Dr. Edwin Vieira, Jr. on the Failure of the Public Sector, the Coming Military Crackdown and What Can Be Done to Stop It
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He is now working on an extensive project concerned with the constitutional "Militia of the Several States" and "the right of the people to keep and bear Arms."
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Daily Bell: Thanks for sitting down with us. Let's get right to it. In your view, what are the most critical domestic problems facing America?
Edwin Vieira Jr.: Two stand out. The foremost problem-because it is the source of, or contributes significantly to, almost every economic difficulty now plaguing this country-is the inherent and ineradicable instability of the present monetary and banking systems centered around the Federal Reserve System.
The second problem derives from the first. It is the ever-accelerating development of a first-class para-militarized police-state apparatus centered around the United States Department of Homeland Security, with its tentacles reaching down into every police force throughout the States and localities.
Fundamentally, this apparatus is not, and never was, designed to deal with international "terrorism". If that were its goal, its first task would be absolutely to secure the southern border of the United States, which it has never seriously attempted to do.
Rather, it is being set up to deal with what the political-cum-financial Establishment anticipates (and I believe rightly so) will be massive social and political unrest bordering on chaos throughout America when the monetary and banking systems finally implode in the not-so-distant future-surely in hyperinflation, and probably in hyperinflation coupled with a gut-wrenching depression.
Of these two problems, the second is actually the more dangerous. For if (on whatever pretext) this police-state apparatus does succeed in clamping down on America, the likelihood of effecting basic reforms in money, banking, or anything else favorable to the American people will be reduced to something approaching nil, absent a veritable political uprising in this country.
Daily Bell: How can these two problems be solved?
Edwin Vieira Jr.: The problem of money and banking breaks down into two interrelated parts: one economic, the other political. Economically, the problem lies in the commonly accepted fallacy that debt-whether the private debt of banks or the public debt of governmental treasuries-can function as sound currency over the long term. "Money" is supposed to be the most liquid of all assets-which is why the best moneys have always proven to be the precious metals, silver and gold. "Debt", conversely, is not an asset at all, but is someone's liability, the value of which is contingent upon the debtor's ability and willingness to pay, and often the creditor's ability to force the debtor to pay. The attempt to put into practice the self-contradictory notion that a liability payable in money can be an asset that functions as money-and that the ultimate debtor or surety in this scheme can be a governmental treasury, which usually cannot be compelled to pay in any event-has been tried again and again, in country after country, and failed again and again. For Heaven's sake, it was tried in this country with the Federal Reserve Act of 1913, and only about twenty years later utterly failed with the banking collapse of 1932, Franklin Roosevelt's seizure of the American people's gold, and the ensuing Great Depression that lasted throughout the 1930s! Right now, we are witnessing what will soon prove to be a more catastrophic failure of that same false idea embodied in that same pernicious institution. Apparently, as the old saw has it, "No one ever learns anything from history except that no one ever learns anything from history." Obviously, massive efforts in public education will be necessary to overcome this deplorable level of ignorance.
In our particular case, the problem also appears in a political form, actually dating from well before 1913: namely, the coupling of bank and state, whereby the government empowers private special-interests groups by statute to "manage" the monetary and banking systems-primarily for the economic benefit of those groups, but as well to the political advantage of the public officials, politicians, and political parties that support the system and receive support from it. The Federal Reserve System is such a coupling: the hermaphroditic creature of private enterprise and statute, at once both quasi-private and quasi-public in source, form, and functions.
Daily Bell: We call it mercantilism.
Edwin Vieira Jr.: Strictly speaking, it is a classic example of a corporative-state arrangement in the particular field of banking, exactly parallel to what Benito Mussolini set up throughout the economy of Fascist Italy, and to what Franklin Roosevelt established for all other American industries in the National Industrial Recovery Act of 1933 (until the Supreme Court declared that act unconstitutional in 1935).
The reason for this unholy alliance between bank and state lies in the operation of "debt as currency":
namely, that using "debt as currency"-and particularly "debt as currency" that can be paid through the emission of new "debt as currency"-allows for the essentially unlimited redistribution of real wealth from society to the issuers of the currency and their immediate clients.
When the redistribution favors bankers and their clients among private businessmen, it is called "forced savings"-the average America being compelled by the system to lose real wealth so that the bankers and businessmen can employ that wealth in their own speculative ventures.
When the redistribution favors bankers and their clients among public officials, it is called "hidden taxation"-the average America being compelled by the system to lose real wealth so that public officials can buy more votes with more governmental spending (with the bankers taking a cut of the proceeds).
In both cases, by the system's very design, the financial and political classes always benefit, the masses are always looted.
The truly vicious nature of this scheme, though, is now appearing in all its ugly nakedness in the multi-trillion-dollar bailouts that the financial Establishment is extorting, and will continue to extort, ultimately from the taxpayers and the victims of inflation, on the threat that, without such payoffs, the entire economy will melt down into irremediable chaos.
So, here we see the ultimate practical truth of the matter: Private financial special-interest groups buy politicians; in public office these politicians empower the special-interest groups by statute to manipulate the monetary and banking systems; to the extent that these manipulations succeed, the profits are largely privatized; and to the extent that the manipulations fail, the losses are almost entirely socialized.
In either case, the general public is held hostage to the racket, and foots the gargantuan bill for its operation. And the guilty parties escape scot free to steal again, and again, and again.
Daily Bell: So what is to be done?
Edwin Vieira Jr.: In principle, this problem can be solved, if America enforces her Constitution. In practice, implementing such a solution will take no little time and effort, though, because: (i) the Federal Reserve System cannot simply be "abolished" at one fell swoop without generating massive dislocations throughout the markets; and (ii) the necessary reforms cannot arise out of the snake pit of Congress in the foreseeable future. Instead, Americans need to create an alternative constitutional and sound currency-actually consisting of, not simply "backed by", silver and gold-to compete with Federal Reserve Notes in the marketplace.
This step must be taken at the State level, for several reasons. First, it cannot be done through Congress, because Congress is thoroughly in the vampiric embrace of the financial Establishment. Second, the States enjoy the legal authority to adopt an alternative currency-indeed, as the Constitution declares, "No State shall . . . make any Thing but gold and silver Coin a Tender in Payment of Debts". Third, the States' exercise of their legal authority to adopt an alternative currency is constitutionally immune from interference by Congress, as even the Supreme Court has held on more than one occasion. Fourth, the States have a political and legal responsibility to their own citizens to protect the public health, safety, and welfare-which necessitates adopting a sound currency to replace the collapsing Federal Reserve Note before it is too late. And fifth, among the fifty States there must be at least a few in which the political and economic climate is such that State legislators can be convinced to take appropriate action.
Once the experiment has been tried and proven workable in one State, it will quickly spread to others, because no alternative exists, other than supine and stupid acquiescence in the collapse of the Federal Reserve System, with all the dire consequences that will entail.
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He is now working on an extensive project concerned with the constitutional "Militia of the Several States" and "the right of the people to keep and bear Arms."
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