7/31/2019 Tax Money Not People

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By Richard PalmquistEverybody agrees we should all pay

our fair share of taxes. What is our fairshare? Is it to pay our tax twice? If youpay income tax, you do just that. Inflationcosts everybody. It is the first tax. Second,you pay the IRS each April 15.

However, the private owners*of the

Central Banks of the world dont have topay tax at all -- not even once. They havethe power to create unlimited amounts ofmoney. They can work with the govern-ments of the world to use the currency cre-ation process to transfer real wealth tothemselves.

How is money created?Local banks create money when they

lend. By simply making a bookkeepingentry, a banker can lend many times asmuch money as people have depositedwith him.

In contrast, Central Banks lend mon-

ey to governments. They can create an un-limited amount of money -- as much astheir government asks for. They sit at thecomputer and debit one account and creditanother account. The money is there in-stantly. The credit becomes money. Thedebit becomes the Federal debt.

When Central Bankers create achecking account for a government, it isnot necessary for the account holder to de-posit money into the account. After all, theFed is never audited. It can set up a check-ing account any way it wants.

A government checking accountcould make it possible for the U.S. Trea-

surer to write checks, overdrawing the ac-count as much as public policy allows.

Our Federal Reserve, however, ismore clever than that. When our govern-ment needs money, the Fed lends the mon-ey to the government. Then it charges in-tereston that loan.

What is money?For centuries money has been: 1) a

medium of exchange; 2) a unit of account;and 3) a store of value. Modern definitionsof money have strayed from this standard,but money still must be desirable, havenumbers on it, and be a way for us to getwhat we want.

Today's money seems to fail the val-ue test. It is not backed by gold or silver.Instead, money today is backed by whatit will buy.

Our method of money creation givesCentral Bankers a theft tool. The moneythey create has no value, but they stillcharge interest when they lend it to ourgovernment. The money costs the bankersnothing. Yet, to pay the interest charge,governments must borrow the interest

payment into existence. Every dollar cre-ated increases our national debt by a dol-

*Federal ReserveBanks are privately owned. Federal Reserve Governorswork for the government controlled Federal ReserveSystem.

lar. That dollar requires more dollars to becreated to pay more interest. Then you andI pay the bill through the income tax. Thisbecomes a tornado, with debt sweepingupward leaving bankruptcies and other so-cial destruction in its path.

With the unearned interest, CentralBankers buy valuable things. This wealth

becomes theirs in direct proportion to thecurrent interest rate.

Interest creates inflationUnder the Gold standard, bankers

earned interest when they lent to govern-ments. Today, Central Bankers are paid afee for lending us what is already ours.

Every dollar created is borrowedinto circulation with the interest burden at-tached to it. That interest can never be re-paid, so more currency must continuallybe pumped into the economy to keep thescam going. Economists call the result "in-flation," and they are correct as far as they

go. This process mandates an increase inthe number of units of currency. The care-less observer sees only the increase in themoney supply as the cause of inflation.Most economists insist that price increasesare the result of "too much money chasingtoo few goods." What they fail to see isthat the increase in currency happens asbanks lend the government what alreadybelongs to the government. If there wereno build-up of compound interest, therewould be no need to inflate the currency,no necessity for price increases and nospiraling national debt.

GNP - the "gold substitute"A dollar is worth what it will buy.

Any realist must accept that fact.To be consistent we must look at

what a dollar buys to learn what it isworth. We use dollars to buy the productsand services we need. What we buy iscalled the Gross National Product or, morenarrowly, the Gross Domestic Product.

The Economics and Statistics Ad-ministration of the United States Depart-ment of Commerce calculates the GNPand the GDP. The GNP includes wages,rental income, corporate profits, net inter-est, national income, business transferpayments, indirect business tax and non-tax liabilities less subsidies, and chargesagainst net national product.

Certain charges are subtracted fromthis total figure, and a statistical discrepan-cy is allowed. Personal consumption ex-penses are then added to gross private do-mestic investment and net exports ofgoods and services, along with govern-ment purchases of goods and services. Thetwo columns of figures are balanced, andthe result is the GNP.

The formula should be changed. The

money government spends on its ownneeds should not be a part of the formula.

With this change, the GDP would sfrom month to month an accurate tothow people meet each others needs.

Let them write checksEach bookkeeping period we c

tally the growth in that revised GDPure. Government would pay its expe

by writing checks up to that amoungovernment spent more money into clation than the amount of growth inGDP, businesses would know they shraise their prices. If government spentthan the growth in the GDP, howbusinesses could cut prices.

How can the government wchecks continually and never makeposits? The bank overdraft does not ter. Government and the Federal Res"own" the power of money creation.Federal Reserve is never audited! As as money is created out of thin air, govment should use that money creating p

er instead of collecting taxes.True, a gold and/or silver stanwould be a more righteous system if controlled it. However, it was that syin the past that led to our present agbanking thievery. Bankers can put thein the vault. That works, but nobodhistory has been honest enough to cthe gold accurately. They cheat.

Let us force money creators to stheir own clever system. Without inctaxes to pay back their inflation tax thery, Central Bankers would have to money by honest work, like the rest of

Maybe then the bankers would a

to change money creation and bring iage of honest Constitutional moWhether Utopia arrives or not, thoughcome tax is not necessary in today's mtary system.

Let government support itselfwriting checks up to the amount of groin the economy. The result would be nomic balance, prosperity and indivliberty.

What can be done?Criminal or not, the scam c

Central Banking is well established pcally. It will never be changed. Taxpawho want their dollars to be worth thgal definition of money must work wthe system to reach their goals.

We should accept money creapolicy for what it is: a tax. It is a tathe money supply. We should supgovernment by tolerating interest-infltax. But that is the only tax we shouldInterest-inflation tax is tax enough!

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