I agree with Judge Andrew Napolitano, who said last week, “We know more about the CIA than we do about the Federal Reserve.”
The Federal Reserve is the Freemasonry of government agencies. It is a virtual secret society unto themselves – a group of unelected brokers who hold the value of our dollar in the palms of their hands. This one agency, with its power to raise and lower interest rates, has exercised more control over the economy than any other government body.
So with that type of single-handed power, why should we be surprised when the U.S. Senate blocked a bill last week to audit the Federal Reserve? Tis true! Rep. Ron Paul and more than half of the House cosponsored the Federal Reserve Transparency Act, HR 1207, which they hope to have hearings on soon. On the Senate side, however, Sens. Jim DeMint, Mike Crapo and David Vitter cosponsored S 604, companion legislation introduced by Bernie Sanders. But it was stopped cold before even being introduced on the floor on “procedural grounds.”
Could it really be a mere coincidence that the bill to audit the Federal Reserve was refused from even being introduced and that this agency remains the “quick convenience store-house of money” for the Obama administration’s borrowing and bailout monies?
Again, as Judge Napolitano said, “The Obama administration not only doesn’t want the Federal Reserve audited, it now wants to put the power to regulate all financial institutions – banks, insurance companies, brokerage houses – into the hands of this super secret bank. What are they afraid we might see if we get a chance to look at their books?”
As if there are not enough signs of the Fed’s inadequacy, two expert economists on the Federal Reserve specifically warned Congress last Thursday not to expand the power of the Fed to oversee and monitor public financial structures. Allan H. Meltzer, professor of economics at Carnegie-Mellon University and one of the central bank’s most prominent historians, having written a three-volume reference work on it, conveyed a series of U.S. financial collapses over the last three decades in which the Fed had either failed to take preventive action or made things worse.
And the White House and majority on Capitol Hill want to give the Federal Reserve more power and autonomy? Have they finally lost their minds?
So why does this federal agency need a complete auditing? It’s very simple. Because America is in the worst economic situation since the Great Depression, the value of the dollar is tanking on the world market and the Federal Reserve wields the greatest power to control it with virtually no accountability – let alone that the American people and even Congress have virtually no knowledge of what those inside are doing day to day.
On Dec. 23, 1913, President Woodrow Wilson signed the Federal Reserve Act, creating a seven-member board of governors (appointed by the president and approved by Congress) and 12 regional banks. From thereafter, banks continued lending money to the public, but the Fed controlled the flow of money via fluctuating interest rates and the tides of credit and money supply and demand. (This was the gravest governmental mistake in 1913. A close second was the ratification of the 16th Amendment to the Constitution, which mandated income taxes as national law.)
The way I see it, there are two primary problems with the Federal Reserve. First, it’s very existence is a sheer contradiction of the 10th Amendment of the Constitution. As Ron Paul explained last week:
Our Founding Fathers never intended for a single entity such as the Federal Reserve to have this much power. In fact, there is no authority in the Constitution for the federal government to create a central bank, to enact legal tender laws, or to print paper money. The 10th Amendment is quite clear that “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”
The fact is, the Federal Reserve is one of the best examples of government control run amok and its oppression over its people. It rules by dangling carrots, cheap rates and loans, before the American public, which in turn oppresses people by their inability to resist further debt. The Fed is the dealer in greed and debt – and its drugs are easy money and credit. Under the Federal Reserve System, Americans and our economy have to return to the Federal Reserve for repeated fixes like a drug addict. Otherwise everything goes into the tank.
Secondly, the Federal Reserve is flat out bad for the economy in the long run because it creates false fronts or temporary escalations in the free market, which eventually cycle around and lead to downturns or more needs for other Fed fixes. Even if it creates several cycles of credit rushes (which it deems as “signs of prosperity”), sooner or later the false foundation crumbles, and we find ourselves in an economic hole that we or the Fed can’t bail us out of – which is exactly where we are now in this recession.
The fact is, if we can get the flow of the Federal Reserve under control, others drawing from its wells will become more manageable and accountable. Its open-market operations and dealings with central banks and foreign powers, at very least, must have oversight!
But you can bet Nancy Pelosi and Harry Reid are going to fight to prevent the passage of any legislation that regulates the Federal Reserve because they are in cahoots with the White House and also don’t want the trade secrets of the Federal Reserve revealed nor its power restricted. Why? Because its power benefits them, plain and simple. It is right now being used by the Obama administration and the Democratic majority for political expedience and special interests.
We need to return to a country that lives within its means – that steps off the credit merry-go-rounds to a pay-as-you-go republic, as it was in the beginning. I believe that so firmly that the only chapter on financial recovery I included in my New York Times best-seller, “Black Belt Patriotism,” is simply titled “Stop America’s Nightmare of Debt.” In it, I advise a return to the fiscal prudence of men like Thomas Jefferson. Jefferson was not opposed to borrowing, but he did recognize the danger of ballooning government deficits and increasing taxes. He elaborated to George Washington, “I am anxious about everything which may affect our credit. My wish would be, to possess it in the highest degree, but to use it little.”
It’s unfortunate that more leaders today didn’t agree with Jefferson, or James Madison, who said at the time, “I go on the principle that a public debt is a public curse.” Jefferson’s attitude toward debt was simple, and he gave the best advice one could get: “The conclusion then, is, that neither the representatives of a nation, nor the whole nation itself assembled, can validly engage debts beyond what they may pay in their own time.” They believed in the biblical precedent, “The wicked borrows and does not repay.”
Private debt is a private matter. But it should not be encouraged or enticed, especially by the federal government! That’s why I believe the Federal Reserve needs to be abolished. The U.S. ran just fine without it – before its inception in 1913. We had financial crises before its existence and after it, but its intervention has been proven historically only to make things worse. Our founders would have never tolerated its abusive power or methods of bribery. It is not only a detriment to the economy and the very existence of a representative form of government like ours, but to all Americans who want to experience true freedom.
Henry Ford was probably right when he said, “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
In the meantime, however, until some act of God or the people do away with that self-regulating and fraudulent government agency, the least we can do is get the Federal Reserve under control by passing HR 1207 in the House and S 604 in the Senate. Write today and demand that your representatives support the bills that require an audit of the Federal Reserve.