| Subject: | Re: [socialcredit] Richard C. Cook: Monetary Crank | | Date: | Tuesday, September 2, 2008 16:32:55 (-0600) | | From: | Martin Hattersley <jmartinh @....ca>
|
| In reply to: | Message 5504 (written by william_b_ryan) |
Hi, Bill
Just with respect to one part of your criticism of Cook - the condemnation
of usury, defined as a charge for the loan of money, in contradistinction to
a rental charge for the loan of property to be returned later to the lender
(baliment), was condemned by Pope Benedict XIV in his encyclical "Vix
Pervenit" around 1745.
I'm at present translating a commentary on that encyclical dating from that
period by a father Concina, strongly critical of Calvin and his followers,
and it certainly indicates the strength of the passions involved. Attached
is a short article I recently wrote on the subject.. I can forward the
translation, as far as it has got, if you are interested.
Martin Hattersley, 5929-189 St.,
EDMONTON AB CANADA T6M 2J1
Phone (780) 483-5442
e-mail <jmartinh@shaw.ca>
----- Original Message -----
From: <william_b_ryan@yahoo.com>
To: <socialcredit@elistas.com>
Cc: <rickycook21@hotmail.com>; <ami@taconic.net>
Sent: Tuesday, September 02, 2008 9:42 AM
Subject: [socialcredit] Richard C. Cook: Monetary Crank
Appended below is Richard Cook's recent Internet posting. It is a great
disappointment to me in many respects. Gone is even the pretense of Social
Credit theory. It is heavily influenced by Stephen Zarlenga, a Georgist who
argues that Henry George was a Greenbacker!
The A + B theorem is replaced by the fallacious "debt virus" theory that we
have discussed previously. The "usury" argument is an Islamic
fundamentalist slam against modern informed Christianity, which we have also
discussed previously, so I'll just briefly outline the arguments now.
In Zarlenga's "American Monetary Act" is a provision for a so-called
"citizens' dividend." Says Cook: "The Act also includes a provision for a
citizens’ dividend, similar in some respects to the Alaska Permanent Fund,
which would inject desperately needed purchasing power into the economy
without additional government debt or taxation."
Lest anyone think that this "citizens' dividend" is similar to the Social
Credit proposal for a dividend, read this from the act itself, as posted on
Zarlenga's website:
"SEC. 506 INITIAL MONETARY DIVIDEND TO CITIZENS Not later than 90 days from
the effective date of this section, the Secretary, in cooperation with the
Monetary Authority shall provide recommendations to Congress for payment of
a Citizens Dividend as a tax-free grant to all U.S. citizens residing in the
U.S. in order to provide liquidity to the banking system at the commencement
of this act, before governmental infrastructure expenditures have had a
chance to work into circulation."
Please note that in Zarlenga's plan the dividend is not continuing, as in
Social Credit, but paid only once at the beginning of the plan's
implementation "before governmental infrastructure expenditures have had a
chance to work into circulation."
As to the "debt virus" argument, Cook quotes Bob Blain:
“Loans created only the principal. Interest had to be paid out of principal.
So payment of interest reduced the money supply and slowed economic
activity. Recovery could come only when new loans were taken out at least
equal to interest paid.”
The second sentence is simply a false statement of fact. Banks create
customer deposits not only through the principal of loans, but when they
spend, through reciprocal economic activity, salaries, wages, dividends and
ordinary business expenses into the community, which become available to pay
interest back to the banks.
As to the religious argument, I have as the authority John Calvin's letter
of 1545, as related by Norman Jones of Utah State University, that two quite
different words in the Semitic languages were inappropriately translated as
"usury" into the European languages.
http://www.geocities.com/new_economics/Calvin-usury.txt
This is supported in modern Islam.
http://www.geocities.com/new_economics/Quran-usury.txt
-------------------------------------------------------------
FAIR_USE_CLAIMED
Democrats in Denver Should Skip One of Their Parties & Read the American
Monetary Act
by Richard C. Cook
Aug. 27, 2008
How are things going at the Democratic Party National Convention in Denver
this week?
Are they talking about the fact that the Western world is run by an
international financial elite headquartered in London, the financial
capitals of mainland Europe (such as Frankfurt, Hamburg, Amsterdam, Paris,
and Milan), and, of course, New York City?
Are they mentioning at their cocktail parties that the financial elite exert
control over the world’s population through the cartels that make up the
world’s producing economies and through the civilian and military
bureaucracies who work for the governments that kow-tow to them?
Of course they know that the most important cartels are those which control
energy resources. And that of these, the commodity of central importance is
oil. But is any of this helping them draw conclusions regarding the doubling
of oil prices during the last year or about the largest oil company profits
in history?
Also, they should be drawing the right conclusions from the fact that every
private and pubic enterprise operates on the basis of a money economy,
though it would be more accurate to call it a credit economy. This means
that whoever controls the issuance of money and credit controls the world.
And the world’s monetary systems function on the basis of money and credit
being introduced into circulation through loans from the banking system,
loans for which interest is charged. So what should that tell them?
In fact, they should be pointing out to each other and their TV viewers that
the charging of interest for the use of money is a chain around the neck of
everyone on earth. Further, that these cumulative interest charges are built
into the price of every product that is manufactured or consumed. And that
growth of debt means price increases too.
They should be honest in making it clear that the world is a master-slave
society, that the slaves are those who borrow and pay interest, that the
masters are those who collect the interest, and that this unjust system has
existed in one form or another for thousands of years.
The candidates and delegates are talking about the aspirations of the
American people and how everyone should have an opportunity to achieve their
dreams. But if the United States were a free nation, they would also be
talking about a financial system that destroys people’s dreams.
Unfortunately, the highest rung the candidates and delegates have been able
to reach on the ladder of modern-day slavery is the need for more jobs—but
they fail to note that jobs are not only the means by which people live, but
also the instruments for them to pay the heavy burden of interest the
masters of finance require.
What they won’t say is that the world economy is based on usury, something
religions used to consider a crime (and which Islam still does). Usury is
the charging of interest for the use of money. As the religions backed off
from their prohibitions of interest, usury became just excess interest. But
that’s not what the word really means.
So what have over two centuries of usury done to the United States?
The best answer ever given to that question was contained in a paper
entitled “Revisiting U.S. Public and Private Debt” published in January 2005
by Dr. Bob Blain, Emeritus Professor of Sociology at Southern Illinois
University. The paper updated an earlier study by Dr. Blain published for
the United Nations Educational, Scientific, and Cultural Organization
(UNESCO) in the International Social Science Journal, November, 1987, Paris,
pages 577-591.
In his paper, Dr. Blain examined the growth of total public and private debt
in the U.S. Total debt includes “the debts of governments (federal, state,
and local), corporations, farmers, home mortgages, and consumer, commercial,
and financial debts.”
In his analysis, Dr. Blain began with data from the Bureau of Economic
Analyses of the United States Department of Commerce which covered the years
1916-1976. After that year the Bureau stopped publishing the data.
The figures showed that from 1916-1976, total U.S. debt grew from $82
billion to $3,800 billion ($3.8 trillion). But most of that growth was
during the last 21 years, from 1955-1976, when it began to grow
exponentially. Dr. Blain wrote, “The consistency of the pattern suggests
that some imperative is at work, something that requires debt to increase.”
Dr. Blain found the answer by researching American history. He wrote: “Then
I read G.R. Taylor’s 1950 book, Hamilton and the National Debt, which
described the debate over Alexander Hamilton’s plan to fund the new economy
with borrowed money.” He continued:
“The most revealing account was a speech by the first congressman from
Georgia, James Jackson, on February 9, 1790, in which he predicted that
adoption of Hamilton’s funding plan would lead to the explosive growth of
debt. Jackson said, ‘Though our present debt be but a few millions, in the
course of a single century it may be multiplied to an extent we dare not
think of.’” (Annals of Congress, Vol. I, February 1790, pp. 1141-2)
From the very beginning, the U.S. had a monetary system based on borrowing
and debt. First came the thousands of state chartered banks that began
operating late in the Revolutionary War period and continued in one form or
another until today. Then there were the two early central banks: the First
Bank of the United States (1791-1811) and the Second Bank of the United
States (1816-1836). Today’s national banking system began during the Civil
War with the National Banking Acts of 1863-64. Then there is the system we
are living under today, the Federal Reserve, chartered by Congress in 1913.
Even during the times when the government has sold its debt directly to the
public, as with war bonds, savings bonds, and Treasury notes and bills, that
too has been money borrowed at interest.
Although there have been times in history when money entered into
circulation other than through debt, such as with coinage and the Civil War
greenbacks, those were exceptions and today are of little importance.
Dr. Blain estimated that from the time Alexander Hamilton placed the U.S.
under a debt-based monetary system until today, the debt has compounded at
5.8 percent annually. The big problem with this system, he said, was “that
no money was created to pay interest.” He continued:
“Loans created only the principal. Interest had to be paid out of
principal. So payment of interest reduced the money supply and slowed
economic activity. Recovery could come only when new loans were taken out at
least equal to interest paid.”
Dr. Blain concluded, “As long as the money supply of a nation is created as
debt costing interest, debt must grow by compound interest.” From a
longer-range view, it’s a system that is constantly collapsing and that must
constantly be bailed out.
Dr. Blain next sought to update his figures past the 1976 data from the
Bureau of Economic Analyses. Turning to the Federal Reserve’s series on
“Total Credit Market Debt Outstanding,” he found remarkably similar
indicators.
He found that adding data from the Federal Reserve from 1945 to 2003 showed
the “debt explosion” continuing. In 1945 total debt was $463.4 billion. In
2003 it was $44,967.7 billion ($45.0 trillion). When he projected the debt
level for 2010, he arrived at a figure of $74.9 trillion. By this time the
debt curve was climbing so steeply there would be almost a doubling of the
amount of total debt in only nine years.
It might be argued that these figures do not take into account inflation.
This is because lending at interest is the cause of inflation. The dollars
still have to be repaid with interest. The problem occurs when economic
growth, measured by GDP, does not keep up.
Looking at the growth of GDP from 1945 to 2003, the increase was from $223.1
billion to $10,987.9 billion, a factor of 49. But the debt ($463.4 billion
vs. $44,967.7 billion) grew by a factor of 97, almost twice the rate of GDP
growth. Thus the total debt burden on the economy has doubled from a ratio
of 2:1 to more than 4:1 (though it was much less than that during the early
days of the nation).
But with continued compound growth of debt and a slow- or no-growth state of
the economy as we head into a recession, we are starting to see what Dr.
Blain called an “acceleration to meltdown.” He wrote:
“We are buying more and more in the same amount of time. Witness the
efforts of people to get rid of their excess through yard sales, storage
units, and big trash pickup days, and the massive size of what are
euphemistically called landfills. While two billion people in the world lack
basics such as clean water, food, and shelter, Americans throw away their
microwave ovens, televisions, computers, refrigerators, furniture, and cars.
Meanwhile, acceleration is applauded as increasing productivity. It’s like
arguing that cancer is good because it grows.”
These are the things the Democrats in Denver should be talking about,
instead of going to so many parties. They should be making note that the
U.S., to quote economists close to the Federal Reserve, is “functionally
bankrupt.”
In fact, the debt this nation owes to the banks, to foreign creditors, and
to each other can never be paid off. Further, one big reason for all of our
fruitless military endeavors overseas may simply be to escape unpleasant
economic realities at home. But this is pointless. Nothing creates more debt
than war, as the bankers have always known.
The only solution is to adopt a monetary system that is not based on debt.
Dr. Blain makes a couple of specific recommendations: 1) “Stop using
percentage rates to calculate charges for the use of money”; and 2)
“Congress must supply the economy with a money base that is debt-free and
interest-free.”
The second point is a call for a new monetary system, not one based solely
on lending by the banks or on government borrowing. One organization that
has developed a blueprint for such a system is the American Monetary
Institute (AMI), headquartered in Chicago. The director of the AMI is
Stephen Zarlenga, author of a massive, groundbreaking work: The Lost Science
of Money (AMI, 2002). Zarlenga’s assistant is Jamie Walton, a monetary
reformer from New Zealand.
AMI will be holding its fourth annual conference in Chicago on September
25-28. Expected as keynote speaker is Congressman Dennis Kucinich, whose
wife Elizabeth once worked as an intern at AMI. Dr. Bob Blain will be a
featured speaker.
On the AMI website at www.monetary.org is a remarkable document, the
American Monetary Act [.pdf] The product of several years of work by
Zarlenga and his network, which now includes a number of local chapters
around the country, the American Monetary Act would replace today’s
debt-based monetary system with one where the government spends or loans
money directly into circulation.
Under the Act, the Federal Reserve would be retained as a national financial
clearinghouse but would no longer be a bank of issue. The system would be
overseen by a Monetary Control Board within the U.S. Treasury Department.
The Act also includes a provision for a citizens’ dividend, similar in some
respects to the Alaska Permanent Fund, which would inject desperately needed
purchasing power into the economy without additional government debt or
taxation.
Also promoting a citizens’ dividend, by the way, is Stephen Shafarman in his
important new book, Peaceful, Positive Revolution. (Tendril Press, 2008)
It’s the American Monetary Act the candidates and delegates in Denver should
skip one of their parties to read, because it’s the only way any of their
hopes for America can ever be realized. Says AMI’s Jamie Walton:
“This is a crucial time. Things are happening. We have got some key
media people talking and writing about our kind of reforms. The inertia is
starting to yield. Things are starting to roll. The worsening conditions in
2009 will give us a once-in-a-lifetime chance to be heard above the
propaganda.”
-
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