History (FIX)

Background The World’s greatest problem, besides poor spiritual values, is that the governments of the World do not create their own money, but have allowed private banks to usurp the special privilege to lend their credits into circulation in place of actual money. Whether a nation has a private or a governmentally owned central bank the private bank loans function as money within the world’s economies. Two major problems arise: First the obvious interest cost which the banks receive when they create money out of thin air. This costs the US government about $400 billion per year in interest charges on the national debt – about 18-20 % of the annual federal budget. Not to mention the interest the banks also charge against all the private borrowings. So the private creation of fiat money acts like a private tax on all of society, to the benefit of those with the privilege to create such money. This has spread poverty and has concentrated wealth to obscene levels! Societies might survive even with such a ball-and-chain around every producer’s leg, but the second problem is even worse: It’s the bankers, not the society, who decide the direction of the nation – what gets funded and what does not. Will money go into fixing New Orleans levees and Minneapolis bridges, or into real estate bubbles and Wall Street gambling, and warfare? Understanding The Nature of MoneyMankind can survive under all sorts of political systems from democracy to dictatorship, but the best systems will be those in harmony with the nature of man. Likewise all sorts of things can be used as money; but the best will be that in harmony with the nature of money. Therefore evaluating what constitutes proper monetary reform requires us to examine the nature of money. In 1718, John Locke wrote: “Observe well these rules: It is a very common mistake to say that money is a commodity… [but] Bullion is valued by its weight…money is valued by its stamp.” America’s great Ben Franklin agreed, writing: “Silver and gold…(are) of no certain permanent value…We must distinguish between money as it is bullion, which is merchandise, and as by being coined it is made a currency; for its value as merchandise, and its value as a currency are two different things…” (LSM, Ch. 14*)