Creature of Jekyll Island -- A Talk about the the Federal Reserve System

Have some more, from Mr. Jefferson's University's website:

"That paper money has some advantages is admitted. But that its abuses also are inevitable and, by breaking up the measure of value, makes a lottery of all private property, cannot be denied. --Thomas Jefferson to Josephus B. Stuart, 1817. ME 15:113

"The trifling economy of paper, as a cheaper medium, or its convenience for transmission, weighs nothing in opposition to the advantages of the precious metals... it is liable to be abused, has been, is, and forever will be abused, in every country in which it is permitted." --Thomas Jefferson to John W. Eppes, 1813. ME 13:430

"Scenes are now to take place as will open the eyes of credulity and of insanity itself, to the dangers of a paper medium abandoned to the discretion of avarice and of swindlers." --Thomas Jefferson to Thomas Cooper, 1814. ME 14:189

"The evils of this deluge of paper money are not to be removed until our citizens are generally and radically instructed in their cause and consequences, and silence by their authority the interested clamors and sophistry of speculating, shaving, and banking institutions. Till then, we must be content to return quoad hoc to the savage state, to recur to barter in the exchange of our property for want of a stable common measure of value, that now in use being less fixed than the beads and wampum of the Indian, and to deliver up our citizens, their property and their labor, passive victims to the swindling tricks of bankers and mountebankers." --Thomas Jefferson to John Adams, 1819. ME 15:185

"Private fortunes, in the present state of our circulation, are at the mercy of those self-created money lenders, and are prostrated by the floods of nominal money with which their avarice deluges us." --Thomas Jefferson to John W. Eppes, 1813. ME 13:276

"It is a cruel thought, that, when we feel ourselves standing on the firmest ground in every respect, the cursed arts of our secret enemies, combining with other causes, should effect, by depreciating our money, what the open arms of a powerful enemy could not." --Thomas Jefferson to Richard Henry Lee, 1779. ME 4:298, Papers 2:298

"I now deny [the Federal Government's] power of making paper money or anything else a legal tender." --Thomas Jefferson to John Taylor, 1798. ME 10:65

Banking Institutions
"That we are overdone with banking institutions which have banished the precious metals and substituted a more fluctuating and unsafe medium, that these have withdrawn capital from useful improvements and employments to nourish idleness, that the wars of the world have swollen our commerce beyond the wholesome limits of exchanging our own productions for our own wants, and that, for the emolument of a small proportion of our society who prefer these demoralizing pursuits to labors useful to the whole, the peace of the whole is endangered and all our present difficulties produced, are evils more easily to be deplored than remedied." --Thomas Jefferson to Abbe Salimankis, 1810. ME 12:379

"The system of banking [I] have... ever reprobated. I contemplate it as a blot left in all our Constitutions, which, if not covered, will end in their destruction, which is already hit by the gamblers in corruption, and is sweeping away in its progress the fortunes and morals of our citizens." --Thomas Jefferson to John Taylor, 1816. ME 15:18

"The banks... have the regulation of the safety-valves of our fortunes, and... condense and explode them at their will." --Thomas Jefferson to John Adams, 1819. ME 15:224

"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 to John Taylor, 1816. ME 15:23

A National Bank
"The incorporation of a bank and the powers assumed [by legislation doing so] have not, in my opinion, been delegated to the United States by the Constitution. They are not among the powers specially enumerated." --Thomas Jefferson: Opinion on Bank, 1791. ME 3:146

"It has always been denied by the republican party in this country, that the Constitution had given the power of incorporation to Congress. On the establishment of the Bank of the United States, this was the great ground on which that establishment was combated; and the party prevailing supported it only on the argument of its being an incident to the power given them for raising money." --Thomas Jefferson to Dr. Maese, 1809. ME 12:231

"[The] Bank of the United States... is one of the most deadly hostility existing, against the principles and form of our Constitution... An institution like this, penetrating by its branches every part of the Union, acting by command and in phalanx, may, in a critical moment, upset the government. I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. What an obstruction could not this bank of the United States, with all its branch banks, be in time of war! It might dictate to us the peace we should accept, or withdraw its aids. Ought we then to give further growth to an institution so powerful, so hostile?" --Thomas Jefferson to Albert Gallatin, 1803. ME 10:437

Meeting the Banking Problem
"The monopoly of a single bank is certainly an evil. The multiplication of them was intended to cure it; but it multiplied an influence of the same character with the first, and completed the supplanting the precious metals by a paper circulation. Between such parties the less we meddle the better." --Thomas Jefferson to Albert Gallatin, 1802. ME 10:323

"In order to be able to meet a general combination of the banks against us in a critical emergency, could we not make a beginning towards an independent use of our own money, towards holding our own bank in all the deposits where it is received, and letting the treasurer give his draft or note for payment at any particular place, which, in a well-conducted government, ought to have as much credit as any private draft or bank note or bill, and would give us the same facilities which we derive from the banks?" --Thomas Jefferson to Albert Gallatin, 1803. ME 10:439

"Put down the banks, and if this country could not be carried through the longest war against her most powerful enemy without ever knowing the want of a dollar, without dependence on the traitorous classes of her citizens, without bearing hard on the resources of the people, or loading the public with an indefinite burden of debt, I know nothing of my countrymen. Not by any novel project, not by an charlatanerie, but by ordinary and well-experienced means; by the total prohibition of all private paper at all times, by reasonable taxes in war aided by the necessary emissions of public paper of circulating size, this bottomed on special taxes, redeemable annually as this special tax comes in, and finally within a moderate period." --Thomas Jefferson to Albert Gallatin, 1815. ME 14:356

"Our people... will give you all the necessaries of war they produce, if, instead of the bankrupt trash they now are obliged to receive for want of any other, you will give them a paper promise funded on a specific pledge, and of a size for common circulation." --Thomas Jefferson to James Monroe, 1815. ME 14:228

"It is literally true that the toleration of banks of paper discount costs the United States one-half their war taxes; or, in other words, doubles the expenses of every war. Now think but for a moment, what a change of condition that would be, which should save half our war expenses, require but half the taxes, and enthral us in debt but half the time." --Thomas Jefferson to John W. Eppes, 1813. ME 13:364

Commercial Banking
"The bank mania... is raising up a moneyed aristocracy in our country which has already set the government at defiance, and although forced at length to yield a little on this first essay of their strength, their principles are unyielded and unyielding. These have taken deep root in the hearts of that class from which our legislators are drawn, and the sop to Cerberus from fable has become history. Their principles lay hold of the good, their pelf of the bad, and thus those whom the Constitution had placed as guards to its portals, are sophisticated or suborned from their duties." --Thomas Jefferson to Josephus B. Stuart, 1817. ME 15:112

"Put down all banks, admit none but a metallic circulation that will take its proper level with the like circulation in other countries, and then our manufacturers may work in fair competition with those of other countries, and the import duties which the government may lay for the purposes of revenue will so far place them above equal competition." --Thomas Jefferson to Charles Pinckney, 1820. ME 15:280

"But it will be asked, are we to have no banks? Are merchants and others to be deprived of the resource of short accommodations, found so convenient? I answer, let us have banks; but let them be such as are alone to be found in any country on earth, except Great Britain. There is not a bank of discount on the continent of Europe (at least there was not one when I was there) which offers anything but cash in exchange for discounted bills." --Thomas Jefferson to John W. Eppes, 1813. ME 13:277

"No one has a natural right to the trade of a money lender, but he who has the money to lend. Let those then among us who have a moneyed capital and who prefer employing it in loans rather than otherwise, set up banks and give cash or national bills for the notes they discount. Perhaps, to encourage them, a larger interest than is legal in the other cases might be allowed them, on the condition of their lending for short periods only." --Thomas Jefferson to John W. Eppes, 1813. ME 13:277

"If the debt which the banking companies owe be a blessing to anybody, it is to themselves alone, who are realizing a solid interest of eight or ten per cent on it. As to the public, these companies have banished all our gold and silver medium, which, before their institution, we had without interest, which never could have perished in our hands, and would have been our salvation now in the hour of war; instead of which they have given us two hundred million of froth and bubble, on which we are to pay them heavy interest, until it shall vanish into air... We are warranted, then, in affirming that this parody on the principle of 'a public debt being a public blessing,' and its mutation into the blessing of private instead of public debts, is as ridiculous as the original principle itself. In both cases, the truth is, that capital may be produced by industry, and accumulated by economy; but jugglers only will propose to create it by legerdemain tricks with paper." --Thomas Jefferson to John W. Eppes, 1813. ME 13:423

"Everything predicted by the enemies of banks, in the beginning, is now coming to pass. We are to be ruined now by the deluge of bank paper. It is cruel that such revolutions in private fortunes should be at the mercy of avaricious adventurers, who, instead of employing their capital, if any they have, in manufactures, commerce, and other useful pursuits, make it an instrument to burden all the interchanges of property with their swindling profits, profits which are the price of no useful industry of theirs." --Thomas Jefferson to Thomas Cooper, 1814. ME 14:61

"Certainly no nation ever before abandoned to the avarice and jugglings of private individuals to regulate according to their own interests, the quantum of circulating medium for the nation -- to inflate, by deluges of paper, the nominal prices of property, and then to buy up that property at 1s. in the pound, having first withdrawn the floating medium which might endanger a competition in purchase. Yet this is what has been done, and will be done, unless stayed by the protecting hand of the legislature. The evil has been produced by the error of their sanction of this ruinous machinery of banks; and justice, wisdom, duty, all require that they should interpose and arrest it before the schemes of plunder and spoilation desolate the country." --Thomas Jefferson to William C. Rives, 1819. ME 15:232

"It is said that our paper is as good as silver, because we may have silver for it at the bank where it issues. This is not true. One, two, or three persons might have it; but a general application would soon exhaust their vaults, and leave a ruinous proportion of their paper in its intrinsic worthless form." --Thomas Jefferson to John W. Eppes, 1813. ME 13:426

"I am an enemy to all banks discounting bills or notes for anything but coin." --Thomas Jefferson to Thomas Cooper, 1814. ME 14:61

ME, FE = Memorial Edition, Ford Edition. See Sources.

I'm really upset that this was moved to chat!

I've carefully read this, took until now to finish, and didn't learn anything new that I haven't known for over 20 years but is something that 99.9% of the people need to understand completely that today will turn you off if you even approach the subject.

I'm still convinced that the controlers of the Fed created, manipulated, and micromanaged the depression of the 30s to steal the industrial wealth of this nation if not the world and are currently in the process of doing the same thing to steal the real estate!

About 30 years ago I took a vice president of BofA, San Francisco main headquarters, on a trip ferrying my wifes cousins sport fisher to Cabo and having long heated discussions with him about the banking and money in this country it became obvious that only the very top people within the banking industry have any idea how the system functions.

As a vice president of the bank heading the district he didn't have a clue, in the 4 days it took to complete the trip I not only gave him an education but made a believer of him.

Oh goody, I just love quotes.

The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth."

- Alan Greenspan, "Gold and Economic Freedom," 1967

Nothing like being debt free

I agree.. I guess the piece of mind does out weigh the couple percent interest earned on simple savings..

I'm really upset that this was moved to chat!

Every attempt must be made to keep the truth on the back pages.

Richard W.

So you also couldn't find any original textual source other than Der Sturmer or Pravda for the supposed quote by President Woodrow Wilson.

Congress is responsible for the nation's finances. Thomas Jefferson isn't the only US politician who was ever concerned about the public debt, it's a very public political issue. Remember the proposed Constitutional Amendment for a Balanced Budget in 1997- ?

http://www.pbs.org/newshour/bb/budget/february97/budget_2-7.html

THE BALANCED BUDGET AMENDMENT

FEBRUARY 7, 1997
TRANSCRIPT

Both Houses of Congress are set to vote on the balanced budget amendment this month. We get an update from Kwame Holman.

ELIZABETH FARNSWORTH: Now, the balanced budget amendment. Both Houses of Congress are set to vote on the constitutional amendment this month. We get an update from Kwame Holman.

KWAME HOLMAN: In his State of the Union address Tuesday night President Clinton issued the challenge everybody in Congress was expecting and almost all members are ready to accept.

PRESIDENT CLINTON: Let this Congress be the Congress that finally balances the budget. (applause)

KWAME HOLMAN: The Democrats cheered and the Republicans cheered because it looks like this could be the Congress that does balance the federal budget. But that led President Clinton to his next point, which was not accepted with quite the same enthusiasm.

PRESIDENT CLINTON: Balancing the budget requires only your vote and my signature. It does not require us to rewrite our Constitution. (applause) I believe--(applause)--I believe it is both unnecessary, unwise to adopt a balanced budget amendment that could cripple our country in time of economic crisis and force unwanted results such as judges halting Social Security checks or increasing taxes.

KWAME HOLMAN: There were hisses and groans, primarily from the Republicans, who almost unanimously support a balanced budget amendment to the Constitution. In fact, Senate Majority Leader Trent Lott made it his number one priority when the new Congress convened in January.

SEN. TRENT LOTT, Majority Leader: (January) For 28 years we’ve not had a balanced budget. And it’ll be at least probably four or five more years before we would have one. We’ve had good men and women make commitments to balanced budgets, including presidents. We’ve had laws on the books. But as a matter of fact, we think that it takes more than a plan to have a balanced budget, or an agreement to get a balanced budget. We think the constitutional requirement is absolutely essential. And it’s what I call satisfaction guaranteed.

KWAME HOLMAN: Last week the Senate Judiciary Committee approved the amendment which for the first time would make balancing the federal budget a constitutional requirement. The vote was thirteen to five, Chairman Orrin Hatch being one of the thirteen.

SEN. ORRIN HATCH, Chairman, Judiciary Committee: What we have to do is put some fiscal mechanism into the Constitution that will cause Congress to have to live within its means.

KWAME HOLMAN: But leading the opposition was Vermont’s Patrick Leahy, the committee’s ranking Democrat.

SEN. PATRICK LEAHY, (D) Vermont: We’ve had four years of declining deficits. It’s the first time in the 22 years I’ve been here we’ve had a president who submitted a budget and got it passed that’s had four years of declining deficits of either party. And the president is working with the Congress to enact a balanced budget plan. So I worry why we draft a constitutional amendment, something that we have avoided for two hundred and some odd years.

KWAME HOLMAN: Amending the Constitution will require overwhelming support. Two thirds of the House and Senate would have to approve the measure, followed by 3/4 of the states. If that, indeed, happens, the amendment, as currently written, would require a balanced federal budget by the year 2002, or two years after the states ratify it, whichever comes later. Thereafter, a 3/5 vote in both the House and Senate would be needed in order for Congress to waive the balanced budget requirement and spend more than the Treasury has and in order to raise the debt ceiling, the amount of money the government is allowed to borrow. But some Republicans and most Democrats, like Massachusetts Edward Kennedy, argue that funds designated to pay Social Security benefits should be separated from the balanced budget equation.

SEN. EDWARD KENNEDY, (D) Massachusetts: Now, Mr. Chairman, there are those that say, well, here we go again, mentioning Social Security, scaring our seniors.

KWAME HOLMAN: But Kennedy added that if Social Security isn’t excluded from the balanced budget amendment, the retirement found would be subject to the same budget cutting rules as any other government program.

SEN. EDWARD KENNEDY: And to the seniors, you’re at risk, you’re at risk, your paycheck is at risk. Your paycheck is at risk. Your retirement’s at risk. We can’t tell you now how much. We may pass enabling legislation. We’re not prepared to say even what’s going to be in that enabling legislation till after we pass this measure.

SEN. ORRIN HATCH: I would have really felt bereft if we hadn’t had some forceful arguments from Sen. Kennedy on Social Security. The fact of the matter is, is that we believe that there are thousands of items in the federal budget that are important that are included within the balanced budget amendment’s purview, none more important than Social Security, and it should be included as well.

KWAME HOLMAN: But the opposition by Kennedy and others who want to exempt Social Security makes the upcoming balanced budget amendment vote in the Senate a toss-up.

SPOKESMAN: Mr. Hatfield. Mr. Hatfield--no.

KWAME HOLMAN: It could be just as close as the vote two years ago when Oregon’s Mark Hatfield quietly but defiantly withstood the pressure of his own party and became the only Republican to vote against the balanced budget amendment. It fell one vote short of the sixty-seven needed for passage.

SPOKESMAN: 2/3 of the Senators voting not having voted in the affirmative, the joint resolution is not passed.

KWAME HOLMAN: And the situation in the House looks just as precarious. At the President’s speech Tuesday night, members talked about the amendment and its chances of passing this year. Florida Republican Bill McCollum supports the amendment.

KWAME HOLMAN: If the amendment got through the House last time around with more than a dozen votes to spare, why is it being said now that, that it’s very questionable whether the House will be able to pass this?

REP. BILL McCOLLUM, (R) Florida: I think it’s very questionable for two reasons. One is we’ve had a change in the composition of Congress. The ratio between Republicans and Democrats is closer. The pressure of the Democrat leadership and the President is much greater on the Democrat members of Congress. So the freshmen Democrats over here are going to get enormous pressure, and we already see it happening, to vote no. With the President’s speech it’s even worse.

KWAME HOLMAN: Louisiana’s John Breaux is a Democrat and amendment supporter in the Senate.

SEN. JOHN BREAUX, (D) Louisiana: The fact that the President has now proposed a balanced budget himself and has shown that it can be done without having a constitutional amendment requiring it to be done I think gives a lot of people reason to say, look, we can do it without the constitutional amendment. I happen to take the position that we need that as an extra requirement; we need that as an insurance policy that we will continue balancing, and in the future. We may have--the next president might never give one to Congress, a balanced budget. And this mechanism I think would ensure that we do it anyway.

KWAME HOLMAN: The fate of the balanced budget amendment could rest with a handful of undeclared Democrats like freshman Senator Robert Torricelli who voted for such an amendment three times during his career in the House.

SEN. ROBERT TORRICELLI, (D) New Jersey: During the Bush administration and the early Clinton administration I cast these votes as a message to each president to send balanced budgets to this Congress, restore some sense to this process. Well, that’s happened. The good news is Bill Clinton now introduced this deficit four years in a row, so the question is, is it necessary now to proceed with changing the Constitution to permanently settle an issue which largely by our annual fiscal policy has largely turned a dramatic corner.

KWAME HOLMAN: The prediction of California Democrat Vic Fazio, a member of the House Democratic leadership, is that a constitutional amendment won’t pass Congress because there will be an actual balanced budget.

REP. VIC FAZIO, (D) California: I think frankly this is not an issue two years from now. If we’ve done our job and put in place the policies in legislation, the constitutional amendment will be forgotten. The American public wants us to act. They only see the constitutional amendment as a way to force that. If we show we have the courage to do it, and not put the government into court or on automatic pilot, then I think they’ll actually respect us more, and the constitutional amendment will be seen simply as a way of bringing about what they ultimately wanted, which is the policy change.

KWAME HOLMAN: Both Houses of Congress expect to vote on the balanced budget amendment by the end of the month. Republican leaders say the chamber with the best chance of passing it will go first and thereby put pressure on the other body to do the same.

"I've an idea. Why not just refuse to pay the debt and tear up the mortgage they hold on our children?"

Here's an even better idea. Pay off the National debt, painlessly, in the process of moving to sound banking. See:

http://www.datakids.org/fm/vince.html

You are right about the Jefferson quote. The terms "inflation" and "deflation" did not come into use until long after Jefferson was dead. However, there are other Jefferson quotes that express very similar sentiments that are real. For example:

I sincerely believe that banking establishments are more dangerous than standing armies and the principle of spending money to be paid by posterity in the name of funding is but swindling futurity on a large scale.

John Adams said of bank issuances in excess of gold and silver on hand:

represents nothing and is, therefore, a cheat upon somebody.

Hi, Deuce. Happy New Year!

Yes, I read it and will read it again. Thanks for the link.

Hi, Soren. Sorry I'm late with this, but your question started me thinking in more detail about those days and decided that nothing short of an essay would be the proper response. I was talking to a couple of my old fogey friends about your question yesterday, and we decided to compare notes and start a thread. Should be interesting. I'll ping you when we get it going. Thanks, and Happy New Year!.

Sounds fascinating. I look forward to reading it.