As Americans, we have become very content and assuming of ever-improving prosperity. This is not the first time in America’s history that its citizens have been lulled to sleep, ignoring fiscal dangers caused by our Federal government, and the Federal Reserve. “Experts” comfort investors that there is nothing to fear while our legislators double, and triple down on the spending of ever-increasing fiat currency.
When confronted by logical concerns for fiscal danger we are told, “that can’t happen in America.” How many of us pretend that this is a logical response?
Hoping to escape fearful challenges to our comfort and prosperity, many choose to ignore the obvious.
At the risk of boring my readers, and because of just how dangerous I believe inflation is, I am compelled to return to this issue over and over.
In a statement quoted from “Thank God For Bitcoin,” the authors state, “Since breaking its peg to gold in 1971, the US dollar has lost over 96% of its relative value. This is due to one of the disastrous effects of the prevailing financial system: inflation.”
I can’t help but wonder how my fellow Americans react to this statement. I picture them thinking that it would be impossible for the worth of our currency to evaporate so quickly, causing them to reject the notion that this statement could be true.
I completely understand this skepticism, while at the same time asserting that it is entirely true. What is easy to overlook is that this devaluation did not occur at once, but it did indeed occur.
Each time unbacked, (or fiat,) currency is created, that currency, as well as every single dollar in circulation, will have been devalued to a very specific, mathematical degree. There are no circumstances that can correct for this devaluation. Raising interest rates only compound the problems for the tax payer by stifling commerce.
Only destroying fiat currency can increase the value of our money. Arresting its production can halt further devaluation, but continued creation can do nothing but further devalue our money.
The reason that we are less able to see the full extent of the devaluation of our money is that it has been incremental, and spread over decades. When a billion dollars of fiat money is created, it devaluates based on the current value of a dollar. It does not devalue based on the value of the dollar in 1913.
The quoted statement compares the purchasing power of the 2022 dollar to that of the 1913 dollar. However, while this means that the destructive power of this “new money” is not equal to 96% less value, it does allow our government to spend a large portion of the resources that we have created against our will, and to further goals that we may, or may not agree with.
Even many of the most conservative members of Congress seem ignorant of these destructive truths. They either are parties to the destruction or are going along, without an understanding of the dangers they face, ignorant of the forces they are enabling, opposed to the very principles of our founding.
While this devaluation of our money is far less than 96%, it is substantial, and if we were to pay attention to the spending level by our Congress, we should note that nearly every dollar of this spending is a direct result of inflationary theft.
Our Congress is spending money, trillions at a drop, and few members of Congress seem concerned about it. This is a big problem. What can the average American do to resist this institutionalized transfer of their wealth to what in most cases is destructive to the culture established by our founders, and founding documents?
The stated objectives of the Convention of States Action are to, “limit the power and jurisdiction of the federal government, impose fiscal restraints, and place term limits on federal officials.”
In the interest of both limiting the power and jurisdiction of the federal government, and imposing fiscal restraints, ending inflation should be an important objective.
Without fiat currency, many of our fiscal, and industrial restraints would be necessarily scaled back, and out-of-control spending would be nearly impossible.
We should ask if the Federal Reserve Act, of 1913 is constitutional. I think that this is an important question. Most Americans blithely accept its constitutionality simply because it was passed by Congress, and signed into law by President Wilson. But, was the act itself constitutional?
Our constitution was never meant to be out of reach of the average citizen. It was meant to document the existence, and preeminence of God-given rights, and our government’s duty, and methods to protect them. It was meant to be known, and understood by every American, and, “we the people,” were authorized within that constitution to hold elected, and appointed political agents accountable to that purpose.
Inflation may be the single most important danger to our nation, and ignorance of that danger might be the second most important danger.
Returning to whether the Federal Reserve Act is a constitutional law, we should remember that constitutionally, “No state shall ….make anything but gold and silver coin a tender in payment of debt.” Article 1, section 10.
“The Congress shall have power to … coin money, regulate the value thereof, and of foreign coin, and fix the Standard of Weights and Measures;” Article 1, section 8.
The question is then, what can be done about it?
If we regard these two passages of sections 8, and 10 as law, in order for the Federal Reserve Act to be authorized by our constitution, the constitution would need to have been amended. That has never happened. There are only 27 amendments to the US Constitution, and none of them address American currency or the Federal Reserve.
If there is no constitutional amendment authorizing the Federal Reserve, its control of our monetary system, and the Federal Reserve Note are wholly unconstitutional. The fact that this has never been challenged is the largest fiscal problem that our nation faces. Many, if not all of our economic challenges originate with the violation of these two constitutional provisions.
The use of the Article V amendment process is paramount to correcting these problems. If our congress has no interest in correcting it, it would fall to the second process for amendments, a convention of states.
Could it be that the first step in restoring fiscal restraints is ending fiat currency? For many years there have been efforts to audit the Fed, but even if that were to happen, would that be sufficient, and is that really necessary? It is already quite evident that if the creation of fiat money were halted, a cascade of consequences would precipitate the appropriate corrections throughout our economy.
This could not happen without much resistance. Too many people are gaming the system as it currently exists, but what cannot continue, will not continue, regardless of how many, and who protest.
God bless you, Dave