By William A. Cook
Last month, Stuart Jeffries writing in the Guardian, observed, 'Capitalism is in crisis across the globe – but what on earth is the alternative?' In 1840, Orestes Brownson in his essay 'The Laboring Classes,' asked the same question, '…what shall government do? … Its first doing must be an undoing. … We want first the legislation which shall free the government, whether State of Federal, from the control of the Banks. … a banking system like ours, if sustained, necessarily and inevitably becomes the real and efficient government of the country.” How ironic that 172 years ago, only 49 years after the adoption of the Bill of Rights, Brownson notes, “… at the end of ten years (of) constant hostility, (we know) all too well the power of the Banks, and their fatal influence on the political action of the community.” He declares further that “uncompromising hostility” against the banking system should be the motto of every working man, and of “every friend of humanity.”
Brownson’s “Laboring Classes” is a call to action, virtually at the inception of the country, to put the control of the government back in the hands of the people. “The system must be destroyed….The system is at war with the rights and interest of labor, and it must go.” How ironic Jeffries’ observation of the current state of affairs when contrasted to that of Brownson.
“Today, 164 years after Marx and Engels wrote about grave-diggers, the truth is almost the exact opposite. The proletariat, far from burying capitalism, are keeping it on life support. Overworked, underpaid workers ostensibly liberated by the largest socialist revolution in history (China's) are driven to the brink of suicide to keep those in the west playing with their iPads. Chinese money bankrolls an otherwise bankrupt America.”
Brownson not only understood where the power existed, he knew all too well the consequences to the people and the country if they were to rise against the forces of privilege. “On this point there must be no misgiving, no subterfuge, no palliation.” To bring down the banks means that “Every friend of the system must be marked as an enemy to his race, to his country and especially to the laborer. No matter who he is, in what party he is found, or what name he hears, he is, (in) our judgments, no true democrat, as he can be no true Christian.” Today, Brownson would no doubt have understood that the class warfare caused by the industrial revolutions in the UK and the US has not disappeared; indeed, it might be said that the past decades of “de-industrialization” in America, the shipping of America’s industries to foreign countries, has resulted in the Barons of Industry out maneuvering the workers, depleting their numbers, savaging their unions and destroying the middle class.
Three days ago PressTV contacted me as a possible participant in a new show that concentrates on finances. “Below is the topic of our talk, I really think it is for you.” The email noted these points of focus: Securitization, asset-based economy & fractional reserve banking (creating money out of nothing); Banks and US Politics: how the big banks purchase favorable legislation and influence politics; The Federal Reserve System (what it is and how it operates + the shady behind-the-scene deals and practices); the Jewish domination of the US & European banking system; from the German Jews and the Rothschild Banking family to the current near monopoly of modern Jewish dominance; the subprime mortgage crisis, bankruptcy and bailing out of the “too-big-to-fail” banks and the failure/collusion of the rating agencies; the Shadow Banking System and non-bank banks/institutions and their role in the current great recession; Monetary and fiscal policies (quantitative easing/printing money) and related macro/micro-economic effects and side-effects including inflation, accumulation of debt and deficit …
I declined. While I appreciated the opportunity to talk about Wall Street, my real interest in economics is not what Wall Street is doing and why, but why Wall Street exists at all. My concerns go back to the founding documents of the US and indeed those of any country that claims to be the securer of its citizens’ rights. Wall Street is a beast created by bankers, private bankers using the money that belongs rightfully to the people of the country. The economic system of any truly democratic state should serve the state so it can be responsive to its citizens, that system I have called “Nationomics,” a non-profit system serving the citizens not profiteers.
Only a country can create currency for its people as stipulated in its constitution unless the peoples’ representatives have given that right to private banks that are based on profit and usury; that is the case in the United States when the Congress created the Federal Reserve System in 1913. In effect Congress gave the American citizens rights and their tax dollars to those who borrow from the Federal Reserve while these private bankers make enormous profits through interest (usury) and the issuance of money they do not hold in reserve for which they charge interest, all backed by the taxes of the people of America. Thus are the people of the United States and their children held hostage to a corrupt system.
People's rights demand that the state protect them, keep the nation secure, provide for the health ("right to life" which means health) of its citizens and their common good. Yet the opposite is true in the west; the Bank of England, like the Federal Reserve Bank in the US is owned by a private family/corporation like Rockefellers/Rothchilds. Even the gold reserve in Britain is owned by these banks and, not to be outdone, the newly minted United States in 1791, chartered the Bank of the United States, almost 100 years after the Crown chartered the Bank of England, a privately owned corporation with the US government holding but 20 % of the shares.
Consider that these banks borrow money from the Federal government, paying a paltry percent for that favor, then loan that money out to citizens and entrepreneurs et al at generally exorbitant interest rates ranging from 5/6 % to 30%; indeed they set the rates and they benefit from inside knowledge to gouge the governments' of the money they received, the Taxpayers money. “The super-rich are currently hiding away wealth estimated between $21 trillion and $32 trillion in tax havens such as Switzerland and the Cayman Islands,” according to Ernst Wolff, who also notes “In 2005, the estimated offshore assets of the super-rich amounted to $11.5 trillion. Since then this total has doubled or tripled. Today the top 10 percent of the world’s population control 84 percent of assets, while the bottom 50 percent have access to just 1 percent. According to the study, the top of the pile—92,000 people who constitute an infinitesimal fraction of the world’s population—have hidden financial assets amounting to more than 9 trillion dollars, an average of nearly $100 million apiece” (Ernst Wolff, 7/26/12). These hidden assets would eliminate roughly three quarters of America’s estimated debt.
Consider as well that the major corporations benefiting from the largesse of the Federal Reserve System also stash away their profits to avoid paying taxes to the very Congress that must raise the debt ceiling every year to keep the budget afloat. “According to Henry, the world’s 10 largest private financial institutions, including Deutsche Bank, moved more than $6.25 trillion offshore in 2010” (Ernst Wolff). Perhaps of even more interest to the beleaguered tax payer is the ability of the favored wealthy, even in underdeveloped countries to which the taxpayers money has gone in the form of loans, to hide their money thus denying its use for vital services to their fellow citizens. “In the past 40 years the wealthiest citizens from 139 developing countries hid away non-declared assets estimated at $7.3 trillion to $9.3 trillion in tax havens. Their offshore assets are often greater than the national debt of their respective countries and play a major role in the lack of money to finance urgently needed public health and education programs in their home countries” (Ernst Wolff).
That's usury plain and simple; we are just beginning to understand how criminal and greedy this system is as the LIBOR debacle demonstrates. Note how merciless this system is simply because they are accountable to no one. When a citizen fails to pay the mortgage because the value of the house collapses to its true market value, the banks don't readjust to the market, they foreclose on a house that they mortgaged at high rates and then gamble on the failure of their actions knowing how risky their ventures were. And since they have access to our representatives through campaign contributions to both parties, in affect buying our representatives, they determine how the taxpayers dollars are distributed in a vain attempt to right a ponzi scheme they designed.
By contrast a national bank working with state banks could provide the dollars for the states to function at low rates knowing that all they needed to cover non-profit costs would be the value of the services being covered. No trading on phony mortgage schemes, no destroying of another nation through exorbitant interest rates that get higher and higher as the country goes into default through "austerity" measures that need not exist, followed by Wall Street vultures in buses seeking ways to capitalize on their economic chaos while the people are unemployed and desperate. Take the usury out of banking and the profit schemes used to create wealth without creating anything but phony paper, and tax money could be used to put people to work knowing that whatever they earned would be recycled into the nation’s economy, items bought, jobs created. Give it to the bankers and it leaves the US for the Cayman Islands; nothing offered to replenish the coffers of the taxpayers.
The solution is to abandon the banks and let them slide into oblivion, into the slime they represent. Since the only money they can demand belongs to the citizens, they have no money to use should their existence be denied. What power they have has been given to them by corrupt politicians; they too should be thrown out. The government has responsibilities to its citizens first and to the economic system as it serves that goal. The bankers can demand what they want but without the currency of the state available to them, they must resort to the courts and to the people that pay them, the taxpayers.
Abraham Lincoln, in a time of crisis, financed the Civil War by issuing United States Notes without interest; we are in a time of crisis, we too could issue notes and cease functioning with the Federal Reserve System, indeed, pay them off with such notes, and return the control of our economic system to the government.
How ironic that banking built on the premise of the Federal Reserve depends on a guarantee of payment based on taxes, a socialist system at its core--true socialism at its finest! No one speaks about this insidious parasitic system that bleeds the taxpayer to keep its profits flowing. Ironically, as the Barons joyfully moved their industries out of America to capitalize on wage-slaves in underdeveloped countries, they drained America of its middle class that can no longer continue the flow of taxes since their jobs have been cut, close to 15 million unemployed these past five years, and the Congress must raise the debt ceiling and borrow more billions to pay the bankers who demand their payback even as they concoct schemes like derivatives to milk the failed system they created.
And this brings us back to Orestes Brownson as he longed to see the America of 1840 attack the Barons and Bankers; the rich, he noted, will never voluntarily acquiesce to equality of income or parity of living, since “we know too much of human nature to believe that it will ever be effected peaceably. It will be effected only by the strong arm of physical force. It will come, if it ever come at all, only at the conclusion of war, the like of which the world as yet has never witnessed, and from which, however inevitable it may seem to the eye of philosophy, the heart of Humanity recoils with horror.”
Can anyone doubt that Capitalism is a failed economic system? How many times must it fail for people to accept that fact? Yet our press and our representatives and our schools keep a thundering drum beat of regurgitation to keep it afloat when its very existence has been made possible by taxpayer buyouts of their failed policies. But, like Ayn Rand, one needs to keep living and pushing to that objectivistic end, self-gratification at any price, even if it means living off the dole. How utterly ironic.
- William A. Cook is a Professor of English at the University of La Verne in southern California. His works include Psalms for the 21st Century, Mellon Poetry Press, Tracking Deception: Bush Mid-East Policy, The Rape of Palestine, The Chronicles of Nefaria, and most recently in 2010, The Plight of the Palestinians. He contributed this article to PalestineChronicle.com. Contact him at: firstname.lastname@example.org or visit: www.drwilliamacook.com.