The document discusses the roots of the subprime mortgage crisis and how policies under the Clinton administration contributed greatly to the expansion of subprime mortgages. Specifically, changes to the Community Reinvestment Act in 1994 put pressure on banks to make loans to low-income borrowers through increased regulations and enforcement. This led banks to issue more subprime mortgages to maintain high CRA compliance scores. The massive growth in subprime lending from these policy changes was a key factor that helped drive the financial crisis. Clinton does not regret repealing Glass-Steagall, which further enabled risky behavior in the financial system.
1. More Stained Glass – or –
Sorry Seems to be the Hardest Word
A very perceptive attorney associate of OFGI pointed out an omission on the article
recently sent out entitled “Stained Glass – or – How We Got Where We Are”. His point is
well taken, and is well expressed by the article we found quoted in its entirety below (bold
& underline added for emphasis – parenthetic expressions added for commentary):
“The Roots of the Subprime
Mortgage Mess Have Clinton All
Over Them
By Jimmie on Sep 21, 2008 in The Economy and Your Money
There has been a lot of talk recently about subprime mortgages and the
thought occurred to me that something had to happen in the financial market
to make subprime mortgages so attractive for companies to offer.. First is this
tidbit from the USA Today, in 2004.
Subprime mortgage activity grew an average 25% a year from 1994 to
2003, outpacing the rate of growth for prime mortgages (jeessss – and we
wonder why we’re in a mess now???). The industry accounted for about $330
billion, or 9%, of U.S. mortgages in 2003, up from $35 billion a decade
earlier. (Hummm, how did that happen, Mr. Clinton???).
Where did this come from? It’s not as if subprime mortgages were brand new
things in 1994. They’ve existed for quite a long time, but mortgage
companies didn’t offer them very often. Something had to happen to
generate such a marked increase. Financial markets don’t just shift to a
new lending practice without a darned good reason. For there to be a
tenfold increase in subprime mortgages means that something dramatic
had to happen. So what was it?
In this case, it was the Clinton administration.
In 1994, the administration pushed through some fundamental changes to
the Community Reinvestment Act of 1977. The goal of these changes was to
make sure that banks were “serving low and moderate income
geographies” and making sure that these banks “economically
2. empowered persons of low and moderate income”. (In other words, make
bad loans to people who would not otherwise qualify in areas that are not
of interest against real estate that can’t be moved when the need comes
to foreclose). Regulators were then given more power to punish banks that
did not comply with the new rules These changes led directly, to the
explosion of subprime mortgages and contributed heavily to our current
financial debacle (as we have pointed out before, so what Clinton
balanced the budget – look what other great things he did for the
Nation!!!).
The changes did two basic things. First, the government changed the
measure by which the regulators decided whether a bank was in compliance
with the act or not. Prior to 1994, the ratings were determined in large part
by what efforts banks were taking to reach into these neighborhoods - what
advertising they were doing, how many bank branches they opened, what
sort of outreach they made into offering loans and mortgages. The new rules
made the rating dependent on outcome-based numbers - how many
mortgages were signed, how much money was loaned, and so on. Those
numbers were broken down on racial lines, as well as by neighborhood,
and by financial status. In other words, for a bank to get a good rating
under the CRA it had to actually start writing mortgages to low-income
lenders instead of simply offering mortgages and advertising its services.
This was not merely a matter of paperwork. As the Comtroller said in 1994,
non compliance would bring out “the full panoply of all our enforcement
armorarium”. In other words, the government had a couple brand-new
hammers and they intended to use them if banks didn’t make low-income
loans.
The second thing that happened is that the Clinton administration made it
easier for groups to make complaints against banks for perceived under-
performance. That put an immense amount of pressure on banks to cut deals
with largely left-wing political groups who then turned that money toward
more advocacy and dodgy loans. As a rather prescient article in the City
Paper put it:
Crucially, the new CRA regulations also instructed bank examiners to take
into account how well banks responded to complaints. The old CRA
evaluation process had allowed advocacy groups a chance to express their
views on individual banks, and publicly available data on the lending
patterns of individual banks allowed activist groups to target institutions
considered vulnerable to protest. But for advocacy groups that were in the
complaint business, the Clinton administration regulations offered a formal
invitation. The National Community Reinvestment Coalition—a foundation-
funded umbrella group for community activist groups that profit from the
CRA—issued a clarion call to its members in a leaflet entitled “The New CRA
3. Regulations: How Community Groups Can Get Involved.” “Timely comments,”
the NCRC observed with a certain understatement, “can have a strong
influence on a bank’s CRA rating.”
The Clinton administration’s get-tough regulatory regime mattered so
crucially because bank deregulation had set off a wave of mega-mergers,
including the acquisition of the Bank of America by NationsBank, BankBoston
by Fleet Financial, and Bankers Trust by Deutsche Bank. Regulatory approval
of such mergers depended, in part, on positive CRA ratings. “To avoid the
possibility of a denied or delayed application,” advises the NCRC in its
deadpan tone, “lending institutions have an incentive to make formal
agreements with community organizations.” By intervening—even just
threatening to intervene—in the CRA review process, left-wing nonprofit
groups have been able to gain control over eye-popping pools of bank
capital, which they in turn parcel out to individual low-income mortgage
seekers. A radical group called ACORN Housing has a $760 million
commitment from the Bank of New York; the Boston-based Neighborhood
Assistance Corporation of America has a $3-billion agreement with the Bank
of America; a coalition of groups headed by New Jersey Citizen Action has a
five-year, $13-billion agreement with First Union Corporation. Similar deals
operate in almost every major U.S. city. Observes Tom Callahan, executive
director of the Massachusetts Affordable Housing Alliance, which has $220
million in bank mortgage money to parcel out, “CRA is the backbone of
everything we do.”
It’s not a real mystery to see what happened next. Lending institutions,
under the gun to give out loans, started extending loans to people who
would not have qualified for them otherwise. Those loans, called
subprime because they are made to people who are not prime credit
risks, carried higher interest rates (because the lender needs to make
sure that it makes money out of a loan that is far more likely to go into
default) and other costly attachments that mitigated the risk to the
lender and the people whose money the lender was using for these loans
(i.e. folks like you and me). The more pressure that was put on banks
from these advocacy groups and government regulators, the more
subprime mortgages they issued to keep their CRA score high enough to
remain in compliance.
Now, the Clinton administration is not solely responsible for our current
financial woes, but it did contribute greatly to the explosion of subprime
mortgages, which helped drive us to where we are now. If we’re going to
eventually untangle this mess, the CRA and Clinton’s 1994 regulation
expansion is a good place to start.”
This is typical over-regulatory policies by Democratic regimes. The more
government oversight you pile on things the better, right? The entire Liberal
4. attitude, is that the “unwashed masses” (that is us) are not bright enough to handle
our own business, so we need layers upon layers of Governmental bureaucracy to
tell us what to do (for our own good of course). Well, just show even ONE instance
where that was true!!! In this case, not only over-regulation by the Executive
Branch, but over-regulation with an AGENDA.
No Regrets – or – Just Before Yom Kippur, Clinton Still Unrepentant:
Just days before Yom Kippur (the Day of Judgment & Repentance) Slick Willy is quoted to
have still not felt any regret or remorse (imagine that) about his campaign to overturn
Glass-Steagall back in 1999:
Bill Clinton Revisits His Economic Legacy (by Dana Goldstein at Tapped, The American Prospect)
on September 22, 2008 - posted - 10:37 PM
“One policy Clinton said he doesn’t regret is his repeal of the Glass-Steagall Act
in 1999, which, for the first time since the Depression, allowed commercial banks to engage
in investment banking activities. Clinton said the commercial banks were an important
moderating force on the risk-taking of the big investment firms that collapsed this week. “In
the case of the current crisis, I believe the bill I signed allowed Bank of America to take over
Merrill Lynch,” he said.”
So, there you have it. Just like they used to say on Saturday Night Live “I’m not sorry, I’m
glad I did it”. Yea, it did alright. What he neglected to mention is, that his repeal of Glass-
Steagall MADE THE BANK OF AMERICA TAKE OVER OF MERRILL LYNCH NECESSARY IN
THE FIRST PLACE.
Just Before the House Bailout Vote, a Democrat Congress
Woman just had to open her Mouth:
House Speaker Nancy Pelosi,D-Calif., is seen during a news conference on Capitol Hill in
Washington, DC, just minutes to an almost lead pipe synched House Vote to Bailout the
economy, our dear friend Nancy had to get up and tell the Nation that the House Democrats
had put together this wonderful bill, and that the Republicans had done not a darn thing.
As a result, the bill went down, 228-205. Thirteen of the 19 most vulnerable Republicans and Democrats in
an Associated Press analysis voted against the bill despite the pleas from President Bush and their party
leaders to pass it.
In all, 65 Republicans joined 140 Democrats in voting "yes," while 133 Republicans and 95 Democrats voted
"no."
5. The final stock carnage was 777 points, far surpassing the 684-point drop on the first trading day after the
Sept. 11, 2001, terror attacks. This was the largest single drop in one day – EVER. All because some liberal
from California couldn’t keep her d-mn mouth shut!
Stocks plummet in largest one-day point drop
ever
AP - 2 minutes ago
NEW YORK - The failure of the bailout package in Congress literally dropped jaws on Wall Street and
triggered a historic selloff — including a terrifying decline of nearly 500 points in mere minutes as the
vote took place, the closest thing to panic the stock market has seen in years.
How are we going to deal with this? Is the proposed bailout of the culprits that took
advantage of the Congressional and Presidential idiocy really the right thing to do? What
about all of the folks that had (bad) loans made to them that have lost or are losing their
homes? Is there an alternative that would actually work better????
Actually, although the House Speaker (boy, is THAT a good title for that gal), had all the
wrong motives, and, it is quite unfortunate that it caused the biggest drop in the market
EVER; it is probably a good thing that that thing on the top of her shoulders started moving
and making noise that resulted in the failure of the passage of this bill.
Frankly, they are bailing out the wrong folks! Why bail out the culprits that got greedy
when the folks that really need a bail out are those that were sold (often by unscrupulous
mortgage brokers that forged signatures, changed documents, padded incomes, etc.) and
got themselves into an ARM that they ultimately could not pay for???
There is some real reform needed, but it is uncertain that bailing out the folks that took a
great windfall under the Clinton Administration are the folks that need bailing out. What
about reforms? Let’s take a look at another Democratic Party invention – the Federal
Reserve…..
The Federal Reserve was established in 1913 by the Federal Reserve Act. Congressional
Republicans opposed this law. In fact, Congressman Charles Lindbergh (yea, your
remember right, he is the fellow that flew the ‘Spirit of Saint Luis’ over the pond) was one
of the strongest opponents to the Federal Reserve, and do you know what happened to
him? If no, go look it up, as it is a very interesting story….
http://en.wikipedia.org/wiki/Charles_August_Lindbergh
http://www.charleslindbergh.com/kidnap/index.asp
Republican Congressman Lindbergh said on that historic day, to the House:
"This Act establishes the most gigantic trust on earth. When the President signs this
bill, the invisible government by the Monetary Power will be legalized. The people
may not know it immediately, but the day of reckoning is only a few years removed.
6. The trusts will soon realize that they have gone too far even for their own good. The
people must make a declaration of independence to relieve themselves from the
Monetary Power. This they will be able to do by taking control of Congress. Wall
Streeters could not cheat us if you Senators and Representatives did not make a
humbug of Congress. . . . If we had a people’s Congress, there would be stability.”
What did the Federal Reserve Act do exactly?
Well, frankly, Congress literally gave over the Constitutional power of the U.S. Treasury to
manage the U.S. money supply and economy.
The “Federal Reserve” is NEITHER. It is NOT a Federal institution (and NEVER has been)
and THERE IS NO RESERVE.
The Fed is actually just a gentlemen’s club of member banks, governed by 12 regional
banks, and a CENTRAL bank.
THE ONLY THING FEDERAL ABOUT THE FED IS THAT EVERY SIX YEARS, THE CHAIRMAN
IS APPOINTED BY THE PRESIDENT OF THE United States.
Don’t just believe the above – take a look for yourself. Here is a quote from the Fed’s web
site:
“
The Structure of the Federal Reserve
System
Skip to content
The Board of Governors
of the Federal Reserve
System
On December 23, Appointments to the Board
7. 1913, the Federal Reserve The seven members of the Board of Governors are
System, which serves as the appointed by the President and confirmed by the Senate to
nation's central bank, was serve 14-year terms of office. Members may serve only one
created by an act of
Congress. The System
full term, but a member who has been appointed to
consists of a seven member complete an unexpired term may be reappointed to a full
Board of Governors with term. The President designates, and the Senate confirms,
headquarters in two members of the Board to be Chairman and Vice
Washington, D.C., and Chairman, for four-year terms.
twelve Reserve Banks
located in major cities
throughout the United
States.
Representation
Only one member of the Board may be selected from any one
of the twelve Federal Reserve Districts. In making
appointments, the President is directed by law to select a
"fair representation of the financial, agricultural, industrial,
and commercial interests and geographical divisions of the
country." These aspects of selection are intended to ensure
representation of regional interests and the interests of
various sectors of the public.
Responsibilities
The primary responsibility of the Board members is the
formulation of monetary policy. The seven Board members
constitute a majority of the 12-member Federal Open
Market Committee (FOMC), the group that makes the key
decisions affecting the cost and availability of money and
credit in the economy. The other five members of the FOMC
are Reserve Bank presidents, one of whom is the president
of the Federal Reserve Bank of New York. The other Bank
presidents serve one-year terms on a rotating basis. By
statute the FOMC determines its own organization, and by
tradition it elects the Chairman of the Board of Governors as
its Chairman and the President of the New York Bank as its
Vice Chairman.
The Board sets reserve requirements and shares the
responsibility with the Reserve Banks for discount rate
policy. These two functions plus open market operations
constitute the monetary policy tools of the Federal Reserve
System.
In addition to monetary policy responsibilities, the Federal
8. Reserve Board has regulatory and supervisory
responsibilities over banks that are members of the System,
bank holding companies, international banking facilities in
the United States, Edge Act and agreement corporations,
foreign activities of member banks, and the U.S. activities of
foreign-owned banks. The Board also sets margin
requirements, which limit the use of credit for purchasing or
carrying securities.
In addition, the Board plays a key role in assuring the
smooth functioning and continued development of the
nation's vast payments system [see Fedwire and Payment
System Risk Policy].
Another area of Board responsibility is the development and
administration of regulations that implement major federal
laws governing consumer credit such as the Truth in
Lending Act, the Equal Credit Opportunity Act, the Home
Mortgage Disclosure Act and the Truth in Savings Act [see
Consumer Information and Community Development].
Meetings
The Board usually meets several times a week. Meetings are
conducted in compliance with the Government in the
Sunshine Act, and many meetings are open to the public. If
the Board has convened to consider confidential financial
information, however, the sessions are closed to public
observation.
Contacts within Government
As they carry out their duties, members of the Board
routinely confer with officials of other government agencies,
representatives of banking industry groups, officials of the
central banks of other countries, members of Congress and
academicians. For example, they meet frequently with
Treasury officials and the Council of Economic Advisers to
help evaluate the economic climate and to discuss objectives
for the nation's economy. Governors also discuss the
international monetary system with central bankers of other
countries and are in close contact with the heads of the U.S.
agencies that make foreign loans and conduct foreign
9. financial transactions.
The Structure of the Federal Reserve
Home | About the Fed
Accessibility | Contact Us
Last update: July 8, 2003
”
I think the man that wrote the bill summed it up best:
"Whoever controls the volume of money in any country is absolute master of all industry
and commerce."(Paul Warburg, drafter of the Federal Reserve Act)
So, how did we get saddled with this non-Governmental entity made up of wealthy banks
(and the families that owned them at the time) anyway???
Woodrow Wilson was elected President as a Democrat in 1912.
The legislation was originally sponsored in 1913 by the two chairmen of House and Senate
Banking and Currency committees, Representative Carter Glass, a Democrat from Virginia
and Senator Robert Latham Owen, a Democrat from Oklahoma.
“The House, on December 22, 1913, agreed to the conference report on the Federal Reserve
Act by a vote of 298 yeas to 60 nays with 76 not voting. The Senate, on December 23, 1913,
10. agreed to it by a vote of 43 yeas to 25 nays with 27 not voting. The record shows that there
were no Democrats voting "nay" in the Senate and only two in the House. The record also
shows that almost all of those not voting on the bill had previously declared their intentions
and were paired with members of opposite intentions (See v. 51 Cong. Record, pages 1464,
1487-88).”
When the new Congress convened in 1935, there were only twenty-five Republican
senators. The Democratic Party rode roughshod over Congress in both Houses.
Yep, FDR had a New Deal for the U.S. alright. Give the control of the U.S. economy
and money supply over to the bankers in a BIGGER way.
The Banking Act of 1935 renewed and extended many of the 1933 provisions to banks
outside the Federal Reserve System. However, this act is of particular note because it finally
clarified several of the institutional tensions designed into the Federal Reserve System.
Under the act, the Federal Reserve Board became the supreme institution; it was renamed
the Board of Governors of the Federal Reserve System, and members of the Board were
given the title of "Governor," the traditional title for central bankers. In addition, the act
ended the ex officio membership of the Secretary of the Treasury and Comptroller of the
Currency on the Board. Finally, the act formally recognized the Federal Open Market
Committee (FOMC) as a separate legal entity.
The ten year terms of office of the members of the Board were
lengthened by the Banking Act of 1935 to fourteen years, which
meant that these directors of the nation’s finances, although not
elected by the people, held office longer than three presidents.
The Federal Open Market Committee (FOMC), a component of the Federal Reserve
System, is charged under U.S. law with overseeing open market operations in the United
States, and is the principal tool of US national monetary policy. (Open market operations are
the buying and selling of government securities.) The Committee sets monetary policy by
specifying the short-term objective for those operations, which is currently a target level for
the federal funds rate (the rate that commercial banks charge on overnight loans among
themselves). The FOMC also directs operations undertaken by the Federal Reserve System
in foreign exchange markets, although any intervention in foreign exchange markets is
coordinated with the U.S. Treasury, which has responsibility for formulating U.S. policies
regarding the exchange value of the dollar.
The most important policy making body of the Federal Reserve System is the Federal Open
Market Committee (FOMC). It is composed of the seven Governors, the president of the
Federal Reserve Bank of New York, and four other Reserve Bank presidents that serve on a
rotating basis. The FOMC can effect monetary policy through the use of three tools:
1. Open market operations--the buying and selling of U.S. government securities.
2. Altering reserve requirements--the amount of funds that commercial banks must
hold in reserve against deposits.
3. Adjusting the discount rate--the interest rate charged to commercial banks.
11. These tools can be used to tighten or expand the money supply. For example, if the FOMC
wanted to control inflation, it could restrict the nation's money supply by selling
government securities and raising the amount of money that banks need to set aside for
reserve requirements. Both of these actions would take money out of circulation. In theory,
a smaller supply of money would lead to less spending which would lead to lower prices.
The FOMC can also raise interest rates to help control inflation. By making money more
expensive to borrow, consumers would be more likely to save money rather than spend it.
This could also lead to lower prices.
So, what is a potential solution???
How about we REFORM the FED, huh???
EXCERPTS FROM THE SEPTEMBER 28, 2008 BROADCAST OF
“TAKE NO PRISONERS “
Dr. Sam Kennedy’s 4 Point Common Sense Economic Recovery Plan
("About all a Federal Reserve note can legally do is wipe out one debt and replace it
with itself another debt, a note that promises nothing. If anything's been paid, the
payment occurs only in the minds of the parties..." Tupper Saucy, “Miracle on Main
Street.”)
From Dr. Kennedy:
So, they tell us there’s an economic crisis. Let me ask you a question. If America has
the most powerful economy in the world, then why does it collapse upon news of a
couple of bankruptcies? Why does it collapse at the first sign of trouble? How strong
can it be if a misspoken word by the chairman of the Fed of the President can
cause a run on the banks? Do you get the feeling that something’s rotten in
Washington?
My friends, mountains last millions of years until nature whittles them down.
Mountains don’t collapse. Gold doesn’t change its properties - it’s immutable. But a
house of cards which is based upon promissory notes backed by nothing – promises
to pay nothing – empty promises disguised by statutes and regulations to look
valuable to the casual observer – then you have built a pseudo an economy that is
destined to fail. It must fail; it cannot stand forever. The inevitable end of that
economy is coming now or later, and Scripture tells us it is wise to face the pain
now.
12. An economy whose currency: Federal reserve Notes, and investments such as
bonds, stocks, mutual funds, and all of these screwy derivatives that no one
understands, consisting exclusively of arbitrary floating value assigned to
instruments of liability, where all gold and silver backing has been withdrawn by
government statutes and regulations back in 1933 (there are the Democrats again)
and 1964 (and Democrats AGAIN), is absolute insanity. It’s delusion on a frightening
scale. And that’s why the politicians who are blanketing the airwaves sound like
disinterested third parties at best, and morons at worst, when they try to analyze
the problem and are forced to admit that they do not understand it, cannot estimate
the total liability, and have no credible plan for recovery. Only an insane person
could understand the myriad layers of economic Tomfoolery. And so, we find
ourselves struggling to concoct through this bailout yet another palatable charade to
obscure from our own sensibilities that we have wandered way off course, down a
suicidal pathway, and not one among us has the courage to step forward and say
This must end or we will surely condemn our children to purgatory for the sins of
the fathers and their fathers before them.”
13. So let me ask you a couple of obvious questions.
1. Are you aware that a barrel of oil costs approximately a sixth to a tenth of an
ounce of gold – just as it has for decades? In 1974 when the price of oil shot up to
$40 a barrel after the Yom Kippur war, the price of gold also increased from $35 an
ounce to $183 an ounce. In other words, the perceived value of the dollar is all
that really changed. Did it ever occur to you that we haven’t had a gas crisis since
2003? We’ve had a dollar crisis?
2. Are you aware that in 1912, a dollar bought a steak dinner for two JUST AS IT
HAD IN 1789? You can confirm this information on the internet. For 120 years, we
experienced a natural course of slight deflation as the cost of equipment to produce
our products was paid off. Until 1913. What you’ve never been told in school or by
the media or by the endless procession of self-anointed television experts, is that
inflation is a contrived managed scheme concocted to steal your money, by men
who do not wish you good tidings. So what happened in 1913 that raised the price
of a steak dinner fifty to one hundred times? We’ll answer that in just a minute.
3. My final question is this: are you aware that the Federal Reserve Bank is a private
bank owned by a dozen banking family cartels around the world including the
Rothchild, Rockefeller and Morgan families? Here’s what the 9th circuit court said
about the Federal Reserve Bank in Lewis v United States, June 24, 1982:
".. we conclude that the [Federal] Reserve Banks are not federal ... but are
independent privately owned and locally controlled corporations... without day
to day direction from the federal government." Lewis v United States, June 24,
1982
For more information on the Fed, you might consider ordering “The Money Masters”
on DVD, or read Tupper Saucy’s miraculous “Miracle on Main Street” which you can
order at Amazon.com.
What happened in 1913? Congress passed the Federal Reserve Act in the dead of
night, giving this private bank the power to print our money at a cost of four
cents per bill which it uses to buy Treasury securities. Let’s say the Fed prints ten,
one thousand dollar bills at a total cost of forty cents which it uses to purchase a ten
thousand dollar Treasury bond. When the bond matures, the Fed returns the bond
to the United States and the United States pays the Fed the ten thousand dollar face
value. That’s right. The Fed collects ten thousand dollars on a forty cent investment -
twenty-five thousand percent interest on a forty cent investment. Now multiply
that by the billions of dollars in money the Fed prints every year. Those Treasury
securities comprise the bulk of the nine trillion dollars in public debt you read
about in the papers that the United States owes. Money conveniently owed to the
banking cartels for the privilege of printing our money. That’s what happened in
1913.
14. Something else happened in 1913. Congress passed the income tax act of 1913 to
pay the interest to the Fed for America becoming an instant debtor nation at the
stroke of a pen.
(The commentary below has been added. The remaining article continues below)
Income Tax of 1913
In his inaugural address in March 1913, newly elected Democratic President Woodrow
Wilson quickly took advantage of a new amendment to the U.S. Constitution, by calling for
tariff reduction and the adoption of an income tax. Within a month, during an emergency
session of Congress, House Ways and Means Chair Oscar Underwood, a Democrat from
Alabama, introduced a tariff reform bill that provided for an income tax with progressive
rates. Underwood and the income tax section's principal drafter, Representative Cordell
Hull of Tennessee, had originally sought to introduce a flat rate income tax to ensure
judicial approval, but pressure from other Democrats, including future Vice-President
John Nance Garner of Texas, led them to opt for the graduated rates.
The ensuing debates over the income tax primarily centered on the rate and exemption
amount for an income tax, rather than the propriety of the income tax itself. Regular
Republicans pushed for flatter rates and lower exemptions. Since they did not concede
that the tariff was itself a tax, they viewed any exemption to the income tax to be class
legislation and, in the words of Michigan Senator Charles E. Townsend, a "danger to the
Republic." When combined with progressive rates, Senator Henry Cabot Lodge of
Massachusetts argued, the exemption would "set a class apart and say they are to be
pillaged, their property is to be confiscated."
Insurgents and members of the newer Progressive party saw the income tax very
differently from Republicans. They advocated steeply progressive rates as a method of
redistributing wealth. In the most extreme example, Representative Ira Copley proposed
an income tax with a top marginal rate of 68 percent on incomes exceeding one million
dollars. Others, such as Senator Robert La Follette of Wisconsin, proposed rates as high as
11 percent to reach what he called the "menace" of "great accumulation of wealth."
Standing between these two extremes were the Democrats, who proposed a more mild
progression of rates to offset the burden of tariff taxes on the poor. Senator John Sharp
Williams from Mississippi, one of the Democratic caucus's spokesmen in the Senate,
rebuked the Insurgent and Progressive position by stating "[n]o honest man can make war
upon great fortunes per se.... I am not going to make this tariff bill a great panacea for all
the inequalities of fortune existing in this country." Nevertheless, he recognized that a
modicum of progressivity, accompanied by a high exemption, was necessary as long as
tariff taxes remained in place. According to Williams, the regular Republicans' plea for flat
rates and low exemptions should be left for "when the good day comes—the golden day—
when there will be no taxes upon consumption at all."
15. The Democrats' position carried the day. The Underwood/Simmons Tariff Act, which went
into effect on October 3, 1913, levied an income tax that imposed mildly progressive rates
and was accompanied by a healthy exemption. The graduated rate feature was later
challenged, but the Supreme Court upheld it in Brushaber v. Union Pacific R.R. Co. (1916) on
the ground that it did not "transcend the conception of all taxation" so as "to be a mere
arbitrary abuse of power."
Although the income tax act of 1913 instituted only mild progressivity and raised a
relatively small amount, it was still a monumental development. It began the process
of converting the tax system from a regressive consumption-based system to a system
that levied taxes based on the ability to pay. Moreover, it offered the vehicle
for a rapid expansion of the tax system during World War I
(1914–1918) when consumption taxes proved inadequate. It
was not until World War II (1939–45), however, when Congress
permitted payroll deduction and a significant cut in the
exemption, that the income tax truly became a tax for all
people. Nevertheless, it was in the income tax act of 1913 that
the seeds were planted for this development.
(back to the article quoted above)
According to the grace commission report submitted to Ronald Regan in 1984:
“With two-thirds of everyone's personal income taxes wasted or not collected,
100 percent of what is collected is absorbed solely by interest on the Federal
debt and by Federal Government contributions to transfer payments. In other
words, all individual income tax revenues are gone before one nickel is spent on
the services which taxpayers expect from their Government.” J. Peter Grace, Cover
letter, Grace Commission Report, January 12, 1984
Let me read to you from a speech made to Congress by Republican Congressman
Louis McFadden, chairman of the House Banking and Currency committee in 1934
after FDR engineered a government confiscation of all private wealth using tactics
similar to the strong-arming of the present Paulson bailout. McFadden brought
formal charges against the Board of Governors of the Federal Reserve Bank system,
the Comptroller of the Currency and the Secretary of Treasury for conspiracy, fraud,
conversion and treason:
"Mr. Chairman, we have in this Country one of the most corrupt institutions the
world has ever known. I refer to the Federal Reserve Board and the Federal
Reserve Banks. The Fed has cheated the Government of these United States and
the people of the United States out of enough money to pay the Nation's debt
several times over.
"This evil institution has impoverished and ruined the people of these United
16. States, has bankrupted itself, and has practically bankrupted our Government. It
has done this through the defects of the law under which it operates, through
the maladministration of that law by the Fed and through the corrupt practices
of the moneyed vultures who control it.
"Some people think that the Federal Reserve Banks are United States
Government institutions. They are private monopolies which prey upon the
people of these United States for the benefit of themselves and their foreign
customers; foreign and domestic speculators and swindlers; and rich and
predatory money lenders. In that dark crew of financial pirates there are those
who would cut a man's throat to get a dollar out of his pocket; there are those
who send money into states to buy votes to control our legislatures; there are
those who maintain International propaganda for the purpose of deceiving us
into granting of new concessions which will permit them to cover up their past
misdeeds and set again in motion their gigantic train of crime.
"These twelve private credit monopolies were deceitfully and disloyally foisted
upon this Country by the bankers who came here from Europe and repaid us our
hospitality by undermining our American institutions. Those bankers took
money out of this Country to finance Japan in a war against Russia. They created
a reign of terror in Russia with our money in order to help that war along. They
instigated the separate peace between Germany and Russia, and thus drove a
wedge between the allies in World War. They financed Trotsky's passage from
New York to Russia so that he might assist in the destruction of the Russian
Empire. They fomented and instigated the Russian Revolution, and placed a
large fund of American dollars at Trotsky's disposal in one of their branch banks
in Sweden so that through him Russian homes might be thoroughly broken up
and Russian children flung far and wide from their natural protectors. They
have since begun breaking up of American homes and the dispersal of American
children. "Mr. Chairman, there should be no partisanship in matters concerning
banking and currency affairs in this Country, and I do not speak with any.
Folks, the Federal Reserve Act was written in 1909 by a cartel headed by Senator
Nathan Aldrich, grandfather to the wife of John D. Rockefeller the second. At that
secret meeting, Aldrich gave the United States twenty years to pay its debts from the
Civil and Revolutionary Wars, and appointed a receiver to oversee collection of the
debt if the United States defaulted, which was inevitable in light of their ability to
contrive limitless liability. The receiver for the debt was the Federal Reserve Bank,
and the trustee of the receivership was the Secretary of the Treasury. So let’s not be
surprised that twenty years later, all the gold was moved out of U.S. banks into the
hands of the Fed, during the so-called Great Depression, giving a pretext to FDR,
whose family by the way owned German bonds, to issue executive order 6102,
ordering all privately held gold – your family’s gold other than jewelry and $100
– to be turned in to a Federal Reserve Bank branch near you in return for
worthless pieces of paper backed by nothing.
17. That’s when the house of cards began. FDR also ram-
rodded through Congress the Emergency Banking Act
under contrived “emergency” conditions similar to
today’s “crisis,” without providing Congress with a
copy of the bill, and permanently facilitating the
takeover of all wealth in the united States by the
Federal Reserve Bank. If I sound crazy, then why does your deed call you
a tenant? Have you ever asked your attorney?
And now you know why Henry Paulson, Secretary of the Treasury, trustee for the
bankruptcy, the man who is generally recognized as architect of mortgage
derivatives when he was Chairman of Goldman Sachs – the only Wall Street
brokerage house which was unmolested by the mortgage meltdown - shamelessly
(which is how they always operate), outrageously demands seven hundred billion
dollars for a so-called bailout. And where will that money come from? Paulson’s plan
calls for Treasury to borrow the money by issuing Treasury bonds. And who is likely
to buy them up? The Fed, with freshly printed money. The Treachery Secretary’s
plan for your economic welfare calls for a transfer of an addition $700 billion dollars
to the Fed. As in 1933, a crisis manufactured in whole by the Fed is being used to
consolidate it’s wealth and subjugate the people into dependency through poverty.
Wake up America. It’s happening again. Right under your nose. You’re asleep at the
wheel and your children are being left scraps on the table if they’re lucky to have a
table. All last week, the pundits were asking: what’s the alternative? We have to do
something! And…we…can. A single stroke of the pen on a one page “bill.” We can
eliminate the so called credit crisis as if it never happened, restore the economy to
vibrancy and legitimacy, restore permanent value to our money, return dignity and
independence to the American people, and while we’re at it, return gas prices to the
pre-1973 levels. One page. One stroke. The solution could not be more obvious to
any who will take the time to look.
Number 1. Repeal the Federal Reserve Act of 1913. Return the printing and minting
of money to the people. This one move will instantly wipe out nine trillion (or so)
dollars in debt and provide immediate liquidity and solvency. America will return to
being a creditor nation.
Number 2. Confiscate the assets of the Fed Reserve Bank, all of its gold, it’s buildings,
fixtures, notes and fickle securities. The country will be instant restored to pre-
eminence, flush in enough capital to replace our currency with currency backed by
gold and silver. All the Feds security interests in the American people will be
instantly satisfied The United States will hold no paper on its creators. Americans
will become instant owners of their own homes, cars and businesses. All
outstanding foreign debts will be satisfied. The assets of the banking cartels include
most of the assets of the world at large. The only debts that will not be forgiven are
the debts incurred by the Federal Reserve Bank and the World Bank to the people
for having stolen their property for 107 years.
18. Number 3. Repeal the Income Tax Act of 1913 and IRS. This one step will end the
tyranny, restore dignity to the American people, and immediately restore hundreds
of dollars a week to most people’s paychecks. The need to have four, five and six
jobs per family will end. We will have the time and assets to restore our families and
enjoy their lives instead of working until we drop, shopping on Sunday, and hunting
for bargains. The vast sums of money paid to accountants and attorneys will stay in
our pockets. The vast amount of time spent in the deviant calculations of the tax
code under the point of a gun will end. And perhaps America can once again be
respected around the world.
Number 4. Forgive the members of the Federal Reserve Board, the complicit
politicians, and the banking families for their inhumanity for their crimes against
mankind. Instead, we will confiscate their mansions, their yachts, their holdings,
assets and possessions after proper civil trials or pursuant to statute. We will rely
on the will of the people to shame their treason publicly and turn them into pariahs
around the world until they confess their sins and ask for forgiveness. In this way,
we will bring rapid closure, testify to our high intentions, and remain true to the
Word of the Creator.
Is the loss of a fraudulent stock market where value is established by speculative
gambling and greed for the stock rather than the performance of the company, not a
worthy price to instantly own your own home, car and business, be free of loan
payments, restore your paycheck, and bring truth back to your economy? If the
answer is yes, then we should circulate this message during this time of contrived
crisis, using the awesome power of the internet as a bulwark against tyranny by
governments and the bankers who control them.
Thank you for reading.
_________________________________________
History’s most important quotations:
"Whoever controls the volume of money in any country is absolute master of all
industry and commerce."
President James A. Garfield
"I believe that banking institutions are more dangerous to our liberties than
standing armies.”
- Thomas Jefferson
19. "Give me control over a nation's currency and I care not who makes its laws"
- Baron M.A. Rothschild (1744 - 1812)
"when you or I write a check there must be sufficient funds in our account to cover
that check, but when the Federal Reserve writes a check, it is creating money".
-Boston Federal Reserve Bank in a publication titled "Putting It Simply"
"We make money the old fashioned way. We print it".
-Art Rolnick, former Chief Economist, Minneapolis Federal Reserve Bank
"History shows that the money changers have used every form of abuse, intrigue,
deceit and violent means possible to maintain control over governments by
controlling the money and the issuance of it."
President James A. Madison
"... You are a den of vipers and thieves. I intend to rout you out, and by the grace of
the Eternal God, will rout you out".
-President Andrew Jackson, upon evicting a delegation of international bankers
from the Oval Office
"If the American people ever allow private banks to control the issue of their
currency first by inflation and then by deflation, the banks and corporations that
will grow up around them will deprive the people of all property until their children
will wake up homeless on the continent their fathers conquered".
-Thomas Jefferson in 1802 in a letter to then Secretary of the Treasury, Albert
Gallatin
20. "... the privilege of creating and issuing money... is the government's greatest
creative opportunity... [saving] the taxpayers immense sums of money...".
-Abraham Lincoln
"Of all contrivances for cheating the laboring classes of mankind, none has been
more effective than that which deludes them with paper money".
- Daniel Webster
"All the perplexities, confusion and distress in America rise, not from defects in their
Constitution or Confederation, not from want of honor or virtue, so much as from
downright ignorance of the nature of coin, credit and circulation".
-John Adams, in a letter to Thomas Jefferson in 1787
"The money power preys on the nation in times of peace, and conspires against it in
times of adversity. It is more despotic than monarchy, more insolent than autocracy,
more selfish than bureaucracy. It denounces, as public enemies, all who question its
methods or throw light upon its crimes."
Abraham Lincoln
"I see in the near future a crisis approaching. It unnerves me and causes me to
tremble for the safety of my country... the Money Power of the country will endeavor
to prolong its reign"' by working upon the prejudices of the people, until the wealth
is aggregated in a few hands and the Republic is destroyed. I feel at this moment
more anxiety for the safety of my country than ever before, even in the midst of
war."
-Abraham Lincoln, - In a letter written to William Elkin just after the passage of the
National Banking Act of 1863 and less than five months before he was assassinated.
"Gold is still the ultimate store of wealth. It's the world's only true money. And there
isn't much of it to go around. All of it ever mined would fit into a small building - a
56 foot cube. The annual world production would fit into a 14 foot cube, roughly the
size of an ordinary living room. If each Chinese citizen were to buy just one ounce, it
would take up the annual supply for the next 200 years".
21. - Mark Nestmann, author of "How To Achieve Personal And Financial Privacy In A
Public Age
"Under the surface, the Rothschilds long had a powerful influence in dictating
American financial laws. The law records show that they were powers in the old
Bank of the United States [abolished by Andrew Jackson]".
-Gustav Myers, author of "History of the Great American Fortunes"
"If Congress has the right under the Constitution to issue paper money, it was given
to be used by themselves, not to be delegated to individuals or corporations".
- Andrew Jackson
"The few who can understand the system (Federal Reserve) will either be so
interested in its profits, or so dependent on its favors, that there will be no
opposition from that class, while on the other hand, the great body of the people,
mentally incapable of comprehending the tremendous advantages that capital
derives from the system, will bear its burdens without complaint and perhaps
without even suspecting that the system is inimical to their interests".
- John Sherman, protege of the Rothschild banking family, in a letter sent in 1863 to
New York Bankers, Morton, and Gould, in support of the then proposed National
Banking Act
".. we conclude that the [Federal] Reserve Banks are not federal ... but are
independent privately owned and locally controlled corporations... without day to
day direction from the federal government."
- 9th Circuit Court in Lewis vs United States, June 24, 1982
22. "Some people think the Federal Reserve Banks are US government institutions They
are not... they are private credit monopolies which prey upon the people of the US.
for the benefit of themselves and their foreign and domestic swindlers, and rich and
predatory money lenders. The sack of the United States by the Fed is the greatest
crime in history. Every effort has been made by the Fed to conceal its powers, but
the truth is the Fed has usurped the government. It controls everything here and it
controls all our foreign relations. It makes and breaks governments at will".
-Congressman Louis McFadden, Chairman, House Banking and Currency Committee,
June 10, 1932
"This is a staggering thought. We are completely dependent on the commercial
Banks. Someone has to borrow every dollar we have in circulation, cash or credit. If
the Banks create ample synthetic money we are prosperous; if not, we starve. We
are absolutely without a permanent money system. When one gets a complete grasp
of the picture, the tragic absurdity of our hopeless position is almost incredible, but
there it is. It is the most important subject intelligent persons can investigate and
reflect upon. It is so important that our present civilization may collapse unless it
becomes widely understood and the defects remedied very soon."
-Robert Hemphill, Credit manager of Federal Reserve Bank in Atlanta.
"Historically, the United States has been a hard money country. Only [since 1913]
has the United States operated on a fiat money system. During this period, paper
money has depreciated over 87%. During the preceding 140 year period, the hard
currency of the United States had actually maintained its value. wholesale prices in
1913... were the same as in 1787".
-Kenneth Gerbino, former chairman of the American Economic Council
"About all a Federal Reserve note can legally do is wipe out one debt and replace it
with itself another debt, a note that promises nothing. If anything's been paid, the
payment occurs only in the minds of the parties...".
- Tupper Saucy, author of" The Miracle On Main Street"
23. "By a continuing process of inflation, governments can confiscate, secretly and
unobserved, an important part of the wealth of their citizens. There is no subtler, no
surer means of overturning the existing basis of society than to debauch the
currency. The process engages all the hidden forces of economic law on the side of
destruction, and does it in a manner which not one man in a million is able to
diagnose".
- John Maynard Keynes, economist and author of "The Economic Consequences Of
The Peace"
"Inflation has now been institutionalized at a fairly constant 5% per year. This has
been determined to be the optimum level for generating the most revenue without
causing public alarm. A 5% devaluation applies, not only to the money earned this
year, but to all that is left over from previous years. At the end of the first year, a
dollar is worth 95 cents. At the end of the second year, the 95 cents is reduced again
by 5%, leaving its worth at 90 cents, and so on. By the time a person has worked 20
years, the government will have confiscated 64% of every dollar he saved over those
years. By the time he has worked 45 years, the hidden tax will be 90%. The
government will take virtually everything a person saves over a lifetime".
- G. Edward Griffin, historian and author of "The Creature From Jekyll Island"
"The real truth of the matter is, and you and I know, that a financial element in the
large centers has owned the government of the US. since the days of Andrew
Jackson. History depicts Andrew Jackson as the last truly honorable and
incorruptible American president".
- President Franklin Delano Roosevelt, November 23, 1933 in a letter to Colonel
Edward Mandell House
"...our system of credit is concentrated... in the hands of a few men... a power so
organized, so subtle, so watchful, so interlocked, so complete, so pervasive, that [we
had] better not speak above [our] breath when [we] speak in condemnation of it ...
We have come to be ... completely controlled... by ... small groups of dominant men".
-President Woodrow Wilson
24. "The Founding Fathers of this great land had no difficulty whatsoever
understanding the agenda of bankers, and they frequently referred to them and
their kind as, quote, 'friends of paper money. They hated the Bank of England, in
particular, and felt that even were we successful in winning our independence from
England and King George, we could never truly be a nation of freemen, unless we
had an honest money system. Through ignorance, but moreover, because of apathy,
a small, but wealthy, clique of power brokers have robbed us of our Rights and
Liberties, and we are being raped of our wealth. We are paying the price for the
near-comatose levels of complacency by our parents, and only God knows what
might become of our children, should we not work diligently to shake this country
from its slumber! Many a nation has lost its freedom at the end of a gun barrel, but
here in America, we just decided to hand it over voluntarily. Worse yet, we paid for
the tyranny and usurpation out of our own pockets with "voluntary" tax
contributions and the use of a debt-laden fiat currency!".
-Peter Kershaw, author of the 1994 booklet "Economic Solutions"
Since I entered politics, I have chiefly had men's views confided to me privately.
Some of the biggest men in the U.S., in the field of commerce and manufacturing, are
afraid of somebody, are afraid of something. They know that there is a power
somewhere so organized, so subtle, so watchful, so interlocked, so complete, so
pervasive, that they had better not speak above their breath when they speak in
condemnation of it."
Woodrow Wilson - In his book entitled The New Freedom (1913)
"The fact is that there is a serious danger of this country becoming a pluto-
democracy; that is, a sham republic with the real government in the hands of a small
clique of enormously wealthy men, who speak through their money, and whose
influence, even today, radiates to every corner of the United States."
William McAdoo - President Wilson's national campaign vice-chairman, wrote in
Crowded years (1974)
25. "The powers or financial capitalism had (a) far-reaching aim, nothing less than to
create a world system of financial control in private hands able to dominate the
political system of each country and the economy of the world as a whole. This
system was to be controlled in a feudalist fashion by the central banks of the world
acting in concert, by secret agreements arrived at in frequent meetings and
conferences. The apex of the systems was to be the Bank for International
Settlements in Basel, Switzerland, a private bank owned and controlled by the
world's central banks which were themselves private corporations. Each central
bank...sought to dominate its government by its ability to control Treasury loans, to
manipulate foreign exchanges, to influence the level of economic activity in the
country, and to influence cooperative politicians by subsequent economic rewards
in the business world."
Prof. Carroll Quigley in his book Tragedy and Hope
"In a small Swiss city sits an international organization so obscure and
secretive....Control of the institution, the Bank for International Settlements, lies
with some of the world's most powerful and least visible men: the heads of 32
central banks, officials able to shift billions of dollars and alter the course of
economies at the stroke of a pen."
Keith Bradsher of the New York Times, August 5, 1995
"Banking was conceived in iniquity and was born in sin. The Bankers own the earth.
Take it away from them, but leave them the power to create deposits, and with the
flick of the pen they will create enough deposits to buy it back again. However, take
it away from them, and all the great fortunes like mine will disappear and they
ought to disappear, for this would be a happier and better world to live in. But, if
you wish to remain the slaves of Bankers and pay the cost of your own slavery, let
them continue to create deposits."
Sir Josiah Stamp - President of the Bank of England in the 1920's, and the second
richest man in Britain.
"The Federal Reserve Bank of New York is eager to enter into close relationship
with the Bank for International Settlements....The conclusion is impossible to escape
that the State and Treasury Departments are willing to pool the banking system of
Europe and America, setting up a world financial power independent of and above
the Government of the United States....The United States under present conditions
will be transformed from the most active of manufacturing nations into a consuming
and importing nation with a balance of trade against it."
Rep. Louis McFadden - (Chairman of the House Committee on Banking and
26. Currency) quoted in the New York Times (June 1930)
"(The Great Depression resulting from the Stock Market crash) was not
accidental. It was a carefully contrived occurrence....The international bankers
sought to bring about a condition of despair here so they might emerge as
rulers of us all."
Rep. McFadden testified in Congress (1933). There were at least two attempts on his
life by gunfire. He died of suspected poisoning after attending a banquet.
"The Federal Reserve (Banks) are one of the most corrupt institutions the world has
ever seen. There is not a man within the sound of my voice who does not know that
this Nation is run by the International Bankers."
Rep. Louis McFadden
"Nothing did more to spur the boom in stocks than the decision made by the New
York Federal Reserve bank, in the spring of 1927, to cut the rediscount rate.
Benjamin Strong, Governor of the bank, was chief advocate of this unwise measure,
which was taken largely at the behest of Montagu Norman of the Bank of
England....At the time of the Banks action I warned of its consequences....I felt that
sooner or later the market had to break."
Money baron Bernard Baruch in Baruch: The Public Years (1960)
"Thus corporations finally claimed the full rights enjoyed by individual citizens
while being exempted from many of the responsibilities and liabilities of citizenship.
Furthermore, in being guaranteed the same right to free speech as individual
citizens, they achieved, in the words of Paul Hawken, 'precisely what the Bill of
Rights was intended to prevent: domination of public thought and discourse.' The
subsequent claim by corporations that they have the same right as any individual to
influence the government in their own interest pits the individual citizen against the
vast financial and communications resources of the corporation and mocks the
constitutional intent that all citizens have an equal voice in the political debates
surrounding important issues."
David C. Korten, in his book, When Corporations Rule the World
27. "Give me control over a man's economic actions, and hence over his means of
survival, and except for a few occasional heroes, I'll promise to deliver to you men
who think and write and behave as I want them to."
Benjamine A. Rooge
" The Federal Reserve Bank is nothing but a banking fraud and an unlawful crime
against civilization. Why? Because they "create" the money made out of nothing, and
our Uncle Sap Government issues their "Federal Reserve Notes" and stamps our
Government approval with NO obligation whatever from these Federal Reserve
Banks, Individual Banks or National Banks, etc.
H.L. Birum, Sr. American Mercury, August 1957, p. 43
"I consider the foundation of the Constitution as laid on this ground that "all powers
not delegated to the United States by the Constitution, nor prohibited by it to the
states, are preserved to the states or to the people.
" ... To take a single step beyond the boundaries thus specially drawn around the
powers of Congress is to take possession of a boundless field of power, no longer
susceptible of any definition. The incorporation of a bank, and the powers assumed
by this bill (chartering the first Bank of the United States), have not, been delegated
to the United States by the Constitution."
Thomas Jefferson - in opposition to the chartering of the first Bank of the United
States (1791).
"This is a staggering thought. We are completely dependent on the commercial
Banks. Someone has to borrow every dollar we have in circulation, cash or credit. If
the Banks create ample synthetic money we are prosperous; if not, we starve. We
are absolutely without a permanent money system. When one gets a complete grasp
of the picture, the tragic absurdity of our hopeless position is almost incredible, but
there it is. It is the most important subject intelligent persons can investigate and
reflect upon. It is so important that our present civilization may collapse unless it
becomes widely understood and the defects remedied very soon."
-Robert Hemphill, Credit manager of Federal Reserve Bank in Atlanta.
Well. It is clear that although there has been corruption and blame enough to go
around on BOTH sides of the isle; the Democratic Party has carried the day over a
period of decades with regard to specific watershed Acts of Congress & Presidents
that have resulted in the rights of individuals being overtaken by big impersonal
Government, and the money of the very People of the United States & the Treasury
of the U.S. Government being literally given over to private banking institutions.
28. It is incredibly ironic that although the Democratic Party has creatively obtained the
reputation of being the “Party of the People” that they themselves, apparently with
full knowledge, have been the agents of having sold the American system into the
hands of the very wealthy.
Another email sent to us, written by an associate:
“Hi Gregg,
Just a new highlight on the bank saving program bail out plan.
Ted
China police here to foreclose property to recover losses:
Russian economists are expressing shock today over a new United States law that
will allow for the first time in that nation’s history the police forces of a foreign
Nation to have law enforcement powers over their citizens.
These powers are specifically being granted to China’s State Security Police who
operate under the Ministry of State Security for the Peoples Republic of China by the
United States as a precondition for the Chinese Governments continued purchasing
of US debt as the Americans continue their desperate actions to avert their total
economic collapse.
China had previously ordered its banks to halt all lending to the United States, an
action that would totally cripple the American banking system, and as we can read
as reported by the Reuters News Service:
“Chinese regulators have told domestic banks to stop interbank lending to U.S.
financial institutions to prevent possible losses during the financial crisis, the South
China Morning Post reported on Thursday.
The Hong Kong newspaper cited unidentified industry sources as saying the
instruction from the China Banking Regulatory Commission (CBRC) applied to
interbank lending of all currencies to U.S. banks but not to banks from other
countries.
"The decree appears to be Beijing's first attempt to erect defenses against the
deepening U.S. financial meltdown after the mainland's major lenders reported
billions of U.S. dollars in exposure to the credit crisis," the SCMP said.”
Not being understood by the American people is that China is the holder of over $1.4
Trillion of US debt backed by the mortgages on the homes and property of tens of
millions these people which, in essence, makes the Chinese one of the largest
holders of land in the United States, and which the Chinese government has stated
they will protect ‘at all costs’.
In rapid response to China’s demands that they be granted immediate access to their
American properties to protect their ‘investments’, the United States is enacting a
29. new law titled the Emergency Economic Stabilization Act of 2008, and which in
Section 101, Paragraph 7:3 chillingly states:
“Designating financial institutions as financial agents of the Federal
Government, and such institutions shall perform all such reasonable duties
related to this Act as financial agents of the Federal Government as may be
required.”
The United States Federal Reserve has further notified the China Development
Bank, the second largest bank in Asia and the main holder of US mortgage debt
instruments, that they will be designated by the US Secretary of the Treasury as
one of the financial institutions protected by this extraordinary new law, and
which, according to these reports, will empower Chinese policing authorities the
right to act as law enforcement officers in the United States including granting
them the right to evict American citizens from homes whose mortgage debt is
held by China.
Unfortunately for these American people, their own public officials have totally
abandoned them as the American Center for Responsive Politics has reported that
the staggering amount of $2 Billion has been paid by the perpetrators of this Global
financial crisis to US Lawmakers, of both political parties, to sell out their fellow
countrymen as virtual economic slaves to the all powerful International corporate
cartels who now rule over them.
Even worse for these people is that the plan instituted and carried out over these
past 40 years to erase their true history leaves virtually none of them today with the
full, and monstrous, century old plan to destroy their Nation, and which began with
almost the exact same economic crisis they are experiencing today, and was called
the Panic of 1907, and of which we can read:
“The Panic of 1907, also known as the 1907 Bankers' Panic, was a financial crisis
which occurred in the United States when the stock market fell close to 50% from its
peak in the previous year. At the time the economy was in recession and there were
numerous runs on banks and trust companies. The panic's primary cause was a
retraction of loans by a number of banks in New York City, and the sentiment
quickly spread across the nation leading to the closures of both state and local banks
and businesses.”
So shocked were the American people by the Panic of 1907 that they allowed for
the first time since their Nations founding, their lawmakers to begin the process
of establishing a Central Banking System, and of which one of their founding
fathers, and writer of the Declaration of Independence, Thomas Jefferson,
warned all future generations of Americans:
“The central bank is an institution of the most deadly hostility existing against
the Principles and form of our Constitution. I am an Enemy to all banks
discounting bills or notes for anything but Coin. If the American People allow
private banks to control the issuance of their currency, first by inflation and
then by deflation, the banks and corporations that will grow up around them
will deprive the People of all their Property until their Children will wake up
30. homeless on the continent their Fathers conquered.”
Today, and sadly, the World is now witnessing these prophetic words of Thomas
Jefferson coming true.
Even worse, these American people, whose ancestors laid the foundation for what
was once the greatest and freest Nation on Earth, have now been reduced to what is
now commonly referred to as “sheeple”, “a term of disparagement, a portmanteau
created by combining the words "sheep" and "people." It is often used to denote
persons who acquiesce to authority, and thus undermine their own human
individuality. The implication of sheeple is that as a collective, people believe
whatever they are told, especially if told so by authority figures, without
processing it to be sure that it is an accurate representation of the real world
around them.”
It goes without saying, of course, that these Americans do not see themselves in this
most truest of lights as they continue living their lives in near total ignorance of the
greater catastrophes soon to befall them, all of which they have been, and are
continued to be, warned about. But, they continue to laugh off, and spurn, these
warnings as they continue to believe the lies being fed them by their propaganda
media organs they never seem to realize are nothing but the mouthpieces for the
fascist corporate forces delivering them to the slaughterhouses they will come to
know all too soon.
[Ed. Note: The United States government actively seeks to find, and silence, any and
all opinions about the United States except those coming from authorized
government and/or affiliated sources, of which we are not one. No interviews are
granted and very little personal information is given about our contributors, or their
sources, to protect their safety.]”
Congressional Attempts to Control the Fed
In 1937, Rep. Charles G. Binderup of Nebraska, realizing the consequences of the Federal Reserve
System, called for the Government to buy all the stock, and to create a new Board controlled by
Congress to regulate the value of the currency and the volume of bank deposits, thus eliminating
the Fed's independence. He was defeated for re-election. Others have also tried to introduce various
Bills to control the Federal Reserve: Rep. Goldborough (1935), Rep. Jerry Voorhis of California
(1940, 1943), Sen. M. M. Logan of Kentucky, and Rep. Usher L. Burdick of North Dakota .
Rep. Wright Patman of Texas (who was the House Banking Chairman until 1975), said in 1952:
"In fact there has never been an independent audit of either the twelve banks of the Federal
Reserve Board that has been filed with the Congress ... For 40 years the system, while freely using
the money of the government, has not made a proper accounting."
Patman said that the Federal Open Market Committee (who, in addition to the Board of Governors,
31. decides the country's monetary policy) is "one of the most secret societies. These twelve men
decide what happens in the economy ... In making decisions they check with no one -- not the
President, not the Congress, not the people."
Patman also said:
"In the United States we have, in effect, two governments ... We have the duly constituted
Government ... Then we have an independent, uncontrolled and uncoordinated government in the
Federal Reserve System, operating the money powers which are reserved to Congress by the
Constitution."
During his career, Patman sought to force the Fed to allow an independent audit, lessen the
influence of the large banks, shorten the terms of the Fed Governors, expose it to regular
Congressional review just like any other Federal agency, and to have only officials nominated by the
President and confirmed by Congress to be on the Federal Open Market Committee. In 1967,
Patman tried to have them audited, and on January 22, 1971, introduced H.R. 11, which would have
altered its organization, diminishing much of its power. He was later removed from the
Chairmanship of the House Banking and Currency Committee, which he held for years.
On January 22, 1971, Rep. John R. Rarick of Louisiana introduced H.R. 351: "To vest in the
Government of the United States the full, absolute, complete, and unconditional ownership of the
twelve Federal Reserve Banks." He said: "The Federal Reserve is not an agency of government. It is
a private banking monopoly." He was later defeated for re-election.
During the 1980's, Rep. Phil Crane of Illinois introduced House Resolution H.R. 70 that called for an
annual audit of the Fed (which never came to a full vote), and Rep. Henry Gonzales of Texas
introduced H.R. 1470, that called for the repeal of the Federal Reserve Act.
The Federal Reserve System has never been audited, and their meetings, and minutes of those
meetings, are not open to the public. They have repelled all attempts to be audited. In 1967, Arthur
Burns, the Chairman of the Federal Reserve, said that an audit would threaten the "independence"
of the Reserve.
The Fed in the 1970s and 1980s
In 1979, after dismissing Secretary of Treasury Michael Blumenthal, President Jimmy Carter offered
the position to American Illuminati chief David Rockefeller, the CEO of Chase Manhattan Bank, but
he turned it down [as he had previously turned down the offer from Nixon]. He also turned down
the nomination for the Chairmanship of the Federal Reserve Board.
Carter then appointed Paul Volcker as Chairman. Volcker graduated from Princeton with a degree
in Economics, and from Harvard with a degree in Public Administration. He was an economist with
the Federal Reserve Bank of New York (1952-57), worked at the Chase Manhattan Bank (1957-61),
was with the U.S. Treasury Department (1961-65), Deputy Under Secretary for Monetary Affairs
(1963-65), Under Secretary for Monetary Affairs (1969-74), and President of the New York Federal
Reserve Bank (1975-79).
When Volcker was in the Nixon Administration as the Under Secretary for Monetary Policy and
International Affairs, the executive branch official who works most closely with the Federal
Reserve, he and Treasury Secretary John Connally helped formulate the policy that took us off the
gold standard in 1971, because of the dwindling gold reserves at Fort Knox. Volcker was chosen
32. because he was the "candidate of Wall Street." He was a member of the Trilateral Commission, and
a major Rockefeller supporter.
Bert Lance, the Georgia banker and political advisor to Carter who became his Budget Director and
was later forced to resign...said that if Volcker was appointed he would be "mortgaging his re-
election to the Federal Reserve." Lance predicted that he would bring high interest rates and high
unemployment. He was confirmed by the Senate Banking Committee in August, 1979, replacing
Arthur Burns, an Austrian-born economist who was a CFR member with close ties to the
Rockefellers. Volcker was against a gold-backed dollar or gold being used as a form of currency. He
attempted to tighten the money situation in order to curb the 10% annual growth in the money
supply, and to ease the pressure of loan demand. The result [of his policy] was a dramatic increase
in interest rates, which climbed to 13.5% by September, 1979, and then soared to 21.5% by
December, 1980.
[We may speculate] that this economic decline was purposely engineered to cause the political
decline of Carter. In response to the rising interest rates, Carter said:
"As you well know, I don't have control over the Fed, none at all. It's carefully isolated from any
influence by the President or the Congress. This has been done for many generations and I think it's
a wise thing to do."
During the 1970's, many banks had left the Federal Reserve, and in December, 1979, Volcker told
the House Banking Committee that "300 banks with deposits of $18.4 billion have quit the Fed
within the past 4-1/2 years," and that another 575 of the remaining 5,480 member banks, with
deposits of $70 billion, had indicated that they intended to withdraw. He said that this would curtail
their control over the money supply, and that led Congress, in 1980, to pass the Monetary Control
Act, which gave the Federal Reserve control of all banking institutions, regardless if they are
members or not.
Even though inflation had skyrocketed to all-time highs, Reagan kept Volcker on. It was Volcker
who started the collapse of the U.S. economy.
Alan Greenspan, who became the Chairman of the Federal Reserve Board in 1987, is [also] a
member of the Council on Foreign Relations. He has a bachelor's and master's degree, and a
doctorate in Economics from New York University. He met Ayn Rand, the author of Atlas Shrugged,
in 1952 and they became friends. It is from her that he learned that capitalism "is not only efficient
and practical, but also moral." In February, 1995, the seventh increase in the interest rate, within
the period of a year, took place. This put Greenspan in the limelight, as well as the Federal Reserve.
It was very interesting how the media spin doctors churned out information that totally skirted the
issue concerning the Fed's actual role in controlling our economy.
Is it any wonder that within 15 years of the establishment of the Federal Reserve and
Federal Taxation, that the U.S. was plunged into what is known as the “Great
Depression”???
33. Republicans will probably again go unheeded:
Rep. Michael Burgess - “we are under Martial Law”
September 28th, 2008 | Breaking News, Constitutional Crisis, Economy, Federal
Reserve
By: D. H. Williams @ 4:20 PM - EST
Rep. Michael Burgess (R-TX) reports from the floor of the House that the
Republicans have been cut out of the process and called unpatriotic for not
blindly supporting the fraudulent bailout. He says the only debate has been
about what talking points to use on the American people. The most ominous
revelation is when he claims the Speaker has declared martial law.
“I have been thrown out of more meetings in this capital in the last 24 hours
than I ever thought possible, as a duly elected representative of 825,000
citizens of north Texas.” Said Congressman Burgess.
Burgess asks the Speaker of the House to post the bailout bill on the internet for
at least 24 hours instead of passing the largest piece of legislation in US
financial history in the “dark of night.”
The most frightening part of Rep. Burgess’ one-minute floor speech is when he
says, “Mr. Speaker I understand we are under Martial Law as declared by the
speaker last night.”
The “Party of the People”.
You have to hand it to the Democratic Party. Somehow, systematically, and over several
decades, the Democrats have successfully captured the minds and hearts of the American
media and duped much of the general populous into believing that they are the Party that
has the American poor and middle-class in mind; whereas the Republicans are for “big
corporations” and “the wealthy”.
As you can clearly see, from President Wilson to President Franklin Roosevelt, to President
Clinton, it has been Democratic Presidents and Congressional leaders that have taken the
American economy and banking system deeper and deeper into darkness.
34. Discussion Draft of yet unnumbered House Resolution Bill to turn your life and liberty over to
the elitist who really control this country. Think of it as the Emancipation Proclamation in
reverse.