan amount of “borrowing” for future generations to pay.
Let’s hear again this broken record played throughout the ages: The giant projects of constructing highways and freeways that connected America from state to state resulting in an unprecedented national economic growth never imagined before were supposed to “burden” this present 2009 generation when viewed from the past. Did your life and mine become worse today because it was supposed to have been “burdened” by “debts” [the “borrowed” cost of development some years back], compared to life we now live today? Is it not true that when we look back a century ago our present modern transportation infrastructure today was just a wayward imagination to those who were campaigning against deficit spending?
On the contrary, did life not even become better now than it was then? We have “overspent” – borrowed then with sky was the limit] only with a government guarantee [just what the word of the Government is worth] – far beyond whatever Silver and Gold we held in the vault, and made it to where we are now. C’mon, let’s be realistic and admit it! This weird financial whining we hear today is but a spending rebellion with a cause, but not quite, as what it is pictured to be!
Sixth, here’s a reality check with a shocking neutralizing effect: Our gargantuan debts will just continue to increase and will just remain I.O.Us. as the years go by, for as long as the United States of America continues to grow. The opportunity to grow is limitless … in Genesis, it ends at Alpha X [the beginning of infinity]. Why? It is because those I.O.Us. are commonly viewed in the distant time at the wrong end of the telescope. The meaning of growing I.O.Us can only be viewed positively by those who understand what these are to the growing power of America. But these are also weapons political opportunists are using to intimidate people to vote them to office. Terror and their minions — enemies within who are accomplices — use I.O.Us as poison, some kind of economic nuclear devices they can explode as the launching of another 911 had become more difficult under former President George W. Bush's watch. The truth of the matter is that those I.O.Us are the material and social cost that approximate the total VALUE of a transformed United States of America – the approximate worth [assets] of this wealthiest, mightiest and the greatest nation ever seen on the planet at any given time!
Seventh, there will be no collapse of the national economy that toothless tigers pictured worse than that of the 1920s. That's fantasy in a science fiction story that I nominate to win next year's Academy Award! #
© Copyright Edwin A. Sumcad. Access NWS March 26, 2009.
The writer is an award-winning journalist. Go to NWS homepage, click on the columnist button to know more about the author or you may e-mail your comment at email@example.com.