Before we take a look at the “Greatest Crime in History”, I am including some quotes from some of histories greatest minds.  It is evident that great men of history did not view the Federal Reserve and some of its related institutions in a complimentary light.  (Some of these quotations are not credited but were instead taken from the many resource documents used to compile this report.  However, you will notice that the unaccredited entries are in complete agreement with those that are.)

 

The Greatest Crime In History

After years of careful study I am convinced that the illegal operation of the Federal Reserve is at the heart of almost every other problem we face in America.  Most people are not aware of how the Fed was created and the secrecy that was necessary to bring it about.  Most people are not aware that almost all inflation in America is a direct result of the illegal operation of the Fed.  Most people are not aware that the structure of the Fed are actually unconstitutional, treasonous in nature, and undermines the American economy and the sovereignty of this nation.

One must first understand how the Fed was created at Jeckyll Island by a group of wealthy criminals working behind the backs of the American public to create a central bank.  Then one must understand that the Fed is privately owned and has no Federal connections at all.  It is important to understand that a private citizen or group of any kind is not permitted to loan the government money because it compromises the sovereignty of the nation.  Any compromise of the nation’s sovereignty is called treason and is strictly forbidden by constitutional law.  The Federal Reserve has been passed off as a legitimate structure of national commerce since 1913.  However, the Fed has all but destroyed our nation’s freedoms, economic stability and will soon be the very instrument the wipes out the sovereignty of the United States of America.

In my observations I have concluded that the greatest threat to the Constitutional rights of the American public stems from and is made possible by the Federal Reserve.  It is not possible to understand the problems we currently face in America without having a proper understanding of the history, operation, and effects of the Federal Reserve System.

The following information should help you understand the urgency of abolishing the Federal Reserve.  We must give the power to coin money back to the Federal Government and reestablish sound money by backing the dollar with gold and silver.  Backing the dollar with gold will almost eliminate inflation in America.  Reestablishing the gold standard would permit small businesses to flourish and American citizens would have protection against their life savings.

As long as the Federal Reserve is permitted to operate, it is impossible to have effective legislation, reduce the national debt, or maintain the constitutional rights of the American citizen.  As long as the Fed is operational, it makes little difference who is elected to the oval office.  The presence of the Fed eliminates the effectiveness of law.  As long as we have the Federal Reserve or any such centralized banking system, we have no meaningful government for the people.  The active existence of the Fed makes all government entities impotent for the purposes of the people by placing the powers of government into the hands of a wealthy few.  We must abolish the Federal Reserve.

Upon signing the Federal Reserve Act into existence, Woodrow Wilson addressed the nation with these words.  “I am a most unhappy man.  I have unwittingly ruined my country.  A great industrial nation is now controlled by its system of credit.  We are no longer a government by free opinion, no longer a government by conviction and a vote of the majority, but a government by the opinion and duress of a small group of dominant men.”  Woodrow Wilson 1919”

Part I  “THE HISTORY AND CREATION OF THE FEDERAL RESERVE”

In 1913 the Federal Reserve Act was slipped passed Congress while many congressmen were on their holiday vacations.  There had been harsh resistance against a central bank for many years.  The founders considered any notion of a central bank an act of treason.  A central bank would ultimately undermine the sovereignty of the United States and usurp the government.  Paul Warburg suggested that they name this new institution The Federal Reserve so that it would not come across as a central bank.  Thanks to this little band of criminals we now have a small group of bankers secretly running the government from behind the scenes.

For those of you who are not savvy with government issues, listen very close.  Any time a privately owned entity lends money to the government it compromises the sovereignty of this nation and that is defined as treason by constitutional law.  The Federal Reserve is a privately owned entity making loans to the government and charging interest for it.  There is no reason our government should pay any interest on the creation of money when it was given the power to print money through constitutional law.  The U.S. Mint is in charge of supplying the money for the U.S. government at no cost to the United States citizen.  Why then would the government of the United States turn that right over to an entity that would charge us interest and ultimately bankrupt our nation?  I would like to assure you that this was accomplished by duress and deception.

In order to properly understand the problem with the Federal Reserve, one must understand the unsavory method in which it was created.  The following is the story of how a small group of wealthy bankers usurped the United States government and created a central bank called the Federal Reserve.

Jekyll Island

"The matter of a uniform discount rate was discussed and settled at Jekyll Island."--Paul M. Warburg1

On the night of November 22, 1910, a group of newspaper reporters stood disconsolately in the railway station at Hoboken, New Jersey. They had just watched a delegation of the nation’s leading financiers leave the station on a secret mission. It would be years before they discovered what that mission was, and even then they would not understand that the history of the United States underwent a drastic change after that night in Hoboken.

The delegation had left in a sealed railway car, with blinds drawn, for an undisclosed destination. They were led by Senator Nelson Aldrich, head of the National Monetary Commission. President Theodore Roosevelt had signed into law the bill creating the National Monetary Commission in 1908, after the tragic Panic of 1907 had resulted in a public outcry that the nation’s monetary system be stabilized. Aldrich had led the members of the Commission on a two-year tour of Europe, spending some three hundred thousand dollars of public money. He had not yet made a report on the results of this trip, nor had he offered any plan for banking reform.

Accompanying Senator Aldrich at the Hoboken station were his private secretary, Shelton; A. Piatt Andrew, Assistant Secretary of the Treasury, and Special Assistant of the National Monetary Commission; Frank Vanderlip, president of the National City Bank of New York, Henry P. Davison, senior partner of J.P. Morgan Company, and generally regarded as Morgan’s personal emissary; and Charles D. Norton, president of the Morgan-dominated First National Bank of New York. Joining the group just before the train left the station were Benjamin Strong, also known as a lieutenant of J.P. Morgan; and Paul Warburg, a recent immigrant from Germany who had joined the banking house of Kuhn, Loeb and Company, New York as a partner earning five hundred thousand dollars a year.

Six years later, a financial writer named Bertie Charles Forbes (who later founded the Forbes Magazine; the present editor, Malcom Forbes, is his son), wrote:

"Picture a party of the nation’s greatest bankers stealing out of New York on a private railroad car under cover of darkness, stealthily hiking hundred of miles South, embarking on a mysterious launch, sneaking onto an island deserted by all but a few servants, living there a full week under such rigid secrecy that the names of not one of them was once mentioned lest the servants learn the identity and disclose to the world this strangest, most secret expedition in the history of American finance. I am not romancing; I am giving to the world, for the first time, the real story of how the famous Aldrich currency report, the foundation of our new currency system, was written . . . . The utmost secrecy was enjoined upon all. The public must not glean a hint of what was to be done. Senator Aldrich notified each one to go quietly into a private car of which the railroad had received orders to draw up on an unfrequented platform. Off the party set, New York’s ubiquitous reporters had been foiled . . . Nelson (Aldrich) had confided to Henry, Frank, Paul and Piatt that he was to keep them locked up at Jekyll Island, out of the rest of the world, until they had evolved and compiled a scientific currency system for the United States, the real birth of the present Federal Reserve System, the plan done on Jekyll Island in the conference with Paul, Frank and Henry . . . . Warburg is the link that binds the Aldrich system and the present system together. He more than anyone man has made the system possible as a working reality."

The official biography of Senator Nelson Aldrich states:

"In the autumn of 1910, six men went out to shoot ducks, Aldrich, his secretary Shelton, Andrews, Davison, Vanderlip and Warburg. Reporters were waiting at the Brunswick (Georgia) station. Mr. Davison went out and talked to them. The reporters dispersed and the secret of the strange journey was not divulged. Mr. Aldrich asked him how he had managed it and he did not volunteer the information."3

Davison had an excellent reputation as the person who could conciliate warring factions, a role he had performed for J.P. Morgan during the settling of the Money Panic of 1907. Another Morgan partner, T.W. Lamont, says:  "Henry P. Davison served as arbitrator of the Jekyll Island expedition."

From these references, it is possible to piece together the story. Aldrich’s private car, which had left Hoboken station with its shades drawn, had taken the financiers to Jekyll Island, Georgia. Some years earlier, a very exclusive group of millionaires, led by J.P. Morgan, had purchased the island as a winter retreat. They called themselves the Jekyll Island Hunt Club, and, at first, the island was used only for hunting expeditions, until the millionaires realized that its pleasant climate offered a warm retreat from the rigors of winters in New York, and began to build splendid mansions, which they called "cottages", for their families’ winter vacations. The club building itself, being quite isolated, was sometimes in demand for stag parties and other pursuits unrelated to hunting. On such occasions, the club members who were not invited to these specific outings were asked not to appear there for a certain number of days. Before Nelson Aldrich’s party had left New York, the club’s members had been notified that the club would be occupied for the next two weeks.

The Jekyll Island Club was chosen as the place to draft the plan for control of the money and credit of the people of the United States, not only because of its isolation, but also because it was the private preserve of the people who were drafting the plan. The New York Times later noted, on May 3, 1931, in commenting on the death of George F. Baker, one of J.P. Morgan’s closest associates, that "Jekyll Island Club has lost one of its most distinguished members. One-sixth of the total wealth of the world was represented by the members of the Jekyll Island Club." Membership was by inheritance only.

The Aldrich group had no interest in hunting. Jekyll Island was chosen for the site of the preparation of the central bank because it offered complete privacy, and because there was not a journalist within fifty miles. Such was the need for secrecy that the members of the party agreed, before arriving at Jekyll Island, that no last names would be used at any time during their two week stay. The group later referred to themselves as the First Name Club, as the last names of Warburg, Strong, Vanderlip and the others were prohibited during their stay. The customary attendants had been given two week vacations from the club, and new servants brought in from the mainland for this occasion who did not know the names of any of those present. Even if they had been interrogated after the Aldrich party went back to New York, they could not have given the names. This arrangement proved to be so satisfactory that the members, limited to those who had actually been present at Jekyll Island, later had a number of informal get-togethers in New York.

Why all this secrecy? Why this thousand mile trip in a closed railway car to a remote hunting club? Ostensibly, it was to carry out a program of public service, to prepare banking reform which would be a boon to the people of the United States, which had been ordered by the National Monetary Commission. The participants were no strangers to public benefactions. Usually, their names were inscribed on brass plaques, or on the exteriors of buildings which they had donated. This was not the procedure which they followed at Jekyll Island. No brass plaque was ever erected to mark the selfless actions of those who met at their private hunt club in 1910 to improve the lot of every citizen of the United States.

In fact, no benefaction took place at Jekyll Island. The Aldrich group journeyed there in private to write the banking and currency legislation which the National Monetary Commission had been ordered to prepare in public. At stake was the future control of the money and credit of the United States. If any genuine monetary reform had been prepared and presented to Congress, it would have ended the power of the elitist one world money creators. Jekyll Island ensured that a central bank would be established in the United States which would give these bankers everything they had always wanted.

As the most technically proficient of those present, Paul Warburg was charged with doing most of the drafting of the plan. His work would then be discussed and gone over by the rest of the group. Senator Nelson Aldrich was there to see that the completed plan would come out in a form which he could get passed by Congress, and the other bankers were there to include whatever details would be needed to be certain that they got everything they wanted, in a finished draft composed during a onetime stay. After they returned to New York, there could be no second get together to rework their plan. They could not hope to obtain such secrecy for their work on a second journey.

The Jekyll Island group remained at the club for nine days, working furiously to complete their task. Despite the common interests of those present, the work did not proceed without friction. Senator Aldrich, always a domineering person, considered himself the chosen leader of the group, and could not help ordering everyone else about. Aldrich also felt somewhat out of place as the only member who was not a professional banker. He had had substantial banking interests throughout his career, but only as a person who profited from his ownership of bank stock. He knew little about the technical aspects of financial operations. His opposite number, Paul Warburg, believed that every question raised by the group demanded, not merely an answer, but a lecture. He rarely lost an opportunity to give the members a long discourse designed to impress them with the extent of his knowledge of banking. This was resented by the others, and often drew barbed remarks from Aldrich. The natural diplomacy of Henry P. Davison proved to be the catalyst which kept them at their work. Warburg’s thick alien accent grated on them, and constantly reminded them that they had to accept his presence if a central bank plan was to be devised which would guarantee them their future profits. Warburg made little effort to smooth over their prejudices, and contested them on every possible occasion on technical banking questions, which he considered his private preserve.

"In all conspiracies there must be great secrecy."5

The "monetary reform" plan prepared at Jekyll Island was to be presented to Congress as the completed work of the National Monetary Commission. It was imperative that the real authors of the bill remain hidden. So great was popular resentment against bankers since the Panic of 1907 that no Congressman would dare to vote for a bill bearing the Wall Street taint, no matter who had contributed to his campaign expenses. The Jekyll Island plan was a central bank plan, and in this country there was a long tradition of struggle against inflicting a central bank on the American people. It had begun with Thomas Jefferson’s fight against Alexander Hamilton’s scheme for the First Bank of the United States, backed by James Rothschild. It had continued with President Andrew Jackson’s successful war against Alexander Hamilton’s scheme for the Second Bank of the United States, in which Nicholas Biddle was acting as the agent for James Rothschild of Paris. The result of that struggle was the creation of the Independent Sub-Treasury System, which supposedly had served to keep the funds of the United States out of the hands of the financiers. A study of the panics of 1873, 1893, and 1907 indicates that these panics were the result of the international bankers’ operations in London. The public was demanding in 1908 that Congress enact legislation to prevent the recurrence of artificially induced money panics. Such monetary reform now seemed inevitable. It was to head off and control such reform that the National Monetary Commission had been set up with Nelson Aldrich at its head, since he was majority leader of the Senate.

The main problem, as Paul Warburg informed his colleagues, was to avoid the name "Central Bank". For that reason, he had decided upon the designation of "Federal Reserve System". This would deceive the people into thinking it was not a central bank. However, the Jekyll Island plan would be a central bank plan, fulfilling the main functions of a central bank; it would be owned by private individuals who would profit from ownership of shares. As a bank of issue, it would control the nation’s money and credit.

In the chapter on Jekyll Island in his biography of Aldrich, Stephenson writes of the conference:

"How was the Reserve Bank to be controlled? It must be controlled by Congress. The government was to be represented in the board of directors, it was to have full knowledge of all the Bank’s, affairs, but a majority of the directors were to be chosen, directly or indirectly, by the banks of the association."

Thus the proposed Federal Reserve Bank was to be "controlled by Congress" and answerable to the government, but the majority of the directors were to be chosen, "directly or indirectly" by the banks of the association. In the final refinement of Warburg’s plan, the Federal Reserve Board of Governors would be appointed by the President of the United States, but the real work of the Board would be controlled by a Federal Advisory Council, meeting with the Governors. The Council would be chosen by the directors of the twelve Federal Reserve Banks, and would remain unknown to the public.

The next consideration was to conceal the fact that the proposed "Federal Reserve System" would be dominated by the masters of the New York money market. The Congressmen from the South and the West could not survive if they voted for a Wall Street plan. Farmers and small businessmen in those areas had suffered most from the money panics. There had been great popular resentment against the Eastern bankers, which during the nineteenth century became a political movement known as "populism". The private papers of Nicholas Biddle, not released until more than a century after his death, show that quite early on the Eastern bankers were fully aware of the widespread public opposition to them.

Paul Warburg advanced at Jekyll Island the primary deception which would prevent the citizens from recognizing that his plan set up a central bank. This was the regional reserve system. He proposed a system of four (later twelve) branch reserve banks located in different sections of the country. Few people outside the banking world would realize that the existing concentration of the nation’s money and credit structure in New York made the proposal of a regional reserve system a delusion.

Another proposal advanced by Paul Warburg at Jekyll Island was the manner of selection of administrators for the proposed regional reserve system. Senator Nelson Aldrich had insisted that the officials should be appointive, not elected, and that Congress should have no role in their selection. His Capitol Hill experience had taught him that congressional opinion would often be inimical to the Wall Street interests, as Congressmen from the West and South might wish to demonstrate to their constituents that they were protecting them against the Eastern bankers.

Warburg responded that the administrators of the proposed central banks should be subject to executive approval by the President. This patent removal of the system from Congressional control meant that the Federal Reserve proposal was unconstitutional from its inception, because the Federal Reserve System was to be a bank of issue. Article 1, Sec. 8, Par. 5 of the Constitution expressly charges Congress with "the power to coin money and regulate the value thereof.". Warburg’s plan would deprive Congress of its sovereignty, and the systems of checks and balances of power set up by Thomas Jefferson in the Constitution would now be destroyed. Administrators of the proposed system would control the nation’s money and credit, and would themselves be approved by the executive department of the government. The judicial department (the Supreme Court, etc.) was already virtually controlled by the executive department through presidential appointment to the bench.

Paul Warburg later wrote a massive exposition of his plan, The Federal Reserve System, Its Origin and Growth7 of some 1750 pages, but the name "Jekyll Island" appears nowhere in this text. He does state: "But then the conference closed, after a week of earnest deliberation, the rough draft of what later became the Aldrich Bill had been agreed upon, and a plan had been outlined which provided for a ‘National Reserve Association,’ meaning a central reserve organization with an elastic note issue based on gold and commercial paper."

On page 60, Warburg writes, "The results of the conference were entirely confidential. Even the fact there had been a meeting was not permitted to become public." He adds in a footnote, "Though eighteen [sic] years have since gone by, I do not feel free to give a description of this most interesting conference concerning which Senator Aldrich pledged all participants to secrecy."

B.C. Forbes’ revelation of the secret expedition to Jekyll Island, had had surprisingly little impact. It did not appear in print until two years after the Federal Reserve Act had been passed by Congress, hence it was never read during the period when it could have had an effect, that is, during the Congressional debate on the bill. Forbes’ story was also dismissed, by those "in the know," as preposterous, and a mere invention. Stephenson mentions this on page 484 of his book about Aldrich.9

"This curious episode of Jekyll Island has been generally regarded as a myth. B.C. Forbes got some information from one of the reporters. It told in vague outline the Jekyll Island story, but made no impression and was generally regarded as a mere yarn."

The cover up of the Jekyll Island conference proceeded along two lines, both of which were successful. The first, as Stephenson mentions, was to dismiss the entire story as a romantic concoction which never actually took place. Although there were brief references to Jekyll Island in later books concerning the Federal Reserve System, these also attracted little public attention. As we have noted, Warburg’s massive and supposedly definite work on the Federal Reserve System does not mention Jekyll Island at all, although he does admit that a conference took place. In none of his voluminous speeches or writings do the words "Jekyll Island" appear, with a single notable exception. He agreed to Professor Stephenson’s request that he prepare a brief statement for the Aldrich biography. This appears on page 485 as part of "The Warburg Memorandum". In this excerpt, Warburg writes, "The matter of a uniform discount rate was discussed and settled at Jekyll Island."

Another member of the "First Name Club" was less reticent. Frank Vanderlip later published a few brief references to the conference. In the Saturday Evening Post, February 9, 1935, p. 25, Vanderlip wrote:

"Despite my views about the value to society of greater publicity for the affairs of corporations, there was an occasion near the close of 1910, when I was as secretive, indeed, as furtive, as any conspirator. . . . Since it would have been fatal to Senator Aldrich’s plan to have it known that he was calling on anybody from Wall Street to help him in preparing his bill, precautions were taken that would have delighted the heart of James Stillman (a colorful and secretive banker who was President of the National City Bank during the Spanish-American War, and who was thought to have been involved in getting us into that war) . . . I do not feel it is any exaggeration to speak of our secret expedition to Jekyll Island as the occasion of the actual conception of what eventually became the Federal Reserve System."

In a Travel feature in The Washington Post, March 27, 1983, "Follow The Rich to Jekyll Island", Roy Hoopes writes: 

"In 1910, when Aldrich and four financial experts wanted a place to meet in secret to reform the country’s banking system, they faked a hunting trip to Jekyll and for 10 days holed up in the Clubhouse, where they made plans for what eventually would become the Federal Reserve Bank."

Vanderlip later wrote in his autobiography, From Farmboy to Financier:10

"Our secret expedition to Jekyll Island was the occasion of the actual conception of what eventually became the Federal Reserve System. The essential points of the Aldrich Plan were all contained in the Federal Reserve Act as it was passed."

Professor E.R.A. Seligman, a member of the international banking family of J. & W. Seligman, and head of the Department of Economics at Columbia University, wrote in an essay published by the Academy of Political Science, Proceedings, v. 4, No. 4, p. 387-90:

"It is known to a very few how great is the indebtedness of the United States to Mr. Warburg. For it may be said without fear of contradiction that in its fundamental features the Federal Reserve Act is the work of Mr. Warburg more than any other man in the country. The existence of a Federal Reserve Board creates, in everything but in name, a real central bank. In the two fundamentals of command of reserves and of a discount policy, the Federal Reserve Act has frankly accepted the principle of the Aldrich Bill, and these principles, as has been stated, were the creation of Mr. Warburg and Mr. Warburg alone. It must not be forgotten that Mr. Warburg had a practical object in view. In formulating his plans and in advancing in them slightly varying suggestions from time to time, it was incumbent on him to remember that the education of the country must be gradual and that a large part of the task was to break down prejudices and remove suspicion. His plans therefore contained all sorts of elaborate suggestions designed to guard the public against fancied dangers and to persuade the country that the general scheme was at all practicable. It was the hope of Mr. Warburg that with the lapse of time it might be possible to eliminate from the law a few clauses which were inserted largely at his suggestion for educational purposes."

Now that the public debt of the United States has passed a trillion dollars, we may indeed admit "how great is the indebtedness of the United States to Mr. Warburg." At the time he wrote the Federal Reserve Act, the public debt was almost nonexistent.

Professor Seligman points out Warburg’s remarkable prescience that the real task of the members of the Jekyll Island conference was to “prepare a banking plan which would gradually (educate the country) and "break down prejudices and remove suspicion". The campaign to enact the plan into law succeeded in doing just that.

Part II  “THE ILLEGAL OPERATION OF THE FEDERAL RESERVE”

There are a lot of misconceptions concerning the IRS and the Federal Reserve in general.  Basically the IRS is a collection agency for the Fed.  If the Fed is no longer in service, the IRS would no longer be needed either.  In 1993 the IRS underwent its very first audit.  The Commissioner testified before Congress that the IRS in its annual report to Congress had knowingly been exaggerating the amount of money it claimed to be able to collect by over 86 billion dollars.  When asked to explain this mind boggling discrepancy, the GAO (Government Accounting Office) stated……”This audit was made extremely difficult because IRS existing systems were not designed to provide reliable financial information on their operations.”

 

The IRS is for the most part unaccountable to anyone.  This is because they are in concert with the Federal Reserve by collecting illegal taxes from the United States citizen.  One of the first things President Ronald Reagan did once in office was form the Grace Commission.  After an audit they concluded that 100% of what is collected from income taxes is absorbed by interest on the Federal debt.  All individual income tax revenues are gone before one nickel is spent on the services tax payers expect from the government.

 

For those of you who seem to think that your income tax is somehow legal, maybe you should take into account the opinions of the founding fathers and many other great minds of our country.

 

“If Congress has the right under the Constitution to issue paper money, it was given to be used by themselves, not to be delegated to individuals or corporations.”  President Andrew Jackson

 

“We will charge interest on money which we create out of nothing.”  John Houblon, first governor Bank of England

 

“From a legal standpoint, these banks are private corporations, organized under a special act of Congress, namely the Federal Reserve Act.”  William Harding, Governor 1921 Federal Reserve Board

 

 “…we conclude that the Federal Reserve Banks are not federal…but are independent, privately owned and locally controlled corporations…without day to day direction from the federal government.”  Lewis vs. U.S. 9^th Circuit Court  June 24, 1982

 

“I don’t like the income tax.  Every time we talk about these taxes we get around to the idea of ‘from each according to his capacity and to each according to his needs.’  That’s Socialism.  It’s written into the Communist Manifesto.  Maybe we ought to see that every person who gets a tax return receives a copy of the Communist Manifesto with it so he can see what’s happening to him.”  T. Coleman Andrews Former Commissioner IRS

 

The graduated income tax is the second of ten planks in the Communist Manifesto written by Karl Marx in 1848 as the blueprint for socialism.  A top official of the IRS resigned after an extensive two year study of the tax codes and various cases.  Joe Banister came to the conclusion that the Internal Revenue Service was collecting taxes from millions of American citizens who did not owe taxes.

 

Joe Banister was an IRS Criminal Investigator Division (IRS-CID) Special Agent.  A gun carrying law enforcement officer, fraud investigator and CPA, who was “encouraged” to resign after confronting his superiors with the results of his own two year investigation into claims made by tax researchers about allegations of the IRS deceiving the American public and exceeding its constitutional and statutory authority.  Mr. Banister concluded that the tax researchers were correct.  On Feb 8, 1999 Joe submitted a report to his boss on his findings.  On Feb 11, 1999 this report was sent on to his bosses boss.  On Feb 17, 1999 the report made it all the way to the IRS commissioner Rosotti.  Joe was then asked to resign.

 

“Based on research by the Congressional Research Service, there are no provisions which require an individual to pay an income tax.”

State Rep Phil Hart R-Idaho

 

Income means a corporate profit, not wages and labor.

 

In 2005 the illegal tax on your labor collected $927.2 billion, the legal corporate income tax collected $278.3 billion.

 

“You income tax is a 100% voluntary tax, and your liquor tax is a 100% enforced tax.  The situation is as different as night and day.”  Dwight F. Avis  Head of the Alcohol and Tobacco Tax Division Bureau of Internal Revenue

 

“Chief among such contracts is that of personal employment by which labor and other services are EXCHANGED for money and other forms of property.”  Coppage v. Kansas  236 US 1, 14 (1914)

 

The power to tax is the power to destroy.”  Supreme Court Chief Justice John Marshal

For those of you who seem to think our elected ones have our backs……..“We can’t be so fixated on our desire to preserve the rights of ordinary Americans.  Bill Clinton 3-11-93

 

The reason that the IRS constantly refers to the income tax as being voluntary is because of our U.S. Constitution and the severe limitations that are placed on the Federal Government and its ability to tax us.

 

“If you examined the 16^th Amendment carefully, you would find that a sufficient number of states never ratified that amendment.”  U.S. District Court Judge James C. Fox 2003

 

Part III “DEFECTS IN RATIFICATION OF THE 16^TH AMENDMENT”

The Sixteenth Amendment to the Constitution of the United States was never ratified by a majority of the sovereign States.

This is the Amendment that allegedly entitled the Federal Agent (government) in the federal territory of Washington, D.C. and their private collection company, the IRS, to collect "income tax" as falsely declared to be ratified in February 1913.

After an exhaustive year long search of legislative records in 48 sovereign states (Alaska & Hawaii were not admitted into the Union until after 1913). The only record of the 16th Amendment having been confirmed was a proclamation made by the Secretary of State Philander Knox on February 25, 1913, wherein he simply declared it to be "in effect", but never stating it was lawfully ratified.

Even if the 16th Amendment were properly ratified, according to Article 1, Section 9 of the Constitution, it has always been unconstitutional for the U.S. Federal Government to directly tax We the People in their property, wages, salaries, or earnings. The judges of the U.S. Supreme Court rejected any claims that the 16th Amendment changed the constitutional limits on direct taxes in Brushaber v. Union Pacific R.R. Co., 240 U.S. 1, when they ruled that it "created no new power of taxation" and that it "did not change the constitutional limitations which forbid any direct taxation of individuals".

Alleged defects in the ratification of the Income Tax Amendment

After investigating the history of the 16th Amendment, the following defects were found in the ratification of the Income Tax Amendment by the 48 states then existing, three-fourths or 36 of which were needed to ratify it:

 

In the above table, the line "Additional" are the number of states for which that defect is in addition to previously indicated defects, and "Accumulated" is a running total of states with defects, from Defect 01 through 10.

Since 36 states were required to ratify, the failure of 13 to ratify would be fatal to the amendment, and this occurs within the first three defects, arguably the most serious. Even if we were to ignore defects of spelling, capitalization, and punctuation, we would still have only two states which successfully ratified.

Note that in the above we are counting Ohio as a state, even though it was not admitted into the Union until 1953 (retroactively, which is expost facto, and unconstitutional). We are not counting the failure to designate the Income Tax Amendment as the "XVII" amendment, since there was arguably a 13th Amendment that was ratified but which is not published in official copies of the Constitution with Amendments, and the number is not necessarily part of the amendment (It wasn't part of the first 10.).

The authority usually cited for the criticality of ratification without errors of spelling, capitalization, or punctuation, is from DOCUMENT NO. 97-120, of the 97TH CONGRESS, 1st Session, entitled How Our Laws Are Made, written by Edward F. Willett, Jr. Esq., Law Revision Counsel of the United States House of Representatives, in which the comparable exactitude in which bills must be concurred under federal legislative rules is detailed:

...Each amendment must be inserted in precisely the proper place in the bill, with the spelling and punctuation exactly the same as it was adopted by the House. Obviously, it is extremely important that the Senate receive a copy of the bill in the precise form in which it passed the House. The preparation of such a copy is the function of the enrolling clerk. (at 34) (emphasis added).

When the bill has been agreed to in identical form by both bodies (either without amendment by the Senate, or by House concurrence in the Senate amendments, or by agreement in both bodies to the conference report) a copy of the bill is enrolled for presentation to the President.

The preparation of the enrolled bill is a painstaking and important task since it must reflect precisely the effect of all amendments, either by deletion, substitution, or addition, agreed to by both bodies. The enrolling clerk... must prepare meticulously the final form of the bill, as it was agreed to by both Houses, for presentation to the President...  each (amendment) must be set out in the enrollment exactly as agreed to, and all punctuation must be in accord with the action taken. (at 45) (emphasis added)

It should be noted that in his report on ratifications of the Income Tax Amendment to then Secretary of State Philander Knox, the Solicitor of the Department of State, recognized many of the defects of wording, spelling, capitalization, and punctuation, although he seemed ignorant of the constitutional and procedural defects at the state level. He also pointed out similar defects in the ratifications of the 14th and 15th Amendments. Therefore, Knox had plenty of clues to the problems in the ratifications, sufficient to justify that he inquire into the matter further and demand corrective action by the states. Because he failed to do so means that we now have adopted and enforced legislation for more than 80 years that is plainly unconstitutional, requiring not only that it be repealed, but that all the funds collected be refunded.

The states could, of course, re-ratify the Income Tax Amendment, but they could not do so retroactively. That would allow re-enactment of the Internal Revenue Code, and re-issuance of all the supporting regulations, but none of them could apply to the period prior to proper ratification of the amendment and due notices of the regulations.

Readers are invited to independently confirm or refute these results and to similarly investigate the ratifications of other constitutional amendments, both at the federal and state levels, and to issue similar reports on what they find.

Part IV  “PAST ATTEPTS TO ABOLISH THE FEDERAL RESERVE”

On June 4, 1963, a little known attempt was made to strip the Federal Reserve Bank of its power to loan money to the government at interest. On that day President John F. Kennedy signed Executive Order No. 11110 that returned to the U.S. government the power to issue currency, without going through the Federal Reserve. Mr. Kennedy's order gave the Treasury the power "to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury." This meant that for every ounce of silver in the U.S. Treasury's vault, the government could introduce new money into circulation. In all, Kennedy brought nearly $4.3 billion in U.S. notes into circulation. The ramifications of this bill are enormous.

With the stroke of a pen, Mr. Kennedy was on his way to putting the Federal Reserve Bank of New York out of business. If enough of these silver certificates were to come into circulation they would have eliminated the demand for Federal Reserve notes. This is because the silver certificates are backed by silver and the Federal Reserve notes are not backed by anything. Executive Order 11110 could have prevented the national debt from reaching its current level, because it would have given the government the ability to repay its debt without going to the Federal Reserve and being charged interest in order to create the new money. Executive Order 11110 gave the U.S. the ability to create its own money backed by silver.

After Mr. Kennedy was assassinated just five months later, no more silver certificates were issued. The Final Call has learned that the Executive Order was never repealed by any U.S. President through an Executive Order and is still valid. Why then has no president utilized it? Virtually all of the nearly $6 trillion in debt has been created since 1963, and if a U.S. president had utilized Executive Order 11110 the debt would be nowhere near the current level. Perhaps the assassination of JFK was a warning to future presidents who would think to eliminate the U.S. debt by eliminating the Federal Reserve's control over the creation of money. Mr. Kennedy challenged the government of money by challenging the two most successful vehicles that have ever been used to drive up debt - war and the creation of money by a privately-owned central bank. His efforts to have all troops out of Vietnam by 1965 and Executive Order 11110 would have severely cut into the profits and control of the New York banking establishment. As America's debt reaches unbearable levels and a conflict emerges in Bosnia that will further increase America's debt, one is force to ask, will President Clinton have the courage to consider utilizing Executive Order 11110 and, if so, is he willing to pay the ultimate price for doing so?

Executive Order 11110 AMENDMENT OF EXECUTIVE ORDER NO. 10289

AS AMENDED, RELATING TO THE PERFORMANCE OF CERTAIN FUNCTIONS AFFECTING THE DEPARTMENT OF THE TREASURY

By virtue of the authority vested in me by section 301 of title 3 of the United States Code, it is ordered as follows:

Section 1. Executive Order No. 10289 of September 19, 1951, as amended, is hereby further amended-

By adding at the end of paragraph 1 thereof the following subparagraph (j):

(j) The authority vested in the President by paragraph (b) of section 43 of the Act of May 12, 1933, as amended (31 U.S.C.821 (b)), to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury not then held for redemption of any outstanding silver certificates, to prescribe the denomination of such silver certificates, and to coin standard silver dollars and subsidiary silver currency for their redemption

and --

By revoking subparagraphs (b) and (c) of paragraph 2 thereof.

Sec. 2. The amendments made by this Order shall not affect any act done, or any right accruing or accrued or any suit or proceeding had or commenced in any civil or criminal cause prior to the date of this Order but all such liabilities shall continue and may be enforced as if said amendments had not been made.

John F. Kennedy The White House, June 4, 1963.

Of course, the fact that both JFK and Lincoln met the same end is a mere coincidence.

Abraham Lincoln's Monetary Policy, 1865 (Page 91 of Senate document 23.)

Money is the creature of law and the creation of the original issue of money should be maintained as the exclusive monopoly of national Government.

Money possesses no value to the State other than that given to it by circulation.

Capital has its proper place and is entitled to every protection. The wages of men should be recognized in the structure of and in the social order as more important than the wages of money.

No duty is more imperative for the Government than the duty it owes the People to furnish them with a sound and uniform currency, and of regulating the circulation of the medium of exchange so that labor will be protected from a vicious currency, and commerce will be facilitated by cheap and safe exchanges.

The available supply of Gold and Silver being wholly inadequate to permit the issuance of coins of intrinsic value or paper currency convertible into coin in the volume required to serve the needs of the People, some other basis for the issue of currency must be developed, and some means other than that of convertibility into coin must be developed to prevent undue fluctuation in the value of paper currency or any other substitute for money of intrinsic value that may come into use.

The monetary needs of increasing numbers of People advancing towards higher standards of living can and should be met by the Government. Such needs can be served by the issue of National Currency and Credit through the operation of a National Banking system .The circulation of a medium of exchange issued and backed by the Government can be properly regulated and redundancy of issue avoided by withdrawing from circulation such amounts as may be necessary by Taxation, Redeposit, and otherwise. Government has the power to regulate the currency and credit of the Nation.

Government should stand behind its currency and credit and the Bank deposits of the Nation. No individual should suffer a loss of money through depreciation or inflated currency or Bank bankruptcy.

Government possessing the power to create and issue currency and credit as money and enjoying the right to withdraw both currency and credit from circulation by Taxation and otherwise need not and should not borrow capital at interest as a means of financing Governmental work and public enterprise. The Government should create, issue, and circulate all the currency and credit needed to satisfy the spending power of the Government and the buying power of the consumers. The privilege of creating and issuing money is not only the supreme prerogative of Government, but it is the Governments greatest creative opportunity.

By the adoption of these principles the long felt want for a uniform medium will be satisfied. The taxpayers will be saved immense sums of interest, discounts, and exchanges. The financing of all public enterprise, the maintenance of stable Government and ordered progress, and the conduct of the Treasury will become matters of practical administration. The people can and will be furnished with a currency as safe as their own Government. Money will cease to be master and become the servant of humanity. Democracy will rise superior to the money power.

One of the most common concerns among people who engage in any effort to reduce their taxes is, "Will keeping my money hurt the government's ability to pay its bills?" As explained in the first article in this series, the modern withholding tax does not, and wasn't designed to, pay for government services. What it does do, is pay for the privately-owned Federal Reserve System.

Black's Law Dictionary defines the "Federal Reserve System" as, "Network of twelve central banks to which most national banks belong and to which state chartered banks may belong. Membership rules require investment of stock and minimum reserves."

Privately-owned banks own the stock of the Fed. This was explained in more detail in the case of Lewis v. United States, Federal Reporter, 2nd Series, Vol. 680, Pages 1239, 1241 (1982), where the court said:

Each Federal Reserve Bank is a separate corporation owned by commercial banks in its region. The stock-holding commercial banks elect two thirds of each Bank's nine member board of directors.

Similarly, the Federal Reserve Banks, though heavily regulated, are locally controlled by their member banks. Taking another look at Black's Law Dictionary, we find that these privately owned banks actually issue money:

Federal Reserve Act. Law which created Federal Reserve banks which act as agents in maintaining money reserves, issuing money in the form of bank notes, lending money to banks, and supervising banks. Administered by Federal Reserve Board (q.v.).

The FED banks, which are privately owned, actually issue, that is, create the money we use. In 1964 the House Committee on Banking and Currency, Subcommittee on Domestic Finance, at the second session of the 88th Congress, put out a study entitled Money Facts which contains a good description of what the FED is:

The Federal Reserve is a total money-making machine. It can issue money or checks. And it never has a problem of making its checks good because it can obtain the $5 and $10 bills necessary to cover its check simply by asking the Treasury Department's Bureau of Engraving to print them.

As we all know, anyone who has a lot of money has a lot of power. Now imagine a group of people who have the power to create money. Imagine the power these people would have. This is what the Fed is.

No man did more to expose the power of the Fed than Louis T. McFadden, who was the Chairman of the House Banking Committee back in the 1930s. Constantly pointing out that monetary issues shouldn't be partisan, he criticized both the Herbert Hoover and Franklin Roosevelt administrations. In describing the Fed, he remarked in the Congressional Record, House pages 1295 and 1296 on June 10, 1932, that:

Mr. Chairman, we have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve banks. The Federal Reserve Board, a Government Board, has cheated the Government of the United States and he people of the United States out of enough money to pay the national debt. The depredations and the iniquities of the Federal Reserve Board and the Federal reserve banks acting together have cost this country enough money to pay the national debt several times over. This evil institution has impoverished and ruined the people of the United States; has bankrupted itself, and has practically bankrupted our Government. It has done this through the maladministration of that law by which the Federal Reserve Board, and through the corrupt practices of the moneyed vultures who control it.

Some people think the Federal Reserve banks are United States Government institutions. They are not Government institutions. They are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory money lenders. In that dark crew of financial pirates there are those who would cut a man's throat to get a dollar out of his pocket; there are those who send money into States to buy votes to control our legislation; and there are those who maintain an international propaganda for the purpose of deceiving us and of wheedling us into the granting of new concessions which will permit them to cover up their past misdeeds and set again in motion their gigantic train of crime. Those 12 private credit monopolies were deceitfully and disloyally foisted upon this country by bankers who came here from Europe and who repaid us for our hospitality by undermining our American institutions.

The Fed basically works like this: The government granted its power to create money to the Fed banks. They create money, then loan it back to the government charging interest. The government levies income taxes to pay the interest on the debt. On this point, it's interesting to note that the Federal Reserve act and the sixteenth amendment, which gave congress the power to collect income taxes, were both passed in 1913. The incredible power of the Fed over the economy is universally admitted. Some people, especially in the banking and academic communities, even support it. On the other hand, there are those, both in the past and in the present that speak out against it. One of these men was President John F. Kennedy. His efforts were detailed in Jim Marrs' 1990 book, Crossfire:

Another overlooked aspect of Kennedy's attempt to reform American society involves money. Kennedy apparently reasoned that by returning to the constitution, which states that only Congress shall coin and regulate money, the soaring national debt could be reduced by not paying interest to the bankers of the Federal Reserve System, who print paper money then loan it to the government at interest. He moved in this area on June 4, 1963, by signing Executive Order 11,110 which called for the issuance of $4,292,893,815 in United States Notes through the U.S. Treasury rather than the traditional Federal Reserve System. That same day, Kennedy signed a bill changing the backing of one and two dollar bills from silver to gold, adding strength to the weakened U.S. currency.

Kennedy's comptroller of the currency, James J. Saxon, had been at odds with the powerful Federal Reserve Board for some time, encouraging broader investment and lending powers for banks that were not part of the Federal Reserve System. Saxon also had decided that non-Reserve banks could underwrite state and local general obligation bonds, again weakening the dominant Federal Reserve banks.

A number of "Kennedy bills" were indeed issued - the author has a five dollar bill in his possession with the heading "United States Note" - but were quickly withdrawn after Kennedy's death. According to information from the Library of the Comptroller of the Currency, Executive Order 11,110 remains in effect today, although successive administrations beginning with that of President Lyndon Johnson apparently have simply ignored it and instead returned to the practice of paying interest on Federal Reserve notes. Today we continue to use Federal Reserve Notes, and the deficit is at an all-time high.

The point being made is that the IRS taxes you pay aren't used for government services. It won't hurt you, or the nation, to legally reduce or eliminate your tax liability.

Part V  “THE SOLUTION”

It is important to understand that unless the American public correctly understands how the Federal Reserve came into being, how it operates, and how this operation is destroying our nation, there can never be a meaningful solution.  Until the American public demands the abolishment of the Federal Reserve and doesn’t back down from intimidation, we will continue to be plagued by this deadly system.

 

“The American people will never knowingly adopt socialism.  But under the name of liberalism, they will adopt every fragment of the socialist program, until one day America will be a socialist nation without knowing how it happened.”  Norman Thomas Presidential candidate U.S. Socialist Party

 

Our founders designed America as a constitutional Republic under the rule of written law.  Not a Democracy under the rule of opinion, or public policy guidelines.  The two forms of government are separated by a vast ocean of difference.  As students of history, the founders knew the Democrats always degenerate into favoritism, special interest groups, mob rule, and ultimately tyranny due to a majority of the uninformed public consistently and predictably voting to reflect those politicians who would guarantee them the redistribution of public wealth.  The founders knew that a Republic protects minority individuals against a malicious and willful majority.

 

“Because of what appears to be a lawful command on the surface, many citizens, because of their respect for what appears to be law, are cunningly coerced into waiving their rights due to ignorance.”  U. S. Supreme Court, U.S. v Minker, 350 US 179 at 187

 

We must be aware of these attempts to coerce and subvert our heritage and civil liberty.  Every encroachment must be challenged.  I am including the following entries as part of my solution section.  The authors of these documentaries have well define the threats being waged against our liberties using the federal Reserve and its related institutions.

Heal The Money System, Heal Society

by Suzanne Phillips

World Bank's former Chief Economist William Stiglitz was interviewed following his recent resignation in dissent of the bank's policies which cause economic devastation around the world. ( See: http://www.AttackOnAmerica.net - Under Commentary - The Globalizer Who Came In From The Cold ) At the end of his interview journalist Greg Palast concluded "the solution to world poverty and crisis is simple: remove the bloodsuckers."

To do this, it's necessary to understand how those who wield destructive financial might accumulate their power. Herewith a brief description of how a cleverly devised banking system robs the average person of the right to a decent life while providing enormous wealth for its corporate owners and stockholders:

Henry Ford, Sr., staunch member of the United States' business community, once said "If the people of the nation understood our banking and monetary system, I believe there would be a revolution before tomorrow morning."

How did such a system get started? How do they keep it going? In 1935 during the Great Depression, the Senate Committee on Banking and Currency questioned the role of money as a basic cause of nationwide bank failures. To explain the workings of our monetary system they called Robert Hemphill, a former credit manager of the Federal Reserve Bank of Atlanta, Georgia. Hemphill told the august committee a fable -'The Temple of the Thirteen Suns'.

The essence of this fable is that a rich man going on a journey wanted a way to pay expenses without having to haul his unwieldy supply of gold. The goldsmith agreed to store the gold at 10% interest and gave the traveler a receipt - an I.O.U. or letter of credit. After the traveler left, the goldsmith offered to lend this gold to any local merchant who would pledge all his possessions to him as security. In each case, the new borrower asked the goldsmith to keep the gold and give him a paper receipt. Thus the goldsmith still had all the gold - not to mention mortgages on the possessions of everyone who had borrowed from him! With each loan and payment of interest the goldsmith's fortune grew until he became the wealthier than everyone in town. Reflecting upon this state of affairs he said, "What a lead-pipe cinch! I can collect just as much usury on this phony money as on the real gold."

So began the banking business. Money is based on credit. To be used equitably, money must be issued and its value controlled by governments for the general welfare of the nation and its people.

There is no need for money to be created as interest-bearing notes. However, it's still being issued this way worldwide by private banks against the security of people's own personal wealth or the wealth of other nations. The 'money' you borrow from them is created 'out of thin air.' It's a piece of paper that indicates you have pledged your possessions in exchange for your promise to repay the lenders of this money - with interest!

The crucial point to understand is that the way money is created and issued determines the workings of the marketplace. Money issued at interest by private banks, such as the United States Federal Reserve Bank, brings with it an overwhelming debt which has devastating effects on its own people and around the world. In contrast, money issued by a government without interest would benefit everyone. Instead of creating artificial shortages and causing horrendous suffering, interest-free money would simply be a medium of exchange and could release the abundance of human production.

According to authors Fraser and Morse in Tomorrow's Money: "The money of modern civilization is credit.[which] represents real wealth (goods and services}. But -- all our credit-tokens have been issued at-interest or as debt-tokens. First we had goldsmiths issuing credit-at-interest money to individuals. Next we had private banks issuing credit-at-interest money to individuals and the State. Now we have a Credit-Cartel issuing credit-at-interest to the entire world. Today, our wealth - your credit, and mine and the Nation's - is monetized in this way." (1)

"In England the goldsmith's method of issuing money was legalized under the Bank Act of 1694. [British] William of Orange needed money and [the Rothschild family] offered King William their gold - $6,000,000 - at 8% if he would give them a charter for a bank. And Permit them to issue an equal amount in paper notes at interest to themselves!" (2)

What's the matter with private banks issuing the nation's money? "The interest system enables private corporations to regulate and control the Nation's money supply - for their benefit instead of Society's" (3) (Does this remind you of the 2001 scarce energy crisis in California which suddenly turned into a glut, or the way gasoline prices rise and fall at the will of the oil barons?)

Not only is the total debt from interest physically impossible to repay -especially if based on scarce precious metals - but "The interest tribute increases our taxes, lowers our buying power, depresses and oppresses the Nation's production and business.The power and privilege to issue and regulate money are Sovereign Rights. They belong to the Nation - to us -and have been usurped and stolen from the people and the Nation to whom they rightfully belong."

The American colonies' 1776 War of Independence against Britain was largely an effort to break free from the financial stranglehold placed upon them by the Bank of England. Space doesn't permit details of the struggle between Jefferson and Madison on the people's side vs. Alexander Hamilton representing a privileged group desiring to start a similar bank in the American colonies. Hamilton won and the private Bank of United States was chartered in 1791. "In all transactions, the Nation was to be jointly responsible with the bank - but was not - to receive any of the bank's profit's. Many other benefits accrued to enrich the bank and its stockholders, including a comprehensive tax exemption."

Many government and other leaders in the U.S. have understood the power that money issuance gives to those who control it.

In 1787 John Adams wrote to Thomas Jefferson "All the perplexities, confusion and distress in America arise not from defects in the Constitution, not from want of honor or virtue, so much as down-right ignorance of the nature of coin, credit and circulation."

President Abraham Lincoln: "By Government creation of money, the taxpayers will be saved immense sums of interest." Lincoln tried to change the system by having the Treasury Department issue "Greenbacks" which were non-interest bearing notes. He was assassinated in 1865.

President James A. Garfield: "Whoever controls the volume of money in any country is absolute master of all industry and commerce."

Article 1, Section 8 of the U.S. Constitution states "The Congress shall have power to borrow money on the credit of the United States...and to coin money, regulate the value thereof, and of foreign coin." But since the beginning of our country, bankers have been exercising de facto power in issuing the nation's money. In 1913, Congress passed the Federal Reserve Act which consolidated the power to issue and regulate the nation's money and handed it over to the Federal Reserve Corporation, a consortium of private bankers. Understand that the Federal Reserve Bank is "federal" in name only.

Congressman Charles A. Lindberg, Sr.: "This Act establishes the most gigantic trust on earth. When the President [Wilson] signs this bill the invisible government of the Monetary Power will be legalized. The worst legislative crime of the ages is perpetrated by this banking and currency bill."

Congressman Louis T. McFadden (for 22 years Chairman of the U.S. Banking Currency Commission): "The Federal Reserve (privately owned banks) are one of the most corrupt institutions the world has ever seen."

The U.S. public, taught to believe that our money is based on gold, becomes alarmed when someone reports that gold is missing from the Treasury. This no longer matters. Our money hasn't been backed by gold since 1935 when the Roosevelt administration took us "off the gold standard". The paper money issued by the Federal Reserve Bank reads: 'THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE.'

President John F. Kennedy signed Executive Order 11110 in 1963 giving the Treasury Department power to issue silver certificates as the base of U.S. money. Once sufficient silver certificates existed it would eliminate the demand for Federal Reserve notes. JFK was assassinated five months later. (See: http://www.rense.com/politics4/jflandfed.htm)

Others who championed the return of money issuance to the government included Congressmen Jerry Voorhis of California and Wright Patman of Ohio. These men understood what Mayer Anselm Rothschild, patriarch of the banking House of Rothschild, stated so clearly: "Permit me to issue and control the money of a nation, and I care not who makes its laws"

Workers around the world have vastly increased their productivity, yet their standard of living has fallen drastically. How many people work two jobs to pay back money created 'out of thin air' using their own personal credit? How many millions in this country die premature deaths because 'there's no money' for food and doctor's bills? How many people in the 'Third World' starve to death because their countries are burdened with enormous debts to international bankers? (In mid-2001, foreign debt owed to Western bankers was $3,000,000,000,000 - three trillion dollars!)

Human corruption has devastated the Earth to the point where many experts fear it's impossible to restore a healthy environment. A change in consciousness is absolutely necessary. We need to stop exploiting each other. We need to act in a kindly and beneficial way toward the Earth and each other. Returning the power of issuing each nation's money to its own government is one step that will ease financial burdens and stop massive genocide against our fellow beings.

(1) Tomorrow's Money by Felix J. Fraser and Elsa Peters Morse, New Age Publishing Co., 1948.

(2) (3) (4) (5) Ibid.

Sources re U.S. History: Financial History of the United States by Davis

Rich Dewey; The Financier and the Finances of the Revolution. Vol. I Wm.

Graham Summer; A World In Debt by Freeman Tilden; History of Great American Fortunes by Gustavus Myers; Journal of Wm Maclay; Constitutional Money by Etta M. Russell; works by Charles Beard; The Formation of the Constitution by G. Bancroft; The Story of Our Money, Olive Cushing Dwinell.

Paul Introduces Honest Money Act

Washington, DC-  Congressman Ron Paul, a leading advocate of sound money policies and an outspoken critic of the Federal Reserve, recently introduced legislation to repeal legal tender laws.  The Honest Money Act, HR 2779, would eliminate forced tender laws that compel Americans to accept fiat irredeemable paper-ticket or electronic money as their unit of account. 

Absent government intervention through legal tender laws, individuals acting through the market decide what they will use as money.  Historically, the free market has chosen some combination of gold and silver whenever they were available.  As Dr. Edwin Vieira, the nation’s top expert on constitutional money, stated: “A free market functions most efficiently and most fairly when the market determines the quality and the quantity of money that’s being used.” 

When government creates fiat money out of thin air, the purchasing power of existing dollars falls.  Fiat money erodes the value of savings, and is especially harmful to those living on fixed incomes.  Paul believes centralized planning in monetary affairs is as harmful as centralized planning in economic affairs.

“Fiat money is widely accepted only because of legal tender laws,” Paul stated.  “Throughout the 20th century, the legal tender power enabled politicians to fool the American public into believing the dollar no longer meant a weight of gold or silver. Instead, the government told the people that the dollar now meant a piece of government-issued paper backed up by nothing except the promises of the government to maintain a stable value of currency. Of course, history shows that the word of the government (to protect the value of the dollar) is literally not worth the paper it is printed on.”

“While legal tender laws harm ordinary citizens, they work to the advantage of large banks,” Paul continued.  “Banks have been improperly granted the special privilege of creating fiat irredeemable electronic money out of thin air through fractional reserve lending.  According to the Federal Reserve, since 1950 these private companies (banks) have created almost $8 trillion out of nothing. This has been enormously advantageous to them.”

Repeal of legal tender laws will help restore constitutional government and protect the people’s right to a medium of exchange chosen by the market, thereby protecting their current purchasing power as well as their pensions, savings, and other promises of future payment. Honest money serves the needs of ordinary people; fiat irredeemable paper-ticket electronic money improperly transfers the wealth of society to a small privileged financial elite.  Paul’s legislation simply seeks to offer Americans a choice between fiat money and traditional stores like gold and silver.

 

Abolish the Fed

by Rep. Ron Paul, MD

In the House of Representatives, September 10, 2002

Mr. Speaker, I rise to introduce legislation to restore financial stability to America's economy by abolishing the Federal Reserve. I also ask unanimous consent to insert the attached article by Lew Rockwell, president of the Ludwig Von Mises Institute, which explains the benefits of abolishing the Fed and restoring the gold standard, into the record.

Since the creation of the Federal Reserve, middle and working-class Americans have been victimized by a boom-and-bust monetary policy. In addition, most Americans have suffered a steadily eroding purchasing power because of the Federal Reserve's inflationary policies. This represents a real, if hidden, tax imposed on the American people.

From the Great Depression, to the stagflation of the seventies, to the burst of the dotcom bubble last year, every economic downturn suffered by the country over the last 80 years can be traced to Federal Reserve policy. The Fed has followed a consistent policy of flooding the economy with easy money, leading to a misallocation of resources and an artificial "boom" followed by a recession or depression when the Fed-created bubble bursts.

With a stable currency, American exporters will no longer be held hostage to an erratic monetary policy. Stabilizing the currency will also give Americans new incentives to save as they will no longer have to fear inflation eroding their savings. Those members concerned about increasing America's exports or the low rate of savings should be enthusiastic supporters of this legislation.

Though the Federal Reserve policy harms the average American, it benefits those in a position to take advantage of the cycles in monetary policy. The main beneficiaries are those who receive access to artificially inflated money and/or credit before the inflationary effects of the policy impact the entire economy. Federal Reserve policies also benefit big spending politicians who use the inflated currency created by the Fed to hide the true costs of the welfare-warfare state. It is time for Congress to put the interests of the American people ahead of the special interests and their own appetite for big government.

Abolishing the Federal Reserve will allow Congress to reassert its constitutional authority over monetary policy. The United States Constitution grants to Congress the authority to coin money and regulate the value of the currency. The Constitution does not give Congress the authority to delegate control over monetary policy to a central bank. Furthermore, the Constitution certainly does not empower the federal government to erode the American standard of living via an inflationary monetary policy.

In fact, Congress' constitutional mandate regarding monetary policy should only permit currency backed by stable commodities such as silver and gold to be used as legal tender. Therefore, abolishing the Federal Reserve and returning to a constitutional system will enable America to return to the type of monetary system envisioned by our nation's founders: one where the value of money is consistent because it is tied to a commodity such as gold.  Such a monetary system is the basis of a true free-market economy.

In conclusion, Mr. Speaker, I urge my colleagues to stand up for working Americans by putting an end to the manipulation of the money supply which erodes Americans' standard of living, enlarges big government, and enriches well-connected elites, by cosponsoring my legislation to abolish the Federal Reserve.

WHY GOLD?
By Llewellyn H. Rockwell, Jr.

As with all matters of investment, everything is clear in hindsight. Had you bought gold mutual funds earlier this year, they might have appreciated more than 100 percent. Gold has risen $60 since March 2001 to the latest spot price of $326.

Why wasn't it obvious? The Fed has been inflating the dollar as never before, driving interest rates down to absurdly low levels, even as the federal government has been pushing a mercantile trade policy, and New York City, the hub of the world economy, continues to be threatened by terrorism. The government is failing to prevent more successful attacks by not backing down from foreign policy disasters and by not allowing planes to arm themselves.  These are all conditions that make gold particularly attractive.

Or perhaps it is not so obvious why this is true. It's been three decades since the dollar's tie to gold was completely severed, to the hosannas of mainstream economists. There is no stash of gold held by the Fed or the Treasury that backs our currency system. The government owns gold but not as a monetary asset. It owns it the same way it owns national parks and fighter planes. It's just another asset the government keeps to itself.

The dollar, and all our money, is nothing more and nothing less than what it looks like: a cut piece of linen paper with fancy printing on it. You can exchange it for other currency at a fixed rate and for any good or service at a flexible rate. But there is no established exchange rate between the dollar and gold, either at home or internationally.

The supply of money is not limited by the amount of gold. Gold is just another good for which the dollar can be exchanged, and in that sense is legally no different from a gallon of milk, a tank of gas, or an hour of babysitting services.

Why, then, do people turn to gold in times like these? What is gold used for? Yes, there are industrial uses and there are consumer uses in jewelry and the like. But recessions and inflations don't cause people to want to wear more jewelry or stock up on industrial metal. The investor demand ultimately reflects consumer demand for gold. But that still leaves us with the question of why the consumer demand exists in the first place. Why gold and not sugar or wheat or something else?

There is no getting away from it: investor markets have memories of the days when gold was money. In fact, in the whole history of civilization, gold has served as the basic money of all people wherever it's been available. Other precious metals have been valued and coined, but gold always emerged on top in the great competition for what constitutes the most valuable commodity of all.

There is nothing intrinsic about gold that makes it money. It has certain properties that lend itself to monetary use, like portability, divisibility, scarcity, durability, and uniformity. But these are just descriptors of certain qualities of the metal, not explanations as to why it became money. Gold became money for only one reason: because that's what the markets chose.

Why isn't gold money now? Because governments destroyed the gold standard. Why? Because they regarded it as too inflexible. To be sure, monetary inflexibility is the friend of free markets. Without the ability to create money out of nothing, governments tend to run tight financial ships. Banks are more careful about the lending when they can't rely on a lender of last resort with access to a money-creation machine like the Fed.

A fixed money stock means that overall prices are generally more stable. The problems of inflation and business cycles disappear entirely. Under the gold standard, in fact, increased market productivity causes prices to generally decline over time as the purchasing power of money increases.

In 1967, Alan Greenspan once wrote an article called Gold and Economic Freedom. He wrote that:
"An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense – perhaps more clearly and subtly than many consistent defenders of laissez-faire – that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other. . . . This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights."

He was right. Gold and freedom go together. Gold money is both the result of freedom and its leading protector. When money is as good as gold, the government cannot manipulate the supply for its own purposes. Just as the rule of law puts limits on the despotic use of police power, a gold standard puts extreme limits on the government's ability to spend, borrow, and otherwise create crazy unworkable programs. It is forced to raise its revenue through taxation, not inflation, and generally keep its house in order.

Without the gold standard, government is free to work with the Fed to inflate the currency without limit. Even in our own times, we've seen governments do that and thereby spread mass misery. 

Now, all governments are stupid but not all are so stupid as to pull stunts like this. Most of the time, governments are pleased to inflate their currencies so long as they don't have to pay the price in the form of mass bankruptcies, falling exchange rates, and inflation.

In the real world, of course, there is a lag time between cause and effect. The Fed has been inflating the currency at very high levels for longer than a year. The consequences of this disastrous policy are showing up only recently in the form of a falling dollar and higher gold prices. And so what does the Fed do? It is pulling back now. For the first time in nearly ten years, some measures of money (M2 and MZM) are showing a falling money stock, which is likely to prompt a second dip in the continuing recession.

Greenspan now finds himself on the horns of a very serious dilemma. If he continues to pull back on money, the economy could tip into a serious recession. This is especially a danger given rising protectionism, which mirrors the events of the early 1930s. On the other hand, a continuation of the loose policy he has pursued for a year endangers the value of the dollar overseas.

How much easier matters were when we didn't have to rely on the wisdom of exalted monetary central planners like Greenspan. Under the gold standard, the supply of money regulated itself. The government kept within limits. Banks were more cautious. Savings were high because credit was tight and saving was rewarded. This approach to economics is the foundation of a sustainable prosperity.

We don't have that system now for the country or the world, but individuals are showing their preferences once again. By driving up the price of gold, prompting gold producers to become profitable again, the people are expressing their lack of confidence in their leaders. They have decided to protect themselves and not trust the state. That is the hidden message behind the new luster of gold.

Is a gold standard feasible again? Of course. The dollar could be redefined in terms of gold. Interest rates would reflect the real supply and demand for credit. We could shut down the Fed and we would never need to worry again what the chairman of the Fed wanted. There was a time when Greenspan was nostalgic for such a system. Investors of the world have come to embrace this view even as Greenspan has completely abandoned it. 

What keeps the gold standard from becoming a reality again is the love of big government and war. If we ever fall in love with freedom again, the gold standard will once more become a hot issue in public debate.

You can wage war against these atrocities as well.  Contact you representatives and urge them to support the following bills.

H.R. 2755 Federal Reserve Board Abolition Act.

 

H.R. 2779 The Honest Money Act.

The Honest Money Act, HR 2779, would eliminate forced tender laws that compel Americans to accept fiat irredeemable paper-ticket or electronic money as their unit of account.