the Fed Treasonous?
Thomas J. DiLorenzo
by Thomas J. DiLorenzo
by Thomas DiLorenzo: Another
Big Lincoln Lie Exposed
talking heads recently took a short time out from praising, deifying,
and anointing Texas Governor Rick Perry as the next president of
the United States to chastise him for criticizing the Fed. In particular,
he was taken to the neocon woodshed for saying that the printing
of trillions of dollars of paper currency was harmful to the economy
and, since we are in a depression, such an act was "almost
could not have been referring to the actual definition of treason
that is contained in Article 3, Section 3 of the U.S. Constitution,
which reads as follows:
against the United States, shall consist only in levying war against
them, or in adhering to their enemies, giving them
Aid and Comfort. (emphasis added).
The only Americans
who were ever guilty of treason under this definition would have
been Abraham Lincoln, his cabinet, the "Civil War" Congress,
the Union Army command, and all army volunteers from the Northern
states during the War to Prevent Southern Independence. Waging war
against the Southern states was the very definition of treason under
the U.S. Constitution.
redefined treason to essentially mean criticism of himself and his
government. This has always been the preferred definition of treason
by American statists, beginning with Daniel Webster, who attempted
to redefine it as such in his famous debate over the nature of the
union with Senator Robert Hayne of South Carolina. Lincoln simply
adopted Websterís subterfuge while subverting the Constitution with
where does the Fed fit in here? Was Governor Perry totally off base
when he said the Fedís irresponsible and reckless behavior is "almost
treasonous." The Fed is not "treasonous" according
to the actual definition of treason in the Constitution. But what
the Fed is guilty of is being the financial handmaiden of
the subversion of constitutional government in America ever since
its founding in 1913. It has helped to finance all of Americaís
unconstitutional wars and other "military adventures,"
for example, beginning with the Korean War. Congress no longer declares
war, as required by the Constitution, and then disguises the costs
of war with debt and with money creation by the Fed. Without the
Fed, there would have been fewer unconstitutional wars over the
past 60 years, and the wars that did occur would have been shorter.
World War I
was a nightmare for civil liberties in America, with governmental
goons literally imprisoning people for such "crimes" as
reading the Bill of Rights in public. The Fed financed about one
fourth of that war, and is therefore partly responsible for such
atrocities. The same is true for World War II and all the other
wars, including the most recent ones, where state power was used
to trample on the civil liberties of American citizens (as always,
in the name of "preserving" those same liberties for us).
War I also introduced socialistic central planning to America with
the government policy of "war socialism," which included
the nationalization of numerous industries and the dictating of
prices and production quotas in many others. All price controls
are a violation of the contract clause of the U.S. Constitution,
which prohibits laws that abridge legal contracts, such as those
between buyers and sellers or employers and employees. The contract
clause, and much of the rest of the Constitution, was simply ignored
during the World War I years and in the succeeding decades, especially
during the Roosevelt administration. The Fed was instrumental in
making this possible by financing such interventions.
In his book,
legal scholar Richard Epstein made the argument that both the New
Deal and "Great Society" programs were all unconstitutional
under the actual constitution despite the fact that generations
of lawyers have created case law that essentially rewrites the document
as being a toothless inhibitor of governmental powers. All of these
government programs have been partly financed by the Fed.
Constitution listed a very few enumerated powers of the federal
government in Article 1, Section 8. All other powers were reserved
for the people and the states under the Tenth Amendment, which Thomas
Jefferson considered to be the cornerstone of the entire document.
The creation of the Fed in 1913, along with the federal income tax
in that same year, was one of the final nails in the coffin of the
Jeffersonian constitution. Armed with the ability to engage in legalized
counterfeiting, virtually all political power became centralized
in Washington, D.C. All states became effective franchises of the
central government who could easily be bribed or bullied into submission
with federal grants or the threat of their withdrawal.
Thanks to the
Fed, American presidents can behave like world dictators, ordering
the dropping of bombs anywhere and everywhere on a whim without
any consent by Congress or anyone else. Thanks to the Fed, the majority
of Americans are on some kind of governmental dole and are therefore
neutered as opponents of the never-ending growth of government.
They do not really have free speech rights, in other words. The
same is true of all corporations that receive government subsidies.
Or even if they do not, government has become so powerful that it
can use its oppressive regulatory powers to ruin any business person
who dares to speak up against the government too effectively. Thus,
the Fed may not be responsible for "levying war" against
the states, the definition of treason that is in the Constitution,
but it has played a crucial role in the destruction of the system
of federalism or statesí rights that was established by the American
founders. Perhaps Governor Perry can do a better job of articulating
this point the next time he attempts to steal Congressman Ron Paulís
thunder on the campaign trail.
J. DiLorenzo [send him mail]
is professor of economics at Loyola College in Maryland and the
author of The
Real Lincoln; Lincoln
Unmasked: What Youíre Not Supposed To Know about Dishonest Abe
Capitalism Saved America. His latest book is Hamiltonís
Curse: How Jeffersonís Archenemy Betrayed the American Revolution
Ė And What It Means for America Today.
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