G Edward Griffin Explains Our Rigged System
Stefan Molyneux and G. Edward Griffin discuss the basics of the central banking scheme, the secrecy which went into the creation of the Federal Reserve System in the United States, why central banking is important, the true nature of the income tax, the government control of currency interest rates, the erosion of market signals by government policies, the possibility of a cashless society, the similarity between the Republican/Democrat establishment and the dangers of collectivism.
G. Edward Griffin is the Founder and President of Freedom Force International, a network of men and women from all parts of the world and all walks of life who are concerned over loss of personal liberty and growth of government power. His website is: www.freedomforceinternational.org
By Pam Barker | TLB staff writer
Below is a summary of the interview
Who cares about the Federal Reserve?
We should care because it’s a cartel – it’s NOT a government agency as we typically believe. It does have the power of law behind it, which is indeed a feature of a government agency. But in 1913 when it was passed into law, they metaphorically erased the word ‘cartel’ off the title of their cartel agreement and wrote in Federal Reserve Act and took it to the idiots in Congress who thought it was a measure to control the big powerful bankers. They had no idea that it was written by the very banking interests it was apparently going to control.
Congess and the people had had central banking for some time – three times before, and were fed up of the devastating effect it had on the economy. So they got rid of it; the fourth attempt was the Federal Reserve System.
So we have a cartel of banks who got together and didn’t wait for new legislation to be implemented by those who wanted true reform – they decided to write it themselves and anticipate it. So they got together and did it entirely in secret. The bankers didn’t want people to know they were the ones creating the Federal Reserve.
A cartel is a shared monopoly among certain so-called ‘competitors’ within an industry. The giant international banking players such as JP Morgan and the Rockefellers decided not to compete with each other for domination anymore. They merely pretended to fight each other for public consumption.
The government was fooled or ‘purchased’ into transferring the right to create the nation’s money to a group of private banks. US had authority to issue its own money – all countries do – it’s a definition of sovereignty. Yet Congress gave away the power to create its own money to a group of private banks. Our money isn’t issued by the US Treasury but by the Federal Reserve system or this cartel of banks. Fast forward 100 years: if they get into trouble, Congress votes to give bailouts to banks. They say that saving the banks is saving the nation or economy, but it’s nonsense. Where does this money go? It goes back to the banks.
Third-world countries get bailed out in the name of ‘fighting terrorism’, or ‘fighting communism’ as used to be the case. What happens to the money? It goes back to the New York banks because these poor countries have loaned money from them and haven’t been able to make the interest payments. So Congress votes to give these countries the money. Well, the Federal Reserve creates the money, gives it to Congress, Congress gives it to the 3rd world country who writes a check to the New York banks for late interest payments! The whole system is rigged to do exactly that … to transfer money from the people to the banking system via the government.
It matters because American people, and now people everywhere, are being legally plundered by this system.
A private cartel can break up easily if one member breaks the ranks and decides to undercut its competitors, as so often happens. Or a new venture comes along to undercut the existing cartel. But here the entire banking cartel is protected by state power. This is the definition of monopoly capitalism vs. free market capitalism. Successful cartels obtain the power of the state to make them a entity legal, and to ensure that the government becomes the enforcement arm of the cartel.
The nature of income tax
It’s not what it appears to be. It appears to be a means of revenue for providing us with government, but we know it’s not that. The people who created it told us so. [name forgotten] He was the head of one of the branches of the Federal Reserve system after WWII. He advocated mandatory withholding of money from people’s paychecks.
The purpose is not to raise revenue, he said. It’s obviously not that because with modern banking structures, i.e. the F.R. system, we now have the means to produce money simply by printing it so we don’t need to tax people, we just create it. It’s a wonderful invention, the F.R. System. But we do need income tax to redistribute wealth and to engineer society . We need taxes to create exemptions so we can reward people and punish others. It’s the only reason for income tax.
Imagine how little control the ruling parties would have if we didn’t have income tax. Everybody complies with the rules because of the flow of tax money and the flow of tax exemptions. They are the levers they have over us. It’s subtle power exerted through economic means, not through warfare – you don’t know who the enemy is, so people just buckle under.
The huge number of rules, regulations and administrative decisions concerning income tax is so voluminous because every single one of those pages and paragraphs is in there as a loophole for a friend of the ruling class, or an enemy.
They always serve the banks in some way. They are determined by the Fed, not by the government, but the Fed is sensitive to the government’s needs because it’s a partnership we’re dealing with.
Interest rates are a means of helping the government float its debt. The federal government now lives entirely on debt. Before, most of the debt – bonds, treasury notes, etc., was being snapped up by individuals, corporations, other governments, other institutions and even central banks as a good investment. They knew that the government would strangle taxpayers to pay back the interest rates if necessary.
Before, the amount of debt the government was issuing was only picked up to the tune of 7% by the Federal Reserve. Now it’s closer to 100% because nobody wants to buy up US government debt anymore – it’s on the slippery slope to oblivion. The massive level of debt can now never be repaid.
So the money supply is expanding much more rapidly than ever before. Newly-created money is being given to the government to buy the debt, so inflation is very high.
The reason for interest rates has traditionally been to make it easy for government to push its bonds and notes onto the buyers – the public, and to keep the money supply relatively under control and thus keep inflation down. But it’s no longer possible. The expanding money supply with a relatively lower inflation rate is a mystery to many people. But it’s not.
First, the real inflation rate is not being revealed by Washington. But it’s only a small part of the deception. The world is still functioning on Federal Reserve notes, i.e. US dollars. The world still has an insatiable appetite for these worthless dollars. But people can count and read the charts. The amount of dollars being pushed out into the world economy has now become unsustabinable.
Generally the dollar is going belly up and will be rejected by the world as a reserve currency. It’s just a matter of time.
There is a malfunctioning of the free market system, which is now dead – nothing is working the way it should. We’ve evolved into a system where excellence is not determined by production or honesty. Success is only determined by political influence, by going to the legislature to get laws passed to favor your products. The price of that is passed onto the consumer in higher prices and a lot less choice. We haven’t had true capitalism here for over 50 years.
The ruling class is now engineering away the old capitalist system because it wants to throw us back into a feudalist system with a clearly recognized ruling class. We’re almost there already.
Why are we going to a cashless society?
There isn’t really a place to put money anymore where it will last and endure in value. They can’t put it anymore where it’s secure. Bail-outs or bail-ins are being prepared for us. The next round – a bail-in – means our money will be confiscated to some degree, so people will want to take their money out. Banks are going to make this impossible hence the move to cashlessness, which is simply legalized plunder. And it’s already happened in Cyprus. Our governments have already approved the bail-in model and the cashless society. It’s all in the works.
On the Political Arena Today – manifestations of collectivism
Republicans like to present themselves as opposites of the left. But we need to look under the labels and see that there is very little difference in the political philosophy of the candidates. We need to be realistic and sceptical with candidates. Left and right are just wings of the same movement – Collectivism. Until we recognize that, we can’t make an intelligent choice. We don’t have candidates who can present an authentic choice anymore. Candidates have been pre-selected by people who don’t have our best interests in mind.
It’s not fascism or communism, left or right, Democrat or Republican – the real enemy is Collectivism.
Collectivism vs. individualism
The most fundamental issue is, what is more important in society – the individual or the group? Collectivists support the group and will sacrifice the individual for the greater good of the greater number if necessary.
There is no such thing as a ‘group’ just as there is no such thing as a ‘forest’. These are just mathematical abstractions. How can an abstraction have more rights than actual individuals, actual people? The individual is the foundation of society. The greater good of the greater number is always achieved by supporting the individual.
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About the contributor
Pam Barker is a TLB staff writer/analyst. She has an extensive background in the educational system of several countries at the college and university level as a teacher and administrator