Tag Archives: money power

Can governments and banks be trusted with the money power?

As governments around the world struggle to manage their soaring debt burdens, the wisdom of E. C. Riegel rings ever more true. The masters of the political debt-money regime are pressuring Cyprus to confiscate part of the savings of their citizens, and Greece and other countries to impose budgetary cuts that burden the poor and middle class. Argentina wants to grab their people’s savings by nationalizing their pension funds. All the while, the purchasing power of national currencies shrinks as governments inflate them to enable deficit spending.

Riegel’s call for monetary freedom must no longer be ignored. –t.h.g.   


[by E. C. Riegel, written circa 1940s]

Old Liberty Bell rang out the political freedom that we cherish. But unless we learn how to make freedom ring the cash register, bureaucracy will ring down the curtain on our liberties.

What is the strange power that makes the government at Washington grow stronger and our state and local governments grow weaker while the people suffer the torment of war and the travail of insecurity and the shadow of dictatorship falls across the land? It is the same power that oppresses the people of all the world — the political money power.

The political money power is the power of national governments to buy the people’s sweat and blood with scraps of paper – paper that falls like a blotter upon our production and our freedom. Each day our

wealth diminishes and more of our liberties vanish. Inflation that threatens to bring chaos is just around the corner. As our sons bleed and our mothers weep, the same grinding power throws its pall over other lands.  Yet our chains are paper – paper money that, through our ignorance, binds us to the treadmill of our own destruction.

We can be masters of our destiny; we are all powerful, if we but realize it. In each of us resides the power to assure liberty, prosperity, security and peace. In each of us lies the money power, which, when springing from us, is democratic and virtuous; when springing from government is authoritarian and vicious. As we liberate our inherent money power we curb the political money power, for the more we use our self-created money, the less we need political money. Thus we defeat dictatorship. Thus we reconstruct the shattered world on a free democratic basis. Thus we save civilization.

Parchment freedoms are but taunts and mockeries without money freedom. A people dependent upon their government for money is a subject people regardless of the form of their government. No people can declare their independence and govern their government unless they assert their money freedom. A government that is not dependent upon its people for money supply is a tyranny regardless of its professions. Government must be made to beg the people for money; the people cannot be sovereign while petitioning government for money. The citizen must command both government and business through his money power. Political democracy is a delusion without economic democracy and economic democracy can function only through the power to issue money – the power to ring the cash register – the power to support and the power to withhold support. To prevent political dictatorship the citizen must himself be a dictator. To prevent centralization of power, power must be reserved by the people. Money power is sovereignty; without it democracy is impossible.

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From Money Freedom, organ of The Private Enterprise Money Movement.

More monetary wisdom from E. C. Riegel, including his book, Private Enterprise Money, can be found at http://www.newapproachtofreedom.info/, and via my website http://beyondmoney.net/.

– Thomas H. Greco, Jr.

Who’s Left, who’s Right, and who should issue money?

I have in my possession, a copy of a copy of an essay by E. C. Riegel, one of many that I gleaned from the files of Spencer MacCallum who had the foresight to rescue Riegel’s literary legacy from oblivion, and the good sense to make his insightful works on money and freedom generally available. The article titled, The Right Is Still To Come, is transcribed below. It bears no date, but I would guess that it was probably written sometime between 1945 and Riegel’s death in 1953.

In the very first paragraph, Riegel sets forth the essential target of his argument, saying, “The professed socialists and the professed anti-socialists are united as monetary socialists in the common superstition that money springs from the State.” I long ago took Riegel’s argument to heart and have taken up the cause of dispelling that superstition, most notably in Chapter 8, The Separation of Money and State, in my book, The End of Money and the Future of Civilization.

I personally try to avoid using imprecise terminology and political clichés that are emotionally charged and tend to get in the way of rational thinking. Riegel, on the other hand, can be forgiven for some slight indulgence in political rhetoric that seems to us perhaps judgmental and outdated.  Keep in mind that he lived in tumultuous times that were scarred by two world wars, the great depression, and the rise of totalitarian governments bearing the various labels of fascist, communist, or socialist (any critique of Capitalism in the west at that time was overwhelmed and suppressed in a number of ways). These are the terms that defined people’s loyalties, as nations contested violently with one another to decide how people should be governed. The reader should not be put off by Riegel’s framing his arguments in terms of left, right, socialist, capitalist, and collectivist. His writings clearly show that he was, after all, a champion of peace, freedom, and social justice.

The emphasis of particular sections in the following essay has been added by me to highlight major points.–t.h.g.


On the left stands the socialist, back of him stand a hundred capitalists.  All society is composed of conscious and unconscious socialists.  The professed socialists and the professed anti-socialists are united as monetary socialists in the common superstition that money springs from the State.  The birth of the Right awaits disillusionment from this all-confounding fallacy.

There are advocates of many different money reforms but none renounces the basic error of the socialization of the money system.  To none of the believers in free enterprise does it seem incongruous to leave the State in complete control of the medium whereby free enterprise must articulate.  The right to freely contract and the sanctity of contract is seen as cardinal to free enterprise.  Yet, to leave to the State the power to alter contracts by altering the meaning of the money unit in terms of which all contracts are expressed, does not seem to professed capitalists contradictory.  Thus the State exercises its most vicious interventionism by making itself a party to all contracts, an unbidden and perverting party.

Some would limit, by various devices, the amount of “money” the State should issue.  Others would limit the amount of “credit money” that business men should issue.  Still others would abolish the later entirely, counting only government issues as genuine money.  None would abolish so-called money issues by government, leaving the money issuing power to the only true issuers, the private enterprisers.

With monetary socialization accepted, the choice is confined to different methods of perversion.  There is no monetary Right and since free money is basic to a free economy, there is no philosophy of the Right.  To merely complain against the drift toward socialism does not make one a true anti-socialist.  To propose or support political money reforms does not make one’s surrender to socialization any less abject, nor betrayal of free enterprise less vicious.

The trend toward socialism was set when business men accepted the cry, better called superstition, that money issuance and control are functions of political government—the political money system.  That fallacy, until exploded, makes the progressive socialization of the entire economy inevitable.  The pace of this perversion is not determined by the amount of resistance offered by the alleged opponents of socialism, but by the degree that the State indulges its perversive power by emissions of false money into the blood stream of business.

The pace of this perversion is quickening all over the world; a huge flood of water-money threatens to inundate all.  Can we preclude disaster by bringing those who call themselves anti-socialists over from the Left to the yet unoccupied Right?  Can we induce businessmen to think and act in terms of the economic means rather than the political means?  Can we build an economic statesmanship?  In short, can we sell capitalism to capitalists?  If we can we will save private enterprise and the social order.  If not, the deluge.

Painful as it may be to change habits of thought, (if indeed, prevailing money ideas can be called the product of thought) the triumph of free enterprise over socialism and tyranny can be accomplished only by the renunciation of the fallacy of political money power and the assertion of exclusive power of private enterprise to control and issue money.  When we realize that the political money system has operated almost from the beginning of money, it may be seen what a break with tradition this proposal involves.

The long existence of the political money system does not, however, imply continuity of operation or vindication.  There have been countless instances of the breakdown of national money units through excessive dilution of the money stream by the State.  All money circulations have been a mixture of genuine money issued by private enterprisers and spurious issues by the State.  Following these breakdowns the State set up new money units and repudiated the old.  During the transition from the old to the new, exchange has been kept alive by resort to other national units that were still relatively stable.

What makes the present inflationary crisis unprecedented is the universality of the decline of political money units and that the U.S. dollar, the strongest unit, is being subjected to blood transfusion to sustain other units.  Thus the superstructure of the entire political money system is being bolstered by timbers taken from the foundation with the ultimate result that the whole structure will collapse together.  It is therefore imperative that we change superstitious money ideas for rational ones before it is too late to avoid worldwide chaos.

Why no State Can Issue Money

To understand money is to understand why it cannot spring from any government, national, state or city.

The purpose of money is to obviate the necessity for contemporary delivery of value by both parties to an exchange transaction and thus greatly expand exchange.

By means of money its issuer is enabled to purchase values from any supplier, who, in turn, is enabled to do likewise, the money ultimately reaching a supplier who has need of the issuer’s values and thus the reciprocating trader is found and exchange is completed and the money retired.  Account is balanced by passage of value both ways, the medium, money, having no value.

Money can be issued only by a buyer who later, as seller, redeems his issue.  He must, to stay in business, bid for money with value because that is his only way of gaining income. He must price his values competitively or he can make no sale.  Thus, by his circumstance of being a private enterpriser he is ideally suited to issue and redeem money.

Contrast the State’s situation.  It is not a trader; it does not sell.  It needs not bid for money; it merely requisitions it by taxation. Since it has no way of redeeming money by open competitive bidding, it cannot issue it and its professed money issues are inescapably spurious.

The power and need to issue money is inherent in private enterprisers and thus it operates under natural checks and balances, while to the State it is entirely unnecessary and unnatural and no amount of fixing can supply the requisites that it lacks, nor is there the slightest reason for undertaking such artificiality.  The State would never have gotten into its present unnatural position of its own necessities, for, it always had its taxing power, before the advent of money, to levy in kind and under money exchange to levy on money.  It was forced into its anomalous position by the ignorance of businessmen who, not understanding money resorted to the superstitious belief that it needed the State’s imprimatur.

In spite of all the abortiveness of the political money experience professed friends of private enterprise and self-styled anti-socialists continue their efforts to perpetuate it by added gadgets.  None has contributed in the slightest degree toward liberating private enterprise from it.  Private enterprisers do not even know that, as bank borrower they are money issuers.  They think that their participation in the money system is a secondary one and that even this depends upon a grant from the State.  The truth is that every money unit ever issued has come from private enterprisers and that no money has ever or ever can be issued by any state.  The only thing that makes it possible for the delusive political money system to operate at all is that the true money issued by businessmen serves as a host for the parasite issues of government to feed upon.  No government could build a money circulation of itself anymore than a farmer can produce watered milk from the pump alone.  In this metaphor government is the pump and private business is the cow.

How the political Money System Sabotages Private Enterprise

Every businessman knows that stock splits involve an increase in the number of shares without an increase in capital.  What he does not understand is that so-called money issues by government are but money splits involving merely an increase in the number of units without an increase in the money supply.  The analogy ends there.  In stock splits the corporation does not rob the stock holder.  In the process of money splits the government issues them by taking goods and services out of the market, thus robbing the economy, thereby depreciating the power of each money unit.  This is called inflation and inflation is in turn defined, naively, as “too much money chasing too few goods”, whereas it is but the same amount of real money mixed with spurious money with the economy robbed in the sum of the spurious money.

With the so-called capitalist world deluded into thinking that what government issues is money, the process of sabotaging the economy has open sesame.  It enables the State to practice paternalism and paternalism is the mother of socialism.

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E. C. Riegel’s Money Quiz and the True Money System

How many people in the world really understand money—its essence, its purpose, its proper management, its potential either to free us or enslave us? Sadly the number is close to nil as Riegel discovered decades ago, an opinion that was shared by renowned monetary economist Irving Fisher of Yale University. According to Riegel, Prof. Fisher, in a public speech “indicated that most persons who undertook to discuss money did not understand the subject and that those ‘who understood the real meaning of money’ were very few.” That was sometime in the mid-1930s, but it seems that the same situation still prevails today.

A little later, Riegel wrote a letter asking Fisher to specify whom those few might be, to which Fisher responded with a list of ten names, along with the caveat that the list was by no means exhaustive, and that there were probably several other of which he (Fisher) was unaware.

Next, Riegel, under the banner of the Consumer Guild of America, prepared a questionnaire which he sent out to the ten “experts” that Fisher had named. Riegel then published, in 1935, the results of his survey in a book titled, The Meaning of Money. I’m not aware of the existence of any digital file of that book, but there are a few bound volumes and photocopies still available.

My intention here is not to review or summarize that book, but simply to provide some background showing Riegel’s diligent research of the subject and to set the stage for presenting some of his eventual conclusions.

Riegel died in 1953, but part of the vast legacy he left behind is a one page document that bears the heading, Are These Propositions Correct? This document bears no date, but was probably written late in his life, and seems to be a concise summary of what he discovered and came to believe as result of his many decades of research and cogitation in the areas of money and the exchange process. I have transcribed that document, and present it below for your consideration.

Are These Propositions Correct?

  1. Money is a means of facilitating trade by splitting transactions in halves, giving the buyer value and the seller a claim for equivalent value upon any one or more traders in the community of traders.
  2. The issuance of money arises out of a purchase and sale transaction requiring tender and acceptance. Therefore, it is a bi-lateral function that can be exerted only by a buyer and a seller and there can be no money issue on behalf of another. Therefore governments cannot issue money on behalf of their constituency.
  3. Implicit in the act of issue is the agreement of the issuer (in common with all others in the trading community) to accept the issue in exchange for value when tendered. Therefore, only one who is prepared to accept money in exchange for value, when tendered, is qualified to be a money issuer and all persons so qualified to accept are ipso facto qualified to issue. Thus the power to issue is inherent in all traders.
  4. Money circulation is a cycle wherein the money passes from issuer to acceptor and from acceptor to acceptor until finally accepted by the issuer and thus retired. The money system is therefore a bookkeeping system whereunder money springs from a debit and is retired by an offsetting credit. The instrument evidencing the bookkeeping process need have no intrinsic value.
  5. Money is actually backed by the value surrendered by the seller and potentially backed by the value in possession of the next seller. Therefore, all “reserves” such as precious metals or other values are purely gratuitous and irrelevant.


If the above propositions are correct, we must conclude that a true money system, not only may, but must be established as an integral part of the private enterprise system and the issuing power must be denied to all except private enterprisers, the exclusion to include all governments and non-profit institutions. The true money system must be based upon voluntary cooperation of the participants. Therefore no legislative or political action is required. Therefore, without political sponsorship or boundaries, the true money system is potentially universal and uniting all traders with one monetary language.

Sometimes Riegel’s statements require clarification and elaboration, which I have done in some of my own writings, and there are a (very) few points on which I disagree. But Riegel has given us here a clear view into the simple essence of money and the true nature of the exchange process, providing the material we need for building a solid foundation upon which economic democracy can be erected. –t.h.g.

Who Owns You?-Debt Bondage and the Structure of Financial Empire

Here is the first segment of a video series that provides an excellent description of our current predicament and the system that dominates our lives. The series contains 6 lessons divided into 12 segments and pretty well explains many of the points that I’ve been trying get across about the money system and the power structure. It dispels the myth that ours is a government by the people and for the people. In reality, we, and all our governmental entities are in a state of debt bondage. Who are we in bondage to? Watch it and find out.

The author’s solutions, which are presented in Lesson 6, are well intended and in the right direction, but he seems to have a mistaken notion that sovereignty resides in the national government. I take issue with his advocacy of the “greenback solution” (http://beyondmoney.net/resource-links/take-back-the-money-power/), but aside from that, I’m in close agreement with everything he says.

This series takes about 2 hours to watch, but if you don’t have time to watch it all, or if you are already somewhat knowledgeable about these matters you should watch at least Lessons 1 and 6.

I’ve added a link to Renaissance 2.0 under Recommended Sites.

I hope everyone will watch this series and spread the word to your networks.–t.h.g.

P.S. And if you can stand coarse language and the bitter truth, watch George Carlin explain it.

Government By Goldman Sachs

Reporter Matt Taibbi recently wrote an article for Rolling Stone called The Great American Bubble Machine. In this five part video he elaborates upon the theme and describes how Goldman Sachs has virtually taken over the U.S. government. Watch it.

More Drum Beats for a Single Global Currency and a Global Central Bank

The global financial and economic crisis continues to deepen. Bankruptcies, unemployment, and home foreclosures are up, while incomes from wages, interest on savings, and investments are being squeezed. At the same time the money supply is being inflated by deficit spending to finance massive bank bailouts. A major increase in the cost of living will eventually follow.

The bankers and politicians who caused the problem in the first place are asking the people to trust them and accept more of the same medicine. Their plea is essentially this: “Give us more power, give us more money, and let us further centralize an already over-centralized system.” A global central bank and an eventual single global currency are what they have in mind.

A recent article by Paul Joseph Watson pretty clearly lays it out.