Tag Archives: Income tax

It’s All About the Money

Dave Volek, on WriterBeat.com, wrote an article January 12, 2019 on The Money Masters, a 3.5-hour YouTube presentation on historical manipulators of wealth.  Volek’s article and the subsequent comment thread were enlightening, with contributions from people apparently well versed on the subject.  My own interest in how all this works rests on readings such as The Creature from Jekyll Island:  A Second Look at the Federal Reserve, by G. Edward Griffin, Wealth of Nations, by Adam Smith, The Robber Barons, by Matthew Josephson, Confessions of an Economic Hit Man, by John Perkins, and Hamilton, by Ron Chernow, among others, as well as business news in various periodicals and newspapers for a couple of decades.  Commentators on Dave’s article linked to other on-line videos, some of which I also watched, but I ended up with more questions than answers.

These are the links to the article and videos referenced below:

Dave Volek:  http://writerbeat.com/articles/28727-The-Money-Masters

The Money Mastershttps://www.youtube.com/watch?v=gFj_cqNBaZY

Money as Debthttps://vimeo.com/131985511

America:  Freedom to Fascismhttps://www.youtube.com/watch?v=O6ayb02bwp0&app=desktop

THE MONEY MASTERS

The Money Masters, made in 1996, gave an overview of historical attempts to own and control wealth.  The usual culprits were mentioned: Alexander Hamilton, the Rothschilds, the banking cartels, including the Federal Reserve, among others.  It mentions the link between central banking and the income tax.

But there was an agenda, because the makers stressed reform of the banking system in favor of the government’s printing its own money and bypassing debt and the Fed.  I believe Mefobills on WriterBeat advocated the same, calling it “sovereign finance,” and according to him, that’s how Canada financed its transcontinental railroad debt-free.  As William Still, the creator of The Money Masters confirmed, anything that can be accepted in payment of taxes constitutes legal tender.  If I remember right, that’s how states in the early days (before the Constitution) gave legitimacy to their currencies.  Apparently, that’s how Maduro in Venezuela plans to legitimize his block-chain petro, backed by oil.

The documentary is spotty and ultimately unsatisfying. It hinted at things I knew; and tied concepts together in a time line that was instructive; and it served the purpose of showing how the international bankers manipulated historical events to create wars, for instance, and to determine the winners and losers.  Napoleon’s battle at Waterloo was given as an example, and the Bolshevik revolution in Russia.  The documentary claims that in WWII, the Rothschild branches in England, France and Germany, respectively, loaned money to those governments, and of course profited from all.  It said the arrangements were that the war’s winners would cover the debts of the losers.  The reason given for overthrowing the Tsar in Russia was that he refused a central bank.

While I can accept all this so far, I question the premise that a government has any better financial sense than a banker.  Both are profiting from other people’s energy/money and have theoretically infinite power over it.  The documentary says—correctly—that a debt-based dollar with the Federal Reserve as go-between has no more value than a dollar created by the government, except the latter is interest free.  It suggests the federal government could lend its own dollars to states and localities interest-free for local projects.  The problem, says the documentary, is the usury of interest—especially to profiteers like the Fed.  It also condemns fractional reserve banking and gives a good explanation of how that works.

But who’s to say government-determined projects are in taxpayers’ best interests?  It still constitutes a debt to the government, even if your property is flooded by a dam the government deems necessary.  Would Savannah borrow from the federal government as liberally as it sells bonds to finance its replacement of school gym floors or to replace grass with astro-turf on the sports fields?  Wouldn’t taxpayers be just as obligated, even if the loans carried no interest?  That would give the taxing powers license to borrow for ever more wild-eyed projects.

MONEY AS DEBT

A commentator on Dave Volek’s article, Logical Man, recommended Money as Debt, so I watched that 45-minute video, too.  It had the same theme as The Money Masters and the same agenda.  Essentially both denounced interest and claim the government should issue interest-free money to lend to smaller governments (states and municipalities) for infrastructure projects and the like.

Money as Debt (which should be “Debt as Money”) gives a good scenario of why interest on principal perpetrates an ever-increasing debt bubble.  If principal is created as bank credit, where does interest come from?  All those debtors must scramble to pay interest or go bankrupt and lose their assets.  A typical strategy for the bankers is to generate new loans to cover the interest on old loans, thus including old interest in new principal.  The Creature from Jekyll Island describes this in some detail.

Money as Debt claims that without debt there would be no money, an argument I’ve heard before.  That’s only because we live in a stupid system built on living beyond one’s means, starting with the government(s).  Second, the government exists to fund itself through extortion and war, so it spends a goodly portion of its income creating mayhem around the world that it then extorts more money to repair.

While The Money Masters disparages the gold standard—it’s too easy to corner the gold market—I believe some kind of standard is necessary to keep government within limits.  What’s to stop any government at any level from printing or borrowing unlimited funds to justify government contracts to friends and business associates, as now?  The specious argument that gold is too easy to corner assumes a fixed price.  Even if the central banks hold most of the gold now, it does them no good sitting in vaults, especially if they’re not allowed to print IOUs instead of selling the gold itself.

If the federal government decides to go to war, or wars, as now, who could stop it?  Would states and localities be required to pay for it, as now?

The pundits make a distinction between government finance and individual finance.  They presume that’s okay, even though all acknowledge the government is corrupt.  But to spend without permission, and especially to go into debt in other people’s names, is a reprehensible practice and symptomatic of the autocratic paternalism of all governments today.  Those who buy bonds collude with the deception and become willing conspirators in exchange for their purchased position in the “ruling class.”  I could say the same for stock purchasers, who also understandably want something for nothing in the form of dividends.  Here we have people actively contributing to destruction of the planet to “grow the economy” while actually depleting it.

But no one addresses such sticking points as the effect of the petrodollar or that paying off a debt contracts the money supply, as does writing off a debt, as happens in bankruptcy.  No one can know how much money is out there, especially as every country has its own.  China and Russia are talking about (and may have enacted) gold-backed currency.  This may be a factor in US demonization of these two governments.

No one but me suggests that credit is destructive, whether it charges interest or not.  Unlimited credit provides unlimited opportunity to do stupid things, and if you’re a government, those stupid things cost everyone and benefit only a few.  Then there are the government contractors, which in my ideal society would not be allowed.

AMERICA:  FREEDOM TO FASCISM

I ended up watching a 2.5-hour video by Aaron Russo entitled America:  Freedom to Fascism, made about 2006.  This was also recommended by a commentator, Jeffry Gilbert, on Dave Volek’s The Money Masters post.  Russo’s video is about the income tax and goes into some detail refuting the belief that there’s a law requiring wage earners to file.  The 16th amendment, he claims, imposed no new taxes, something affirmed in at least five Supreme Court rulings since 1913.  According to the Constitution, two types of taxes are allowed:  direct and indirect.  Direct taxes must be apportioned by population.  The Supreme Court has defined “income” as profits from a corporation, not wages, which it defines as receipts from sale of time or labor.

Russo interviewed people like former US Congressman Ron Paul, several former IRS agents, a restaurant owner who was targeted by the IRS for presumed drug dealing, and several people from an organization called “Tax Honesty.”  Most interesting was an interview with a former commissioner for the IRS, who wrote the tax code and who now works for a high-powered law firm.  This guy could not or would not answer whether there’s a specific law requiring people to file.  He essentially said Supreme Court rulings saying the 16th imposed no new taxes were obsolete and irrelevant.  Yet the IRS code says it’s a voluntary tax.

All this was linked to the Federal Reserve, and the video’s ultimate agenda was to abolish the Fed, which Congress has the power to do.  Russo raised the question of whether there is any gold left in Ft. Knox.  Some believe the gold is being held as collateral in the Fed’s New York office basement against the national debt.

Russo also mentioned the federal government’s obligation/responsibility to coin and issue its own money.

In any case, I surprise myself by piercing other peoples’ (and general) assumptions, on which the whole authoritarian power structure rests.  The primary assumption is that the masses are stupid, childlike, and don’t know what’s good for them.

 

How Did It Happen?

Does anyone ever wonder how we got the income tax?  This tax has become so universal, on international, federal, state and even local levels, that it is taken for granted, but few people seem to question its legitimacy, history, or even its purpose.

An internet search suggests a form of “wealth tax” or income tax existed in the Roman Republic, ancient Egypt, and China, but the form we know, usually imposed to finance wars, began in England in 1188, by Henry II, for the “Saladin tithe” to fund the Third Crusade.

In his landmark book, Wealth of Nations, in 1776, Adam Smith, a Scott, suggested even the King of Britain could not get away with an income tax.  Tax on interest or money is difficult to calculate without extraordinary “inquisition” into every man’s private circumstances and “would be a source of such continual and endless vexation as no people could support.”  However, a mere nine years after Smith died in 1790, British Prime Minister William Pitt the Younger formally implemented the income tax, designed to pay for the French Revolutionary War, to purchase weapons and equipment.  It was a progressive income tax and in place between 1799 and 1816, but for a short reprieve following the Peace of Amiens in 1803.  It was reintroduced in Great Britain in 1842 by Prime Minister Sir Robert Peel, who was seeking revenues for the government’s increasing budget deficits.

“A heavy progressive or graduated income tax” is the second major tenet of the The Communist Manifesto, as delineated by Karl Marx and Friedrich Engels in 1848.  The fifth tenet advocates “Centralization of credit in the hands of the State by means of a national bank with State capital and an exclusive monopoly.”

In the United States, President Abraham Lincoln instituted the first US income tax in 1861 to pay debts from his war.  It was repealed by Congress in 1872.

The Socialist Labor Party pushed for an income tax in 1887.  The Populist Party demanded it in its 1892 platform, and the Democrats, led by William Jennings Bryan, advocated for the progressive income tax law passed in 1894.   Called the William-Gorman Tariff Act (Revenue Act), it reduced tariffs and imposed a two percent income tax but only on the top ten percent of earners.  In 1895, in Pollock v. Farmers Loan and Trust Co., the Supreme Court declared the tax unconstitutional, based on the constitutional requirements that taxation be apportioned by a state’s population.

Republican Rhode Island Senator Nelson W. Aldrich, who served between 1881 and 1911, was probably the single most influential individual in creating the financial structure we know today.  As chairman of the Senate Finance Committee–which oversaw bank regulation and monetary policy–he was possibly the most powerful man in the nation from 1898 to 1911. The financial Panic of 1907, (which some believe was engineered by banker and Aldrich friend/business associate, J. Pierpont Morgan) led to the Aldrich-Vreeland Act in 1908, which was designed to make the monetary supply more elastic.  It also established the National Monetary Commission with Aldrich becoming chairman.  As chairman, he led a team of “experts” to European capitals to study their banking practices, and returned as a proponent of a national banking system.  He worked in secret with powerful bankers to develop the “Aldrich Plan,” which eventually formed the basis of the Federal Reserve Act of 1913.  The secret dealings that began in 1910 and led to the creation of the Federal Reserve system is well documented in The Creature from Jekyll Island:  A Second Look at the Federal Reserve, by G. Edward Griffin.

Aldrich, who apparently had a habit of publicly opposing things he wanted, then voted in Congress for the corporate income tax in 1909, claiming this was to insure the personal income tax would not be passed.  Ten years before, he had called the income tax “communistic.”  However, later he and President William J. Taft then agreed that a constitutional amendment would be more effective in overriding the Supreme Court’s objections the 1894 law.  Aldrich claimed he believed the 16th amendment would never be approved.

The relationship between the Federal Reserve System and the new income stream generated by the income tax is not well documented, but it resembles that of the Whiskey Tax and the nation’s first central bank in 1791.  At that time, Treasury Secretary Alexander Hamilton introduced legislation for the whiskey tax on December 13, 1790 and for the central bank the next day, on December 14, 1790.

A common thread in the two bank/taxing schemes was that they gave the federal government the authority, if not the right, to investigate every taxpayer’s personal property and bank accounts searching for infractions, and to seize property it decides has been obtained illegally.  This has set the precedent for the federal invasion into private lives that has become so prevalent today.

In the “Gilded Age,” Nelson Aldrich was well known for his close and unsavory ties to business, by which he had become personally wealthy.  He believed his power base would successfully defeat the income tax amendment.  Indeed, while they were opposed, their solidarity had broken down, so individuals like Andrew Carnegie and John D. Rockefeller (whose son John Jr., married Aldrich’s daughter Abby) formed tax-exempt foundations to shelter their wealth before the tax went into effect.

At that time the income tax was promoted as a “class tax,” with only the upper income earners affected, so the idea of wealth re-distribution appealed to lower income earners.  Only later did President Franklin D. Roosevelt expand the “class tax” to a “mass tax,” according to former IRS historian Shelley L. Davis in her book, Unbridled Power: Inside the Secret Culture of the IRS.

Proponents of the income tax used other arguments, too.  It was proposed as a more reliable method than tariffs for raising federal revenues, and gave President Woodrow Wilson justification for reducing tariffs.  Also at that time the idea of Prohibition was in the air, and advocates of Prohibition recognized the government would lose income from excise taxes on alcohol.

The 16th Amendment reads, “The Congress shall have the power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”  It was passed by Congress on July 2, 1909 and sent to the states for ratification.

It was supposedly ratified by the requisite number of states by February 13, 1913.  However, there is some question about whether it was ever properly ratified.  In 1985, William J. Benson published The Law that Never Was about the income tax.  Here, Benson claimed that in 1984 he had visited national archives and all 48 state capitals looking for records of ratification.  Not only had he found variations in wording and punctuation from the congressionally approved amendment, but he claimed some states which were certified as ratifying never did or voted against the amendment.  He said only two to four states had ratified as written.

Constitutional amendments require ratification by three-fourths of states.  In 1913, there were 48 states, so 36 would have had to ratify.  Benson found that seven states had not ratified at all.  1913 Secretary of State Philander Knox had claimed Kentucky and Tennessee ratified, but Benson said they did not.  Eight states were reported as having ratified, but Benson found no evidence of it.  Six more states did approve, but the governors or other officials required to sign did not sign.  Twenty-five states violated provisions of their own constitutions in ratification, and 29 violated state procedures.  Twenty-two states changed the wording to ratify, one state changed spelling, and 26 states changed punctuation.   Oklahoma changed the wording to say the opposite of what the amendment said.  Tennessee law required a delay until the next session but ignored it.

The American Law Division of Congress’ Congressional Research Service responded in May, 1985 to Benson’s claims.  “While it didn’t rebut Benson’s factual claims,” it said the amendment had been ratified “because Knox said it had been ratified,” says one internet source.

In 1990 Benson went to prison for tax evasion.  He served 15 months before a federal appeals panel overturned the conviction, saying a government witness had given improper testimony in the 1987 trial.  This occurred less than one month before Benson was scheduled for parole.

Benson’s book caused quite a stir, and he was selling packages based on his book to help individuals fight the Internal Revenue Service.  However, those who have used his arguments have not fared well in court.  Also, Benson himself was the loser in court rulings in 2007 and 2009 that determined his “Reliance Defense Package,” which he sold for $3500 to tax protesters, was fraudulent.

Courts have denied requests for evidentiary hearings and have refused to hear the arguments against the 16th amendment itself, claiming “Secretary Knox’ decision is now beyond review.”

In an interview in 2013, Benson remained an income-tax evader and bragged he has never gone back to prison, despite his continued outspoken crusade against the 16th amendment.

 

 

 

Dr. Kathorkian Spotlights JP Morgan

Satire/Humor

by Dr. Kathorkian,

an alter ego of katharineotto.wordpress.com

bkschermorgan1990The Cosmic Improv Group

brings JP Morgan to

Dr. Kathorkian’s Spotlight Therapy*

Chapter Three:  Cosmic Improv Group Series

 

Friday, January 18, 2008 – I assumed a mountain of debt going to medical school and into private practice, then the bottom drops out of my stock equity, and I’m stuck with the debt.  That’s how they do it.  It was a direct economic hit on my financial freedom, engineered by a stockbroker and banker I thought worked for me.  My wrath over the betrayal was like a nuclear reactor in meltdown mode, so the Cosmic Improv Group, that gaggle of personalities inside my imagination and unheard by others, decides to hose me down before I get too hot.

Always eager for good entertainment, the CIG invites JP Morgan to a Spotlight Therapy session, so I can tell him off.   I’ve done my homework.  I’ve read The Creature from Jekyll Island, The Robber Barons, None Dare Call it Conspiracy, Democracy in America, Confessions of an Economic Hit Man, the US Constitution, and other tomes of epic wisdom.  I am armed.

My inter-dimensional travels through print media have revealed how JP Morgan and his international banker friends, like Paul Warbucks . . . er . . . Paul Warburg, engineered the federal income tax and the Federal Reserve Act in 1913 to enslave American taxpayers in unrepayable debt.  Congress gave itself the power to obligate present and future taxpayers to the Federal Reserve System for perpetual interest payments, on debt assumed by Congress. Not only are taxpayers expected to pay interest until the sun burns out on money that’s worth nothing, but Congress uses the fake money to lay waste to the nation’s natural resources and neighborhoods, and to create conflict around the world.  It funds its enormous bureaucracy and the pension and benefits plans for all those government employees.  It funds Medicare, Medicaid, and Social Security with money stolen in payroll taxes.  These electronic dollars are invested on Wall Street.  Congress also pays the Department of Offense to make life miserable at home and abroad.  Congress further believes it has the right to obligate taxpayers to pay an army of no-bid federal government contractors. Congress sets its own salary, pensions, benefits and other assorted goodies, by obligating unborn taxpayers until the time the country officially declares bankruptcy.

As all this fiat money floods the financial system, the increased money supply causes inflation and higher prices on goods and services, especially indispensable commodities like food and energy.  Those who can least afford it are hardest hit.

So back in 1913, the conspirators used freshman United States President Woodrow Wilson, whom they’d been grooming for years, to do their dirty work.  Ole Woody thought he was the second coming of Christ, so the bankers and other manipulators, like Winston Churchill, played to his ego and got him to go against every campaign promise he made.

This eventually led America into World War I, which was the long-term goal of the bankers.  The Brits owed the bankers a lot of money, and the bankers needed that money to lend to Germany.  So they figured to bleed America, too, to increase profits.  Thus did they conjure up the aforementioned double whammy on American taxpayers, to cover their foreign ass-ets.

Now in the CIG, when JP Morgan starts bragging about how they pulled this off,  I light into him.

“You asshole,” I fume.  “You deserve to have your gold chains tight around your neck.  No wonder you were such a lonely, bitter man, whom everyone was glad to see dead.  You left a legacy alright, dying the year you achieved the income tax and the Federal Reserve Act.  Didn’t even have the balls to go to the 1910 secret planning meeting at Jekyll Island yourself.  That’s how sleazy you were.

“I wouldn’t trade a good knitting needle for the likes of you and all your fawning pawns.  In fact, I would use a knitting needle on you real quick like, and not to make a sweater.  I would go for the balls, just to see if you have any.”

JP sits there grinning, as though he appreciates my standing up to him.  He thinks I’m cute.

He says if I had been at the Jekyll Island meeting, he would have gone.

He achieved his dream, and then he died.  His dream didn’t make him happy.  This is the lesson de Tocqueville anticipated.

If I had been at that meeting, we would have had a different history, I’m sure, because those boys needed to know who really runs things in this country, and it ain’t them.

JP is impressed that I cashed in my IRA.  I’m sending shock waves through the system, with my political statement.  No wonder the Wachovia’s investment advisor was so anxious to get rid of me.

Yeah, right, JP.  Can you do anything useful?  You’re not making much progress on that knitting.

He grins and tries to cast on a stitch, but doesn’t know how.  His hands are clumsy.  I show him how to cast on, but it takes several minutes, because he is not gifted in New Age String Theory and knitting dynamics.

In knitting, every stitch is dependent on every other stitch.  When you make everything and everyone dependent on you, you are the most hog tied of all.

“No preacher told me I would have to knit in hell,” says JP Morgan.  “If they had, I would have owned knitting, because this is a fast growing market with a captive population.”

“For some people, knitting represents a form of heaven, and no one can own that,” I say.  “All it takes is the right attitude and tools.”

 

*Inspired by The Robber Barons, Matthew Josephson, 1934, 1962

The Creature from Jekyll Island: Notes and Thoughts

bksgriffincreature1994

The Creature from Jekyll Island:  A Second Look at the Federal Reserve
by G. Edward Griffin, first published 1994.
Notes and Thoughts on the first three chapters.

           The Creature from Jekyll Island is astounding in its implications.  It reveals that the money lending game is essentially between banks, with debt fueling the pump.  Powered by individual as well as government debt taken on in  taxpayers’ names, it makes me wonder whether unborn taxpayers can be obligated by federal debt.  Also, if the Fed were abolished, might all this artificial debt cancel itself out?

The book starts with a cameo of a secret meeting on Jekyll Island, Georgia, in 1910 that led to the Federal Reserve Act in 1913.  Nelson Aldrich, Senator from Rhode Island and father-in-law to John D. Rockefeller, Jr., hosted the private rail trip for six other movers and shakers in the banking and finance industries.  These men were to arrive at the train station separately, go by first names only, and say they were going duck hunting.  The regular staff at JP Morgan’s Jekyll Island Club was given a vacation.  Carefully selected others served the men while they were there.

The men were: 1.  Aldrich, who was also Republican “whip” in the Senate, chair of the National Monetary Commission, and a business associate of J. P. Morgan; 2.  Abraham Piatt Andrew, Assistant Secretary of the US Treasury;  3.  Frank A. Vanderlip, president of the National City Bank of New York, the most powerful bank at the time, and representing William Rockefeller and the international investment banking house of Kuhn, Loeb, and Company;  4.  Henry P. Davison, senior partner at JP Morgan Company;  5.  Charles D. Norton, president of JP Morgan’s First National Bank of New York;  6.  Benjamin Strong, head of JP Morgan’s Trust Company;  7.  Paul M. Warburg, partner in Kuhn Loeb and Company, a member of the Rothschild banking dynasty in England and France, and brother of Max Warburg, head of the Warburg banking consortium in Germany and the Netherlands.

When Griffin says the Fed creates money out of nothing, he is not entirely accurate.  Rather, the Fed creates debt out of nothing to lend to Congress and calls it money, because it is backed by congressional promises of future taxpayer earnings (through the income tax, established earlier the same year, 1913).  The incredible credit is then passed off as currency, and no one is the wiser.

Until now.  The lie continues that US taxpayers are obligated by congressional guarantees, but we are not morally obligated to pay that debt.  Unfortunately, since their strategy has included putting everyone on the payroll—in one form or another—everyone is implicated in the scam and terrified of its inevitable unraveling.

Obviously the easiest solution is for individuals to get out of debt.  When debts are paid off, the money vanishes into the red hole it came from, the money supply shrinks, and deflation gives everyone except banks, debtors, and governments—the biggest debtors of all–more buying power.

Griffin gives a good summary at the end of each chapter, thereby simplifying this 600 page tome.

Chapter 1:  “The Journey to Jekyll Island” tells how the skeleton of the Federal Reserve System was worked out at Jekyll Island in 1910 by RI Senator Nelson Aldrich and six other men representing the most powerful banking interests in the Western world.  These included US banks under JP Morgan and John D. Rockefeller; English and French banks under Kuhn, Loeb and Company, representing Rothschild interests in Europe; and Germany and Netherlands banks by the powerful Warburg family.

Author Griffin refers to it as a banking cartel, in which powerful competitors align to prevent other competition and use the government’s police power to enforce their monopoly.  Griffin hints without actually saying that descendants of these five banking dynasties still control the Fed.  These are Morgan, Rockefeller, Rothschild, Warburg, and Kuhn-Loeb.

He says the Jekyll Island meeting had five objectives:  1. Stop the growing competition from the nation’s other banks;  2.  Obtain a franchise to create money through debt;  3.  Get control of all the banks’ reserves so the more reckless ones would not be exposed to currency drains and bank runs;  4.  Get taxpayers to cover the cartel’s losses;  5.  Convince Congress the purpose was to protect the public.

Chapter 2:  “The Name of the Game is Bailout.”  The crucial point is that all the money created through the banking system since the Federal Reserve Act is backed only by debt, primarily by Congress’ obligating taxpayers’ future earnings.  A defaulted loan, thereby, costs the bank little in tangible value.  Therefore, the goal is to continue receiving interest on the loan by lending more (future) money to cover it.  This is especially true with large loans.  With extremely large loans the cartel gets the federal government to guarantee the loan, should the borrower default.  If this tactic fails and the bank is forced into insolvency, the FDIC is used to pay off depositors.  Small banks pay disproportionately for this “insurance” and are least likely to be bailed out, should disaster hit.

Because money is created out of nothing for the purpose of lending, huge sums are dispersed through the economy, devaluing the existing currency and causing inflation.

Griffin does not say that the income tax, passed earlier in the same year, 1913, was the funding source by which the federal government would pay perpetual interest to the Fed on the national debt.  This method mirrored the 1790-1791 creation of the whiskey tax and the nation’s first central bank, a double whammy on taxpayers, devised by Alexander Hamilton and George Washington.  (This from Alexander Hamilton, by Ron Chernow, 2004)

Chapter 3:  “Protectors of the Public.”  This chapter gives multiple examples of previous federal bailouts, beginning with Penn Central in 1970, Lockheed in 1970, the Commonwealth Bank of Detroit in 1974, New York City in 1975, Chrysler in 1978, the First Pennsylvania Bank of Philadelphia in 1979, and Chicago’s Continental Illinois in 1982.  Continental was the first electronic bank run.  It was the nation’s seventh largest bank at the time, with $42 billion in assets, with multiple loans out to high-risk business ventures and foreign governments.  Here the Federal Reserve becomes the “lender of last resort,” meaning it creates money out of nothing to cover, in this case, $4.5 billion in bad loans, and passing costs on to taxpayers in the form of inflation.

And this book has 26 chapters.  Stay tuned . . .