dr. John DRABIK
MONEY SYSTEM – PRIVATE OR PUBLIC?
1913 is a notable date in the History of the United States. This is the date of founding the Federal Reserve System, the privately owned Central Bank of the United States, and introduction of the first federal taxes in the United States. Up to now the majority of national banks of the world is de jure national, but de facto private institutions. In 1913 there were really few people, who were able to understand the great importance of that event. One of the most significant consequences of this privatization is that – since that time – the taxes in the United States of America alone have consumed 55-60 per cent of labor wages. In addition to that, the state debt – not only in America, but all over the world – has been rocketing into astronomical sums.
The indebtedness is proceeding continuously despite of the repeated promises of governments and political parties to enforce fiscal and monetary responsibility. Hungary – for example – borrowed $US four billion in the 1970-s and paid to this date as interest and services of this debt about 64 billion dollar. Despite of this the total sum of the Hungarian external debt increased till January 1999 42,5 billion Dollar, and the internal state debt over 7000 billion HUF. To this sum comes still the internal debt of the private sector, which is unknown. The Hungarian state, private economy and society have to service the total debt over 73 billion dollar. This kind of situation is called “interest slavery” and “usury civilization”. All of these happened when real wages of employees, representing 80% of the total workforce, decreased dramatically during the last decades, while tax burdens during the same period dubbed.
Let us see the possible background!
State owned national banks, controlled in fact by parliaments, financed their governments’ programs by interest-free money. This kind of government financing was broken in 1913 in the United States by creating a private bank-cartel, the largest money-trust in the world, called: FED, in order to control the money system of the United States. Since that time, the central banks of the majority of the different states started the same practice. Their national banks have now been functioning as independent central banks, de facto in private control. The consequence of this new situation is that in credit operations between the previous two partners, the state and the national banks, there is a superfluous and very costly third factor, the money market. The governments, instead of financing themselves and the economy of their countries with capital by issuing money, are forced to borrow private credit money and to pay interest for it. Since that time the States, among them the most developed industrial states, accumulated an enormous sum of indebtedness and are paying ever-increasing interest upon the loans borrowed from the central and commercial banks and money market, all of them under private control. President Kennedy wanted to take back the monetary sovereignty of the United States and in 1963, applying the first capital of the American Constitution, introduced the interest-and debt-free money in a value of USD four billion United States Notes. This money represented a rivalry to the money, – issued by the FED -, which have been being valid since 1913. According to some experts, this can be one of the causes, why President Kennedy was at 23rd November 1963 assassinated. President Johnson reversed Kennedy’s measures. At present, half of the US federal budget goes on government debt services. One of the most effective forms of collecting interest for the sake of the private money owners by the help of the governments is the excessive taxation in the U.S.A. and other national states.
In the second year of his presidency, President Nixon terminated the Bretton-Woods treaty, lifted the gold-based currency rates of exchange, and set fluctuation of exchange rates off, starting a speculation wave, never having seen before. This action was followed by liberalizing and deregularizing of stocks, bonds and securities, and the money market very soon. Up to now the volume of this branch of trade is more than hundred times in excess of that of the trade of the real economy, and this phenomena is the route of pumping money out of the real economy into the financial system. This kind of trade is called “bubble trade” in the international money system and is accompanied by ever increasing fear of bursting this bubble off.
Next step is the so-called account-money-practice of the commercial banks. The essence of this practice is the following: banks are in a position to lend money, which money does not exist at all. Interest, paid upon the not-existing money, appearing on the banking accounts only, and makes the governments and the real economy run deeper into debt. Result is the debt-spiral, an ever-increasing crisis. Capitalism, during the last decades had overcame all of his rivals, namely communism, nazism, but the present over-monopolistic capitalism ruins social market-economy. The lifeblood of capitalism is competition. Monopol-capitalism – without real competition – seems to consume itself. This crisis of the global-capitalism is indicated in different works of internationally known economists and theoretical scientists.
The debate is going on about the present situation of the world: is this situation an inevitable consequence of the development of market forces, or is it a planned, systematic result of activity of an invisible world authority? Remedy of the problems, – in spite of innumerable proposals, theories, and problem solving attempts – is still in dark clouds. We can only hope and trust sensibleness and statesmanshift of statesmen that they will be able to find the way out of the mass of present baleful, danger-fraught problems. We need a real market economy without privately controlled money system, endless indebtedness to private moneylenders and ever increasing national and global monopolies. An over-centralized and concentrated economy and society cannot be democratic. We do not need independent central banks with over-secretive practices and monopolies, serving mainly private interests, but we do need publicly controlled banks of issue and money system with decentralized and really competitive market economy. Small is beautiful.
Hans-Peter Martin, Harald Schuman.
L.Thurow: The Future of Capitalism, Penguin Books, 1996.
Mónus, Áron: Összeesküvés, Interseas Edition, 1995.
Soros, György, A Globális Kapitalizmus Válsága, Scolar Kiadó Budapest, 1999.
Endrey, Antal: Disznófejű Nagyúr,
dr. John DRABIK