SEPTEMBER 24
1976 – DEATH OF PAUL DOUGLAS, ECONOMIST, US SENATOR, QUAKER
A prominent University of Chicago economist, Douglas was one of several economists who developed A Program for Monetary Reform in 1939. It was sent to President Roosevelt as a proposal to end the Great Depression. More than 230 economists from 150 universities approved it without reservations while an additional 40 supported it with some reservations.
In assessing the problem of the day, the PMR states, “If the purpose of money and credit were to discourage the exchange of goods and services, to destroy periodically the wealth produced, to frustrate and trip those who work and save, our present monetary system would seem a most effective instrument to that end.” It also stated monetary systems based on a gold standard “has had…disastrous results all over the world.”
The PMR called for government creation and maintenance in the quantity of money. “Our own monetary policy should…be directed toward avoiding inflation as well as deflation, and in attaining and maintaining as nearly as possible, full production and employment.” The plan also called for eliminating fractional reserve lending – the process of banks loaning multiple the times the amount of money in their possession. Back in the 1930’s the reserved requirement was 5:1. Today it’s 9:1. Some of the major banks involved in the economic collapse of 2007 had ignored this law and were loaning out 50 times their reserves. The PMR called for a 100% reserve requirement – banks could only lend the amount of money they possessed.
The document goes on, “In early times the creation of money was the sole privilege of the kings or other sovereigns – namely the sovereign people, acting through their Government. This principle is firmly anchored in our Constitution and it is a perversion to transfer the privilege to private parties to use in their own real or presumed interest. The founders of the Republic did not expect the banks to create the money they lend.
Their plan to reduce the national debt was simply to have the government purchase government bonds with new US debt-free money.
The PMR was the outgrowth of an earlier similar proposal from many of the same economists, The Chicago Plan, which was introduced as federal legislation in 1934, as a means to end the Great Depression The Chicago Plan called for the issuance of debt-free U.S. money and the end of banks lending less that their assets as means to reduce public and private debt, eliminate bank runs, and gain control over money creation.
[NOTE: A new economic/mathematical analysis of The Chicago Plan has just been published The Chicago Plan Revisited is a working paper by two International Monetary Fund economists, Jaromir Benes and Michael Kumhoff. It affirms virtually every assertion by its advocates in the 1930’s. The paper is at
2020: “LETTER TO MAYORS FOR A GUARANTEED INCOME” FROM THE ALLIANCE FOR JUST MONEY
“We in the Alliance For Just Money (AFJM) share your goal of shrinking the wealth gap and wholeheartedly support your assertion, “We need meaningful, systemic change to our economy.” A bold monetary reform is the way to achieve that systemic change and to finance your bold call for guaranteed income.
“AFJM’s Just Money solution states, ‘The government will no longer borrow money when it spends more than it takes in as taxes and fees. Government borrowing currently costs a lot of money, namely the interest paid on the federal, state, county, and municipal debt.’
“We applaud your plans to assist the vulnerable public in facing financial and climate disruptions. It has become clear that private money creation and allocation under the Federal Reserve Banking System (FRBS) is only meant to assist the powerful elite.
“A responsible guaranteed income plan will require stable US Dollars, not the unreliable bank credit we currently depend on. Donated funds are a nice gesture for pilot programs, but a guaranteed income, over time, can only be supplied by the Federal Government, and only if federal spending is freed from debt obligations. This is not a matter of juggling appropriations.
“You will want to know about legislation already written to empower the Federal Government to issue US Dollars, free of debt like the 19th century Greenbacks were. The NEED Act 3 point reform, Just Money, will allow for the responsible funding of your program and more. We encourage Mayors for a Guaranteed Income (MGI) to review its benefits and adopt the NEED Act as your long term funding strategy.”
SEPTEMBER 25
1913 – STATEMENT OF T. CUSHING DANIEL, US LEADING MONETARY SCHOLAR BEFORE SENATE BANKING AND CURRENCY COMMITTEE
“[I]t should be born in mind that the value of the American dollar does not depend upon bankers or gold, but upon the National wealth of the United States created by the people.”
SEPTEMBER 26
1939 – DEATH OF ALFRED OWEN CROZIER, PROMINENT OHIO ATTORNEY AND AUTHOR
Crozier wrote widely against the power and influence held by Wall Street Bankers. Crozier wrote eight books, including The Magnet and U.S. Money vs. Corporation Currency, which warned the country of the replacement of the country’s currency by notes printed by private banking corporations. A wonderful display of political cartoons from his book, U.S. Money vs. Corporations Currency is at http://www.youtube.com/watch?v=q4qQ59w4ML4
1942 – STATEMENT OF REVERENT WILLIAM TEMPLE, ARCHBISHOP OF CANTERBURY, CALLING FOR THE NATIONALIZATION OF THE BANK OF ENGLAND
“The private issue of new credit should be regarded in the modern world in just the same way in which the private minting of money was regarded in earlier times. The banks should be limited in their lending power to the amount deposited by their clients, while the issue of newer credit should be the function of public authority. This is not in any way to censure the banks or bankers…But the system has become anomalous, and, so often happens when anomaly has persisted through a long period of time, the result is to make into the master what ought to be the servant.”
[NOTE: Temple’s advocacy for banks being “limited in their lending power to the amount deposited by their clients” was for the ending of “fractional reserve banking” – the common practice of financial institutions providing loans in amounts many times in excess of the actual amount held by them. This feature is one of the major components of HR 2990, The National Emergency Employment Defense Act.]
SEPTEMBER 27
2014 – ARTICLE, “‘NATIONALIZE THE FED,’ SAYS MONETARY EXPERT'” BY KEITH JOHNSON
“Few would deny that predatory bankers have been feeding off the blood and treasure of the American people for far too long. So what’s being done about it? Though many have stepped forward proposing ways to break free from this century-old system of debt slavery, perhaps no one has worked harder or come closer to an infallible escape plan than Stephen Zarlenga of the American Monetary Institute (AMI). “Congress already had the solution hand delivered to them a few years ago,” he replied. “Our work now is getting them to put it into action…
“According to Zarlenga, the solution he has helped champion can be found in the text of the National Emergency Employment Defense Act (NEED), a bill that was introduced by former Representative Dennis John Kucinich (D-Ohio) in 2011.
“’All the components for monetary reform can be found in that bill,’ Zarlenga said. ‘It essentially accomplishes three things: nationalizes the Federal Reserve, prohibits banks from deciding what we use for money and returns that power to Congress, which creates new U.S. money and spends it into circulation for the common good: infrastructure, health care and education.'”
http://americanfreepress.net/?p=19811#sthash.Axw3YByG.dpuf
SEPTEMBER 28
2008 – BANK BAILOUT BILL ANNOUNCED, FAILS NEXT DAY
The financial industry imploded in 2007 and 2008. The causes were primarily banking corporations engaging in incredibly risky loans (i.e. subprime mortgages) and too much leverage (loaning out many more times than actual assets – in some cases 30 times – called “fractional reserve” lending).
The response was a call to bail out the largest financial corporations that had the greatest amount of toxic assets (called “zombie” banks). U.S. Senate and House leaders, along with Treasury Secretary Paulson, announced a tentative deal on this day to bail out banking corporations by allowing the government to purchase up to $700 billion toxic mortgage backed securities in an effort to stabilize the banks and the financial markets. The 3-page proposal outraged the public who rightly thought it was a blank check bailout. Calls to Congress numbered more than 10:1 against the bill. Congress voted the bill down the next day.
SEPTEMBER 29
1897 – BIRTH OF GRAHAM TOWERS, GOVERNOR OF THE CENTRAL BANK OF CANADA, 1934-1955
In testimony in 1939 before a Standing Committee on Banking and Commerce of the Canadian Parliament when asked whether banks create money, he stated: “That is right. That is what they are for… That is the Banking business; just in the same way that a steel plant makes steel…The manufacturing process consists of making a pen-and-ink or typewriter entry on a card in a book. That is all…Each and every time a bank makes a loan (or purchases securities), new bank credit is created — new deposits — brand new money…As loans are debts, then under the present system all money is debt.”
1993 – LOBBY DAY ON MONETARY REFORM
Over 1000 people traveled to Washington D.C. and hand delivered petitions to the U.S. Congress calling for monetary reform. One of the authors of the measure was Byron Dale. Concerning debt, he stated: “Nobody can borrow themselves out of debt no more than you can drink yourself sober.”
2008 – U.S. STOCK MARKET CRASH
The Dow Jones plummeted by 778 points, its largest one-day drop in the history of the New York Stock Exchange. The short-term cause of the crash was the congressional vote against the black check bank bailout. More fundamentally, it was the result of the bursting of a massive housing “bubble” caused by financial institutions engaged in highly risky mortgages and other bizarre risky investments and fractional reserve lending. The elimination on controls of the financial industry a decade earlier opened the door, but was not the root cause, of the crash that has come to be known as the Great Recession. The root cause of the 2008 crash, similar to all other bursts of financial bubbles before it, was the ability of banks to issue money out of thin air as debt (loans) many times in excess of their assets. The smaller the asset base, the greater the risk that banks will go bankrupt when their loans cannot be repaid or other investments go bad.
2013 — WHY MONETARY REFORM MUST BECOME YOUR NUMBER ONE ISSUE (VIDEO)
Joe Bongiovanni discusses our monetary system and why fixing it is the single most important issue facing people and the planet. Joe explains how money is created as debt by private banks and how that system heavily favors principles and values that are in direct opposition to those who seek a more just and sustainable world. We are all playing by monetary rules that were written by our opponents. It’s a game we are bound to lose unless we change the rules.
SEPTEMBER 30
1941: FEDERAL RESERVE HEARING GOVERNOR ADMITS THEY HAVE RIGHT TO ISSUE MONEY
Congressman Patman: “How did you get the money to buy those two billion dollars worth of Government securities in 1933?” Federal Reserve Governor Eccles: “Out of the right to issue credit money.” Patman: “And there is nothing behind it, is there, except our Government’s credit?” Federal Reserve Governor Eccles: “That is what our money system is. If there were no debts in our money system, there wouldn’t be any money.” Congressman Fletcher: “Chairman Eccles, when do you think there is a possibility of returning to a free and open market, instead of this pegged and artificially controlled financial market we now have?” Federal Reserve Governor Eccles: “Never, not in your lifetime or mine.”
-Testimony of Marriner Stoddard Eccles (1890-1977) US banker, economist, and Chairman of the Federal Reserve (1934-48) before hearing of the U.S. House of Representatives Committee on Banking and Currency
2022 — VIDEO “DR. NOMI PRINS: THE FED HAS PERMANENTLY DISTORTED THE WORLD”
“Nomi explains how central banks are adversely affecting everyone on the planet. The Fed is the mothership in this global policy structure. Tensions are building between the United States and China, particularly around monetary policy. Since the financial crisis of 2008 the Fed has blown out their balance sheets with monetary easing. China had a similar policy, but they channeled that monetary energy into building up the country. As a result, they had significant growth, while in the United States the economy staggered. “
Monetary History Calendar 