Page 2 of 2 FDR's dream comes true as nightmare By Antal E Fekete
currency. Is there any defender of the irredeemable dollar, even among those
who try to convey the impression that the majority of people wanted to abandon
the gold standard in 1932, who has the moral courage to refer to these
speeches? Roosevelt further said:
The businessmen of the country,
battling hard to maintain their financial solvency and integrity, were told in
blunt language by President Hoover in Des Moines, Iowa, how close an escape the
country had had some months ago from going off the gold standard. This, as had
been clearly shown since, was a libel on the credit of the United States … No
adequate answer has been made to the magnificent philippic of Senator Glass the
other night, in which
he showed how unsound was this assertion. And I might add that Senator Glass
made a devastating challenge that no responsible government would have sold to
the country securities payable in gold if it knew that the promise, yes, the
covenant embodied in these securities, was as dubious as the President of the
United States claims it was.
I quote Warburg: "On March 12,
1933 - a week after Roosevelt had become President - the United States Treasury
issued US$800,000,000 of obligations payable 'in United States gold coin of the
present standard of value' - the same covenant above referred to by Roosevelt a
few days before he was elected. Additional securities were issued shortly
thereafter bearing the same covenant.
"On May 7, 1933, President Roosevelt in a radio broadcast to the people
announced his intention to repudiate this covenant. And on June 5, 1933, the
covenant was abrogated by Congress. The point is not whether we agree or
disagree with Roosevelt’s judgment or reasoning. The point is that if he had
such a conviction in regard to the gold clauses and intended to act upon it, it
would seem that the people had the right to know about it before they were
asked to vote."
Afterlife of gold theory
The US Mint was reopened to gold after the hiatus of the Civil War and
Reconstruction, on January 2, 1879. In celebrating the event General James A
Garfield stated in an address delivered in Chicago:
We shall still hear
echoes of the old conflict, such as the "barbarism and cowardice of gold and
silver" and the "virtues of fiat money". The theories which gave them birth
will linger among us like belated ghosts, but soon will find rest in the
political grave of dead issues ...
Garfield warned that the
"periodic craze" of fiat paper money might sweep over this country from time to
time. The force of the present episode of craze has apparently never before
been experienced by our people. The end of this great disease is not yet in
sight. If past experience provides any worthwhile lessons, then the ultimate
consequences of our failure to understand the nature of this craze promise to
be extremely painful, involving the greatest monetary and economic devastation
the world has ever seen.
Orval W Adams, one-time president of the American Bankers Association, in his
article "Inflation - The Termite of Civilization" wrote in 1956:
Open the Mint to gold. Gold is a gift to the world from an all-wise Creator.
There is no substitute. There will never be any. Without gold as a base for
national and international exchange, civilization could not have emerged from
its barter period of the Dark Ages. Gold is the only insurance against ruthless
politicians debasing and corrupting the world’s exchange and money systems of a
free people. I repeat, gold is a blessing from an all-wise Providence to
prevent the tragedy that follows a debased, corrupted and politically managed
medium of exchange. The gold standard is the automatic watchman on the tower of
the government of free men, to guard against the poison of totalitarianism
entering the bloodstream of sound money. On many an
occasion was the gold standard gleefully, albeit prematurely, buried. One such
occasion was the "funeral oration" before the Chamber of Deputies in
Nazi-occupied Paris, delivered by one of the highest-ranking functionaries of
the Nazi party. He declared "with deep inner satisfaction" that "the gold
standard is now as remote from the realities of life as the philosophy of the
French Revolution: Liberty, Fraternity, and Equality of men ..."
When Roosevelt confiscated our people's gold and forced them to accept
irredeemable bills of credit in exchange, the purpose was to provide the
government with liberty to do as it pleased with the product of other men's
labor, while depriving people of the liberty to insulate themselves from
government arbitrariness by converting the products of their labor into gold if
they so desired. In doing so Roosevelt opened wide the door to government
tyranny, which has shown itself in wild government spending, heavy taxation,
radically depreciated currency, a huge national debt, much socialization and a
high and increasing degree of government management of the economy, even in the
suspension of civil rights.
Today, a lot of people celebrate the advent of $1,000 gold. In their festive
mood people are liable to forget an ominous consequence of this important
milestone. It is the fulfillment of Roosevelt's design to deprive people of the
liberty to shelter the fruits of their labor from the claws of the government
by converting their property into gold. At $1,000 an ounce, not many people can
purchase gold to protect the fruits of their labor against confiscation.
Gold at $1,000 is a milestone - on the road to hell.
Antal E Fekete has since 2001 been consulting professor at Sapientia
University, Cluj-Napoca, Romania. In 1996, Professor Fekete won the first prize
in the International Currency Essay contest sponsored by Bank Lips Ltd of
Switzerland. He also runs the Gold Standard University.
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