Saturday, April 25, 2009


Dear readers of “New View on Money”,

Pasted in below (for those unable to open the attachment) is a note from my colleague, Stuart, on the virtual eve of the introduction of the “Concord Resolution” at the town meeting of April 27 in Concord, Massachusetts. This locale for the bringing of the question of whether money might be issued publicly for the common good is particularly apt, as it was the colonial government of Massachusetts in the year 1690 that became the first government in the Western world to issue its own paper currency. The founding economic principle of a great nation was thus conceived. The “shot heard ‘round the world” at Lexington/Concord gave notice of its birth eighty-five years later. The issuance of the “Continental Currency”, the first national scrip,
commenced barely two months after.

Surely, the likelihood of this untested idea gaining a toehold in the earth, winning the hearts and minds of the People, and eventually transforming their affairs, must have seemed at least as “impossible” to our forebears then as the prospects for “getting the politicians to listen” are to us now; but the Minutemen mustered. How different would history have been if they had given way to cynicism, calculation and despair, and stood down because exercising their sovereign monetary franchise in the face of opposition by the most powerful empire in the world was deemed to be too daunting? Would there even be a nation in America, or only “third-world” enclaves, perpetually in “debt” to a private banking order? In the current financial crisis, has the question of who would issue the nation’s money, in what manner, and for whose welfare been visited upon us yet again?

Rich Kotlarz


“Listen my friends, and you shall hear,
of the mid-night ride of Paul Revere
On the 18th of April in ’75 . . . .”

Henry Wadsworth Longfellow

Dear Friends,

We write in the aftermaths of Patriot’s Day. Over the last months you have received Rich’s column: “New View on Money.”

On a number of occasions, Rich mentioned our work with the “Concord Resolution”, which seeks to contribute, at long last, to the healing of our financial system, by addressing what we see as the very heart, “life-blood”, of the problem-challenge and, above all, the opportunity facing our nation today.

That is: the renewal of our public works, infrastructure, our foundations in the only longer term way possible: through the redemption of our privately controlled, debt-based, money system.

The resolution has been developed, so as to be adapted and adopted (including its very name e.g. "Kalamazo Resolution") in communities across the nation.

We write to invite you to contribute to this healing process, this process of renewal, by:

1) Reviewing the resolution at

2) If you see not only its merit, but believe it could serve your community or county and are willing to share it with neighbors and friends (both near and far), kindly let us know . . . .

3) ASAP. A brief response before Monday evening, April 27 would be a blessing, indeed. That is when we bring the “Concord Resolution” to Concord’s Town Meeting. If we can report at the meeting that fellow citizens in communities – 5, 10, 15, 20, 30, 50, 100 or more . . . – across the country are, at the very least, turning to the Concord Resolution and beginning to consider its merits, that fact will serve – IMMEASURABLY – our labors here in Concord. I trust that engagement of which I speake is clear.

So it was on that April morn of which Longfellow writes. Reinforcements, Minutemen (aptly named) arrived not only “from every Middlesex village and farm” but from as far north as New Hampshire and Vermont -- a stone's throw, and more, in Colonial Days.

If, friends, there is any time to enact the monetary reform that Rich has been writing about and, I trust, we all seek, this may be it. Such was Congressman Dennis Kucinich’s conclusion following our March meeting with him; such was the feeling, we sensed, that rose in author Doris Kearns Goodwin’s good heart at her parting embrace last week.

An unprecedented window of opportunity opens before us – if We the People are able to rouse ourselves from, and to, our dream. May it be so!

Our heartfelt thanks for your consideration.


Stuart-Sinclair Weeks
Founder, Center for American Studies
Concord, Massachusetts, USA

“By the rude bridge that arched the flood;
It’s flag to April’s breeze unfurled,
Here once the embattled farmers stood,
And fired the shot heard ‘round the world.”

Ralph Waldo Emerson, Concord Hymn

* * * * *

P.S. The Resolution and Brief Presentation Follow.


Mr. Weeks moves: that the Town vote to petition its Congressional representatives to submit legislation in order to establish a process, whereby Concord and other local governments will be able to fund their duly authorized public works projects publicly, that is from monies created and loaned directly out of the US Treasury in accordance with the power of Congress to coin money and regulate the value thereof.

Public Loans Directly From Our Public US Treasury, As Opposed to Through the Private Bond Market

Think Globally; Act Locally.



1) NO RISK, first and foremost:

^ Having given resolution our best, Congress determines its fate;

^ Not tied into that fate. Can stick with bond market.


2) Tax relief due to savings of interest on the bonds, totaling $8.5 million 2008-2112.

3) Proceed more readily with duly authorized public works projects;

4) Renewal of our infrastructure/foundation as a community and nation;


5) Essential step taken to turn-around economy: return control of our nation’s money supply to our publicly elected representatives, as envisioned by our Constitution: “Congress . . . . shall have the power to coin money [and] regulate the value thereof.”

6) Cornerstone set for a revitalized economy in which money serves people, as opposed to people increasingly obliged to serve money.

Globally: “. . . . And fired the shot heard ‘round the world.”

7) Concord’s legacy carried on in service to our children, generations to come.

To whom much is given, much is expected.


1) Wasted stamp that sends Concord Resolution to our congressional rep.

2) Other . . . ?

Q: You’re proposing reform of our current financial system?

A: Yes, for reasons:

1) System broken;

2) Worsening predictions;

3) We’re affected, growing distress;

4) Experts increasingly acknowledge they don’t have answer;

5) Someone has to come up with solution;

6) Is not ours a government, as Lincoln said, “of, by, and for the people”?

7) Monetary reform other unavoidable and indispensable side of the public works “coin”. . .

8) . . . . If more than a short-term, self-serving, band-aid approach to infrastructure is sought;

Example: The "shovel-ready projects” digging us into deeper hole/debt. Its stimulus money borrowed from Fed.

Q: Congress can make such loans now if it wants?

A: Yes. And nearly a century of experience since the passage of the Federal Reserve Act has shown that it won’t -- unless We the People speak up.

This conclusion confirmed by our recent visit to 6 Congressional offices. Their responses:

A) Little familiarity with the idea of public funding of our public works;

B) Nevertheless, see that financial system is a mess; self-interest rules, as opposed to the public interest;

C) Immediate sense that “Concord Resolution” onto something fundamental;

D) Express desire to be kept informed;

E) Clear counsel: little possibility without real support from the constituents, us.
Surprise? “When the people lead, the leaders will follow….”

Monday, April 20, 2009


We the People:

In Response to President Obama’s Request for Economic Solutions from the Citizenry


“The government [not private banks] should create, issue, and circulate all the currency and credit needed to satisfy the spending power of the government and the buying power of the consumers. The privilege of creating and issuing money is not only the supreme prerogative of government, but it is the government's greatest creative opportunity. By the adoption of these principles, the long-felt want for a uniform medium [of exchange] will be satisfied. The taxpayers will be saved immense sums of interest. The financing of all public enterprises, and the conduct of the Treasury will become matters of practical administration. Money will cease to be master and become the servant of humanity.”
- Abraham Lincoln, as attributed in Senate Doc. 23, 76th Congress

In the providence of Nations, each brings to humankind a gift. It is the destiny of America to establish in the earth a threefold social order to bring, first, a new birth of freedom, second, the rule of democratically determined law, and third, an economic life that nurtures individual liberty and provides for the common good. It is the neglect of this third dimension of the American experience via the abdication by Congress of its Constitutional power to create and issue the public’s own money that is at the root of unprecedented distress in the economic life of the nation, and, by extension, the world.

Accordingly, We the People of these United States, mindful of the hopes and prayers of millions around the world, do resolve to restore the economic providence of the American nation.

In 1690 the colonial assembly of Massachusetts became the first government in the Western world to issue its own paper money. It was based, not on precious metals, debt bonds, land parcels, or other privately controlled “backing” schemes, but on the need for a stable currency issued in proportion to commerce, the general welfare and human dignity. Massachusetts prospered, and its example was copied by its sister colonies. A protracted contention ensued between the American Colonies and the Mother Country to determine who would exercise the sovereign right to create and control the “coin of the realm”, and for whose benefit that power would be exercised.

Representatives of the Colonies gathered at the Second Continental Congress in Philadelphia in June of 1775 and claimed the prerogative of the sovereign by issuing a new currency by fiat of the public will, the “Continental Currency”. A nation was effectively born, and the famed Declaration of July 4, 1776 followed.

Benjamin Franklin stated the root of the matter succinctly: “The Colonies would gladly have borne the little tax on tea and other matters had it not been that England took away from the Colonies (the right to issue) their money, which created unemployment and dissatisfaction.”

The struggle over the control of money was revisited time and again as the new nation evolved. Fateful events transpired around the chartering and eventual rejection of the First and Second Banks of the United States, financing of the Civil War, emergence of the Populist Movement, passage of the Federal Reserve Act in 1913, the money and banking legislation of the Depression era, the “farm parity” monetary reform of the WWII and demobilization period, and the slide into an unbearable burden of private and public indebtedness, which has culminated in the monetary crisis we face today.

Furthermore, there are specific passages established already in the law by which the current monetary distress, can, and indeed is called to be relieved:

On June 4, 1963, President John F. Kennedy signed Executive Order 11110, which invoked “The authority vested in the President by paragraph (b) of section 43 of the [Agricultural Adjustment] Act of May 12, 1933,” passed under Franklin Delano Roosevelt.

This Agricultural Adjustment Act specifically directs the President to take whatever measures he deems necessary to protect the value of the currency of the United States, and states further in Sec. 43, Par. (b) that if he is unable to secure the cooperation of the Federal Reserve Board, or for any other reason determines that additional measures are required, he is specifically authorized:

“To direct the Secretary of the Treasury to cause to be issued in such amount or amounts as he may from time to time order, United States notes, as provided in the Act entitled ‘An Act to authorize the issue of United States notes and for the redemption of funding thereof and for funding the floating debt [bonds against the debt] of the United States,’ approved February 25, 1862. . . but notes issued under this subsection shall be issued only for the purpose of meeting maturing Federal obligation to repay sums borrowed by the United States and for purchasing United States bonds and other interest-bearing obligations of the United States: Provided, That when any such notes are used for such purpose the bond or other obligation so acquired or taken up shall be retired and canceled.”

Taken to its logical end, the effect of this act is to specifically authorize, and indeed direct, the President to redeem Federal bonds with United States Notes as they come due if a stable currency is not achieved under the auspices of the Federal Reserve. It outlines a process whereby the debt of the Federal government can be retired in an orderly manner, and debt-bearing Federal Reserve Notes replaced in the money supply with lawful US currency.

Kennedy’s executive order caused to be issued directly out of the US Treasury over $4 billion in non-interest-bearing United States Notes, in this case Silver Certificates. Further issues were halted shortly after his death.

Significantly, the ‘Act of February 25, 1862’ cited in this 1933 legislation is Lincoln’s original “Greenback Act”, by which he declined to borrow the money to finance the Civil War, and instead issued $450 million in United States Notes. Had he acted otherwise, the debt from that war would remain as a burden of the Federal Government to this day, compounded by interest charges to many times its original amount. Lincoln’s leadership may well have redeemed the Union, on the battlefield, and in the financial arena as well.

The Acts referred to above cite as their authority the power delegated to Congress to “coin Money (and) regulate the Value thereof . . .”, as stipulated in the United States Constitution. They remain the law of the land. Why then, it is fair to ask, are they not being implemented in this time of crisis?

We the People uphold the Constitution of the United States and the intent of the laws derived therefrom. Further, we support President Obama in his promise, stated during his February 24th, 2009 address to the Joint Session of Congress, to do “whatever it takes” to address our current economic crisis.

In the practical spirit of “whatever it takes”, immediate steps can be duly taken (the issuance of United States Notes to redeem outstanding Federal debt) as an emergency measure under the Agricultural Adjustment Act, until a more permanent solution can be effected by repealing the Federal Reserve Act, and returning the creation and issuance of the people’s own money to the public domain through the US Treasury.

Furthermore, the people and physical assets of the Federal Reserve can be incorporated into the Department of the Treasury, where they would continue to assist with administering our nation’s monetary policy, but now subject to the People’s will through our duly constituted system of checks and balances. It is this form of monetary system, we believe, that our most far-sighted and public-spirited Founding Fathers envisioned.

In the spirit of “With malice towards none”, this statement represents, not a condemnation of any segment of society, including bankers (whose due services will continue to be needed). Rather, it seeks to fulfill the American providence to establish a new economic principle on the earth whereby “government of the people, by the people, for the people, shall not perish” from falling under the control of the “moneylender”. It is alike in the best interests of all citizens of our nation, and in these times the world, that such a new economic order be at last established.

“The weight of this crisis”, President Obama stated in his February 25, 2009 address to the Joint Session of Congress, “will not determine the destiny of this nation. The answers to our problems don’t lie beyond our reach. They exist in our laboratories and universities; in our fields and our factories; in the imaginations of our entrepreneurs and the pride of the hardest-working people on Earth. Those qualities that have made America the greatest force of progress and prosperity
in human history we still possess in ample measure. What is required now is for this country to pull together, confront boldly the challenges we face, and take responsibility for our future once more . . . , that day of reckoning has arrived, and the time to take charge of our future is here . . . .

So I ask this Congress to join me in doing whatever proves necessary. Because we cannot consign our nation to an open-ended recession . . . . As we stand at this crossroads of history, the eyes of all people in all nations are once again upon us – watching to see what we do with this moment; waiting for us to lead . . . , in our hands lies the ability to shape our world for good or for ill.”

Richard Kotlarz

1904 1st Ave. S, #12
Minneapolis, MN 55403


The complete set of columns from this series is posted at the following websites.


(January 30, 2009)

Other commitments bid that this be the last column before I take a two-week hiatus. I plan to resume the series on February 20 (though I reserve the option to send out commentary in the meantime if emerging events call for it). Much has transpired in the world between the last break in October and now. This is perhaps a good introspective winter's time to take what has been said into our contemplations and meditations.

Last fall the economic dispensation of the world changed. Now we are informed in the media daily of the mounting national, and now worldwide, "debt" crisis, the further loss of homes and businesses, and the latest waves of job losses. There have been enough paychecks and other financial resources still in the pipeline to maintain a sense of normalcy through the holiday season, and through the Presidential inauguration. Our attention now turns naturally to the
question, "What will the year ahead bring?" To be sure, the signs are by most reckonings far from positive, but a time of maximum crisis is also a time of greatest opportunity.

I would leave you for now, dear friends, with a note of perspective. In the course of the columns many strong statements have been made. This is not surprising given the vital nature of the subject. I would emphasize, however, (as I have done before) that there are no enemies in the monetary story; only a perverse principle that we, virtually all, have in our own lives and niches become subject to: that is, the idea that life is limited and controlled by money, rather than money being an extension of life. Its effects range from overt thievery, to the most subtle deceptions of the soul. There are none, as far as I know, who have not to some extent at least lived in a glass house on this matter. Who then can cast a stone of judgement? It is altogether fitting then that we move forward with the attitude of removing the beam from our own eye, before attempting to pluck the mote from our brother's or sister's.

Throughout this series of columns I have interjected the American story about money. This is particularly so in the last three installments, where I have drawn out the monetary thread in a manner that reads somewhat like a heroic tale. Indeed, there is heroism in this litany of historical events, but, of course, life is not that simple. There would have been many nuances, contrary weavings and instances of human mendacity along the way, if the truth were fully

My intention is in part to precipitate a new American mythology, which is the story that we tell our children, each other, and the world about who we are and how we got to be this way. I would not, however, that it be a new American jingoism. We as a nation have our unique tale to tell and our contribution to make. Indeed, the case may be made that a new way of doing money is a particular gift that this nation has to offer the world, as part of our "manifest destiny", if you will.

But even in this area, that is not the whole of the story. The evolution of money can be traced back to other times and lands. Some of the thoughts and practices "pioneered" by Americans had significant antecedents of various forms in, for example, ancient China, early classical Greece, the pre-empire Roman Republic and the Islamic civilization of the Middle Ages. The argument over the creation, issuance and control of money in colonial America was in essential ways the coming to a head of a contention that had already taken place in England and France for several centuries, and many of its ideas can be traced from there.

What is more, the American Revolution was not a battle pitting, simplistically, the good guys against the bad. It was, rather, a struggle between heroic people on both sides. This was a soul-wrenching time, and some of the most venerated of our "Founding Fathers" felt rent within by opposing viewpoints, sympathies and loyalties. From a larger perspective, even King George could make a reasoned and passionate argument for his case.

The tenor of these articles might, if one is not fully attentive, be taken to be a screed against bankers and banking. Let me be clear: the enemy is not bankers or banking. In the current monetary crisis is it not true that many banks also are going bankrupt? If I have an attitude regarding the institution of banking, it is not to tear it down, but to see it redeemed for the sake of the People, including the bankers themselves. If we do not engage the financial world constructively, but opt instead for the gratification of comeuppance, we will pull the monetary temple down on our own heads.

In this modern age we are essentially all economic players, and have in our own particular ways and niches contributed to the distressed circumstances that are unfolding in our financial lives at present. Even withdrawing to the woods to live a hermit's life is a profound economic act. Certainly the simple use of a credit card has significant implications, of which we need to become fully conscious if the current "debt" crisis is to be addressed. Let us resolve, then, to take responsibility for our own role in the economic order, and to not blame the other.

In my perception, all the major dilemmas of today converge upon the same question, and that is: "What can we do about money?" Could it be that the outbreak of the present world financial chaos, in conjunction with the belief in new possibilities that seems, for whatever providential reason, to attend the latest change in government in Washington, constitutes a priceless opportunity? I don't know. That question remains for us to answer. I have a feeling, though, that whether we seize upon it in a constructive, as opposed to blame-saying, manner will make all the difference. To be sure, we need to remain discerning and not withhold a critique when it is due, but cynicism holds no power for good. It behooves us always to be mindful of the distinction. There is no reason, in my view, to think that this time of crisis could not be redeemed, and become known to future generations as the year the world finally turned around. I offer this as something to think about, until we reconvene.

Thank you all for your continued interest. I love you, every one.

Looking forward to resuming the conversation,

Richard Kotlarz
1904 1st Ave. S, #12
Minneapolis, MN 55403

The complete set of columns from this series is posted at the
following websites.

Monday, January 26, 2009


(Week 25 - Monday, Jan. 26 / 2009)

History, it might be said, is not merely a chain of happenstance, but can be thought of as a meaningful weaving of times, people and events that reveal the workings of providence in worldly affairs. Such is strongly suggested by the American experience. What lesson does it have for us does at this paradoxically auspicious moment of crisis?

Time and again this nation has arrived at a juncture where it was threatened outwardly by affairs seemingly beyond its control. At each such reckoning, I would suggest, it has saved itself by a return to the monetary inspiration that gave it birth.

In 1690, when the seed of what we call the United States was a thin line of struggling settlements along the eastern seaboard, one colony, Massachusetts, became the first government in the Western world to issue paper money. These "bills of credit" were a public scrip whose purpose was to facilitate, not the designs of private interests, but the commonweal of the People. The colony prospered, the practice was adopted by its neighbors, and the beginnings of a new nation germinated.

In 1775, the Crown and Parliament of England had effectively forbidden the Colonies to issue their own money, save with the approval of the Crown and Parliament. This resulted in widespread economic distress, and threatened the undoing of the nascent social order the colonists had painstaking constructed. In response they called a Continental Congress, which then issued a "Continental Currency". This exercise of the monetary power was effectively the assumption of national sovereignty, and the first defining act of a new nation. The political separation heralded by the Declaration of Independence in 1776 followed as a matter of course.

In 1836, the charter for the Second Bank of the United States (modeled after the Bank of England) came up for renewal in the Congress in a bid to become a permanent American institution. It was vetoed by President Jackson whose campaign slogan was, "Bank and no Jackson, or no bank and Jackson". He had asserted:

"The bold effort the present bank had made to control the government, the distress it had wantonly produced . . . are but premonitions of the fate that awaits the American people should they be deluded into a perpetuation of this institution or the establishment of another like it."

Jackson's veto had the effect of putting off for almost eight decades the day when the country would have "another like it".

In 1860, the United States faced the challenge of whether the ". . . new nation, conceived in Liberty, and dedicated to the proposition that all men are created equal . . . can long endure". Outwardly it was a military conflict between the Union and the Confederate States. On a deeper level, it was a battle over how and by whom money would be created and issued. Financial interests had worked to divide the states between North and South, thereby undermining the American example of a nation made strong and independent through the power to issue its own money. President Lincoln was pressured to borrow the funds to fight the war, but responded instead by creating $450 million in "Greenbacks", a public currency issued directly by the government, much like the Continental Currency. Had he succumbed, this sum would still theoretically be part of the "national debt", but compounded to an amount many times the original. In practical terms it would likely have caused the financial ruination of the nation that was supposedly saved on the battlefield.

In 1896, at the Democratic nominating convention in Chicago, dark-horse Presidential candidate Williams Jennings Bryan declared in his famous Cross-of-Gold speech:

"The gold standard has slain its tens of thousands. If they ask us why we do not embody in our platform all the things that we believe in, we reply that when we have restored the money of the Constitution, all other necessary reforms will be possible, but until this is done there is no other reform that can be accomplished."

The assembled gathering thundered its approval, and on the strength of this position, Bryan went on to win the Democratic nomination three times. This was the high point of the widespread Populist movement that had formed up following the Civil War virtually around the issue of preserving the Greenback as a national institution, and resisting the imposition of a gold standard on money by the banking establishment.

In 1942, the nation was still struggling to emerge from the Great Depression, a collapse brought on, many believe, by the establishment of a monetary system based on "debt" through the Federal Reserve Act of 1913. With the images of battleships burning at Pearl Harbor still fresh in mind, Congress was persuaded to pass the Steagall Amendment to the Stabilization Act of 1942, which established a parity price (one that would cover the cost of production, living expenses and seed for another round) for 45 basic raw materials, including the 25 most basic storable agricultural commodities. The domestic gold standard having collapsed in 1933, the value of the dollar was thus effectively reestablished on the basis of the actual economic worth of real commodities fairly monetized. The result was that the economy roared to life, and continued to prosper even during demobilization, post-war reconstruction, and the Korean War emergency. President Truman even balanced half of his budgets.

Now it is 2009. The legislation that established the "parity dollar" was undone in the early fifties, and the long slide into our present crushing "debt" began in earnest. The current financial crisis is not the first time that we as a nation have faced a threat to our essential well-being, or even very existence. In response to such crises in the past - 1690, 1775, 1836, 1860, 1896, 1942 – the nation saved itself by harkening back to its original monetary inspiration, each time taking the application of the principle a bit higher.

The providential import of this time is being felt across the land, as evidenced by the impulse on the part of millions of people to come together in thousands of gatherings, large and small, in Washington DC and across the nation (not to mention around the world). They are it seems, regardless of partisan feelings, intent on sharing in the momentousness of this week's Presidential inauguration. That being so, a question yet hangs heavy over the land - "What do we do now?"

At this auspicious juncture the nation more than ever needs to return, as it has always done, to its monetary roots for the answer, but, incredibly, we seem to have largely forgotten our own authentic heritage. It needs to be rediscovered, and taken to new heights of realization very soon.

Richard Kotlarz

1904 1st Ave. S, #12
Minneapolis, MN 55403


The complete set of columns from this series is posted at the following websites.

Friday, January 23, 2009


(Week 24 - Friday, Jan. 23 / 2009)

History has a rhythm. In the past one can find the prologue of what is coming to pass now.

The early American colonists found themselves economically in a desperate condition. They were essentially stranded on the eastern edge of a vast new land, with bounteous resources, but little money to carry on the commerce required to develop them and provide a new life. Trade with the mother country proved to be a one-sided affair. The raw materials the colonies had to offer were sold cheaply, but imported finished goods were expensive. Without a domestic source of coinage, what few coins the colonies earned in trade quickly disappeared back to England, and they were obliged to sink ever further into debt to keep their economy going.

The colonial assembly of Massachusetts was inspired to come up with a simple, but effective solution to the chronic shortage of circulating medium. In 1690, it began to issue the first government-authorized paper currency in the Western world. It was not based on precious metals, debt paper, land banks, promises to pay interest, or other "backing" schemes, but issued instead to facilitate the commerce of the People. These "bills of credit", as they were called, were simply printed and spent into circulation.

The experiment proved to be successful and was copied by all the other colonies. Eventually, their respective monies began to be recognized and accepted by each other. As trade up and down the Atlantic seaboard increased, these isolated and indentured resource enclaves began to be transformed into a fledgling new nation. When asked about how he could explain the prosperous condition of the colonies, Ben Franklin replied:

"That is simple. It is only because in the Colonies we issue our own money. It is called colonial scrip, and we issue it in proper proportion to the demand of trade and industry."

The Crown set itself in continuous opposition to these unapproved issues and Parliament passed laws in an attempt to curb them. The Currency Act of 1764 banned the extension of legal tender status beyond certain dates, and England assumed the authority to approve or disapprove any laws the Colonies might pass related to new issues. Its foot dragging on such measures effectively deprived the Colonies of their money, and led to the first two now-uncomprehended justifications for going to war as set forth in the Declaration of Independence, specifically:

(1) - He has refused his Assent to Laws, the most wholesome and necessary for the public good.
(2) - He has forbidden his Governors to pass laws of immediate and pressing importance unless suspended in their Operation till his assent should be obtained; and when so suspended he has utterly neglected to attend them.

Senator Robert Owen, prominent banker and the first chairman of the Senate Committee on Banking and Currency, explained that when the Rothschild-controlled Bank of England heard of the situation in the Colonies:

"They saw that here was a nation that was ready to be exploited; here was a nation that had been setting up an example that they could issue their own money in place of the money coming through the banks. So the Rothschild Bank caused a bill to be introduced in the English Parliament which provided that no colony of England could issue their own money. They had to use English money. Consequently the Colonies were compelled to discard their script and mortgage themselves to the Bank of England in order to get money. For the first time in the history of the United States our money began to be based on debt."

"Benjamin Franklin stated that in 1 year from that date the streets of the Colonies were filled with unemployed."

Faced with a deteriorating economic situation, and what they felt was British neglect, the colonists called a Continental Congress, and issued the Continental Currency. This differed from earlier colonial monies in that it was an emission of the Colonies as a whole. This act was, essentially, the assumption by the people of American nationhood. According to monetary historian Steve Zarlenga:

"The skirmishes at Lexington and Concord are considered the start of the Revolt, but the point of no return was probably May 10, 1775 when the Continental Congress assumed the power of sovereignty by issuing its own money."

Americans are commonly aware that the establishment of the United States brought to the world a new type of democratic order; i.e. personal freedom under the rule of democratically determined law. What is not nearly as widely realized is that it also represented the establishment of a new economic order. It sought to secure not only freedom and law, but also the means to same; i.e. the control of its own money. This is the all-but-forgotten "rest of the American Revolution".

This was elaborated eloquently in "Harmony of Interests", by Henry C. Cary, who was Abraham Lincoln's economic advisor and the son of Matthew Cary, a close collaborator of Franklin and LaFayette. He stated that there are "Two systems before the world", and proceeds into a lengthy delineation which concludes:

"One looks to pauperism, ignorance, depopulation and barbarism; the other to increasing wealth, comfort, intelligence, combination of action, and civilization. One looks towards universal war; the other towards peace. One is the English system; the other we may be proud to call the American system, for it is the only one ever devised the tendency of which was that of elevating while equalizing the condition of man throughout the world."

And what is this "American system" compared to the "English system"? I describe the former as an economic order based on the sovereign power of a nation to issue its own money, and the latter as the subjugation of society to unpayable "debt" to private interests. It is one of the great ironies of history that, through its privately-issued "debt"-based dollar, we as a nation have become effectively the champion worldwide of the "English system", the very economic order we purport to have triumphed over more that two centuries ago. It seems now that with the advent of the current financial crisis, the final reckoning of which principle we will serve has come upon us in a way that cannot be evaded.

Our forbearers were mindful of what is at stake. Thomas Jefferson had this to say:

"I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a monied aristocracy that has set the Government at defiance. The issuing power should be taken from the banks and restored to the people to whom it properly belongs."

"If the American people ever allow the banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers occupied."

John Adams wrote in a letter to Jefferson:

"All the perplexities, confusion, and distress in America arise, not from defects in the Constitution or confederation, not from want of honor and virtue, so much as from downright ignorance of the nature of coin, credit and circulation."

Might this be something for our new President contemplate? How else "Hope"?

Richard Kotlarz

1904 1st Ave. S, #12
Minneapolis, MN 55403


The complete set of columns from this series is posted at the following websites.

Wednesday, January 21, 2009


(Week 24 - Wednesday, Jan. 21 / 2009)

It takes the events, sacrifices and spent lives of many years to make a day like today. How many years? It depends on how one reckons.

One could say that it took forty years since the murder of Dr. Martin Luther King to finally see a black man rise to America's highest civil office, an Exodus-length time of wandering in a political wilderness towards a civil-rights promised land.

One could say that it has been a century-and-a-half from Lincoln, the "Great Emancipator", to Obama, the "Great Emancipation".

One could say that it was well over two centuries from the penning in our founding document of the words "All men are created equal", to the day when they could resound with an undampened ring.

We could go on with this exercise (get carried away with it, some might say) of casting the net of history ever wider to gather it in as the prologue to what culminated today in the inauguration of our new President. None of this is to say that what transpired in Washington was in a mundane sense anything more than the ensconcing in office of yet another administration, that it might not succeed or fail in the manner of all such political tenures, or even that the right guy won the election (clearly not everyone agrees that that was the case).

Whatever the truth, all that, it seems, was set aside as the feeling of momentousness of this day was allowed to play out. I experienced it in a crowd of approximately three-hundred people who came together to share in the experience in a neighborhood community center, and this sort of event was reportedly repeated in many thousands of gatherings across the nation, and around the world.

I was born and raised in Illinois, the home state of both Lincoln and Obama. I can imagine that there was a sense of historic euphoria that attended Lincoln's day of ascension to the office also, but the nation then, as now, was in a state of deepening crisis, and there were daunting realities to be faced when the festivities were over.

My purpose here is not to in any way make a personal comparison between Abraham Lincoln and Barack Obama, as to do so would be to commit an injustice to both men. Each is his own person in his own unique time, and the achievements and failures of the first say nothing about what might be achieved or failed by the second. Lincoln's record as President has been written; Obama's has yet hardly a mark.

Yet, I find that the feeling of a providential connection between the two men cannot be avoided. Lincoln took office at the leading edge of a crisis that was unprecedented in intensity and scope, and indeed threatened the very existence of the nation. Obama is faced (arguably) with problems every bit as dire and intractable, and this time on a worldwide scale. The outward manifestations of the irrespective challenges are very different, but a common thread runs through them; that is, at their core is the fundamental question of how we as a nation create and issue our money. This indeed has been the quintessentially American question since early Colonial times.

The outbreak of the Civil War demanded that some way of financing it be found. Though under great pressure to borrow the funds from the private banking system, Abraham Lincoln instead had the Treasury issue $450 million dollars in "United States Notes", popularly known as "Greenbacks". The monetary policies of Lincoln are a generally overlooked, but pivotal part of our history. Indeed, they may have been, as much as his better-known proclamations, a crucial factor that allowed the Union to prevail. Reportedly, Lincoln had much to say regarding the public-vs.-private issuance of money which we would do well to contemplate today:

"Money is the creature of law and the creation of the original issue of money should be maintained as an exclusive monopoly of National Government."

"Government possessing the power to create and issue currency . . . need not and should not borrow capital at interest as the means of financing governmental work and public enterprise. The Government should create, issue and circulate all the currency and credit needed to satisfy the spending power of the Government and the buying power of consumers. The privilege of creating and issuing money is not only the supreme prerogative of Government, but it is the Government's greatest creative opportunity."

"The taxpayers will be saved immense sums in interest . . . Money will cease to be master and become the servant of humanity. Democracy will rise superior to the money power."

Congressman Wright Patman, former chairman of the House Committee on Banking and Currency, commented a century later:

"If instead of issuing 'greenbacks,' the Lincoln administration had issued the interest-bearing bonds, as urged, naturally, these bonds would still be a part of the Federal debt today."

At compounded "interest", the amount would be many times greater. The significance of Lincoln's monetary policy did not escape notice in certain European quarters, although from an entirely different perspective. There appeared in The London Times during the Civil War the following from Otto Von Bismarck:

"If that mischievous financial policy, which had its origin in the North American Republic (the public issue of usury-free currency) should become indurated down to a fixture, then that Government will furnish its own money without cost. It will pay off debts and without a debt. It will have all the money necessary to carry on its commerce. 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."

In 1876, Bismarck explained further:

"The division of the United States into federations of equal force was decided long before the Civil War by the high financial powers of Europe. These bankers were afraid that the United States, if they remained in one block and as one nation, would attain economic and financial independence which would upset their financial dominance over the world. The voice of the Rothschilds prevailed. They saw tremendous booty if they could substitute two feeble democracies, indebted to the financiers, for the vigorous Republic which was practically self-providing. Therefore, they started their emissaries in order to exploit the question of slavery . . . Lincoln's personality surprised them. His being a candidate had not troubled them; they thought to easily dupe a woodcutter. But Lincoln read their plots and understood that the South was not the worst foe, but the financiers."

Lincoln agreed:

"I have two great enemies, the southern army in front of me and the financial institutions in the rear. Of the two, the one in the rear is the greatest enemy."

There is, I believe, a lesson from Lincoln's experience for our new President. It concerns the necessity of returning the function of creating and issuing of our nation's money to the public sector. This is the essential key (as I have touched upon repeatedly) to redeeming the financial crisis the nation currently faces. I am disheartened in the sense that I see few signs of the awareness of any need for this in our new President, but then Lincoln was not an early supporter of the idea either. It grew in him as he became more conscious of the real nature of the monetary problem due to input from others. Surely President Obama has the ability to grow in this way also.

I would add that, in my view, Obama needs not only to finish the monetary revolution that Lincoln started, but to take it to a higher level. That is, he must resolve the fundamental monetary question that has plagued this nation in a way that does not lead to an outward conflict that rends it. I would suggest that this is where We the People can help him, by picking up on the essential conversation that this nation needs to have about money.

Ultimately, the enemy "in the rear" is not the banks and bankers, but a pernicious idea that has been internalized at all levels of our society and culture (the idea that "money is debt"). What is needed is to open up a good-faith, truth-seeking dialogue about money between all segments of society; people of finance included. Only then will we resolve the monetary problem that festers unresolved below consciousness at the heart of our social order. That dialogue is what this New View On Money series of columns seeks to precipitate.

Richard Kotlarz

1904 1st Ave. S, #12
Minneapolis, MN 55403


The complete set of columns from this series is posted at the following websites.