Money and the State

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by Free Radical

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. – Henry Ford

Once the domain of society – of the cooperative interaction that is its natural mode of economic organization and integration – the control of money has been usurped by the state and accordingly monopolized. Moreover, the monopolization is now a fait accompli due the state’s abandonment of gold, or any other commodity, as the monetary standard. Money has been positivized, in other words, in that it is now created not by “voluntary agreement between the parties immediately affected”  but by the authoritarian degree of a third party. And it is because of this positivization that society’s money has effectively been stolen from it, toppling the first of civilization’s twin pillars.

How could this happen? How could the state get away with stealing society’s money?

“For the étatist, money is a creature of the state,”  and surely one of the greatest tragedies of our time is that the people, in their unwitting acceptance of monetary positiv-ism, are statists themselves, if only as pawns in a game that has been rigged utterly and completely against them. For so meager and confused is the people’s understanding of money that it is inconceivable to them that “all money has originated, and must originate, in a useful commodity chosen by the free market as a medium of exchange;”  that the state is accordingly “powerless to create money for the economy;”  that the first act of every sufficiently large state is “to seize an absolute monopoly of the minting business” as the “indispensable means of getting control of the coinage supply;”  that “inflation, being a fraudulent invasion of property, could not take place on the free market;”  that with the creation of a central bank, all banks become, by extension, “arms of the govern-ment;”  that “Centralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly” is not capitalism but communism;  that by going off the gold standard and issuing only fiat money, the state is simply issuing “paper … with nothing but paper backing;”  that the globalization of this system consti-tutes “the most gigantic trust [cartel] on earth;”  that the kingpin of this cartel is the United States Federal Reserve System; that the Federal Reserve can “never add anything to our capital structure, or to the formation of capital, because it is organized to produce credit;”  that a monetary system based on credit is a monetary system based on debt; and that the United States Government, which had virtually no debt prior to the creation of the Federal Reserve, is now approaching $14 trillion in debt. Moreover, when the gov-ernment’s unfunded welfare and related liabilities are factored in, the country is facing a fiscal gap of $202 trillion, amounting over $650,000, and counting, for every man, woman, and child in America.

Because these debts can never be repaid and will instead be variously inflated away by the Federal Reserve and defaulted on by the Treasury, the American people will pay the price through the devaluation of the government’s monopoly money on the one hand – money, let us be clear, that has already lost over 97% of its value – and through broken government promises on the other.

Moreover, as the government’s money metastasizes, so do its laws. And were the people to understand that the latter are no less fraudulent than the former, they would run from legal positivism as fast as they will soon be running from monetary positivism.

 

This article first appeared on ZeroHedge