Sunday, February 12, 2012

Federal Reserve, national debt nearly defeated during Great Depression; let’s finish this now

by Carl Herman

Monetary reform is a fundamental shift in how America creates money. The shift is from a Robber Baron-era design of banks creating credit to lend to us at interest and ever-increasing debt, to our community (government) creating it for the direct payment of public goods and services. The benefits of monetary reform are full employment as government becomes the employer of last resort for infrastructure investment, the best infrastructure we can envision, and ending national debt forever.

The Great Depression in the US (1929-1941) motivated professional economists to comprehensively and creatively address its causes. Upon consideration of previous US economic depressions in 1837, 1873, and 1893, prominent economists led by Henry Simons at the University of Chicago proposed monetary reform as the nation’s most effective and practical policy response, known as the Chicago Plan (and here).

The proposal was endorsed by Simons’ colleague, Paul Douglas, Frank Graham and Charles Whittlesley of Princeton, Irving Fisher of Yale, Earl Hamilton of Duke, Willford King of NYU, and sent to a thousand academic economists for their input. Three hundred twenty responded to the mailed proposal and survey (an impressively high number for a cold-call proposal and survey) from 157 universities, with 73% in full agreement with the proposal, 12.5% in approval with various considerations in its implementation, and only 14% in disagreement.

Despite the professional expert opinion in support of monetary reform, President Roosevelt and Congress supported a minor public works program that was paid by government debt. The US depression continued only until the government embraced full employment for WW 2, but paid with further debt.

The depression could have ended anytime and with enormous domestic benefit if the full employment had been for infrastructure. The 1% then, just as now, preferred control and war. Their propaganda and force kept their Federal Reserve debt system in place.
Here’s how I frame Occupy’s economic argument, and how we’ll win today to end our debt-damned economic system rigged for those creating the debt, and move into the brighter future available for 100% of earth’s inhabitants.

If it helps, my own experience of working with government leadership of both parties for 18 years and two UN summits confirms the history below of a 1% working only and always for their own dominance. I’ve been inspired to go back and document such history over the last 160 years (and such history is already familiar to you).

Read the larger picture of how the 99% of the 1930s almost won here: Daily Censored

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