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By Root 757 0

the public would have been alerted to the possibility that the bankers were plotting an agreement in restraint of trade—which, of course, is exactly what they were doing. What emerged was a cartel agreement with five objectives: stop the growing competition from the nation’s newer banks; obtain a franchise to create money out of nothing for the purpose of lending; get control of the reserves of all banks so that the more reckless ones would not be exposed to currency drains and bank runs; get the taxpayer to pick up the cartel’s inevitable losses; and convince Congress that the purpose was to protect the public. It was realized that the bankers would have to become partners with the politicians and that the structure of the cartel would have to be a central bank.”12

These are some of the same players who wanted to take down FDR during the Great Depression. During his last year in office, JFK made an attempt to strip the Federal Reserve of its power to loan money to the government at interest. Executive Order No. 11110 gave the treasury back the power to issue currency, and not have to go through the Federal Reserve. Kennedy put nearly $4.3 billion into circulation of U.S. notes backed by silver certificates, whereas the Federal Reserve’s notes aren’t backed by anything. The handwriting was on the wall: They could be soon out of business. But guess what? After JFK was assassinated only five months later, there weren’t any more silver certificates issued. The Executive Order has never been repealed, but not a single president since has chosen to utilize it.13

Dare I say it—Will my life be at risk?—I’d like to see us back on some type of standard where our money truly has value. My big problem with the Federal Reserve is, why does the government allow this monopoly that’s in bed with the banking industry to make basically all of our country’s financial decisions? Those people aren’t elected. We form these other entities that are permitted to make policy, when in reality they’re unconstitutional. The public has to be involved in the process, our Constitution says. Here, whoever controls the money has the power. So the Federal Reserve is really more powerful than the government—and we don’t elect them.

Once Reagan and the free-market ideologues came to power in 1980, FDR’s and JFK’s legacies were like a distant memory. Alan Greenspan, named as Fed chairman by Reagan, backed up my previous point, writing: “The Federal Reserve is an independent agency, and that means basically that there is no other agency of government which can overrule actions that we take.”14 Does that sound like democracy or something else?

The new era of deregulation resulted in a boom time for the rich getting richer. Reagan opened wide the door for companies to gamble with taxpayers’ money—or loot it outright, as in the savings-and-loan scandal and bailout. The New Deal restrictions on mortgage lending went by the boards, which eventually led to the foreclosure crisis.15 In 1999, the Glass-Steagall Act was repealed by a “bipartisan” Congress during Clinton’s last year, and a real free-for-all began. You might not know how important this legislation was. It was passed in 1933 to keep separate the low-risk commercial banks where we put our deposits, and the brokerage banks that engage in high-risk speculative investments. This worked just fine for more than 50 years. During the Reagan years, the lobbyists for the finance, insurance, and real estate outfits started pushing to dump the law. Rubin and Greenspan got behind them. When this law got wiped off the books, the rules of the game changed totally. Mergers and commercial/investment partnerships skyrocketed. Now commercial banks like Citigroup could start taking multiple home mortgage loans and turning them into securities to trade on Wall Street. They could all gamble like crazy with billions raised from predatory lending practices, and with very little regulation.16

How insane was it to destroy one of the main protection devices created out of the pain of the Great Depression, and let Wall Street