Posts Tagged ‘Von Mises’

Will America’s Corrupt Banks Realign Politics Again?

 :: Posted by Limited Government on 05-21-2013

Will America’s Bank War Again Realign Politics?

It can be said that the present day financial crisis and the broad and sweeping powers the U.S. Federal Reserve has assumed in its wake all share their origins in the very first debates Congress had over the creation of the national debt, the Fed’s precursor, the Bank of the United States, and over the implication of foreign ownership of these institutions.

With an economy addicted to credit expansion and a $16.7 trillion national debt set to rise rapidly in the coming years, and interest owed on the debt, much of it to foreigners, poised to eventually overwhelm taxpayers’ ability to repay it, these debates are no less vital today.

They can be instructive to the American people in deciding whether to continue on the path of increasing debt and dependency on foreign sources of credit and printed money to refinance our obligations.

The First Bank

When the first U.S. Treasury Secretary Alexander Hamilton’s Bank of the United States — the nation’s first central bank — came up for renewal in 1811, these very controversies caused Congress to allow its charter to lapse.

President James Madison had never supported the bank’s charter in 1791 as a member of the House of Representatives, along with Thomas Jefferson, who both had opposed the bank on constitutional grounds. In 1811, Madison had his vice president, George Clinton, cast the deciding vote against the bank’s renewal.

The fight over Hamilton’s bank back in 1791 in many ways had led to the advent of political parties in the United States. The Federalists, led by Hamilton, were in favor of the bank, and the Republicans, led by Madison and Jefferson, were against.

Of considerable concern at the time was the foreign ownership of the bank. In debate over the bank’s renewal, Sen. Henry Clay revealed that “seven-tenths [70 percent] of the stock belonged to British subjects, and that certain English noblemen, and a late Lord Chancellor, were among the very largest of the stockholders,” as noted in an 1830 House report on the bank’s history prepared by Rep. George McDuffie for the Andrew Jackson Administration.

As a result of the objections, the bank’s 1811 renewal was defeated — but not for long.

Madison’s Transformation

Within a year, the U.S. was again at war with Great Britain, a conflict that put the nation deeply into debt. Madison, who had famously opposed the creation of the national debt, when in power saw it rise from $45 million in 1812 to $127 million by 1816 to pay for his war.

Per the House report, within three years “the circulating medium became so disordered, the public finances so deranged, and the public credit so impaired, that the enlightened patriot, [Alexander] Dallas, who then presided over the Treasury Department, with the sanction of Mr. Madison, and, as it is believed, every member of the cabinet, recommended to Congress the establishment of a National Bank.”

Quite the turnaround. Opposition to the bank had been an article of faith for Jefferson and Madison’s Republican Party, but then in 1816, Madison signed into law the bill that created the Second Bank of the United States.

Similarly, Jefferson’s renowned opposition to the national debt had suddenly become forgotten when he took office in 1801, going deeply in debt with Baring Brothers & Co. (then Francis Baring and Company) of London to finance the 1803 Louisiana Purchase from Napoleonic France.

The Rise of ‘Old Hickory’

These apostasies led directly to the rise of Andrew Jackson and the splintering of the American political party system, once again over the bank issue and the debt.

It is a sinister joke that Andrew Jackson appears on the 20-dollar Federal Reserve Note, an institution he would have despised. Whoever came up with that idea must have had quite a laugh over the irony. As President, Jackson paid off the national debt and when the renewal of the Second Bank’s charter passed Congress, he vetoed it. The Jacksonians became the basis for the modern day Democrat Party. Those in favor of the national bank became the Whigs.

Besides the arguments against its constitutionality, assisting Jackson was again the specter of foreign ownership of the bank, which was his principal objection. In 1822, foreigners held $3.1 million or 9.1 percent of the bank’s $35 million capital, according to a report of its board of directors. In 1830, according to McDuffie’s report, that figure had risen to some $7 million, or 20 percent of the stock.

By 1832, that figure had again increased to $8.4 million, or 24 percent of the stock, “mostly of Great Britain,” Jackson noted in his veto of the bank’s recharter. Foreign ownership of the bank was indeed rising, quite rapidly. Even though foreigners were barred from serving on the central bank’s board of directors, Jackson perceived ownership as a threat to American sovereignty and independence, and the central bank was again shuttered.

“Should the stock of the bank principally pass into the hands of the subjects of a foreign country, and we should unfortunately become involved in a war with that country, what would be our condition?” Jackson asked, tacitly referring to the financial ruin that followed Madison’s war. Nearly reaching bankruptcy, the War of 1812 revealed what happens when a nation finds itself at war with its creditors.

Overall, the Republicans under Jefferson and Madison had accumulated a mountain of debt to foreign countries during their administrations. Their experiences changed their views and hence public policy about everything from the national debt to central banking, supporting Jackson’s essential point that foreign “investment” is actually influence, and can turn into subversion. When Madison could not secure financing for his ruinous war (even after it was over), he yielded into the pressure to create another central bank in 1816.

16 years later, Jackson would undo it, but the issues of currency, debt, and central banking would not go away forever.

The Revenge of the Fed

Although Jackson’s slaying what was called the central banking hydra liberated the American economy for the duration of the Civil War and the Industrial Revolution, advocates of a national bank and the power to engage in rapid credit expansion would eventually succeed, with formation of the Federal Reserve 100 years ago in 1913 under the guise of preventing bank panics.

Yes, there had been bank panics in the interim, but these did not stop the industrialization of the U.S. economy or the settling of the West. Nor did they lead to anything like what followed.

After all, the creation of the Fed did not stop bank panics. It worsened their severity as is readily evidenced by both the Great Depression and financial crisis of 2007 and 2008. Both crises followed massive credit expansions that were financed by the central bank.

Now, looking at where the Federal Reserve has brought us over the past century, with politicians as diverse as former Rep. Ron Paul (R-TX) and Sen. Bernie Sanders (I-VT) uniting around the issue of Fed transparency in the 2010 Dodd-Frank legislation, it appears that the most recent financial crisis has opened another salvo in the nation’s ongoing Bank War.

Foreign Influence — again

The Fed audit revealed that of the $1.25 trillion of mortgage-backed securities the central bank purchased after the housing bubble popped, some $442.7 billion were bought from foreign banks. These were not loans, but outright purchases, a direct bailout of foreign firms that had bet poorly on U.S. housing.

They included $127.5 billion given to MBS Credit Suisse (Switzerland), $117.8 billion to Deutsche Bank (Germany), $63.1 billion to Barclays Capital (UK), $55.5 billion to UBS Securities (Switzerland), $27 billion to BNP Paribas (France), $24.4 billion to the Royal Bank of Scotland (UK), and $22.2 billion to Nomura Securities (Japan). Another $4.2 billion was given to the Royal Bank of Canada, and $917 million to Mizuho Securities(Japan).

At the time of the bailouts, then-Sen. Jim DeMint (R-SC) supposed in an interview with radio host Mark Levin that foreign creditors threatened to stop lending the U.S. money unless we bought back the mortgage paper.

The whole episode vindicated the fears of Andrew Jackson, who essentially warned that a central bank and a government in debt to foreigners would first serve their interests before that of citizens. So, while Americans were suffering through high unemployment and resultant foreclosures on their homes, foreign banks were made whole with a printing press.

Jackson was proven right. Foreign ownership of U.S. debt in 2008 again had again changed public policy in favor of those interests.

No Other Way

All the while, the people are told that there is no alternative. That we must have a central bank that privatizes profits when times are good, and socializes losses when the banks screw up and extend credit too far. That the economy would fall apart without such an institution.

These were the same exact arguments that were put to Jackson when he questioned the central bank. The1830 McDuffie House report warned Jackson ominously, “it would be utterly impossible to produce so entire a change in the monetary system of the country, as to abolish the agency of banks of discount, usually attendant on great political revolutions, subverting the titles of private property.”

The report added, “The sudden withdrawal of some hundred millions of bank credit, would be equivalent, in its effects, to the arbitrary and despotic transfer of the property of one portion of the community to another.”

Yet without a central bank, none of those things happened. Instead, 1870 to 1913 is seen by many to have been a renaissance for the American economy.  In fact, between 1836 and 1913, although there were bank panics, there were no economic crises of the magnitude seen in 1929, 1931, or 2008 when central banks had complete control over monetary policy.

The New Bank War

The bank war has been the fault line of American history. It has led to two of the three shakeups of the party system that have occurred over the past 224 years. It is no mistake that the same issue that divided the party of Jefferson and Madison in 1816 and 1832 divides both Democrats and Republicans today.

With the rise of the Tea Party on the right and Occupy Wall Street on the left in the U.S., or of the UK Independence Party in Britain, or of the Five-Star Movement in Italy and Syriza in Greece, one common thread tying these disparate political movements together is opposition to bank bailouts and the current regime of central banking.

When leftists and libertarians begin finding common ground on an issue as important as money, something is happening. This movement may be in its nascent stages, but it is sending shockwaves through the current political system all over the world.

The political success of central banking over the past century — all opposition had been nearly wiped out — means that when economic contractions brought on by excessive credit expansion occur, as it has today, there are no other institutions to blame for the misery that follows.

Central banks have had their time, but now the pendulum is swinging once again. Where it ends is anyone’s guess, perhaps a Rand Paul candidacy, but as in the past, this issue has the potency to transform and realign American politics.

Bill Wilson is the President of Americans for Limited Government. Robert Romano is the Senior Editor of Americans for Limited Government

January 4th, 2013

  • Share/Bookmark

The Astonishing Ron Paul

 :: Posted by Limited Government on 12-23-2012

As 2012 draws to a close, it’s hard not to be reminded that 2013 will begin with Ron Paul retired from Congress. For all those years he was a fearless truth-teller, who exposed and denounced the horrors, domestic or foreign, of the regime. His farewell address – something practically unheard of for a congressman in the first place – will continue to be read years from now, as future Americans look back with astonishment that such a man actually served in the US Congress.

For most of his career, those speeches were delivered to a largely empty chamber and to audiences of modest size around the country. A man of Ron’s intelligence could have grown in stature and influence in no time at all had he been willing to play the game. He wasn’t. And he was perfectly at peace with the result: although he wasn’t a major political celebrity, he had done his moral duty.

Little did he know that those thankless years of pointing out the State’s lies and refusing to be absorbed into the Blob would in fact make him a hero one day. To see Ron speaking to many thousands of cheering kids, when all the while respectable opinion had been warning them to stay far away from this dangerous man, is more gratifying and encouraging than I can say. I was especially thrilled when a tempestuous Ron, responding to the Establishment’s description of his campaign as “dangerous,” said, you’re darn right – I am dangerous, to them.


Some people used to tell Ron that if only he’d stop talking about foreign policy he might win more supporters. He knew it was all nonsense. Foreign policy was the issue that made Ron into a phenomenon. There would have been no Ron Paul movement in the first place had Ron not distinguished himself from the pack by refusing to accept the cartoonish narrative, peddled not only by Rudy Giuliani but also by the luminaries of both major political parties, accounting for the origins of 9/11.

How many bills did he pass, right-wing scoffers demand to know. A successful Republican politician, in between his usual activity of expanding government power, is supposed to have rearranged the deck chairs on the Titanic five or six times, by means of bills with his name on them. At best, the bills these politicos boast about amounted to marginal changes of momentary significance, if even that. More commonly, even the bills they trumpeted turned out to be ambiguous or actually negative from a libertarian standpoint.

What is Ron’s legacy? Not some phony bill, of zero significance in the general avalanche of statism. For his legacy, look around you.

The Federal Reserve, an issue not discussed in American politics in a hundred years, is under greater scrutiny now than ever before. Austrian economics is enjoying a rebirth that dwarfs the attention it received when F.A. Hayek won the Nobel Prize in 1974 – and when you ask people how they heard about the Austrian School, the universal answer is Ron Paul. One man brought about this intellectual revolution. How’s that for a legacy?


And that’s not to mention how many people Ron introduced to libertarian thought in general, or how many hawks reconsidered their position on war because of Ron’s arguments and example.

Even the mainstream media has to acknowledge the existence of a whole new category of thinker: one that is antiwar, anti-Fed, anti-police state, and pro-market. The libertarian view is even on the map of those who despise it. That, too, is Ron’s doing.

Young people are reading major treatises in economics and philosophy because Ron Paul recommended them. Who else in public life can come close to saying that?

How many bills did he get passed? Talk about missing the point.

Where are the hordes of students dying to learn from Herman Cain, Michele Bachmann, Rick Santorum, Newt Gingrich, Tim Pawlenty, or Mitt Romney?

Remember, too, that in politics there’s always some excuse for why the message of liberty can’t be delivered. I have to satisfy the party leadership. I have to keep the media off my back. The moment is inopportune. My constituents aren’t ready to hear it – so instead of explaining myself and persuading them, I’ll just keep my mouth shut, or minimize my position to the point where I sound like any old politician, except ten percent better.

And all the while, would-be donors are assured that this is all a facade, that the politician is really one of us and not what he appears to be. For the time being, you understand, he has to contradict his core beliefs in order to ingratiate himself into the favor of those whose support he will one day need.

Once elected, he still cannot really say what he thinks. Don’t you want him to get re-elected?


Ron never acted this way. At times he would explain the libertarian position in ways likely to resonate with a particular audience, but he never compromised or backed away.

It’s been said that if you ask Ron Paul a question, he gives you a straight answer. That’s an understatement. All through his presidential campaigns he sent the guardians of opinion into hysterics. Why, he can’t say that! That wasn’t even one of the choices! To the gatekeepers’ astonishment, his numbers kept on growing.

No politician is going to trick the public into embracing liberty, even if liberty were his true goal and not just a word he uses in fundraising letters. For liberty to advance, a critical mass of the public has to understand and support it. That doesn’t have to mean a majority, or even anywhere near it. But some baseline of support has to exist.

That is why Ron Paul’s work is so important and so lasting.

Ten years from now, no one will remember the men who opposed Ron in the GOP primaries. Half of them are forgotten already. But fifty years from now (and longer), young kids will still be learning from Ron: reading his books, following his recommendations for further study, and taking inspiration from his courage and principle.

With Ron’s Congressional career drawing to a close, we should remember that we have witnessed something highly unusual, and exceedingly unlikely to be repeated. And we should also remember Ron’s parting advice: the real revolution is not in Washington, DC. It’s in the world of ideas.

That’s what Ron is devoting the rest of his life to, and it’s one more thing he has to teach us. So watch for news of his institutionalized work for peace, his homeschooling curriculum, his homepage, and his TV network. Far from retiring, Ron Paul is stepping up his work for liberty. And in this work, there is a place for all of us.

December 21, 2012
By Llewellyn H. Rockwell, Jr. –

  • Share/Bookmark

The Great Man That Ron Paul Is…

 :: Posted by Limited Government on 12-21-2012
Ron Paul is WND’s ‘Man of the Decade’

Champion of the Constitution, Sound Money & Liberty Like No Other

RON PAUL EXPOSED!!! This Video Exposes The Great Man That Ron Paul Is & Always Has Been.  

  • Share/Bookmark

The Declaration of Independence 2.0

 :: Posted by Limited Government on 12-04-2012

The Globalist Federal Government Seceded From America

Independence is not a dirty word.

Self-determination is not a dirty word.

Freedom is not a dirty word.

“Our country has already been taken over. I want to secede back to the Republic, back to our nation. The new world order has taken over. We’re not fighting just some corrupt politicians and it’s a little political issue. We have serious, hardcore authoritarians, Ron Paul called them yesterday authoritarian psychopaths, in control. We know what tyranny is historically. This is the worst case of it I’ve ever seen. And it’s growing and coming to fruition very, very quickly.” – Alex Jones, “Talk Show Host Calls For Second American Revolution!” November 15, 2012.

“As over a million Americans express their disenfranchisement with the federal government by supporting a secessionist movement that has spread like wildfire, it is time to call for a new declaration of independence and a new commitment to restore the Republic in the face of an enemy that has subverted America from within.” – Paul Joseph Watson, “Ron Paul: The Founders Believed in Secession,” November 15, 2012.

“We are going to force the issue with the globalists, because here’s the key. We’re not seceding from the federal government. We are recognizing and declaring what is self-evident that the federal government has been hijacked by foreign banking cartels.” – Alex Jones, “TRANSCRIPT: Alex Jones – Secede from the New World Order,” November 15, 2012.

Since when did self-determination become a dirty word? Isn’t this the slogan that America fights for abroad? Why, then, does the U.S. government deny this principle at home? Why is the federal government more interested in the self-determination of Iraqis, Afghans, and Syrians than of Americans?

A government that denies its own basic principles and laws does not deserve to be listened to and followed. Secession from such a poisonous government is a moral and spiritual duty.

Alex Jones is on the right side of history by calling for secession from the bankster-hijacked federal government. He is standing up for America and for freedom-loving people worldwide.

The current oligarchical owners of the U.S. government forfeited their claim to rule the American people when they murdered three thousand innocent Americans on September 11, 2001, and then proceeded to destroy the laws and freedoms of the United States by hyping the fake terrorist threat. They seceded from America on that day. The rightful response is to secede from these savages, counterfeiters, aggressors, and liars.

Secession is not an act of treason, it is one of many peaceful political solutions to problems that have been long in the making. The states can rebuilt the American economy by seceding from the corrupt federal reserve system that stole the federal government from the American people in 1913. They should create their own currencies and issue their own credit to their citizens and businesses since the federal reserve and federal government aren’t doing it.

The federal government can honestly fix economic injustices by either abolishing the corrupt federal reserve system or nationalizing it and reclaiming the right to issue money from the transnational private banking cartel. If this does not happen, then the states have a right and a responsibility to their citizens to secede from a collapsing and morally bankrupt banking system.

The Dollar is dead. The era of private central banking is finished. Public banking is the future. Gold and silver is the future. Honest money is the future. If the federal government will not get on the right side of history then the states must.

If the question is asked, why secede? Give this answer: why obey? The hijacked federal government is proposing austerity and war. It is intellectually, morally, financially, spiritually, and politically bankrupt. Here is an excerpt from the Infowars article, “Why The States Must Secede To Save America”:

“While Americans are being told to brace for tax hikes, spending cuts and a myriad of other austerity measures, the Federal Reserve has been sending trillions of dollars to foreign banks.

The federal government is supposed to represent the states, but it doesn’t, it represents the interests of the political and banking elite who themselves have no allegiance whatsoever to America.”

The age of treason is not over, but there is a new age of global political awakening in which corrupt political leaders and international financial fraudsters are getting the biggest wake up call in history. Humanity wants to be free. The sick perverts who rule England, America, and other nations must step down from office and face the legal consequences of their actions.

The transition to a new age of freedom won’t be easy. But liberty must be fought for in every generation. In our time, the greatest freedom to be won is the freedom of the mind. Totalitarian ideologies such as political Islamism, Zionism, and Counter-Terrorism have deprived nations in the East and the West of this sacred freedom which is the source of all others.

As socially conscious and politically aware global citizens, it is our duty to destroy these totalitarian ideologies and liberate the individual from the prison of systematic government brainwashing. Our demand is clear: The brainwashing of all humans by all governments must end.

We are not mental subjects of governments, but creative children of God, and God has no official state ideology. Governments of the world must recognize this divine demand and stop using the media as a tool to instill propaganda into the minds of their citizens. That is the way of the past. It is a dead way. We live in a different time now, a time of spiritual evolution.

There are creative and peaceful remedies to government brainwashing and mass mind control. The global alternative media is the key to saving liberty because the free access to information is critical if we want to form our own opinions.

In his farewell speech in Congress, Dr. Ron Paul said, “The internet will provide the alternative to the government/media complex that controls the news and most political propaganda.” He also said that the growth in popularity of homeschooling will lead to new thinking, new ideas, and new reforms. Here is an excerpt from his speech:

It is self-evident that our freedoms have been severely limited and the apparent prosperity we still have, is nothing more than leftover wealth from a previous time. This fictitious wealth based on debt and benefits from a false trust in our currency and credit, will play havoc with our society when the bills come due. This means that the full consequence of our lost liberties is yet to be felt.

But that illusion is now ending. Reversing a downward spiral depends on accepting a new approach.

Expect the rapidly expanding homeschooling movement to play a significant role in the revolutionary reforms needed to build a free society with Constitutional protections. We cannot expect a Federal government controlled school system to provide the intellectual ammunition to combat the dangerous growth of government that threatens our liberties.

Government schools are about indoctrination, and “sheep-herding,” as the genius and poet Ezra Pound described it.

Totalitarian governments treat the mass of people as sheep to be brainwashed, robbed, and slaughtered.

The history of the totalitarian states in Nazi Germany and the Soviet Union proved that totalitarianism is the death of the soul and the annihilation of the individual.

Individuals in America have a moral and spiritual duty to mentally secede from a war-possessed totalitarian government that is only interested in enslaving, killing, robbing, lying, spying, and cheating. It is the right and honourable course. I stand with them, and with all humans who want to mentally and spiritually secede from oppressive governments.

“Reboot the Republic. . .Reinstall the Declaration of Independence.” – Alex Jones.

November 15, 2012
Posted by Saman Mohammadiat 11:59 PM

  • Share/Bookmark

FAIR USE NOTICE: This web site may contain copyrighted material. Such material is made available for educational purposes only. This constitutes a 'fair use' of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law.