Banking was conceived in inequity and born in sin
The essence of banking was once explained by Sir Josiah Stamp, a former president of the Bank of England:
"The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banking was conceived in inequity and born in sin... Bankers own the earth. Take it away from them but leave them the power to create money, and, with a flick of a pen, they will create enough money to buy it back again... Take this great power away from them, or if you want to continue to be the slaves of bankers and pay the cost of your own slavery, then let bankers continue to create money and control credit."
The last great abuse of our banking system caused the depression of the 1930's. Today's abuses may cause another. Past and Current S&L and bank scandals, illegal receipt of campaign funds, illustrate the on-going relationships between banks, lawyers, politicians, and government agencies (look at the BCCI bank scandal, involving lawyer Clark Clifford, politician Jimmy Carter, the Watergate and Mena Airport scandals involving William Clinton and others, all involving the Federal Reserve, the FDIC, and even the FBI and the CIA, scandals even too numerous to mention). These scandals are the direct result of years of law-breaking by an alliance of bankers and lawyers using their influence and money to corrupt the political process and rob the public. (Do you think you're not being robbed? Guess who's going to pay the bill for the excesses of the banks, lawyers, politicians, and government agencies? You are! -- in money, work, sweat, blood and tears!)
The systematic robbery of productive individuals by parasitic bankers and lawyers is not a recent phenomenon. This abuse is a human tradition that predates the Bible and spread from Europe to America despite early colonial prohibitions.
When the first United States Bank was chartered by Congress in 1790, there were only three state banks in existence. At one time, banks were prohibited by law in most states because many of the early settlers were all too familiar with the practices of the European goldsmith banks.
Goldsmith banks were safe-houses used to store client's gold. In exchange for the deposited gold, customers were issued notes (paper money) which were redeemable in gold. The goldsmith bankers quickly succumbed to the temptation to issue "extra" notes, (unbacked by gold). Why? Because the "extra" notes enriched the bankers by allowing them to buy property with notes for gold that they did not own, gold that did not even exist.
Colonists knew that bankers occasionally printed too much paper money, found themselves over-leveraged, and caused a "run on the bank". If the bankers lacked sufficient gold to meet the demand, the paper money became worthless and common citizens left holding the paper were ruined. Although over-leveraged bankers were sometime hung, the bankers continued printing extra money to increase their fortunes at the expense of the productive members of society.
(The practice continues to this day with the Federal Reserve System, and offers "sweetheart" loans to bank insiders, and even provides the foundation for deficit spending and the federal government's unbridled growth of the federal debt.)
If the colonists forgot the lessons of goldsmith bankers, the American Revolution refreshed their memories. To finance the war, Congress authorized the printing of continental bills of credit in an amount not to exceed $200,000,000. The States issued another $200,000,000 in paper notes. Ultimately, the value of the paper money fell so low that they were soon traded on speculation from 1000 to 5000 paper bills for one coin.
It's often suggested that our Constitution's prohibition against a paper economy -- "No State shall... make any Thing but gold and silver Coin a tender in Payment of Debts" -- was a tool of the wealthy to be worked to the disadvantage of all others. But only in a "paper" economy can money reproduce itself and increase the claims of the wealthy at the expense of the productive.
"Paper money," said Pelatiah Webster, "polluted the equity of our laws, turned them into engines of oppression, corrupted the justice of our public administration, destroyed the fortunes of thousands who had confidence in it, enervated the trade, husbandry, and manufactures of our country, and went far to destroy the morality of our people." |
