BILLIONS for the BANKERS
DEBTS for the PEOPLE
Canadians living in what is called one of the richest countries in natural resources per capita on earth, seem to be short of money. Families require two wage earners just to survive as wives are working in unprecedented numbers, husbands hope for overtime hours to earn more, or either take extra part-time jobs evenings and weekends; children look for odd jobs for spending money; the family debt climbs higher; and, psychologists say one of the biggest causes of family quarrels and breakups is "arguments over money." Much of this trouble can be traced to our present "debt-money" system.
Few Canadians realize why the Fathers of Confederation wrote into the British North America Act (under Section 91, Clause 14 and 15), that Legislative Authority of Parliament shall have the power to issue "Currency and Coinage" and "Banking, Incorporation of Banks, and the Issue of Paper Money". They did this, in prayerful hope that it would prevent the love of money from destroying the democratic government they had founded.
MONEY IS MAN'S ONLY "CREATION"
Economists use the word "create" when speaking of the process by which money comes into existence. New creation means making something that did not exist before. Lumbermen make boards from trees; workers build houses from lumber; and, factories manufacture automobiles from metal, glass and other materials. But in all these they did not "create" - they only changed existing materials into a more usable and therefore more valuable form. This is not so with money. Here and here alone, man actually "creates" something out of nothing. A piece of paper of little value is printed so that it is worth a piece of lumber. With different figures it can buy the automobile or even the house. Its value has been "created" in the true meaning of the word.
MONEY "CREATING" IS VERY PROFITABLE As is seen by the above, money is very cheap to make, and whoever does the "creating" of money in a nation can make a tremendous profit! Builders work hard to make a profit of 5% above their cost to build a house.
Auto makers sell their cars for 1% to 2% above the cost of manufacture and it is considered good business. But money "manufacturers" have no limit on their profits, since a few cents will print either a $1 bill or a $10,000 bill.
That profit is part of this story.
AN ADEQUATE MONEY SUPPLY IS NEEDED An adequate supply of money is indispensable to civilized society. We could forego many other things, but without money industry would grind to a halt, farms would become only self-sustaining units, surplus food would disappear, jobs requiring the work of more than one man or one family would remain undone, shipping and large movements of goods would cease, hungry people would plunder and kill to remain alive, and all government except family or tribe would cease to function. An overstatement, you say? Not at all. Money is the blood of civilized society, the means of all commercial trade except simple barter. It is the measure and the instrument by which one product is sold and another purchased. Remove money or even reduce the supply below that which is necessary to carry on at current levels of trade, and the results are catastrophic. For an example, we need only look at the Great Depression of the early 1930s.
THE BANKERS DEPRESSION OF THE 1930's In 1930 Canada did not lack industrial capacity, fertile farmland, skilled and willing workers or industrious farm families. It had an extensive and highly efficient transportation system in railroads, road networks, and inland and ocean waterways. Communications between regions and localities were the best in the world, utilizing telephone, teletype, radio and a well-operated government mail system. No war had ravaged the cities or the countryside, no pestilence weakened the population, nor had famine stalked the land. The Canadian economy in 1930 lacked only one thing: an adequate supply of money to carry on trade and commerce. Bankers, the source of Canada's money and credit, had deliberately withheld millions from circulation by refusing loans to stable and growing industries, stores and farmers. At the same time they demanded payment on existing loans so that money was rapidly taken out of circulation and was not replaced. Canada was put in a "depression" and in deep trouble. Goods were available to be purchased, jobs waiting to be done, but little money. Twenty-five percent of the workers were laid off. Banks took possession of tens of thousands of farms and businesses on foreclosure. Gloom settled over Canada and we can only visualize the results if this had continued 20 years instead of 10.
WAR ENDED "DEPRESSION"
Our "depression" lasted until 1939, when the Canadian Government began to spend large amounts of money into circulation for military preparedness for ourselves and future allies in Europe. As soon as the money supply went up people were hired back to work, farms sold their produce instead of plowing it under, mines reopened, factories began to hum and both industrial and residential construction began anew. The "Great Depression" was over. Some politicians were blamed for it and others took credit for ending it. The truth was that lack of money caused it and adequate supply ended it. The people were never told the simple truth and in this article we will endeavor to show how those who "manufacture" and "control" our money have used its profits to "buy" our politicians, and now control our Government.
POWER TO COIN AND REGULATE MONEY When we can see the disastrous results of an artificially created shortage of money, we can better understand why our Founding Fathers, who understood both money and God's Laws, insisted on placing the power to "create" money and the power to control it ONLY in the hands of the Federal Government. They believed that ALL citizens should share in the profits of its "creation" and therefore the national government must be the ONLY creator of money. They further believed that ALL Canadian citizens, regardless of station in life, would benefit by an adequate and stable currency and therefore the national government must also be, by law, the ONLY controller of the value of money. Since the Federal Government was the only legislative body subject to all the citizens at the ballot box, it was, to their minds, the only safe depository of so much profit and so much power. They wrote it in simple language, "The Federal Government shall have the Power to Coin Money and Regulate the Value Thereof."
HOW THE PEOPLE LOST CONTROL
Instead of the Constitutional method of creating our money and putting it into circulation, we now have an entirely unconstitutional system. This has resulted in almost disastrous conditions, as we shall see. A historical sketch of currency and banking in Canada, tracing certain features of the central banking system that have finally led up to the establishment of the Bank of Canada appears on pages 900-905 of the 1938 Canada Year Book. In chronological order these are:
- Central Note Issue, permanently established with the issue of Dominion Notes under legislation of 1868.
- The Canadian Bankers' Association, established in 1900 and designed to effect greater co-operation amongst the banks in the issue of notes, in credit control and in various aspects of bank activities.
- The Central Gold Reserves, established by the Bank Act of 1913.
- Rediscount Facilities, originated as a war measure by the Finance Act of 1914, and made a permanent feature of this system by the Finance Act of 1923. This Act empowers the Minister of Finance to issue Dominion Notes to the banks on the deposit by them of approved securities, thus providing the banks with a means of increasing their legal tender cash reserve at will.
I would like, at this point, to emphasize the last line of the above quotation:
"THUS PROVIDING THE BANKS WITH THE MEANS OF INCREASING THEIR LEGAL TENDER CASH RESERVE AT WILL." This is a most astounding statement. What it says is that the banks can create their own reserves, and then issue BANK CREDIT MONEY against these reserves that they themselves have created. In other words, they now need no gold, no silver, not even paper money, but all they need are government securities (bonds) as reserve for CREDIT MONEY and furthermore, they can buy these reserves (bonds) with the CREDIT MONEY that they have created. Did someone once say you can't get something for nothing? Let him investigate our monetary system and I am sure he will change his mind!
WE BORROW IT AND PAY THEM INTEREST We shall start with the need for money. The Federal Government, having spent more than it has taken from its citizens in taxes, needs, for the sake of illustration, $1,000,000,000 (1 BILLION DOLLARS). Since it does not have the money, because it has given away its authority to "create" it, the Government must go to the "creators" for the $1 billion. But, a private banking corporation doesn't just give its money away! The Bankers are willing to deliver $1,000,000,000 in money or credit to the Federal Government in exchange for the Government's agreement to pay it back - with interest! The government authorizes the Treasury Department to print $1,000,000,000 in Canadian bonds which are then delivered to the BANK OF CANADA. The BANK OF CANADA sells the BONDS to the privately owned banks. The privately owned banks pay for the bonds by creating a bank deposit of $1 billion on behalf of the federal government. This means that the private banks have created a billion dollars that did not exist before. This creation cost the private banks nothing except the cost of cancelling out the government cheques as the government spends the deposit by writing cheques against it. The private banks now own the billion dollars worth of bonds and at the present rate of 10 1/2% the FEDERAL GOVERNMENT TAXES THE PEOPLE OF CANADA year after year to pay the interest. The federal government has to date piled up a mountainous debt of $519,845,000,000 and the interest on this debt this year is $44,000,000,000+ or a per capita debt of $1,513. This means a family of four is taxed $6,052 a year just to pay the interest.
