Elephant seals have extraordinary sexual dimorphism where sexual competition has led to massive size and aggressive fighting between the males. Whilst the fighting between alpha elephant seals does not cause significant declines in their overall populations or life-support system, imagine if they had access to global finance and nuclear weapons.
Queensland State Treasure Andrew Fraser claims that he has no option but to sell off yet more state-owned assets in order to solve Queensland's financial crisis. In this article, Ellen Brown, author of "The Web of Debt" urges Arnold Schwarzenegger the Governor of California, which faces financial difficulties similar to those faced by Queensland, to follow the example of North Dakota, which has its own bank, in order to create money to lend itself in a manner no different to the way that private banks create money to lend Governments, but at interest rates much lower than would be charged by the private banks.
By Ellen Brown. Link to original article.
"I understand that these cuts are very painful and they affect real lives. This is the harsh reality and the reality that we face. Sacramento is not Washington -- we cannot print our own money. We can only spend what we have."
-- Governor Arnold Schwarzenegger quoted in Time, May 22, 2009
In a May 22 article titled "Billions in the Red: Fiscal Reckoning in CA," Juliet Williams reports that since California voters have now vetoed higher taxes and further state government borrowing, Gov. Arnold Schwarzenegger has indicated that he intends to close the budget gap almost entirely through drastic spending cuts. The cutbacks could include laying off thousands of state workers and teachers, ending the state's main welfare program for the poor, eliminating health coverage for about 1.5 million poor children, halting cash grants for about 77,000 college students, slashing money for state parks, and releasing thousands of prisoners before their sentences are finished. Schwarzenegger bemoaned the fact that the state could not print its own money but said it could only spend what it had.
But wait -- perhaps the state can create its own money. After all, banks do this every day. Certified, card-carrying bankers are allowed to do something nobody else can do: they create "credit" with accounting entries on their books. As the Federal Reserve Bank of Dallas explains on its website:
"Banks actually create money when they lend it. Here's how it works: Most of a bank's loans are made to its own customers and are deposited in their checking accounts. Because the loan becomes a new deposit, just like a paycheck does, the bank . . . holds a small percentage of that new amount in reserve and again lends the remainder to someone else, repeating the money-creation process many times."1
President Obama has also acknowledged that banks create money through the "multiplier effect." In a speech at Georgetown University on April 14, he said:
"[A]lthough there are a lot of Americans who understandably think that government money would be better spent going directly to families and businesses instead of banks -- 'where's our bailout?,' they ask -- the truth is that a dollar of capital in a bank can actually result in eight or ten dollars of loans to families and businesses, a multiplier effect that can ultimately lead to a faster pace of economic growth."2
Money in a government-owned bank could give us the best of both worlds. We could have all the credit-generating advantages of private banks, without the baggage cluttering up the books of the Wall Street giants, including bad derivatives bets, unmarketable collateralized debt obligations, mark to market accounting issues, oversized CEO salaries and bonuses, and shareholders expecting a sizeable cut of the profits. A state could deposit its vast revenues in its own state-owned bank and proceed to fan them into 8 to 10 times their face value in loans. Not only would it have its own credit machine, but it would control the loan terms. The state could lend at ½% interest to itself and to municipal governments, rolling the loans over as needed until the revenues had been generated to pay them off. On average, interest has been calculated to compose fully half the cost of every public project.3 Cutting costs by 50% could make currently-unsustainable projects such as low-cost housing, alternative energy development, and infrastructure construction not only sustainable but actually profitable for the government.
Is all this too radical and unprecedented to consider? Not at all. One state has had its own bank for 90 years, and it has escaped the credit crunch and is doing remarkably well . . . .
Only four of fifty states are now solvent, meaning they can meet their state budgets; and one of them is North Dakota.4 It is an unlikely candidate for the distinction. It is a sparsely populated state of less than 700,000, known for cold weather and isolated farmers. Yet since 2000, the state's GNP has grown 56%, personal income has grown 43%, and wages have grown 34%. This year the state has a budget surplus of $1.2 billion.
North Dakota boasts the only state-owned bank in the nation. It has avoided the credit freeze by creating its own credit, leading the nation in establishing state economic sovereignty. The Bank of North Dakota was established by the state legislature in 1919 specifically to free farmers and small businessmen from the clutches of out-of-state bankers and railroad men. By law, the state must deposit all its funds in the bank, and the state guarantees its deposits. The bank's stated mission is to deliver sound financial services that promote agriculture, commerce and industry in North Dakota. The bank operates as a bankers' bank, partnering with private banks to loan money to farmers, real estate developers, schools and small businesses. It has ample money to lend to students (over 184,000 outstanding loans); it purchases municipal bonds from public institutions; and it makes loans at 1% interest to new farmers. The state's current governor was formerly president of the Bank of North Dakota.
In California and other states, workers and factories are sitting idle because the private credit system has failed. An injection of new money from a system of publicly-owned banks on the model of the Bank of North Dakota could thaw the credit freeze and bring spring to the markets once again.
Cash-starved states need to play the banking game:
north dakota shows how
1. ↑ "Money, Banking and Monetary Policy -- Everyday Economics," www.dallasfed.org/educate/everyday/ev9.html.
2. ↑ "Obama's Remarks on the Economy," New York Times, April 14, 2009.
3. ↑ Margrit Kennedy, Interest and Inflation-free Money (1995), discussed in Deidre Kent, "Margrit Kennedy Inspires New Zealand Groups to Establish Regional Money Systems," McKeever Institute of Economic Policy Analysis, www.mkeever.com (2002).
4. ↑ John Mitchell, "46 of 50 States Could File Bankruptcy in 2009-2010," Freedom Arizona (January 30, 2009).
Original article published as "But Governor, You CAN Create Money! Just Form Your Own Bank." on 29 May 09 Op Ed News
See also: "Revive Lincoln's monetary policy - an open letter to President Obama" of 9 Apr 09 by Ellen Brown (also published here), "Cash-starved states need to play the banking game:
North Dakota shows how" of 2 Mar 09, "Take back the power to create money from the private banking industry" - submission by Ellen Brown to President Barack Obama's Open Government Dialogue of of 29 May 09.
by Ellen Brown
Originally published on Global Research
Contents: Lincoln's Monetary Breakthrough, Building on a Successful Tradition, The Perennial Inflation Question, A Wake-up Call, Notes
Dear President Obama:
The world was transfixed on that remarkable day in January when, to poetry, song, and dance, you gazed upon Abraham Lincoln's likeness at the Lincoln Memorial and searched for wisdom to navigate these difficult times. Indeed, you have so many things in common with that venerable President that one might imagine you were his reincarnation in different dress. You are both thin and wiry, brilliant speakers, appearing on the national stage at pivotal times. Fertile imaginations could envision you coming back triumphantly as one of those slaves you freed, to prove once and for all the proposition that all men are created equal and can achieve great things if given a fighting chance. But as Wordsworth said, our birth is but a sleep and a forgetting; and if that is true, you may have forgotten a more subtle form of slavery from which Lincoln freed his countrymen, even if you were there at the time. You may have forgotten it because it has been omitted from the history books, leaving Americans ill-equipped to interpret the lessons of our own past. This letter is therefore meant to remind you.
We are now met on another battlefield of that same economic war that visited Lincoln and the Founding Fathers before him. President Obama, the fate of our economy and the nation itself may depend on how well you understand Lincoln's monetary breakthrough, the most far-reaching "economic stimulus plan" ever implemented by a U.S. President. You can solve our economic crisis quickly and permanently, by implementing the same economic solution that allowed Lincoln to win the Civil War and thus save the Union from foreign economic masters.
The bankers had Lincoln's government over a barrel, just as Wall Street has Congress in its vice-like grip today. The North needed money to fund a war, and the bankers were willing to lend it only under circumstances that amounted to extortion, involving staggering interest rates of 24 to 36 percent. Lincoln saw that this would bankrupt the North and asked a trusted colleague to research the matter and find a solution. In what may be the best piece of advice ever given to a sitting President, Colonel Dick Taylor of Illinois reported back that the Union had the power under the Constitution to solve its financing problem by printing its money as a sovereign government. Taylor said:
"Just get Congress to pass a bill authorizing the printing of full legal tender treasury notes . . . and pay your soldiers with them and go ahead and win your war with them also. If you make them full legal tender . . . they will have the full sanction of the government and be just as good as any money; as Congress is given that express right by the Constitution."
The Greenbacks actually were just as good as the bankers' banknotes. Both were created on a printing press, but the banknotes had the veneer of legitimacy because they were "backed" by gold. The catch was that this backing was based on "fractional reserves," meaning the bankers held only a small fraction of the gold necessary to support all the loans represented by their banknotes. The "fractional reserve" ruse is still used today to create the impression that bankers are lending something other than mere debt created with accounting entries on their books.1
Lincoln took Col. Taylor's advice and funded the war by printing paper notes backed by the credit of the government. These legal-tender U.S. Notes or "Greenbacks" represented receipts for labor and goods delivered to the United States. They were paid to soldiers and suppliers and were tradeable for goods and services of a value equivalent to their service to the community. The Greenbacks aided the Union not only in winning the war but in funding a period of unprecedented economic expansion. Lincoln's government created the greatest industrial giant the world had yet seen. The steel industry was launched, a continental railroad system was created, a new era of farm machinery and cheap tools was promoted, free higher education was established, government support was provided to all branches of science, the Bureau of Mines was organized, and labor productivity was increased by 50 to 75 percent. The Greenback was not the only currency used to fund these achievements; but they could not have been accomplished without it, and they could not have been accomplished on money borrowed at the usurious rates the bankers were attempting to extort from the North.
Lincoln succeeded in restoring the government's power to issue the national currency, but his revolutionary monetary policy was opposed by powerful forces. The threat to established interests was captured in an editorial of unknown authorship, said to have been published in The London Times in 1865:
If that mischievous financial policy which had its origin in the North American Republic during the late war in that country, should become indurated down to a fixture, then that Government will furnish its own money without cost. It will pay off its debts and be without debt. It will become prosperous beyond precedent in the history of the civilized governments of the world. The brains and wealth of all countries will go to North America. That government must be destroyed or it will destroy every monarchy on the globe."
Lincoln was assassinated in 1865. According to historian W. Cleon Skousen:
"Right after the Civil War there was considerable talk about reviving Lincoln's brief experiment with the Constitutional monetary system. Had not the European money-trust intervened, it would have no doubt become an established institution."
The institution that became established instead was the Federal Reserve, a privately-owned central bank given the power in 1913 to print Federal Reserve Notes (or dollar bills) and lend them to the government. The government was submerged in a debt that has grown exponentially since, until it is now an unrepayable $11 trillion. For nearly a century, Lincoln's statue at the Lincoln Memorial has gazed out pensively across the reflecting pool toward the Federal Reserve building, as if pondering what the bankers had wrought since his death and how to remedy it.
Lincoln did not invent government-issued paper money. Rather, he restored a brilliant innovation of the American colonists. According to Benjamin Franklin, it was the colonists' home-grown paper "scrip" that was responsible for the remarkable abundance in the colonies at a time when England was suffering from the ravages of the Industrial Revolution. Like with Lincoln's Greenbacks, this prosperity posed a threat to the control of the British Crown and the emerging network of private British banks, prompting the King to ban the colonists' paper money and require the payment of taxes in gold. According to Franklin and several other historians of the period, it was these onerous demands by the Crown, and the corresponding collapse of the colonists' paper money supply, that actually sparked the Revolutionary War.2
The colonists won the war but ultimately lost the money power to a private banking cartel, one that issued another form of paper money called "banknotes." Today the bankers' debt-based money has come to dominate most of the economies of the world; but there are a number of historical examples of the successful funding of economic development in other countries simply with government-issued credit. In Australia and New Zealand in the 1930s, the Depression conditions suffered elsewhere were avoided by drawing on a national credit card issued by publicly-owned central banks. The governments of the island states of Guernsey and Jersey created thriving economies that carried no federal debt, just by issuing their own debt-free public currencies. China has also funded impressive internal development through a system of state-owned banks.
Here in the United States, the state of North Dakota has a wholly state-owned bank that creates credit on its books just as private banks do. This credit is used to serve the needs of the community, and the interest on loans is returned to the government. Not coincidentally, North Dakota has a $1.2 billion budget surplus at a time when 46 of 50 states are insolvent, ...
Here in the United States, the state of North Dakota has a wholly state-owned bank that creates credit on its books just as private banks do. This credit is used to serve the needs of the community, and the interest on loans is returned to the government. Not coincidentally, North Dakota has a $1.2 billion budget surplus at a time when 46 of 50 states are insolvent, an impressive achievement for a state of isolated farmers battling challenging weather.3 The North Dakota prototype could be copied not only in every U.S. state but at the federal level.
The objection invariably raised to government-issued currency or credit is that it would create dangerous hyperinflation. However, in none of these models has that proven to be true. Price inflation results either when the supply of money goes up but the supply of goods doesn't, or when speculators devalue currencies by massive short selling, as in those cases of Latin American hyperinflation when printing-press money was used to pay off foreign debt. When new money is used to produce new goods and services, price inflation does not result because supply and demand rise together. Prices did increase during the American Civil War, but this was attributed to the scarcity of goods common in wartime rather than to the Greenback itself. War produces weapons rather than consumer goods.
Today, with trillions of dollars being committed for bailouts and stimulus plans, another objection to Lincoln's solution is likely to be, "The U.S. government is already printing its own money -- and lots of it." This, however, is a misconception. What the government prints are bonds -- its I.O.U.s or debt. If the government did print dollars, instead of borrowing them from a privately-owned central bank that prints them, Uncle Sam would not have an eleven trillion dollar millstone hanging around his neck. As Thomas Edison astutely observed:
"If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good, makes the bill good, also. The difference between the bond and the bill is that the bond lets money brokers collect twice the amount of the bond and an additional 20%, whereas the currency pays nobody but those who contribute directly in some useful way.
It is absurd to say that our country can issue $30 million in bonds and not $30 million in currency. Both are promises to pay, but one promise fattens the usurers and the other helps the people."
Henry Ford observed at about the same time:
"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."
Today we the people are starting to understand our banking and monetary system, and we are shocked, dismayed, and furious at what we are discovering. The wizard behind the curtain turns out to be a small group of men pulling levers and dials, creating an illusory money scheme that, behind all the talk and bravado, is mere smoke and mirrors. These levers are controlled by a privately-owned, unaccountable central bank called the Federal Reserve, which has recently dispensed billions if not trillions in funds to its banker cronies, without revealing where these monies are going even under Congressional inquiry or in response to Freedom of Information Act (FOIA) requests. As Chris Powell pointed out recently in conjunction with an FOIA request brought by Bloomberg News, which the Fed declined to comply with:
"Any government that can disburse $2 trillion secretly, without any accountability, is not a democratic government. It is government of, by, and, for the bankers."4
There was a time when private central bankers were the heavyweights in control, able to run their ultra-secret agenda with impunity; but that era is coming to an end. The bankers are scrambling, trying to patch up their crumbling creations with schemes, bailouts and sleight of hand. That effort, however, must ultimately prove futile. As investment adviser Rolfe Winkler said in a recent article:
"The great Ponzi scheme that is the Western World's economy has grown so big there's simply no 'fixing' it. Flushing more debt through the system would be like giving Madoff a few billion to tide him over. Or like adding another floor to the Tower of Babel. To what end? The collapse is already here. The question is: How much do we want it to hurt? Using the public's purse to finance 'confidence' in a system that is already kaput may delay the Day of Reckoning, sure, but at the cost of multiplying our losses. Perhaps fantastically."5
The bankers are on the run, feverishly trying to use the collapse of the current system to steer us toward an "Amero"-style North American currency, or a one-world private banking system and privately-issued global currency that they and only they control. We the people will not accept those solutions, however, no matter how bad things get. We demand real solutions that empower us, not further enslave us.
Abraham Lincoln had such a solution. President Obama, you can finally bring his monetary solution to fruition. Manifest the vision of Lincoln, Jefferson, Madison and Franklin, and we the people will make sure you are placed in the pantheon of our greatest leaders and are revered for all time. America's greatest days can still be ahead of us; but for this to happen, we need to expose and root out the deceptive banking scheme that would enslave us to a future of debt and increasing homelessness in this great country our forefathers founded. The time has come for democracy to rise superior to a private banking cartel and take back the power to create money once again. Such a transformation would represent the most epochal and empowering shift that humanity has ever seen. As you recently said:
"This country has never responded to a crisis by sitting on the sidelines and hoping for the best. Throughout our history we have met every great challenge with bold action and big ideas."
Your words are a timely reminder of our long legacy of action and bold solutions in the face of adversity. Can we do this? Yes we can.
For more information, see the writings of a variety of money reformers including David Korten, Richard Cook, Stephen Zarlenga, Michael Hudson and this author; articles collected at www.webofdebt.com/articles and www.GlobalResearch.ca; the documentary videos "The Money Masters" and "Money as Debt;" and proposed legislation by Congressman Dennis Kucinich to nationalize the Fed, and by Congressman Ron Paul to audit it (HR 1027).
Contents: Lincoln's Monetary Breakthrough, Building on a Successful Tradition, The Perennial Inflation Question, A Wake-up Call, Notes
1. ↑ See Ellen Brown, "Borrowing from Peter to Pay Paul: The Wall Street Ponzi Scheme Called Fractional Reserve Banking," www.webofdebt.com/articles (December 29, 2008).
2. ↑ Congressman Charles Binderup in a 1941 speech, "How America Created Its Own Money in 1750: How Benjamin Franklin Made New England Prosperous." Binderup quotes historian John Twells on this point.
3. ↑ E. Brown, "Turning the Tables on Wall Street: North Dakota Shows Cash-starved States How They Can Create Their Own Credit," www.webofdebt.com/articles (March 11, 2009).
4. ↑ Chris Powell, "Fed Refuses to Disclose Recipients of $2 Trillion," GATA (December 12, 2008).
5. ↑ Rolfe Winkler, "More Debt Won't Rescue the Great American Ponzi," Option Armageddon (March 9, 2009).
Special thanks to CC for his invaluable help with this article.
Ellen Brown developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and "the money trust." She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Her earlier books focused on the pharmaceutical cartel that gets its power from "the money trust." Her eleven books include Forbidden Medicine, Nature's Pharmacy (co-authored with Dr. Lynne Walker), and The Key to Ultimate Health (co-authored with Dr. Richard Hansen). Her websites are www.webofdebt.com and www.ellenbrown.com.
Ellen Brown is a frequent contributor to Global Research. Global Research Articles by Ellen Brown
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© Copyright Ellen Brown, webofdebt.com, 2009
The url address of the original article is: www.globalresearch.ca/index.php?context=va&aid=13118
Here is my letter to Professor Michael Archer, no reply forthcoming.
Dear Prof. Archer
I have read about the FATE program on your website and would like to share some comments.
Firstly, how can you consider this program to be helping conservation of kangaroos? How can 'sustainable use' apply to kangaroos when:
1. Their numbers have dropped up to 70% across the nation from 2001-2006 due to the drought and excess kangaroo 'culling' [1]?
2. Up to 80% females are killed. According to population experts killing 50% females is unsustainable [2]?
3. The report by The Australian Society for Kangaroos (a compilation of shocking facts from various government departments) clearly shows how kangaroos are on track to extinction. The fact that the biggest kangaroos have been shot out is proven by the fact that the average age of commercially killed kangaroos these days is only 2-3 years (21 kg) i.e. barely at reproductive age and just out of the pouch[3].
4. According to the Murray Darling Report, if kangaroos are killed in areas where there are less than 5 kangaroos per sq. km, that is a recipe for extinction. Yet kangaroos are being commercially killed in areas where there are less than 1 kangaroo per sq. km. [4].
Kangaroos are approaching, if not at, the tipping point beyond which kangaroos become extinct.
The FATE program will guarantee extinction for kangaroos. Entrusting the conservation of Australia's national icon to the very people who hate kangaroos the most (i.e. farmers) is like asking foxes to guard the proverbial hen house.
Australian government policy has already allowed 40% of native species to become extinct in a mere 220 years since the early settlers arrived. When are we going to wake up and stop this war against wildlife before it's too late?White man's ecological footprint in Australia has been way too large - we are going through the 6th mass extinction of all species due to human beings' total lack of consideration for and understanding of the ecosystem in which we live. Australian government policy has already allowed 40% of native species to become extinct in a mere 220 years since the early settlers arrived. When are we going to wake up and stop this war against wildlife before it's too late?
Why would people come to Australia and spend $85 billion tourist dollars each year just to go to shopping malls, theme parks and zoos when those attractions exist in any other country?It's time to end the ridiculous policy of making wildlife pay their way with their lives by becoming renewable resources to plunder for profit till none remain. If we don't become proper custodians of the land, we will lose our most precious treasure - our unique native animals. Why would people come to Australia and spend $85 billion tourist dollars each year just to go to shopping malls, theme parks and zoos when those attractions exist in any other country? What makes Australia special is our iconic wildlife, in the wild and in hordes!
What will happen when they become extinct? Shall we replace the kangaroo with a cow? Leaving an extinct animal on our national emblem would be too painful a reminder of our collective stupidity.Professor Archer, with all due respect, do you really want to go down in history as the man who drove the last nail in the kangaroos' coffin? Kangaroos are the second most recognised international tourist symbol. We proudly bear them on our emblem and QANTAS jets fly all over the world with the image of a kangaroo on their tails. What will happen when they become extinct? Shall we replace the kangaroo with a cow? Leaving an extinct animal on our national emblem would be too painful a reminder of our collective stupidity. Perhaps now would be a good time to start contemplating what other animal should replace the kangaroo that is as popular and well known? Perhaps cane toads, foxes or how about concrete?
On Australia Day, today, we should be considering how to protect our national treasures, not eating them and feeding them to our dogs. The FATE program encouraging 'harvesting' of our native animals is a mistake of mammoth proportions.
Thank you for your consideration.
Menkit Prince
1. www.environment.gov.au/biodiversity/trade-use/wild-harvest/kangaroo/population/index.html
2. H.H.Lavery 'The Keepers'
3. www.stopkangarookilling.org
4. AAT Submission, General Administration Division, NSW District Registry, No. 535 of 2007 (exhibit 13).
Re Murray Darling Report on quasi extinction - www.kangaroo-protection-coalition.com/nswaatappeal2008.html
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