Government Money Masters: Anti-Gold Videos that Thousands of Tea Party Voters Think Are Conservative

Gary North

Oct. 6, 2011

The conservative movement is filled with well-meaning people who do not understand free market economic theory. They believe that they hold to free market economics, but they in fact hold to a crude Keynesianism: economic salvation by fiat money.

Inside the conservative movement for over a century has been a hard-core cadre of left-wing promoters of big government. They present themselves as enemies of fractional reserve banking. They use this to get a hearing for their cure-all for banking: a fiat money monopoly that is completely managed by tenured, unaccountable bureaucrats operating under the authority of Congress.

These people are part of a movement called Greenbackism. It has been around ever since the 1870s. Back then, American Greenbackers had their own political party. They merged with the left-wing Populist Party in the mid-1880s. You can read about the Greenback Party on Wikipedia.

The Greenback Party (also known as the Independent Party, the National Party, and the Greenback-Labor Party) was an American political party with an anti-monopoly ideology that was active between 1874 and 1884. Its name referred to paper money, or "greenbacks," that had been issued during the American Civil War and afterward. The party opposed the shift from paper money back to a bullion coin-based monetary system because it believed that privately owned banks and corporations would then reacquire the power to define the value of products and labor. It also condemned the use of militias and private police against union strikes. Conversely, they believed that government control of the monetary system would allow it to keep more currency in circulation, as it had in the war. This would better foster business and assist farmers by raising prices and making debts easier to pay.

Back then, Greenbackers were openly inflationist. They wanted city dwellers to pay farmers more for food than the free market established. They wanted city dwellers to pay more than free market competition established for wages. They wanted the U.S. government to compel these price increases by printing paper money.

Ever since the passage of the Federal Reserve Act in 1913, Greenbackers have attempted to conceal their left-wing platform in order to infiltrate the conservative movement. They have used their hostility to fractional reserve banking as a cloak. What they really want is money officially run by Congress, whether Republican or Democrat. This is why they have always hated money that is redeemable in gold. The government cannot inflate the money supply very much if money is redeemable at a fixed price for gold.

Why do conservatives swallow this witches' brew of statism and inflation? Because they do not understand monetary theory. On monetary theory, they are Keynesians. They believe what Ben Bernanke believes: that it is possible to avoid inflation, avoid recession, and attain economic growth by having a committee of experts decide how much money to print. The Chicago School economists (monetarists) think the same thing. The debate is about who decides how much money to create after Congress has set up the committee of experts.

Congress today is legally in charge of the Federal Reserve System's Board of Governors. It is only indirectly in control of the Federal Open Market Committee (FOMC), which is made up of a mixture of Board members (government appointed) and regional Federal Reserve Bank presidents (privately appointed by regional bankers). In fact, Congress is not in control. The FOMC is in control.

Because the implementation of U.S. law is always by the executive branch -- this is federalism -- all calls for Congress to control money are really calls for committees appointed by the President to control money. But, ever since 1883, employees of the executive branch have been protected from being fired. This was the Civil Service law. So, whenever anyone calls for Congress to control money, he is calling for an independent committee operating under the President to control money. This is what the Constitution provides: a separation of powers. The Civil Service Act began the separation of politics from government: rule by tenured bureaucrats.

Greenbackers do not openly discuss this Constitutional issue. They never have. They invoke the word "Congress," yet ever since 1883, this has meant "a committee made up of bureaucrats appointed by a President, ratified by the Senate, but operationally independent of both."

Greenbackers call this monetary system sovereign money. It means "money created by bureaucrats who possess the power of the U.S. government, yet who are operationally independent of the government because of Civil Service protection."

I have written a book against one of these promoters, Gertrude Coogan. You can download it for free here.

I have created a department to refute another one, Ellen Brown. You can access it here: http://www.garynorth.com/public/department141.cfm.

The books by Brown and Coogan have been the most popular Greenback books. But books are not the main sources of recruiting by Greenbackers. Videos are.

The first video is called The Money Masters. The narrator is Bill Still. Mr. Still has written no books. He has not published scholarly articles on economic theory. There is no Wikipedia entry for him. Compared to Bill Still, the Rothschilds are publicity hounds. He has not addressed the issue of Civil Service protection for his proposed government money masters. Part 1 is here.

It took a lot of money to produce this video.

He narrates a follow-up video, The Secret of Oz.

Next, there is a PowerPoint presentation. It was produced by something called the Council on Spiritual, Psychological, Economic Renewal. I could find no books sold on its site, or anything that showed who they are or what they are promoting. There is no indication who the narrator is. He sounds young. The video is here:

Then there is Money as Debt, a combination narrative and cartoons.

The Greenbackers have never had a trained economist to defend their fiat money views. They only have books written by people with no training in economics. They do not have a scholarly journal. They do not have intellectual magazines. They never have -- not since 1874.

What they have is supporters. I know, because they keep sending me links to these videos.

If you want a video that presents a critique of the Federal Reserve System that does not call for the creation of a new set of bureaucratic money masters licensed by Congress, view this. The Mises Institute produced it.