From Warfare to Welfare, the whole spectrum of government requires one thing, money. The money loaned to the government, so it can continue to function, comes directly or indirectly from the FED, our central bank. That is because government does not have any money and produces very little the marketplace wants. So they either tax people directly, which is to obvious, or they borrow it from the FED.
Where does the FED get the money to loan? They make it up. They print it. They alter digits on a computer. Now, if you did that, you would be a counterfeiter.
Who authorized the bank to counterfeit? Our government of course. It is slight of hand to permits government to borrow without direct taxation. So government has put into place laws to make themselves and their partner the FED the exception. They always pass laws to make whatever they want “legal” even if it is theft. Just as they pass laws to criminalize your existence so they can have justification for your arrest, incarceration or death, whatever is necessary. The FED, or for that matter, banks in general, have no money but most people assume they do. The banks either make it up or they multiply what is given to them, which is where we get the term fractional reserve banking. So either they change the balance in a computer or you give it to them from which the multiply it times ten. They can also leverage that multiplied amount using other financial instruments like derivatives. In any case, they charge you interest on every dollar used even though it is your dollar.
Pretty sweet to loan you your own cash and charge you interest on your own money. The Federal Reserve Note (US dollar) is simply a note of debt that has interest due on it.
All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation. John Adams
How does this debt get paid? Most people think taxes go to paying for roads, schools, fire stations, etc. They does not. Taxes are used to pay off the original loan plus the interest on that loan that the government took out.
How does the government take out a loan? They sell bonds (US Treasuries) which are also due interest. After all, why would anyone buy them if they paid nothing to the purchasers (which are usually big banks that are connected in some way to the FED and the US Treasury). Taxes go towards paying the interest due to the FED and to paying off the Bond holders the interest due to them. Then the government takes out more loans to spend on keeping its minions (bureaucrats) paid and spending the rest on warfare, welfare and public works. Those loans have interest due them too.
What happens when the interest is not paid? You cannot take out any more loans. So the government has to pay the interest via taxes or else the flow of money stops. Thus the debt must be paid. It can never stop. But each loan has to be larger then the last one because it has to cover the original loan plus the interest due on it, else not more loans. If no more loans, then no more EBT cards and food stamps, no more social security checks, no more federal pensions, no more military spending, no more FDIC, no more subsidies for education, agriculture, oil; no more police militarization, no more regulators, no more PBS, no more Planned Parenthood, no more American Heart Association, no more Post office, no more foreign aid. You get the picture.
From the federal government to the municipality, they all depend on loans. All of which have interest to be paid. The banks grow wealthier and turns around and buys more bonds from the government because the government has to borrows more to meet its growing obligations. And it needs more power so it can take more from the so called “inventory”, as the IRS puts it. And you are the “inventory” they are referring to. You are required to fill their purse. Now we can see the utter stupidity of the Occupy Wall St. movement, welfare democrats and neo-cons. The occupy movement actually wanted the government to take on the banks, whom the government depends on for its very survival. Occupy has no clue what is going on (get a clue here). They do not understand that to use the government for anything is to benefit the banks, to put money into the pockets of Wall St. Financiers, and to plunder the people further.
Unfortunately, many politicians know to place power into the hands of government is to strengthen the banks. To want more welfare like “FREE College” is to strengthen the banks. To go to war is to strengthen the banks. Any call to government action is to steal from people, mostly middle class working people. How utterly absurd to believe the government would come to the aid of the people against the banks when banking has become the foundation upon which our socialist government now sits.
Now we can also see why Detroit pays millions of dollars back to the banks yet cuts off the water of poor people. Detroit has to pay back the loans it took out to make good on all the political promises like pensions and health care. Otherwise the loans will stop and when they stop, so do the services which people have been promised. And where do they get the money to pay these loans? From the residents of Detroit themselves. So they will squeeze (tax and fine) the people who voted them into office. The is the route of welfare.
We can also see the need for constant US wars. The stability of the dollar must be maintained. If it loses the perception of value it will jeopardize the ability of the federal government to pay back its loans. The lives of soldiers are spent in loan maintenance to the banks and a bankrupt government, while feed other rationalizations to justify the violence by soothing the conscience with morality.
Conclusion
Until this debt based system ends war and poverty and hunger will not. Purchasing power is disappearing like the middle class. Debt based money that fuels government and the banks only enrich the elite and plunder and murder everyone else. The system must not only end, it must not be restarted after it collapses.
Read Full Post »