How much power does the Federal Reserve really have? Wright Patman, a foe of the System and longtime Chairman of the House Banking and Currency Committee commented that "we have in effect two governments. . . .We have the duly constituted Government . . .Then we have an independent, uncontrolled and uncoordinated government in the Federal Reserve System, operating the money powers which are reserved to Congress by the Constitution. The Federal Reserve neither requires nor seeks the approval of any branch of government for its policies. The System itself decides at what ends its policies are aimed and then takes whatever actions it sees fit to reach those ends."
These actions by the Fed have resulted in alternate periods of inflation and deflation in which the American people have been whipsawed while insiders of international banking make enormous profits and exercise more and more control over our government and the economy. Congressman Charles Lindbergh, father of the famous aviator, was correct when he warned during debates of the Federal Reserve Act that now "depressions will be scientifically created."
By controlling the money supply and interest rates the Fed is able to create inflation or deflation, recession or boom, and send the stock market and the value of our dollar up or down at whim. Enormous profits were made by those who were privy to Fed policy and got out of the stock market in the summer of 1929. By 1933, the Dow Jones had shrunk 95 percent and real bargains were available for those with cash. The game worked so well it has been repeated at regular intervals.
To what extent has the Federal Reserve been used to loot our monetary system? Congressman Ron Paul reports that since creation of the Federal Reserve in 1913 the U.S. dollar has lost over 90 percent of its purchasing power. Certainly this has not happened by accident.
Central banking is an absolute necessity for dictatorial control over a nation. And while socialism may be crumbling in the Soviet Union - it's doing very well in the United States, thank you. Indeed, the fifth plank of the Communist Manifesto calls for: "Centralization of credit in the hands ofthe state, by means of a national bank with state capital and an exclusive monopoly." This same endeavor of creating money by you or I is called counterfeiting.
The Federal Reserve Act enabled the bankers to put the government deeply in debt to themselves. Between the Declaration of Independence and the creation of the Fed in 1913, the National Debt had been run up to a little over a billion dollars. Now, using the Federal Reserve, our Debt stands at over four trillion dollars. The yearly interest on that Debt, a large part of which is paid to the banks, is a mind-boggling $45 billion a day! And this figure is ballooning rapidly as our politicians refuse to balance the Budgetand continue to insist on bigger and bigger deficits. The difference between what the politicians grab in taxes and their generosity in spending our hard-earned money is made up by borrowing, and the Federal Reserve obligingly spins off the deficit through the Open Market Committee sale of the Debt.
Without the Fed to monetize the Debt, the Congress would as a practical matter be forced to reduce deficit spending and fund the Budget. The Federal Reserve in collusion with Congress are pulling us down the road to socialism and economic destruction. The central banking system, foisted on this country in 1913 under the guise of preventing panics such as the one that occurred in 1907, is the engine carrying the load.
While historians agree that it was the Panic of 1907 that demonstrated the "need" for a central bank, they overlook the fact that J.P. Morgan intentionally started it by spreading rumors that the Knickerbocker Bank and the Trust Company of America were insolvent. Believing the rumors, the public began a run on the banks - and the rumors came true.
In response to that Morgan-instituted panic, Congress set up a National Monetary Commission to study central banking. A group of 16 Congressmen, under the leadership of Senator Nelson Aldrich (David Rockefeller's maternal grandfather), spent two years royally dining their way across Europe discussing centralized banking. They returned to the United States and in 1910 met secretly at Jekyll Island, Georgia, to brief representatives of the big banking interests. Paul Warburg, a German financier and partner in the banking firm of Kuhn, Loeb & Company, handled the planning for the banking insiders setting up the Federal Reserve System.
Although plans for the Federal Reserve were presented by Warburg and agreed upon at that secret Jekyll Island meeting, it was not until the elections of1912 that the powerful bankers were in a position to foist centralized banking on the country. A previous attempt in 1909 by Senator Nelson Aldrich, known as "Morgan's floor broker in the Senate," had failed to pass a Democrat-controlled Congress and only served to call public attention to the machinations of the international bankers.
But by backing Teddy Roosevelt on the Bull Moose ticket the Rockefeller-Morgan interests were able to pull away enough votes from William Howard Taft, the Republican Presidential candidate, to elect their man Woodrow Wilson.
With Wilson in the Presidency, the Aldrich bill was resubmitted as the Glass bill. Wilson and his alter ego, the Morgan agent Edward Mandell House, pressured Democrats to pass the Glass bill, disguised as a measure to strip Wall Street of its power, in the name of party unity. Meanwhile, the banking insiders put up a smokescreen of opposition and were aided in their deception by proponents of the original Aldrich measure. The scheme worked. The Federal Reserve Act was passed on December 22, 1913, and the insiders of international banking were in control of our nation's economy. While these bankers created a perpetual Santa Claus for themselves, Christmas for most Americans has never been quite as merry as it once had been.
For Americans to recapture control over their economic destiny, abolition of the politically-manipulated Federal Reserve is the sensible solution. Balanced Budget Amendments, and other Constitutional tinkering are only obfuscations designed to prolong our agony.