I received some intelligent questions concerning using United States Notes and doing away with the National Debt, in addition to some questions regarding the Bank of North Dakota and other issues/points.
Here they are.
Paul Eggs [wrote]
Very nice read Tom. I am so far behind you guys, so if my question is dumb please just reply moron to this thread!!
If what you are saying is true and debt free money works ... How do you know how much to put in circulation? Is it directly proportioned to population?
Also The Bank of ND has earned profits that go directly back to the state for roads and services... etc... Does there system allow fractional reserve lending? If so what ratio? Based on the surplus of money in ND why doesnt each state have it's own central bank and give the interest back to the state? is this a form of "socialism"?
Again if these questions are remedial maybe you could post link and I will try to figure it out myself.
Sincerest Thanks [paragraphing line-breaks added]
Paul is referring there to my post entitled, "Bullion Bozos: Tally Sticks, Fiat, Bill Still, Gold, Silver, and Banksters."
Here's my reply to Paul's questions.
Thanks for the compliment about my post.
As for how to avoid inflation or deflation, the variables are many; but they are fairly able to be tracked already. The problems we've seen regarding it largely stem not from a lack of knowing which variables to monitor but rather that politicians have been known to change the things upon which the equations rest.
I remember Max Keiser covering an example in a segment back when he was on Al Jazeera. He explained correctly that the contents, quality, and quantity in the basket of goods used to determine the CPI have changed over time not just because people's choice of desired products changed but so the government could report lower inflation than had actually occurred. I don't recall the exact figures, but the size of a beef steak might be reduced by some percentage, which then would be reflected in the final CPI. Maintaining the same weight and quality of the beef would have reflected a higher rate of inflation. However, there are variables within variables, in that weather and land use and so forth could impact upon beef prices regardless. For instance, I'm a vegan. I switched from being a beefeater (everyday) to zero beef. The more people who might be that, the less beef as an industry might track inflation/deflation. Therefore, it is not necessarily wrong for the content choices within the basket of goods to change. It is though important that value-for-value remain as constant as we are able to get our measurements and interpretations to reflect that and necessarily bearing in mind overall quality of life individually and societally.
For all practical purposes, it is an art form where computer power and honest, careful, unselfish intentions are important — honesty being the most important, since America could assemble a team of people who could do a very reasonable job at setting up a monitoring system that would predict inflation and deflation much as the weather service does now for weather (and getting better in constant terms — laying aside drastic changes such as a super volcano or something).
There is no reason though that if it is constitutionally mandated and if we enforce the provisions that we couldn't have $100 buying essentially the same standard and quality of life 100 years from now. There is also no reason why those with only $100 now to spend couldn't have $200 in the future without inflation. The limitations are truly only in our hearts.
All other things being equal, doubling the money supply of an economy that doubles means zero inflation or deflation. How large do we want the economy/supply to become? Does it need to be tied to population? It doesn't appear to me that it does. If you see anything I'm missing here, let me know.
All of this though raises huge issues concerning where the lines would have to be drawn regarding the mixed-economy. If we started seeing inflation, by what mechanism would we reduce the money supply? Who would hold the people's money? How would the reduction be spread across the economy? Would the reduction in people's holdings be handled on a flat scale or a sliding (progressive) scale such as with income-tax brackets now?
Personally and as a Christian of the non-Calvinist variety, I'm not for a flat percentage taking from the poor. The poor always suffer more with flat schemes, and those schemes set the poor back for no good reason.
Many of the issues I've raised here are technicalities for continued debate and discussion; but in any case, the debate should be public. The days must end and soon when J. P. Morgan types make the decisions behind closed doors and in a contrived rush giving the excuse that the people are too stupid.
As for your question about the Bank of North Dakota (BND), I'm not sure what you're asking when you say does it allow fractional-reserve lending.
If you look at their most recent annual report, you will see that in the broadest terms, total loans were $2,845,860,000 on deposits of $3,021,234,000. That doesn't appear to be fractional-reserve banking to me. However, you'd have to look at the actual legislation and case law, if any, to determine whether or not the bank is prohibited from employing fractional-reserve banking.
Yes, BND is definitely a socialistic island, and people such as Ellen Brown have been calling for the various states to do exactly what you've asked about. I've written posts trying to draw attention to the possibility especially for California for instance. They are in very serious trouble, and California is huge. If CA could convert to the BND model, it would go a long way to converting the nation and world.
The banksters though will fight it tooth and nail and likely worse. There really are sociopaths within that system sitting on the top floors in the premium corner offices. They definitely expend the lives of others to hold onto and expand their private empires. It's sheer evil.
I have nothing against socialism over total privatization. My final view though is that people turn away from coercion across-the-board.
As for whether or not the BND model is the best, I say that it is not; however, it is better than current practices.
You should understand that I have a Christian worldview that is not widely shared. I don't always raise that when writing about eliminating the national debt, which in any case, is the right thing to do. An atheist certainly would not be wrong from a Christian perspective were that atheist to be for eliminating the national debt.
The national debt is the single most destructive aspect in the American and world economy [excluding militarism and such], but zero-reserve banking isn't far behind it and is nevertheless tied to it now. Monetarism, per the Chicago School, et al., is wrong; and turning the economy over to the Austrian School of economics would be vastly worst than Monetarism.
Going to United States Notes (improved and enhanced) is not a panacea. It is only a stepping stone. There is though no major obstacle in terms of the average intelligence level of the American people that should prevent them from readily seeing and comprehending the distinct advantages over the current Federal Reserve System or Austrianism, which is just a recipe for totalitarian monopoly finally residing in one person. The type of person who would arrive there based upon the spirit of individual, private acquisitiveness is just not going to be beneficial and bountiful for the people as a whole.
We really do need to care about the general welfare. We really do need to take the reins away from the sociopathic.
I hope this has done justice to your inquiry.
I may turn it into a blog post since your questions are likely to be shared by the more intelligent and inquisitive. So, I didn't reply with "moron."
You may also be interested in: "Gold-Bug Austrian Batted Zero: Ron Paul, Competing Currencies: Free Competition in Currency Act."
The following should appear at the end of every post:
According to the IRS, "Know the law: Avoid political campaign intervention":
Tax-exempt section 501(c)(3) organizations like churches, universities, and hospitals must follow the law regarding political campaigns. Unfortunately, some don't know the law.
Under the Internal Revenue Code, all section 501(c)(3) organizations are prohibited from participating in any political campaign on behalf of (or in opposition to) any candidate for elective public office. The prohibition applies to campaigns at the federal, state and local level.
Violation of this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes. Section 501(c)(3) private foundations are subject to additional restrictions.
Political Campaign Intervention
Political campaign intervention includes any activities that favor or oppose one or more candidates for public office. The prohibition extends beyond candidate endorsements.
Contributions to political campaign funds, public statements of support or opposition (verbal or written) made by or on behalf of an organization, and the distribution of materials prepared by others that support or oppose any candidate for public office all violate the prohibition on political campaign intervention.
Factors in determining whether a communication results in political campaign intervention include the following:
- Whether the statement identifies one or more candidates for a given public office
- Whether the statement expresses approval or disapproval of one or more candidates' positions and/or actions
- Whether the statement is delivered close in time to the election
- Whether the statement makes reference to voting or an election
- Whether the issue addressed distinguishes candidates for a given office
Many religious organizations believe, as we do, that the above constitutes a violation of the First Amendment of the US Constitution.
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
That said, we make the following absolutely clear here:
- The Real Liberal Christian Church and Christian Commons Project not only do not endorse any candidate for any secular office, we say that Christianity forbids voting in such elections.
- Furthermore, when we discuss any public-office holder's position, policy, action or inaction, we definitely are not encouraging anyone to vote for that office holder's position.
- We are not trying to influence secular elections but rather want people to come out from that entire fallen system.
- When we analyze or discuss what is termed "public policy," we do it entirely from a theological standpoint with an eye to educating professing Christians and those to whom we are openly always proselytizing to convert to authentic Christianity.
- It is impossible for us to fully evangelize and proselytize without directly discussing the pros and cons of public policy and the positions of secular-office holders, hence the unconstitutionality of the IRS code on the matter.
- We are not rich and wouldn't be looking for a fight regardless. What we cannot do is compromise our faith (which seeks to harm nobody, quite the contrary).
- We render unto Caesar what is Caesar's. We render unto God what is God's.
- When Caesar says to us that unless we shut up about the unrighteousness of Caesar's policies and practices, we will lose the ability of people who donate to us to declare their donations as deductions on their federal and state income-tax returns, we say to Caesar that we cannot shut up while exercising our religion in a very reasonable way.
- We consider the IRS code on this matter as deliberate economic duress (a form of coercion) and a direct attempt by the federal government to censor dissenting, free political and religious speech.
- It's not freedom of religion if they tax it.
And when they were come to Capernaum, they that received tribute money came to Peter, and said, Doth not your master pay tribute? He saith, Yes. And when he was come into the house, Jesus prevented him, saying, What thinkest thou, Simon? of whom do the kings of the earth take custom or tribute? of their own children, or of strangers? Peter saith unto him, Of strangers. Jesus saith unto him, Then are the children free. (Matthew 17:24-26)