Demise of The United States of America, An American Tragedy

Politics / US Politics Jan 04, 2010 - 12:39 AM
By: Darryl_R_Schoon

The demise of a nation is often at the hands of others; and, whereas the usual suspects are its enemies, allies and friends cannot be ruled out.

The 20th century will be remembered as the century when America became a world power. World Wars I and II would decimate the then great powers of the world, e.g. England, Germany, Russia, France, Japan, etc., leaving the US as the last nation standing—the world’s sole superpower.

At mid-century, in 1950 the US would be the world’s banker, its only creditor and repository of the greatest hoard of gold in history; but in only 20 years most of the gold would be gone, the remaining owed but never paid and the US would soon become the world’s largest debtor, a virtual deadbeat who could only pay its debts by borrowing more.

The 21st century would speed America’s decline. In the first decade, the US would launch an expensive war in Iraq then Afghanistan, further destabilizing its already heavily indebted balance sheet; and by 2009, China and Japan, its primary creditors, would significantly slow their purchases of US debt, forcing the US to begin borrowing from itself in order to continue spending what it did not have.

When the creditor of last resort is the borrower, economic fundamentals will inevitably reassert themselves.

Since the 1950s, Americans have serially and collectively blamed communists, socialists, hippies, feminists, Mexicans, environmentalists, gays, abortion, entitlements, Japan, China, etc. for their mounting problems; and, like the veritable alcoholic, the real cause of its problems is always assiduously avoided.

It is little wonder that as America’s serial enemies have come and gone, America’s problems have increased. This is because the real cause of America’s problems is not others—America’s real problem is itself.

AMERICA’S DEFACTO RECALL OF THE AMERICAN REVOLUTION

America, if measured by the lofty ideals of its birth, is a failed experiment. The US Constitution is but another reminder that written words are no protection against future transgressions, that the lessons of one generation cannot be passed on to the next and that the desire to dominate others is alive and well even in freedom’s birthplace.

I have never been able to conceive how any rational being could propose happiness to himself from the exercise of power over others.
Thomas Jefferson

America’s founding fathers warned of the dangers the young republic would face. Thomas Jefferson, perhaps the greatest of America’s forbearers, saw those dangers clearly—the greatest being banks and standing armies.

I sincerely believe… that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale.
Thomas Jefferson in a letter to John Taylor, 1816

Were armies to be raised whenever a speck of war is visible in our horizon, we never should have been without them. Our resources would have been exhausted on dangers which never happened instead of being reserved for what is really to take place.
Thomas Jefferson: 6th Annual Message, 1806

Two hundred years after Jefferson’s prescient warnings, America has both the word’s largest banking establishment and the world’s costliest standing army. It would be America itself, not its perceived enemies, who would betray the lofty ideals of the American Revolution.

As a consequence, the US is now broke and indebted beyond its ability to repay. These circumstances did not come about by accident; and although the consequences are clear, the cause is not; as those who profited by America’s fall do not want the truth known—but, until it is, the tragic decline of America will continue…and accelerate.

THE QUIET COUP

The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time.

The above words prefaced The Quiet Coup, an article in The Atlantic Magazine, May 2009, written by Simon Johnson, in 2007 and 2008 chief economist at the IMF and currently a professor of economics at MIT.

Johnson contends that a coup has occurred in America, that a financial oligarchy has taken control of the nation’s affairs and that America’s situation will soon worsen unless the power of that oligarchy is broken.

Johnson’s article is one that should be read by all; but, unfortunately, it will not as denial is preferable to the truth, especially in America where citizens would rather believe themselves free than realize they are not. Nonetheless, for those interested, Johnson’s article is at http://www.theatlantic.com/doc/200905/imf-advice.

In actuality, the financial oligarchy seized control in America long before the current crisis. The actual coup took place in 1913; and, by virtue of that coup and the consequent consolidation of its power, America’s demise was set in motion.

Almost one hundred years later, bled dry by the financial interests who seized power in 1913, America’s fall is almost complete. The coup of 1913 gave the banking interests who profited from the rise and fall of England’s empire access to the vast productivity of America; and like England before it, America’s wealth would be completely drained by the banker’s debt-based banknotes in less than a century.

BUBKES BANKNOTES AND POWER

Mao Tse-tung’s proverb, political power grows out of the barrel of a gun, may be true in certain circumstances but it is most certainly true that since 1694, global power has come from the ability of central banks such as the Bank of England to substitute capital, bubkes, i.e. credit and debt-based paper banknotes, for gold and silver and to take advantage of countries that did not.

Central banking was the secret of England’s two hundred year reign of imperialism that peaked in 1850. The revolt of England’s American colonies in 1776 was to be its only setback after the Bank of England, England’s central bank, gave the king of England the ability to wage war on credit in 1694.

The Bank of England’s ability to do so, of course, was a quid pro quo for the king’s allowing the Bank of England to issue its debt-based paper banknotes as money. The king got to wage unlimited war provided, of course, the king (and consequently the nation) repaid the Bank of England the principle and compounding interest on the sums owing.

This England was able to do as long as its empire grew. But, in 1850, England’s empire peaked. England’s trade balances went negative in the 1870s and by the end of the century England was a power in decline.

What happened next explains why America, too, is now a declining power, why America like England is indebted beyond its ability to repay, and why the US dollar has lost over 95% of its value since 1913—and will soon lose what little left remains.

THE COUP SUCCEEDS THE US SUCCUMBS

In 1913, the US was the victim of a coup that bestowed upon it the failings of a falling empire. That coup occurred when US corporate and banking interests and President Woodrow Wilson established the Federal Reserve Bank in America, a central bank owned by private bankers that would henceforth control the nation’s money supply and, ultimately, its destiny—as Thomas Jefferson had earlier warned.

The establishment of the Federal Reserve Bank in 1913 brought England’s debt-based monetary system to the US. The Federal Reserve Bank was a carbon copy of England’s central bank, the Bank of England. Central banking lies at the core of capitalism and is both its blessing and its curse. The blessing, credit, comes first and debt, its curse, comes later.

In capitalist economies, central bank debt-based banknotes circulate as capital and are treated equally as money. Capitalism, in actuality, is any economic system where capital, i.e. credit and debt, replaces savings as the primary source of economic growth.

As Jefferson noted: The art and mystery of banks....is [that] private debts, called bank notes, become active capital, and … instead of paying, they receive an interest on what they owe from those to whom they owe; for all the notes, or evidences of what they owe, which we see in circulation, have been lent to somebody on an interest which is levied again on us through the medium of commerce.

In capitalist economies, debt-based banknotes are the accepted medium of exchange, i.e. money, and through the use of such “capitalâ€