FFF: Monetary Destruction in America

Jacob G Hornberger at the Future of Freedom Foundation has a well written article detailing Monetary Destruction in America. It’s a bit of a long read, but worth the Constitutional and monetary education.

The Constitution made it crystal clear what the official money of the United States was to be when it called the federal government into existence. That money was to be gold coins and silver coins, not paper money.

Article 1, Section 10, of the Constitution, which is a restriction on the power of the states, states, “No State shall … coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts….”

What were “bills of credit”? That was the term used at that time for paper money. Through that provision in the Constitution, the Framers expressly prohibited the states from issuing paper money. It prohibited them from making anything but gold coins and silver coins legal tender or official money. It prohibited the states from issuing their own coins, leaving that power and responsibility to the federal government.

With respect to the federal government, Article 1, Section 8, states, “The Congress shall have Power …To coin Money, regulate the value thereof, and of foreign Coin…. To provide for the Punishment of counterfeiting the Securities and current Coin of the United States.”

Why wasn’t there an express prohibition on the power of the federal government to emit “bills of credit” or paper money? The reason is that the Constitution established a government of limited, enumerated powers. The federal government’s powers were limited to those listed in the Constitution. If a power wasn’t enumerated, it couldn’t be exercised. Since there was no power to issue paper money given to the federal government, it couldn’t exercise such power.

It was different with the states. Under the Constitution, they were to have whatever powers they wished to exercise, unless there was an express restriction on a particular power within the Constitution. That was why the Framers deemed it necessary to restrict the powers of the states when it came to money: no printing of paper money, no coining of money, and no making anything but gold coins and silver coins official money.

The federal government, on the other hand, was given the power to coin money, not print money, and to regulate the value of such money. It was also given the power to punish people for counterfeiting “the Securities and current Coin of the United States.”

Article 1, Section 8 of the Constitution also gave Congress the power “To borrow Money on the credit of the United States.” That’s what counterfeiting “the Securities” of the Constitution was referring to — debt instruments of the United States, such as bills, notes, and bonds.

There is something important to realize about the federal government’s debt instruments: It was understood that they were not money or “legal tender” but rather promises to pay money — i.e., promises to pay gold coins and silver coins.

When we consider all of these constitutional provisions, it is easy to see that the Framers intended to establish a monetary system in which gold coins and silver coins were to be the official money of the United States. And, in fact, that is precisely what happened after the federal government was called into existence. The Coinage Act of 1792 established the first mint in Philadelphia for the purpose of issuing coins. The silver dollar was the first unit of money issued. That would be followed by the silver half-dollar, quarter-dollar, dime, and half-dime. Gold coins consisted of the $10 gold Eagle, $5 Half-Eagle, and $2.50 Quarter-Eagle.

That gold-coin, silver-coin system remained the monetary system of the United States for more than 125 years. It turned out to be the most stable monetary system in history, one that, along with no income taxation, no welfare state, no warfare state, no immigration controls, and very few economic regulations, played an important role in the tremendous rise in economic prosperity and rising standards of living in the United States throughout the 19th and early 20th centuries.

It is often said that America’s “gold standard” was a system in which paper money was “backed by gold.” Nothing could be further from the truth. There was no paper money. There were only debt instruments promising to pay gold and silver. The system was one in which gold coins and silver coins were the official money of the United States.

Paper money

Why did our American ancestors have such a deep antipathy toward paper money? They knew that throughout history public officials had plundered and looted people through the use of paper money. To finance their ever-burgeoning expenses, public officials, of course, would first resort to tax increases. At some point, however, taxes would get so high that people would begin to resist, cheat, or, in extreme cases, violently revolt. That’s when kings and other regimes would resort to the printing press to finance their expenditures. They would simply crank up their printing presses, print whatever amount of money they needed, and go spend it.

The result would be a devaluation of everyone’s else’s money…(continues)

Click here to read the entire article at the Future of Freedom Foundation.

FFF: America Is and Has Been a Socialist Country

In Socialism in America, author Jacob Hornberger of The Future of Freedom Foundation discusses the idea that America is a preeminent socialist country and has been for some time, but Americans live in denial of this truth. There are no pure socialist countries, though North Korea comes closest, because they are doomed to failure and always require some private enterprise to be allowed in order to be taxed to fund the rest of the socialist enterprise.

Lost in the ongoing debate in America as to whether the United States should embrace socialism is a discomforting fact: America embraced socialism a long time ago. The problem is that many Americans have simply not wanted to accept that fact and instead have preferred living a life of denial.

A complete socialist system would be one in which the state owns everything in society, including businesses and real estate. In a pure socialist society, the government is the sole employer, and everyone is a government employee. No private grocery stores, computer companies, restaurants, movie theaters, or anything else. The government owns and operates everything, and everyone works for the government.

Moreover, in a pure socialist society, all the homes are owned by the state. There are no private houses or apartments for sale or rent because nothing is privately owned. Everyone lives in public housing because the state owns all the dwellings. How do people determine where they are to live? The state assigns everyone his own particular housing unit.

How does the socialist state fund all this? It owns and operates all the businesses and enterprises in the hope of generating revenues to finance its socialist system. One problem, however, is that state-owned enterprises are notorious for inefficiencies and corruption, which means that they inevitably end up losing money rather than making money. Think of Amtrak and the Postal Service. Or state-owned petroleum companies in Latin America. They produce losses, not gains, for the state.

Thus, to fund its socialist enterprises, the socialist state inevitably permits a small number of citizens to engage in private enterprise. Once those people begin making money, the state taxes them and uses the money to fund its operations. The state does its best to
extract as much money as it can from these private-sector enterprises without pushing them out of business.

There are few purely socialist countries. North Korea comes closest to the socialist ideal.

There are countries, however, that adopt programs and policies that are socialist in nature. The United States is a premier example of such countries, even though many Americans are loathe to acknowledge it. They have convinced themselves that America is a “free enterprise” country and that they themselves are “capitalists.” The last thing they want to confront is that they are living a life that embraces socialism.

Let’s examine socialism in America.

Social Security

Contrary to popular opinion, especially as held by seniors, Social Security is not a retirement program. There is no investment fund into which people place their savings for retirement. There are no lock boxes at Fort Knox labeled with each person’s name and containing his “contributions.”

Social Security is a straight socialist program, one that uses the government to take money from people to whom it belongs and gives it to people to whom it does not belong. This process of coercive redistribution of wealth is based on a principle enunciated by Karl Marx: from each according to his ability, to each according to his need. The state takes money from those who have produced it and gives it to people who are said to need it more.

For more than a century after the United States was founded, Americans lived without Social Security. The idea for this particular socialist program originated among German socialists in the late 1800s. The so-called Iron Chancellor of Germany, Otto von Bismarck, adopted it into law in Germany. The program was later imported into the United States and became a legally established program in the 1930s. Today, the U.S. Social Security Administration displays a portrait of Bismarck on its website.

From its inception, Social Security has been a straight socialist, welfare-state program, one that uses the state to forcibly take money from some and give it to others. It
is no different in principle from food stamps, education grants, farm subsidies, or other socialist programs.

Seniors have a valid point when they say that the state plundered and looted them throughout their work lives, which has left them without savings for their retirement years. They say that they are just getting their money back under this program.

But that is simply not the case. Their money is long gone. It was spent in the same year that it was collected, on Social Security payments to people who are now long dead, to fund other welfare-state programs, or to fund the national-security establishment and its vast and ever-growing array of warfare-state programs. The money that is being given to seniors today is coming out of the pockets of their children and grandchildren and their friends in those generations, many of whom are struggling to make ends meet. The problem is only getting worse because seniors are demanding more, which means even more taxes must be imposed on young and middle-aged people who are still working.

Proponents of Social Security say that this socialist program reflects how good, caring, and compassionate Americans are. That’s ridiculous. Social Security is founded on force. Young people are forced to pay Social Security taxes. There is nothing voluntary about paying such taxes. If a young person refuses to pay his Social Security taxes, the authorities will come after him, arrest him, fine him, and send him to jail. If he resists with force, he might well find himself dead at the hands of some trigger-happy cop.

Goodness, care, and compassion can come only through the voluntary choices of people. When a young person chooses to help his parents in their old age with financial assistance or personal care, that’s goodness, care, and compassion. When the IRS takes a young person’s money and gives it to seniors, that’s just political stealing.

There is no way to reconcile Social Security with the principles of a free society. Freedom necessarily entails the right to keep everything you earn and decide for yourself what to do with it…

Click here to continue reading at The Future of Freedom Foundation.

FFF: Do We Need the First Amendment?

Do We Need the First Amendment? is a simple article by former trial attorney and professor Jacob Hornberger over at the Future of Freedom Foundation. The topic of where our rights come from, though, is vital and people constantly need to be reminded. There are both conservatives and liberals who think that our rights are from and/or are limited to the Constitution’s Bill of Rights. Some incorrectly believe that if we amend the Constitution to remove one of the listed rights, then we have done away with that right. Others wail and complain if the Supreme Court decides there is a right in existence not listed in the same Bill of Rights.

One must remember that the US Constitution gave form to the government, but perhaps more importantly it listed every power that the federal government was delegated by the people. When some people complained that the proposed Constitution didn’t originally list any protected rights, the framers said “Look, we didn’t give the government to abridge any rights. See? That power isn’t listed anywhere.” But people demanded a Bill of Rights just to be extra sure that it was clear that the government had no power to legislate in those areas. Again, some people said, “But if we write down a list, then some day people might think that only the listed the rights are protected” and people replied “We didn’t give the government that power! But here’s a ninth amendment that says you keep all of those, too.” Unfortunately, people didn’t pay attention, and the government has slowly, at times, and by leaps and bounds, at other times, has encroached everything.

Many years ago, I was giving a lecture on the Constitution and the Bill of Rights to a class at a public high school here in Virginia. During the course of my talk, I made the following statement: “The First Amendment does not give people the right of free speech.”

I asked the students whether my statement was correct or incorrect. Everyone immediately told me that I was wrong. They said the First Amendment did in fact give people the right of free speech.

I held my ground. I said it didn’t, and I pressed the students to figure out why I was maintaining my position. They were just as steadfast in their position, until a girl raised her hand and said, “Mr. Hornberger is right. The First Amendment does not give people rights. It prohibits the government from infringing on rights that preexist the government.”

She was absolutely right.

The First Amendment reads:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

Notice that the Amendment does not give people rights. Instead, it prohibits Congress from enacting laws that abridge people’s rights.

But what is that all about? Why did our ancestors deem it necessary to enact such a prohibition? Isn’t Congress our friend? Isn’t it composed of people who we elect to represent us? We often hear that we should trust the government. It doesn’t sound to me that the people who enacted the First Amendment had much trust in elected representatives.

After all, the only reason for enacting such a prohibition is the concern that in the absence of such a prohibition, Congress would enact laws that abridge freedom of speech and other fundamental rights. That sounds like Americans believed that the members of Congress needed to be told that they were prohibited from doing so.

The First Amendment and the other amendments in the Bill of Rights reflect how leery people were of Congress and the rest of the federal government. They were convinced that if they approved the Constitution, the federal government they were calling into existence with the Constitution would destroy their rights and their freedom.

That was also why Americans opposed enormous, permanently standing military establishments. Given their conviction that the federal government would destroy their rights, they understood that the way governments historically had done that was through their military forces.

After all, how else to enforce a law, say, that prohibits people from criticizing the president or Congress? Sure, it would be possible to arrest, indict, convict, and incarcerate them but what if dissent became widespread among the citizenry? That’s where a massive military establishment would come into play — to use massive military force to put down dissent with round-ups, assassinations, killings, torture, executions, and other things that militaries historically have done to oppress people. That’s why all totalitarian regimes have large, permanent, powerful military establishments.

Thus, there is no possibility that our American ancestors would have approved the national-security state form of governmental structure under which we live today, a structure consisting of the Pentagon, the CIA, the NSA, and a vast empire of domestic and military bases. If the Constitution had proposed that form of governmental structure, Americans would have summarily rejected the deal and simply continued operating under the Articles of Confederation, another type of governmental system, one in which the federal government’s powers were so weak that the federal government wasn’t even given the power to tax.

The Constitution called into existence a limited-government republic, a type of governmental system that gave the federal government very few powers. There was an army, but it was relatively small — large enough to defeat Native American tribes but not large enough to threaten the American people with massive tyranny.

In fact, that’s why our American ancestors enacted the Second Amendment. It was designed to ensure that people would retain their right to keep and bear arms as a way to fight against any federal army or national police force that the Congress or the president might employ to enforce their destruction of free speech and other rights and liberties.

Thus, whenever you hear someone lamenting the lack of trust that many Americans today have in the federal government, it might be worth reminding them that the federal government was called into existence under a cloud of mistrust among our American ancestors. And they were right to have that mistrust!

FFF: The Perils and Pitfalls of Political Paternalism

The Perils and Pitfalls of Political Paternalism was written by Professor Richard Ebeling at the Future of Freedom Foundation about the dangers and costs of nanny statism.

Across the spectrum of differing political views, whether “progressive,” “nationalist,” “populist,” or “conservative,” there is a common presumption in all of their policy positions and programs. That common dominator is the premise that government is to be the guiding hand in directing and remaking society in some chosen form, to which and within which all in that society are to be confined and made to conform.

The “progressives” herald a new dawn of democratic egalitarianism based on the identity politics of race, gender, and “social class.” The nationalists hark back to a restoration of national identity in which the state defines and determines a nation’s historic qualities and characteristics, for the protection and preservation of which government regulations and restrictions are to be employed.

“Populists” demand a redistribution of governmental power and favoritism more into the hands of those who they say have been taken advantage of in the existing “establishment” system of things. And American conservatives, who once declared at least a rhetorical allegiance to the country’s founding limited government principles, seem to want nothing more than retaining or regaining political power, and are willing to be as regulatory and redistributive in their practical policy decisions as the progressives they rail against.

Lost in this ideological and political policy warfare among them for the governmental reins of plunder and privilege is the idea and ideal of classical, or limited government, liberalism, with its defense of individual liberty, free market economics, civil liberties under an impartial rule of law, and an ethics of non-interventionism at home and abroad.

In the face of these competing, yet philosophically complementary, demands for retention and expansion of “Big Brother” over even more of our lives in a growing number of directions, it is worthwhile to remind ourselves of the premises behind and the realities of the political paternalism that they jointly represent.

First and foremost, the guiding idea behind political paternalism is that the individual cannot be trusted to be a free and responsible human being. Those who wish to socially engineer our lives consider us too ignorant, too irresponsible, and too narrow in our own personal planning horizons to intelligently and reasonably take care of our own health care, our own retirement, our own family’s education, or our own spending and consumption choices…

All of these factors, and others that could be listed, show the perils of political paternalism and power-lusting. The interventionist-welfare state has been and will continue to lead us down a dangerous new “road to serfdom” in which our lives are more and more controlled, managed, and manipulated by those in political power who claim the right to dictate how we are to live and work.

It encapsulates an evil immorality in which political force continues to claim the authority to deny us our individual rights to life, liberty, and honestly acquired property. The interventionist-welfare state has been creating a new feudalism with political and special interest elites who serve as the “lords” who rule over and ruin the rest of us, the modern serfs who are expected to toil for their benefit under strangling regulations, burdensome taxes, and intrusive social controls in the name of political correctness and identity politics now and in the future.

All of us who prefer to be free men in a free society with a free market need to do all in our intellectual power to stop and reverse this reactionary counterrevolution against the ideal of human liberty. Otherwise, our civilization may be heading for a terrible collapse that will leave nothing but tyranny and poverty for too many for generations to come.

Click here to read the entire article at FFF.org.

FFF: The Ongoing Destruction of the Minds of Children

From Gary Barnett at The Future of Freedom Foundation comes this brief piece on the intentional failures of the public school system. Everyone should read John Taylor Gatto’s Underground History of American Education for a better understanding of how the system was created and why. As President Woodrow Wilson said in a speech, “We want one class to have a liberal education. We want another class, a very much larger class of necessity, to forgo the privilege of a liberal education and fit themselves to perform specific difficult manual tasks.”

There can be no greater stretch of arbitrary power than to seize children from their parents, teach them whatever the authorities decree they shall be taught, and expropriate from the parents the funds to pay for the procedure.
— Isabel Paterson

Compulsory schooling is a travesty. To call it education is absurd. Real education is lifelong learning as an individual, while compulsory public schooling is the indoctrination of children as a collective exercise to bring all down to the lowest level. Prisons called schools are simply the forced means to stifle individual brilliance while promoting sameness and monotony. The result of this brainwashing is meant to teach children to obey orders, and to be satisfied spending their lives in a virtual cage of ignorance, to never become entrepreneurs and dissenters.
With the recent death of the great John Taylor Gatto, the loss of a giant is evident. He was not only a pioneer in real education, but he discovered the true nature and genius that exists in so many children. The controllers who use the government school system as a way to dumb down the masses fully understand this potential genius. They are very fearful of it. So fearful in fact, that more than 100 years ago, they designed a mandatory school system as a way to control the common people. By training them to be good citizens and members of a collective society instead of individuals, the few could continue to control the many.
The experiment called compulsory schooling, now referred to as “public education,” began in Massachusetts in 1852, and became widespread just after the turn of the twentieth century. By 1910 the majority of children were in public schools. Since that time “education” as administered by the state has been a horrible failure, if learning was the desired end. But learning and knowledge were never the goals of forced schooling; training the young to honor authority, discipline, and nationalism were the true goals sought. In that regard, public schooling has been completely successful. These institutions became the vehicle used to teach children to be managed instead of managing themselves. They have produced a soft society consumed by doubt and incompetence, and one that can function only as a mass.
In order to change this dynamic, a real education is necessary, but so long as parents continue to shirk their responsibility by allowing unknown state employees to raise and train their children, things can only get worse.
John Gatto knew that teaching reading, writing, and arithmetic could be accomplished in as few as 100 hours. The improvement of those skills would be self-taught at the appropriate time and place, as self-taught persons are far more advanced than those subject to and dependent on mass schooling. Any real study of most kids educated at home will expose this truth.
As I see it, it is up to parents to save their own children. That will not be an easy task, as most parents are products of the same state-schooling system that exists today, and were taught long ago not to rock the boat or question authority. Everything should be questioned, and everything should be scrutinized. Questioning authority is the bane of the state apparatus, which is the reason compulsory schooling was implemented in the first place. It continues unabated as the dominant training discipline of this country’s young.
Take a look around and you may be shocked. How many have lost their imagination? How many seek counseling? How many feel inadequate and consider suicide? How many do you know who manage their lives by taking prescription drugs? How many are bored, emotionally wrecked, and afraid? Most of those people, a very large portion of the population, can no longer function as individuals. Such behavior should be expected, as the product turned out by the mandatory government school system has little ability to think and act without guidance. That is a direct result of being a prisoner of state-sponsored indoctrination centers from infancy to adulthood. That is why public schooling is anathema to free-thinking, self-reliant, and responsible individuals.
Mass schooling guarantees a weak and compliant population, one that has lost the ability to think critically. It is an all-consuming addiction to mediocrity, and an escape from excellence. No society can continue to be free and prosper under such conditions. Why, as John Gatto asked, are we turning our kids over to total strangers who can mold their minds with state propaganda for twelve years? It is time for parents to take back their children, and rescue them from a life of dependency.
This article was originally published in The Future of Freedom Foundation’s March 2019 issue of Future of Freedom.