Guest Post: END THE FED? IT’S BEEN DONE!

This summer has me running in all directions, so I haven’t been able to post much. My apologies for that, however, as luck would have it, my sister Booie wanted to share some thoughts on Ron Paul’s Audit the Fed Bill recently passed by Congress….

When England tried to place the colonies under the monetary control of the Bank of England, many in America were strongly opposed. This was one of the factors leading to the Revolutionary War. Nevertheless, the First Bank of the United States was chartered in 1791, thanks to the machinations of Alexander Hamilton, in line with Northern mercantile interests. In exchange for support by the agrarian South for the bank, Hamilton agreed to ensure sufficient support to have the federal capitol moved from its temporary Northern location, New York, to a Southern location on the Potomac.

Happily, the First Bank’s charter expired in 1811 without being renewed. Sadly, “the next several years witnessed the proliferation of federally issued Treasury Notes…to finance the War of 1812” leading to runaway inflation. The Second Bank of the U.S. was chartered in 1816 in the hopes that it would end the inflation. Ron Paul has pointed out that this “aided and abetted ever more [monetary] expansion and the creation of a boom-bust cycle.”

Andrew Jackson denounced the central bank as an engine of corruption, referring to it as “The Great Whore of Babylon.” He felt that “the bank, by controlling the nation’s money supply, had great power over the economy, gave its wealthy owners a large return with very little risk, and was involved in corruption, such as bribing government officials.” This was a major political issue of the 1830s. Therefore, when he was president (1829-1837), he withdrew federal deposits from the Second Bank of the U.S. and it closed in 1836.

(An interesting side note and my favorite thing about the Jackson presidency is that he is the only president ever to eliminate the national debt. No wonder he’s on the $20 bill!)

So, history has shown that it’s possible to get rid of a central bank. And the passage of Ron Paul’s “Audit the Fed” bill (HR 459) in the House this week is very encouraging. Next stop, the Senate!

2 thoughts on “Guest Post: END THE FED? IT’S BEEN DONE!

  1. This is a great post! I love reading about how history has faced some of the same issues we deal with today. I think often we view those “olden times” as another era not closely resembling today’s society. However, it’s clear that central banking has been around for a long time and it hasn’t really changed it’s modus operandi much. It’s encouraging to know that it can be undone; however, the size and far reach of our current enconomy, I believe, makes this a more difficult (though not insurmountable!) task.

    The passing of HR 459 by such dramatic numbers should inspire hope that we may one day whitness an audit of the Federal Reserve. I can’t help but feel defeated, though, when hours after the bill’s passing in the House, Harry Reid “vows” that the senate will never vote on the bill. I know 99% of politicians are venal, unprincipaled, dishonest slime (too much?); however, this sort of naked corruption makes my skin crawl. By what right does one man, in a representative republic no less, deny the right of the other “representatives” to vote on an issue? The leaders of the senate and the house should not have what equates to dictatorial powers. It’s bizarre that this was somehow included when our government was established. If one arm of congress passes a bill, shouldn’t the other half at least vote on the thing!

    Actions like this walk one step closer down the path toward an anarchist philosophy. I’m close already, but for some reason I still harbor a tiny flame of hope that there can be a small, unintrusive, national government. I’ve studied enough to know better, but there it is anyway. Actions like this are quickly extinguishing my hope.

    • the sick thing about Harry Reid’s “vow” is that he used the issue to his advantage when he thought there was no chance of it becoming a reality. Check out this “Reality Check” from the always great Ben Swann:

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