IRLF 
 
 37 377 
 
High Cost 
 
 Living 
 
 Cause 
 Remedy 
 
The biggest question before the world today is money- 
 Other questions are important chiefly as they bear on this 
 overshadowing problem 
 
 High Cost of Living 
 
 CAUSE REMEDY 
 
 By 
 
 T. GUSHING DANIEL 
 
 Author of Daniel on Real Money 
 
 If a people, country, state, or nation, be bonded 
 for all the assessed value of its property, the bond- 
 holders and not the people are the owners of it 
 
 Published by 
 
 THE MONETARY EDUCATIONAL BUREAU 
 Washington, D. C. 
 
COPYRIGHT, 1912 
 BY T. GUSHING DANIEL 
 ALL RIGHTS RESERVED 
 
 in the following Countries : United States, 
 Canada, Mexico, United Kingdom or British 
 Possessions, France, Germany, Italy, 
 Belgium, Spain, Switzerland, Tunis, Hayti, 
 Luxembourg, Monaco, Norway, Japan, Den- 
 mark, Sweden, Liberia, Russia and China 
 
 NATIONAL CAPITAL PRESS, INC. 
 
 BOOK MANUFACTURERS 
 
 WASHINGTON. D. C, 
 
DEDICATED 
 
 to the 
 
 Markers 
 
 and 
 
 leal JJr0imter8 0f the 
 ttttlfe 
 
 285885 
 
CONTENTS 
 
 Evil Effects of a False Money-System ... 5 
 
 To Overburden the Farmer Is to Destroy 
 
 the Whole of Prosperity 
 
 Bank of England 32 
 
 Establishing the So-Called Bank of the 
 
 United States 44 
 
 1861 War Measures to Raise Money. . . 52 
 Government Forestalled in Exercising Its 
 Highest Act of Sovereignty by Banks 
 Being Given the Power to Issue a Sub- 
 stitute for Money 75 
 
 National Banks 87 
 
 Analysis of the Proposed Morgan-Roth- 
 . , . schildjSrAMrich Money Trust Bill 
 Mishamfed the "National Reserve Asso- 
 
 : cm(iiQiii.(i)fthe United States" 93 
 
 Morgan - Rothschilds - Aldrich Money 
 Trust Bill Now Pending in Congress, 
 and Endorsed by "the National Mon- 
 etary Commission" the Misuse of the 
 Word "Parity" Their Last Hope of 
 
 Fooling the People 105 
 
 Anglo-American Money Trust 122 
 
 Loaning of Bank Credits and Use of Clear- 
 ing House Certificates as a Substitute 
 
 for Money 129 
 
 The American Bankers Association. ... 135 
 
 Panic of 1907 146 
 
 Responsibility Rests With the People .... 1 48 
 The Remedy 152 
 
EVIL EFFECTS OF A FALSE MONEY- 
 
 SYSTEM. 
 
 HE mental attitude of our whole 
 people has been so affected with 
 skepticism that our business men 
 can no longer deal with them in 
 candor and fairness. Yet the com- 
 petition in all lines of business has 
 become so intense that it forces them to resort to 
 all kinds of deception in order to get a mere liv- 
 ing and meet their monied obligations. 
 CJThis demoralization reaches the professional 
 class, forcing them to all kinds of questionable 
 practices to meet the high cost of living. Many 
 of them are living dishonorably, unable to gain 
 their self-approval, without which life is a fail- 
 ure. 
 
 t| We see high finance in a John D. Rockefeller, 
 head of a trust declared by the United States 
 Supreme Court to be a criminal conspiracy. 
 Yet, when forced to take the witness stand, he is 
 under the protecting care of three of the 
 reputedly great legal luminaries of this country, 
 who had prostituted their intellects for money, 
 to keep him from telling the truth to the people. 
 <fWe then see the guardians of high finance 
 represented in Joseph H. Choate, a former am- 
 bassador to England, Jno. C. Spooner, an ex- 
 Senator of the United States, who had ostensibly 
 represented the people most of his life in the 
 Senate, and Francis Lynde Stetson, the legal ad- 
 viser of J. P. Morgan in trust building and bond 
 deals against the United States Treasury. This 
 mighty trio, for a valuable consideration, appear 
 
6' Evil Eff ects of a False Money-System 
 
 against the interests of the American people to 
 see that a partner of J. P. Morgan & Co. does not 
 tell the whole truth before a Committee of Con- 
 gress appointed to investigate the "Money 
 Trust," affecting the circulating medium, that 
 tneasures the value of the property of every man, 
 woman and child in this country. 
 CJ Yet these men are regarded as an ornament to 
 the legal profession. 
 
 ^f We then pass to the highest tribunal, the cita- 
 del of last resort, where the people might hope 
 for justice, and we see the Supreme Court of the 
 United States, by a usurpation of power, undo- 
 ing the will of the people as embodied in an act of 
 Congress in the interest of the trust combinations 
 and against that of the people. 
 CfThis has become a great moral as well as eco- 
 nomic question, and the evil effects are shown in 
 the conditions of our whole people. 
 IJWe see today millions crowded into our big 
 cities where it is a physical impossibility for them 
 honestly to earn enough to get three meals a day 
 and a place to sleep. A great many in moderate 
 circumstances realize that on account of the high 
 cost of living it is impossible for them by hard 
 work to earn enough to marry and establish a 
 home. Therefore, millions of them live in un- 
 holy relations resulting in moral degradation. 
 tJVernon M. Cady, lecturer of the American 
 Federation of Sex Hygiene, made the following 
 statement in his lecture delivered in Washing- 
 ton: 
 
 CT'Mr. Cady declared that there are 300,000 
 registered white slaves in this country and that 
 the police of the various cities estimate that there 
 are one million more not registered. He declared 
 
Evil Effects of a False Money-System 7 
 
 that every moment's delay in not stamping out 
 the white slave traffic is not only costly to society 
 today but to the human race of the future. 
 CJ Home is the foundation of our moral and relig- 
 ious life. Home is the atmosphere of character 
 building, and all conditions should conduce to 
 this all-important end. 
 
 <JTo multiply happy homes is, therefore, the 
 greatest achievement of human government and 
 is essential to the upbuilding of the character of 
 a people without which all forms of government 
 will inevitably result in failure. 
 J By this test the records and the facts already 
 demonstrate our failure. A dishonest and eco- 
 nomically false money system has created arti- 
 ficial conditions, bringing about a high cost of 
 living that makes it a physical impossibility for 
 the honest young men and women of today to 
 marry and establish homes, although living in a 
 land of almost boundless resources. 
 CJThe statesman, so-called, and legislator will 
 look upon this picture and admit its truth and 
 straightway shift the responsibility by saying it's 
 a moral question and should be solved and reme- 
 died by the Church. 
 
 <JThe Clergy will be much affected and preach 
 Sunday sermons on the subject, thereby reliev- 
 ing themselves of any further responsibility, or 
 by saying it is a political question and we should 
 not meddle in politics. 
 
 IJWhat chance does the religion of Christ have 
 as a moral force upon the people surrounded by 
 such conditions? 
 
 <| I ask those who have assumed the sacred obli- 
 gation of being the representatives of God and 
 responsible for the preservation of the Christian 
 
8 Evil Effects of a False Money-System 
 
 Religion, as taught by Christ, and the salvation 
 of human souls, "What answer have you to 
 make for these conditions?" 
 CJThis has become a vital moral as well as eco- 
 nomic question that no man on this earth can 
 neglect and perform his simple duty as a citizen. 
 <|How far greater is the responsibility upon 
 those who have openly dedicated their lives to 
 the Christian Religion and the good of mankind! 
 CJThe cause and remedy are plainly outlined in 
 this production and a call is made upon every 
 honest man who loves his family, his neighbor, 
 his country, and his God, to put the remedy in 
 force. The people must save themselves. Their 
 representatives in Congress have been "weighed 
 in the balance and found wanting." 
 <JThe vital question to be determined is: Shall 
 the Government be controlled by the people or 
 by the power of money? It is therefore a matter 
 of deepest and most widespread importance to 
 the whole people of the United States and to 
 their latest posterity. 
 
 ^ Under the present system we have become a 
 nation of debtors, and the borrower is but the 
 servant of the lender. 
 
 <J Millions of men every day in the year appear 
 in the presence of the money-lender, not as a free- 
 man asking for the use of money for which he is 
 prepared to give good security and pay the law- 
 ful rate of interest, but like a supplicant asking 
 for favors and the very manner of condescension 
 and superiority with which the money-lender 
 grants the loan carries with it an implied obliga- 
 tion, the borrower must be good, attend strictly 
 to business, and be in sympathy with the objects 
 of the banks or he will lose its accommodation in 
 future. 
 
Evil Effects of a False Money-System 9 
 
 } Every man in this country should be in posi- 
 tion to demand the use of money, the medium of 
 exchange for all properties, as a right, not as a 
 favor, and he who has land be able to borrow 
 money at the same rate of interest as he who has 
 bonds, in fact, if there is any discrimination it 
 should be in favor of the real producers and not 
 in favor of the non-producers or bond-holding 
 class. 
 
 tj In contrast to this we see millions of the real 
 workers and producers cowering in the presence 
 of the money changers, a class which the people 
 themselves have created through Congress sur- 
 rendering to National Banking Corporations the 
 power to issue a credit currency whereby they 
 control the money-system of the United States. 
 <JI would impress upon every voter that real 
 money can be created only by an act of sov- 
 ereignty, and that each voter is an individual part 
 of that sovereignty as a creator of money and 
 obligates himself through this act of Congress 
 to redeem this money in his services and prop- 
 erty. 
 
 SMy earnest purpose is to make every man in 
 e United States realize his importance as a sov- 
 ereign voter, and his dignity as an American 
 citizen, and that the man is not the servant of the 
 dollar in this Republic; but its creator and that 
 his property is more important than money, the 
 medium of exchange. 
 
 <J It should be borne in mind that the value of the 
 American dollar does not depend upon bankers 
 or gold, but upon the National wealth of the 
 United States created by the people. (An ex- 
 haustive treatment of this subject can be found in 
 Daniel on Real Money Last Edition. ) 
 J As a result of the present money-system dis- 
 
1 Evil Effects of a False Money-System 
 
 criminating in favor of money-lenders non- 
 producers gamblers and parasites, the popula- 
 tion has drifted away from agricultural pursuits 
 and the cities are overcrowded with non-pro- 
 ducers. 
 
 f| One of the direct effects of the remedy herein 
 given would be, immediate relief and encourage- 
 ment to the agricultural interests, increase the 
 demand and value of farm lands, multiply indi- 
 vidual homes of real producers increase the 
 food supply and reduce the high cost of living. 
 Business communities would be built up in the 
 different agricultural sections, close to the 
 sources of supply. These prosperous communi- 
 ties would soon be linked together by rapid- 
 transit facilities, where many of the amusements 
 of the city could be reproduced without the evils 
 and temptations of city life; thus making life in 
 the country far more attractive, and rapidly in- 
 crease its population, thus relieving the con- 
 gestion of non-producers in the cities. 
 <JMen would then prosper according to their 
 merit and not according to their ability and cun- 
 ning to overreach each other. These natural 
 conditions would build up individual character 
 and that honest American manhood which 
 should be the glory of our civilization. 
 i|It would relieve all classes of business men 
 from that anxiety and strain put upon them by 
 the uncertainty of being able to get money when 
 they most need it in their business, or to protect 
 the valuable equities in the property they have 
 acquired. 
 
 <| Every man should read this book and call the 
 attention of others to it. "Eternal vigilance is 
 the price of liberty." 
 
TO OVERBURDEN THE FARMER IS TO 
 DESTROY THE WHOLE OF PROS- 
 PERITY. 
 
 ET us get away from theories of gov- 
 ernments and realize once for all 
 that the earth supports us and 
 whatever embarrasses and retards 
 its productiveness, which is the be- 
 ginning and the very foundation of 
 all wealth, is hurtful to the human family and, if 
 continued, destructive of any form of govern- 
 ment. 
 
 ^f This is the fundamental great economic ques- 
 tion now before the world; the tariff and such 
 issues are all trivial in comparison. It makes no 
 difference where a man lives; if in a great city, 
 far away from the farm, he yet bears a definite 
 relation to a certain piece of land that feeds him 
 and supports him, and the test of his usefulness, 
 from an economic standpoint, is what does he 
 put back into the store-house of the world as a 
 producer, for what he takes out of it as a con- 
 sumer. This being a self-evident fact, that no 
 sane man will deny, why go into all the wild 
 'speculative theories of government upon which 
 so-called Statesmen and Politicians ride into 
 office and live upon the taxes of the people? 
 ^fThe Roman Senate made laws for two hun- 
 dred years, and the Roman Republic went down 
 in ruin from congestion of its people in large 
 cities. Thomas Jefferson, a great student of his- 
 
1 2 To Overburden the Farmer 
 
 tory and of human government, fully realized 
 this universal economic truth and said, "Great 
 cities are the ulcers upon the body politic." 
 IJThis brings us face to face with the greatest 
 issue of history and the cause of the failure of 
 human governments; failure to keep man prop- 
 erly related to the soil. Neglect of, and discrimi- 
 nation against, the agricultural and productive 
 interests through the operation of a money sys- 
 tem altogether favorable to the development of 
 cities and non-producers, and in favor of the 
 manipulators and lenders of money, human para- 
 sites, living on what others have produced, is the 
 great economic and fundamental cause of the 
 failure of Governments. We are now face to 
 face with this problem in the United States and 
 the people must solve it; it cannot be left to poli- 
 ticians. 
 
 <JWhen in Europe, investigating and studying 
 the condition of the people in agricultural and 
 industrial occupations and realizing the condi- 
 tions of poverty surrounding them, I inquired if 
 they were giving any attention to the money sys- 
 tem under which they were living. I found they 
 treated it as a question with which they had, and 
 could have, nothing to do. I felt the hopeless- 
 ness of their condition and in contrast to this the 
 possibilities of the freemen and voters in the 
 United States, who have it in their power to alter, 
 amend, or create a money system in the interest 
 of the whole people. Yet, when I realize the true 
 condition of the people of the United States and 
 see that above 90 per cent of them have already 
 become debtors, under the operation of the same 
 money system, Banks of Issue emitting credit 
 money and every conceivable credit device to 
 
Is to Destroy the Whole of Prosperity 1 3 
 
 multiply debts against the people, upon which 
 they are directly and indirectly paying interest, 
 I realize that they are freemen only in name. 
 The majority spend their lives in debt, working 
 to pay interest on a substitute for money, issued 
 through the operation of those credit con- 
 trivances by which the master gathers the earn- 
 ings of the man, which means more frescoes in 
 the mansions of the rich, more poverty in the 
 rented homes of the real workers and producers 
 of the world. We can now fully appreciate the 
 tremendous significance of William Pitt's 
 prophecy. 
 
 fl He made the following statement when Alex- 
 ander Hamilton established in the United States 
 the first Bank of Issue, a counterpart of the Eng- 
 lish Banking system. 
 
 CJ "Let the American people go into their debt- 
 funding schemes and banking systems, and from 
 that hour their boasted independence will be a 
 mere phantom." 
 
 If There never has been a time in the history of 
 the United States when the farmer was treated 
 fairly or equitably in the nature or management 
 of the money system of the country. Although 
 he has applied his labor to the earth, the basis of 
 all wealth and general prosperity, in times of 
 bad seasons when he needed money to tide him 
 over to the next, or when he must buy seeds and 
 farming implements, he has never received the 
 use of money upon favorable terms as to time 
 and interest charges, often having to execute a 
 mortgage upon his farm, at heavy expense, for 
 an insignificant amount of money in comparison 
 to the real value of his property. 
 
1 4 To Overburden the Farmer 
 
 C| Many men have bought farms upon the same 
 terms that a man buys city property, one-third 
 cash, balance in equal installments of 1 , 2 and 3 
 years, feeling that, after they had improved the 
 farm, they could at least carry half the purchase 
 price in a mortgage upon the property. Loans 
 are carried on city property as a rule at 60 per 
 cent of their selling value. On hundreds of mil- 
 lions of stocks originally issued upon nothing up 
 to 95 per cent, the value of the property having 
 already been covered by a first mortgage of all 
 that it is worth. 
 
 CJ Yet many an industrious farmer, after spend- 
 ing years of hard labor in improving his farm, has 
 lost it and his home forever by being unable to 
 borrow one-third of its value to take up a mort- 
 gage falling due. Any man familiar with 
 money conditions knows that, if he buys a farm 
 for one-third or one-half cash, he is apt to lose it 
 unless he can pay the entire mortgage when it 
 comes due. Thousands have tried it and been 
 sold out, and had to move to cities. 
 <|This is not all; after he has taken all the risks 
 of bad seasons, expending a large part of his 
 vitality and life in the raising and gathering of 
 crops, the necessities of his family may compel 
 him to force it instantly on the market, as he has 
 no means of raising money in any other way. 
 ^f While his crops are in the ground, the specu- 
 lator and banker in the large cities of the United 
 States are preparing their plans to buy them at 
 the lowest price, having the facilities to borrow 
 money to do so. The crops thus bought at the 
 lowest price are placed at the highest for the con- 
 sumers to buy, and the speculator makes the 
 profits. Without this facility to borrow money 
 
Is to Destroy the Whole o( Prosperity 1 5 
 
 in the city, which is denied to the farmers in the 
 country, the speculator could not take this ad- 
 vantage of both farmer and consumer. 
 <J A man can borrow from the financial institu- 
 tions of this country, on any securities of the 
 trusts in which they are interested, up to 90 per 
 cent of their fictitious market value. A man 
 would be laughed at by these financial institu- 
 tions, or told a financial lie and refused if he 
 wanted to borrow one-half the value of a farm 
 he wished to buy in order to become a real pro- 
 ducer. 
 
 <J More than this, if the farmer has the good for- 
 tune to own his farm free of mortgage, he has 
 not escaped; at the beginning of the season he is 
 brought face to face with the fertilizer trust and 
 he is asked to pay his proportion of the interest 
 and dividends on the superfluous bonds and 
 stock issued by this trust. After taking out the 
 extravagant cost of management, exorbitant 
 salaries for officials, and the pay roll of all of its 
 employees, the farmer has to pay his proportion 
 of the dividends and interest on the stock and 
 bond indebtedness of this corporation. 
 fJThe International Harvester Trust then holds 
 him up for an advanced price on all his farming 
 implements, to pay the same charges as above 
 enumerated, high salaries and wages, and divi- 
 dends on $120,000,000 of stock. George W. 
 Perkins is Chairman of the Finance Committee, 
 and the trust was organized by J. P. Morgan & 
 Company. 
 
 CJThe farmer has not yet escaped the trust 
 vampires. At the freight depot, before he can 
 get his crop to the market, the freight agent of 
 the railroad demands that he shall pay his pro- 
 
1 6 To Overburden the Farmer 
 
 portionate part of the dividends and interest 
 charges on the debts of the railroad system rep- 
 resented in Bonds and Stocks amounting to 
 $16,767,544,827. 
 
 J Thomas F. Ryan, a close business associate of 
 J. P. Morgan, the organizer of the great railroad 
 combinations, testified under oath, in New York, 
 that 90 per cent of the stock of all the steam rail- 
 roads in the United States was water. 
 CJ It was shown by Mr. Daniel, in his statement 
 before the Interstate Commerce Committee of 
 the Senate, that the people were paying $78,- 
 000,000 annually in interest and dividends to 
 the Steel Trust alone in the high prices they paid 
 for its products. 
 
 IJThe farmer deposits the net balance to his 
 credit in bank. As soon as he begins to spend 
 it, he finds its purchasing power has been dimin- 
 ished; if he travels on the railroad, he is again, in 
 the price of his ticket, paying interest and divi- 
 dends on the entire debts of the road; and a like 
 tribute to the Flour Trust, Meat Trust, Sugar 
 Trust, Coffee Trust, Oil Trust, Steel Trust, Lum- 
 ber Trust (ad infinitum). And, when you add 
 to this the general rise of prices caused by the in- 
 flation of our currency system with every known 
 substitute for money that the banker and finan- 
 cier has been able to invent, in order to earn in- 
 terest on ten imaginary dollars for every real 
 dollar loaned, it will be seen that the real value, 
 or purchasing power of the dollar has been taken 
 from it by the operation of a dishonest money 
 system, without which none of these evils could 
 have existed. 
 
 <JThus the farmer has paid his proportionate 
 part of the interest and dividends on all the 
 
Is to Destroy the Whole of Prosperity 1 7 
 
 paper tokens of wealth dishonestly issued by 
 these trust combinations, and dishonestly dis- 
 tributed by these industrial trust promoters, J. 
 P. Morgan & Co. et al. 
 
 The Farm That Feeds Us All. 
 
 fJThe following statement shows the value of 
 the farming industry of the United States: 
 
 Value of land . $28,475,674,000 
 
 Value of buildings 6,325,452,000 
 
 Value of implements and ma- 
 chinery 1,265,150,000 
 
 Value of animals, poultry, etc. 4,925, 1 73,000 
 
 $40,991,449,000 
 
 flit is estimated that about $6,000,000,000 of 
 money are loaned on the farming industry, at an 
 average interest rate of 8^ per cent. These loans, 
 as a rule, are made for comparatively short 
 periods, and, in addition to this high rate of inter- 
 est, the farmer is subjected to heavy renewal 
 charges, legal expenses, etc. In this connection, 
 it should be remembered that the earth is the 
 economic mother of us all and therefore should 
 be fundamentally the best security for money, 
 and that the farmer has the very best security 
 for current loans there is in the world, namely, 
 products that go into immediate consumption, 
 the very necessities of life, that sell in all the 
 markets of the world, every day in the year. Yet 
 he pays double the interest that a speculative 
 borrower or non-producer pays upon the 
 watered stock that he puts up as collateral for 
 
1 8 To Overburden the Farmer 
 
 loans in the financial institutions in the cities, 
 which has not one dollar of real value back of it. 
 IJThe farmers in France and Germany obtain 
 their loans at about one-half the rate of interest 
 that the American farmer pays. 
 J The great financial institution in Paris, known 
 as the Credit Foncier, was started by the govern- 
 ment support in 1 852, but has not since needed 
 government help and, from that time till the 
 present, has been steadily making loans without 
 interruption from panic, war, or any other cause. 
 tjlts loans at the present time amount to more 
 than $2,000,000,000. The loaning rate is based 
 upon about one-half the appraised valuation of 
 the farm and the interest rate has always been 
 less than 5 per cent, and this year, 1912, is 4^ 
 per cent. 
 
 <|The French farmer is therefore getting his 
 loans at about one-half of what the American 
 farmer is paying. If the farmer wishes to build 
 upon his land, he can obtain a mortgage credit, 
 based upon the value of the land and the build- 
 ings to be put up. This is a building loan; when 
 the building is completed its cost can be added 
 to the loan. 
 
 J The farmer can borrow on a time loan running 
 from one to nine years by simply paying interest 
 upon the loan, or he can borrow for a period of 
 75 years by paying upon the loans very small in- 
 stallments year by year. In January, 1912, this 
 financial institution offered for subscription 
 $100,000,000 of 3 per cent bonds in denomina- 
 tions of fifty dollars each and running to seventy 
 years. It was over subscribed nineteen times. 
 There was more than $ 1 ,900,000,000 of French 
 money offered to the Credit Foncier on that date 
 
Is to Destroy the Whole of Prosperity 19 
 
 at a three per cent rate of interest for seventy 
 years, to be lent to farmers and communities by 
 that association. 
 
 <J I would call special attention to the time these 
 loans have to run, in contrast to the short periods 
 given the American farmer and the uncertainty, 
 anxiety and constant renewal charges he is sub- 
 jected to, in taking care of his loans. In the case 
 of the French farmer, he enjoys the certainty, 
 hopefulness and inspiration that a man feels who 
 owns his home and can improve his farm for the 
 benefit of his family and his children, knowing it 
 is his, as long as he pays even the small rate of 
 4^ per cent interest on his loan. On the other 
 hand, the American farmer, if he has a loan upon 
 his property, is kept in a continuous state of un- 
 certainty, always apprehensive that his mort- 
 gage may not be extended, and feels that he is 
 periodically at the mercy of the money lenders 
 whenever his mortgage becomes due. The feel- 
 ing that he may lose his farm and all improve- 
 ments he may have put upon it, the result of his 
 life's work, depresses his spirits and robs him of 
 that hope which is absolutely necessary to suc- 
 cess or the proper enjoyment of life. Under 
 such conditions, is it at all surprising that men 
 are leaving the farm, and the cities are being 
 overcrowded? 
 
 f| By referring to the loans made to the farmers 
 in France, or in any other reference I make to the 
 foreign Money Systems, I do not mean to recom- 
 mend to the United States to imitate them. 
 France, although having the best money system 
 in the world at present, has been handicapped 
 with a National debt now amounting to $6,963,- 
 953,193. 
 
20 To Overburden the Farmer 
 
 ^Therefore, she has been unable to establish a 
 money system owned absolutely by the French 
 Government, although she does control the man- 
 agement of the Bank of France. 
 J In this connection, I would caution the Ameri- 
 can farmer not to be misled by this movement to 
 investigate the rural credit associations of Eu- 
 rope in order that they may be imported into this 
 country, or that National Banks be given the 
 power to loan on real estate. It is not to the in- 
 terest of American farmers to encourage credit 
 institutions to multiply debts on the farms of this 
 country as has already been done by the trust 
 combinations on the industrial resources of the 
 United States. But they should be able to bor- 
 row real money, not credit, and their first object 
 should be to pay off the debt from the earnings 
 of the farm as soon as possible, and be really 
 freemen, not in debt or financial bondage. 
 <J It is shown by "Daniel on Real Money" that it 
 is only necessary for the United States to estab- 
 lish a Money System in accord with its Constitu- 
 tion, to be entirely free of a National debt, and 
 the Government would absolutely own and con- 
 trol the proposed Government Bank of the 
 United States. Agricultural loans could then be 
 provided for as follows: 
 
 4.60 
 
 Call Loans, New York 
 
 American Farm Average 
 
 What it costs in interest for What it costs in interest for a 
 
 the non-producer, speculator and farmer who produces the neces- 
 
 parasite to borrow $1,000 on sities of life to borrow $1,000 for 
 
 stocks and bonds for one year. one year. 
 
Is to Destroy the Whole of Prosperity 2 1 
 Agricultural Loans. 
 
 CJThe tremendous annual increase of National 
 wealth as the result of the work of the real pro- 
 ducers, and the increase of the population of the 
 United States, calls for an annual increase of 3 
 per cent upon the total stock of money in the 
 currency system based upon the average increase 
 per annum for the last ten years. This does not 
 include other substitutes for money emitted by 
 banks and other corporations. This increase 
 should be issued in real money by the govern- 
 ment and the people have the full benefit of its 
 use, as they are responsible for its redemption, 
 and all credit substitutes for money issued or 
 emitted by corporations, now inflating the cur- 
 rency system, should be prohibited by law under 
 heavy penalties. As the total money now 
 in the currency system of the United States 
 amounts to $3,214,000,000, the annual in- 
 crease would be $96,420,000. This money 
 should be loaned by the government where it is 
 most needed, in the agricultural section of the 
 United States, at not more than 5 per cent 
 interest; through the branches of the pro- 
 posed government bank (See Daniel on Real 
 Money), also using in this connection the ma- 
 chinery and deposits of the present postal sav- 
 ings banks in the thinly settled sections of the 
 farming communities. There is no reason why 
 the percentage of farm loans should not be based 
 upon fifty per cent of the value of the farm. Fur- 
 ther small amounts should be loaned to the 
 farmer, for his seasonable needs, by his obtain- 
 ing the endorsement of his negotiable note by a 
 responsible endorser. The interest earned by the 
 
22 To Overburden the Farmer 
 
 government on all loans would reduce the taxes 
 of the people in supporting the government, and 
 
 Would soon amount to a great many million dol- 
 lars, and the tariff could be reduced proportion- 
 ately on the things the people buy. 
 
 Drift to Cities Adds to High Cost of Living. 
 
 Consumers Have Increased Faster in 
 United States Than Producers. 
 
 fl Census figures now at hand show that be- 
 tween 1 900 and 1910 the city population of the 
 United States increased from 31,61 0,000 to 42,- 
 632,000, a gain of 34.8 per cent. During the 
 same period the rural population increased only 
 1 1.2 per cent, or from 44,385,000 to 49,349,- 
 000. Thus it appears that in ten years the popu- 
 lation which consumes farm products increased ' 
 11,013,000, while that which produces such 
 products increased only 4,964,000. 
 
 Sit is also to be noted, as an economic factor, 
 at in 1 900 the urban, or consuming, popula- 
 tion, was 1 2,775,000 persons less than the rural, 
 or producing, population, while in 1 9 1 it was 
 just the other way about to the extent of 6,726,- 
 000 persons. Then, too, all people classed in the 
 rural population are not engaged in agricultural 
 pursuits. 
 
 j[ The cereal crops for 1 899 were grown on 1 84,- 
 982,000 acres. For 1 909 the acreage in cereal ( 
 crops was 1 9 1 ,396,000 acres, an increase of only 
 3.5 per cent. In the same time the yield of the 
 cereal crops increased only 1 . 7 per cent. 
 CJFor 1 909 the per capita production of cereals 
 was forty-nine bushels, or more than nine 
 bushels less than it was ten years before; but 
 
Is to Destroy the Whole of Prosperity 23 
 
 comparing the two years, the total value of the 
 cereal crops jumped from $1,482,600,000 for 
 1899 to $2,665,500,000 for 1909, a gain of 80 
 per cent. This reflects the basic cause of the 
 higher cost of food supplies. 
 
 <JLet not the consumer think that, because the 
 farmer has been so heavily taxed, the con- 
 sumer has escaped or that the farmer gets the 
 benefit of the high prices. 
 
 ^f All consumers pay the extra cost; for every 
 excessive burden laid upon the producer is ulti- 
 mately paid by the consumer. 
 t| The same pernicious money system has oper- 
 ated to the disadvantage of every legitimate busi- 
 ness in the United States and has resulted in high 
 prices to all the people, making their expenses 
 run ahead of their income, creating discontent 
 among the honest workers and real producers 
 throughout the United States, all the result of 
 the work of professional bankers, men who think 
 of money as something to lend and not as the 
 circulating fluid of the country's industrial life. 
 This fundamental economic trouble is the prime 
 cause of all of our industrial ills and they can 
 never be eradicated until the power to create and 
 regulate money is exclusively exercised by the 
 Government truly representing all the people; 
 and the money system taken out of the hands 
 of men who are incapable, or unwilling, from 
 self interest and avarice, to realize that money 
 to circulate and not money to loan is what the 
 industrial well-being of the country needs. 
 CJThe money lending institutions are now put- 
 ting the screws on the borrowers in the cities as 
 well; increasing the rate of interest on real estate 
 loans as they fall due and exacting commissions 
 
24 To Overburden the Farmer 
 
 ranging from 1 to 5 per cent, and in many cases 
 exacting all the borrower is able to pay in order 
 that his overdue mortgage may be taken care 
 of by a new loan. 
 
 CJ A large majority of all the homes and rented 
 houses in the United States are now mortgaged, 
 making the expense of home owners abnormally 
 high, but, far worse than this, the interest on the 
 mortgage is putting up the rents on all the people 
 in the United States who can least afford to pay 
 such increase. Very nearly all the great office 
 buildings and apartment houses, etc., in the cities 
 are being built on mortgages as speculative en- 
 terprises, and the interest charges are figured in 
 the rent the tenants have to pay; thus making 
 another permanent item to add to the high cost 
 of living. 
 
 <f In the United States it has become at times a 
 matter of buying the use of money, and the in- 
 siders, operating with the loan funds of the insti- 
 tutions, in order to get a large commission, give 
 preference to inferior security in granting loans. 
 Many of them are no longer satisfied with a 
 legitimate rate of interest. 
 
 tJMost of the business men, and independent 
 corporations, can no longer be sure that their 
 outstanding loans can be renewed, or, if renewed, 
 what rate of interest they will have to pay or the 
 commissions that may be exacted of them. In 
 fact, if they were called on for settlement during 
 a money stringency, fully 80 per cent of them 
 would lose their equity in everything they have 
 accumulated during their lives. 
 f| Such is the uncertain condition of the mind of 
 the business man, when he contemplates the fu- 
 ture, that he can not fail to be discouraged by the 
 
Is to Destroy the Whole of Prosperity 25 
 
 uncertain and precarious condition of his busi- 
 ness and property, being absolutely at the mercy 
 of the money market and money lender. 
 If In other words, these men are increasing the 
 prices of everything consumed or used by the 
 people of the United States in order to pay not 
 less than 5 per cent interest and dividends on the 
 debts manufactured under the operation of our 
 present money system as evidenced by stocks 
 and bonds aggregating $70,000,000,000 making 
 a charge upon the people of $3,500,000,000 an- 
 nually and this is not the sum total of the burden 
 as it does not include the interest on billions of 
 dollars loaned on real estate and other securities 
 that enter into the high cost of living. 
 
 High Cost of Living or a Cheap Dollar. 
 
 1897 100C IJThe American dollar's 1904 79c 
 
 MR- Qfir J h / inka ^ e durin f the J ast 1905 77c 
 DC fifteen years has been 
 
 IftQQ oo_ thirty cents. Authority, 1906 73c 
 United Sates Bureau of 1907_69c 
 
 1900 81c Labor. 
 
 If In other words, the 
 
 1901 83c value, purchasing power 1909 70c 
 
 1902- 79C of the American dollar, has j 910 _g 8c 
 fallen 30 per cent in the 
 
 1903 79c last fifteen years. 1911 70c 
 
 CJThis shows the cost of living has gone up 
 nearly one-third. 
 
 CJThe Englishman's dollar, according to Sauer- 
 beck, English authority, has decreased in value 
 or purchasing power to 78 cents. This, the era 
 of inflation of bank credits in the United States 
 
26 High Cost of Living 
 
 and Europe, and multiplication of debts, the 
 interest and dividends upon same being added to 
 the cost of the thing sold to the consumer, adds to 
 the high cost of living. 
 
 JWe will first take inflation of the currency. 
 The following truism from John Stuart Mill, 
 ("Political Economy") : 
 
 The value of money, other things being the 
 same, varies inversely as its quantity: every 
 increase of quantity lowering the value, and 
 every diminution raising it in a ratio exactly 
 equivalent. 
 
 f]f General Francis A. Walker, "Money, in its 
 Relations to Trade and Industry," chapter 1 : 
 
 Money is to be known by its doing a certain 
 work. Money is not gold, though gold may 
 be money; sometimes gold is money and 
 sometimes it is not. Money is no one thing, 
 no group of many things having any material 
 property in common. On the contrary, any- 
 thing may be money; and anything, in a given 
 time and place, is money, which then and 
 there performs a certain function. Always 
 and everywhere, that which does the money 
 work is the money thing. 
 
 IJ If the reader will memorize the following cor- 
 rect definition of money and bear it constantly 
 in mind he can clearly understand the whole 
 subject of money as an economic question in 
 contradistinction to the credit money of "Banks 
 of Issue" and find exposed the greatest financial 
 curse that has afflicted the people of the world. 
 ^f Money is so much value embodied in a circu- 
 
Or a Cheap Dollar 27 
 
 lating medium, which constitutes so many uni- 
 versal orders, which the people agree to accept 
 for anything they own, including debts and serv- 
 ices. As such they have authorized its issue by 
 (their sovereign power, the Congress of the 
 ftjnited States. 
 
 Cj Originally money was a due bill issued by one 
 person to another, now it is a universal order, 
 issued by all the people against themselves, and 
 is redeemable in the entire wealth of the country 
 and the services of all its people. Originally the 
 lvalue of these dollars was expressed by the 
 physical thing being stipulated in the due bill 
 itself. Since, by an act of sovereignty taking 
 on the character of universal orders, money is 
 a creation of law and thereby declared units of 
 value, "American dollars" and their value de- 
 fends upon the quantity of dollars out. A 
 proper monetary system is, therefore, to be 
 regulated by the number of dollars issued under 
 the authority of the sovereign power. 
 
 Inflation of the Currency by Banks of Issue. 
 
 CfAll substitutes for money, such as bank 
 credits, clearing house exchanges, traveller's 
 checks, issued by The Bankers Trust Company, 
 International Mercantile Marine Co., Express 
 Companies, etc., are inflating the currency, by 
 doing the work of money and have the effect of 
 |^n enormous increase of the currency, making a 
 cheap dollar and high prices; which means High 
 Cost of Living. 
 
 fJThis imposition and tax upon the people is 
 being felt three times a day in the household 
 tof every family. The protective tariff is in- 
 cidentally a cause of higher prices, as enabling 
 
28 High Cost of Living 
 
 the manufacturers to exact high tributes from the 
 people, subsequently the trusts by combination 
 he^ve arbitrarily advanced on the things they 
 produce and sell. But the present question of 
 the high cost of living has now outgrown the 
 tariff and finds its cause and support in the infla- 
 tion of our present credit money system 
 and becomes a great economic question in com- 
 parison with which tariff and trusts are subordi- 
 nate and mere side issues. 
 
 CjfThe voters of the country have witnessed 
 the remarkable spectacle of three political 
 parties meeting in conventions, nominating 
 candidates for the presidency and using their 
 combined wisdom in drafting platforms, yet 
 each nominee for the Presidency of the United 
 States practically admits his ignorance of the 
 money question and the plank of each party's 
 platform on the money question is absolutely 
 indefinite, submits no plan and literally means 
 nothing. 
 
 f More than this not one of them treats the sub- 
 ject of money as a great economic question now 
 before the voters but deal in vague suggestions 
 about reforming our present national banking 
 system which can only be properly characterized 
 as a monumental fraud which should be de- 
 stroyed, not reformed, as it is an absolutely in- 
 defensible credit system whereby Corporations 
 issue promises to pay as a substitute for money 
 based upon the fraudulent premise of gold being 
 a standard of value. This fallacy has been 
 thoroughly exposed in Daniel on Real Money. 
 
 The fair and logical inference from the evasion 
 of this vital question by those who would be- 
 come the representatives of the people is that 
 
Or a Cheap Dollar 29 
 
 they are still mental and moral cowards on this 
 subject, the money question; all apprehensive 
 of defeat if they antagonize the money interest 
 and lenders of money. Those advocating the 
 so-called Gold Standard won the campaign of 
 1 896 and an act of Congress was passed in 1 900 
 to permanently establish this so-called Gold 
 Standard in the United States. 
 CJIt is shown in Daniel on "Real Money" that 
 this was the consummation and culmination 
 of the greatest fraud ever perpetrated on the 
 people of the United States. Why is it that 
 none of those posing as the great leaders in the 
 three parties, all of whom acknowledge that the 
 times are out of joint and that the people are 
 being imposed upon and robbed in every direc- 
 tion by the high cost of living and that our cur- 
 rency system needs immediate legislation, are 
 now unwilling to state whether they any longer 
 believe in this so-called Gold Standard, which 
 is made the basis of banking corporations mis- 
 named National Banks of the United States issu- 
 ing $7 1 1 ,099,938 of their promises to pay, credit 
 money predicated on the false basis of gold. 
 ^ Every one of them know if they have given 
 the subject of money any study that would en- 
 title them to represent the people, that this 
 $7 1 1 ,099,938 of credit money should be replaced 
 by real money, legal tender money, lawful 
 money of the United States issued by the gov- 
 ernment thereby cancelling $711,099,938 
 of government bonds and relieving the people 
 of taxation to the extent of this $71 1,099,938 
 to pay these bonds and $2 1 ,000,000 interest an- 
 nually upon same. 
 
30 High Cost of Living 
 
 <J I ask the practical commercial and hard head- 
 ed voters of this country if this subject is not 
 worthy of some definite expression of opinion 
 by those who represent the three parties asking 
 for their votes. 
 
 tj It is clearly shown by Mr. Daniel in his stateli 
 ment before the United States Senate Commit- 
 tee on Interstate Commerce that our present 
 money system, the so-called Gold Standard and 
 its manipulation by inside rings of bankers and 
 promoters is the creator and supporter of every 
 trust in the United States and a fraudulent basis 
 upon which banks are issuing credit money and 
 controlling the currency system of the United 
 States. 
 
 EFFECT. ^ 
 
 <JThe effect of the inflation of bank credits as 
 a substitute for money acts in the same manner 
 as the inflation of the money system with credit 
 money, such as national bank notes, etc. It 
 has the effect of stimulating business. 
 ^lt can be readily seen that after the country 
 has been developed into a high state of pros- 
 perity by this operation of banks multiplying 
 loans against the borrowers by loaning them 
 their credits, prices of everything advance under 
 this operation of inflation and you have an era 
 of high cost of living. m 
 
 <} Summary of the present situation. The offi- 
 cial report of the Comptroller of the Currency 
 for 1911 shows the amount of money in the cur- 
 rency system to be $3,214,000,000, while the 
 investment of all banks in bonds, stocks and 
 other securities total the tremendous sum of 
 
Or a Cheap Dollar 3 1 
 
 $5,05 1 ,900,000 and in addition to this they have 
 made loans and discounts amounting to the 
 fabulous sum of $1 3,046,000,000. 
 IJThis gives the reader an idea of the enormous 
 inflation and loaning of the credits of the banks, 
 as a substitute for money, which is having the 
 effect of inflating the currency and abnormally 
 raising the general level of prices. 
 J In addition to this and in violation of the law 
 which reads, "That every person, firm, associa- 
 tion other than National Bank Associations, 
 shall pay a tax of ten per centum on the amount 
 of their notes used for circulation and paid out 
 by them," the Clearing House Association of 
 New York issued $101,000,000 of Clearing 
 House certificates in 1 907. And the Express 
 Companies, Steam Ship Lines and the American 
 Bankers Association under the name of the 
 Bankers Trust Company of New York, are issu- 
 ing millions of travellers checks as a substitute 
 for money, and thereby inflating the currency. 
 CJThe present money system of the United 
 States enabling the inflation of Bank credits 
 to be loaned as a substitute for money and the 
 emitting of credit money by Banks of Issue as 
 substitutes for money and the improper control 
 and manipulation of the currency of the country 
 and the use of it by the men promoting the trust 
 combinations have manufactured stocks and 
 bonds amounting to over seventy billion dollars 
 upon which the consumers are paying the in- 
 terest and dividends, all of which is being added 
 to the price of the things they consume or use. 
 
BANK OF ENGLAND. 
 
 HERE is nothing in the money sys- 
 tems of the old world worthy of our 
 imitation. It is only necessary to 
 state that not one of them was es- 
 tablished upon a correct basis or in 
 the interest of the people. As the 
 English money system of Banks of Issue was im- 
 posed upon this Republic, we have only to trace 
 the present money system of the United States 
 from its Parent, the Bank of England. The 
 name of "Bank of England," adopted like that 
 of the National Bank of the United States, was a 
 deception and fraud upon the people in the very 
 start. It is a private banking corporation trad- 
 ing under the prestige and fictitious credit given 
 it by the use of the name of the Government; im- 
 properly given and used by the bank with great 
 profit in carrying on the purely money making 
 scheme to exploit the people. 
 |The charter of this corporation, known as the 
 Bank of England, was granted July 27, 1694. 
 The charter provided, that they shall "be cap- 
 able in law, to purchase, enjoy, and retain to 
 them and their successors, any moneys, lands, 
 rents, tenements, and possessions whatsoever; 
 and to purchase and acquire all sorts of goods 
 and chattels whatsoever, wherein they are not 
 restrained by act of Parliament, and to grant, de- 
 mise, and dispose of same." 
 
 J "The corporation is prohibited from engaging 
 in any sort of commercial undertaking other 
 
Banks of Issue 33 
 
 than dealing in bills of exchange, and in gold and 
 silver. It is authorized to advance money upon 
 the security of goods or merchandise pledged to 
 it, and to sell by public auction such goods as 
 are not redeemed within a specified time." 
 JThe Charter gave this private banking cor- 
 poration no authority to issue bank notes as 
 money. 
 
 J But it is the same old story, the greed, avarice 
 and cupidity of man, working and operating 
 through the instrumentality of a corporation, 
 well described as an entity with "No back side to 
 be kicked and no soul to be damned." 
 |The temptation to the managers of this bank 
 was too great to resist when, in the course of 
 business, the opportunity presented itself, 
 whereby they could use their non-interest-bear- 
 ing notes to discount the borrower's note and 
 draw interest on same. 
 
 <|A reliable historian thus describes its oper- 
 ation : 
 
 J"Upon such considerations, the bank decided 
 to issue notes payable to bearer on demand, in 
 exchange for individual paper payable at a fu- 
 ture day. The bank thus undertook to do an im- 
 possibility, in the hope that it would not be called 
 upon to redeem the promise or make the attempt. 
 The bank had not the money and could not, 
 therefore, purchase the paper offered; the notes 
 offered by the bank were not money, though a 
 much better substitute for money than the notes 
 of individuals, which could only circulate to a 
 very limited extent as a medium of payment. 
 The bank issued notes payable to bearer, with- 
 out endorsement, which added to their facility 
 in passing rapidly from hand to hand as cur- 
 
34 Origin of Our Money-System 
 
 rency. It departed still further from sound 
 principles, when it made these notes payable on 
 demand in gold and silver; for it must be con- 
 trary to sound principles to undertake to do 
 what cannot be done. The bank notes were 
 nothing more than the promissory notes of the 
 bank to circulate among those who chose to take 
 them, not as money, but a promise to pay money. 
 And the promise should have been only such as 
 the bank could perform; but it could never have 
 been imagined for one moment, that by this 
 process between the bank and its customers they 
 manufactured money." 
 
 J "This process was supplemented by the bank 
 depositing the proceeds of notes discounted to 
 the credit of the party, as so much money de- 
 posited. It mingled a process of cash and credit 
 as absurd in theory as it was dangerous in prac- 
 tice." Thus the apparently small beginning of 
 issuing their notes non-interest-bearing for those 
 of their borrowers bearing interest, is the per- 
 nicious beginning of the great credit money sys- 
 tem of Bank of Issue in England, and engrafted 
 upon this Republic by the same influences under 
 the misleading title of "National Banks of the 
 United States." All of which has been paid for 
 since by the people of England and the United 
 States by panics, business depressions, causing 
 untold loss and injury to the people of both 
 countries. 
 
 J All this was inflicted upon the people upon the 
 same old theory of credit money or bank notes 
 payable on demand, without the money in hand 
 to do it. Upon the presumption, of course, that 
 the bank would not be asked to pay for many 
 of them at any one time. 
 
Banks of Issue 35 
 
 | This error of the Bank of England is the parent 
 of the evils for which banks in more modern 
 times are answerable. 
 
 CJThe Bank of England had made its demand 
 notes payable in specie, and in 1 897 the bank 
 found it impossible to make specie redemptions, 
 and the directors in alarm appealed to the Privy 
 Council, and that body determined on the 27th 
 of February, 1 797, "that it is indispensably 
 necessary for the public service, that the Direc- 
 tors of the Bank of England should suspend cash 
 payments until Parliament can act for its pro- 
 tection." Parliament sanctioned and continued 
 this suspension from 1 797 to 1 820, or a period 
 of 23 years. I would call the attention of those 
 who oppose full legal tender money being 
 issued, as the money of the United States, to the 
 fact that the people of Great Britain carried on 
 their business affairs for 23 years with non-legal 
 tender paper currency, and during this term, 
 notwithstanding the great expense of war, and 
 consequent burdens of taxation, Great Britain 
 increased in wealth and prosperity more than at 
 any other time in her history. 
 CJA reliable historian describes the conditions 
 as follows: "During this period, notwithstand- 
 ing the vast expenditures of war and the burdens 
 of taxation, Great Britain increased in wealth 
 and prosperty more rapidly than at any other 
 period in her history. 
 
 f During this time 3,000,000 of acres of unim- 
 proved land was brought under cultivation, and 
 the exportation of manufactured Cotton goods 
 increased in amount from 7,000,000 in 1801 
 to 27,000,000 in 1822. 
 
36 Origin of Our Money-System 
 
 fj All classes of society participated in the gen- 
 eral prosperity which prevailed and during the 
 entire period the nation never once suffered 
 from commercial crash or money panic." 
 <J Resumption of Specie Payments in 1 823. 
 if At this date the money lenders forced specie 
 Resumption on the people of England and the 
 reader should retentively remember the contrast 
 The same historian states: "Specie payments 
 were accordingly resumed in 1823, and the re- 
 sumption was accompanied by the most disas- 
 trous commercial crash and money panic that 
 ever visited any nation. The era of general 
 prosperity departed to return no more. Real 
 Estate depreciated largely in value and the real 
 estate owners of the kingdom decreased in num- 
 ber from over 1 50,000 to less than 40,000; busi- 
 ness men, merchants, manufacturers, etc., were 
 ruined by the thousand; wages were reduced 
 and laborers thrown out of employment by the 
 tens of thousands; and the public revenue fell 
 off to such an extent that payments on the pub- 
 lic debts ceased and have never practically been 
 resumed. Alison, in his history of Europe, says: 
 "The effects of this extraordinary piece of legis- 
 lation were soon apparent. The industry of the 
 nation was speedily congealed, as a flowing 
 stream is by the severity of an Arctic winter. 
 The alarm became as universal and widespread 
 as confidence and activity had recently been. 
 The country bankers, who had advanced largely 
 on the stocks of goods imported, refused to con- 
 tinue their support to their customers, and they 
 were forced to bring their stocks into the market. 
 Prices in consequence fell rapidly; that of cotton, 
 in particular, sank in three months to half its 
 
Banks of Issue 37 
 
 former level. The country bankers' association 
 was contracted by no less than five millions 
 sterling ($24,000,000); and the entire circula- 
 tion of England fell from $235,545,000 in 1 81 8 
 to $1 74,385,000 in 1 820, and in the succeeding 
 year it sank as low as $142,757,000. * * * 
 The effects of this sudden and prodigious con- 
 traction of the currency were soon apparent, and 
 they rendered the next three years a period of 
 ceaseless distress and suffering in the British 
 Islands. The accommodation granted by bank- 
 ers diminished so much in consequence of the 
 obligation laid upon them to pay in specie, which 
 was not to be got, that the paper under discount 
 at the Bank of England, which in 1810 had been 
 $1 15,000,000 and in 1815 not less than $103,- 
 000,000, sank in 1820 to $23,360,000, and in 
 1821 to $13,610,000. The effect upon prices 
 was not less immediate or appalling. They de- 
 clined in general, within six months, to half their 
 former amount, and remained at that low level 
 for the next three years. Distress was universal 
 in the latter months of 1819, and that distrust 
 and discouragement were felt in all branches of 
 industry which are at once the forerunner and 
 cause of disaster." From Mr. Doubleday's his- 
 tory we also quote as follows: "We have already 
 seen the fall in prices produced by the immense 
 narrowing of the paper circulation. The dis- 
 tress, ruin and bankruptcy which now took place 
 were universal, affecting the great interests both 
 of land and trade; but especially among land 
 owners, whose estates were burthened by mort- 
 gages, settlements, legacies, etc., the effects were 
 most marked and out of the ordinary course. In 
 hundreds of cases, from the tremendous reduc- 
 
38 Origin of Our Money-System 
 
 tion which now took place, the estates barely 
 sold for as much as would pay off the mort- 
 gages; and hence the owners were stripped of 
 all and made beggars." Before the close of the 
 year 1819 the distress became insufferable. 
 Great meetings were held throughout England 
 and Scotland during the summer. In August 
 60,000 people, men, women and children, as- 
 sembled near Manchester. A collision occurred 
 between the people and the troops, in which a 
 number were killed and many wounded. This 
 created intense excitement, and the meetings of 
 the people held in Liverpool, York, Leeds, and 
 various other cities, were attended by vast multi- 
 tudes of suffering people, demanding vengeance. 
 Serious riots occurred, which were only quelled 
 by military force. In 1 820 a conspiracy was dis- 
 covered, which had for its object the murder of 
 all the King's Ministers, and which was only 
 frustrated through the cowardice of one of the 
 conspirators, who betrayed his associates. Mili- 
 tary training went on amongst the people, and 
 the government was obliged to provide a large 
 military force to prevent an outbreak. "On Sun- 
 day morning, the 2nd of April," says Alison, "a 
 treasonable proclamation was found placarded 
 all over the streets of Glasgow, Paisley, Stirling, 
 and the neighboring towns and villages, in the 
 name of a provisional government, calling on the 
 people to desist from labor; on all manufacturers 
 to close their workshops; and on all the friends 
 of their country to come forward and effect a 
 revolution by force, with a view to the establish- 
 ment of an entire equality of civil rights. 
 Strange to say, this proclamation, unsigned and 
 proceeding from an unknown authority, was 
 widely obeyed. Work immediately ceased; the 
 
Banks of Issue 39 
 
 manufactories were closed, from the desertion of 
 workmen; the streets were filled with anxious 
 crowds eagerly expecting news from the south; 
 the sounds of industry were no longer heard, and 
 two hundred thousand persons in the busiest 
 districts of the country were thrown into a state 
 of compulsory idleness by the mandates of an 
 unseen and unknown power." Five thousand 
 troops were immediately assembled at Glasgow, 
 and the insurgents were overawed. Before the 
 end of the year the government had increased 
 its volunteer force to 35,000 men. " Without 
 doubt," says Alison, "this powerful volunteer 
 force, organized especially in the manufacturing 
 districts at this period, and the decisive demon- 
 stration it afforded of moral and physical 
 strength on the part of the government, was the 
 chief cause through which Great Britain escaped 
 an alarming convulsion." 
 
 <|But the ruin, suffering and misery which had 
 attended the attempt to force specie payments 
 could not be undone, nor could the broken for- 
 tunes be restored. By a return to specie pay- 
 ments finally, the specie basis banking and credit 
 system, the whole tendency of which is to con- 
 centrate wealth in the hands of the few, was re- 
 established; and the industrial classes, especially 
 the agricultural class, have never since been able 
 to recover from the blow then received. 
 if In 1822 the land owners of England numbered 
 1 65,000. According to the census of 1 86 1 , the 
 number was about 30,000, and one-half of the 
 whole kingdom is now owned by not more than 
 twelve persons. 
 
 tjfln 1837 another crash and money panic 
 occurred in England which also involved this 
 country When the bank of England took 
 
40 Origin of Our Money-System 
 
 gold from the United States to supply the wants 
 of England, the banks of the United States were 
 obliged to suspend Business in the United 
 States was brought to a complete stand and for 
 three years the American people were left with- 
 out any gold and were consequently obliged to 
 use shinplasters." 
 
 tfln England the losses were so enormous and 
 the distress so great that it required another act 
 of parliament to alleviate the suffering. The 
 same historian continues "From September 
 7th, 1 844, when the bank was reorganized, to 
 February 4th, 1 858, it altered its rate of inter- 
 est fifty-six times, raising it from time to time 
 from two to ten per cent, in an effort to retain 
 its specie in its vault. This, in the meantime, 
 led to great financial embarrassment and a panic 
 was only averted by the bank suspending specie 
 payments (October 23, 1847) and affording 
 relief by issuing irredeemable paper. In 1857 
 having ruined the merchants and business of 
 England, it was again obliged to suspend. 
 Eleven changes in the rate of interest were made 
 between April, 1857, and January, 1858. The 
 bank again drew upon the United States for 
 gold, causing the banks to suspend, involving 
 thousands of people in ruin and bankruptcies. 
 J In 1 866 the Bank of England suffered another 
 suspension in consequence of the war on the 
 Continent of Europe; but this time the United 
 States escaped. Greenbacks were the medium 
 of exchange, and the nation was no longer at 
 the mercy of foreign banks. Gold was shipped 
 abroad to the amount of $45,000,000 and sold 
 as a commodity at a high price for the use of 
 the Bank of England without occasioning the 
 
Banks of Issue 41 
 
 slightest ripple in the business affairs of the coun- 
 try." 
 
 J In 1 844 the poverty and distress so often 
 brought upon the people by the bank of Eng- 
 land made necessary an act of the government 
 limiting the notes that the bank could issue to 
 the amount of government securities and gold 
 held for their redemption; the bank kept on 
 with its money making scheme in another way. 
 The discount of commercial paper, entered on 
 its books, took the place of the inflated note 
 issues, but these discounts called largely for 
 gold, therefore when there was the least drain 
 on the banks gold set in, discounts were shut 
 off, interest was raised and quadrupled and 
 property of all kinds was dumped on the market 
 to pay the bank in money for the discounted 
 paper. This put the bank in a position to in- 
 crease its possessions out of the losses of the 
 people. No intelligent man can fail to recognize 
 in the above a perfect picture of the present 
 National banking system of the United States. 
 To complete the picture, I will quote from Mr. 
 Seley, of London. 
 
 J* 4 The commerce of the country is now in the 
 power of the Bank of England, as it was before 
 in the legislature. For legislative enactment we 
 have the decision of the Bank Parlor; for a re- 
 sponsible government we have substituted an 
 irresponsible body composed of twenty-four 
 directors, and a governor and deputy governor. 
 To these we have confided the commerce of this 
 mighty empire. Instead of a mercantile system 
 supported by merchants and manufacturers and 
 agricultural interests, we have now the mone- 
 tary system endangering the welfare of mer- 
 chants, manufacturers, and agricultural inter- 
 
42 Origin of Our Money-System 
 
 ests for the benefit of the fund-holding 
 classes." 
 
 <J A Bank of Issue, in the final analysis, is a mere 
 scheme devised by the avarice and cupidity of 
 man to reap where he has not sown. The men 
 organizing the Bank of England thought out the 
 plan of issuing their non-interest-bearing notes 
 for the time notes of their borrowers bearing in- 
 terest in order to make something out of noth- 
 ing. 
 
 |The whole plan being based upon the theory 
 that but a small percentage either of their non- 
 interest-bearing notes outstanding or the credits 
 allowed the borrower on their books would re- 
 quire the banks to pay out at any one time a 
 large amount in cash or real money. 
 | Realizing that such a profitable scheme would 
 not long be tolerated by the people if it was 
 made plain to them, that a corporation was mak- 
 ing large sums of money out of them by loaning 
 a substitute for money, or in other words, mak- 
 ing money out of a creation of their own for 
 which they had given no valuable considera- 
 tion; yet knowing what a great money making 
 scheme they had devised, their next thought was 
 how they could perpetuate it. 
 <}The issuing of their own non-interest-bearing 
 notes in large quantities made them feel their 
 personal risks and liabilities for what might hap- 
 pen, as they knew they were trying to accom- 
 plish an impossibility. Like all men doing that 
 which is illegal, or morally wrong, they natur- 
 ally thought of self preservation, and in order to 
 accomplish this and still keep up the scheme, 
 they offered to redeem their notes in specie, 
 thereby making the responsibility impersonal. 
 
Banks of Issue 43 
 
 Realizing they could never redeem them on a 
 specie basis, they shifted the responsibility to 
 the English Government by getting the govern- 
 ment to sanction it; knowing that if the govern- 
 ment had sanctioned their doing an impossible 
 thing the government would have to come to 
 their assistance. This being the case the bank 
 frequently suspended specie payments, subject- 
 ing the people many times to tremendous losses. 
 While the ruin was going on among the people, 
 the Bankers were able to take advantage of the 
 great fall in prices, and again increased their pos- 
 sessions of property and securities that were 
 forced upon the market. 
 
 J When the government authorized the issue of 
 non-legal tender paper money to supply the 
 wants of trade, business at once improved. 
 CJWhen prosperity was restored by the use of 
 this non-legal tender paper money, the bank 
 would use its unfailing influence to resume 
 specie payments, which meant contraction of 
 the currency, a fall in prices, business depres- 
 sion and panics, and again widespread ruin 
 among the people, and another harvest for the 
 Banks. 
 
 CJThis operation has been repeated upon the 
 people of Europe until the great sub-strata of 
 society there have been reduced to hopeless 
 poverty. 
 
 CJKind reader and voter, just keep these basic 
 facts in your mind. This is the fraudulent basis 
 of "Specie Redemption" which has developed 
 into the gold brick swindle of the so-called gold 
 standard, which will be shown to be the greatest 
 fraud ever perpetrated on mankind. Nothing 
 describes it but this: A Gigantic Confidence 
 Game, worked upon the people. 
 
ESTABLISHING THE SO-CALLED BANK 
 OF THE UNITED STATES. 
 
 T is useless to consider Continental 
 currency as at all relevant to a Na- 
 tional Money System. Judge Story 
 describes the situation after the 
 Revolution as follows: "In the first 
 place, there was an utter want of 
 coercive authority to carry into effect its own 
 constitutional measures. It may be called a 
 Government which possessed no one solid at- 
 tribute of power. In truth Congress possessed 
 only the power of recommendation: it depended 
 altogether upon the good-will of the States 
 whether a measure should be carried into effect 
 or not." 
 
 JIt was therefore impossible to create a full 
 legal tender dollar, as there was no power of 
 sovereignty to bind all the people to its ac- 
 ceptance, hence it was impossible to establish a 
 universal money system for the United States at 
 that time. 
 
 CJ In order to understand what real money is, the 
 people of the whole world should expel from 
 their minds that there is any such thing as a 
 money of the world, or international money. 
 CJ Money is a creation of an act of sovereignty 
 and is real money, legal tender money, only 
 within the jurisdiction of the country issuing it. 
 CJ Hamilton has been given great credit by su- 
 perficial students on the subject of money, for the 
 part that he performed in establishing a National 
 
A Scheme to Exploit the People 45 
 
 Banking System in the United States, but to any 
 one familiar with the subject, it is well known 
 that Hamilton originated nothing in this banking 
 plan of his, but bodily adopted the English Bank- 
 ing System and inflicted it upon our republican 
 form of Government. The whole mental 
 process of the man was undemocratic, unrepub- 
 lican and his National Banking Scheme was a 
 part of his system for a strong centralized gov- 
 ernment and the rule of the few, the rich and 
 well born. Hamilton's whole theory of govern- 
 ment was absolutely wrong. Its foundation 
 being that of money and aristocracy, two abso- 
 lutely discordant elements in a Republic. In 
 such a combination money dominates and the in- 
 evitable result is a plutocracy, the worst form of 
 government. If Hamilton had been the student 
 statesman of history that he claimed to be, he 
 should have known the poverty, suffering and 
 ruin this same credit money system had inflicted 
 upon the great mass of the English people, and 
 recognized at once that it was foreign and antag- 
 onistic to every principle of our republican form 
 of government. 
 
 fjln 1 780 the American conflict had resolved it- 
 self chiefly into a rivalry in financial ability and 
 resources between the Mother Country and the 
 Colonies. This was the time that Hamilton 
 began to set forth his financial scheme. As early 
 as this he wrote an anonymous letter proposing 
 the establishment of a bank to be called the Bank 
 of the United States. Where did he get this 
 idea? 
 
 <|Now mark the basis of its establishment as 
 outlined by Hamilton, and you have the answer. 
 It provided "The basis of this institution was to 
 
46 The Anglo-American Bank 
 
 be a foreign loan of $200,000,000 as a portion 
 of the bank stock; a subscription for $200,000,- 
 000 more guaranteed by $10,000,000^of specie 
 or by a bona fide equivalent currency." 
 C| "The bank notes were to be made payable to 
 the bearer in three months at 1 per cent." 
 CJ In addition to this, an annual loan of $ 1 0,000,- 
 000 was to be furnished to Congress by the bank 
 at 4 per cent. This plan starts out with the out- 
 rageous assumption that the United States was 
 not to exercise its right of sovereignty and create 
 its own money system, but at once become a bor- 
 rower and debtor to England and establish a 
 money system founded upon debt. 
 |In April, 1781, in a letter to Robert Morris, 
 Superintendent of Finance, Hamilton boldly 
 asserted the principle "that it is in a National 
 Bank alone we can find the ingredients to 
 constitute a wholesome, solid and beneficial 
 paper credit." To show that Hamilton was in- 
 terested in this kind of banks he wrote the Con- 
 stitution of the Bank of New York. Half a mil- 
 lion dollars was subscribed at a single meeting, 
 and Hamilton was chosen one of its directors. 
 <J Hamilton was also chairman of the committee 
 on peace arrangements between the States and 
 the Mother Country, and in this position reported 
 regarding the department of foreign affairs. The 
 report provided that the secretary of that depart- 
 ment should occupy the position of chief of the 
 Diplomatic Corps, and that it should be his duty 
 to lay before Congress such plans for conducting 
 the political and commercial intercourse of the 
 United States with foreign powers as might ap- 
 pear to him to be best adapted to promote their 
 interest. 
 
A Scheme to Exploit the People 47 
 
 CJ The subsequent acts of Hamilton show he was 
 in sympathy with the financial group of Eng- 
 land. 
 
 If In 1 787, when the Union was formed and the 
 Constitution adopted, all the States agreed to 
 surrender, and did surrender, control over the 
 issue of money in order that this sovereign power 
 might be vested in the Congress of the United 
 States representing the people of every State in 
 the Union, in order that a uniform and stable 
 money system might be established, and pro- 
 vided for same in the Constitution itself, wherein 
 Congress was given the exclusive right and 
 power to create and regulate the value of money. 
 <JThus, if Congress authorized the issue of full 
 legal tender money, every dollar becomes a uni- 
 versal order for all things on sale, all service for 
 hire, and the ultimate of payment for all debts 
 within the jurisdiction of the United States. By 
 this means every money unit or legal tender dol- 
 lar would have squarely back of it the entire re- 
 sources, national wealth and services of all the 
 people as the basis of its continuous redemption. 
 <JI will now show how the entire system was 
 perverted and set aside by the pernicious 
 influence of those who established the so-called 
 "National Banks" of issue in the United States. 
 It was simply imposing, under a different name, 
 the European money system, "a Bank of Issue." 
 A reliable historian described the political condi- 
 tions in the United States at that time as follows: 
 "At the time the Federal Constitution was 
 framed there was a large and formidable party 
 with aristocratic notions and tendencies under 
 the leadership of Alexander Hamilton, who was 
 in favor of 'a strong Government/ This policy 
 
48 The Anglo-American Bank 
 
 grew out of a want of faith in the people, and 
 the belief that they were incapable of self-gov- 
 ernment." 
 
 <][ Hamilton expressed his conclusions of Gov- 
 ernments as follows: 
 
 I believe the British Government forms the 
 best model the world ever produced, and such 
 has been its progress in the minds of many 
 that this truth gradually gains ground. All 
 communities divide themselves into the few 
 and the many. The first are rich and well 
 born; the other, the mass of the people. 
 
 tjfHe then states that the rich and well born 
 should govern. 
 
 CJThe money power of the world has never been 
 slow to single out such men for their service. 
 CJ England and her money lenders saw the op- 
 portunity for money lending and money making, 
 in the matchless and boundless resources of this 
 continent and determined to make a debtor 
 country of the United States. To those who 
 know the direct influence they did exert in estab- 
 lishing their money system here, it was not at all 
 surprising that Hamilton was made the first Sec- 
 retary of the Treasury and at once strongly 
 recommended the English system of Banks of 
 Issue. 
 
 CJ On the 13th of December, 1790, Hamilton 
 submitted to Congress his views in reference to 
 the establishment of a National Bank, and from 
 the moment of its incorporation, and the forma- 
 tion of the so-called Bank of the United States, 
 the irrepressible conflict was on between the 
 money power represented by Hamilton and the 
 Tories, who advocated a strong centralized Gov- 
 
A Scheme to Exploit the People 49 
 
 ernment and a Bank of Issue, and the people, 
 represented by Thomas Jefferson, who believed 
 in a Government of the people, by the people and 
 for the people, and that Congress should create 
 money and regulate the value thereof in the in- 
 terest of the people. This is the beginning from 
 which the issues of today have sprung. Up to 
 the present time, the organized money power has 
 won over unorganized democracy, and its greed 
 and oppression have forced the money question 
 again upon the people for a correct solution. 
 <| Through Hamilton's influence Congress char- 
 tered the first so-called Bank of the United States 
 in February, 1791, with a capital of $10,000,- 
 000 for a period of twenty years. 
 IJ Thomas Jefferson as Secretary of State gave 
 a strong written opinion denying the power of 
 Congress to incorporate a Bank of Issue. Madi- 
 son opposed it in Congress and made a powerful 
 speech denouncing it as a violation of the Consti- 
 tution. 
 
 JIn 181.1 this Bank applied to Congress for a 
 renewal of its charter. Henry Clay and other 
 leading statesmen defeated it, on the ground 
 that it was unconstitutional, anti-American and 
 strictly a British institution. 
 
 <JThe second so-called Bank of the United 
 States began business the first of January, 1817. 
 In 1818 the people had become alarmed at its 
 encroachments upon their rights, as well as the 
 evils it inflicted on the public. As a result, the 
 legislative committee of the State of New York 
 made the following report in 1818: 
 
 Of all aristocracies, none more completely 
 enslave a people than that of money; and in 
 
50 The Anglo-American Bank 
 
 the opinion of your committee, no system was 
 ever better devised so perfectly to enslave a 
 community as that of the present mode of con- 
 ducting banking establishments. Like the 
 siren of the fable, they entice to destroy. 
 They hold the purse-strings of society, and by 
 monopolizing the whole of the circulating 
 medium of the country, they form a preca- 
 rious standard by which all the property in the 
 country homes, lands, debts and credits, per- 
 sonal and real estate of all description are 
 valued, thus rendering the whole community 
 dependent upon them; proscribing every man 
 who dares to expose their unlawful practices. 
 
 <JOn October 9, 1839, the second so-called 
 United States Bank closed its doors. 
 <| Ben ton, in his history, "Thirty Years in Con- 
 gress," states: 
 
 An hundred millions of dollars was the 
 lowest at which the destruction was esti- 
 mated; and how such ruin could be worked, 
 and such confidence kept up for so long a time, 
 is the instructive lesson for history; and that 
 lesson the report of the stockholders' commit- 
 tee enables history to give. From this 
 authentic report, it appears from the year 
 1 830 to 1 836 the period of its struggle for a 
 re-charter the loans and discounts of the 
 bank were about doubled its expenses 
 trebled. Near thirty millions of these loans 
 were not of a mercantile character neither 
 made to persons in trade or business. To 
 whom were they made? To members of 
 Congress, to editors of newspapers, to travel- 
 ing politicians, to brokers and jobbers, to 
 
A Scheme to Exploit the People 5 1 
 
 favorites and connections; and all with a view 
 to purchase a re-charter. 
 
 <JIt is shown at this time that the members of 
 Congress were not only improperly interested in 
 this bank but some of the ablest of them even 
 then apprehended the great danger to the Gov- 
 ernment in chartering or allowing a banking cor- 
 poration to issue a substitute for money Daniel 
 Webster had declared his hostility to bank cur- 
 rency repeatedly, as "one of the greatest of 
 political evils," and *'a contrivance for cheating 
 the laboring classes of mankind." 
 <| Henry Clay said in 1811: 
 
 I conceive the establishment of this bank 
 (National Bank) as dangerous to the safety 
 and welfare of this republic. 
 
 Cf Still both were influenced to vote for the re- 
 chartering of this Bank. John Randolph, Sen- 
 ator from Virginia, as a warning, said: 
 
 Charter a bank with thirty-five millions of 
 capital; let it be established and learn its 
 power, and then find, if you can, means to bell 
 the cat. It will be beyond your power, it will 
 overawe your Congress and laugh at your 
 laws. 
 
1861 WAR MEASURES TO RAISE MONEY 
 
 HE condition of the United States at 
 the beginning of the war between 
 the States 1861. The crops had 
 been unusually good and the people 
 of the United States were enjoying 
 prosperous conditions. The state 
 
 of the banks and the currency in 1 86 1 was as 
 
 follows: 
 
 Currency in circulation $202,000,000 
 
 Deposited in Banks 257,200,000 
 
 Loans 696,700,000 
 
 Specie 87,600,000 
 
 National Wealth 1 6, 1 59,6 1 6,000 
 
 War Measures to Raise Money. 
 
 Cf At this time, and during an extra session of 
 Congress July 1 7th, 1 86 1 , a loan act was passed 
 authorizing the Secretary of the Treasury to 
 borrow $250,000,000 and to issue coupon bonds 
 or registered bonds or Treasury Notes as he 
 might deem advisable. 
 
 <|The bonds were to bear interest not exceed- 
 ing seven per cent per annum and they were to 
 run for twenty years. The Treasury Notes were 
 to bear interest at seven and three-tenths per 
 cent and exchangeable at any time for twenty- 
 year six per cent bonds. 
 
 <|By an act of August the 5th, 1861, supple- 
 mentary to the act of July 1 7th, 1 86 1 , the Secre- 
 tary of the Treasury was authorized to issue 
 
Prevent American Money-System 53 
 
 bonds bearing interest at six per cent per annum, 
 payable after twenty years from date of issue, 
 which might be exchanged for Treasury Notes 
 bearing seven and three-tenths per cent interest. 
 I desire to call special attention to these acts of 
 Congress, for in them is contained conclusive 
 evidence that the European and American 
 monied interests were laying their plans to fore- 
 stall the Congress of the United States from ex- 
 ercising its right of sovereignty to create full 
 legal tender money in the interest of the people 
 and establish an American Money System. The 
 Treasury Notes, described in this Act of Con- 
 gress, were handicapped, if not destroyed as a 
 circulating medium, by being turned into a 
 seven and three-tenths per cent investment for 
 money, and in the subsequent Act of Congress 
 made convertible into a six per cent United 
 States Bond, which would eventually retire them 
 as a circulating medium, making way for the 
 issue of Bank Notes The English Money Sys- 
 tem. The subsequent acts of the money power 
 in depreciating the value of these Treasury 
 Notes and the non-legal-tender-notes (green- 
 backs so called), and converting them into 
 bonds is conclusive evidence of the fact. 
 <}This form of Treasury Note, bearing interest 
 and not a legal tender, is really only an evidence 
 of indebtedness and differs only in form from 
 a bond. No private person or corporation is 
 obliged to accept it at its face value in payment 
 for debt, services or property; it therefore lacks 
 the essential qualities of money as a circulating 
 medium. 
 
 CJThe fact that it bears interest and is payable 
 for specific dues or taxes to the Government 
 
54 Anglo- American Money Lenders 
 
 does not help it in its use as money, but offers 
 a premium to those who have obligations to pay 
 to depreciate its value in order to purchase them 
 at a low price. 
 
 ^f Just as was done by the bullionists when they 
 discredited and depreciated the greenbacks 
 non-legal tender notes as they had cornered the 
 gold, it was to their interest to buy greenbacks, 
 with gold, as cheap as they could, and then ex- 
 change them at their face value for United 
 States six per cent bonds. This was the begin- 
 ning of their plan to establish banks of issue to 
 emit credit money based on debts under the 
 title of "National Banks of the United States" 
 which has developed into the present money 
 trust. As additional evidence, I will submit the 
 legislation in the interest of the people, which 
 they subsequently defeated in Congress, to issue 
 legal tender money. 
 
 Legal Tender Act. 
 
 J Introduced in the House of Representatives 
 December 30, 1861. Duly considered by the 
 "Committee on Ways and Means" and on Janu- 
 ary 7, 1862, reported from the Committee to 
 the House. 
 
 IJThe Bill authorizing the Secretary of the 
 Treasury to issue on the credit of the United 
 States $100,000,000 Treasury Notes full legal 
 tender for all debts public and private. 
 tfThis was an honest attempt to establish an 
 American Money System, as provided in the 
 Constitution, and issue full legal tender dollars 
 as the currency of the people of the United 
 States. This bill was no sooner made public than 
 
Prevent American Money-System 55 
 
 an organized effort was made by the monied in- 
 terest, represented by the Bankers of New York, 
 Boston and Philadelphia, to kill it. They at once 
 said that, if a full legal tender American dollar 
 was authorized and issued by the sovereign 
 power of the Congress of the United States, it 
 would be the beginning of a permanent money 
 <3ystern in the interest of the people of the United 
 States, and not in the sole interest of bankers 
 and bullionists. They saw, if this Bill became a 
 Law, it would deprive them of the power to 
 shave either the government or the people. 
 These bankers organized themselves into a dele- 
 gation, hurried to Washington, organized their 
 forces in a formal manner and invited the 
 "Finance Committee of the Senate" and the 
 "Committee of Ways and Means of the House" 
 to meet them in the office of the Secretary of 
 the Treasury of the United States, January 1 1 th, 
 1 862. The meeting was held and they entered 
 their vigorous protest against this bill and sub- 
 mitted their own plans as a substitute from 
 which I quote the following sections. 
 CJ1. "A tax bill to raise 125,000,000 dollars 
 over and above duties on imports by taxation." 
 |2. "Not to issue any demand Treasury notes, 
 except those authorized at the extra session of 
 July last." 
 
 <J3. "A suspension of the sub-treasury act, so 
 as to allow the banks to become depositories of 
 the Government of all loans, and to check on 
 the banks from time to time as the Government 
 may want money." 
 
 <f 4. "Issue six per cent twenty-year bonds, to 
 be negotiated by the Secretary of the Treasury, 
 
56 Anglo-American Money Lenders 
 
 and without any limitation as to the price he 
 may obtain for them in the market." 
 
 |5. "That the Secretary of the Treasury be 
 empowered to make temporary loans to the ex- 
 tent of any portion of the funded stock autho- 
 rized by Congress, with power to hypothecate 
 such stock, and, if such loans are not paid at 
 maturity, to sell the stock hypothecated for the* 
 best market price that can be obtained." 
 <}The following statement in regard to this 
 proposition was printed in the "New York Trib- 
 une" of January 13th, 1862. 
 
 CJ*'The Sub-Committee of Ways and Means 
 objected to any and every form of * 'shinning" 
 by the Government through Wall or State 
 streets and the knocking down of Government 
 Stocks to 75 or 60 cents on the dollar, the in- 
 evitable results of throwing a new and large 
 loan on the market without limitation as to price, 
 and finished by firmly refusing to assent to any 
 scheme that should permit a speculation by 
 brokers, and bankers and others, in the Govern- 
 ment securities and particularly any scheme 
 which should double the public debt of the 
 country, and double the expenses by damaging 
 the credit of the Government." 
 CJThis bankers delegation remained in Wash- 
 ington several days and went into further con- 
 sultation with Secretary Chase, which resulted 
 in an agreement with him that Congress should 
 be urged to pass the National Bank Bill and that 
 the amount of the demand notes already issued 
 by the Secretary of the Treasury should not be 
 increased beyond the 50,000,000 dollars 
 authorized by the Act of July, 1861, and also 
 that Congress should be urged to extend the 
 
Prevent American Money-System 57 
 
 provisions of the existing loan act so as to enable 
 the Secretary of the Treasury to exchange in- 
 terest bearing Treasury Notes for the demand 
 notes, not bearing interest and get them out of 
 the way. 
 
 Influences of Bank of England and the 
 Rothschilds. 
 
 CJ An able writer on this legislation comments 
 as follows: 
 
 <J"Here begins one of the darkest chapters in 
 American history. It will be found that every 
 step taken by Congress from this on, in matters 
 pertaining to the finances of the nation, has been 
 dictated by the money power. Foreign capital- 
 ists, such as the Rothschilds, became deeply in- 
 terested in the scheme of robbery inaugurated 
 by the passage of this Act, and through their 
 agents, such as August Belmont, Banker and 
 whilom chairman of the Democratic National 
 Committee, have aided the money power here 
 materially in controlling the policy of both of 
 the great political parties. The amount stolen 
 from the people during the war by the financial 
 policy then adopted, and which now encumbers 
 the nation in the shape of a bonded debt, pay- 
 able principal and interest in gold, is estimated 
 by such writers upon the subject of finance as 
 J. S. Gibbons (contributor to Johnson's Univer- 
 sal Cyclopedia) at over one thousand million 
 dollars, to say nothing of the thousands of mil- 
 lions of which the people have been robbed in- 
 directly, by means of the pernicious monetary 
 system then foisted upon the country." 
 
58 Anglo- American Money Lenders 
 
 J It is a well-known fact that the Rothschilds 
 were back of the drain on American gold and 
 silver from 1851 to 1 863 when nearly $480,- 
 000,000 went out of this country. And again 
 from 1864 to 1876, when nearly $770,000,000 
 followed. 
 
 <|The British Parliament declared all colonial 
 acts for the issue of paper currency to be void. 
 <|The British Board of Trade also strongly ob- 
 jected as early as 1 764 to the use of legal tender 
 money in the colonies, both realizing it would 
 render the colonies independent of the power of 
 Great Britain. The false basis of their objec- 
 tion being "every medium of exchange should 
 have an intrinsic value, which paper has not." 
 Such has always been the attitude of England 
 on money. 
 
 <|Thaddeus Stevens, Chairman of the Ways 
 and Means Committee, in charge of the Legal 
 Tender Bill, concluded his speech as follows: 
 if "We believe that the credit of the Country 
 will be sustained by it, that under it all classes 
 will be paid in money which they can use, and 
 that it will confer no advantage on the capitalist 
 over the poor laboring man. If this bill shall 
 pass, I shall hail it as the most auspicious mea- 
 sure of this Congress; if it should fail, the result 
 will be more deplorable than any disaster which 
 could befall us." 
 
 <|This Bill passed the House February 6, 1 862, 
 by a vote of 93 to 59. On February 1 4, 1 862, 
 the Bill passed the Senate with the following 
 amendments: 
 
 <| 1 . That the legal tender notes should be re- 
 ceivable for all claims and demands against the 
 United States of every kind whatever, "except 
 
Prevent American Money-System 59 
 for interest on bonds and notes, which shall be 
 
 1 99 
 
 paid in com. 
 
 fj 2. That the Secretary might dispose of United 
 States bonds "at the market value thereof, for 
 coin or Treasury notes." 
 
 <|3. An additional section, No. 5, "that duties 
 on imported goods and proceeds of the sale of 
 public lands," etc., should be set apart to pay 
 coin interest on the debt of the United States; 
 and one per cent, for a sinking fund, etc. 
 t|On the 18th of February, 1862, Mr. Stevens 
 reported the bill, as amended by the Senate, 
 from the Committee of Ways and Means to the 
 House, and said: 
 
 CJ "I hope the Gentlemen of the House will read 
 the amendments. They are very important, 
 and, in my judgment, very pernicious, but I hope 
 the House will examine them." 
 CJ On Wednesday, the 19th, Mr. Spaulding 
 opened the debate. I quote as follows: 
 CJ "Mr. Chairman, I desire especially to oppose 
 the amendment of the Senate which requires the 
 interest on bonds and notes to be paid in coin 
 semi-annually, and which authorizes the Secre- 
 tary of the Treasury to sell six per cent bonds at 
 the market prices for coin to pay the interest." 
 
 "The passage of the measure, The Legal 
 Tender Bill, in this House was hailed with satis- 
 faction by the great mass of the people all over 
 the country. It received the hearty endorsement 
 of such bodies as the Chambers of Commerce of 
 New York, Cincinnati, St. Louis, Chicago, Buf- 
 falo, Milwaukee and other places. I have never 
 known any measure to receive a more hearty ap- 
 proval from the people." 
 
60 Anglo-American Money Lenders 
 
 J "I regret to say that some of the amendments 
 of the Senate render the bill incongruous, and 
 tend to defeat its great object, namely to prevent 
 all forcing of the Government to sell its bonds in 
 the market to the highest bidder for coin. It 
 might be very pleasant for the holders of the 
 seven and three-tenths Treasury notes and six 
 per cent bonds, to receive their interest in coin 
 semi-annually, but very disastrous to the govern- 
 ment to be compelled to sell its bonds, at ruinous 
 rates of discount, every six months to pay them 
 gold and silver, while it would pay only Treas- 
 ury notes to the soldier, sailor and all other cred- 
 itors of the Government. 
 
 J "I am opposed to all those amendments of the 
 Senate which discriminate in favor of the hold- 
 ers of bonds and notes by compelling the Gov- 
 ernment to go into the streets every six months 
 to sell bonds at the 'market price', to purchase 
 gold and silver in order to pay the interest 'in' 
 coin' to the capitalists who now hold United 
 States stocks and Treasury notes heretofore is- 
 sued, or that may hold bonds and notes hereafter 
 to be issued; while all persons in the United 
 States (including the Army and Navy and all 
 who supply them with food and clothing) are 
 compelled to receive non-legal tender Treasury 
 'notes in payment of demands due them from the 
 Government." 
 
 CJP'Why make this discrimination? Who asks 
 to have one class of creditors placed on a better 
 footing than another class? Do the people of 
 New England, the Middle States, or the people 
 of the West and Northwest, or anywhere else in 
 the rural districts, ask to have such discrimina- 
 tion made in their favor? Does the soldier, the 
 
Prevent American Money-System 61 
 
 farmer, the mechanic, or the merchant ask to 
 have any such discrimination made in his favor? 
 No, sir; no such unjust preference is asked for by 
 this class of men. They ask for a legal tender 
 note bill pure and simple. They ask for a na- 
 tional currency which shall be of equal value in 
 all parts of the country. They want a currency 
 that shall pass from hand to hand among all the 
 people in every State, County, City, Town and 
 Village in the United States. 
 CJ "Who then, are they that ask to have a prefer- 
 ence given to them over other creditors of the 
 Government? Sir, it is a very respectable class 
 of gentlemen, but a class of men who are very 
 sharp in all money transactions. They are not 
 generally among the producing classes; not 
 among those who, by their labor and skill, make 
 the wealth of the Country; but a class of men 
 that have accumulated wealth, men who are 
 willing to lend money to the Government if you 
 will make the security beyond all question, give 
 them a high rate of interest, and make it payable 
 in coin. Yes, sir; the men who are asking these 
 extravagant terms, who want to be preferred 
 creditors, are perfectly willing to lend money to 
 the Government in her present embarrassment, 
 if you will only make them perfectly secure, give 
 them extra interest, and put your bonds on the 
 rnarket at the 'market price' to purchase gold 
 and silver to pay them interest every six months. 
 Yes, sir; entirely willing to loan money on these 
 terms! Safe, no hazard, secure, and the interest 
 payable 'in coin' ! Who would not be willing to 
 loan money on such terms? Sir, the legal tender 
 Treasury note bill was intended to avoid all such 
 financiering and protect the Government, and 
 
62 Anglo-American Money Lenders 
 
 people who pay the taxes, from all such hard bar- 
 gains. It was intended as a shield in the hands of 
 the patriotic people of the Country against all 
 forced sales of bonds, and all extravagant rates 
 of interest." 
 
 {J"The very discrimination proposed carries on 
 its face notice to everybody, that although the 
 notes are declared to be 'Lawful money and a 
 partial legal tender in payment of debts,' yet 
 there is something of higher value, that must be 
 sought after at a sacrifice to the Government to 
 pay a peculiar class of creditors to whom it owes 
 money, a kind of absurdity and self-stultification 
 which does not appear well on the face of the 
 bill. It is an unjust discrimination which does 
 not appear well now, and will not look well in 
 history. You will, if the Senate's amendment is 
 adopted, depreciate, by your own acts, your own 
 bonds and notes, and effectually destroy the 
 symmetry and harmonious workings of the 
 whole plan." 
 
 JMr. Stevens closed the debate. I quote from 
 his speech as follows: 
 
 fj "Mr. Speaker, I have a very few words to say, 
 I approach the subject with more depression of 
 spirits than I ever before approached any ques- 
 tion. No personal motive or feeling influences 
 me. I hope not, at least. I have a melancholy 
 foreboding that we are about to consummate a 
 cunningly devised scheme, which will carry great 
 injury and great loss to all classes of the people 
 throughout this Union, except one. With my col- 
 league, I believe that no act of legislation of this 
 Government was ever hailed with as much de- 
 light throughout the whole length and breadth 
 of the Union, by every class of people, without 
 
Prevent American Money-System 63 
 
 any exception, as the Legal Tender Bill we 
 passed and sent to the Senate. Congratulations 
 from all classes: merchants, traders, manufac- 
 turers, mechanics, and laborers poured in upon 
 us from all quarters. The Board of Trade from 
 Boston, New York, Philadelphia, Cincinnati, 
 Louisville, St. Louis, Chicago and Milwaukee 
 approved its provisions and urged its passage as 
 it was. 
 
 <JIt is true there was a doleful sound came up 
 from the caverns of bullion brokers, and from 
 the saloons of the associated banks. Their cash- 
 iers and agents were soon on the ground, and 
 persuaded the Senate, with but little delibera- 
 tion, to mangle and destroy what it had cost the 
 House months to digest, consider, and pass. 
 They fell upon the bill in hot haste, and so dis- 
 figured and deformed it, that its very father 
 would not know it. Instead of being a benefi- 
 cent and invigorating measure, it is now posi- 
 tively mischievous. It has all the bad qualities 
 which its enemies charged on the original bill, 
 and none of its benefits. It now creates money, 
 and by its very terms declares it a depreciated 
 currency. It makes two classes of money one 
 for the banks and brokers, and another for the 
 people. It discriminates between the rights of 
 different classes of creditors, allowing the rich 
 capitalists to demand gold, and compelling the 
 ordinary lender of money on individual security 
 to receive notes which the Government had pur- 
 posely discredited." 
 
 CJIn a speech at Philadelphia January 1 5, 1 876, 
 Judge Kelly says: "I remember the grand 'Old 
 Commoner' (Thaddeus Stevens) with his hat in 
 his hand and his cane under his arm when he re- 
 
64 Anglo-American Money Lenders 
 
 turned to the House after the final conference, 
 and shedding bitter tears over the result. *Yes', 
 said he, 'we had to yield; the Senate was stub- 
 born. We did not yield until we found that the 
 country must be lost or the banks be gratified, 
 and we have sought to save the country in spite 
 of the cupidity of its wealthier citizens." 
 
 Full Legal Tender Act Defeated and Non-Legal 
 Tender "Greenbacks" Authorized. 
 
 J He who reads the history of the fate of this Bill 
 to create a full legal tender dollar and the 
 amendments to this Bill, that substituted the 
 non-legal tender * 'Greenback" for the full-legal- 
 tender dollar; yet characterizes the full-legal 
 tender money herein advocated, as a revival of 
 the "greenback theory," or as a "recrudescence 
 of greenbackism," is either a fool or a knave, 
 CJThus in 1 862 was the legal tender bill defeated 
 and the Government prevented from exercising 
 its highest act of sovereignty to create money 
 and regulate the value thereof and the Inter- 
 national bankers and money lenders prevented 
 the United States from establishing an Ameri- 
 can money system in accord with its constitution 
 and forced upon this republic the British money 
 system, banks of issue and specie redemption. 
 <f It should be borne in mind at this date that the 
 Rothschilds and their correspondents in the 
 United States had cornered all the gold in sight, 
 leaving in the currency system in the United 
 States only $25,000,000, of gold, most of which 
 was in the control of the banking interest. They 
 immediately began to make it abnormally valua- 
 ble by creating extraordinary demands for it, 
 
Prevent American Money-System 65 
 
 consequently they used every effort to depreciate 
 the non-legal tender notes of the Government 
 and bought them for gold which they controlled 
 at less than fifty cents on the dollar, exchanging 
 them at par for United States bonds bearing the 
 highest rate of interest. 
 
 <JSecreary of the Treasury McCulloch, in 
 touch with the foreign bankers and their repre- 
 sentatives in the United States, in his first annual 
 report, December 4th, 1865, to Congress, made 
 the following recommendations which were em- 
 bodied in the act of Congress April 1 2th, 1 866, 
 authorizing the Secretary of the Treasury to sell 
 5-20 bonds, and with the proceeds to retire 6 per 
 cent compound interest, notes and greenbacks, 
 and other evidences of indebtedness of the Gov- 
 ernment. This act gave Secretary McCulloch 
 unlimited control over the monetary system of 
 the United States. The dealers in these war 
 debts in Europe and the United States held hun- 
 dreds of millions of these securities which they 
 had bought at prices ranging from 35 cents on 
 the dollar, up. While these securities were be- 
 ing issued during the war the money power de- 
 preciated their value, in order that they might 
 be bought in at the lowest possible price. With 
 this in view they made the interest on bonds and 
 duties on imports payable in gold only, to dis- 
 credit the Government currency. In order to 
 confuse the people hopelessly on the subject of 
 money they succeeded in having the Treasury 
 Department issue fifteen different forms of its 
 obligations. Therefore, it was impossible for 
 the people at that time to understand all these 
 intermixed and various forms of indebtedness 
 and currency. Issuing the securities of the Gov- 
 
66 Anglo-American Money Lenders 
 
 ernment in these peculiar forms gave the banks 
 a golden opportunity to prey upon the people. 
 
 Move of the Money Power to Make the Princi- 
 pal as well as the Interest on United States 
 Bonds Payable in Gold. 
 
 CJThe money power having possession of all of 
 the outstanding obligations of the Government, 
 immediately began to use their unfailing influ- 
 ence upon Congress and the Treasury to increase 
 their value by making them payable in gold. A 
 living historian at the time describes it as fol- 
 lows: 
 
 [["The first move made by the bullionists and 
 bondholders was to educate the public senti- 
 ment, through the press, in regard to the 'sacred- 
 ness of the public faith.' The leading news- 
 papers of the principal cities took up the song, 
 and before a great while the gentlemen of the 
 country press, who are not quick to learn which 
 way the wind blows, were heard, together with 
 the demagogues of both parties, joining in the 
 chorus." 
 
 J "The Hon. Thaddeus Stevens expressly asked 
 the Chairman of the Ways and Means Commit- 
 tee and was plainly answered by him, that only 
 the interest was payable in coin. Mr. Stevens 
 then continued, 'If I knew that any party in this 
 country would go for paying in coin that which 
 is payable in money, thus enhancing it one-half; 
 if I knew there was such a platform and such de- 
 termination on the part of any party, I would 
 vote on the other side. I would vote for no such 
 swindle upon the tax-payers of this country; I 
 would vote for no such speculation in favor of 
 
Prevent American Money-System 67 
 
 the large bondholders, the millionaires who took 
 advantage of our folly in granting the coin pay- 
 ments of interest/ 
 
 fj Senator Morton declared that "we should do 
 foul injustice to the Government and the people 
 of the United States after having sold these 
 bonds on an average for not more than sixty 
 cents on the dollar, now to propose to make a 
 new contract for the benefit of the bondholders." 
 This historian goes on to state that "The presi- 
 dential campaign of 1 868 was impending and it 
 became necessary for the money power to resort 
 to extraordinary efforts to obtain the direction 
 of political affairs. The Rothschilds were in 
 possession of several hundred miilions of 5-20 
 bonds, purchased at about sixty cents on the dol- 
 lar, or less, and were particularly interested. 
 Their agent, August Belmont, who had secured 
 the position of Chairman of the Democratic Na- 
 tional Committee, was instructed by Baron 
 James Rothschild, as early as March 13, 1868, 
 that unless the Democratic party went for pay- 
 ing the 5-20 bonds in gold, it must be defeated. 
 Belmont and his satellites were unable to control 
 the making of the platform. The platform read, 
 "Resolved, Third: When the obligations of the 
 Government do not expressly state upon their 
 face, or the law under which they were issued 
 does not provide, that they shall be paid in coin, 
 they ought in right to be paid in the lawful 
 money of the United States/ This doomed 
 the party to defeat. The money power was more 
 successful with the Republican party at that time 
 and through their aid Grant was triumphantly 
 elected President. 
 
68 Anglo-American Money Lenders 
 
 n his inaugural address he alluded to "the 
 sacredness of the public faith," and "let it be 
 understood that no repudiator of one farthing of 
 our public debt will be trusted in place." 
 tjln due time such a bill passed Congress and 
 was the first act of Congress receiving Grant's 
 official sanction. 
 
 tJThis Act of Congress was in direct violation 
 of the contract under which these bonds had 
 been issued, and it could have been repealed. 
 Therefore, the Rothschilds and the money 
 power lost no time in getting the Secretary of 
 the Treasury to pay off these bonds in gold or 
 its equivalent. 
 
 <} An able financial writer familiar with this 
 legislation and the influences controlling the 
 then Secretary of the Treasury, discussed it as 
 follows: 
 
 C| "This signal act of robbery, for it is only one of 
 the many acts of robbery which have been per- 
 petrated by the money power during the past 
 few years under the guise of law," will foot up 
 about as follows: 
 
 Amount of 520 6% bonds.$500,000,000.00 
 
 Interest in gold at 6% com- 
 pounded semi-annually 
 for ten years 403,096,132.71 
 
 $903,096,132.71 
 Cost of $500,000,000 bonds 
 at, say, sixty cents on 
 the dollar 300,000,000.00 
 
 Net profit in ten years in 
 
 gold $603,096,132.71 
 
Prevent American Money-System 69 
 
 CJThe next move of the money power was to 
 have the public debt refunded, in order to place 
 its payment in coin beyond all question. This 
 was done by the Act of Congress, July 1 4, 1 870. 
 <J It is clearly shown that the money power had 
 complete control of Congress during all this time 
 and put laws through Congress to suit them- 
 selves, the people occupying the position of the 
 forgotten man. Resumption, 1875, of Specie 
 Payments. At which time Congress was a 
 packed Jury in the Interest of the Money Power. 
 JIn 1875 they put into operation the English 
 scheme of robbing the people, "specie resump- 
 tion," and passed a law decreeing resumption to 
 take place January 1st, 1879. 
 CJHon. Moses W. Field, of Michigan, a member 
 of this, the 43rd Congress, describes its make-up 
 as follows: "Six lumbermen, thirteen manufac- 
 turers, seven doctors, fourteen merchants, thir- 
 teen farmers, three millers, one land surveyor, 
 one priest, one professor of latin, one doctor of 
 laws, one barber, one mechanic, ninety-nine law- 
 yers, and one hundred and eighty-nine bankers, 
 which included stockholders in national banks," 
 a clean majority of them being bankers or inter- 
 ested in national banks. 
 
 fJThe amount of paper emissions of the Gov- 
 ernment, including debts, doing the work of 
 money in 1865 and 1866 was about $1,800,- 
 000,000. The condition of the people in the 
 United States at this time is described as fol- 
 lows: 
 
 C|In 1865-66, after the termination of the war, 
 industry, by reason of the abundance of money 
 in circulation, was rife throughout the country, 
 and production went on as it had never done be- 
 
70 Destruction and Desolation Caused 
 
 fore. The Secretary of the Treasury, McCulloch, 
 himself has since admitted the people were in- 
 dividually out of debt." 
 
 CJ Under such conditions, what reason or justifi- 
 cation could there be found for the resumption 
 of specie payments, for the purpose of contract- 
 ing the circulating medium of the country. It 
 was plainly brought about by the International 
 bankers, or money power, as their next move to 
 permanently establish the gold basis and banks 
 of issue money system, in order to exploit the 
 people of the United States. 
 
 Destruction and Desolation Caused by the Re- 
 sumption of Specie Payments. 
 
 |In the Congressional Report of 1876, page 
 2939, the Hon. Mr. Rea said, speaking to the 
 same question: 
 
 J "I feel it to be my duty to say something in my 
 feeble way in behalf of the thousands of men 
 and women in the United States who are out of 
 employment and begging for bread seeking 
 remunerative employment, but can find none. 
 These are perilous times. Thousands of good 
 business men have become bankrupt, and thou- 
 sands more must soon follow. 
 f "The policy of the contraction of the currency 
 and the increasing of the gold interest-bearing 
 debt of the nation have resulted in great disaster 
 to the business of the country. The people, I 
 believe, are opposed to the policy they are de- 
 manding the repeal of the specie resumption act 
 by which it is proposed to resume specie pay- 
 ment in 1879. Congress should at once repeal 
 
To Establish So-called Gold Standard 7 1 
 
 the resumption act. The people demand it. It 
 is a fraud and a cheat. The people of this coun- 
 try do not favor the conversion of our legal 
 tender currency into an interest-bearing debt. 
 The contraction of the currency should at once 
 be stopped." 
 
 <JThe conspirators in the scheme of contraction 
 were not ignorant of the devastation which fol- 
 lowed their cruel work. There were men in 
 Congress who warned and entreated them. 
 CJIn December, 1866, we had $1,906,687,770 
 in circulation. Col. B. S. Heath, author of 
 Finance Revolution, says: 
 
 <| "During this year, there were but 520 business 
 failures in the while country, involving a loss of 
 but $ 1 7,625,000. Labor was well paid and fully 
 employed. 
 
 <J*'1867. This year of contraction was vigor- 
 ously pushed, and there were 2,386 failures, 
 with a total loss of $86,218,000. 
 J"1868. During this year, $473,000,000 of 
 money was destroyed, and failures increased to 
 2,608, with a loss to creditors of $63,774,000. 
 Money began to be tight, and financial 'spasms' 
 were frequent. 
 
 If"! 869. During this year over $500,000,000 
 of money passed into the cremation furnace, pro- 
 ducing 2,790 business failures, and a loss of 
 $75,054,900. Money growing tighter and 
 wages lower. 
 
 J " 1 870. This year $67,000,000 of money was 
 destroyed, and 3,551 failures took place, in- 
 volving a loss of $88,242,000. Money was 
 scarce and wages of labor were reduced all over 
 the country. 
 
72 Destruction and Desolation Caused 
 
 <J**1871. Thirty-five millions of money this 
 year is retired, with 2,91 5 failures and a loss of 
 $85,250,000. More men out of work and 
 wages cut down. 
 
 C]["1872. Only about $12,000,000 was de- 
 stroyed this year, but such has been the strain 
 upon the business of the country for the past five 
 years that this proved the last straw to 4,069 
 business firms, involving a loss of $ 1 2 1 ,058,000. 
 More cutting of wages and strikes talked of. 
 <J"1873. This year the storm reached its 
 climax. Business had hoped that, with every 
 returning season, prospects would brighten and 
 money would become plenty. Instead of this, 
 however, notwithstanding but $1 ,609,000 were 
 destroyed, the people became panic-stricken, 
 and 5, 1 83 business firms were precipitated, with 
 a loss of $228,499,000. Five hundred thousand 
 men are thrown out of employment; wages cut 
 down all over the country, and strikes are of fre- 
 quent occurrence. 
 
 <J"1874. Notwithstanding the terrible results 
 of the last year, the wine press of contraction 
 still creaks on its hinges of death, as round and 
 round it sweeps out of circulation $75,484,000 
 certificates of indebtedness, which had been 
 made legal tender money, $85,760,000 Treas- 
 ury notes, $6,335,045 legal tenders, $3,000,000 
 fractional currency, and $ 1 ,000,000 bank notes, 
 producing 5,835 failures, and a loss of $155,- 
 239,000 to creditors. A million idle men began 
 to tramp in search of work. Wages still decline, 
 and strikes more numerous. 
 f*'1875. The volume of currency, this year 
 was contracted $40,817,418, and the failures 
 reached 7,740, with loss to creditors of $201,- 
 
To Establish So-called Gold Standard 73 
 
 060,000. Two millions of laborers out of work. 
 Famine and hunger begin to stare them in the 
 face, and * tramping' becomes a profession. 
 'IJ"1876. According to the most reliable esti- 
 mates, the contraction of the currency this year, 
 in the destruction of greenbacks and the with- 
 drawal of bank currency amounted to about 
 $85,000,000, with 9,062 failures, and $191,- 
 000,000 loss, during the first quarter of the year. 
 The aggregate failures for the year reached over 
 10,000, with losses not less than $300,000,000. 
 This does not include losses to stockholders, by 
 foreclosure and sale of railroads. 
 tj "What a record for ten years. Who wonders 
 times were hard, and men idle? Still, with all 
 this array of wreck and ruin, with the finger- 
 board of contraction, at the close of each year, 
 pointing to the cause, the people were asleep, or 
 on their knees praying for some interposition of 
 Providence in their behalf, while John Sherman 
 went marching on with the torch of death, to 
 burn the remaining $300,000,000 of the people's 
 money. 
 
 If' 'Three million men are out of employment. 
 ^"Bankruptcies multiplying with great ra- 
 pidity. 
 
 CJ "The tramp nuisance culminates. 
 CJ "Wages are cut down to starvation prices. 
 CJ "Strikes, riots and general consternation seize 
 the people, and the circulation is cut down to 
 $600,000,000. 
 
 CJ "In 1 873 came the crash, and all the languages 
 of the world cannot describe the agonies suffered 
 by the American people from 1873 to 1879. 
 Thousands and thousands supposed they had 
 enough; enough for their declining years, 
 
74 Destruction and Desolation Caused 
 
 enough for wife and children, and suddenly 
 found themselves paupers and vagrants. Busi- 
 ness stood still. The men stopped digging ore; 
 they stopped felling the forest. The fires died 
 out in the furnaces. The men who had stood 
 in the glare of the forge were in the gloom of 
 despondency. There was no employment for 
 them. The employer could not sell his product. 
 The great factories were closed, the workmen 
 were demoralized, and the roads of the United 
 States were filled with tramps." 
 CJ Abraham Lincoln said: 
 
 if "If a government contracted a debt with a cer- 
 tain amount of money in circulation and then 
 contracted the money volume before the debt 
 was paid, it is the most heinous crime a govern- 
 ment could commit against the people." 
 
GOVERNMENT FORESTALLED IN EXER- 
 CISING ITS HIGHEST ACT OF SOVER- 
 EIGNTY BY BANKS BEING GIVEN THE 
 POWER TO ISSUE A SUBSTITUTE FOR 
 MONEY. 
 
 N the autumn of 1 862 a "Confiden- 
 tial circular" was issued by an 
 agent of European Capitalists to 
 American Bankers, known as "The 
 Hazard Circular." It reads as fol- 
 lows: 
 
 CJ "Slavery is likely to be abolished by the war 
 power, and chattel slavery destroyed. This, I 
 and my European friends are in favor of, for 
 slavery is but the owning of labor, and carries 
 with it the care of the laborer; while the Euro- 
 pean plan, led on by England, IS CAPITAL'S 
 CONTROL OF LABOR, BY CONTROLLING 
 WAGES. THIS CAN BE DONE BY CON- 
 TROLLING THE MONEY ; The great debt 
 that capitalists will see to it is made out of the 
 war, must be used as a measure to control the 
 volume of money. To accomplish this the bonds 
 must be used as a banking basis. We are now 
 waiting to get the Secretary of the Treasury to 
 make this recommendation to Congress." 
 
 National Bankers' Circular. 
 
 <jf"Dear Sir: It is advisable to do all in your 
 power to sustain such daily and weekly news- 
 
76 Highest Act of Sovereignty Transferred 
 
 papers, especially the agricultural and religious 
 press, as will oppose the issuing of greenback 
 paper money, and that you also withhold patron- 
 age or favors from all who will not oppose the 
 Government-issue of money. Let the Govern- 
 ment issue the coin, and the banks issue the 
 paper money of the country; for then we can 
 better protect each other. To repeal the law 
 creating National Banks, or to restore to circula- 
 tion the Government-issue of money, will be to 
 provide the people with money, and will, there- 
 fore, seriously affect your individual profit as 
 bankers and lenders. See your member of Con- 
 gress at once, and engage him to support our in- 
 terest that we may control legislation." 
 IJThis circular was signed by the official repre- 
 sentative of the National Bankers' Association, 
 James Buell. 
 
 CJThe original copy of the Circular was obtained 
 personally by the Hon. Isaac Sharp, Acting Gov- 
 ernor of Kansas (who had been, when very 
 young, a favorite law student of Thaddeus 
 Stevens, hence his interest in the question) , from 
 Mr. J. W. Simcock, the cashier of the First Na- 
 tional Bank of Council Grove, Kansas. Mr. 
 Sharp at the time was attorney for that bank 
 Mr. Simcock at the same time gave him the Cir- 
 cular of the American Bankers' Association 
 signed by Buell. Mr. Sharp states that when in 
 London he traced up Mr. Hazard and found him 
 to be the Solicitor of an English Bankers' Asso- 
 ciation in touch with bankers throughout Eu- 
 rope and was financially connected with the 
 Rothschilds. 
 
Tp Money-Lending Corporations 77 
 
 State of Colorado, 1 
 County of Arapahoe, J s 
 
 Frederick A. Luckenbach, being first duly 
 sworn on oath, deposes and says: I am 62 
 years of age. I was born in Bucks County, 
 Pennsylvania. I removed to the City of Phila- 
 delphia in the year 1 846, and continued to re- 
 side there until 1 866, when I removed to the 
 City of New York. In Philadelphia I was in 
 the furniture business; in New York I 
 branched into machinery and inventions and 
 am the patentee of Luckenbach's Pneumatic 
 Pulverizer, which machines are now in use 
 generally in the eastern part of the United 
 States and in Europe. I now reside in Denver, 
 having removed there from New York two 
 years ago. I am well known in New York. I 
 have been a member of the Produce Exchange 
 and am well acquainted with many members 
 of that body. I am well known by Erastus 
 Wyman. 
 
 In the year 1 865 I visited London, England, 
 for the purpose of placing there Pennsylvania 
 Oil properties in which I was interested. I 
 took with me letters of introduction to many 
 gentlemen in London among them, one to 
 Mr. Ernest Seyd from Robert M. Foust, ex- 
 Treasurer of Philadelphia. I became well ac- 
 quainted with Mr. Seyd and, with his brother, 
 Richard Seyd, who I understand is yet living, 
 I visited London thereafter every year and at 
 each visit renewed my acquaintance with Mr. 
 Seyd, and upon each occasion became his 
 guest one or more times joining his family at 
 dinner or other meals. 
 
78 Highest Act of Sovereignty Transferred 
 
 In February, 1874, while on one of these 
 visits and while his guest for dinner, I, among 
 other things, alluded to rumors afloat of Par- 
 liamentary Corruption and expressed aston- 
 ishment that such corruption should exist. In 
 reply to this, he told me he could relate facts 
 about the corruption of the American Con- 
 gress that would place it far ahead of the Eng- 
 lish Parliament in that line, so far the conver- 
 sation was at the dinner table between us. His 
 brother Richard and others were there also, 
 but this was table-talk between Mr. Ernest 
 Seyd and myself. After the dinner ended, he 
 invited me to another room where he resumed 
 the conversation about legislative corruption. 
 He said: "If you will pledge me your honor 
 as a gentleman not to divulge what I am about 
 to tell while I live, I will convince you, that 
 what I said about the corruption of the Ameri- 
 can Congress is true." I gave him the prom- 
 ise and he then continued, "I went to America 
 in the winter of 1 872-73 authorized to secure, 
 if I could, the passage of a bill demonetizing 
 silver as it was to the interest of those I repre- 
 sented the Governors of the Bank of Eng- 
 land to have it done. I took with me 1 00,- 
 000 Sterling, with instructions that if that was 
 not sufficient to accomplish the object, to 
 draw for another 100,000 or as much more 
 as was necessary." He told me German 
 Bankers were also interested in having it ac- 
 complished. He said he was the financial ad- 
 visor of the Bank. He said, "I saw the Com- 
 mittees of the House and Senate and paid 
 the money and stayed in America until I knew 
 the measure was safe." I asked him if he 
 
To Money-Lending Corporations 79 
 
 would give me the names of the Members to 
 whom he paid the money but this he de- 
 clined to do. He said "Your people will not 
 now comprehend the far-reaching extent of 
 that Measure but they will in after years. 
 Whatever you may think of corruption in the 
 English Parliament, I assure you I would not 
 have dared to make such an attempt here as 
 I did in your Country." 1 expressed my 
 shame to him for my Countrymen in our Leg- 
 islative Bodies. The conversation drifted into 
 other subjects, and after that though I met 
 him many times the matter was never re- 
 ferred to again. 
 
 (Signed) Frederick A. Luckenbach. 
 
 Subscribed and sworn to before me at Den- 
 ver, this 9th day of May, 1 892. 
 
 (Signed) James A. Miller, 
 
 Clerk, Supreme Court, 
 State of Colorado. 
 (Seal) 
 
 fJThe Bankers' Magazine, August, 1873, says: 
 
 In 1872, silver being demonetized in 
 France, England and Holland, a Capital of 
 $500,000 was raised and Ernest Seyd, of Lon- 
 don, was sent to this Country with this fund, 
 as the agent of foreign bondholders and capi- 
 talists, to effect the same object here, which 
 was accomplished. 
 
 <JThe Congressional Record of April, 1872, 
 page 2032, says: 
 
 Ernest Seyd, of London, a distinguished 
 writer and bullionist, who is now here, has 
 
80 Highest Act of Sovereignty Transferred 
 
 given great attention to the subject of mint 
 and coinage. After having examined the first 
 draft of the bill, he made sensible suggestions 
 which the Committee adopted and embodied 
 in the bill. 
 
 It should be borne in mind that in 1 866-67 the 
 people of the United States were generally occu- 
 pied in the great losses and demoralization as 
 the result of the Civil War. Few people, at 
 this time, knew anything about money apart 
 from trying to get hold of dollars to meet their 
 daily needs. There was one man in the United 
 States who was then making a study of it as a 
 means of amassing a private fortune and was co- 
 operating with the leading foreign money-lend- 
 ers and bullionists. John Sherman in 1 868 was 
 chairman of the Finance Committee of the 
 United States Senate. At this time, when hun- 
 dreds of millions of United States bonds were 
 'held in Europe, and when speculation in the 
 debts growing out of our Civil War concentrated 
 in London, Senator John Sherman, fortified 
 with the great prestige of Chairman of the Fi- 
 nance Committee of the United States Senate, 
 visited London in 1 867 in his own interest. At 
 this time no one in the United States was asking 
 or advocating any movement that would affect 
 the use of silver as money. After conferring 
 with these dealers in bonds, in London, Sher- 
 man went over to Paris to attend the Interna- 
 tional Conference of 1 867. Mr. Samuel B. Rug- 
 gles, a member of the New York Chamber of 
 Commerce, in contact with the banking interest 
 of New York, secured the appointment as dele- 
 gate from the United States to that Conference. 
 
To Money-Lending Corporations 81 
 
 Mr. Sherman at once got in contact with Mr. 
 Ruggles in Paris and both of them became 
 strong advocates of the so-called Gold Standard. 
 On the 1 7th day of May, 1 867, Mr. Ruggles ad- 
 dressed a letter to Mr. Sherman in which he 
 stated that the International Conference was 
 thn in session "to agree, if possible, on a com- 
 mon unit of money." The next day, May 1 8th, 
 Mr. Sherman answered Mr. Ruggles. In this let- 
 ter he stated that he favored the proposition, 
 saying: "If this is done, France will surely aban- 
 don the impossible effort of making two stand- 
 ards of value. Gold coins will answer all the 
 purposes of Europe." This letter was read in 
 full to the Conference as the views and opinions 
 of the Chairman of the Finance Committee of 
 the United States Senate. Any one reading this 
 letter in full will see that it was a carefully pre- 
 pared product resulting from the conference 
 held in London by John Sherman and those rep- 
 resenting the European money power, with 
 whom he had made his business connections on a 
 gold basis. On the 6th of January, 1 868, John 
 Sherman introduced in the Senate "A Bill in 
 Relation to the Coinage of Gold and Silver," 
 which was referred to his Committee on Finance, 
 he called this bill up in the Senate on the 9th of 
 June, 1 868, and strongly urged its passage using, 
 as his main argument, the reports of Samuel 
 Ruggles of the proceedings of the Paris Confer- 
 ence. Fortunately, there was on the Senate Fi- 
 nance Committee an honest man of ability who 
 knew something about the money question and 
 exposed the scheme. Senator E. D. Morgan, of 
 New York, submitted a minority report in which 
 he opposed any international regulation of 
 
82 Highest Act of Sovereignty Transferred 
 
 money, as something that would fetter the 
 United States and said, "that it would be well 
 for the government to increase, rather than dis- 
 continue, the coinage of silver and that it should 
 be poured in the current of commerce in full vol- 
 ume ' Mr. Morgan then said: "The war gave us 
 self-assertion of character and removed many 
 impediments to progress. Its expensive lesson 
 will be measurably lost if it fails to impress upon 
 us the fact that we have a distinctive American 
 policy to work out one sufficiently free from 
 the traditions of Europe to be suited to our pecu- 
 liar situation and the genius of our enterprising 
 countrymen." Senator Morgan's opposition 
 killed this bill to demonetize silver. The reading 
 of Mr. Morgan's report settled its fate and it 
 would not have received a single vote in the Sen- 
 ate. Senator Morgan put such a prompt quietus 
 on this bill that its villainous motive was not dis- 
 covered by the leading men in Congress. Those 
 back of it realized at once that they could not af- 
 ford to have it discussed in the open John Sher- 
 man used that stealth and diplomacy which char- 
 acterized his whole life in the United States Sen- 
 ate, and succeeded in doing that, by stealth and 
 chicanery which he and his backers knew was 
 impossible of accomplishment by fair and honest 
 methods. They knew it was a matter of the first 
 importance that their personality and interest in 
 he bill should be concealed from the public. In 
 order to do this they had a long and technical 
 bill framed by Boutwell through John Jay Knox 
 in 1 870 at a time when the subject was not be- 
 fore the people and little or no interest was taken 
 in it as it was thought to be a scientific Mint bill 
 
To Money-Lending Corporations 83 
 
 drawn up by specialists in the U. S. Mint and 
 Treasury. 
 
 IJThis bill was entitled "An act revising and 
 amending the laws relative to the Mints, assay 
 offices and coinage of the United States," and 
 was always represented to Congress as a meas- 
 ure for the sole convenience of the specialists in 
 the Mint and Treasury. It should be borne in 
 mind that at this time the United States needed 
 all the money that it could posibly get through 
 the operations of the Mint to carry on the tre- 
 mendous task of developing the resources of the 
 country and paying off its bonded indebtedness 
 that had been forced upon the people by the 
 money power back of this bill. Yet the above 
 methods were resorted to by the money powers 
 to prevent the United States from adding to the 
 money supply, their object being to convert sil- 
 ver money into debts, thereby contracting the 
 currency and at the same time making the hun- 
 dreds of millions of United States bonds that 
 they held, payable in gold. This was done with- 
 out the knowledge of the voters or taxpayers of 
 the country, who had to meet these obligations, 
 and suffer the loss and fearful consequences of 
 this treasonable act. The record will show that 
 the leading men in the Congress of the United 
 States were absolutely ignorant of this infamous 
 conspiracy. I give the testimony of the repre- 
 sentatives of the people in Congress, including 
 the President of the United States at that time 
 as to the passage of this bill. 
 
 IJU. S. Grant stated: "I did not know that the 
 act of 1 873 demonetized silver. I was deceived 
 in the matter." 
 t| Senator Morgan, December 12th, 1877: 
 
84 Highest Act of Sovereignty Transferred 
 
 <jf"Did the people demonetize silver? Never! 
 It cannot even be fairly said that Congress did it. 
 It was done in a corner darkly. It was done at 
 the instigation of the bondholders and other 
 money kings, who now, with upturned eyes, de- 
 plore the wickedness we exhibit in asking the 
 question, even, who did this great wrong against 
 the toiling millions of our people?" 
 Judge Kelly, in the House, May 1 0th, 1 879: 
 CJ "Never having heard until a long time after its 
 enactment into law of the substitution in the 
 Senate of the section which dropped the Stand- 
 ard dollar, I profess to know nothing of its his- 
 tory; but I am prepared to say that in all the leg- 
 islation of this country there is no mystery like 
 the demonetization of the standard silver dollar 
 of the United States." 
 
 CJ Senator Voorhees, January 1 5th, 1 878: 
 <J"No man has ever dared to whisper of a con- 
 templated assault upon it (the Standard silver 
 dollar) and when the twelfth day of February, 
 1873, approached, the day of doom to this 
 American dollar, the dollar of our fathers, how 
 silent was the work of the enemy! Not a sound, 
 hot a word, no note of warning to the American 
 people that their favorite coin was about to be 
 destroyed; that the greatest financial revolution 
 of modern times was in contemplation and about 
 to be accomplished against their dearest rights! 
 Never since the foundation of the government 
 has a law of such vital and tremendous import, 
 or indeed of any importance at all, crawled into 
 our statute books so furtively or noiselessly as 
 this. Its enactment there was so completely un- 
 known to the people, and indeed to four-fifths 
 of Congress itself, as the presence of a burglar in 
 
To Money-Lending Corporations 85 
 
 a house at midnight to its sleeping inmates. This 
 was rendered possible partly because the clan- 
 destine movement was so utterly unexpected 
 and partly from the nature of the bill in which it 
 occurred. The silver dollar of American history 
 was demonetized in an act entitled "An act re- 
 vising and amending the laws relative to the 
 mints, assay offices and coinage of the United 
 States." 
 
 CJ Senator Howe February 5th, 1 878: 
 C][*'The act of 1 873, I charge it with guilt com- 
 pared with which the robbery of $200,000,000 
 is venial." 
 
 Senator Beck, January 1 Oth, 1 878: 
 J"It (the bill demonetizing silver) never was 
 understood by either House of Congress. I say 
 that with full knowledge of the facts No news- 
 paper reporter and they are the most vigilant 
 men I ever saw in obtaining information dis- 
 covered that it had been done." 
 <J Senator Beck, "I know that the bondholders 
 and the monopolists of this country are seeking 
 to destroy all the industries of this people, in 
 their greed to enhance the value of their gold. I 
 know that the act of 1873 did more than all else 
 to accomplish that result, and the demonetiza- 
 tion act of the Revised Statutes was an illegal 
 and unconstitutional consummation of the 
 fraud." 
 
 <JThis law struck down the silver money of 
 the government in 1873 which, by construc- 
 tion, became debts payable in gold. It should 
 be remembered at this time that the money 
 power back of the demonetization of silver had 
 previously succeeded in stopping the govern- 
 
86 Highest Act of Sovereignty Transferred 
 
 ment from issuing its full legal tender money 
 and had established National Banks of Issue in 
 the United. States therefore the destruction of 
 the legal tender silver money of the government 
 left the National Banks completely in control of 
 the currency based upon the fraudulent founda- 
 tion of gold which these International bankers 
 could manipulate and control. 
 
NATIONAL BANKS. 
 
 ALMON P. CHASE became Secre- 
 tary of the United States Treasury. 
 He had had no previous experience 
 to qualify him for the position and 
 was in f reindly relations with lead- 
 ing bankers in New York. He was 
 a man of good standing in the legal profession. 
 Under the influence of the banking interest, as 
 soon as he became Secretary of the Treasury, he 
 was enlisted in a scheme to destroy the Old State 
 Banks and to establish so-called National Banks 
 of Issue, those back of him having determined 
 that the Government should be prevented from 
 issuing its own legal tender money, thus estab- 
 lishing an American Money System in the inter- 
 est of the people. 
 
 <J I would call especial attention to the fact that 
 John Sherman was in charge of the bill and made 
 a favorable report upon same from the Finance 
 Committee of the Senate on February 2, 1 863. 
 It was taken up in the Senate on February the 
 ninth and passed on February twelfth by a vote 
 of 22 to 2 1 . It was then sent to the House on the 
 thirteenth of February and never referred to the 
 Committee on Ways and Means, which should 
 have been its regular order; was taken up on the 
 nineteenth and passed the House on the twen- 
 tieth of this same month by a vote of 78 to 64. It 
 was approved by the President and became a 
 law February 25th, 1863. 
 
Called National Banks 
 
 CjfThus this bill changed the whole currency 
 system of this country and transferred the 
 sovereign right of the Government "to issue 
 money" to Banking Corporations organized for 
 private gain. Thus we see the vicious principles 
 of the two so-called United States Banks perpet- 
 uated in the hydra-headed so-called National 
 Banks of the United States. 
 
 J At this time, when the attention of the people 
 was entirely diverted from this subject, and ob- 
 livious of the real nature and character of the 
 bill, being absorbed in all the excitement and 
 exigencies of a civil war, John Sherman, as the 
 agent and attorney of the money power, takes 
 advantage of this opportunity to inflict upon the 
 United States the pernicious English System of 
 banks of issue and passed this bill through both 
 Houses of Congress in the short space of ten 
 days. 
 
 IfThe fifth section of the act incorporating Na- 
 tional Banks provides as follows: "No Associa- 
 tion is authorized to commence business until it 
 shall have deposited United States Bonds to the 
 amount of $30,000 with the Treasurer of the 
 United States. Sixth: Every such association is 
 entitled to receive from the Comptroller of the 
 Currency circulating notes to the amount of 
 ninety per cent of the Capital Stock, if it does 
 not exceed $500,000; eighty per cent, if it ex- 
 ceeds $500,000 and does not exceed $1,000,- 
 000; seventy-five per cent if it exceeds $1 ,000,- 
 000 but does not exceed $3,000,000, and sixty 
 per cent if it exceeds $3,000,000. It should be 
 borne in mind that no national bank notes were 
 issued until 1864 and that the $500,000,000 
 of 5 20 bonds were not sold until the latter part 
 
Money-Lending Corporations 89 
 
 of 1 863 ; therefore matters were not yet in good 
 shape for the bankers and bullionists. But in 
 1 864 their plans were perfected to run up gold 
 to the highest premium. Mr. Fessenden, who 
 was then Secretary of the Treasury, pronounced 
 the action very unpatriotic. United States 
 Bonds bearing 6% interest were bought at this 
 time as low as 35 cents on the dollar, in gold. 
 (|Thus the bankers and bullionists by depress- 
 ing the value of United States Bonds were en* 
 abled to buy them at this low price to establish 
 national banks in this Country. 
 | In order to show that National Banks were not 
 instituted as a war measure for relief of the peo- 
 ple, an examination will disclose that, on July 1 , 
 1 865, after the close of the war, there were only 
 $146,366,030 bank notes issued. Thus these 
 banks of issue were foisted upon the United 
 States at a time when they were neither desired 
 nor needed. The whole purpose of those back of 
 the Scheme was to prevent the Government 
 from exercising its constitutional function to is- 
 sue money in order that the banks might usurp 
 that power. 
 
 JThe question involved was one entirely as to 
 the quantity of money to be issued. Will any- 
 one contend that the United States at that time 
 could not have sustained the value of and re- 
 deemed all the full legal tender dollars necessary 
 to meet the expenses of the war when the rail- 
 roads alone in the United States have made 
 themselves responsible for the payment, dollar 
 for dollar, of about 9 billion dollars of bonds and 
 8 billion dollars of stock. The former would 
 have been secured upon the entire wealth or as- 
 sets of the United States, and the latter simply on 
 
90 Called National Banks 
 
 the railroad properties and their earning powers. 
 CJThe development of the United States after 
 the war is the conclusive answer. 
 CJIn 1865 total money in circulation in the 
 United States was $770,129,755, and only 
 reached as high as $774,445,61 in 1873 or a 
 per capita circulation of $1 8.04. 
 flln 1865 National Wealth $22,067,472,- 
 000. 
 
 J Population 34,748,000. 
 
 IJWill anyone contend that, with a national 
 wealth of over 22 billion dollars, with a popula- 
 tion of over thirty-four million in a country pro- 
 ducing everything the human family requires, 
 the United States was not justified in issuing an 
 increase of full legal tender money to meet the 
 needs of the Government, when it is shown 
 that the National wealth increased to over $32,- 
 000,000,000 by 1 873 and its population to 41 ,- 
 677,000? 
 
 <| Instead of the United States issuing its full 
 legal tender money redeemable in its entire Na- 
 tional wealth, which was increasing faster than 
 that of any other country, and the services of 
 more than thirty-four million people working in 
 the most productive country in the world, Con- 
 gress authorized Banking Corporations to issue, 
 indirectly, a spurious National Currency, yet 
 based upon the National wealth, in the form of a 
 United . States Bond, payable by the people in 
 gold, with interest and thus allowed the money 
 lenders to control the Money System of the 
 United States. 
 
 C|f Previous to 1865 Lord Goschen, the leading 
 English authority on money and foreign ex- 
 change, fully realized it, and stated: 
 
Money-Lending Corporations 91 
 
 CJ "What, it may be asked, will be the value of 
 gold to them the people of the United States 
 if they neither require it for internal circulation, 
 which they may think can be managed as well 
 by paper, nor for payment for foreign liabilities 
 from which, under our hypotheses, they will be 
 comparatively free." 
 
 CJZach Chandler, a high Republican authority, 
 made this statement on April 29th, 1869; see 
 Congressional Globe, page 1 850. 
 CJ"I move to strike out, after United States, 
 'elsewhere/ I am opposed to contracting a for- 
 eign loan under any circumstances. We have 
 gone through the war without borrowing one 
 dollar from abroad. If our bonds have gone 
 abroad it is because the money was sent here to 
 buy them and take them, but I am opposed now 
 to applying to the English stock exchange or any 
 foreign stock exchange, hat in hand, begging 
 that they will now, that we do not need it, loan 
 to us a little money. We have shown our ability 
 to carry this debt, and I am opposed to contract- 
 ing a loan anywhere." 
 
 CJ Salmon P. Chase, Ex-Secretary of the United 
 States Treasury, admitted: 
 
 tjf"My agency in procuring the passage of the 
 national banking act was the mistake of my life. 
 It has built up a monopoly that affects every in- 
 terest in the country. It should be repealed. But 
 before this can be accomplished the people will 
 be arrayed on one side and the banks on the 
 other in a contest such as we have never seen in 
 this country." 
 
 CJF. J. Scott, in the North American Review of 
 September, 1885, set forth in graphic language 
 the power of this banking institution against 
 
92 Called National Banks 
 
 which the masses are protesting. He said: "The 
 unity of the national banking interest threatens 
 the corruption and control of the machinery of 
 political parties. Its power is omnipresent. It 
 is subtle and strong to maintain laws for its own 
 private profit. The Jesuits of two centuries ago 
 had no more efficient organization for con- 
 trolling with unseen hand the governments un- 
 der which they lived. 
 
 CJ Behold our banking association changed in the 
 twinkling of an eye from one having one hun- 
 dred thousand dollars of its own money to invest, 
 to one with that amount securely invested, and 
 ninety thousand dollars more in hand to lend. 
 Was ever ninety thousand dollars more deftly 
 taken in? Were this pretty subsidy the only ob- 
 jection to the system, it migh be let alone; * * * 
 but the principle upon which the system is 
 founded is dangerous to the stability of business 
 and steadiness of values. 
 
 Cf In Congress, where alone this power may be 
 modified or destroyed, a large number of mem- 
 bers of both Houses are officers and stockholders 
 of the National Banks, and have not yet been 
 known from any delicate appreciation of their 
 public duties to refrain from voting on questions 
 concerning the banks on account of having pri- 
 vate interests therein." 
 
ANALYSIS OF THE PROPOSED MORGAN- 
 ROTHSCHILD S-ALDRICH MONEY 
 TRUST BILL MISNAMED THE "NA- 
 TIONAL RESERVE ASSOCIATION OF 
 THE UNITED STATES." 
 
 EC. 1 . The proposed Bill to incorpo- 
 rate the National Reserve Associa- 
 tion of the United States asks the 
 Congress, or the people of the 
 United States, to grant them, as a 
 private banking and money-lending 
 corporation, a charter for the term of fifty 
 years First, to have an authorized capital of 
 20% of the banks now capitalized at $2,000,- 
 000,000, as all of them will be forced into mem- 
 bership of this association by the very dominat- 
 ing power asked to be conferred upon it by the 
 sovereign power of the people of the United 
 States, making it "The National Reserve As- 
 sociation of the United States" thus by start- 
 ing with only one hundred million dollars of its 
 capital paid in cash by the Associated banks, of 
 anybody's money. The other one hundred mil- 
 lion subscribed, and to be paid only when they 
 themselves require it, puts this incorporated 
 Company of bankers in position to start business 
 as follows 
 
 20% of the paid in capital of all 
 
 banks eligible for membership 
 
 about $400,000,000 
 
 Cash Capital paid in 100,000,000 
 
94 The Money Trust Exposed 
 
 Cash deposited without interest 
 
 by U. S. Treasury 356,000,000 
 
 $856,000,000 
 
 Note issue grant by U. S. Govern- 
 ment without charge 900,000,000 
 
 Note issue additional Charge of 
 
 \\% 250,000,000 
 
 $2,106,000,000 
 
 CJ To be loaned back to the people granting them 
 this privilege; and inflated with hundreds of 
 millions of bank credits. 
 
 <|Sec. 23. Provides that all the receipts of the 
 Government, amounting to hundreds of millions 
 of dollars in cash, shall be deposited with this in- 
 corporation of banks without interest; on the 
 other hand, all the disbursements made for the 
 Government will sooner or later be paid by the 
 checks of this banking corporation. 
 tJThis in addition to turning over to it without 
 charges the general cash funds of the Govern- 
 ment. 
 
 fJBy this operation the people lose the interest 
 
 on this tremendous amount of money owned by 
 
 them. 
 
 J But this absurdity goes further and allows this 
 
 money monopoly to lend this money back to the 
 
 people who own it for all they can extort from 
 
 them. 
 
 <J It is even worse than this. By turning the sur- 
 plus money, in the United States Treasury, over 
 to this Corporation, it offers a premium to them 
 to increase the taxes of the people to increase the 
 
Senate Bill 4431 to Incorporate 95 
 
 surplus, or force the issue of bonds, to add to this 
 surplus, to be used by them free of interest. 
 JSec. 10. Provides for the organization of a 
 close corporation to manage and control the 
 money of the people of the United States 
 through this so-called National Reserve Associa- 
 tion, while a thin attempt is made to mislead the 
 people by saying that the President of the United 
 States, representing the people, will select its 
 governor. Yet they effectually say that he can 
 not make any selection, but will have to desig- 
 nate one out of the three names they themselves 
 select, any one of whom would, of course, be sat- 
 isfactory otherwise they would not send his 
 name in. 
 
 JThe two deputy governors being selected by 
 the board itself, and the board of directors ap- 
 point the other officers. 
 
 (JThis plan effectually shuts out any influence 
 of the people over the Organization. 
 <JWhy call this incorporation of banking and 
 money-lending associations of men, "The Na- 
 tional Reserve Association of the United 
 States" ? Its very name is a lie on its face, and a 
 deliberate attempt to use the great seal and sov- 
 ereignty of this Republic to swindle the people 
 and create a money trust to control the circulat- 
 ing medium, money, which puts the business of 
 the people entirely at their mercy. 
 <J No regard is shown to the sovereignty of the 
 States or state lines. This money-lending cor- 
 poration subdivides and farms out the different 
 sections of the United States according to their 
 own interest, and by withdrawing or withhold- 
 ing money or credit from any section can dry up 
 its arteries of trade and transfer its business to 
 
96 The Money Trust Exposed 
 
 some other locality in which the moneyed men 
 controlling the funds are more interested. 
 If With this control would rest the business fate 
 of communities. 
 
 JThe people of the different states would have 
 no control over this private monopoly of the 
 money of the United States, and by the power to 
 discriminate and withhold money, and credit 
 from a sovereign state, this money Trust could 
 control its business and political future. 
 Cf Sec. 25. By the operation of this section this 
 so-called National Reserve Association will get 
 the use of all the reserves, and surplus of deposit- 
 ing banks, without paying them any interest 
 upon same. 
 
 CJSec. 24. The power is here given to deal and 
 speculate in the debts of the United States and 
 all the states of the Union. These have al- 
 ways been the coveted securities of the money 
 lenders of the Old World. The house of Roths- 
 childs was established by committing a national 
 fraud upon the English people, in order to secure 
 their Government bonds at the lowest possible 
 price, and in order to do so the founder of this 
 house coined a deliberate lie; he hurried from 
 the field of battle to London and stated that Lord 
 Wellington had been defeated in the battle of 
 Waterloo, thus destroying the value of the bonds 
 before buying them. The money lenders encom- 
 passed England's financial bondage through 
 credit money issued on debts, which is the primal 
 cause of all her industrial troubles of today, and 
 will eventually destroy the English Govern- 
 ment. 
 | It's the inevitable result of a money system in 
 
Senate Bill 443 1 to Incorporate 97 
 
 favor of banking associations and money lenders 
 instead of the whole people. 
 
 1} The fortunes of this one family of money lend- 
 ers, the Rothschilds, is now estimated at $3,000,- 
 000,000, while on the other hand millions of the 
 real working people of England are unable to get 
 their daily bread. 
 
 If Thus the money lenders rivet their control 
 over the policies of nations. Governments, 
 States and individuals alike are enslaved by 
 debts, for bonds mean bondage, and it is the 
 world-old story of the debtor and creditor. The 
 accumulation of debt will destroy a Nation as an 
 individual. 
 
 J Sec. 24. Also contains the following: 
 fj # # # "The purchase or sale of securities of for- 
 eign governments or gold coin or bullion*" 
 <JThis lends the endorsement of this Republic 
 to this chain of incorporated banks to use the 
 money of the people of the United States to buy 
 the bonds and securities of the practically bank- 
 rupt countries of Europe, while thousands in the 
 United States are denied the use of money in pro- 
 ductive and legitimate enterprises. 
 ^ It is now a well-known fact that most of the 
 foreign governments can only pay the interest 
 on their National Debts and are absolutely un- 
 able to pay the principal. 
 
 JThe National Debt of Great Britain alone 
 amounts to $6, 1 96,038,685. 
 
 <J Now we come to this gold swindle * * * "pur- 
 chase and sell gold or bullion." Read all the 
 proceedings of the International Conferences on 
 money and you will easily detect in this the un- 
 mistakable ear-marks of the Rothschilds' Bank 
 of England and the International banking houses 
 
98 The Money Trust Exposed 
 
 of Belmont, Morgan & Company co-operating 
 with them. This is confirmed in unmistakable 
 terms in all the correspondence between them 
 and the United States Treasury since 1 865, in re- 
 gard to bonds and gold payments, whereby 
 they prevented the United States Government 
 from issuing money in the interest of the people. 
 tJSec. 26. Provided that the National Reserve 
 Association will only rediscount the paper of 
 banks having a deposit with it. This means that 
 any bank failing to keep its surplus funds depos- 
 ited with it in time of prosperity will have to 
 stand alone in times of adversity, and go into 
 bankruptcy if a run is made on it. 
 (^ This power is sufficient to dominate or destroy 
 every small bank throughout the country. 
 CfSecs. 27 & 28. Give the banks depositing 
 with the National Reserve Associations advan- 
 tage over independent banks and would enable 
 them to do a much larger business on the same 
 amount of money, and by being able to redis- 
 count their paper make larger loans and increase 
 the opportunity of those controlling the money 
 of the bank, and engaged in underwriting stocks 
 and bonds of Industrial and other corporations, 
 for their individual profits. 
 
 Sees. 48 & 49. Provide for the retirement of 
 National Bank Notes by the substitution of the 
 notes of this so-called National Reserve Associa- 
 tion or Money Trust with the further power to 
 "issue further notes from time to time to meet 
 the business requirements, it being the policy of 
 the United States to retire as rapidly as possible, 
 consistent with the public interests, bond se- 
 cured circulation and to substitute therefor 
 notes of the National Reserve Association of 
 
 
Senate Bill 443 1 to Incorporate 99 
 
 character and secured and redeemed in the man- 
 ner provided for in this act. Stripped of its mis- 
 leading verbiage, this simply means that the 
 United States surrenders to this money lending 
 and money manipulating monopoly its sover- 
 eign power to create, issue and regulate the 
 value of money. 
 
 tj There is no such thing as money without the 
 imprint upon it of the great law of legal tender, 
 which can only be given it by an act of sov- 
 ereignty. 
 
 ff Yet this highest act of sovereignty, which obli- 
 gates the property and services of the 94,000,- 
 000 people in the United States for its money re- 
 demption, is to be transferred by the representa- 
 tives of the people to this incorporated bankers' 
 association, in order that they may issue credit 
 money as a substitute, thereby establishing a 
 Money System by which the bankers will pros- 
 per and rule instead of the people. 
 J Now I will show that, after granting this mo- 
 nopoly over money and thereby giving almost 
 unlimited power to a corporation to exploit the 
 people, the people themselves are bound to re- 
 deem this credit money in gold even if they have 
 to issue bonds and increase the public debt with- 
 out end in order to do it. 
 
 CJ Mark carefully this apparently careless refer- 
 ence in Sec. 52 of this bill "The circulating notes 
 of the National Reserve Association * * * shall 
 be redeemed in lawful money on presentation at 
 the head office of said association or any of its 
 branches. It shall be the duty of the National 
 Reserve Association to maintain at all times the 
 parity of value of its circulating notes with the 
 standard established by the first section of the 
 
1 00 The Money Trust Exposed 
 
 act of March 14, 1900, entitled, "An act to de- 
 fine and fix the standard of value, to maintain 
 the parity of all forms of money issued or coined 
 by the United States." 
 
 IThis is the act of Congress, March 14, 1900, 
 which established the so-called gold standard, 
 and by the construction of the United States 
 Treasury the redemption of all other kinds of 
 money issued in gold coin. 
 
 CJ Therefore, according to this construction, the 
 only way these promises to pay or credit money 
 issued by this Corporation can be kept at a 
 parity is by redeeming them in gold coin. 
 CjjThus when their notes are presented for re- 
 demption, this so-called National Reserve Asso- 
 ciation will either have accumulated in its con- 
 trol all the gold and gold certificates to redeem 
 them or use the endless chain operation now 
 available to raid the United States Treasury of 
 its gold even to the extent of forcing bond issues 
 upon the Government to replenish the gold re- 
 serve in order that they may withdraw it to re- 
 deem their notes. 
 
 J As a matter of fact, this association could and 
 would in a short time hold almost all forms of 
 money issued by the United States and force 
 their promises to pay or credit money as a sub- 
 stitute upon the people. 
 
 fj It is thus shown that the government, while re- 
 fusing to use its sovereign power directly to 
 create and regulate the value of money in the in- 
 terest of the whole people, would delegate this 
 highest act of sovereignty to a money monopoly, 
 to be used indirectly to issue credit money as a 
 substitute in the interest of bankers, promoters 
 and manufacturers of debts upon the people, and 
 
Senate Bill 4431 to Incorporated: ;IQI ', 
 
 make the people liable for the redemption of 
 their promises to pay in gold. Under the oper- 
 ation of this scheme, war is no longer necessary 
 to force the issue of United States bonds and 
 perpetuate the public debt, in order that the 
 power of money may control the business and 
 political future of the United States. 
 <JThe establishment of this money corporation 
 would not only make it the master of the market, 
 but, by this scheme of gold redemption, put this 
 money monopoly in position to throw the whole 
 country into a panic at any time, and reap a har- 
 vest from the wreckage thus created. 
 ^[Sec. 53. Provides that the notes of this asso- 
 ciation, "promises to pay," shall be received by 
 the United States at par for all taxes, etc. Yet 
 this credit concern, after using its notes to buy 
 the $712,170,320 of United States Bonds (See 
 Sec. 49) declines to accept its own notes for 
 their payment or redemption and requires these 
 bonds, when owned by them, to be paid for spe- 
 cifically in gold coin of the United States. Sec. 
 55. Goes on to provide that upon application of 
 the National Reserve Association the Secretary 
 of the Treasury shall exchange these bonds bear- 
 ing 2% interest for bonds bearing 3% interest and 
 to run for 50 years, principal and interest pay- 
 able in gold coin of the United States. 
 ][This means the Corporation is allowed to buy 
 at par the 2% bonds of the United States, with its 
 notes that cost them nothing to issue, and these 
 bonds are immediately replaced by the Secre- 
 tary of the Treasury with 3% bonds of the United 
 States to run for 50 years. Thus the people, 
 through their representatives in Congress, would 
 be placed in the absurd attitude of giving this 
 
The Money Trust Exposed 
 
 corporation $712,170,320 of United States 
 Bonds earning 3% and convertible into cash at 
 anytime for the non-interest-bearing promises to 
 pay of this money-lending Corporation. Mark 
 carefully the following: "The National Reserve 
 Association shall issue, on the terms herein pro- 
 vided, its own notes as the outstanding notes se- 
 cured by such bonds so held shall be presented 
 for redemption and may issue further notes from 
 time to time to meet business requirements, it 
 being the policy of the United States to retire as 
 rapidly as possible, consistently with the public 
 interest, bond-secured circulation and to substi- 
 tute therefor notes of the National Reserve Asso- 
 ciation secured and redeemed in the manner pro- 
 vided for in this act. 
 
 tj This Bill gives to this corporation the absolute 
 power, entirely independent of the Government, 
 to inflate or contract the currency, the circulat- 
 ing medium of exchange upon which the busi- 
 ness of the people of this country absolutely de- 
 pends. 
 
 <}The future of this Republic is thus virtually 
 placed in their hands 
 
 JSec. ^50. Provides only that the "Credit 
 Money" promises to pay issued by this corpora- 
 tion are to be covered by the $71 1,170,320 of 
 bonds of the United States upon which they earn 
 3% interest, paid by taxing the people, to whom 
 they loan the $7 1 1 , 1 70,320 for the highest rate 
 of interest they can exact, ranging from 6% to 
 10% on commercial paper, and large commis- 
 sions when used in financing or underwriting in- 
 dustrial schemes and building up Trust Com- 
 binations to exploit the people. 
 
Senate Bill 4431 to Incorporate 103 
 
 ^f All additional note issues or credit money put 
 out by this Corporation can be covered by one- 
 third of the amount in gold and by notes or bills 
 of exchange arising out of commercial transac- 
 tions for two-thirds. 
 
 IJIt would only be necessary for this corpora- 
 tion to hold in its banks the promises to pay al- 
 ready issued by the Government, also the real 
 money or legal tender dollars deposited with 
 them by the people, and put out its "credit 
 money" notes in place of those in the channels of 
 trade and commerce. This would put it in a posi- 
 tion to take the silver certificates and other prom- 
 ises to pay issued by the Government and ex- 
 change them for gold. In this way it could easily 
 collect practically all the gold in the monetary 
 system of the United States. 
 
 jlt could then use the stocks and bonds of In- 
 dustrial Corporations or any miscellaneous as- 
 sets held by it adding one-third in gold and issue 
 its notes as money for the full amount of same. 
 if As there is so much gold in the United States, 
 $ 1 ,797,62 1 ,05 1 (See Director of the Mint, page 
 43, 1911), this corporation could easily acquire 
 90% of the whole, which would enable it to issue 
 $4,853,576,838 free of charge and add to this 
 indefinitely by buying or borrowing gold as this 
 bill authorizes, including foreign coin and 
 bullion in itself not worth more than 50 cents on 
 the dollar. 
 
 ff Here we have the climax of the gold confi- 
 dence-game. This Money Trust holding prac- 
 tically all the gold in the United States and the 
 outstanding obligations among the people, spe- 
 cifically payable in gold, amounting to over 
 twenty billion dollars are in complete control. 
 
1 04 The Money Trust Exposed 
 
 <J Imagine for one moment the effect upon the 
 value of gold, as measured in the fall of prices of 
 other things when a general demand is made for 
 gold payments of these obligations. 
 J No man can measure the ruin that would fol- 
 low, and no man can measure the harvest to be 
 gathered by the holders of the gold. 
 
MORGAN. ROTH SCHILDS- ALDRICH 
 MONEY TRUST BILL NOW PENDING 
 IN CONGRESS, AND ENDORSED BY 
 "THE NATIONAL MONETARY COMMIS- 
 SION" THE MISUSE OF THE WORD 
 "PARITY" THEIR LAST HOPE OF 
 FOOLING THE PEOPLE. 
 
 N the careful investigation I have 
 made, for thirty years, of the 
 money question, I find that the peo- 
 ple have been imposed upon by 
 those constructing and developing 
 the money system by assuming 
 false premises and clothing them in technical 
 words and sophistry, and then having them en- 
 dorsed by men in high official positions, and with 
 the prestige of so-called financial authorities. 
 There is no more conspicuous example of this 
 than is found in the injection of the metal gold 
 into our money unit or dollar, trying to make the 
 people believe that gold, the metal, is the unit 
 of value, instead of the dollar. The 25 and 8- 1 
 grains of gold is not the money unit of the United 
 States, nor is it in any sense the standard of value 
 of the purchasing power of our money unit the 
 dollar. This false assumption is based upon the 
 exploded theory that there is intrinsic value in 
 gold, and denies the universally recognized fact 
 that the value of the dollar, like everything else, 
 is regulated by the law of demand and supply. 
 Therefore, it is the number of dollars or money 
 units in the monetary system that fixes the value 
 or purchasing power of each unit and constitutes 
 the standard of value. It is the demand for dol- 
 
1 06 Parity Fraud the Last Hope 
 
 lars which gives them their value, establishes 
 their equality, or, as the parrots in finance desig- 
 nate it, "parity of our dollars." To create any in- 
 equality or difference in the value or purchasing 
 power of these dollars, you would have to change 
 the number of cents in the money unit or dollar 
 itself which is an absurdity on its face. The law 
 simply says if gold is to be coined into a money 
 unit, or dollar, it shall be first weighed by the 
 lawful standard weight kept at the mint, in other 
 words, it shall not be less than 25 and 8-10 
 grains of gold to each dollar. 
 JIt is therefore plain to any one of common 
 sense that the grains of gold in this dollar is not 
 the money unit or dollar itself or in any sense a 
 standard of value for other things. 
 J In order to fully appreciate the meaning and 
 potent significance of Section 52 in this Bill, it is 
 necessary to trace the development of this so- 
 called gold standard as finally consummated in 
 the Act of March 14, 1900. 
 
 J The United States mint was established by the 
 act of Congress April 2nd, 1 792, and it provides 
 in Sec. 9 "That there shall be from time to time 
 struck and coined at the said mint, coins of gold, 
 silver and copper, of the following denomina- 
 tions, values and descriptions, viz., Eagle each 
 to be of the value of ten dollars or units, and to 
 contain 247 and 4-8 grains of pure standard gold. 
 CJ Dollars or units each to be of the value of a 
 Spanish mill dollar as the same as now current. 
 And to contain 371 grains and 4-16 parts of a 
 grain of pure silver. Half dollars, each to be of 
 half the value of the dollar or unit." 
 CJSec. 1 6. "And be it further enacted, That all 
 the gold and silver coins which shall have been 
 
Of Fooling the People 1 07 
 
 struck at, and issued from, the said mint, shall 
 be a lawful tender in all payment whatsoever." 
 tJSec. 20. "And be it further enacted, That the 
 money of account of the United States shall be 
 expressed in dollars or units, dimes or tenths, 
 cents or hundredths, and mills or thousandths. 
 A dime being the tenth part of a dollar. A cent 
 the hundredth part of a dollar. A mill the thous- 
 andth part of a dollar. And that all accounts in 
 the public offices and all proceedings in the 
 courts of the United States shall be kept and had 
 in conformity to this regulation." 
 CfThis act establishes one dollar as the legal unit 
 of value and says that when gold or silver is 
 coined into money each dollar or unit shall con- 
 'tain so many grains of gold or silver according 
 to the standard used at the mint for weighing 
 same. 
 
 tjln the very beginning of this subject should 
 be clearly borne in mind the vital difference be- 
 tween the dollar or money unit, and the metal, 
 gold or silver. 
 
 If The dollar or money unit is the creation of the 
 sovereign power of the people and binds them 
 and their property to protect its value and to re- 
 deem it at par. 
 
 J In other words, it is a legal tender for all things 
 on sale, all services for hire, and all debts, public 
 and private. This means that 94,000,000 peo- 
 ple in the United States stand ready to receive 
 it and redeem it at one hundred cents on the dol- 
 lar. In fact, its money value, which is its pur- 
 chasing and debt paying power, would be the 
 same if it did not have one grain of gold in it. 
 C|To say that the equality, validity or purchas- 
 ing power of the full legal tender dollar of the 
 
1 08 Parity Fraud the Last Hope 
 
 United States redeemable all alike in $ 1 34,000,- 
 000,000 dollars of the National wealth, includ- 
 ing all the gold and silver that we now have in 
 the United States or will ever have, and the 
 service of 94,000,000 of the most enterprising 
 and productive people in the world, depends for 
 its equality or parity upon the gold, in the dollar, 
 is an absurdity only surpassed by the miserable 
 subterfuge that $1 50,000,000 held as a reserve 
 in the United States Treasury maintains the 
 parity or equality of all our dollars. So long as 
 it is a money unit or dollar the value, purchasing 
 power, must necessarily be the same. It is 
 equivalent to saying, if these $150,000,000 set 
 aside in the Treasury were to go into circulation 
 and take the place of bank notes there would be 
 a different purchasing power in our money units 
 or dollars. 
 
 CJ (Up to this time the United States Mint was 
 a temporary institution and its life periodically 
 extended, until this act of 1873, the damnable 
 beginning of the establishment of the so-called 
 gold standard when it was made a part of this 
 scheme, a Bureau of the United States 
 Treasury. ) 
 
 fjfThis act of Congress was passed February 1 2, 
 1873, and dropped the standard silver dollar 
 from coinage, which under the act of April 2, 
 1 792, establishing the mint and coinage was 
 designated "Dollars or Units, each to be of the 
 value of the Spanish Milled (Silver Dollar) as 
 the same is now current, and to contain three 
 hundred and seventy-one grains and four six- 
 teenths parts of a grain of pure, or four hundred 
 and sixteen grains of standard Silver." The sil- 
 ver dollar was dropped from coinage in the 
 
Of Fooling the People 1 09 
 
 1 5th section of the act of February 1 2, 
 1 873 - - demonetizing silver and the gold 
 dollar substituted in section 14, "that the 
 gold dollar piece, which, at the standard 
 weight of 25 8-10 grains, shall be the unit of 
 value. An Eagle, to be of the value of ten dol- 
 lars or units. 
 
 <JSec. 52 of the Bill of the proposed National 
 Reserve Association recites "It shall be the duty 
 of the National Reserve Association to maintain 
 at all times a parity of value of its circulating 
 notes with the standard established by the first 
 section of the act of March 1 4, 1 900. This first 
 section of said act reads, "That the dollar con- 
 sisting of twenty-five and eight-tenths grains of 
 gold nine-tenths fine, as established by Section 
 3511 of the Revised Statutes of the United 
 States, shall be the standard unit of value, and 
 all forms of money issued or coined by the 
 United States shall be maintained at a parity of 
 value with this standard, and it shall be the duty 
 of the Secretary of the Treasury to maintain 
 such parity. "To state it plainly, one dollar must 
 buy as much as another dollar. Mark the refer- 
 ence," as established by Section 3511 of the Re- 
 vised Statutes of the United States." This is the 
 act of February 12, 1873, demonetizing Silver, 
 and substituting gold. Section 3511 reads, 
 "That the gold coin of the United States shall 
 be a one dollar piece, which, at the standard 
 weight of 25 8-10 grains, shall be the unit of 
 value." Is the 25 8-10 grains of gold or the dol- 
 lar the unit of value? 
 
 JA simple answer uncovers and exposes their 
 sophistry and deceit. 
 
1 1 Parity Fraud the Last Hope 
 
 CJThe unit of value had already been clearly de- 
 fined in the act of April 1 2, 1 792, which estab- 
 lished the unit and coinage law of gold and silver. 
 Section 20, "And be it further enacted that the 
 money of account of the United States shall be 
 expressed in dollars or Units, dimes or tenths, 
 cents or hundredths, part of a dollar, a mill the 
 thousandth part of a dollar, and that all ac- 
 counts in the public offices and all proceedings in 
 the courts of the United States shall be kept and 
 had in conformity to this regulation." 
 J In order to annihilate this parity fraud, which 
 has exploited the people of this country out of 
 untold millions, and is now being used by the 
 promoters of the money trust to fasten upon 
 the United States the most infamous money 
 system ever conceived to ruin this repub- 
 lic, and to expose this damnable heresy, 
 it is only necessary to ask, "What con- 
 stitutes the standard?" Is it the 258-10 
 grains of gold that constitutes the dollar, or 
 money unit, or the act of sovereignty, which 
 creates the money, and says one dollar is thej 
 unit of value? If our mints were closed to the 
 coining of gold you could weigh out 25 8-10 
 grains of gold and six months later it would not 
 be worth 50 cents; yet the purchasing power or 
 value of the dollar, or money unit, would be un- 
 changed. But, when the sovereign power of the 
 United States says, this is one dollar, the money 
 unit of the United States and pledges one hun- 
 dred and thirty-four billions of dollars of Na- 
 tional wealth and the resources of 94,000,000 
 people for its redemption at par or 100 cents in 
 the dollar, you have the best and soundest money 
 unit in the world without one grain of gold in it. 
 
Of Fooling the People 1 1 1 
 
 ^f These money schemers would make this coun- 
 try continue to believe that the 25 8-10 grains 
 of gold was the money unit and standard of value 
 in order to make permanent their banks of issue 
 with gold redemption and thereby control the 
 money system of the United States. 
 CJTo make it more explicit and so plain that no 
 man can refute it: 
 
 JThe lawful money of the United States is cre- 
 ated by the sovereign power of its people, each 
 dollar, or unit, is complete in itself, each has the 
 same value, the same purchasing and debt pay- 
 ing power, their equality or parity is neces- 
 sarily the same, as each has its redemption in all 
 the property and service of the people without 
 discrimination. 
 
 <JThe parity or equality is cemented together by 
 an unlimited and universal demand for dollars 
 because they do the work of dollars. 
 J How can there be any difference between the 
 lawful dollars of the United States, all doing the 
 same work, and having the same purchasing and 
 debt paying power? 
 
 t| The demand for the dollar of the United States 
 is the greatest ever known in the world, bringing 
 a premium over gold in Europe. 
 <J Ninety-four million people in this country 
 place an incessant and unending demand upon 
 them for their services and support. Over sixty 
 billion of debts demand them for payment. The 
 perpetual call for interest demands them with- 
 out end. Twenty-five billions of internal com- 
 merce demand their services. Europe demands 
 hundreds of millions of our dollars to settle her 
 balance of trade with the United States. 
 
1 1 2 Parity Fraud the Last Hope 
 
 t|I would ask these jugglers of words, "Is not 
 this demand sufficient to preserve the parity or 
 equality of our dollars?" 
 
 if For men of average intelligence, claiming to 
 be the representatives of the people, to deal in 
 such unmeaning nonsense and transparent 
 sophistry upon this vital question, hoping that 
 their high official positions will induce the honest 
 credulity of the people to accept it, is nothing 
 short of criminal. There is no such thing as in- 
 trinsic value of gold, and the value of gold, like 
 everything else, depends upon its quantity and 
 the demand for it, which, under economic laws 
 and conditions, should be a legitimate demand. 
 There is today nothing which is so supported in 
 its artificial and unjustifiable value as gold. 
 J There is a legitimate demand in the arts for 
 only one-third of the supply of gold. This leaves 
 an annual surplus of two-thirds, the value of 
 which, when demonetized, would shrink 50 per 
 cent of its present value. In addition to this, 
 there is an accumulated stock of over seven bil- 
 lion dollars of gold held stored away in the 
 vaults and banking institutions of the world, a 
 dead and useless economic waste and burden 
 upon the people. It is about time for the people 
 of the United States to have a lucid interval and 
 close the mints of this country, forever destroy- 
 ing the metallic basis of redemption for credit 
 money the economic curse of this republic. 
 f]j Section 52 is the most consummate fraud in 
 the Bill. It is an attempt, on the part of this in- 
 corporated money trust, to perpetuate in its own 
 interest the attempt to establish the so-called 
 gold standard in the act of February 12, 1873, 
 to which this act of March 1 4, 1 900, referred. 
 
Of Fooling the People 1 1 3 
 
 <|The authors of this National Reserve Associa- 
 tion fail to quote either the Acts of February 1 2, 
 1873, or March 14, 1900, although essentially 
 necessary to a clear understanding of this Section 
 52, but adroitly content themselves with giving 
 an absolutely misleading title to the Act of 
 March 14, 1900. 
 
 <JI desire the reader to carefully study every 
 word in this section. It first provides that the 
 notes, or promises to pay, issued by this incor- 
 porated Banking Association, shall be a first lien 
 upon its miscellaneous assets now mark you 
 "and shall be redeemed in lawful money on 
 presentation." It shall be the duty of the Na- 
 tional Reserve Association to maintain at all 
 times a parity of value of its circulating notes 
 with the standard established by the first section 
 of the Act of March 1 4, 1 900, entitled "An Act 
 to define and fix the standard of value, to main- 
 tain the parity of all forms of money issued or 
 coined by the United States." The real purpose 
 here is to permanently establish banks of issue 
 and gold redemption, subject to the endless 
 chain process to raid the Treasury with promises 
 to pay, and force the issue of bonds upon the 
 people to sustain them. 
 
 CJThe sections of the Act of February 12, 1 873, 
 and March 1 4, 1 900, repeal the law of April 2, 
 1 792, Establishing the Money System of the 
 United States, viz., "That the money of the 
 United States shall be expressed in dollars or 
 units." Therefore the sections of the Acts re- 
 ferred to really mean that one dollar shall be 
 the unit of value, nothing more and nothing less 
 (and all the rest is simply an attempt by those 
 back of John Sherman and Nelson W. Aldrich 
 
1 1 4 Parity Fraud the Last Hope 
 
 to continue the so-called Gold Standard by the 
 improper use of the word parity). Now that 
 the intrinsic value of gold will no longer serve 
 them, they have engrafted in this bill this subter- 
 fuge. I quote, "maintaining the parity of value 
 of its circulating notes with the standard estab- 
 lished by the first section of the Act of March 
 14, 1 900," which can only be done under their 
 theory of redeeming them in gold. The ab- 
 surdity of this is found in the fact that this Act 
 did not establish a money standard of any kind. 
 There is only one standard of value in a money 
 system and it is constituted by the number of dol- 
 lars in the system. The value of a dollar is made 
 by the demand for dollars, demand operating 
 against the supply. 
 
 J Hence, if the dollars are few, and the demand 
 great, the standard of their value is high and 
 their purchasing power great, and if the dollars 
 are many, and the demand small, the standard 
 of their value is low, and their purchasing power 
 small. 
 
 <|The value of a dollar or money unit is made 
 by the demand of all men for dollars, demand 
 operating against supply. 
 
 JThe equality or parity of all dollars is welded 
 together by the universal demand for dollars, as 
 universal orders for all things on sale, and the re- 
 deemers of debts. What occasion, in common 
 sense, is there for a man preferring one lawful 
 dollar of the United States to another when both 
 have the same purchasing and debt paying 
 power? 
 
 tJTo understand thoroughly a fraud, it is well to 
 trace it to its origin. This parity fraud, as applied 
 to our dollars, is found in the Act of Congress 
 
Of Fooling the People 115 
 
 July 14, 1890. This Act provides: Section 1, 
 "That the Secretary of the Treasury is hereby di- 
 rected to purchase, from time to time, silver bul- 
 lion and to issue in payment for such purchases 
 Treasury notes of the United States." 
 <J Section 2. That the Treasury notes issued in 
 accordance with the provisions of this Act shall 
 be redeemable on demand in coin at the Treas- 
 ury of the United States or at the office of any 
 assistant treasurer of the United States and, 
 when so redeemed, may be reissued, 
 ^f That, upon the demand of the holder of any of 
 the Treasury notes herein provided for, the Sec- 
 retary of the Treasury shall, under such regula- 
 tions as he may prescribe, redeem such notes in 
 gold or silver coin, at his discretion, it being the 
 established policy of the United States to main- 
 tain the two metals on a parity with each other 
 upon the present legal ratio, or such ratio as may 
 be provided by law." 
 
 CJ There is only one way known to maintain the 
 parity or equality of dollars. That is for the 
 Government to retain the option of paying out 
 either gold or silver to suit its own convenience. 
 <J France has always maintained the parity or 
 equality of her money unit, the 5-franc piece, by 
 reserving to the Bank of France the option of 
 paying out either gold or silver francs. 
 fM. Pallian, the president of the Bank of 
 France, made the following answers on this point 
 in 1 91 0: Q. "In order to discourage the exporta- 
 tion of gold does the Bank of France sometimes 
 exercise the right it possesses to refuse payment 
 in gold and offer to pay its notes in silver?" 
 J Ans. l *The Bank of France cannot, of course, 
 renounce its rights to redeem its notes in gold or 
 
1 1 6 Parity Fraud the Last Hope 
 
 silver, since gold pieces and silver coin of 5 franc 
 are equally legal tender in France. 
 CJ "In no case, however, whatever may have been 
 said, have we ever charged any premium on 
 French gold in redemption of notes." Thus the 
 parity or equity of the money in France is pro- 
 tected, it having the same purchasing and debt 
 paying power as a legal tender. And the ques- 
 tion of the parity or equality of her money is 
 never considered." 
 
 | It has been well said, "This mode of maintain- 
 ing such parity is the only mode and is as fixed 
 as the first problem in Euclid and has been longer 
 in vogue." 
 
 J There never has been an exception to it in the 
 history of the world. To maintain the parity or 
 equality of dollars in a monetary system, it is 
 only necessary for the government to preserve 
 the right or option, of the debtor to pay in either 
 or give both the full right and power of a legal 
 tender. The government representing the peo- 
 ple should issue nothing but full legal tender 
 money. 
 
 ^f All other dollars are a hybrid creation in a 
 money system, and should be eradicated. 
 JYou will notice the words used in the Act of 
 1 900 in this connection, "It being the established 
 policy of the United States to maintain the parity 
 of the metals on a parity with each other upon 
 the present legal ratio" ( 1 6 to 1 ) . 
 C| There is no mention of the parity of the Treas- 
 ury notes or dollars beyond the fact that these 
 Treasury notes shall be redeemed in coin at the 
 Treasury of the United States. Gold or Silver, 
 as to maintaining the parity of value of the 
 metals, gold and silver, upon the "present legal 
 
Of Fooling the People I 1 7 
 
 ratio," was a fraud, and intentional deception. 
 As the act itself killed the parity of value of the 
 metals by leaving the mints open to the unlimited 
 coinage of gold, which created an unlimited de- 
 mand for it at a fixed price as money, while the 
 act restricted the coinage of silver at the mints, 
 by limiting the quantity of silver to be used as 
 money, which created only a limited demand for 
 it, which absolutely destroyed the parity of its 
 value with gold, as the surplus of silver on the 
 market fixed its metal value. Hence^jhe fraud- 
 ulent use of the word parity, in reference to the 
 two metals in this Act of 1 890, is easily exposed. 
 We will now trace this parity fraud into the Act 
 of March 1 4, 1 900, which says, resurrecting the 
 old Act which demonetized silver February 1 2, 
 1873, and substituted the gold dollar designated 
 in Section 35 1 1 R. S. U. S. which says, "And all 
 forms of money issued or coined by the United 
 States shall be maintained at a parity of value 
 with this standard, and it shall be the duty of 
 the Secretary of the Treasury to maintain such 
 parity." 
 
 IJWhy insert here the words, "All forms of 
 money issued or coined by the United States?" 
 thus making the word parity apply to paper 
 when it was intended heretofore to apply to the 
 value of the metal or material out of which the 
 dollar was made. How can it properly apply to 
 the parity of value of paper and gold? Yet they 
 carry this obsolete word parity, as applied to 
 metals, to the Act of 1 890 and apply it to the 
 money unit itself, the dollar, instead of the ma- 
 terial. In this Act of 1 890, in order to destroy the 
 parity or equality of value of the Treasury notes 
 
1 1 8 Parity Fraud the Last Hope 
 
 issued, they limited their legal tender power, 
 stating, "And such Treasury notes shall be a 
 legal tender in payment of all debts, public or 
 private, except when otherwise expressly stipu- 
 lated in the contract." As most of the bonds is- 
 sued in the United States on Railroads and Cor- 
 porations amounting to billions of dollars are 
 specifically payable in gold, its full legal tender 
 value is destroyed, and there is no equality or 
 parity left in it. Then follows the paradoxical 
 absurdity "That, upon the demand of the holder 
 of any Treasury Notes herein provided for, the 
 secretary of the Treasury shall redeem such 
 notes in gold and silver coin, at his discretion, it 
 being the established policy of the United States 
 to maintain the two metals on a parity with each 
 other upon the present legal ratio as may be pro- 
 vided by law." At this time, 1 890, the parity of 
 the metals has been absolutely destroyed by de- 
 monetization of silver and its price steadily de- 
 clined from 75 cents on the dollar in 1 887 to 42 
 cents in 1 908 See Report Director of the Mint, 
 pg. 1 1 9, 1 909. This difference being so great, 
 the word parity of value of the metals gold and 
 silver became absurd, and had to be abandoned. 
 Hence the fraud, devised in the Bill reported by 
 Aldrich, entitled the National Reserve Associa- 
 tion of the United States, in which they keep 
 alive the word parity, applying it to the paper 
 credit money issued by this association of Incor- 
 porated Banks. In order to continue the fraud of 
 gold redemption and banks of issue, they have 
 the following inserted in Section 52. "It shall 
 be the duty of the National Reserve Association 
 to maintain at all times a parity of value of its 
 circulating notes with the standards established 
 
Of Fooling the People 1 1 9 
 
 by the first section of the Act of March 14, 
 1900." 
 
 (JBy injecting this word parity, this Bankers' 
 Trust asks the Congress of the United States, 
 representing the people, to allow them to have a 
 monopoly and issue their promises to pay by the 
 hundreds of millions, for the people to pay in- 
 terest on and redeem them in gold. The people 
 would prefer the Government's issuing its per- 
 fect money units, lawful, full legal tender dol- 
 lars, redeemable in $139,000,000,000^ Na- 
 tional Wealth and the services of 94,000,000 
 people. 
 
 ^f Since the words "Intrinsic value of gold" and 
 the * 'Ratio of gold and silver" can no longer be 
 used to divert and mislead the people; the ad- 
 vocates of "Banks of Issue" have made their last 
 play to protect the false basis of gold redemption 
 by the misuse of the word "Parity." I therefore 
 hope the reader will see the vital importance of 
 exposing this attempted fraud upon the people. 
 J It should be first impressed upon the mind that 
 a dollar is not a debt, but a redeemer of debt, or 
 that one dollar should not be redeemed in 
 another dollar. This idea is an invention of the 
 money lender a reversal of all sound ideas of 
 finance that ever existed. It is based upon the 
 absurdity that a dollar is a debt. 
 ^f"A dollar has never been a debt. It is not 
 made for redemption, but is made to be a re- 
 deemer." It has been well said, "If the paper 
 dollar is treated as a debt, then also the gold dol- 
 lar must be treated as a debt, else the one dollar 
 is not at a parity of function with the other dol- 
 lars, then one has a quality that the other does 
 
1 20 The Money Power 
 
 not possess, and the two dollars are not treated 
 on equal terms. 
 
 <JThen there is no sound and stable money 
 unless every unit is legally equivalent to every 
 other unit. 
 
 | A perfect money unit or dollar can be created 
 only by an act of sovereignty impressing upon it 
 the great law of a legal tender. 
 If Gold bullion, when denied the right of coinage 
 and legal tender, will be mere useless property, 
 unless used in the arts. I ask the people of the 
 United States how much longer will they allow 
 themselves to be fooled and impoverished by this 
 money power making them believe that dollars 
 are debts, redeemable and convertible into each 
 other. 
 
 J When the money power is herein spoken of, it 
 means the European monied interests as led by 
 the Bank of England, the Rothschilds and their 
 American agents, August Belmont & Co., J. P. 
 Morgan & Co., et al., and their Hebrew Asso- 
 ciates in the United States, the Clearing House 
 Association of New York, established in 1853, 
 and the American Bankers' Association, an or- 
 ganization of practically every bank of any size 
 in the United States. 
 
 <J This is the money power that controls the cir- 
 culating medium and money system of this coun- 
 try, and the business future of the American 
 people. 
 
 C[This money power dominates the United 
 States Treasury, influences the appointment of 
 its most important officials, and those who are 
 efficient rarely fail to receive more lucrative ap- 
 pointments in Banking Corporations, 
 
The Money Power 1 2 1 
 
 <} Senator John T. Morgan, of Alabama, after 
 many years of honorable service in the United 
 States Senate, made the following statement: 
 ff* 'Never in the history of any government has 
 such treatment of laws been found as in the des- 
 potism of the Secretaries of the Treasury, in 
 conjunction with the National Banks to trample 
 out every law that stood in the way of their pe- 
 culiar and pet theories, and their peculiar mo- 
 nopolistic advantage. This is a bold declara- 
 tion; I will make it good against all coders. I 
 challenge investigation of that statement upon 
 the law and practice of the Government. They 
 pay no regard to the statutes. Construction will 
 do anything with the rights of any man who will 
 submit to it. The worst tyrannies that have 
 ever been in this world were the results of false 
 construction, eating, like a cancer, from point to 
 point and step by step, sapping nerve after nerve 
 of vitality, until it finally attacks the citadel and 
 destroys the victim. Let us have the truth, the 
 honest truth. If constructions are to be made, let 
 them be made in favor of the people and not 
 against them; in favor of right and life and lib- 
 erty, and not in the direction of tyranny." 
 CJThe New York Evening Journal of Oct. 1, 
 1912, states: 
 
 | "The Treasury of the United States is run, not 
 for the farmers and the other workers that fill 
 the Treasury with gold, but for the banks and 
 the other blood-suckers that know how to get 
 what they want; that hire a Secretary of the 
 Treasury at an enormous salary at the end of his 
 term and let each succeeding Secretary know 
 that he can be rich and comfortable for life if he 
 will give the people's money to the banks to be 
 used in bleeding the people." 
 
ANGLO-AMERICAN MONEY TRUST. 
 
 T has been plainly shown that our 
 money system was derived from 
 the Bank of England scheme of 
 drawing interest from borrowers 
 by issuing to them Bank credits, 
 and by this operation charging them 
 interest on a substitute for money. This process 
 has enriched the Banking interest and the fa- 
 vored few in England, and impoverished the 
 working and producing classes of all Europe. 
 If Alexander Hamilton, in sympathy with the 
 English government, expressed himself as fol- 
 lows: "I believe the British government forms 
 the best model the world ever produced." He 
 also said: "The rich and well-born should gov- 
 
 M 
 
 ern. 
 
 CJAlso in sympathy and associated with the 
 capitalistic class of England, he co-operated 
 with England in her preconceived determination 
 to prevent the United States from establishing 
 an independent American money system. To 
 do this the money power of England used its po- 
 tential influence in every conceivable way to pre- 
 vent the people, through their government, from 
 exercising their highest act of sovereignty to 
 create and issue full legal tender money, and 
 thereby achieve their financial independence. 
 In 1 766 Lord Mansfield stated in the House of 
 Lords: "Acts of Parliament have been made not 
 only without a doubt of their legality but with 
 universal applause the great object of which has 
 
Gold Basis Banks of Issue 1 23 
 
 been ultimately to fix the trade of the colonies so 
 as to center in the bosom of that country from 
 whence they took their origin. 
 fln 1763 the British Parliament declared all 
 Colonial acts for the issue of paper currency to 
 be void. 
 
 <j[ Alexander Hamilton believed in the English 
 system of a strong centralized government and 
 a Bank of Issue. He was made the first Secretary 
 of the United States Treasury. 
 <J Recognizing the interest that England had in 
 our money system, and the influence of her 
 money lenders at this time, we can fully realize 
 the tremendous meaning and significance of 
 their maxim. 
 
 J "Let us control the money of a country and we 
 care not who makes its laws." 
 fjfThus the English system of Indirect Taxa- 
 tion, Debt-Funding Schemes, Gold Basis Banks 
 of Issue, the corner-stones upon which rest the 
 aristocracies of the old world, were transferred 
 to the United States. 
 
 CJ All these are methods through which royalty 
 legalized the robbery of the toiling millions, and 
 it makes no difference whether a king and a par- 
 liament of wealth, or a President of the United 
 States and Congress, selected by the bankers and 
 financiers, preside, the condition of the masses 
 will be the same. 
 
 CJThe first so-called United States Bank estab- 
 lished by Hamilton was simply the old Bank of 
 England scheme to exploit the people. The same 
 system was carried forward to the second so- 
 called Bank of the United States. They were 
 simply banking corporations trading under the 
 name of this great republic. Then, under the 
 
1 24 So-called National Banks 
 
 fostering care of John Sherman, of the Finance 
 committee of the Senate, it was resurrected in 
 his hydra-headed so-called National Banks of Is- 
 sue of the United States. It is proven from the 
 records of Congress and the testimony of unim- 
 peachable witnesses that the moral turpitude 
 and perfidy of John Sherman in passing laws to 
 establish the present European money system in 
 the United States have no equal in the financial 
 history of the world. 
 
 <JThe machinery of both Houses of Congress 
 was put in working order and a sufficient num- 
 ber of their members fixed to rush through in ten 
 days this banker's and money-lender's bill. While 
 the people were engaged in a great civil war this 
 financial curse was inflicted upon the United 
 States. It transferred the control of the money 
 system of the United States to banking corpora- 
 tions authorizing them to use the function of sov- 
 ereignty and issue their promises to pay, or 
 credit currency, as a substitute for real money. 
 <I As soon as this act became a law the money 
 power proceeded to build up a monopoly to con- 
 trol the money system of this country. The all- 
 powerful influence back of this act of Congress 
 forced the government to issue interest-bearing 
 securities, as a circulating medium, later to be 
 exchanged for interest-bearing United States 
 Bonds. This destroyed the circulating medium 
 of exchange, upon which all business and the de- 
 velopment of the country depended, at the very 
 time it was most needed. 
 
 if This consummate scheme worked automati- 
 cally as intended. These government securities 
 bearing interest were thereby destroyed as a per- 
 manent circulating medium, being themselves 
 
American Bankers Association 1 25 
 
 an investment for money and not being a legal 
 tender for debts. When the United States inter- 
 est-bearing bonds were later offered in exchange 
 for these interest-bearing securities, used as cur- 
 rency, the banks began to take them out of cir- 
 culation, thereby contracting the currency, de- 
 pressing the price of the bonds and buying them 
 in at the lowest possible price. It should be 
 borne in mind that, under this act, the banks 
 could deposit these bonds in the United States 
 Treasury, draw interest upon them, and issue 
 ninety per cent, of their par value in their bank 
 notes as money. It was not only a most profit- 
 able swindle of the government and people of 
 the United States but, at the same time, accom- 
 plished their fixed and far-reaching purpose of 
 issuing their notes as currency and controlling 
 the money system of the United States in their 
 own interest. 
 
 CJThe next attack is made on the non-legal 
 tender, * 'greenbacks," and silver, in order to de- 
 stroy this currency issued by the government 
 and make way for their bank notes, and still 
 further, build up their money monopoly. 
 CJThe loss, misery, and poverty inflicted on the 
 people of the United States by Specie Redemp- 
 tion, Gold Payments, and the demonetization of 
 silver, in order to accomplish this monopoly over 
 the money system of this country, have been de- 
 scribed. 
 
 <} Can any sane man fail to see the motive, pur- 
 pose and plan deliberately worked out by this 
 money power to control the money system of the 
 United States? If so, I would call his atten- 
 tion to the circular sent out by the American 
 Bankers' Association that brought on the Panic 
 
1 26 Asset Currency Bill 
 
 of 1893, and the influence, brought to bear to 
 stop the government from issuing any more U. S. 
 Treasury notes, then the act of Congress, es- 
 tablishing the so-called Gold Standard in 1 900, 
 which they, no doubt, thought perpetuated 
 banks of issue as the permanent money system of 
 the United States. The only obstacle they now 
 wish to remove is the limitation put upon their 
 bank-note circulation by restricting the issue of 
 their notes to Government Bonds. They realize 
 if the government pays these bonds it cuts from 
 under them the very foundation of their exist- 
 ence. In recent years they have forced additional 
 bond issues as a means of preservation. This 
 being the case, and realizing that the people 
 would not stand for bond issues of any size in 
 time of peace, they therefore brought forward 
 their carefully laid plan of substituting their mis- 
 cellaneous securities as a basis for issuing bank 
 notes in place of Government Bonds. After the 
 American Bankers' Association held meetings, 
 covering the period of several years, considering 
 the matter, they presented their conclusions and 
 what they wanted in a currency plan, de- 
 scribed as an Asset Currency Bill. This 
 would enable them to draw interest from 
 the people on the asets of the bank while 
 held as security by the United States 
 Treasury that would authorize them to issue 
 their bank notes as money to be loaned to 
 the people. Being unable to get favorable action 
 from Congress on this bill in 1 906, they waited 
 until 1907, when another bill of the same kind 
 was presented by Senator Aldrich after many 
 conferences with J. P. Morgan & Co., et al. This 
 was also an Asset Currency Bill and, among 
 
Aldrich-Vreeland Emergency Law 127 
 
 other things, provided that railroad bonds should 
 be accepted as the basis of national bank note 
 issues. J. P. Morgan, the great manufacturer of 
 debts on the railroads of this country, was pres- 
 ent in the gallery of the United States Senate 
 when Nelson W. Aldrich, Chairman of the Fi- 
 nance Committee, advocated the passage of this 
 Bill. 
 
 <|This Bill was violently opposed by the leader 
 of the Republican Progressives in the Senate, 
 and Aldrich, seeing it would be defeated, re- 
 sorted to an infamous legislative trick worthy of 
 John Sherman. With the co-operation of Vree- 
 land, of the House, this measure was put through 
 both Houses of Congress in the last two days of 
 the session. The Aldrich-Vreeland Emergency 
 Currency Law, which creates National Banks of 
 Issue in blocks of ten, and gives them authority 
 to issue their notes on the assets of the banks 
 from bonds down to one name paper, accord- 
 ing to the ruling of the Secretary of the Treas- 
 ury. This law should be watched by the people, 
 for a simple amendment, extending its time and 
 relieving the notes issued thereunder from the 
 emergency tax, would practically take the place 
 of the Money Trust Bill now pending in 
 Congress. 
 
 |The law reads "That this act shall expire by 
 limitation on the thirtieth day of June, 1914." 
 <|This act puts the banks in a position to get 
 $500,000,000 from the United States Treasury 
 in an emergency, and does not provide that the 
 borrower can get one dollar. It is shown that the 
 banks can create the emergency whenever they 
 want it. 
 
1 28 A Money Trust Bill 
 
 banks are put in a panic-proof condition 
 and the people left defenseless. 
 tJThe money power framed this law and ap- 
 pointed "The National Monetary Commission" 
 that have favorably reported to Congress a Bill 
 which should be correctly described as "The 
 Anglo-American Money Trust Combination." 
 flt is masquerading under the misleading title 
 of the "Reserve Association of the United 
 States," and is now pending in Congress. What 
 do we find as a result of the operation of this 
 Bank of England money scheme transplanted in 
 the United States? 
 
 J It forced upon the tax-payers of this country, 
 absolutely without justification, over $2,000,- 
 000,000 of bonds, principally for the benefit of 
 European bond dealers and American Bankers. 
 CJThis has cost the people of the United States, 
 in hard-earned cash, over $3,500,000,000, in- 
 cluding interest. It has been the direct cause of 
 four disastrous panics, each inflicting upon the 
 people the loss of untold millions. It has en- 
 abled International and American Bankers and 
 Bond and Stock Jobbers to manufacture $70,- 
 000,000,000 of paper tokens of wealth upon the 
 industrial and manufacturing resources of the 
 United States, that they propose to make the 
 people take care of by paying the interest and 
 dividends. 
 
 <|It has impoverished and made debtors of 
 about 90 per cent of the people. It has filled the 
 large cities with non-producers, gamblers and 
 parasites. It has lowered our moral standard 
 and destroyed the reputation and character of 
 American Manhood. 
 
LOANING OF BANK CREDITS AND USE 
 
 OF CLEARING HOUSE CERTIFICATES 
 
 AS A SUBSTITUTE FOR MONEY, 
 
 HE result of all this legislation in the 
 interest of banks has reduced the 
 supply of real money to such a small 
 stock, and most of it out of circula- 
 tion and held and controlled by the 
 banking institutions that we could 
 not do business a single day if the banks did not 
 add to the money stock by every ingenuity, trick 
 and device whereby the banker is enabled to 
 keep every actual dollar drawing interest in sev- 
 eral places at the same time. By this process the 
 banks, to all practical purposes, are counterfeit- 
 ing money, by lending what is called the banks' 
 credit as a substitute for money. The counter- 
 feiter gives no valuable consideration for the 
 money he circulates. The banker gives no val- 
 uable consideration for this credit he furnishes 
 the borrower; yet the borrower has to pay dol- 
 lars for that which cost the banker nothing. By 
 the use of these credit devices and the working 
 of the "Clearing House System among Banks" 
 the transactions that involve the handling of cash 
 are relatively small. 
 
 <JA practical illustration will make plain the 
 operation. The owner of stocks, bonds or any 
 kind of security borrows $5,000 from a bank 
 and leaves his security with the bank. The bank 
 draws interest on the $5,000 without the 
 
130 Bank Credits and Clearing House 
 
 borrower ever seeing any kind of a dollar. He 
 simply receives authority to draw upon the 
 bank's credit to the extent of $5,000, which he 
 may do in checks in payment for property or 
 more stocks and bonds. 
 
 <|The bank generally pays these checks by mak- 
 ing a few figures in its books deducting from 
 the credit of the borrower and adding to the 
 credit of those who present the checks. 
 j[ Yet the bonds or security left by the borrower 
 have become an asset of the bank, and the bank 
 proceeds to lend another borrower $5,000 upon 
 the basis of the first borrower's bonds or 
 security. 
 
 <JBy this operation a small amount of actual 
 cash may be pyramided into a great many loans 
 drawing interest upon the same small amount of 
 cash. 
 
 <JThe same applies to National Bank Notes. 
 J A million dollars of them invested in Govern- 
 ment bonds used as a basis of bank circulation 
 draw interest from the Government and from 
 other borrowers at the same time. 
 <J Thus for interest-drawing purposes the million 
 dollars is not one million dollars, but may be ten 
 or fifteen million. 
 
 tj It may occur to the mind of the reader that a 
 borrower does not always leave the amount 
 placed to his credit with the bank, but would 
 withdraw it and put it in another bank to his 
 credit. This is rarely done, as the rules of most 
 banks is to discount only for their depositors or 
 to open an account with the borrower. Yet if 
 the cash was withdrawn and put in another bank 
 it would make but little difference in the aver- 
 aging up between the banks by the invention of 
 
Substitutes for Money 1 3 1 
 
 the Banker's Friend, the ''Clearing House Asso- 
 ciation," that most wonderful invention of the 
 banking mind, to economize cash inflate bank 
 credits, as a substitute, thus drawing interest on 
 dollars that do not exist, thus manufacturing in- 
 terest-bearing debts on the people. 
 
 To show the marvelous workings of this 
 Clearing House Association machinery not 
 patented, not incorporated, entirely outside of 
 the law, never contemplated as a part of our 
 money system, its proceedings not subject to 
 judicial review. In 1911 the 140 Clearing 
 House Associations' transactions amounted to 
 $92,420, 1 20,092. In short, this Bankers' Inven- 
 tion or Scheme enabled the Banks in the United 
 States, by having their checks exchanged and 
 cancelled, thereby reducing the amount of cash 
 used to the basis of paying in money only $4.78 
 on $ 1 00,000 of checks on the bank. 
 fj The whole system enabled the banks to inflate 
 the currency system by loaning their credit as a 
 substitute for money, making every actual dollar 
 the basis of earning interest on five times the 
 amount, thereby pyramiding debts on a narrow 
 real money basis. The inevitable result in any 
 attempt to collect these debts is a panic. I desire 
 to call attention to the advantage that the bank 
 has over the borrower and the public generally 
 in this transaction. The bank loans the borrow- 
 er its credit, a thing of no material value, yet the 
 borrower has to pay off this credit with actual 
 money. 
 
 fJThis makes it an unjustifiable exaction against 
 the borrower that should not be allowed in itself, 
 and for another serious reason that it affects 
 most injuriously the general public, for the rea- 
 
1 32 An Elastic Currency 
 
 son that when the banks desire to increase their 
 money reserves, or cash holdings, they call for 
 cash payments of these inflated bank credits 
 when it is most difficult for the borrower to get 
 hold of money; the result being he has to sacri- 
 fice his property in a contracted money market 
 at less than its true value, and, if the banks 
 become apprehensive as a result of a falling mar- 
 ket, caused by their own action, and make addi- 
 tional demands upon their borrowers for money 
 and curtail their discounts, a depression, or 
 panic, is the result, which becomes a harvest to 
 the bankers, for, having the use of money, they 
 can buy the best securities forced on the market 
 for a mere song, and sell them, when prosperity 
 returns, at the top of the market. It is here 
 clearly shown that it is the inflation and sale of 
 these bank credits that cause panics, and the 
 great losses and suffering inflicted upon the 
 people thereby. 
 
 CJThis plan was put in operation by the banks 
 through the circular issued by the American 
 Banking Association directing them to call in 
 half their loans and retire one-third of their bank 
 note circulation. The panic of 1 893 was the 
 direct result of this action of the banks, by a 
 well-thought-out and deliberate scheme to 
 destroy the business and property of the people. 
 The panic of 1 893 was one of the worst in point 
 of loss and duration ever known in this country. 
 CJThe same acts will cause a panic any day in 
 the year. Yet what is everybody's business 
 seems to be nobody's business and these banks 
 hold the lives, happiness and prosperity of the 
 people entirely in their control. 
 
Or India Rubber Money 1 33 
 
 Sit is conclusively shown in this pamphlet that 
 e object sought by the banking interests was to 
 reduce the supply of real money issued by the 
 Government to the minimum, so that the people, 
 in order to do business, would have to use bank 
 credits as a substitute for money. Thus a loan 
 to the borrower may have no real money back of 
 it. Simply a bank credit, but it at once becomes 
 a money demand against the borrower, and 
 every loan collected by the bank withdraws from 
 circulation so much money. This deliberate 
 plan to exploit the people has been systematic- 
 ally worked out by those who have established 
 the present banking system whereby the people 
 have been put absolutely at their mercy. Under 
 the operation of their well-perfected plan, it is 
 only necessary for the banks to call in a small 
 percentage of their loans amounting to the fab- 
 ulous sum of $1 3,046,000,000 and withdraw at 
 the same time one-third of their india-rubber 
 banknote circulation, amounting to $711 ,099,- 
 938, and it would produce a panic and contrac- 
 tion of the currency sufficient to destroy business 
 prosperity of the country, relegate millions of 
 people into enforced idleness and create wide- 
 spread ruin and poverty. It should be borne in 
 mind by the people that the large bank- 
 ing institutions have protected themselves 
 against losses from these artificial panics, 
 all of which are the result of the vicious 
 system they have put into operation, as 
 they are enabled to take advantage of 
 panics with tremendous profit to themselves. It 
 will be seen that, while the people are left in a 
 defenseless position, being unable to get hold of 
 money or discount their paper at the bank, the 
 
\ 34 Withdrawn When Most Needed 
 
 banks, through the operation of the Clearing 
 House Association, find absolute protection, as 
 the organization constructed by themselves, 
 entirely for their own benefit, in plain violation 
 of the law, usurping the function of the highest 
 act of sovereignty, issuing that which is prac- 
 tically money in their Clearing House certifi- 
 cates. I would ask the people to realize that, 
 when they are unable to get hold of money or 
 any substitute to protect themselves against 
 ruin, this central power of the banks gives them 
 the use of a far more potent substitute, for they 
 can use these Clearing House certificates to settle 
 their net balances at the Clearing House, where 
 $4.78 takes care of $100,000 of checks drawn 
 by the people on the banks. In the panic of 1 907 
 the New York Clearing House alone issued 
 $101,000,000 of these Clearing House certifi- 
 cates for the use and protection of the New York 
 banks, for the use of which the banks only put 
 up miscellaneous securities. 
 
THE AMERICAN BANKERS ASSOCIA- 
 TION. 
 
 Panic Circular. 
 
 N order to show that the people were 
 deceived in the Presidential Cam- 
 paign of 1892 and that the money 
 power was the controlling force 
 back of this campaign and that their 
 purpose was to stop the Govern- 
 ment from adding to the currency system by the 
 coining, or use of any more silver as currency, 
 and by doing this increase the hold of the money 
 power and banking interest over the money sys- 
 tem of the United States, in the Campaign of 
 1 892 the people were kept excited and their at- 
 tention centered on the Tariff, the Nominal Issue, 
 while the real issue was being kept from them. 
 They talked Tariff while the real issue was 
 money. A valuable witness is at hand from the 
 inner money circle to prove that this was the case 
 in 1 902. Mr. Solomon, a partner of Speyer & 
 Co., International Bankers, made the following 
 statement in the "Forum" for July, 1895, en- 
 titled * 'Sound Currency and the Dominant 
 Issue." 
 
 It was well understood that a reform of the 
 tariff was to be the nominal issue of the cam- 
 paign of 1892, and that all the changes were 
 to be rung upon that theme, but enthusiasm 
 for a reform of the tariff would not have pro- 
 duced for the anti-snapper movement the 
 
136 Panic Circular, 1893 
 
 sinews of war. What did produce them was 
 the conviction that the triumph of the Demo- 
 cratic party, with Mr. Cleveland at its head, 
 would mean a repeal of the purchasing clause 
 of the Sherman Act. A large number of the 
 men who joined actively in the work of or- 
 ganization, though also tariff reformers, could 
 not have afforded to make the numerous self- 
 sacrifices necessary to taking an active part in 
 a canvass on any but such a vital issue as that 
 of the maintenance of the integrity of the cur- 
 rency. 
 
 J This article was written by Mr. Solomon, who 
 was in a position to know the facts, and he put 
 himself on record as above, three years after the 
 people thought they had elected Cleveland upon 
 the Tariff Issue. In this connection, I desire to 
 call the attention of the people of this country 
 to what is known as the American Bankers' 
 Association. This Asociation is made up of 
 local clearing house associations numbering 1 40, 
 throughout the United States. In other words, 
 the American Bankers' Association is a com- 
 bination of the various Local Clearing House 
 Associations throughout the United States, com- 
 posed of the individual banks in the different 
 communities throughout the United States. 
 t|The Clearing House Associations are auto- 
 cratic bodies organized upon the plan of the 
 Clearing House Association of New York, 
 which, in fact, is the parent organization, was 
 formed in 1853, and is one of the im- 
 portant factors of the money power. It is a 
 voluntary organization, has no charter from 
 the state, is not amenable to legislative or 
 
American Bankers Association 137 
 
 judicial control. It absolutely controls its 
 membership, which at present embraces every 
 large bank and trust company in the City 
 of New York. After a Bank has once become a 
 member of any of these "Clearing House Asso- 
 ciations" and uses its machinery to clear for 
 them, the fate of such a bank is absolutely at the 
 mercy of the Association, for the reason that, if 
 the Association declines or stops clearing for 
 them, a run is immediately made upon the bank 
 and it has to close its doors. Bearing in mind the 
 power of the American Bankers Association, 
 which through its Clearing House Association 
 membership reaches every Bank of any im- 
 portance in the United States, it is obvious that 
 none of them would be willing to antagonize its 
 influence and power. 
 
 flit is important to bear in mind that, at the 
 time of Cleveland's Inauguration, business con- 
 ditions throughout the United States were in a 
 prosperous state, crops were good and the mer- 
 cantile agencies reported conditions 'Very satis- 
 factory and unusually strong." At this time the 
 Government was purchasing and putting into 
 circulation 4,500,000 ounces of silver a month, 
 represented by United States silver certificates. 
 This the Banks determined to stop, and, as soon 
 as Cleveland had taken the oath of office as 
 President of the United States, the "American 
 Bankers Association," realizing that there was a 
 large majority in Congress against the repeal of 
 this act whereby the Government was issuing 
 additional currency, determined to force its 
 repeal by creating a panic in order to do so. Just 
 twelve days after Cleveland was sworn into 
 office, on March 12, 1893, the American Bank- 
 
138 Panic of 1893 
 
 ers Association, representing the Incorporated 
 National Banks of the United States, through 
 their all-powerful influence and control of the 
 currency of this country, deliberately planned to 
 destroy the prosperity and business welfare of 
 over 80,000,000 people in order to increase their 
 stranglehold on the Monetary System of the 
 United States, their plan being to drive the 
 people into misery and poverty, hiding their in- 
 tentions by loudly proclaiming that it was due to 
 the Government adding to the currency by is- 
 suing silver certificates, charging that the panic 
 was brought on by the Government using silver 
 bullion and issuing silver certificates to increase 
 the currency. Fortunately, the Panic Circular 
 sent out on the 1 2th of March, 1 893, by this or- 
 ganization, the American Bankers Association, 
 is at hand and can be correctly designated as 
 the panic circular of the organized money power 
 of the United States, as it was the immediate 
 and only cause of the panic of 1 893. It reads as 
 follows: 
 
 Dear Sir: The interests of national bank- 
 ers require immediate financial legislation by 
 . Congress. Silver, silver certificates and treas- 
 ury notes must be retired and the national 
 bank notes, upon a gold basis, made the only 
 money. This requires the authorization of 
 $500,000,000 to $1,000,000,000 of new 
 bonds as a basis of circulation. You will at 
 once retire one-third of your circulation and 
 call in one-half of your loans. Be careful to 
 make a money stringency felt among your 
 patrons, especially among influential business 
 men. Advocate an extra session of Congress 
 
American Bankers Association 1 39 
 
 for the repeal of the purchase clause of the 
 Sherman law; and act with other banks of 
 your city in securing a large petition to Con- 
 gress for its unconditional repeal, as per ac- 
 companying form. Use personal influence 
 with congressmen; and particularly, let your 
 wishes be known to your senators. The 
 future life of national banks as fixed and safe 
 investments depends upon immediate action, 
 as there is an increasing sentiment in favor of 
 governmental legal tender notes and silver 
 coinage. 
 
 CJThe testimony of Cleveland verifies the condi- 
 tion of prosperity at this time. 
 
 Our unfortunate financial plight is not the 
 result of untoward events, or of conditions 
 related to our national resources; nor is it 
 traceable to any of the afflictions which fre- 
 quently check national growth and pros- 
 perity. With plenteous crops, with abundant 
 promise of remunerative production and man- 
 ufacture, with unusual invitation to safe in- 
 vestment, and with satisfactory assurance of 
 business enterprise, suddenly financial dis- 
 trust and fear have sprung up on every side. 
 
 CJThat of Senator Hill of New York as to the 
 action of the Bankers in following the directions 
 given them by the American Bankers Associa- 
 tion. 
 
 | Senator Hill, in a speech in the Senate, on 
 August 25, 1893, said: 
 
 They (the bankers) inaugurated the policy 
 of refusing loans to the people, even upon the 
 best of security, and attempted in every way 
 
140 Panic of 1893 
 
 to spread disaster throughout the land. These 
 disturbers these promoters of the public 
 peril represent largely the creditor class, the 
 men who desire to appreciate the gold dollar 
 in order to subserve their own selfish interests ; 
 men who revel in hard times; men who drive 
 harsh bargains with their fellow-men regard- 
 less of financial distress, and men wholly un- 
 familiar with the principles of monetary 
 science. 
 
 Carlisle Decision Turned Dollars into Debts. 
 
 <|From 1 862 to 1 893 the control of the govern- 
 ment was in the hands of the Republican party. 
 During all this time all legislation on money had 
 been dominated by the banking interest, but at 
 this time the money interest realized that there 
 was a large majority in Congress which was 
 opposed to discontinuing entirely the further use 
 of silver, by the government, as money; so they 
 determined to make the Democratic party their 
 scapegoat and tool in order to put over the next 
 financial conspiracy upon the people of the 
 United States and still further strengthen the 
 hold and control of banks of issue over the cir- 
 culating medium of the country. There never 
 was a more comprehensive plan put in operation 
 by the banking associations to coerce Congress 
 to pass this bill. The writer was in contact with 
 senators and the representatives of the people in 
 Washington; appeals were being made to them 
 from their constituents all over the United States 
 to withdraw their objections to the passage of 
 this bill, as their banks had notified them that 
 they could not give them banking accommoda- 
 
Dollars Turned into Debts 141 
 
 tions unless this bill was passed. So great was 
 the pressure upon a certain senator whom I knew 
 intimately, and who so clearly understood the 
 fraud that was about to be perpetrated upon the 
 people, that he said: "It was the greatest trial of 
 my life to refuse to comply with their request, 
 yet I would have lost my self -respect and would 
 have surrendered my honest convictions upon a 
 question I knew would be of greatest injury to 
 the people." Holding these convictions, he 
 tendered his resignation to the legislature of his 
 state, which was declined. 
 
 If In this fight for the unconditional repeal of the 
 silver act the organized banking interests made a 
 direct attack on the silver and silver certificates 
 in order to discredit them, the object of the bank- 
 ers being to stop any further addition of money 
 issued by the government in order that banks of 
 issue might substitute their notes and strengthen 
 their monoply over the money system of the 
 United States. Space will not permit me to de- 
 scribe the loss and suffering brought upon the 
 people, which covered a period of about six 
 years. 
 
 | I will now come to the next step taken by this 
 association of the banking interests to absolutely 
 discredit and convert into debts, $350,000,000 
 of money, that had already been issued by the 
 government. In order to do this I would call 
 attention to the law of 1890, which provides, 
 Section 1 , "That the Secretary of the Treasury 
 is hereby directed to purchase, from time to time, 
 silver bullion to the aggregate amount of 4,500,- 
 000 ounces, at the market price thereof * * * 
 and to issue, in payment for such purchases of 
 silver bullion, Treasury notes of the United 
 States." 
 
1 42 To Establish Gold Standard Fraud 
 
 <J Section 2. "That the Treasury notes issued in 
 accordance with the provisions of this act shall 
 be redeemable on demand, in coin, at the Treas- 
 ury of the United States, and when so redeemed 
 may be reissued." 
 
 CJ After forcing through Congress the act stop- 
 ping the coinage of silver, they put into oper- 
 ation what has been aptly termed "the endless 
 chain process." 
 
 if John G. Carlisle, who had been speaker of the 
 House of Representatives and a life-long op- 
 ponent of the so-called gold standard, had stated 
 (I quote him) : '* According to my views of the 
 subject, the conspiracy which seems to have 
 been formed here and in Europe to destroy by 
 legislation and otherwise from three-sevenths to 
 one-half the metallic money of the world is the 
 most gigantic crime of this or any other age. 
 The consummation of such a scheme would ulti- 
 mately entail more misery upon the human race 
 than all the wars, pestilences and famines that 
 ever occurred in the history of the world." 
 <J Cleveland appointed Carlisle Secretary of the 
 Treasury, and the administration, through in- 
 fluence brought to bear by the money interest, 
 determined to increase the public debt by the 
 issue of bonds, and simultaneously to discredit 
 and turn into debts $350,000,000 of United 
 States Treasury notes and silver certificates, and 
 use them to force a bond issue for the benefit of 
 the banks as a basis for the increased issue of 
 national bank notes. The writer has in his pos- 
 session conclusive evidence of the following 
 statement: Although the law provided that 
 Treasury notes should be redeemed in coin at 
 the discretion of the Secretary of the Treasury, 
 
Dollars Turned into Debts 1 43 
 
 the whole object of the law being that the Secre- 
 tary should use the option in the interest of the 
 people and redeem the Treasury notes in either 
 gold or silver, using that which was most con- 
 venient at the time, the Bank of France with- 
 out exception has so exercised this option. Pres- 
 ident Cleveland used his influence over Carlisle 
 to get him to construe the law so that he should 
 redeem these United States Treasury notes 
 in gold. Carlisle was an able lawyer and 
 familiar with all the statutes bearing on the 
 subject of money, was also aware of the 
 motives of those who were demanding such an 
 illegal construction of this law; he was so much 
 exercised and concerned in the importance of 
 such action that he requested two United States 
 Senators, his closest friends, to confer with him. 
 One was Senator Blackburn of Kentucky, the 
 other Senator Daniel of Virginia. The confer- 
 ence was held at Secretary Carlisle's K Street 
 residence, he having an appointment to see Pres- 
 ident Cleveland at the White House that night. 
 These two senators urged Carlisle to adhere to 
 the law that plainly stated that the Treasury 
 notes issued in payment for silver bullion should 
 be redeemed in coin, either silver or gold, at the 
 option of the Secretary of the Treasury, and that 
 for him to do otherwise would leave the United 
 States Treasury, the fiduciary department in- 
 trusted with the people's money, at the mercy of 
 the moneyed interest. Carlisle left the house 
 saying that he would not relinquish the option 
 to redeem these Treasury notes as provided in 
 the law and allow the holder of these notes to 
 demand gold in payment for them, which would 
 leave the Treasury of the United States in an 
 
1 44 To Establish Gold Standard Fraud 
 
 absolutely defenseless condition, and enable the 
 holder of these notes to raid the gold reserve of 
 the Treasury. Senators Blackburn and Daniel 
 waited for him to return from his interview with 
 Cleveland at the White House. He had evident- 
 ly had a long and trying conference, and it was 
 midnight before he returned. He met his friends, 
 evidencing the greatest humiliation, and said 
 that Cleveland had induced him against his own 
 convictions to redeem these Treasury notes in 
 gold. Carlisle looked as if he had sold his birth- 
 right. 
 
 fJThe unthinking cannot realize the far-reach- 
 ing significance of this decision. It was the first 
 time in the history of the money of the world 
 that a dollar was decided to be a debt redeem- 
 able in another dollar. The direct result was 
 the conversion of 350,000,000 Treasury notes, 
 or dollars, into debts redeemable in gold. 
 It opened the door of the United States Treasury 
 to the planned attack on its gold reserve and 
 forced an issue of 262,000,000 of bonds on the 
 taxpayers in a time of profound peace. I would 
 impress upon the voters of this country the vital 
 importance to them of this action, as it is the 
 absolutely false and indefensible premise upon 
 which the banking interest of this country pro- 
 poses to build their so-called National Reserve 
 Association of the United States, viz., the base- 
 less and fraudulent assumption that it is neces- 
 sary, in order to maintain the equality, or, as they 
 term it, the parity of our dollars, that we should 
 construe all other dollars in our currency system 
 to be debts redeemable in gold, and, in order to 
 deceive the people, they have created a gold re- 
 serve of $ 1 50,000,000 in the Treasury to be used 
 
Dollars Turned into Debts 1 45 
 
 in maintaining, as they claim, the equality or 
 parity of our dollars. 
 
 CJ Is there a sane, honest man who will contend 
 for one moment that the integrity of our cur- 
 rency system and the equality, parity or pur- 
 chasing power of the American dollar are main- 
 tained in their value by $150,0^0,000 of gold 
 (ostensibly held as a reserve, yet which can be 
 raided and withdrawn by the money interest at 
 any time), and not by the $1 34,000,000,000 of 
 national wealth and the services of 94,000,000 
 people in the United States pledged for its re- 
 demption. 
 
PANIC OF 1907. 
 
 ARLY in 1907 John D. Rockefeller 
 predicted the "Panic of 1 907," and 
 other Wall Street financiers made 
 the same statement, a little later. 
 Why did these men know that a 
 panic was coming? There were no 
 visible signs in the natural or industrial condi- 
 tions of the country to indicate it. Large crops 
 and great business actually obtained throughout 
 the country. The president of the great labor 
 organizations stated before the Banking and 
 Currency Committee of Congress that just 
 before this panic came labor was universally 
 employed, and at better wages than ever before, 
 and that many were adding to the real comforts 
 of life, when, without sign or warning, this panic 
 came upon them, and that at the time he spoke 
 two million workingmen were idle, as the direct 
 result of this Money-Panic, and in want of the 
 necessities of life. The answer is easily given; 
 these men knew a panic was coming, for the rea- 
 son that they had the means within their control 
 to create it and had determined to bring it upon 
 the country with the most profitable results to 
 themselves. In addition to the losses sustained 
 by the general public, which they took advantage 
 of, they garnered in the coveted securities of 
 their competitors at bargain prices. The follow- 
 ing are conspicuous examples: 
 <JF. Augustus Heinze, the competitor of the 
 Standard Oil Amalgamated Copper Company, 
 was eliminated. Charles W. Morse, the com- 
 petitor of J. P. Morgan & Co. in his merger of 
 
Panic of 1907 147 
 
 the Atlantic Coastwise Steamer Lines, was also 
 eliminated. 
 
 CJ Tennessee Coal and Iron, the competitor of J. 
 P. Morgan & Co.'s billion-and-a-half dollar 
 U. S. Steel Trust, was eliminated. How was it 
 done? 
 
 If Heinze and Morse were destroyed as competi- 
 tors by the wrecking of what was known as the 
 Heinze and the Morse banks the first victim 
 being the Knickerbocker Trust Company, which 
 later proved to be thoroughly solvent. 
 f Tennessee Coal and Iron was destroyed as a 
 competitor by the all-powerful banks in New 
 York promptly refusing to continue loans, in the 
 midst of the panic, unless the bonds of the U. S. 
 Steel Trust were substituted for the securities of 
 the Tennessee Coal & Iron Company held by 
 them as collateral. 
 
 If This is the most astounding financial transac- 
 tion on record of high finance. This transaction 
 was put over the President of the United States, 
 and not one dollar changed hands. The great 
 and only competitor of the Steel Trust was ab- 
 sorbed and paid for with the securities issued by 
 the Steel Trust and not one dollar of money 
 put in the banks to 'check the panic. 
 <JAs there was nothing in the physical condi- 
 tions of the country to cause a panic at this time, 
 and, as we know, the dominating money in- 
 terests in New York, the principals in this con- 
 spiracy, can bring on a money panic of this kind 
 at any time, it is only necessary to apply the ordi- 
 nary laws of evidence as applied to conspiracies 
 and look for the motive, and then proceed to find 
 the criminal. In this panic the motive is plain, 
 and, as conclusive evidence of guilt, we find the 
 goods in the possession of the criminals. 
 
RESPONSIBILITY RESTS WITH THE 
 
 PEOPLE. 
 
 IOTHING will ruin the country," said 
 Webster, "if the people themselves 
 will undertake its safety: nothing 
 can save it, if they leave that safety 
 in any hands but their own." 
 J After having given the history of 
 money the most careful study as an economic 
 question, and familiarized myself with all the 
 laws enacted by Congress upon the subject of 
 money, currency, and National banks, and hav- 
 ing had the opportunity to study at close range 
 the representatives of the people in Congress 
 here in Washington for the last thirty years, and 
 owing to the present vital importance of the 
 money question now as an issue before the 
 voters, I deem it nothing more than my duty to 
 state to them that a large majority of their repre- 
 sentatives in Congress are moral cowards on this 
 subject, and the people, in justice to themselves, 
 can no longer leave this all-important subject to 
 their representatives. 
 
 As the last remarkable evidence of such action 
 by the representatives of the people in Congress, 
 I would call attention to the fact that, after hav- 
 ing appropriated over $300,000 of money of the 
 taxpayers, which was spent by the National 
 Monetary Commission to investigate the 
 monetary and banking systems of the world, a 
 Bill was subsequently presented in Congress to 
 "investigate the money trust" in the United 
 
Watch Your Representative 1 49 
 
 States, the controlling majority in the House of 
 Representatives held a caucus on this bill and de- 
 feated it by a large vote. It is true when they 
 heard the result of this action and that it was a 
 political mistake that jeopardized them individ- 
 ually, they moved for a reconsideration and 
 passed the Bill and appointed members of the 
 Banking and Currency Commission whose en- 
 vironment was that of the moneyed interest, to 
 do the investigating. The banks refused to ac- 
 knowledge the power of Congress to have this 
 Committee investigate them. A Bill was passed 
 by the House May 26, 1912, and the Senate was 
 asked to concur in granting additional power to 
 examine the banks in order that the Committee 
 might continue the investigation. 
 Cf The bill was referred to the finance committee 
 of the Senate, after suppressing it for several 
 months. This committee made an adverse re- 
 port, practically saying that the banks should not 
 be investigated. This conclusively demon- 
 strated that the most important committee in 
 Congress is still dominated by the money power, 
 previously represented by John Sherman and 
 Nelson W. Aldrich, as chairmen of the Finance 
 Committees of the Senate. 
 
 fj Boies Penrose, the boodler of Pennsylvania, is 
 now the chairman of this finance committee of 
 the Senate and at the same time has both feet in 
 the trough of the Standard Oil Company at 
 Broadway, New York. 
 
 ffOf such are the tools of the builders of Na- 
 tional Banks of Issue and the Money Trust of the 
 United States. 
 
 IJ Nelson W. Aldrich was a Senator and also 
 chairman of the Finance Committee, drawing 
 
1 50 Vote on Money 
 
 
 
 his salary from the taxpayers of the country, and 
 retired a multi-millionaire. He is an understudy 
 of John Sherman. 
 
 JIn 1854 John Sherman entered Congress a 
 poor man, and, when subsequently made Chair- 
 man of the Finance Committee of the Senate, 
 betrayed his own people into the hands of for- 
 eign bankers and their agents and correspond- 
 ents in the United States. While in the Senate 
 he drew his salary of $6,000 a year from the 
 taxpayers of the country, lived in luxury, and 
 retired worth over $3,000,000. 
 CJ The Senate, although having ample time after 
 the Finance Committee made its report, ad- 
 journed without passing this bill. The result 
 shows that although they could appoint a Na- 
 tional Monetary Commission in the interest of 
 banks, and authorize the expenditure of over 
 $300,000 of the taxpayers' money, to investigate 
 foreign banking systems, which resulted in their 
 recommending the present money trust bill now 
 pending in Congress, and pass another bill en- 
 dorsing the investigation of the rural credit sys- 
 tem of banking in foreign countries, where the 
 people have been reduced to hopeless poverty, 
 there was not enough manhood or moral courage 
 in the United States Senate to pass a bill that had 
 been forced through the House of Representa- 
 tives "to investigate the Money Trust" in the 
 United States, in order that the people might 
 escape from its oppressions. 
 <J I urge upon all voters to apply this crucial test 
 to their representatives before supporting them. 
 CJMake them commit themselves squarely and 
 unequivocally to these questions. Do you be- 
 lieve Congress should exercise its sovereign 
 
Who Is the Moral Coward? 1 5 1 
 
 power as provided in the Constitution of the 
 United States to create money and regulate the 
 value thereof and control the circulating medium 
 in the interest of the whole people? Or do you 
 believe this sovereign power should be trans- 
 ferred to Banks of Issue? 
 
 IJ Their answers will prove conclusively whether 
 they are with the people or against them. 
 CJ Or do you believe that Banking Corporations 
 should issue a credit substitute and through it 
 control the money and circulating medium of 
 exchange of the people of the United States in 
 their own interest? 
 
 } Watch your presidential candidate carefully 
 and see that he commits himself clearly on this 
 vital question. It will be a true test of his hon- 
 esty and fitness for the office. Admitted igno- 
 rance on the money question should not excuse 
 him. The subject is as old as our Government, 
 and if he does not know enough about it now to 
 answer these test questions, he is not qualified 
 to fill the position he aspires to, and should not 
 ask your votes. 
 
 C|[ If he is unwilling to commit himself before 
 election, he would be able, after becoming Pres- 
 ident of the United States, to fall in line with the 
 great banking and corporate influences that have 
 controlled the finances and business of the coun- 
 try up to the present time, and enable them to 
 enact into law the Morgan-Rothschild-Aldrich- 
 Bankers Bill now pending in Congress; or a bill 
 based upon the same principles, which would 
 make permanent the absolute control of all the 
 business of the people of this country by a 
 gigantic money trust. 
 
THE REMEDY. 
 
 BILL to establish a monetary and 
 banking system to conform to the 
 Constitution of the United States. 
 JBe it enacted by the Senate and 
 House of Representatives of the 
 United States of America in Congress assem- 
 bled, That there shall be established at 
 Washington, District of Columbia, the Capi- 
 tal of the United States, a Government bank of 
 the United States. The Government of the 
 United States shall deposit its cash balance with 
 the Government bank of the United States, and 
 thereafter all receipts of the Government shall 
 be deposited with the Government bank of the 
 United States, except, that when necessary, the 
 Government bank may designate other banks 
 for that purpose in cities where there is no 
 branch of the Government bank of the United 
 States. All disbursements by the Government 
 shall be made through the Government bank of 
 the United States. 
 
 (f Sec. 2. The Government bank of the United 
 States and its branches shall pay no interest on 
 deposits. 
 
An American Money-System 1 53 
 
 Cf Sec. 3. The Government bank of the United 
 States may rediscount, for any bank having a 
 deposit with it, notes and bills of exchange 
 arising out of commercial transactions and hav- 
 ing two commercial signatures those of drawer 
 and drawee with the additional indorsement 
 of the bank. This privilege is also granted to in- 
 dividuals on notes and bills of exchange arising 
 out of commercial transactions having three 
 commercial signatures, those of drawer, drawee, 
 and indorser. In place of one of these signatures, 
 however, stocks or bonds may be deposited as 
 security, upon which interest or dividends have 
 been paid consecutively for a period of not less 
 than five years and a statement of the physical 
 valuation of the property upon which they are 
 issued shall be filed with the Government Bank 
 of the United States. 
 
 CJThis shall apply to all notes and bills of ex- 
 change issued or drawn for commercial, agricul- 
 tural, or industrial purposes, and under no cir- 
 cumstances for carrying stocks, bonds, or other 
 securities for speculative investments. 
 CJSec. 4. The Government Bank of the United 
 States shall collect checks or bills of exchange 
 payable in foreign countries for banks and in- 
 dividuals in the United States at a minimum 
 cost. These bills of exchange must bear the 
 
1 54 The Remedy 
 
 name of two or more responsible parties. It 
 shall be the duty of the Government Bank of 
 the United States or any of its branches, upon 
 request, to transfer any part of the deposit bal- 
 ance of any bank having an account with them 
 without cost. 
 
 CJSec. 5. The Government Bank of the United 
 States and its branches shall at once, upon ap- 
 plication and without charge for transportation, 
 forward its circulating notes to any depositing 
 bank against its credit balance. 
 
 Note Issues. 
 
 ^j Sec. 6. There shall be no further issue of cir- 
 culating notes by any national bank beyond the 
 amount now outstanding. The Government 
 Bank of the United States will offer to purchase 
 at a price not less than par and accrued interest 
 the 2 per cent bonds held by national banks and 
 deposited to secure their circulating notes. The 
 Government Bank of the United States shall 
 take over these bonds and assume responsibility 
 for their cancellation (upon presentation) of the 
 outstanding notes secured thereby. The Govern- 
 ment Bank of the United States shall issue, on 
 the terms herein provided, its full legal-tender 
 notes, lawful money of the United States, as fast 
 as the outstanding notes secured by such bonds, 
 
An American Money-System 1 55 
 
 so held, shall be presented for redemption, and 
 may issue other notes from time to time to meet 
 business requirements, it now being the policy 
 of the United States to retire as rapidly as possi- 
 ble, consistent with the public interests, bond- 
 secured circulation, and to substitute therefor 
 real lawful money of the United States in place 
 of banks of issue promises to pay credit money. 
 All notes issued by the Government Bank of the 
 United States shall be full legal tender and pay- 
 able for all debts, public and private, and consti- 
 tute a first lien upon all the assets and services of 
 the people of the United States for their redemp- 
 tion. ! 
 
 IJSec. 7. The governor of the Government 
 Bank of the United States shall be appointed by 
 the President of the United States and confirmed 
 by a two-thirds vote of Congress. 
 CJ Recognizing the sovereignty and equality of 
 the States, each shall be entitled to a director in 
 the Government Bank of the United States, ap- 
 pointed by the governor of the State and to be 
 confirmed by a two-thirds vote of the legislature 
 thereof. 
 
 (f Sec. 8. There shall be a rigid inspection of all 
 banks and a full report of their condition made 
 and the character of business transacted, before 
 being allowed to deposit for rediscount any of 
 
156 The Remedy 
 
 their paper with the Government Bank of the 
 United States or any of its branches. 
 (f Sec. 9. There shall be a branch of the Govern- 
 ment Bank established in every important city 
 in each State, and the rate of interest shall be 
 uniform throughout the United States. To put 
 the people of the United States on the same 
 working basis as those of France, England, and 
 Germany the rate should not exceed 4 per cent. 
 The manager of each branch of the Government 
 Bank of the United States shall be assisted by a 
 local board of directors, selected from among 
 the best qualified commercial, agricultural, and 
 industrial representatives in the region. No 
 officer or director of the Government Bank of 
 the United States, or its branches, shall be al- 
 lowed to borrow from same, but shall receive a 
 fixed compensation for his services, and be a 
 bonded officer. 
 
 <J Sec. 10. The Government Bank of the United 
 States shall be restricted in loans on collateral to 
 approved railroad, municipal, telegraph, and 
 telephone bonds, upon which interest has been 
 reguarly paid out of its earnings for a period of 
 not less than five years and a full statement 
 showing the real physical valuation of the prop- 
 erty upon which these are issued shall be filed 
 with the Government Bank of the United States. 
 A margin of not less than 25 per cent shall be 
 
An American Money-System 1 57 
 
 required on all such securities, upon which the 
 Government Bank of the United States is author- 
 ized to lend. 
 
 If Sec. 11. It is further provided that the Gov- 
 ernment Bank and its branches be empowered 
 to lend money upon approved farms in the 
 United States at not more than 50 per cent of 
 their value and at a rate of interest not exceeding 
 5 per cent, and that the Postal Savings Banks 
 may be also utilized to this end. 
 tJSec. 12. The earnings of the Government 
 Bank from all sources, after paying the con- 
 servative and legitimate expenses of the bank 
 and its branches, shall be applied to the payment 
 of the general expenses of the Government, thus 
 reducing the taxation upon the people of the 
 United States. 
 
 (f Sec. 13. And be it further enacted, That all 
 the money heretofore issued by the Secretary of 
 the Treasury of the United States, authorized by 
 acts of Congress, shall be substituted by lawful, 
 full legal tender money of the United States, 
 thus destroying forever the operation of the end- 
 less-chain process upon the United States Treas- 
 ury. 
 
 fJSec. 14. No banking or financial institution 
 underwriting industrial stocks or bonds of a 
 speculative character or lending money thereon 
 shall become a depositor, borrower, or redis- 
 count any of its securities, directly or indirectly, 
 
1 58 The Remedy 
 
 with the Government Bank of the United States 
 or its branches. 
 
 tJSec. 15. No banking institution allowing its 
 officers, directors, or stockholders to use the de- 
 posits of the bank for private profit, directly or 
 indirectly, or through the co-operation of others 
 for like purpose, shall be allowed to open an 
 account or rediscount any of its paper, directly 
 or indirectly, with the Government Bank of the 
 United States or any of its branches. 
 Cf Sec. 16. It will be the policy of the Govern- 
 ment Bank and its branches to discriminate 
 against those banking and financial institutions 
 carrying demand loans against their borrowers. 
 Cf Sec. 17. And whereas upon the demonetiza- 
 tion of gold, which must come to pass, the United 
 States stands now to be the greatest loser, as is 
 shown by the following figures: 
 
 Gold coin in United States 
 
 Treasury Dec. 1, 1911 . . $1,000,823,215.00 
 Gold bullion in United 
 
 States Treasury Dec. 1, 
 
 1911 . 183,332,234.00 
 
 Gold coin in banks and in 
 
 circulation 613,465,602.00 
 
 $1,797,621,051.00 
 Net exports United States 
 gold coin June 30, 1911, 
 to be redeemed 787,837,314.00 
 
 $2,585,458,365.00 
 
An American Money-System 1 59 
 
 Real metal value 50 cents 
 on the dollar; loss to the 
 people of the United 
 States 1,292,729,182.50 
 
 J Sec. 18. It is therefore further enacted that no 
 more gold shall be coined into American dollars 
 by the United States. 
 
 If Sec. 19. In order that there may be a steady 
 and normal increase of real money into the 
 money system of the United States to keep pace 
 with the increase of population and national 
 wealth, the Government Bank of the United 
 States is authorized to issue an annual increase 
 of 3 per cent of lawful money of the United 
 States, same to be used and paid out as is the 
 money now received from the taxes of the 
 people. 
 
 f Sec. 20. The above percentage of annual in- 
 crease of the money of the United States shall 
 not be changed without six months' notice in the 
 paper having the largest circulation in each city 
 of the United States and by a two-thirds vote of 
 the ensuing Congress. 
 
 CJ Sec. 2 1 . The Government Bank of the Uuited 
 States shall have the power to issue emergency 
 currency in case of threatened panic only, and 
 shall retire same as soon as justified. 
 fij Sec. 22. That no banking or other corporation 
 or association of men shall be allowed to issue 
 any kind of money, currency, or any credit sub- 
 stitute for same. 
 
160 
 
 Effects of the Bill. 
 
 <| 1 st. Free the Government and the people of 
 the United States from the domination of the 
 money power by taking the control of the 
 money of the country out of the hands of bank- 
 ing corporations and restoring its control to the 
 Government to be exercised in the interest of the 
 whole people. 
 
 J 2nd. Enable the people to always get the use 
 of money in legitimate business at a reasonable 
 and uniform rate of interest. The market rate 
 being fixed by the Government Bank, all private 
 banking corporations would have to meet this 
 competition, the effect has been well described 
 by the Governor of the Bank of France. "On 
 certain points there may be competition, and it 
 is on account of this salutary competition, that 
 wherever a branch of the bank has been estab- 
 lished the rate of discount has been perceptibly 
 reduced in the interest of commerce." 
 ^f3rd. Prevent money panics and contractions 
 of the currency. There would be no occasion 
 for a money panic as all solvent banks doing a 
 legitimate business could rediscount their paper 
 at the Government Bank and get the cash when 
 needed. 
 
 JThe Government Bank would thus be the 
 supreme resource, not only of the banks, but of 
 the people in time of need and thus prevent a 
 contraction of the circulating medium of ex- 
 change, the sole cause of panics. 
 J4th. Redeem United States bonds, thus pay- 
 ing off the national debt by substituting lawful, 
 full legal-tender money for the present panic- 
 breeding credit money issued by the National 
 
Reasonable Rate of Interest 161 
 
 Banks, thus saving the taxpayers $7 1 1 ,099,- 
 938.00 principal and $21,332,998.00 annually 
 in interest, which, under the money trust bill 
 now pending in Congress, would run for fifty 
 years at 3 per cent, amounting in principal and 
 interest to the enormous sum of $3,151,626,- 
 000.00 to be paid by the taxpayers. 
 CJ5th. Increase real producers and decrease 
 non-producers by the restrictions imposed by 
 the Government Bank, in refusing as security 
 for loans, bonds and stocks not earning interest 
 and dividends and not giving physical valuation 
 of properties upon which secured. Refusing to 
 do business with banking institutions under- 
 writing industrial stock or bond operations and 
 the loaning of money to non-producers, gam- 
 blers and parasites on such securities, thus pre- 
 venting the manufacture of artificial debts upon 
 the people. 
 
 ][ Money would then go into legitimate and pro- 
 ductive enterprises, thus increasing real pro- 
 ducers and decreasing non-producers. 
 JGive immediate relief and encouragement to 
 the agricultural interests, increase the demand 
 for farm lands, multiply individual homes of 
 real producers, increase the food supply, and re- 
 duce the high cost of living. 
 
 J6th. It will stop the manufacturing of arti- 
 ficial debts upon the great industrial and com- 
 mercial enterprises of the United States. 
 J7th. Stop trust combination and inflated 
 stock operations. It would keep bankers from 
 going into partnership with the promoter to 
 participate in the profits of the underwriting of 
 such securities, as no legitimate banking insti- 
 tution could accept them as securities for loans. 
 
1 62 Reduce Taxation 
 
 J8th. Do away with the present useless and 
 pernicious bank reserves and keep this money in 
 circulation among the people in the communi- 
 ties where it belongs. For any bank complying 
 with the requirements of the Government Bank 
 of the United States, when it needed cash, could 
 obtain it from the Government Bank by re- 
 discount of its paper. 
 
 CJThis Bill will make it unnecessary for the 
 United States to coin a gold metal, that under 
 the operation of the great natural law of de- 
 mand and supply is not worth more than 50 
 cents, into an American Dollar worth 1 00 cents. 
 If foreign countries are ignorant enough to take 
 gold from us at its present value we would be 
 very fortunate indeed in letting them have it, as 
 full legal tender money could be issued in its 
 place, and the people of the United States make 
 the profit. 
 
 tj Answering the howl that will go up from these 
 banking and trust promoters "that the Govern- 
 ment should not go into the banking business 
 and compete with private banking corporations, 
 and that a failure will be the result," will refer 
 to France, which has the only Government-con- 
 trolled bank in the world (whose assets are 
 $1 , 128,223,555), and if the French Government 
 owned the Bank of France it would be far better. 
 As it is, France has not had a panic for 50 years, 
 and the people permanently enjoy a uniform 
 and low rate of interest. This is the testimony 
 of its largest rival in banking business, The 
 Credit Lyonnais, with assets of $415,964,134. 
 JThis bank is organized subject to the law of 
 joint-stock companies and enjoys no special con- 
 cession. 
 
Prevent Money Panics 1 63 
 
 Interview in 1910 Baron Brincard. 
 
 Q. Do you find the Bank of France com- 
 petes with you in any way? A. No. 
 
 Q. They receive accounts from individuals 
 and small tradesmen in the branches, do they 
 not? A. Yes; but they do not grant uncov- 
 ered credits. There is no competition between 
 the Bank of France and the other banks, be- 
 cause they do not do the same kind of busi- 
 ness. The Bank of France receives deposits, 
 but does not allow interest upon them; it only 
 discounts bills with three signatures; it is the 
 banker's bank; it acts as the regulator of the 
 money market. 
 
 Q. For loans on collateral the Bank of 
 France only accepts certain classes of securi- 
 ties, and all other classes of securities are left 
 for the other banks? A. The Bank of France 
 is quite impartial; it gives no preference to 
 anyone; there is no favoritism. 
 
 Q. Have there been any suggestions of 
 change in the system of the Bank of France, 
 or is it regarded as satisfactory? A. We re- 
 gard it as the best system in the world. 
 
 Q. What would you say are the particular 
 functions of the Bank of France aside from 
 the note issue? A. It regulates the rate of 
 discount and in the exercise of its functions 
 it automatically distributes the money in the 
 country where it is required, and this role is 
 perhaps as important as that of regulating the 
 rate of discount. The Bank of France dis- 
 counts bills in every part of the country, and 
 gives notes, gold, and silver in the propor- 
 tions that they are wanted in every part of the 
 
1 64 Bank of France 
 
 country. It is the public itself which indicates 
 the distribution of the money in France by 
 presenting bills for discount, and by asking 
 the Bank of France for the kind of money it 
 needs, and turning in the kinds it does not 
 need. 
 
 Q. The elasticity in your system is fur- 
 nished by the note issue of the Bank of 
 France? A. Yes; the Bank of France is the 
 basis of our banking system and for banks to 
 rediscount. Its organization presents a maxi- 
 mum of safety. 
 
 Testimony of M. Pallain, Governor of the Bank 
 
 of France. 
 
 Q. You admit to discount certain classes of 
 bills which are also discounted by the other 
 banks, and with whom the Bank of France 
 must therefore find itself in competition? A. 
 On certain points there may be competition, 
 and it is on account of this salutary competi- 
 tion that wherever a branch of the bank has 
 been established the rate of discount has been 
 perceptibly reduced in the interest of com- 
 merce. 
 
 Q. Is the rate of discount at all times the 
 same at the Central Bank and at the 
 branches? A. Yes. 
 
 Q. Does the Bank of France make the 
 same charge for discount of bills and for loans 
 on collateral? A. The bank usually charges 
 somewhat more for loans upon collateral than 
 for discount of bills. The rates at present are 
 3 per cent and 4 per cent, respectively. 
 
Low Rate of Interest 1 65 
 
 Q. Are you restricted in the classes of se- 
 curities on which you may make advances? 
 A. Securities which may be admitted as col- 
 lateral are limited by law and decrees which 
 govern the bank and include collateral of easy 
 conversion into cash, such as should at all 
 times be required by a bank of issue. These 
 securities are generally guaranteed by the 
 state, the departments, municipalities, or 
 French colonies. 
 
 Q. Do the banks rely implicitly on the 
 Bank of France to grant them credit when 
 they require it? A. They know very well 
 that in time of difficulty we are the supreme 
 resource. 
 
 Q. How is your note issue limited? A. 
 The maximum note issue at present author- 
 ized is 5,800,000,000 francs. The actual note 
 issue on August, 1910, was 4,600,000,000 
 francs. 
 
 Q. In other words, the bank seeks to reg- 
 ulate the amount of its note issue by the de- 
 mands of business ? A. By virtue of the stat- 
 utory machinery the emissions of the bank are 
 essentially variable and are commanded pre- 
 cisely by the discount or loan operations. It 
 is, therefore, the bills presented for discount 
 and the requests for loans that is to say, re- 
 quirements of business which fix the 
 amount of the issue. 
 
 A. The stability and the moderation of the 
 rate of discount are considered as precious ad- 
 vantages, which the French market owes to 
 the organization and traditional conduct of 
 the Bank of France. 
 
1 66 To the Producers 
 
 Q. Do you think that it would, perhaps, be 
 more advantageous for the Bank of France, 
 considered simply as a bank, to impose differ- 
 ent rates under different circumstances at dif- 
 ferent places? A. As a banking establish- 
 ment, if we thought it advisable to apply dif- 
 ferent rates, we could easily become the mas- 
 ters of the market. But in our position of 
 Bank of France, organized to serve the in- 
 terest of public credit in a democratic country, 
 we do not believe ourselves justified to use this 
 option. 
 
 JIt has been demonstrated in Daniel on Real 
 Money that there is no such thing as a Gold 
 Standard and that gold is a handicap instead of 
 a help in international trade. In fact it is con- 
 clusively shown that the so-called gold standard 
 is a monumental fraud perpetrated by the money 
 lenders on the unsuspecting people of the coun- 
 try because of their heretofore ignorance on the 
 subject. 
 
 <| England adheres to the so-called gold stand- 
 ard as it enables her to sell to the outside world 
 her annual output taken from her South Ameri- 
 can gold mines amounting to $261,372,389.00, 
 not worth more than 50 cents on the dollar, 
 thus yielding her a profit of $130,686,195.00 
 annually. England keeps little of this gold her- 
 self, but unloads it on other countries. In the last 
 report of the Director of the Mint, 1 9 1 1 , the f ol- 
 lowing statement is made: "The two countries 
 of Europe which made the greatest industrial 
 progress during this period (the last ten years) 
 were unquestionably the United Kingdom 
 and Germany, and of the $863,000,000 of 
 
England Unloading Gold 1 67 
 
 gold distributed to all European Banks of 
 Issue, these two which hold the final reserves of 
 money and credit for these countries, secured 
 less than $60,000,000. 
 
 ^f An examination shows that England, now sup- 
 posed to dominate the world on a gold basis 
 and owning more gold mines than any other 
 country has been getting rid of it as fast as 
 possible, and during this period of ten years 
 her banks have added only $ 1 0,000,000 to their 
 reserves. 
 
 CJAs long as the United States remains on the 
 so-called gold basis and Europe holds enough 
 American securities to withdraw the gold, this 
 great country and its business will remain at 
 the mercy of the European money-lenders. 
 On the other hand, if the United States would 
 assert its overpowering importance over these 
 practically bankrupt European countries and 
 put its National wealth back of the full legal 
 tender American dollar and use properly its 
 balance of trade against them, it would become 
 at once the dominating money center of the 
 world. 
 
 Instead of an American Money System Domi- 
 nating the World, We Have the Present 
 Financial Death Trap. 
 
 <JThe economic condition of the people of the 
 world and their suffering are written in the his- 
 tory of money. From the beginning of civiliza- 
 tion it has been the ruling force and the main ob- 
 ject of men; for since barter was substituted by 
 money, the medium of exchange, men must first 
 have money in order to get the things they de- 
 
1 68 Our Financial 
 
 sire; hence universal demand falls upon money, 
 therefore money is the most important economic 
 factor in the business life of the people of the 
 world. 
 
 JThe United States made a new and correct de- 
 parture in its form of government, and it should 
 also have established a new and correct mone- 
 tary system in accord with its Constitution, 
 whereby the people could have accumulated un- 
 mortgaged National wealth, acquired property 
 and paid off their debts and become a really in- 
 dependent people. But before the smoke of bat- 
 tle of the Civil War had cleared away, the for- 
 eign money powers fastened upon this new Re- 
 public the Bank of England money scheme, 
 
 'Banks of Issue" and gold redemption of credit 
 money. Their agents American bankers co- 
 operating with them, established this monetary 
 and banking system, with the intelligent, delib- 
 erate and definite purpose to exploit and finan- 
 cially enslave the people of this Western Hemis- 
 phere by manufacturing debts, National, Cor- 
 porate, and Individual, upon the people. 
 
 The Precarious Condition of the Property and 
 Helplessness of the People Under Present 
 Money System. 
 
 J Total amount of all kinds of money in the cur- 
 rency system of the United States, June 1 1 th, 
 191 1 $3,214,000,000. Deduct 25 percent for 
 the bank reserves. That might as well be at the 
 bottom of the ocean so far as the people are con- 
 cerned, this would leave $2,4 1 0,500,000. Upon 
 this amount of available currency the Banks 
 have made investments in Bonds, Stocks and 
 other Securities amounting to $5,051,900,000. 
 
Death Trap 1 69 
 
 Above this they have loaned bank credits to the 
 borrowers, until the total discounts and loans 
 amount to $13,046,000,000. To sum up, the 
 Banks have demand loans against the people 
 amounting to $2,600,060,760, and loans becom- 
 ing due amounting to $10,626,500,000. 
 <} It can be readily seen that the largest part of 
 this $13,046,000,000 loaned the people, was 
 not money, but the credits of the Banks, upon 
 which they earn interest, yet the borrowers have 
 to make payment in money. Now add to this 
 the fact that the so-called National Banks have 
 issued into this currency system $739,165,313 
 of their bank notes, which they can call in at any 
 time, and the machinery of this financial death 
 trap against the borrowers and the property of 
 the people is complete and ready for action at 
 any time. 
 
 JA panic circular, sent out by the American 
 Bankers' Association, directing the banks to 
 withdraw their note circulation and call in loans 
 can always produce a panic. It is equivalent to 
 directing the banks to contract the currency, 
 make dollars difficult for the people to get, and 
 demand that the borrowers pay their debts in 
 money when manufactured by bank credits 
 at the very time they have made it impossible for 
 the borrower to get money, having withdrawn 
 it themselves from circulation. 
 
 Power of this Financial Death Trap Over the 
 
 People. 
 
 <| To drive down the value of property or securi- 
 ties in order to buy them in. 
 |To bring on a panic and business depression 
 
1 70 Our Financial 
 
 to force legislation favorable to them through 
 Congress. 
 
 CjfTo discredit an Administration antagonistic 
 to their financial and business operations. 
 <|To bring down the general level of all prices 
 and destroy the equity in the property of the 
 people, so that the holder of the mortgage will 
 own the property. 
 
 tJTo make the rich richer and the poor poorer. 
 <f It is only necessary for the American Bankers' 
 Association to notify its members to withdraw 
 of its circulation, call in of their loans, and 
 this financial death's trap has closed upon its 
 helpless victim in every state. 
 ^f All the activities of the people are paralyzed 
 by the contraction of the life fluid of business. 
 Debtors become cowards and supplicants and 
 cry for help. Its blighting influence is felt di- 
 rectly or indirectly in every home and hamlet in 
 this Country. 
 
 C| As a result of establishing Banks of Issue and 
 the gold basis swindle in the United States, the 
 interest and dividends upon manufactured debts 
 is absorbing the net proceeds of labor and thus 
 prevents the people from ever ridding them- 
 selves of the bondage of debts. 
 <J A money system which caused the rich to 
 grow richer and the poor to grow poorer can be 
 advocated only by an enemy of the human 
 family. 
 
 J The effect of the present dishonest and fraudu- 
 lent money system is to impoverish and destroy 
 that great and honest middle class of moderate 
 means that stand between those in want and 
 revolution. 
 JTo make the rich richer and the poor poorer, 
 
Death Trap 171 
 
 is the greatest crime that can be perpetrated 
 against a people ; it not only takes from the poor 
 the dire necessities of their lives, but destroys 
 their moral well being and brings about a deg- 
 radation that drives from their souls the image 
 of their Creator. 
 
 J Having traced this gold basis swindle from 
 its origin in the Bank of England and the trea- 
 sonable methods by which laws were passed 
 through Congress, imposing it on the United 
 States, resulting in the all-powerful control over 
 the business of the people exercised through the 
 machinery of the present money power, and 
 having given the remedy, I call upon American 
 manhood to assert itself and do away with this 
 gold basis credit money system, establish prop- 
 erty as the thing of value, money as the medium 
 of exchange, make man the master above the 
 dollar, free the people from financial bondage 
 and save this Republic. 
 
Arrangements have been completed to 
 prosecute the sale of these Books in every 
 Congressional District in the Union. 
 
 Copies of 
 
 "High Cost of Living" 
 
 Cause Remedy 
 
 have been delivered to the late Presidential 
 Candidates, to the Governors of every State 
 and Territory in the Union, to every member 
 of Congress and to each of the Judges of 
 the Supreme Court of the United States. 
 
 Copies of Daniel on "Real Money" were 
 sent on the following date to 
 
 W^ 
 April, 1911 jjc rJu Woodrow Wilson 
 
 \ JS Theodore Roosevelt 
 
 '^ X V^ ^T William H. Taft 
 
 (/ a/ V> William J. Bryan 
 
 \\e/ ^ j^ O * Robert M. La Follette 
 
 \ ^ <gT cfe - Champ Clark 
 
 <9> \y v.0^ 9}r ^t 5Cafr W- Underwood 
 
 VO N . y ,^ 
 * ^ ^ V 
 
DANIEL ON REAL MONEY 
 
 WASHINGTON, D. C. 
 
 The Author has so elucidated this, apparently difficult subject, that 
 
 it is now criminal negligence for any one not to understand it, in 
 
 order that he may protect himself, his family and his country. 
 
 INDEX 
 
 PAGE 
 
 The Present Banking System 9 
 
 The Present Banking System and Stock Gambling 35 
 
 Wall Street Gold Movement and Money Market 39 
 
 Statements before the Banking and Currency Committee of the 
 
 Sixtieth Congress, Including Statement of T. C. Daniel 52 
 
 J. P. Morgan & Co., August Belmont & Co., and Messrs. N. M. 
 Rothschild & Sons, London, England, vs. The United States 
 
 Treasury 109 
 
 Hearing before the United States Interstate Commerce Commis- 
 sion 119 
 
 A Warning to the United States 147 
 
 Present Money System and So-called Bankers Responsible 159 
 
 President Taft and Gold 161 
 
 Greenbacks, the Worn-out Hobby of the Gold Monometallist 166 
 
 Exchange: Domestic Exchange; Foreign Exchange 170 
 
 Goschen on Exchange 175 
 
 Balance of Trade 180 
 
 The Bank of England 184 
 
 Central Bank of Issue 192 
 
 A True Definition of Money 214 
 
 Gold, the False Basis of Credit Money, Annihilated by the 
 Logic of Common Sense ; Correct Definition of a Standard_230 
 
 The Proper Money System 254 
 
 It is for America, with Her Robust, Enterprising, and Higher 
 Civilization of the Twentieth Century, to Establish a Proper 
 Money System - 266 
 
 The Constitution of the United States provides that Congress, 
 which means the people, shall have the right to create money and 
 regulate the value thereof. 
 
 Shall this sovereign right to create, issue and control money, the 
 most important factor in the welfare of the human family, the meas- 
 uring medium of the value of all services for hire, and property of 
 all the people, be transferred to Banking Corporations or a Money 
 Trust? 
 
 This is the most vital question to be answered by the voters of 
 this Country. 
 
B o*i s 
 
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