Congressman Ron Paul has for many years been the lone voice crying in the “wilderness” of Congress for an end to the exploitative and disruptive central banking monetary system. Once again he has called for abolition of the Federal Reserve Banks and Board, and recently introduced a bill that would accomplish that. In his introductory remarks, he also called for government to issue only currency that is “backed by stable commodities such as silver and gold to be used as legal tender.”
While I agree with the need to abolish the Fed (and all similarly structured central banks that exist in most other countries around the world), and I agree that the power of the banks and the federal government to debase the currency needs to be curtailed, it is extremely unlikely that legislation adequate to that task can ever make it through Congress. Nonetheless, I applaud Congressman Paul’s efforts because they will at least accomplish the job of raising awareness in the public mind about the nature of the money problem.
Eventually, it may be possible to act effectively at the governmental level, but only after the people have strongly asserted their own power to mediate the exchange process using their own credit apart from banks and the political money system. Only that assertion can bring about the “true free-market economy” that Mr. Paul desires. The nature of this power and how we can assert it are thoroughly addressed in my upcoming book, The End of Money and Future of Civilization.(Due to be released in April, 2009 by Chelsea Green Publishing). – t.h.g.
The following was taken from http://www.lewrockwell.com/paul/paul504.html.
End the Fed
by Ron Paul
Before the US House of Representatives, February 4, 2009, introducing The Federal Reserve Board Abolition Act, H.R. 833.
Madame Speaker, I rise to introduce legislation to restore financial stability to America’s economy by abolishing the Federal Reserve. 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 current economic crisis caused by the housing bubble, every economic downturn suffered by this country over the past century 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 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.
Dr. Ron Paul is a Republican member of Congress from Texas.
*************************************************************
Here is the bill as introduced in the House.
Taken from http://thomas.loc.gov/cgi-bin/query/z?c111:h833:
Federal Reserve Board Abolition Act
HR 833 IH
111th CONGRESS
1st Session
H. R. 833
To abolish the Board of Governors of the Federal Reserve System and the Federal reserve banks, to repeal the Federal Reserve Act, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
February 3, 2009
Mr. PAUL introduced the following bill; which was referred to the Committee on Financial Services
A BILL
To abolish the Board of Governors of the Federal Reserve System and the Federal reserve banks, to repeal the Federal Reserve Act, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘Federal Reserve Board Abolition Act’.
SEC. 2. FEDERAL RESERVE BOARD ABOLISHED.
(a) In General- Effective at the end of the 1-year period beginning on the date of the enactment of this Act, the Board of Governors of the Federal Reserve System and each Federal reserve bank are hereby abolished.
(b) Repeal of Federal Reserve Act- Effective at the end of the 1-year period beginning on the date of the enactment of this Act, the Federal Reserve Act is hereby repealed.
(c) Disposition of Affairs-
(1) MANAGEMENT DURING DISSOLUTION PERIOD- During the 1-year period referred to in subsection (a), the Chairman of the Board of Governors of the Federal Reserve System–
(A) shall, for the sole purpose of winding up the affairs of the Board of Governors of the Federal Reserve System and the Federal reserve banks–
(i) manage the employees of the Board and each such bank and provide for the payment of compensation and benefits of any such employee which accrue before the position of such employee is abolished; and
(ii) manage the assets and liabilities of the Board and each such bank until such assets and liabilities are liquidated or assumed by the Secretary of the Treasury in accordance with this subsection; and
(B) may take such other action as may be necessary, subject to the approval of the Secretary of the Treasury, to wind up the affairs of the Board and the Federal reserve banks.
(2) LIQUIDATION OF ASSETS-
(A) IN GENERAL- The Director of the Office of Management and Budget shall liquidate all assets of the Board and the Federal reserve banks in an orderly manner so as to achieve as expeditious a liquidation as may be practical while maximizing the return to the Treasury.
(B) TRANSFER TO TREASURY- After satisfying all claims against the Board and any Federal reserve bank which are accepted by the Director of the Office of Management and Budget and redeeming the stock of such banks, the net proceeds of the liquidation under subparagraph (A) shall be transferred to the Secretary of the Treasury and deposited in the General Fund of the Treasury.
(3) ASSUMPTION OF LIABILITIES- All outstanding liabilities of the Board of Governors of the Federal Reserve System and the Federal reserve banks at the time such entities are abolished, including any liability for retirement and other benefits for former officers and employees of the Board or any such bank in accordance with employee retirement and benefit programs of the Board and any such bank, shall become the liability of the Secretary of the Treasury and shall be paid from amounts deposited in the general fund pursuant to paragraph (2) which are hereby appropriated for such purpose until all such liabilities are satisfied.
(d) Report- At the end of the 18-month period beginning on the date of the enactment of this Act, the Secretary of the Treasury and the Director of the Office of Management and Budget shall submit a joint report to the Congress containing a detailed description of the actions taken to implement this Act and any actions or issues relating to such implementation that remain uncompleted or unresolved as of the date of the report.
# # #
Tags: Federal Reserve, Ron Paul
May 10, 2010 at 7:08 am |
All proposals to tinker with the existing monetary system, such as Ron Paul’s proposal to eliminate the Federal Reserve, will in the end not solve the nation or the world’s real economic problem: capitalism cannot exist without a staircase wage structure necessary to make profits possible. Such a wage structure leds to economic class division, which in its most radical dimension is the root cause of all social problems.
The solution is the Wealth Exchange System explained in my book of essays, Naked America. Abolish money, which is totally unnecessary for production. Replace it with a WES credit card that serves as a symbol of citizenship and community, and gives all holders the right to an equal share of society’s goods and services — if they work a job having to do with the production of life’s necessities and/or the generation of ideas and technologies that will allow humankind to survive.
Such a system would eliminate all the superfluous jobs that distribute the limited supply of money inequitably, including financial services, most entertainment, professional sports and other bread-and-circus events, as well as the innumerable economic activities (e.g., bling, country clubs) designed to provide individuals with some alleged symbol of their superiority.
In the moneyless economy and society, recognition and leadership will be earned as a reward for the superiority of one’s ideas and work, and that’s the only individual distiction worth having.
An unsophisticated barter system worked in several ancient empires that lacked the technological tools that now exist to make it work efficiently and justly. The only real impediment to the moneyless economy is the selfish aspect of human nature.
April 9, 2010 at 3:24 pm |
Wow, when someone can look back on a business venture that has cost so much wealth and opportunity and brought countless suffering and loss of life to so many and call it admirable, one has truly lost touch with his humanity.
The evils of this international banking cartel are well documented. Do your research. In the pursuit of profit, these unscrupulous men, fund both sides of wars, execute anyone that stands in their way and routinely enslave countries, business and individuals through the use of debt creation via fractional reserve lending and currency manipulation.
The central bankers of the world will undoubtedly continue their “business objectives” to streamline their product, increase market share and penetration yadda, yadda, yadda as you so eloquently point out. God help us when the currency is no longer the product, which is really the case in many countries.
The paper, or gold, or oil or debt or whatever people are willing to trade for their needs is just that, another commodity. The issue and exchange of any currency is merely an agreement. When the vast majority of the people wake up to this fact… as is what is happening at this very moment around the world… they will at some point choose not to agree anymore. And then “all their money just buys another minute by”.
The idea of peoples issuing their own currency and forming their own trade outside of the controls of these monopolies is a natural evolution of the awareness of humanity. This is inevitable. The central bankers know this, the one sure thing that they fear is our waking up to the fact that we don’t have to agree anymore. Once we make the choice to simply not value what they value… they are no richer than anyone else… as is always the case anyway.
February 20, 2010 at 12:43 pm |
I always thought that a world wide Technate would be the best system in the world. An organized group of unbiased, nonpolitical, nonsectarian, non-for profit engineers and technical experts who would simply gather together and utilize all that they know about abundant FREE and clean ENERGY technologies and resources for the betterment of ALL by simply measuring the most effective and or energy efficient ways to operate the entire worlds production and distribution system without any form of political and or monetary interference getting in their way. But that’s way too real for people to get a grasp on, so we need believers in their to throw there two cents worth of ego into the fray and screw things up, so the next best system is a Constitutional Republic based on the principals of sound money, so we’ll have to figure out how to go back in time and de-evolve, and to do this we’ll need lots of gold which is already owned and controlled by the same interests that currently own the FED. So, I think we’re fooling ourselves into believing we can go back in time.
I mean we’re not that stupid to believe that there’s still any gold left in Fort Knox after all those pirates took control of the monetary system in 1913, are we?
August 6, 2009 at 10:26 pm |
BUY THE FED
A bit outrageous?
Unthinkable?
Willing to look at ONE possibility?
The thought of buying the Federal Reserve is most likely an outrageous statement to most. However, think: Congress created the privately owned Federal Reserve in 1913 (a bit suspiciously, I might add) therefore it can un-create the Federal Reserve as soon as it wants to…(or has the guts!)
Recently Senator Dodd and Senator Schumer were rejected when they requested credit card companies to immediately halt retroactive interest rate increases from the Federal Reserve.
Heck…I say…TELL THEM! Individuals in Congress have to start taking their leadership role and change the behavior of the Federal Reserve from transferring wealth to a few to all citizens of the United States.
One of the reasons the Federal Reserve exists is to keep all of us including many nations in perpetual debt, something I let go of years ago.
I believe the United States Government can also get out of debt. Here’s how!
In 8 years, the greatest ECONOMIC IDEA ever to hit America could come to fruition!
The Goal: For the United States to be out of debt and have global prosperity.
How? On April 15, 2009, I sent the President eight seeds of rice and a check for $220 Trillion Dollars. The seeds were real, the check was not, but could be if the current President follows the revolutionary act of planting the seed at the White House and then creating “The Bank of the Greater United States.” (“Greater” because one seed is more powerful in its ability to regenerate interest than any paper money, especially the declining Federal Reserve Note!)
In eight years, that one seed of rice planted in the White House Garden will produce 214 grains of rice. If they are planted in the spring of 2010 and all the grain is harvested and planted for seven years, then in the Fall of 2017 the United States will have 4 quintillion, 398 quadrillion, 556 trillion, 620 billion, 369 million, 714 thousand and 700 hundred grains of rice. Divide that by 20,000, the number of grains it takes to make a pound, and you have 219,927,831,018,485 lbs of grain. Say in 2017, rice is valued at a $1.00 a pound. The total value of the grain would be $220 Trillion. Now that truly is greater than what any man made derivative or credit swap can produce. It’s truly powerful. It’s Mother Nature’s bank yielding plenty.
As a sovereign nation, the President or Congress can create “The Bank of the Greater United States” collateralized by “seed money” with the stroke of a pen and a few thousand newly employed people to manage, help plant, and harvest the grain.
Currently the National debt is $12 Trillion. $220 TRILLION in 2016 could be enough to pay off the ever-increasing debt. (If not plant more seeds!) The new incoming President in 2017 would inherit a debt free country! Now that is a totally NEW ECONOMIC IDEA!
All the current President has to do is plant one seed today….
BUT WHY WAIT….If the President doesn’t PLANT IT….what about YOU? You could plant one seed of rice to yield plenty and create real value for yourself and others. On a massive scale the world population would prosper!
For more info contact David at 617-964-2951 or davidsnieckus@hotmail.com
David Snieckus
99 Crescent Street
Newton, MA 02466
617-964-2951
davidsnieckus@hotmail.com
http://www.davidsnieckus.com
The math:
Plant 1 seed in the garden in the first year you will harvest 214 grains
Plant 214 grains in the second year you will harvest 45,796 grains.
Plant 45, 796 seeds in the third year and you will harvest 9,800,344 grains
Plant 9,800,344 in the fourth year and you will harvest 2,097,273,618 grains
Plant 2,097,273,618 in the fifth year and harvest 448,816,553,824 grains
Plant 448,816,553,824 in the sixth year & harvest 96,046,742,518,33 grains
Plant 96,046,742,518,336 in the 7th year = 20,554,002,898,923,904 grains
Plant 20,554,002,898,923,904 in year 8 = 4,398,556,620,369,714,700 grains
So at the end of the President’s eighth year in office there will be:
· 4 quintillion,
· 398 quadrillion,
· 556 trillion,
· 620 billion,
· 369 million, 714 thousand and 700 hundred grains.
Now divide that by 20,000 (number of grains per pound) and you have:
The math is 4,398,556,620,369,714,700 divided by 20,000 equals 219,927,831,018,485.
So at about a $1.00 per pound (in 2017), the grain will yield 219 trillion, 927 billion, 831 million, 18 thousand, 485 dollars. I rounded it off to $220 trillion.
(My Calculations show that in the eighth year, only 3 million acres would need to be planted)…Hell there are 171,904, 640 acres in Texas!
· $220 TRILLION could be enough to pay off the debt with a bit of pocket change for implementation AND give the incoming President in 2018 a debt free country. If not plant more seeds!
To begin, all the President has to do is plant one seed today. OR
You could to yield plenty and ultimate prosperity to be shared around the world.
Contact me at 617-964-2951 or davidsnieckus@hotmail.com and we will work out the details.
June 12, 2009 at 7:03 pm |
[...] I said in an earlier blog post, Eventually, it may be possible to act effectively at the governmental level, but only after the [...]
May 8, 2009 at 2:23 pm |
Abolishing the Fed is a pointless exercise. If history is any indication (more on that later), the Fed would be back in one form or another. I like what Michael Rozeff proposes in his “Monetary Freedom” article:
http://lewrockwell.com/rozeff/rozeff296.html
I support his view that we need legal structure that gives citizens the freedom to use currency that suits their business and needs and then let the free market (competition) weed out the fakes.
Understandably, there is a lot of resentment wrt the Fed these day. Ironically, nobody complained for the last 30 years when the USA and Europe benefited greatly from the Fed’s ponzi scheme which extracted fruits of labor from developing countries and left them with confetti (T-Bills, FRN). Now when it is obvious that the gravy train for the western middle class is about to crash and the top layer (bankers, purveyors) of the ponzi scheme are about to walk away with all the riches, we finally see the scheme for what it is and don’t like it.
Abolishing the Fed will accomplish nothing for one simple reason: nobody really understands how the banking works, for whose benefit and what to replace it with.
The banking industry is the best example of darwinism we have in the corporate world – the ability to compete, survive and reproduce. From an academic point of view, it is a great case to study and learn from.
The present form of central banking was started (not invented) in Europe. The business was established by the Rothshields in Frankfurt about 250 yrs ago:
http://www.rothschild.info/history/
They started small, just like any other business i.e. Microsoft, developed a concept, perfected this concept and slowly expanded their franchise (just like McDonalds) into other countries where they secured exclusive rights, licenses and distribution channels from the national government. Basically, in their modest beginnings, they did what goldsmiths used to do – issued paper notes backed by gold or silver, or so they claimed.
Anyway, this business model was later exported into USA (and most of the World) which after a few set-backs succeeded in the form of the Fed. When stripped of all the hoop-la, the Fed is nothing more than a glorified
printing house. Since the Fed has exclusive rights, copyright and license to
distribute FRN, they wield considerable level of influence but not as much as most think they do. And soon the Fed will have even less power and influence.
Abolishing the Fed will be just symbolic as Obama already signed off on the creation of an international regulatory “authority” at the G20 meeting. And who is this “authority” ? It is the same authority that will manufacture fiat currency for the World:
http://www.globalresearch.ca/index.php?context=va&aid=13239
or (http://tinyurl.com/ddmtww) if above doesn’t work.
Anyway, in spite of all the criticism from the citizenry, the Fed, being a private and independent corporation, has to, first and foremost, as any other business would, look after the interest of their private equity holders first and then see how their goals and interests jive with the needs of their customers (nation/tax-payers).
While the Fed’s private stake-holders are US banks, the Fed answers to headquarters in London where the Rothshields, Loeb et. al. coordinate and implement their global printing strategy.
In my opinion, the entire global central banking business is largely misunderstood for lack of information (the above holding company is a private group; thus, don’t need to file public statements re their holdings and performance) or general interest.
In essence, global central banking business is just like any other business employing all the tools of well run companies. It is all about product, market penetration, product promotion, marketing, education, testimonials, distribution, advertising, management, etc. and most importantly PR to manage public perception regarding the perceived value of their product by numbering of what is essentially confetti of minuscule value. Or more so, the value of synthetic credit which are just digital bits in computer files.
While the general perception of central banking is finance, the core business is printing and reproduction. The general product are paper notes the size around 7cm x 16cm customized and localized, i.e. product differentiation by language and images recognized by local markets (nations). The product penetration strategy is based on obtaining an exclusive license to print and distribute notes in targeted markets.
For example, the Fed’s product, FRN, are promoted and advertised by the USGov’t and the distribution channel used are private banks. The local printing houses (Fed) are also responsible for protecting their markets, intellectual property rights, the product’s good image, quality and perception of confidence and durability. As a part of the FRN advertising, the printing houses also rely heavily on promotion of FRNs via education and testimonials of university lecturers who publish advertising brochures in the form of research papers on topics such velocity, liquidity traps, ratios, etc.
Anyway, there is probably no need to go into the entire product and marketing strategy of central banking. The point is that central banking business is not given enough recognition in the study of well run global conglomerates. The fact that Rothshields et. al. built a monopoly on printing fiat currencies in their respective markets over the last 250 years is an example of business strategy well planned and executed.
To continue and expand on that thought, I think every businessman and/or corporation strives to compete, conquer and eliminate competitors and become a monopoly that controls its markets. There is nothing unnatural about that process. And it is ‘natural’ for the monopoly to be depicted, by its customers, as sinister (which is the term most authors use in their articles), evil, conspiratory, taking over the World, etc. We don’t have to look too far for examples, i.e. that evil Bill Gates and Microsoft taking over the entire World with his Windows to seize control of digital information and enslave all of us in his grip to control our minds and communication.
The fact that Rothshield et. al. had enough business acumen to turn a private bank headquartered in London into a global monopoly on the manufacture of fiat currency is admirable. Central banks, i.e. Federal Reserve, in each country are Rothshield’s local manufacturing (printing) facilities whose products (dollars, euros, kronas, etc.) are freely traded in forex markets.
The success of Rothshield business model should be an exemplary business case study in every reputable business and economics university as that is one, if not ‘the’ most successful conglomerate in human history. Rothshield had firmly established his vision for his company, goals, plans, ideology, long term strategy and mission.
Strictly from a business point of view, the House of Rothshield used a superb penetration strategy to built a successful printing business spanning the entire globe with printing facilities/subsidiaries in every country except the likes of Iran, North Korea, Cuba, etc.(soon to be conquered into submission just like Iraq anyway) and eliminated competition, most notably gold and local government’s ability to issue their own currency. Hats off to German ingenuity. They (Rothshield & Co.) have been around for over 250 years with this business. Is there any other global business that has been around that long? Aside from religion/church? It is a classic business case to be analyzed and admired for its success.
Sure the Rothshields used questionable and unethical means to achieve their goals; however, as is said “It’s nothing personal, just business”.
Needless to say, Gates w/ Microsoft wasn’t exactly the poster boy for ethical business practices once Microsoft attained enough size and momentum. And it would have gotten a lot worse had Microsoft not been tamed in time.
Of course, as any monopoly, it (Fed) suffers from inertia and problems but overall they (Fed) have done tremendous job managing PR to get this far, for so long and benefit themselves that much.
The present criticism of the Fed is valid as it put interests and strategy of the conglomerate run out of London ahead of interests of their customers (nations/taxpayers). Also, it is not clear whether the Fed “screwed up” or if this crisis was intentional. The history shows that in every banking panic, the power and influence of the central printing house was increased, not diminished. The present “crisis” may be just a part of a greater plan to consolidate the global printing business and streamline their product line, i.e. as Europe consolidated many paper notes under one product, the Euro. There is already talk about regional currencies, global currencies (link above) etc.
This current discontent with the Fed may result that some individual states are allowed to secede (most notably Vermont) due to this financial crisis but God help them should they attempt to use their own currency, let alone gold/silver coins.
What is really unfortunate is that instead of Rothshield banking monopoly being admired, he/the company is depicted as an evil conspirator with sinister goals and intentions, i.e.:
http://iamthewitness.com/DarylBradfordSmith_Bankers.htm
as that is a huge dis-service to all of us.
April 12, 2009 at 8:11 pm |
BUY BACK ALL OUTSTANDING GOVERNMENT BONDS WITH GOVERNMENT PRINTED MONEY. CAUSE THE FRACTIONAL RESERVE SYSTEM OF BANKING TO BE CHANGED TO A 100% RESERVE SYSTEM. END THE FEDERAL RESERVE NOW!
February 18, 2009 at 1:01 am |
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