How the US Uses War to Protect the Dollar

The Gods of Money

William Engdahl (2015)

The first video is a 2015 presentation by William Engdahl about his 2010 book The Gods of Money. It focuses on the use of US economic and military warfare to maintain the supremacy of the US dollar as the global reserve currency.

As his point of departure, he begins with the 1944 Bretton Woods agreement, in which the Allied powers agreed to use the gold-backed US dollar as the world’s reserve currency. In 1971 when Nixon was forced to end the gold standard,* the gold-backed US dollar was replaced by the “petrodollar.” According to Engdahl, it was so named because of a secret agreement the US made with Saudi Arabia – in return for a guarantee that OPEC would only trade oil in US dollars, the US guaranteed the Saudis unlimited military hardware.

In this way, oil importing nations (most of the world) were forced to retain substantial US dollar reserves. This was the only way they could provide their economies with a continuous supply of oil.

The petrodollar remained supreme until the mid-1980s, when the collapse of the US Savings and Loan industry (a pre-cursor of the 2007 banking collapse) raised concerns in Europe that the US was failing as a super power. Fearing the US economy was collapsing, they created the euro and the Eurozone, to prevent the Soviet Union or China from filling the power vacuum.

The financial warfare unit of the US treasury responded by feeding hedge fund manager and currency speculator George Soros secret information that enabled him to lead an attack on the British pound. This, in turn, destabilized the British economy to the point the UK no longer qualified to join the euro.

In 1997 the US Treasury and Soros made a a similar attack on economies of Southeast Asia (Thailand, South Korea, Indonesia, Hong Kong, Laos, Malaysia, Philippines) that attempted to use currencies other than the dollar as their reserve currencies.

In 2010, after the US government had run three years of $1 trillion deficits, China, Russia and Japan announced their intention of selling US Treasury bonds (which the US government sells to finance its debt) to increase their euro reserves. Concerned this placed the US dollar on the brink of catastrophic collapse, the US Treasury and Soros attacked the Euro directly by collapsing the Greek economy. The mechanism Soros used was to direct his hedge funds to dump the sovereign treasury bonds that financed Greek debt.** When the European Central Bank announced its commitment to a Greek bail-out, the US Treasury and Soros followed up with an attack on Irish, Spanish and Portuguese sovereign bonds.


*A US economic crisis led to massive foreign demand for US dollar redemption that threatened to deplete US gold reserves.

** The immediate effect of bondholders dumping Greek bonds raised interest rates on Greek debt to a level that threatened to bankrupt their government.

 

 

The second clip is a Guns and Butter radio interview with Engdahl. It focuses on a second area the Gods of Money covers, namely the long US battle to abolish their private central bank (aka the Federal Reserve) and end the ability of private banks to create money out of thin air (see How Banks Create Money Out of Thin Air).

After a brief explanation of fractional reserve banking, whereby 97% of our money is created by private banks, Engdahl traces the history of the First Bank of the United States, created by Alexander Hamilton in 1791. The latter was the first US central bank, 80% owned by private (mostly Rothschild-controlled) banks in the City of London and 20% owned by the US government. President James Madison’s refusal to renew the bank’s charter in 1811 would result in Britain and the US going to war in 1812.

When the war ended in 1815, the American war debt was so substantial, the US had no choice but to charter the Second Bank of the United States, which once again was 80% controlled by London banks.

In 1832, Andrew Jackson refused to renew the bank’s charter, and the US had no central bank between 1832 and 1913. In 1913 when President Woodrow Wilson secretly colluded with the global banking establishment to create the Federal Reserve.

Both Lincoln and Kennedy challenged the exclusive role private banks play in creating the US money supply – Lincoln by issuing greenbacks (rather than borrowing money from private banks) to pay for the civil war and Kennedy by issuing silver certificates directly redeemable by the US Treasury. In both cases, Engdahl feels their defiance of the international banking establishment played a role in the decision to assassinate them.

Populism: America’s Largest Mass Democratic Movement

 

populist-moment

The Populist Moment: A Short History of the Agrarian Revolt in America

by Lawrence Goodwyn

Oxford University Press (1978)

Book Review

The Populist Moment describes the rise and fall of the 19th century populist movement, the largest mass democratic movement in US history. At its zenith during the 1896 election, the populist People’s Party had two million members.

Author Lawrence Goodwyn credits the rise of the agrarian populist movement to two major factors: 1) the unwillingness of the Eastern banking establishment to issue adequate credit to small family farmers and 2) the sudden contraction of the money supply caused by pressure on the post-Civil War government to repay bonds it floated for $450 million of treasury notes (aka Greenbacks) Lincoln used to pay for the Civil War.

Goodwyn also blames the systematic failure of commercial banks to issue adequate credit for the ultimate consolidation and centralization of farming in the US, leading to the eventual rise of industrial agriculture.

The Call to Prohibit Private Banks from Issuing Money

The populist movement started in Texas in 1878 as the Alliance. At first the group focused on forming cooperative buying committees, trade stores and crop insurance schemes to circumvent the crop-lien system that caused so many farmers to lose their land. Their chief organizing strategy was to send farmer-lecturers throughout Texas and eventually other parts of the South, Midwest and West. The banks, railroads, grain elevators and supply merchants responded by secretly conspiring to freeze them out. In turn the Alliance formed the People’s Party, whose main platform called for ending commercial banks’ ability to issue money.*

Goodwyn provides a detailed state-by-state history of the leadership struggles in the Alliance and in the People’s Party. Both made concerted efforts to reach out to Negro farmers and tenant farmers and to industrial workers, represented by the Knights of Labor and the American Federation of Labor, in the cities.

Overcoming Cultural Oppression

The book concludes by tracing the rise of the liberal and progressive movements that followed the demise of the People’s Party. The primary focus of these later movements has been to “humanize” industrial capitalism – as opposed to attacking the fundamental structure of capitalism (like populist movement). Goodwyn blames the absence of comparable mass movements in the twentieth century on the profound psychological oppression that occurs in modern industrialized society.

According to Goodwyn, the values of the corporate state totally dominates modern American intellectual life, as citizens of industrialized society are taught rules of conduct (in schools, churches and the media) that intimidate them and condition them not to rebel.  The Alliance overcame these cultural barriers by training and dispatching farmer-lecturers to teach farmers collective self-confidence and self-assertion – ie that the banks, rather than farmers themselves, were responsible for their predicament. Up to this point in time, no democratic mass movement has attempted a similar program of mass education.


*Contrary to popular belief, money used to run the global economy isn’t issued by governments but by private banks. Although most people think banks only loan out money they hold on deposit, loans are actually  created out of thin air via a bookkeeping entry.  Because this is where roughly 97% of money comes from, private banks have ultimate control over the amount of money in circulation. They exert enormous political power by shrinking the money supply to cause recessions and expanding it to cause inflation. See How Banks Invent Money Out of Thin Air , Stripping Banks of Their Power to Issue Money and 97% Owned

The Role of Foreign Banks in US History

moneychangers

Stuff They Forgot to Teach in High School

The Money Masters

Bill Still 1996

Film Review

Produced twelve years before the 2008 economic collapse, The Money Masters provides a comprehensive outline of the role of the international banking cartel in hijacking America’s so-called “democratic” government. Referring to them as “moneychangers” (a New Testament reference), Still explores the key role international banksters have played in deliberately creating depressions and panics, instigating US wars, and assassinating presidents who sought to curtail their power.

Understanding how money is created in the US and other capitalist countries is essential in grasping this historical perspective. Contrary to popular misconception, the federal government doesn’t create or control the money supply – private banks do. Moreover the Federal Reserve isn’t a government agency. It’s actually a private corporation owned by its member banks. What’s more, the fractional reserve banking system allows these banks to loan and charge interest on money they don’t possess – that they essentially create out of thin air.

Most of the film is devoted to the 130 year battle between the world banking cartel and the American presidents who stood up to them: Jefferson, Madison, Andrew Jackson, Lincoln, McKinley, Teddy Roosevelt, and Warren Harding. Jefferson and Madison both warned that allowing private banks to seize control of money creation would be the end of democratic rule in the US.

During the 19th century, the global banking cartel was dominated by key families, like the Rothschilds and Rockefellers. However during the 20th century, this power shifted to a corporate structure with control residing with CEOs and interlocking boards. Still stresses that global economic and political instability can no longer be blamed on specific families (i.e. the Rothschilds) – that the problem lies with the corporate banking system itself.

The solution he proposes is to end fractional reserve banking and the ability of private banks to create money – to follow Lincoln’s example by restoring the responsibility for money creation to federal and state governments.

As the 3 ½ hour film below covers nearly 1000 years of history, I have indexed the key historical events covered:

  • 0-21 min – 1100 AD King Henry I creates the tally stick to counter the influence of private goldsmiths and moneychangers who are wreaking economic havoc by manipulating the supply of gold coins.
  • 22-27 min – 17th century Queen Elizabeth I counters the power of private moneychangers by issuing coins directly from the royal treasury. In 1642, international moneychangers finance Oliver Cromwell, who leads a Civil War to overthrow the monarchy. Later they finance an invasion by the Dutch William of Orange to invade England and overthrow the House of Stuart. In 1694 Bank of England (the world’s first central bank) is formed and granted power to create money out of thin air.
  • 28-36 min 18th century Amschel Moses Bower, Frankfurt moneychanger, changes his name to Rothschild and five of his sons assume control of the central banks of Germany, Austria, London, Italy and Paris. The Rothschild family plays major role in financing the Vanderbilt and Harrison railroad monopolies, Carnegie’s monopoly of the steel industry, and 80% of JP Morgan’s holdings. The Rothschild family proceeds to finance both sides of a continuous cycle of European wars. The British treasury incurs a 140 million pound debt to the Bank of England. George III is forced to raise revenue by taxing the American colonies.
  • 37-38 min 1764 Under pressure from the Bank of England, George III passes currency act forbidding the use of colonial scrip (paper money) in the American colonies. Forced to use scarce gold and silver coins issued by the Bank of England, the colonies are plunged into deep depression with massive unemployment. Benjamin Franklin maintains this, not the tea tax, triggers the American Revolution.
  • 39-44 min 1781 Over strong objections of Jefferson and Madison, charter is granted for the Bank of North America, a privately owned central bank which is allowed to create money out of thin air. Charter allowed to lapse in 1785, and power to issue money reverts to federal government.
  • 45–51 min 1790 Alexander Hamilton pressures Congress to charter a second private bank, the Bank of the United States. The US Treasury, which provides all the funds, is a 20% shareholder. The Bank creates money out of thin air to loan funds to private shareholders to purchase the other 80%.
  • 52-99 min 1811 Congress refuses to renew Bank of US charter, despite a threat by Nathan Mayer Rothschild that “ . . .the United Stateswill find itself involved in a most disastrous war (War of 1812) if the bank’s charter is not renewed.”
  • 1:00-1:01hr 1816 Devastated by war and war debt, Congress grants new charter for the (private) Bank of the United States, again funded mainly by the federal government. The US Treasury winds up with 20% share, with the Bank creating additional money to loan private shareholders (mostly foreign) sufficient funds to buy the other 80%.
  • 1:02-1:10hr 1828 Andrew Jackson elected president on platform to end massive corruption and fraud at the Bank of the United Statesby shutting it down. Nearly assassinated after “powerful Europeans” hire gunman to kill him. The USremains free of central bank control for 77 years, with state chartered banks assuming responsibility for money creation.
  • 1:11-1:18hr Civil War European financial powers pressure Southern states to secede by boycotting their cotton. Ending slavery was not the original cause of US Civil War, as Lincolnoriginally had no intention of abolishing it.
  • 1:19-1:27hr 1862 To finance the Civil War,  Lincoln issues $450 million in paper money (greenbacks) and is attacked by the London Times – which calls for the destruction of the US before it destroys the world’s monarchies. British troops mobilize in Canada and British navy mobilizes on Atlantic coast. The Rothschilds grant Napoleon III $3 million to seize Mexico. Russian czar stations battleships on West Coast and pledges to come to US defense if England and France enter Civil War (on behalf of the South). Lincoln agrees to allow national banks to temporarily issue currency through 1863 National Banking Act, though his government-issued greenbacks continue to circulate until 1994. German chancellor Otto von Bismarck predicts triumph for global banking cartel following Lincoln’s 1865 assassination. In 1934 Vancouver Mayor Gerry McGreer releases Secret Service records revealing John Wilkes Booth was hired by powerful banking interests.
  • 1:28–1:30hr 1873 Banking interests pressure Congress to demonetize silver (which is far more plentiful than gold) and place all US money on gold standard. Deliberate contraction of the money supply leads to severe depression and unemployment (1/3 of US workforce unemployed in 1876). In 1877 riots calling for return of silver currency lead to 1878 Sherman Law, which allows limited number of silver coins to be minted.
  • 1:37-1:38 hr 1881 President Garfield attacks the moneychangers and is assassinated.
  • 1.38–1:47 hr 1891-1907 Determined to manipulate public opinion in favor of a new (private) central bank, the moneychangers deliberately shrink US money supply, causing 20 years of extreme economic instability. .
  • 1:48-1:54 hr 1907 secret meeting of Rockefellers and other major banking families at Jekyll Island to draw up plans for new central bank called the Federal Reserve. President Taft (a Republican) refuses to support it, so moneychangers begin courting Woodrow Wilson (a Democrat)
  • 1:54-1:57 hr 1913 Wilson defeats Taft with support from William Jennings Bryant and other currency reformers by promising he won’t support the new central bank. Wilson betrays his supporters and Federal Reserve Act passed during Christmas recess. The Act requires the federal government to borrow funding for operational expenses from the Federal Reserve. A federal income tax is adopted to ensure the government can make the interest payments.
  • 2:13-2:17 hr 1905-1917 $20 million of Federal Reserve funds channeled to Bolsheviks via Chase Manhattan Bank (controlled by Rockefellers) after czar denies them access to Russian oil fields.
  • 2:18- 2:29 hr 1929 Federal Reserve deliberately contracts money supply and crashes the stock market after all their members transfer their wealth from stocks to gold and cash. According to Milton Friedman, this contraction triggers Great Depression.
  • 2:30-2:31hr 1931 Rep Louis McFadden warns that US banks are subsidizing the rise of Hitler, channeling over $30 billion in Federal Reserve funds via Chase Manhattan Bank.
  • 2:32-2:44 hr 1933 Roosevelt prohibits US citizens from owning gold coins or bullion and forces them to turn all their gold to the federal government. All US Treasury gold becomes property of Federal Reserve and most of it is sold to European speculators.
  • 2:45-2:50 hr 1945 a global central bank is formed through creation of IMF, World Bank, and International Bank of Settlements. All are run by private bankers, with intention of consolidating control of the global money supply.
  • 2:51-2:58 hr 1989-1993 Economy of Japan and Mexico wiped out when Bank of International Settlements contracts the global money supply. Punitive IMF interest charges result in massive transfer of wealth from third world countries to World Bank. Continuing consolidation of central bank control with formation of NAFTA and WTO.

Still produced a sequel to the Money Masters in 2010 called The Secret of Oz in 2010. It focuses mainly on the rise of the Populist movement in the 1890s and the presidential campaigns of Populist Democrat William Jennings Bryant. Bryant ran on a platform of ending the power of private banks to issue money and returning to federally issued greenbacks and silver coinage. L Frank Baum, who wrote The Wonderful Wizard of Oz, was a strong Bryant supporter. The book is loaded with symbols related to monetary reform (for example, the silver slippers, Emerald City, and the yellow brick road).

Enjoy.

photo credit: Cea. via photopin cc

Reposted from Veterans Today