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Why Tom Woods is wrong about the Greenbackers

by on April 8, 2013
Why Tom Woods is wrong about the Greenbackers

Left: Tom Woods complaining about lack of MSM airtime

Recently the Austrians have been aiming some firepower at the ‘Greenbackers’ again. As we have documented extensively, Austrianism was developed mainly to organize the opposition against the current monetary order and to mind control it into cheerleading the reinstatement of the Gold Standard, which the Money Power has been planning for decades now. Not much new under the sun, but since they insist, let’s have some more fun with their silly antics.

Tom Woods has 34k likes on Facebook, is asked by friends to run for the Senate, is clearly groomed to play a major role in Libertarianism in the future and looks like the Heir Apparent to Lew Rockwell’s ‘Catholic arm of Libertarianism‘. Certainly an influential fellow and he recently opened up a page on his site called ‘Why the Greenbackers are wrong‘.

As we know, the Greenbackers are the sworn enemies of the Austrians. They don’t like to talk too much about them, lest they would get unwarranted attention, and they usually reserve their gall for the Keynesians. But in fact, the Greenbackers are their ‘raison d’être’, to usurp the real opposition against the Money Power’s control of the money supply. So it’s probably necessary, even if a tad boring, to rebut this 5100 word screed.

Let’s keep in mind what is at stake
We could print enough debt free paper money to pay off the National Debt. This Debt is entirely credit based, for every debt free dollar we print, a credit based dollar would go out of circulation. Meaning: no inflation. After the operation we would have no national debt and the Fed Govt would be spared $450 billion per year in interest payments. This is the Greenback and this is not something the Money Power is going to allow and stopping this is what Austrianism is all about.

This would end the Fed, at least as we know it, and it would nationalize money. This, according to Tom Woods, would mean more socialism. You see, it is clearly better when a private banking cartel prints money, slaps interest on it and a few Trillionaires rake in this $450 billion per year. That is, after all, the ‘free market’, a great example of ‘human action’ by the Rothschilds, certainly not to be interfered with.

As we have analyzed in ‘Libertarianism’s main fault: Blaming the State while ignoring the Money Power‘, the Money Power, which sits at the top of the international power hierarchy, owns all the money supplies in the world, including that of the US. It uses it to enslave us with interest and the boom-bust cycle.

It can do this, because it forced sovereigns in the past to create de facto currency monopolies through legal tender laws and then hand these to the Money Power.

So reclaiming this currency monopoly actually devolves power from the summit (the Money Power) to one level lower, the Government. In short: less socialism than we have now, not more.

And the Greenback is not even the ideal solution. With the current level of Interest-Free Economics it’s probably the least of the acceptable solutions. But the Greenback would be a major step forward and undoubtedly set back the Money Power agenda for decades. It would end the depression and halve the deficit over night. It would bust Wall Street profits, which is a great relief for Main Street paying for these profits through income tax.

Violent Statist Fiat Currency
This is an issue that never ceases to amaze me, when dealing with the Austrians: they’re completely clueless about the different proposals around. They all lump it together in the ‘Greenbacker’ label, that they try to make into something derogatory. That’s why I put together ‘A Primer for Recovering Austrians: the many systems behind ‘violent statist fiat’ currencies!‘, it concisely explores the main propositions at this point.

Of course, we must not forget that it is in the Austrian interest to keep it all neat and simple, so they can keep hammering away at the ‘statist fiat’ nonsense. How annoying, then, that interest-free, free-market units have been turning over untold billions per year for decades.That there are highly developed proposals out there even more powerful than the Greenback, devolving money power even further to the commonwealth and individuals.

The ‘Paper vs. Gold’ meme now sweeping the Alternative  Media is just another pleasant Keynesianism vs. Austrianism dialectic, both ignoring the paper based interest-free alternatives like the Greenback, Social Credit and Mutual Credit.

End the Fed
Woods opens up his hitpiece with the now almost universal Libertarian rechristening of the Truth Movement, that erupted after the 9/11 attacks, to the ‘End the Fed’ movement.

Of course, most Libertarian leaders, in unisono with their dialectical brethren of the left like Noam Chomsky, say Arabs attacked New York.

The Austrians like to slap down ‘conspiracy theories’, just like the MSM do. The only conspiracy they see is the State, but of course ‘free market’ players are just wonderful people in it for ‘enlightened altruism’ Ayn Rand style, aka wholesale profiteering and rent seeking, all ultimately for the greater good.

Murray Rothbard made a few highly amusing cases in the typically deductionist Austrian way, meaning utterly disconnected from practical observation, ‘proving’ cartels in the market are impossible without the Government. Really funny stuff, highly recommended for comic relief.

Of course, as we know, the Bush administration was up to its eyeballs in this Mossad attack. So it’s actually a little weird the Austrians have so much difficulty coping with this rather blatant Government conspiracy.

Woods says the ‘End the Fed’ movement sees some people who don’t understand, because they are Greenbackers.

But it is clear that in the Truth Movement we have some Austrians who don’t understand because they are Money Power goldites.

There is no ‘End the Fed movement’ other than a wholly bogus controlled opposition effort, enabled by Alex Jones who certainly should know better, and some other stooges, disabling the patriots out there.

The Money Power is ready to dump the Fed and Austrianism is here to make sure they both get that and their coveted Gold based new currency order. It’s certainly not for nothing that Alan Greenspan is probably the most famous Austrian out there.

Tom Woods explodes the myth of elite financing of Libertarianism
He doesn’t really want to go into it, because it is such nonsense, but he did ask Mises biographer Guido Hülsmann to comment. Who then goes on to confirm the Rockefeller Institute sponsored Mises. How could he not?

Of course, he completely ignores the Volker Fund, Jesuit involvement in Libertarianism, Ayn Rand doing a Rothschild when she was writing Atlas Shrugged, the billions the Koch brothers poured into Libertarianism, after their father co-founded the Birch society (another bunch of good friends of Tom Woods, by the way) and Atlas Foundation strongman John Blundell explaining how they were ‘littering the world with ‘free market’ think tanks’.

He also tries to dispel this notion with the idea that Austrianism is fringe and thus financing failed. No students hear about Austrianism in college, he says.

Well, compared to the Mainstream, Austrianism is certainly small, although growing very rapidly. Ron Paul educated the masses on the wonders of Gold and deflation and many of them are all for it now. Ed Griffin on Fox, Napolitano all over the media, Peter Schiff and all the others. Compare that to what Populism and Interest-Free Economics receive in airtime.

Let’s also not forget that the Mont Pelerin guys (who are behind the Austrian theories) got eight economic ‘Noble prizes’ (no such thing actually exists, of course) during the last few decades. Not bad for a suppressed opposing system the elite so profoundly fear.

Obviously, as controlled opposition against the Main Stream Austrianism’s time had not yet come. It is only now that the Money Power is ready to kill the dollar and move on to a new currency order that Austrianism has become important.

But we don’t want to tease Tom too much: all these bribes are certainly a bit tasteless a conversation in polite society. Too conspiratorial, I’d say.

On Usury
Most of the article is just one massive diatribe explaining where money comes from and how paper money must always be forced upon the public by the State, for it could not exist otherwise and Gold is the only money that will ever emerge from the free market. They always do this. You will not believe how many Austrians have been explaining ‘that first we bartered, but that was cumbersome and we needed money’.

The whole thing is dazzling, I’m still not sure what he’s actually saying, but it sure does not suggest great clarity of thought. Perhaps he was just scaring people away, I don’t know.

In the first place he attacks the notion that Interest plus Debt cannot be repaid. I’m not going into his reasoning, simply because he makes the case in the worst of ways: others have done so much better. There is some merit to it. But not much. Recently I penned a slightly revised appreciation of the situation and I’d be most interested to hear if any questions remain in this regard.

The debt can never be repaid, period.

Eternal growth of money is guaranteed with paper, eternal deflation guaranteed with Gold because of this issue.

Much worse: Usury costs the poorest 80% of the globe’s populace 5 to 10 trillion per year. I’d certainly be interested in Tom’s comment on this situation. Or any Austrian’s comment, I might add. Never heard anything about it from their side.

As said, Woods also claims Gold has historically been the only money coming out of the free market. Complete crap. The first Gold coins were minted by sovereigns, not by the market. Furthermore, ancient money was actually credit based: receipts for supplies stored in centrally controlled warehouses. This goes back all the way to Hammurabi.

Austrians, as does Woods, have a very fuzzy understanding of what money is. They will often say it’s ‘the most marketable commodity’. Or they’ll cite ‘marginal utility’. Maybe. But what is more marketable than promissory notes? What could have more marginal utility? Perhaps that’s why there are so many interest-free paper based free-market units out there, could be.

But let’s just stick to a simple definition: money is whatever we agree upon as a means of exchange. Even our friends at the Daily Bell have seen the light there.

Woods really takes fuzziness to the downright insane in this video. In it he says that if Greenbackers like debt-free money so much, why don’t they like Gold? Because, Woods explains, Gold is mined, coined and then spent into circulation. So Gold is debt-free!

Excuse me? Does he actually believe this, or is this just propaganda for more feeble minded consumption?

Gold mining adds maybe 1% to known reserves yearly. The rest is safe in Central Bank vaults. Does Tom really believe they will spend these reserves into circulation? Or will it be LENT into circulation, at interest?

As a final note, when dealing with a self-declared Catholic making a career of whitewashing Usury, it’s obligatory to mention that Anton Lavey is on record stating his satanist ‘religion’ is just ‘Ayn Rand’s philosophy with ritual and magic added’.

‘Nuff said.

The level of thinking that these people promote is actually quite insulting to the public. Who, in turn, show how desensitized to outlandish nonsense they really have become, considering the sweeping ascent of Austrianism in the last five years or so.

However, considering the careful long term Money Power strategizing behind it all, we must not bear too harshly on the public and personally I’m very grateful for the ongoing opportunities Austrianism offers for pleasantries as the above.

Faux Economics
Answering Tom Woods
Debunking Tom Woods’ ‘Catholic’ Austrian Economics (Memehunter)
How the Money Power spawns Libertarians
Greenbackers vs. Goldbugs, by Eric Blair (Activist Post)

Addendum: Meanwhile, the Daily Bell cannot let go either. The last few months they have taken the ‘Public Banking and the Greenback are fascist’ line. Because Hitler took money power away from the City and printed his own, everybody doing the same is now a Nazi. Rather predictable, in fact, we did predict this would happen. It’s called ‘Guilt by Association’ and is just one more of the logical fallacies Austrianism is famous for.

Just a few days ago they sighed with relief that “the apparent creation of bought-and-paid-for websites has diminished along with the eruption of fury against those who have the presumption to discuss freedom.”

They are so happy they declared victory by naming the article ‘Mises has won’. Apparently they miss our regular outings dealing with their monetary quackery. My good friend and close ally Memehunter tired a little bit of nurturing the smoldering ruins of Daily Bell credibility at the Daily Knell, focusing on more pressing priorities.

But don’t push your luck guys, he came out of retirement once, he’ll do it again should you get on his nerves with all too blatant manipulations of the debate…..

  1. The role of government should be confined to creating and defending markets, protecting private property and defending the realm.

  2. One: When Woods uses the term ‘greenbackers’ he is referring to 21st century groupies and their favourite charlatans, and not to members, platforms and ideas of the 19th century Greenback Party (which existed under different names). From Fenton Cary and Peter Copper to James Weaver, the real greenbackers considered gold and silver coins and treasury notes the money of the United States, and that was what they requested in their party platforms.
    No Greenback Party leader (or friend) ever proposed the issuing of welfare money, or notes with expiry date.

    1876 September 8
    General Samuel Cary, the nominee of the Greenback Party for the Vice Presidency:—

    We appeal to the honest voters of all parties to sustain our cause, and for the integrity of our purpose and the wisdom of our policy we wait the crystallization of history. If you are in favor of a circulating medium issued exclusively by the Federal Government, a full legal tender for all purposes, and by judicious legislation kept equal to coin in its purchasing power under all circumstances; if you are in favor of the total suspension of all bank issues designated to circulate as money; if you are in favor of the restoration of the silver dollar as a legal tender for the payment of all debts, the platform and candidates of the independent Greenback Party alone give you an opportunity to express your sentiments at the ballot-box. If you are ready and willing to continue the sway of the moneyed oligarchy composed of the capitalists of Europe and of this country, you can vote for your old parties respectively, for they have both alike surrendered to its dominion. Their platforms are just as the money lords would have them.

    January, 1880:—
    Resolved. That it is the sense of this House that all currency whether metallic or paper, necessary for the use and convenience of the people should be issued, and its volume controlled by the government, and not by or through the bank corporations of the country ; and when so issued should be a full legal-tender in payment of all debts, public and private.

    2. Resolved, That, in the judgment of this House, that portion of the interest-bearing debt of the United States which shall become redeemable in the year 1881, or prior thereto, being in amount $782,000,000, should not be refunded beyond the power of the government to call in said obligations and pay them at any time, but should be paid as rapidly as possible, and according to contract. To enable the government to meet these obligations, the mints of the United States should be operated to their full capacity in the coinage of standard silver dollars, and such other coinage as the business interests may require.

    As we may see, Mr. Weaver, the leader of the Greenback Party that receiced more than 1million votes, did not know about the illuminist impossibility p&p equation of 21st century enviro-freak experts. (to this suggestion of Mr. Weaver, future president Garfield, the charlatans’s hero, angrily responded)

    >>>>As we know, the Greenbackers are the sworn enemies of the Austrians.
    The greenbackers, referred to by Woods, and the Austrians are two sides of the same dialectic coin; both are here to discredit the concept of government-issued, sufficient and stable currency. As Migchels pointed out in a recent article, around 2007 the powers behind dialectics elevated to stardom Ron Paul and Ellen Brown; they and the groupies around them spend countless hours talking about the other guys, to make sure that the real solution is not even heard, much less entertained and considered. Migchels talks about Woods, Woods about Ellen Brown, this way they can succesfully avoid introducing and defending their own proposals; proposals which historical examples have proven disastrous.

    Migchels has already shown that Ellen Brown is a liar:–

    So why do book-peddlers fabricate quotes?
    what would they fill their books with without fabrications and the religious dogmas built upon these fabrications ?
    And when is Migchels going to answer these questions ? Can he answer those questions ? so far he avoided them, because he knows the answer is not to his liking

  3. good points…. 1) paying income taxes to pay interest on national debt directly to private individuals is socialism of the worst kind, and the austrian school of economics vehemently opposes greenback proposals to end such socialism… 2) gold will be lent at interest into circulation if it were money and would increase monetary socialism since people would have to borrow gold from the bank at interest to pay taxes to the government to pay interest on national debt to the same owners of gold.

    legal tender is a creature of law and natural public utility. it should remain as such. the state should not grant privilege to bankers or gold owners to profiteer on such a public utility.

    • What bash austrian economics party is complete without the Georgists! The only libertarians i like anymore.

  4. Rhetoric permalink

    Boom goes the dynamite! Well done Anthony. Your tone was perfect. At this point utter shills and traitors to the human race such as Tom Woods deserve as much.

    The control system is so arrogant that it believed the inevitable opposition to an orchestrated global depression and wealth confiscating pyramid scheme could be controlled. And credit where credit is due, you have to tip your hat to these “people”, as they are clearly masters of planning an deceptive execution thereof. So good, in fact, that they have convinced an entire group of insufferable pseudo-intellectuals that their crusade to “end the fed” and “statism” isn’t what it really is, i.e. prostituting for the goals of the international banking cartel in the name of freedom! Eat your heart out Orwell!

    And keep in mind the ring leader of the whole sky is falling charade, Zerohedge, posts articles from “Monty Perelin’s world” and you could barely go an hour during October and November without Ron Paul related posts. They also love to remind everyone of how the Hunt’s tried to corner the silver market, which is of course a total lie. The Hunt’s did that for the system, not against it. The interplay between Infowars and Zerohedge is actually quite elegant in the way that it has conditioned the minds of everyone still involved in this fake patriot movement to parrot and thus manifest ideas that are in no way shape or form in their best interests. Alas, the truth will set you free my Austrian friends. Leave your priest-class propaganda and come join those of us who understand that usury is a rent on a currency monopoly, and that those same rents would be extracted regardless of whether the monopolized currency is FRN’s or Gold.

    The worst part of it all is the unfortunate irony that the voluntary, stateless society all these people want to see can only be achieved through the elimination of the thing that they assure us is a natural part of the free-market. It would be funny if it wasn’t so sad.

    • “The worst part of it all is the unfortunate irony that the voluntary, stateless society all these people want to see can only be achieved through the elimination of the thing that they assure us is a natural part of the free-market. It would be funny if it wasn’t so sad.”

      Indeed: should the power centralization that is inevitably associated with Usury end, we would have to enforce far fewer (extortionist) contracts, nor would there be the dialectical pressure with the marxists who want to redistribute back and thus make the state bigger in their way. Thanks for the reminder, it’s high time to get this bit in the debate also.

  5. The Mont Pelerin Society…

    Friedrich von Hayek, protégé and colleague of Mises, is one of the founders of the Mont Pelerin Society, with Mises a member for at least 13 years. Milton Friedman was a member along with many other noted economists with seemingly different philosophies – e.g. libertarians & the Chicago School.

    The Guardian UK described the Mont Pelerin Society in an article entitled:

    “How the neoliberals stitched up the wealth of nations for themselves, A cabal of intellectuals and elitists hijacked the economic debate, and now we are dealing with the catastrophic effects”

    The author; George Monbiot, describes the common agenda and refers to the paid clique as “neoliberals.” Some Excerpts:

    “When the Mont Pelerin Society first met, in 1947, its political project did not have a name. But it knew where it was going. The society’s founder, Friedrich von Hayek, remarked that the battle for ideas would take at least a generation to win, but he knew that his intellectual army would attract powerful backers. Its philosophy, which later came to be known as neoliberalism, accorded with the interests of the ultra-rich, so the ultra-rich would pay for it.

    “Neoliberalism claims that we are best served by maximum market freedom and minimum intervention by the state. The role of government should be confined to creating and defending markets, protecting private property and defending the realm.

    “This, at any rate, is the theory. But as David Harvey proposes in his book A Brief History of Neoliberalism, wherever the neoliberal programme has been implemented, it has caused a massive shift of wealth not just to the top 1%, but to the top tenth of the top 1%. In the US, for instance, the upper 0.1% has already regained the position it held at the beginning of the 1920s.

    “The conditions that neoliberalism demands in order to free human beings from the slavery of the state – minimal taxes, the dismantling of public services and social security, deregulation, the breaking of the unions – just happen to be the conditions required to make the elite even richer, while leaving everyone else to sink or swim. In practice the philosophy developed at Mont Pelerin is little but an elaborate disguise for a wealth grab.

    “The first great advantage the neoliberals possessed was an unceasing fountain of money. US oligarchs and their foundations – Coors, Olin, Scaife, Pew and others – have poured hundreds of millions into setting up thinktanks, founding business schools and transforming university economics departments into bastions of almost totalitarian neoliberal thinking.

    “The Heritage Foundation, the Hoover Institute, the American Enterprise Institute and many others in the US, the Institute of Economic Affairs, the Centre for Policy Studies and the Adam Smith Institute in the UK, were all established to promote this project. Their purpose was to develop the ideas and the language which would mask the real intent of the programme – the restoration of the power of the elite – and package it as a proposal for the betterment of humankind.

    “Neoliberalism, if unchecked, will catalyse crisis after crisis, all of which can be solved only by greater intervention on the part of the state. In confronting it, we must recognise that we will never be able to mobilise the resources its exponents have been given. But as the disasters they have caused unfold, the public will need ever less persuading that it has been misled.”

    • I can’t stand that fellow Monbiot with his ‘warming-denier’ hatemongering, but he certainly nails them here Larry. It is indeed true: with their insane Plutocracy building, the Libertarians in fact create a larger state ‘needed’ to redistribute part of the stolen wealth back, usually, in the typical marxist way, by taking it from the middle classes while leaving the 0,0001% alone.

      This is actually typically the dialectical way that Monbiot is describing here.

      Another way they are always so reliant on the state is in the enforcement of contract. They need the police to collect all the rents.

    • Bourchakoun permalink

      Excellent point.

      Neo-liberalism is so very close to Austrianism in so many respects.

      Very funny good book here on the fallacies of neo-liberalism and also Austrianism – mentions Ron Paul:

      Dennis Marker: “Fifteen Steps to Corporate Feudalism: How the Rich Convinced America’s Middle Class to Eliminate Themselves.”
      Here a short interview of the author:

      Of course it does not mention the biggest hot potato – the alternative financial system – that is why some media outlets give him airtime. It is similar to Steve Keen’s “Debunking Economics” – only a bit more elaborate. And the title is hilarious.

      Truth of the matter is that our current system should be called: “How the Big Boys convinced the lower 98% to impoverish, stupify and enslave themselves.”

      • Good stuff Bourchakoun – I really like the title “Fifteen Steps to Corporate Feudalism: How the Rich Convinced America’s Middle Class to Eliminate Themselves.”

      • austrian economics is neoliberalism. marx, mises, and keynes all view land as capital. classical liberalism viewed land as a separate component of production from capital.

        • bourchakoun permalink

          Yes – only Austrian Economics has one little treat for the “alternative” crowd: WE are against the FED! See, we the good guys! We will replace the terrible FED with a wonderful gold-backed-free-market (that the banking families can even control and deflate better if it ever comes to that….). Scams after scams after scams – it never ends….

  6. For those that do not believe that a greenback way can work should listen to Webster Tapley’s latest lecture in denver 4/7/13 He explains in great detail how seizing control of the Fed and issuing zero percent trillion dollar century bonds to spend into the economy (among many other things) can initiate a real econmic recovery. A truer enemy of austrian economics you will not find. .

  7. I’ve always found it odd that Woods can parade himself as “oh-so Catholic” when promoting a school of economics that’s very much against the Church teachings. Austrians speak of a “natural rate of interest” (which is BS) while the Church was very much against interest on money (and rightfully so). I felt the same way when reading Bastiat’s “La Loi”: this dude’s view on political economy is completely against his religious views.

  8. REN permalink

    Some pretty funny zingers in there: “profiteering and rent seeking for the common good.” Ha Ha. Ayn Rand was doing a Rothschild. Hmmm.

    That 5 to 10T in usury flows can buy quite a bit of mind control. Usury flows are the tap root that needs to be cut in order to stop Austrian mind control nonsense.

    Bank Money (banker credit money) is good for paying taxes. This gives bank money legitimacy, and hence has better “agreement” than if it was based simply on hypothecation.

    The path would be money creation at a bank, then it goes on to pay taxes, and then it is respent by government. In the meantime, debt instruments increment as time goes by, meaning the money supply is never sufficient.

    But, the reverse path is possible. Greenbacks issued from government, circulate in supply, and then vector into the double entry ledger. The bank must accept them because they are good for taxes. The greenback, initially spent debt free, now vanishes to nothing as it cancels the liability of debt.

    Initially, greenbacks would pay down our balance sheet recession. Later, as they started accumulating in the supply, they would become savings, obviating a need for new bank loans.

    Of course, ultimately usury on the floating greenback supply would vector currency toward rentiers who own monopoly powers, probably over energy and minerals. So, Greenbacks have a weakness, but the real weakness is never discussed by the Austrian mind controllers.

    • One hundred percent REN. That’s my main beef with the Greenbacks. Full reserve banking. It’s not necessary though, they could create JAK banks if they insisted on full reserve banking. Another issue with the Greenbacks is that I’d fear strongly for what the Federal Government would buy with them………

    • Btw, I didn’t really react to your reference to other monopolies gaining currency.
      Good interest free capital would probably end the Transnationals, I believe, because the supply chains would be much cheaper, busting the Transnational’s main strength, cost for capital.

      But whether this could be achieved optimally with a Greenback? Probably not.

      • REN permalink

        It can be reduced to rents. Usury = rents on money. It’s the worst kind because it is invisible and compounds making an impossible contract.

        Land does not follow supply and demand curves, it is fixed quantity. Money is often liquified “assets” such as monetized wealth from the earth. Gifts of the earth are really free, but extraction costs are the main thing monetized, and then rents are added.

        Rents are costs above the true value of production.

        So, if a usurer starts putting land next to land, pretty soon he owns the money supply as well as the means of production. Once he owns production means, he can charge high costs, and extract rents. We then enter into Oligarchy.

        The rail road barons are a good example from history of rentier behavior. Rockefeller and Standard oil made oil scarce by controlling the markets. They also controlled transportation by using private banks (credit money) to buy up land, railroads, and other competitors. These rents then allowed them to suck money out of the supply, and toward them, causing an accelerating monopoly spiral. Oh YES! The market is such a perfect pricing mechanism, especially with rents being taken.

        Our Austrian mind control friends will shill for rents on money (usury) and also shill for rents on land…private property rights! The very thing they shill for is what they are against…supposedly. Their cognitive dissonance is mind blowing.

        Any kind of floating money that has usury on it will end up in the hands of an oligarch over time. It is hard to gain the political will to tax away rentier gains, especially when they are buying off politicians. That is why floating (seigniorage) money, such as Greenbacks, have to be negative interest. No way seigniorage Gold will ever be negative interest.

        Eliminate the usury, and eliminate a lot of other rentier knock on effects. Think of the demurrage as a force vector making the money unit have velocity and hence allowing better pricing in markets. Rents are much harder in that scenario, as the market starts to work, with the market properly signaling price. Monopolizing the means of production also becomes difficult if labor is allowed to save their output as money. Labor then has non usurious means to fund and create local competition.

        To my understanding, transnationals are linked to banks. They are the body parts of smaller companies, patents, and assets that were absorbed during depressions. Transnationals and their banks are able to vote their companies stock and influence government. Today, banks absorb the usury because they create bank money.

        With greenbacks, banks are not creating money, and hence the transnational corporate entity model is damaged. The usury instead will be captured over time by rentiers, probably somehow linked to land and extracting Earth’s free gifts.

        Greenbacks are a different kind of money, traveling a different path, so it will have different outcomes. To my mind greenbacks only work with demurrage, and they should be spent into the base of the population. Government should not be spending the greenbacks, but instead taxing them away from the people.

        • “It can be reduced to rents. Usury = rents on money.”

          Yes, I’m migrating toward this as well. Usury is the heart of the rentseeking, but it’s very similar to land, and also this compound profit issue.

          We’re in full agreement with your ‘greenbacks need demurrage’. They do, either that or JAK banking. Even Gold would work with demurrage, although it will indeed never happen and would be completely unnecessary of course.

          The Transnationals use their own concern bookkeeping to finance the production chains they have collected. Hence no cost for capital. Also, they take all the compound profit out of the supply chain. This is their hidden power.

          If they buy up a company, that adds to their supply chain, they can immediately take out all working capital that is in the firm, replace it with their own, they add to the compounding profits.

          This ends with interest free credit, than supply chains of independently operating firms are cheap to finance too. They’d slaughter transnationals without this problem, because these big firms have bloated bureaucracies.

          • REN permalink

            Yes. I’ve been working on this problem since you mentioned it to me. Major Douglas also noticed it in one of his writings. He used an example, where every node in the production process was financed with bank money. In a large transnational, at the input stage money is converted to an accounting number, what you call concern bookkeeping. From then on, bookkeeping keeps track of the production stages. Workers labor cannot be fairly priced because there is no comparable labor market. Because the large company is not borrowing for each stage, they are not incurring capital costs that would be necessary of a smaller “local” company. The large company is enabled by taking rents on labor and using bureaucracy to drive their operation. Every depression cycle, the larger company absorbs body parts of smaller companies.

            How then to deal with compounding profits? Step into my UMC mythical world.

            If rents are taken out of money, and its volume matches goods and services, as per an updated mutual credit (greenback?) system, pricing in the market becomes much “more” accurate. The cost of capital is zero due to demurrage:

            1) Marginal utility on capital goes to zero, so the ecology stops being raped. We de-monetize much of the economy, and move back toward more of a gift society –especially in important areas, like child rearing.
            2) Entrepreneurs notice holes in the marketplace, as money is signaling accurately (rents much reduced so money not distorted.)
            3) Small local companies form because zero cost capital is available from lower loop savings.
            4) Small companies now allow a pricing mechanism for labor, and efficiencies form.
            5) Excessive profits at each part of the production stage are now damped because the market will signal and respond.
            6) Government is held to its smallest necessary size, as money power is held by the people (supervised by their monetary authority agent). Properly signaling money is flowing in the lower loop; the loop is balanced and not draining.

            The big transnational’s are slaughtered indeed, a good thing. Capital loses its advantage over labor; a new type of capitalism emerges, thwarting the Haegelian dialectic.

            Full reserve banking works in UMC world, but not in a positive interest usury world. JAKS manages to work in usury world, because it mirrors behaviors of gift societies, bypassing rents and those who engage in rents.

      • Bourchakoun permalink

        Great points – REN and Anthony!

        Actually I did not even realize that after having worked for big corporations – even banks – and also for some medium sized companies privately owned companies the one major difference that eluded with me with the smaller companies.

        The 3 medium sized companies with sales of over 100 mio $ had one thing in common: Their owners hated paying interest rates and they were all debt-free! After having paid back the initial loan to start the company they continued to grow organically. Now 2 of those were even very inefficient and had often very destructive ideas that did not work out. However – since they all had no debts they could easily stomach faulty decisions and even recession cycles – those things that quickly crushed the competition due to their debt-based growth-politics.

        Now the big corporations had even the smarter people working there and a better strategy on paper, but they mainly succeed due to finance and the ability to buy the competition, pressure the suppliers and buy almost anything in sight (especially banks are absurd buying everything they might need or never need from office supply companies to real estate that they then rent to themselves as a tax scheme). Many managers are often disgested by the fact that the companies cheerfully fire 5000 people, but then buy a startup for 2 billion $ that might (or probably never will) turn a profit in 20 years (now often seen at pharmaceutical companies).

        In a smart interest-free-money world those companies would be in deep trouble very quickly.

    • that is the weakness of the greenback. however, such weakness can be corrected with land value tax.

  9. Someone should send Tom Woods a copy of Michael Hoffman’s book. “Usury in Christendom: the mortal sin that was and now is not”. If he won’t denounce austrian economics as so much intellectual aspartame, he at least won’t be getting communion on sundays.

  10. Bourchakoun permalink

    True assessment.

    Though likely they do not wish even the “ideal” Austrian economic utopia to ever become a reality – most likely a Chinese-style-fusion of “free” oligopoly enterprises and an all-powerful state. CEOs might automatically become presidents and prime-ministers – elected by the “free” market 🙂 But of course they need to have both extremes covered to reach the desired Hegelian goal.

    Recently I found this little speech by Beppo Grillo (Italy, 1998) actually speaking a lot of truth about our money system – (English and German subtitles). But I got nervous when I saw him flash a gold coin as the sacred eternal means of exchange. At least he mentions the ability for the state to simply print money itself. It is funny how those politicians who are at best a moderate opposition to the system are often portrayed as immature clowns or fascists (Marine Le Pen in France).

    • “Though likely they do not wish even the “ideal” Austrian economic utopia to ever become a reality”
      oh, no, most certainly not. Austrianism will never get its way, it’s just there to make the public ready for gold based money, which will be wholly different in practice.

      They’re just the antithesis going up in the synthesis.

      I’m not holding my breath regarding Grillo. People like him usually are exactly what the doctor ordered to keep the people happy. He reminds me of Wilders.

      He’s making the country ungovernable and he as no real agenda, he basically says everything at the same time, just adding to the confusion, nobody seems to know what he really wants.

      • Bourchakoun permalink

        I agree on Grillo. His current program has even left out the little truth he was talking about earlier.

        Actually I think currently the topics you talk about are almost automatic death sentences to politicians who dare to talk about them. If a major politician (i.e. opposition leader in any country) who has a voice in the media, even drafts plans on speaking about interest-free money-economics then his days are numbered. Sure – the media can ignore him, but only to a certain degree.

        The good thing is that the world will never run out of idealists who do the right thing regardless of the consequenses.

        • Yes. the Money Power never accepts people taking over the System. The only thing they condone is building things beside it. That’s one of the core reasons I keep insisting regional/free market units. For the time being those are the only ones directly feasible while not getting your head shot off.

  11. marxbites permalink

    Sure, dont allow in print what most will never click the link to, eh?

  12. marxbites permalink

    Ohhhhhh, who TF else “legally” sanctioned these bankster criminals then Anthony? Who put in their OWN politician/puppets to do their dirty work, EG Wilson & FDR, then Nixon.

    I believe the Austrians blame BOTH the banksters AND GOVT as the complicit crooks they BOTH are!!

    The POINT is that NO Austrians EVER supported the political govt sanctioning of monopoly banking privleges on the powerful few. NEVER HAVE, NEVER WILL.

    Indeed they CORRECTLY see it as the seeds of tyranny its always been throughout history from pot metal denarii to irredeemable debt money fiat from thin air PLUS interest.

    • No Marx. They say ‘end the fed’, not ‘end banking’, or ‘end usury’, or ‘end money power’. ‘End the Fed’ and let the banks as our hallowed free market pioneers do as they must undisturbed. That’s what Austrians want.
      Preferably with Gold too, making Usurious Usurpation even worse.

      If you really hate usury, you have fallen for a big trap, but I’ve been trying to explain this to you for more than a year now.

      And you know I’m no friend of Government. That’s why I promote even further decentralization than the Greenback.

      • marxbites permalink

        Usuary on money from thin air is ONE thing, a bad humanity impoverishing thing.

        Me charging you some interest on the loan of MY OWN risk capital is a completely and voluntary OTHER thing.


        • money created by banks to pay taxes and rent upon usury is one thing. money created interest-free by government to pay taxes (ideally land value rents and user fees) is another thing.

  13. marxbites permalink

    “As we have analyzed in ‘Libertarianism’s main fault: Blaming the State while ignoring the Money Power’, the Money Power, which sits at the top of the international power hierarchy, owns all the money supplies in the world, including that of the US. It uses it to enslave us with interest and the boom-bust cycle.”

    What total bullcrap Anthony.

    There isn’t an Austrian I’ve studied who doesn’t revile the money monopoly cartels, indeed they always have, and they SEE & DESCRIBE them as the black hearted tyrants terrorizing humanity they are.

    More proof you loons HAVE EVEN NEVER READ those who have always wanted a free market in competing currencies free of the banksters.

    To wit – Rothbard
    Excerpted from:
    Taking Money Back

    Please don’t litter the pages with Rothbard where a link suffices Marx Bites. Thanks!

    • That’s not the point Marx Bites. They blame Government for these monopolies. THAT’s the point.

      • marxbites permalink

        So iows the Austrians DO blame the cartelist banksters as well and always have as the root source.

        Esp since they blame the system as being Marx’s central banking road to serfdom.

        Catch some clues, read Rothbards History of Money and Banking….

        Click to access historyofmoney.pdf

        • REN permalink

          I got to about page 65 and couldn’t take it any more. Lots of things wrong on Mass Bills. Also, on continentals I couldn’t find anything on the massive British Counterfeiting. Maybe I missed it, but that is a pretty big omission. If I can stomach it, I’ll hold my nose and read some more.

          Stephen Zarlinga’s book, “The lost Science of Money.” is recommended for some enlightenment on history. But, just remember Zarlinga like Rothbard is weak on the impact of usury. Neither seem to understand how it compounds in production cycles, as if the market was “magic.”

          • I can’t stomach that fellow, why waste your beautiful mind on torturing yourself with actually reading Rothbard….

            People may think I’m aggressive, but look at Gary North and his master Rothbard. The arrogance of these people when they tout their nonsense is really very hard to stomach if you know what they’re actually saying.

            • Greg Solano permalink

              Having read your confused screed, I can see why you fear Murray Rothbard and his lucid and concise language. The cabal you shill for feared Rothbard too. Serves you right.

              • Rothbard never really threatened the money power cabals with his usurous gold backed currency issued by private banks. He operated well within the dialectic they control. His ohly issue may have been one of timing, for fiat was far from its predestined ruin when he wrote.

                But his work is full of such contradictions. For example, what anarchist/anti-statist would argue for the use of torture by govt? He did so and in such a way as to make modern neocons blush:

                “In every crime, in every invasion of rights, from the most negligible breach of contract up to murder, there are always two parties (or sets of parties) involved: the victim (the plaintiff) and the alleged criminal (the defendant). The purpose of every judicial proceeding is to find, as best we can, who the criminal is or is not in any given case. Generally, these judicial rules make for the most widely acceptable means of finding out who the criminals may be. But the libertarian has one overriding caveat on these procedures: no force may be used against non-criminals. For any physical force used against a non-criminal is an invasion of that innocent person’s rights, and is therefore itself criminal and impermissible. Take, for example, the police practice of beating and torturing suspects – or, at least, of tapping their wires. People who object to these practices are invariably accused by conservatives of ‘coddling criminals.’ But the whole point is that we don’t know if these are criminals or not, and until convicted, they must be presumed not to be criminals and to enjoy all the rights of the innocent: in the words of the famous phrase, ‘they are innocent until proven guilty.’ (The only exception would be a victim exerting self-defense on the spot against an aggressor, for he knows that the criminal is invading his home.) ‘Coddling criminals’ then becomes, in actuality, making sure that police do not criminally invade the rights of self-ownership of presumptive innocents whom they suspect of crime. In that case, the ‘coddler,’ and the restrainer of the police, proves to be far more of a genuine defender of property rights than is the conservative.

                We may qualify this discussion in one important sense: police may use such coercive methods provided that the suspect turns out to be guilty, and provided that the police are treated as themselves criminal if the suspect is not proven guilty. For, in that case, the rule of no force against non-criminals would still apply. Suppose, for example, that police beat and torture a suspected murderer to find information (not to wring a confession, since obviously a coerced confession could never be considered valid). If the suspect turns out to be guilty, then the police should be exonerated, for then they have only ladled out to the murderer a parcel of what he deserves in return; his rights had already been forfeited by more than that extent. But if the suspect is not convicted, then that means that the police have beaten and tortured an innocent man, and that they in turn must be put into the dock for criminal assault. In short, in all cases, police must be treated in precisely the same way as anyone else; in a libertarian world, every man has equal liberty, equal rights under the libertarian law. There can be no special immunities, special licenses to commit crime. That means that police, in a libertarian society, must take their chances like anyone else; if they commit an act of invasion against someone, that someone had better turn out to deserve it, otherwise they are the criminals.

                As a corollary, police can never be allowed to commit an invasion that is worse than, or that is more than proportionate to, the crime under investigation. Thus, the police can never be allowed to beat and torture someone charged with petty theft, since the beating is far more proportionate a violation of a man’s rights than the theft, even if the man is indeed the thief.” (Rothbard 1998: 82–83).
                This passage means that, in Rothbard’s anarcho-capitalist world, the police from private protection agencies would be allowed “beat and torture” suspects “to find information,” and they would face no penalty or criminal charge for violence against such a suspect, as long as the suspect is found guilty.

                Rothbard protests that private police cannot be allowed to “wring a confession” – even though there is a fine line between the two. In fact, with no ability to hold to account the activities of private protection agencies anyway, since they would be like private mafia groups, one can imagine what incredible abuses what develop in such a system: corrupt private police and private courts using torture and violence to quickly get a confession from suspects and “guilty” verdict.

                Rothbard, M. N. 1998. The Ethics of Liberty, New York University Press, New York, N.Y. and London.

                I guess all his talk of self ownership and civil liberties applies as long as you don’t mess with their gold. Then all is off the table….

                • pffff…..the longer you look at these guys, the worse it gets pm………

                  • indeed, but for the sake others do we do this. I was once taken by the reputation and second hand accounts. Nothing dispells illusion like a quotation from the man himself.

    • the natural public utility of legal tender is a creature of law and should remain strictly that… to grant privilege to banks (or to gold owners) to provide such legal tender is feudalism (neosocialism)…

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