Lies the government told you by Andrew Napolitano (big screen ebook reader .TXT) 📕

of stock in the Federal Reserve. A Chairman of the House Banking Committee (now known as the House Financial Services Committee) even once noted that whether the Federal Reserve worked with the government’s fiscal policy or chose another direction was based mainly on the Federal Reserve Chairman’s mood. Considering that the United States dollar is the currency of the world and the Federal Reserve controls the dollar, one could argue that the Chairman of the Federal Reserve is more powerful than the President. Money is power, and economic and political events around the world can be manipulated through U.S. monetary policy.

Not only is the word Federal in “Federal Reserve” a government lie, but so is the word Reserve. A reserve implies, and many people assume, that money is being stored away to use in a crisis, and that gold and other hard money are stored in order to ensure that all debts can be paid. This is not the case. Though original notes issued by the Federal Reserve stated, “This note is legal tender for all debts public and private, and is redeemable in lawful money at the United States treasury or at any Federal Reserve Bank,” this was changed by a 1963 amendment. At that time the Fed began to issue its first series of notes without the redemption promise, while taking notes with the redemption promise out of circulation.

The notes now read, “This note is legal tender for all debts public and private.” By removing the promise, “. . . and is redeemable in lawful money . . .” the Federal Reserve, with the support of the federal government, eliminated a constitutional monetary system and replaced it with paper and public debt.

Then, when some financial institutions attempted to privatize, the Monetary Control Act of 1980 granted to the Federal Reserve control of all national depository institutions, so that all financial institutions that offered deposits against which checks could be written were now under its control, whether or not they had ever been a part of the Federal Reserve System.14 Now the monopoly was also granted the ability to force cartelization on those who wanted to remain private.

The public debt continues to grow exponentially with no end in sight. While the cost to the Federal Reserve for printing a note of any denomination is four cents and the Federal Reserve prints money from air, it charges the federal government interest for the monetary loans. As well, the Federal Reserve earns interest on the government securities in its ownership. Therefore, the Federal Reserve makes money each time it prints money, and thus it is encouraged to print more money, no matter whether it has any gold to back it up.

The term “reserve” is highly fallacious. The Fed does not want to reserve or save; it wants to spend, because the more it spends, the more interest it makes. The only president to issue an Executive Order beginning the process of abolishing the Fed was President John F. Kennedy, and he was dead three weeks later. His Executive Order Number 11110 returned to the Treasury Department its constitutional authority “to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury.”15

Essentially, the President intended to give back to the federal government the ability to introduce currency backed by silver, without any need for a Federal Reserve. Each ounce of silver, at that time totaling about $4 billion in the government’s possession, could back the new currency. The effect on the Federal Reserve would have been that the new silver-backed money would become preferred to Federal Reserve Notes, which were not backed by anything, and therefore the new currency would eventually end the need for the Federal Reserve and its monopoly money.16

As to the justification for the creation of such a financial behemoth that has come to control every aspect of our monetary policy, where is the economic stability and prosperity promised to us? Since the creation of the Federal Reserve, we have experienced the Great Depression, a recession in the early 1980s, the market crash of 1987, and finally, the economic crisis we find ourselves in today. And during all these events, there has also been the constant depreciation of the dollar. These are the result of the inflationary habits of the Federal Reserve, inflationary habits that no one can control or prevent, not without the abolition of the Fed. Rather than dethroning the moneyed elite, the Federal Reserve was their vehicle for a further power grab.

As F. A. Hayek, a noted Austrian economist, once said, “[t]o put it [money] in the hands of an institution which is protected against competition, which can force us to accept the money, which is subject to incessant political pressure, such an authority will never give us good money.”17The American dollar today is worth just 7 percent of what it was worth in 1913, when the Fed was established to stabilize it.

Money Does Grow on Trees

Those who argued for the Federal Reserve Act focused on the fact that we needed to ensure that our currency was “flexible.” They argued that this flexibility was crucial to ensuring that the federal government and the country did not run out of money. Where they criticized the gold standard for not being able to sustain the economy and allow for growth, they argued that this protection would ensure that we never ran out of money. In essence, the Federal Reserve Act brought into law the idea that money could come from nowhere. Not many people realize how the system works, or where our money comes from.

What supporters of the Federal Reserve Act further argued is that if state banks did not have someone to look out for them, they would in essence overissue their notes and reduce the amount of money they kept in reserve because of their need to make a profit. This action would lead to inflation and economic instability. One would think that if bankers were decentralized and could not depend