Saturday, February 21, 2009

g.h.kirsch: Banking & Revolution

It is difficult to appreciate the momentousness of the moment at hand as the struggle to resolve matters swirling in the banking sector come to the critical pass. The debate over nationalization of our largest, but failing, banks portends a watershed event, a sea change in our economic lives. Perhaps even the culmination of the Revolution of 1776.

Since that revolution freed us from English political rule, the financial chains have remained more difficult to throw off.

In his autobiography, Benjamin Franklin wrote, “The colonies would gladly have borne the little tax on tea and other matters had it not been that England took away from the colonies their money, which created unemployment and dissatisfaction. The inability of the colonists to get power to issue their own money permanently out of the hands of George III and the international bankers was the PRIME reason for the Revolutionary War."

Mayer Amschel Rothschild in Frankfurt, agent of and banker to Prince William was an influential member of this international banking cartel. He had inherited his father's business, which at the time afforded him the ability to collect interest from those they extended credit. Then, and to this day, lenders did not have more than a fraction of the amount they lent in reserve. Their notes, promises to redeem the same for gold or silver, circulated in the community for the purpose of exchange.

This was known as “fractional reserve banking.” It in fact allows for the creation of money from thin air. In the US today, banks still are only required to have a ten percent reserve. Banking is profitable because if they charge borrowers five percent on a hundred dollar loan, the five dollars they receive in interest is actually a fifty percent return on their own principal. And when the money on deposit is yours and mine, that profit is only diminished by the small percentage we receive..

Rothschild quickly discovered that loaning money to governments and royalty was far more profitable than loaning to individuals, as the loans are bigger and are secured by the nation's taxes. He immediately set out to monopolize this area of finance. In 1769 he was given permission to hang a sign on the front of his business premises declaring it to be, "M. A. Rothschild, by appointment court factor to his serene highness, Prince William of Hanau."

Some years later, in 1790, well on the way to his goal, Rothschild would boast, "Let me issue and control a nation's money and I care not who writes the laws." Not many years later the Rothschilds would gain control of the Bank of England and Nathan Mayer Rothschild would declare, "I care not what puppet is placed upon the throne of England to rule the Empire on which the sun never sets. The man who controls Britain's money supply controls the British Empire, and I control the British money supply."

The bank had been established in 1694 as a central bank with the franchise to issue notes, legal tender for most of the nation. As such private individuals were granted the right to create money and lend it to the government and banks, and collect interest from individual borrowers and from the government, which collected taxes from the citizenry.

While visiting The Bank of England in 1763 Franklin was asked how he accounted for the prosperity in the colonies. He replied, “That is simple. In the colonies we issue our own money. It is called Colonial Script. We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers. In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay to anyone."

The colonists understood the people's confidence in the currency was all that was needed, and they could be free of borrowing debts. Which meant they were free of the Bank of England. In response the world's most powerful independent bank had the British parliament pass the Currency Act of 1764 making it illegal for the colonies to print their own money.

Shortly thereafter, Franklin wrote, "In one year, the conditions were so reversed that the era of prosperity ended, and a depression set in, to such an extent that the streets of the Colonies were filled with unemployed."

Following the Revolution, political philosophy for the new nation was split between those who favored instituting a monarchical system that shared power with the economic aristocracy, and the proponents of democracy. The former were led by Alexander Hamilton who had been an aide to General Washington, was involved in financing the army with numerous London bankers, including the Rothschilds, and had become the first Secretary of the Treasury. The latter were represented by Paine, Jefferson, Madison, Burr and Franklin.

A critical disagreement amongst these men concerned the creation of a central bank for the new country, Hamilton being its proponent, and Jefferson and Madison its most outspoken opponents.

Madison once wrote, "History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance."

In 1784 Hamilton organized The Bank of New York with capitalization of $500,000 promised from undisclosed investors. In fact it was quietly chartered and underwritten by The Bank of England which had also secretly financed the revolutionaries to strengthen its grip on Britain's finances as well as put the colonies in its debt. The Bank of New York is the oldest bank in the US.

During the debates at the Constitutional Convention in Philadelphia Hamilton argued for a central bank to be controlled by private interests. Jefferson, Madison and others prevailed however and the power to create money was reserved to Congress.

But the bankers did not give up, and a bill was proposed by Hamilton to the first session of the first congress in 1790 to make the Bank of New York a central bank in the image of The Bank of England to be known as the First Bank of the United States. Jefferson spoke against the bill, pointing out, “The incorporation of a bank, and the powers assumed by this bill, have not, in my opinion, been delegated to the United States by the Constitution.” Jefferson argued that powers not specifically granted the federal government were reserved to the states.

But on February 25, 1791 Hamilton's camp prevailed and began to handle the financial needs and requirements of the central government of the newly formed nation. The charter was for 20 years.

Seven years later, as the national debt began to grow and as taxes taken from Americans were discovered to be again flowing to the Bank of England, Jefferson lamented, “I wish it were possible to obtain a single amendment to our Constitution taking from the federal government their power of borrowing."

But the bank's charter was rescinded in 1811, due to its association with the Bank of England, tight monetary policies, and competition with state chartered banks. Some accused it of corruption, but it survived and continued to operate independently again as the Bank of New York.

As a result, the House of Rothschild lost millions. This enraged Nathan Mayer Rothschild who threatened, "Either the application for renewal of the charter is granted, or the United States will find itself involved in a most disastrous war." When the Charter still was not renewed, he convinced the British Parliament to, "Teach those impudent Americans a lesson. Bring them back to colonial status." So started the War of 1812.

Commentators and critics of the international banking cartel often accuse the cartel of manipulating money supplies to create panics and financial crises to retain their control; and fomenting wars and revolutions in order to create government borrowing. It has been said that the Rothschilds have financed both sides of every war since the American Revolution. In any case, shortly after the Bank of England was cut off, Britain and America were again at war.

The upshot of the War of 1812 was even Madison, now President, was forced to accept the formation of The Second Bank of the United States. It too was underwritten and controlled by the Bank of England which by now was firmly under the control of the House of Rothschild. The predominant reason for the bank was severe inflation caused by the war and difficulty in financing military operations. The credit and borrowing status of the United States with international bankers was at its lowest level since its founding, largely thanks to the influence of Rothschild.

The Second Bank of the United State's charter came up for renewal in 1836. The economy was difficult, credit was tight and the bank was extremely unpopular. Partisan politics during the Jacksonian period was a big part of the debate over renewal of the charter. It was a classic conflict between wealthy Whigs and working class Democrats.
President Jackson said, "If the American people only understood the rank injustice of our money and banking system - there would be a revolution before morning."

At the end of January, 1835, Jackson was almost assassinated by Richard Lawrence. Luckily for the President, both of the assassins guns misfired before “Old Hickory” charged with his cane, drove him to the ground, and stomped him quite violently. Recovering, Lawrence claimed that with the President dead “money would be more plentiful,” referring to Jackson’s struggle with the Bank of the United States, and that he “could not rise until the President fell.”

Jackson told the nation, “The Bank is trying to kill me - but I will kill it!” Later when asked what was the greatest achievement of his career, without hesitation he replied , "I killed the bank!"

But he didn't kill the desire of the cartel, now dominated by the Rothschilds and their agents, to subdue the Untied States. The next attempt led to the Civil War as the banking cartel offered financing to southern states in the hope of creating ever greater competition between two significantly different economies.

As the earlier article in this series described, Old Abe outmaneuvered the bankers while he survived. He printed the "greenback."

In 1881 President Garfield articulated his grasp of where the source of the country's problems lay. "Whosoever controls the volume of money in any country is absolute master of all industry and commerce. And when you realise that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate."

A few weeks after releasing this statement Garfield was assassinated.

At the end of the nineteenth century the bankers were working very hard to regain their franchise to draw on the tax base of the US. In the early 1900's this effort was led by William Rockefeller (a relative of the Rothschilds), Senator Nelson Aldrich, his father-in-law, and J.P. Morgan. Some credit these Wall Street bankers with orchestrating the financial crisis of 1907.

Anticipating the pay off from years of careful scheming, Nathaniel Meyer Rothschild, speaking to a group of international bankers in 1912, echoed his father and grandfather.

"The few who could understand the system (checks, money, credits) will either be so interested in its profits, or so dependent on its favours, that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests."

And how right he was. In a series of well guarded moves organized by Morgan's people with the help of the Rockefeller family, the Wall Street banks and the international cartel represented by Paul Warburg, direct from Frankfurt, were already collaborating to draft legislation to create a new central bank.

Aldrich was later able to sneak the bill through by keeping the US Senate in session with two other senators on Christmas eve, and the three of them passed the Federal Reserve Act by a unanimous vote. When Morgan's estate was settled after his death, it turned out he only owned ten percent of J.P. Morgan & Co. Guess who owned the rest.

The bankers had Woodrow Wilson to sign their legislation. Wilson had promised to sign in return for their support in the election. The bankers had convinced Teddy Roosevelt to make a third party run, thereby splitting the conservatives, defeating the progressive Republican, trust busting William Howard Taft, and electing the Democrat Wilson.

In 1913, with the passage of the Federal Reserve Act, Hamilton's Bank of New York, underwritten by Rothschild's Bank of England, again became the controlling bank of America's central banking scheme, the Federal Reserve System, which was not federal and had no reserves. Jefferson spun in his grave.

Three years later, Wilson would acknowledge, "I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world, no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men."

And so we've come through numerous wars, assassinations, financial panics, recessions and depressions to the present. There have been other runs at the bankers. JFK authorized the Secretary of the Treasury to issue Silver Certificates that competed with Federal Reserve Notes. Some four billion dollars worth of the certificates were put into the money supply, backed by the silver holdings of the American people, creating a direct threat to the Federal Reserve's monopoly on the creation of money.

But immediately after Kennedy's assassination, printing ceased and the certificates were removed from circulation.

During the recent election CNN reported pseudo Democrat, Lady Lynn Forester de Rothschild was backing John McCain because, "Barack Obama is an elitist."

Lady Rothschild splits her time between a New York penthouse and an English country estate.

"It’s a wonderful life," she says, "and that is why I want John McCain and Sarah Palin in the White House so other people can have that wonderful life. Ronald Reagan might have said it right – the Democratic Party left me, I didn’t leave the Democratic Party. I’m going to stay a Democrat.”

So there you have it. The view from the House of Rothschild.

These simple words of Paine return to me. "A long habit of not thinking a thing wrong gives it a superficial appearance of being right."

Watch your back Barack.

Now, maybe a reluctance to nationalize the banks, and end the international banking cartel's grip on the country, the treasury and the economy is more understandable. "Just follow the money." Indeed, the presidencies of those who have opposed them have often been short lived.

To do so would not be a step towards socialism as proponents of passing these banks' losses off on taxpayers would have us believe. Frankly it's time to recognize these people can't be expected to restrain their unrepentant greed. The time has come to assert our right as a nation to control our money supply as the Constitution envisioned; a freedom for which patriots, presidents and citizen soldiers have fought and died.

"He that stands now, deserves the love and thanks of man and woman. Tyranny, like hell, is not easily conquered; yet we have this consolation with us, that the harder the conflict, the more glorious the triumph." Tom Paine