Fed’s Money Monopoly Endangers Liberty and Peace

March 6, 2012


“You can line up 100 professional war historians and political scientists and talk about the twentieth century,and not one is likely to mention the role of the Fed in funding U.S. militarism. And yet it is true: the Fed is the institution that has created the money to fund the wars. In this role, it has solved a major problem that the state has confronted for all of human history. A state without money or a state that must tax its citizens to raise money for its wars is necessarily limited in its imperial ambitions.”

"One can say without exaggeration that inflation is an indispensable means of militarism.Without it, the repercussions of war on welfare become obvious much more quickly and penetratingly; war weariness would set in much earlier." Ludwig Von Mises

“To be sure, it doesn’t require a central bank for a state to choose inflation over taxes as a means of funding itself. All it really requires is a monopoly on the production of money. Once acquired, the monopoly on money production leads to a systematic process of depreciating the currency, whether by coin clipping or debasement or the introduction of paper money, which can then be printed without limit. The central bank assists in this process in a critical sense: it cartelizes the banking system as the essential conduit by which money is lent to the public and to the government itself.”

“The banking system thereby becomes a primary funding agency to the state, and, in exchange for its services, the banking system is guaranteed against insolvency and business failure as it profits from inflation. If the goal of the state is the complete monopolization of money under an infinitely flexible paper-money system, there is no better path for the state than the creation of a central bank. This is the greatest achievement for the victory of power over liberty.”

HS: This explains why Ron Paul, fruitlessly, aims to introduce gold as a competitor to fiat currency. He knows a) good money forces out bad money b) the central bank is critical to funding imperial overreach, less governments would have to raise taxes to fund wars.

Source: Understanding the Banking System

Further Reading:

The Specious Economics of Wars
Long and Variable Lags Between Money Supply and Inflation
Causes and Patterns of Hyperinflation in the 20th Century
Federal Reserve Balance Sheet Risks
The Supply of Money and Reichsbank Financing of Government and
Related Posts Plugin for WordPress, Blogger...

Popularity: 1% [?]


Previous post:

Next post: