“Don’t Buy Government Bonds”

As another farcical “debt-ceiling raising” saga unfolds, conducted by the two indistinguishable political parties hell-bent on driving America into economic ruin, it would be instructive to look at how some earlier conservative/libertarian thinkers viewed public debt. Unlike the present generation – with the notable exception of Ron Paul – these intellectuals asked fundamental questions about such matters as debt, taxation, central banking, and foreign policy.

One of the leading lights of what was known as the “Old Right” of the 1950’s, which opposed the Cold-War globalism of the likes of William Buckley and domestically sought to overturn the New Deal, was Frank Chodorov (1887-1966). In his books and essays, Chodorov challenged the pillars which social democracy rested and sought to return America to small government, free trade, and “isolationism.”

In one of his provocative essays, Chodorov pervasively argued that those who purchase public debt are complicit in the enhancement of state power. Unlike many present-day economists who only see the baneful economic effects of profligate government borrowing, he makes a moral case against debt financing.*

He points out that public borrowing burdens future generations for the benefit of the present. Despite reasons often given for the necessity of borrowing – war, natural disaster, infrastructure, etc., – Chodorov contends that the practice of shifting the cost to later generations, whatever the reason, is unjust:

This is exactly what you do when you
cooperate with the State’s borrowing
program. You are loading on your children
and your children’s children an obligation to
pay for something they had no voice in, and
for which they may not care at all. Your
‘investment for posterity’ may earn you
nothing but the curses of posterity.

Chodorov understood, as most commentators do not today, that a gold-backed currency restrained State largesse: “When money was redeemable in gold, the inherent profligacy of government was somewhat retrained; for, if the citizen lost faith in his money, or his bond, he could demand gold in exchange, and since the government did not have enough gold on hand to meet the demand, it had to curtail its spending proclivity accordingly.”

It was Franklin Delano Roosevelt’s despicable and criminal act of taking the U.S. off the gold standard domestically that led to the expansion of the public debt as Chodorov describes: “. . . Mr. Roosevelt removed this shackle and thus opened the flood gates. The only limit to the inclination of every politician to spend money, in order to acquire power, is the refusal of the public to lend its money to the government. . . . the government can then resort to printing of money, to make money out of nothing. . . .”

Not realized at the time, but the ability of the American government to expand its revenue base fit nicely into FDR’s later nefarious foreign policy objectives.

Chodorov’s viewpoint on public debt can also easily be applied to FDR’s decision to eradicate the gold standard through which the U.S. currency could be redeemed for precious metals. FDR’s act, however, was a “violation of contract” with American citizens since the U.S. government defaulted on its obligations.

In Orwellian fashion, the verbiage used with most government operations is often misused to legitimize State functions. “Investment” is one such term that has been corrupted in relations to spending and debt.

In promoting their spending schemes, politicians will often use the term investment, “investment in education,” “investment in infrastructure,” etc. This is deliberate, since it tries to equate government spending with a vital component of the market process.

In a market economy, investment means the lending of savings, which is used to expand and/or start an enterprise. In return, the lender receives a stock or a bond. If the business is successful, the lender’s investment will receive a return – dividends from a stock or interest from a bond. Business investment is, therefore, a necessary aspect of capitalism which results in economic growth and increased living standards.

As Chodorov incisively points out, however, government investment is the antithesis of what takes place in the marketplace:

The State, however, does not put your money into production. The State spends it – that is all the State is capable of doing – and your savings disappear. The interest you get comes out of the tax fund, to which you contribute your share, and your share is increased by the cost of servicing your bond.

Chodorov’s solution to deficit financing was not to buy government bonds. While this would certainly be a step in the right direction, a more radical approach is needed since the problem has now become so immense.

Simply put: there should be a prohibition on government borrowing of any kind. State revenues should only come through tax receipts and fees paid by those in the present. This would completely eliminate the “moral hazard” of debt financing and drastically reduce the size and scope of government over society.

For those who seek to put an end to the current debt-ceiling charade and rectify the immoral practice of burdening future generations by the irresponsibility of the present, the works of Frank Chodorov are essential.

* “Don’t Buy Government Bonds,” The Mises Institute, 13 January 2011. https://cdn.mises.org/Out%20of%20Step_4.pdf

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

The Convention of States Project: A Bad Idea

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Similar to Patrick Buchanan’s campaigns, Newt Gingrich’s “Contract with America,” the Tea Party, and to some extent Donald Trump’s presidency, the Convention of States Project* will not solve the crises that America faces. It will, undoubtedly, like most of the previous reform and populist movements be sabotaged by the ruling class if it ever gets close to accomplishing its goals.

The Project’s rhetoric is “old-style” conservative/populist-speak which seeks to “[propose] amendments that impose fiscal restraint on the federal government, limit the power and jurisdiction of the federal government, and limit the terms of office for its officials and for members of Congress.”** Some of the proposed amendments include:

Congressional term limits
Requiring a two-thirds vote of the House and Senate to increase the public debt
Restoring the Commerce Clause to its original intent and scope
Repeal of the 16^th Amendment, which gave us the income tax
Giving states, by a three-fifths vote, the power to negate any federal law, regulation or executive order giving Congress an easy means of overriding regulation

So far, 19 state legislatures have called for a constitutional convention, 34 states are needed for a convention to be called and, for an amendment to be passed, it must be approved by three quarters of state legislatures.

The state legislatures who have signed on have realized that the federal government has become omnipotent and the individual states are now merely appendages to Washington. “The states,” said South Carolina state representative Bill Taylor, “have sort of lost their voice, and all we can do now is beg from the cheap seats and say, ‘Hey, don’t do that.’”***

After the totalitarian and draconian efforts of the U.S. government and those around the world the past two years in response to the “pandemic,” Mr. Taylor’s sentiment is, to say the least, an understatement!

The fundamental problem with efforts such as the Convention of States Project is that they do not understand the nature of the crises that both America and most of the world face. For America, its current malaise can be traced shortly after its independence with the adoption of the Constitution itself.

While it has long been touted as a great document of freedom and liberty, it is anything but. The “founding fathers” knowingly created a powerful central government and decreased the sovereignty of the individual state governments which had existed under the Articles of Confederation.

In the words of Murry Rothbard, the Constitution was a coup that, for the most part, was the antithesis of the spirit and drive of the American Revolution which was a movement against political centralization and empire:

It was a bloodless coup d’etat against an unresisting

Confederation Congress. . . . . The Federalists, by use

of propaganda, chicanery, fraud, malapportionment of

delegates, blackmail threats of secession and even

coercive laws, had managed to sustain enough delegates

to defy the wishes of the majority of the American people

and create a new Constitution.****

Worse than the power grab was the establishment of an omnipotent state as Rothbard incisively continues:

The drive [for ratification] was managed by a

corps of brilliant members and representatives

of the financial and landed oligarchy. These

wealthy merchants and large landowners were

joined by the urban artisans of the large cities in

their drive to create a strong overriding central

government – a supreme government with its

own absolute power to tax, regulate commerce,

and raise armies.*****

410jXD-zO+L

The celebrated “separation of powers,” and “checks and balances” within the federal system and even the Bill of Rights, so often lauded by conservative and populist commentators, have proven from the very start to be ineffectual in stopping the expansion of state power.

The Constitution itself declares that it is the ultimate authority as Article VI states:

This Constitution and the laws of the United States which

shall be made in pursuance thereof, and all treaties made,

or which shall be made, under the authority of the United States,

shall be the supreme law of the land. . . . [Italics mine.]

The massive and now unresolvable social, economic and political troubles both in the U.S. and around the world stems from a concentration of political power that is inherent in the nature of constitutional government. This power is augmented and sustained by a system of central banking which provides the nation state with seemingly unlimited financial power to implement its various social engineering schemes, conduct continuous warfare, and has the ability to crush any opposition to its hegemony.

The solution, which is all too obvious, but not attainable in the current ideological atmosphere dominated by statist thinking, is political decentralization.

The smaller political alignments under decentralization would probably coalesce around peoples with similar economic, social and religious affiliations and status and those with similar ethnic and racial backgrounds. Such a system would be truly diverse and undoubtedly lower social tensions which derive from the central state’s forced integration polices.

Once political decentralization became a reality, the natural and mutually beneficial relationships and interactions between peoples would emerge. The immense advantage of free trade – the widening of the division of labor and specialization – would be the norm between societies since smaller countries could not afford to restrict trade since doing so would lead to autarky and the resultant fall in standards of living to primitive levels.

Likewise, a universal monetary standard, most likely based on gold and silver, would arise among differing communities since a multitude of currencies would lead to monetary chaos and render economic calculation an impossibility. Since no central state could impose its currency, the only honest and sound money – gold/silver – would be quickly adopted by all.

The mass invasion of the U.S. taking place under the negligence and encouragement of the Biden Administration could also be thwarted through political decentralization. Areas where the lives and property of people are threatened by invaders have more of an incentive to effectively deal with unwanted groups than bureaucrats living often times thousands of miles away.

Each jurisdiction would make its own policies on who or how many it wanted in its territory. Moreover, each community could expel undesirables without interference from those who are not property owners or members of such communities.

While those behind the Convention of States Project and the state legislatures which have called for a constitutional convention may be well meaning, they will ultimately fail. Such efforts are a wrongheaded approach to address the myriad of problems that plague the U.S. and, for that matter, the entire world.

Instead of attempts to amend the Constitution or though the electoral process by finding the “right candidate,” the very viable and historically proven alternative of de-centralization through secession is the only pathway to ultimate success. Until the break-up of the nation state is accomplished, America and the world’s future will be considerably bleak.

*https://conventionofstates.com/

**https://starkrealities.substack.com/p/activists-more-than-halfway-to-forcing

***Ibid

**** Murray N. Rothbard, Conceived in Liberty. Vol. 5, The New Republic, 1784-1791, ed., Patrick Newman. Auburn, AL.: Mises Institute, 2019, p. 306.

*****Ibid.

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

Trump’s Inflation

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Former President Donald Trump attends a rally in support of Arizona GOP candidates, Prescott, Ariz., on July 22, 2022. (Mario Tama/Getty Images)

Once again, former president Donald Trump criticized the Biden Administration for the record consumer price increases that Americans are now paying. His remarks followed up on his July 4^th speech in Wyoming where he lamented about the state of the nation: “I know it’s not looking good for our Country right now, with a major War raging out of control in Europe, the Highest Inflation in memory, the worst 6 month Stock Market in History, the highest energy prices ever.”*

In his most recent campaign rally for GOP hopeful Kari Lake, Trump lambasted President Biden for creating the “worst inflation in 47 years”** and for his “war on American energy” which Trump believes has contributed to the record hike in fuel prices.

The former president boasted that had he been re-elected “none of these terrible events would have happened.” He reassured his audience “not to worry” and that “we will make America great again.”

As with all of his post-presidential rallies, Trump’s criticism of the Biden regime comes with touting his own accomplishments as chief executive. Most of these claims are so outrageous they damage or totally negate his critique of Biden’s policies and make Trump sound like a fool.

Take, for instance, his rally in Arizona for Kari Lake, where he had the audacity to say that under his watch the country “had the greatest economy in the history of the world with no inflation.” [!] Such nonsense needs no comment.

Like his boasts about the economy, the former president deftly left out his Administration’s role in the drastic rise in prices which Americans are currently suffering from.

First, however, the meaning of “inflation” should be explained.

Inflation, properly defined, as it was understood until the present era, meant an expansion of the money supply. “Deflation,” its opposite is a decrease in the money supply. The rise or fall in prices – usually a rise in producer and consumer prices – is a consequence of the expansion or contraction of the money supply. Once understood, the rampant rise in prices in America and throughout the world has been the result of the increase in the money supply not only by the Federal Reserve, but all central banks.

Another important tenet of monetary theory long since forgotten has been the notion of a “lagging indicator.” Between the expansion of the money supply – inflation – and the resultant increase in prices, there is often a lag which could take months or years to appear.

The increase in consumer and producer prices is due to the dramatic explosion of money and credit which took place during the Trump Administration not only in response to the scamdemic, but in the years leading up to it. In fact, the plandemic was a convenient excuse to inject massive liquidity into a system that began to hemorrhage in September, 2019. In the early months of 2020, the markets began to implode before the unnecessary lockdowns as the air began to come out of the financial bubble. This has been ignored by the financial press and Trump himself.

Prior to the covid hysteria, Trump had repeatedly lobbied for “cheap” money, calling for a renewal of quantitative easing, reduction in interest rates, and he even spoke about “negative” rates. The former president threatened to fire Jerome Powell, whom he had picked to head the Federal Reserve, for not reducing interest rates far enough. Trump complained that President Obama benefited from the Fed’s accommodative monetary policy and wanted similar treatment so as to keep the financial bubble going.

Trump’s fiscal policy was also highly inflationary as he ran record deficits long before covid. His tax cuts and failure to cut government spending led to greater government borrowing which the Fed was forced to monetize. Trump was on pace, well before the 2020 lockdowns, to spend more money in four years than Obama spent in his two terms. By 2019, the deficit had grown to $1 trillion dollars, up $205 billion, 26 percent from 2018.*** Again, all before covid had begun.

It was the Trump Administration’s wrongheaded response to the corona virus which is largely responsible for the rising prices of today. If the lockdowns were necessary (which a growing number of officials now admit they were not), the proper policy would have been to reduce the money supply (and government spending in general) since the lockdowns reduced production meaning less goods and employment. The massive increase in the Fed’s balance sheet from $4 trillion to some $9 trillion meant more money “chasing fewer goods” causing the prices of the available goods to increase – some dramatically.

What was needed was a reduction in consumer spending since there was less goods being produced with the lockdowns. Less demand would have offset the reduction in supply and would have kept prices from spiraling.

Instead, Trump – as did his successor – following the doctrines of Lord Keynes, attempted to maintain aggregate demand at pre-covid levels and sent out stimulus checks even to those still employed. While the money given out to American workers pales in comparison to the massive transfer of wealth to politically-favorite corporations, big business, and the expansion of the government itself, the propping up of aggregate demand led to supply chain shortages.

Trump is not alone in his ignorance of economics. His handlers, economic advisors, and the vast majority of his loyal supporters do not understand what took place under his administration. The current financial mess can be laid at his – and the Federal Reserve’s – feet. To be fair, his predecessor, Barrack Obama, is also liable.

The “inflation,” and now recession, which the country is suffering through cannot be fully attributed to the Biden Administration although it too has added to the crisis with more profligate spending.

The remedy for the current mess is not the re-election of a very flawed former president who does not understand the problem at hand and throughout his term was constantly outfoxed by the Swap which he was elected to drain. The solution is a return to sound money, the abolition of central banking, and the allowance for the necessary cleansing of the financial bubble. Until a presidential contender speaks in these terms, America’s financial woes will continue.

*https://www.zerohedge.com/political/heres-what-trump-says-inflation-would-be-if-he-were-still-president

**https://www.zerohedge.com/political/trump-blasts-biden-over-soaring-prices-says-true-inflation-rate-much-much-higher-91

***https://www.washingtonpost.com/business/2019/10/25/us-deficit-hit-billion-marking-nearly-percent-increase-during-trump-era/

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

America’s Trade Deficit: An Enormous Concern

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Another milestone (or more accurately millstone) was recently passed by the U.S. economy as the January trade deficit surged to an all-time record high of $107.6 billion, up some $26 billion from December’s $80.7 billion imbalance.*

Like the gigantic federal budget deficit, the trade imbalance is no longer talked about by the financial press. There has been little criticism of President Biden on either matter nor are Administration officials questioned about how things can be reversed. In fact, some commentators bizarrely contend that trade deficits show how robust an economy actually is!

The trade deficit was supposed to be alleviated by former President Trump who vowed throughout the 2016 campaign that he would rectify the situation and repeatedly ridiculed U.S. trade negotiators for their lack of financial acumen. He touted that his “friendship” with world leaders, most notably Chinese President Xi Jinping, would result in favorable trade deals for the country.

Trade hawks got on board with Trump’s economic nationalism believing that he would not only fix imbalances, but create an American industrial renaissance. Optimism ran high after his unexpected win in 2016.

As president, after a couple of contentious years of on-again, off-again negotiations a first phase of an agreement with China was signed in early 2018. During the negotiations, he boasted:

When a country (USA) is losing many billions of dollars

on trade with virtually every country it does business with,

trade wars are good and easy to win.**

In actuality, nothing significant was agreed upon with China despite the Trump Administration bragging that it was the first phase of a more comprehensive deal to come. Despite all of the hoopla, the trade imbalance continued to grow and no deal was ever finalized.

Besides the initial agreement with China, the next biggest trade policy act was the scrapping of NAFTA and its replacement with a new treaty, “The U.S.-Mexico-Canada Agreement” (USMCA). The new agreement was little different than the original treaty.

Thus, by the time he left office in 2020, the U.S.’s trade gap ($68.2 billion) was greater than during his predecessor, Barrack Obama’s term, who Trump lambasted for his ruinous trade policy.***

Trump wisely spoke little about trade during his unsuccessful 2020 re-election bid and, surprisingly, his opponents, despite the president’s miserable failure, steered clear of the issue. Of course, the Democrats were limited in what they could do with an obvious feeble, senile, and vile candidate at the top of their ticket.

Like the Democrats, Trump’s trade-hawk cheerleaders have remained reticent about the escalating trade numbers and like the former president they too, are now discredited when it comes to trade. If America could not overcome its trade gap with an economic nationalist as president for four years, then there must be a problem with their thinking.

The reason why Trump failed – as will Biden – is that he, his negotiators, and the trade hawks who supported him are ignorant of basic economics. The burgeoning trade deficits are not the result of bad trade deals or that of ineffective tariff policies, but are the result of a deteriorating U.S. economy which is no longer one of production, but of consumption and debt. A growing economy creates trade surpluses not deficits; it produces more than it consume.

Because of decades of anti-capitalistic economic legislation – confiscatory taxation, regulatory burdens, inflationary monetary policy, “crowding out” budget deficits, unemployment subsidies, minimum wage laws, and an overemphasis by the Establishment on higher education – the U.S. is no longer an industrial power and not a conducive environment for economic growth.

Because it possesses the world’s reserve currency, the U.S. has been able to offset its trade imbalances by importing goods in exchange for dollars. Even with this advantage, however, trade deficits have continued to grow. It appears that even its status as the possessor of the world’s reserve currency may be coming to an end as the dollar’s preeminence will fall with the surge in price inflation. This will have a devastating effect not only for the domestic economy but its foreign trade as well as the country will not be able to export dollars for goods in the future.

The burgeoning trade deficit is a far more accurate indicator of the health of an economy than GDP, unemployment figures, or the government’s “official” rate of price inflation. All these statistics are so manipulated that they do not come close to showing what is actually happening in the real world. The trade deficit is a more reflective gauge of an economy’s productive capacity.

That Trump posted the largest trade deficit in history also explodes his claim that under his watch, the U.S. had the greatest economy ever! How he calculated and supported such nonsense (which was not challenged by the financial press) is hard to maintain with trade deficits in the stratosphere.

When America’s economy was at its zenith, it was a creditor nation with trade surpluses and producing goods which were sold the world over. It had a high savings rate, a low inflationary environment, little public debt, and respect for private property, particularly the right for entrepreneurs to hire and fire whom they pleased. All socio-economic groups prospered from the free market and free trade, not just the 1%.

The trade deficit can be turned around, but not through bureaucratic state orchestrated deals which favor big business and multi-national corporations at the expense of American consumers. The proper trade policy is no policy at all, except the freeing of the economy from government intervention.

*https://www.reuters.com/business/us-goods-trade-deficit-hits-record-high-january-2022-02-28/

**https://www.reuters.com/article/us-usa-trade-trump/trump-tweets-trade-wars-are-good-and-easy-to-win-idUSKCN1GE1E9

***https://www.cnbc.com/2021/03/05/us-trade-deficit-january-2021.html

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

Pseudo Traditionalists

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Posted by editors 02-14-’22 Antonius Aquinas@antoniusaquinas https://antoniusaquinas.com

The January 6th “Insurrection” and the Epiphany

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One year ago a haphazard and foolish attempt was made by supporters of former President Donald Trump to disrupt a joint session of Congress which had assembled to formalize the victory of then president-elect Joseph Biden. Some Congressional offices were vandalized while Congress had to halt proceedings as representatives were evacuated and the Capitol building was put under a lockdown.

A number of the participants in the ransacking were arrested and even those who did not take an active part have been imprisoned and remain there to this day. Some of the right-wing groups, such as Proud Boys and Oath Keepers, have been fined and face further legal persecution.

The ease that protesters were able to gain access to the Capitol building, the lack of police response, and the number of agent provocateurs among the Trump supporters makes it hard not to believe that the entire affair was a sting operation. Trump played right into the scheme by calling for the rally on December 18, four days after the Electoral College had voted, “Big protest in D.C. on January 6^th. Be there, will be wild.” The build-up and encouragement by Trump and others gave U.S. intelligence agencies plenty of time to orchestrate a false flag.

What has been forgotten since the calling of the “Save America” rally by Trump and the government’s response to the ‘insurrection” has been that January 6^th is an important date in human history. January 6^th is the feast day of the Epiphany, the date that it was revealed to the gentile nations that the Messias had been born. “Epiphany” in Greek signifies “appearance” or “manifestation.”

The Magi – guided by the Star of Bethlehem – were led to Bethlehem to adore the Savior, bearing with them precious gifts. In fact, Epiphany has been traditionally a higher class of feast than the Nativity.

That Trump and his supporters most of whom consider themselves Christians decided to make their futile protests on the Epiphany instead of celebrating the day for its importance demonstrates why the world is in its present deplorable condition.

Until those who seek to halt the neo-leftist assault on what is left of Western culture which began in earnest with the election of President Trump in 2016 get their priorities straight, they will have little success against the forces that seek to destroy them.

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

“Inflation,” Properly Defined

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What Is Inflation in Economics? Definition, Causes ...

The use or rather misuse of language has always been an effective tool of politicians to enact their agendas. George Orwell’s “Politics and the English Language” brilliantly showed, in his day, how language was being manipulated for all sorts of totalitarian measures:

Political language — and with variations this is true of all political parties, from Conservatives to Anarchists — is designed to make lies sound truthful
and murder respectable, and to give an appearance of solidity to pure wind. One cannot change this all in a moment, but one can at least change one’s own habits, and from time to time one can even, if one jeers loudly enough, send some worn-out and useless phrase — some jackboot, Achilles’ heel, hotbed, melting pot, acid test, veritable inferno, or other lump of verbal refuse — into the dustbin, where it belongs.*

Since its publication in 1946, matters have only gotten worse. For example, in today’s parlance words such as “racism,” “discrimination,” “fascism” have lost all meaning and are usually used by the Left to smear its political opponents.

In the sphere of economics, examples abound of the misuse of terms and concepts all of which advance the interests of the politically-connected elites, technocrats, governments, and the banking establishment at the expense of everyone else. One of the most glaring examples which, after the financial collapse in 2020, has now become more prominent in daily life, has been the meaning of the word “inflation.”

Inflation, at one time, and properly understood meant an increase in the money supply; it did not mean an increase in prices. A rise in prices was and still is, the result of inflation.

The meaning of inflation, however, has been deftly misused by the world’s monetary lords to cover their own nefarious machinations. By deliberately changing the term it deflects the focus of their activities which can thus be blamed on others – greedy businessmen, oil cartels, workers demanding higher wages, etc.

Since central banks have complete control of the money supplies of the world, when inflation is properly understood its cause can be directly traced to them, which may lead to some inconvenient – for the banksters at least– inquires such as: “How did they attain such power and privilege?”

Redefining inflation has been done to disguise and shift focus away from the actual cause of what America and many economies of the Western world are now experiencing in the startling rise in both producer and consumer prices. This is the result of the central banks’ expansion of the money supply to mind-boggling proportions purportedly to fight the corona plandemic, but in reality it has been done to offset the financial implosion which began in late February/March of 2020 before the unnecessary and destructive lockdowns began. The lockdowns and closing of the economies gave cover for the Federal Reserve and central banks to create vast amounts of money and credit to salvage, and then re-inflate a bubble in the stock and asset markets.

An accurate account of the matter will show that the financial collapse of the system really began in the fall of 2019 as the “repo” market began to meltdown, causing the Fed to intervene with injections of “liquidity” to keep interest rates from spiking. However, just like the meaning of inflation has been corrupted, so has the narrative of the financial collapse of 2020 been purposely skewed.

As a separate discipline, economics developed in large part in reaction to British Mercantilism of the 18^th century. Economic theory was used by authors such as Adam Smith in his Wealth of Nations to debunk the system of regulations, taxes and subsidies that the British government imposed. Such economists, as did later schools of thought, most notably the Austrians, used economic thinking and its terms to expose the baneful effects of government intervention, fiat money, and the benefits of free trade.

Over time, however, most economists became corrupted and instead of acting as a check on state power, became champions of regulation, central banking, and all sorts of social engineering schemes. Economists were paid for their sell out with cushy positions and jobs in the state apparatus to manipulate language and doctrines.

Today, an inflation rate of 2% is regarded by Fed officials as good for the economy and something monetary policy should try to achieve. Previously, a rise in prices of 2% was seen for what it was – a loss of purchasing power hurting the middle and lower classes the worst while benefiting the wealthy.

For those who seek to rid economics or, for that matter, all the social sciences of deliberately misleading language and terms, George Orwell’s works are indispensable. It is, therefore, incumbent for truth seekers of all persuasions to do so not only for their own benefit, but to maintain the sage author’s legacy.

*https://libcom.org/files/Politics%20and%20the%20English%20Language%20-%20George%20Orwell.pdf

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

A Look Back at Nixon’s Infamous Monetary Decision

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A half century ago one of the most disastrous monetary decisions in U.S. history was committed by Richard Nixon. In a television address, the president declared that the nation would no longer redeem internationally dollars for gold. Since the dollar was the world’s reserve currency, Nixon’s closing of the “Gold Window” put the world on an irredeemable paper monetary standard.

The ramifications of the act continue to this very day. America’s current financial mess, budget deficits, the reoccurring booms and busts, the decline of living standards (particularly the middle class), all have their genesis with Nixon’s infamous decision in August, 1971.

Abandoning the last vestiges of the gold standard was the culmination of a long-term goal of the banksters, politicians, financial elites, and deceitful economists. The first step was the establishment of the Federal Reserve in 1913 whose primary purpose was to allow its member banks to inflate the money supply without fearing the consequences – bank failures/panics, bank runs, recessions/depressions. The Fed could, and still does, through the control of the money supply enrich itself, the government, and its aligned financial elites at the expense of the public at large.

The next step on the road to monetary debasement was Franklin Roosevelt’s draconian measure of outlawing the private ownership of gold. This was not only an unprecedented and outrageous attack on private property, but it also eliminated gold redemption of dollars domestically, which gave the Fed unlimited power to print money without fear of its notes being redeemed.

The specious justification for the law, enacted shortly after the start of FDR’s first tyrannical term in office, was to fight the Great Depression. Of course, the measure did nothing to mitigate the Depression which, in fact, was not caused by Americans’ ownership of gold, but rather the Fed itself and its wild inflationary policies throughout the “Roaring 20s.”

FDR’s action, like Nixon’s, demonstrated how much the power of the presidency had expanded. It shows again the flawed and frankly naïve argument put forth by Constitutionalists and conservatives of every ideological persuasion that the celebrated “separation of powers” theory that supposedly checks the aggrandizement of federal power could not prevent the audacious acts of FDR and Nixon. Despite what is taught in social sciences courses, a true gold standard is a greater protector of individuals’ economic well being and, ultimately, their political liberty than any legislation, bills of rights, or constitution ever penned. Hard money limits state power!

The primary reason why President Nixon closed the Gold Window was to fund the nation’s “guns & butter” economic and social policies which had begun under his predecessor Lyndon Johnson. Johnson’s “War on Poverty” and his escalation of the war in Vietnam caused the Fed to print vast amounts of money which began to drain the Treasury of gold.

While U.S. citizens and financial institutions could not redeem dollars for gold, foreign central banks could. The U.S.’s inflationary policy to fund its domestic and foreign objectives was why the Gold Window was closed. In effect, the U.S. was reneging on its commitment which had been in place since Bretton Woods. It was not as President Nixon announced as part of his new economic policy initiative entitled “The Challenge of Peace,” “to take action necessary to defend the dollar against the speculators.”* Instead, it was the type of monetary chicanery that banana republic’s often pursue.

Culturally, the eradication of hard money was part of the transformation of a mature, frugal, hardworking, and future-oriented people into an infantile, self-absorbed, dysfunctional, and hedonistic collection of individuals. While many consequences of this change could be cited, one of the most telling is that America has gone from a creditor nation (in 1971) to a debtor nation within a couple of generations. Not only has the national debt exploded (which now exceeds $30 trillion!), but personal and corporate debt are at dizzying heights.

At this point, a reversal of President Nixon’s decision would do little to confront the immense problems which the U.S. economy faces. A “Great Reset” of the economic system is in order, but not the kind envisioned by the world’s financial elites.

An honest-to-goodness reset would begin with a return to a metallic monetary standard where all national currencies would be redeemable in gold/silver. Such a move would put a real check on banks’ ability to create money “out of thin air.”

The return of prosperity will only come about when gold is again a part of the monetary order and reasserts its critical role in the limitation of central bank power.

*Richard M. Nixon, “Address to the Nation Outlining a New Economic Policy: ‘The Challenge of Peace.’” The American Presidency Project. 15 August 1971.

https://www.presidency.ucsb.edu/ws?pid=3115

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

Gold and Latin: Twin Pillars of Western Rejuvenation

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Gold Coinage of the Latin Monetary Union

After Brexit, there has been a growing number of voices within the European Union and among various nationalistic groups arguing that English should be replaced as the official language since now only Ireland and Malta retain English.

The loudest quarter calling for a change has come from the French who, not surprisingly, want their own tongue to become the lingua franca of the EU. Eric Zemmour, a French conservative commentator, asserts, “I think this is the time to launch a counter-offensive in favour of French, to recall that French was the original language of EU institutions.”*

A return to French, however, has its difficulties with other nationalist groups particularly those from the EU’s dominant economic power, Germany.

An interesting and most logical solution to the seemingly intractable problem has been suggested by an article in the magazine Le Figaro,** which calls for a return to Latin as the EU’s lingua franca.

Why Latin?

A return to Latin makes the most sense since the Romance languages of the EU nations – Italy, France, Spain – developed out of Latin, and the Germanic tongues contain a large amount of Latin words in their vocabularies. It would thus be relatively easy to bring back Latin as an international language.

Latin has a long and successful history stretching back to Antiquity as the language of law, commerce, science, and religion. Latin fostered social cohesion among ethnic groups and cultures while it facilitated the exchange of ideas and customs.

While Latin is par excellence a lingua franca, an international monetary system based on gold would accomplish many of the same benefits for the economies of Europe (and for that matter the world) that Latin has done for communications and interrelations. Many of the same arguments which have been applied to Latin can be used for a metallic monetary order.

Why gold?

A one-world commodity standard allows for integration and the extension of the division of labor since all prices are expressed in terms of gold/silver. Costs, too, would be calculated in terms of one general medium of exchange which makes economies more efficient. National currencies, fully backed and redeemed in gold, would do away with the cumbersome exchange ratios which currently exist.

Just as important, a monetary order based on a gold standard would make it extremely difficult for governments and central banks to inflate the currencies which ultimately leads to the dreaded boom and bust cycle. The inability to create “money out of thin air” would reduce governments’ debt-creation powers since central banks could no longer monetize debt by simply printing money and expanding credit.

With an inexhaustible supply of paper money that can fund and underwrite any state project, government power and control over the economy and social life has grown exponentially once the gold standard was eliminated. A world on a gold standard would reduce state power. The vast social engineering schemes and war making capacity have been made possible through unrestrained money printing and debt creation.

If the nations of Europe would adopt a gold standard, it would attract foreign capital since creditors would be assured that their investments would not be debased through inflation. Domestic savings, too, would sizably increase which would generate an authentic economic boom based on wealth generated not by money printing, but through the abstention of consumption – savings.

Gold and Latin are both “natural” mediums which do not require state largesse and involvement for their use. Artificial monolithic political constructs like the EU and monetary institutions like the IMF and World Bank, which are nothing less than engines of inflation, are unnecessary under a monetary order based on gold.

It would be difficult to deny that gold and Latin did not possess Providential qualities. The amount of gold in the world and its inherent qualities have made it the “perfect” medium of exchange. Its supply is not too plentiful nor too scare while its qualities – durable, portable, divisible – satisfy all the qualities that a money requires.

That Rome and its language would rise and become the greatest empire to have existed which paved the way for the spread of Christianity and the development of European civilization is not by happenstance. Latin bounded Rome and its provinces together no matter how far apart geographically and culturally. Some authors have noted that the appearance of the Savior came at the time of the Pax Romana – “the Roman Peace” – which provided the perfect conditions to accomplish His mission.

While modern man vainly seeks to create unity through the dictates of the State with its countless laws and regulatory agencies to enforce them, there exists institutions and gifts of nature which if used can provide a natural universality. For a just social order to be attained, the most sublime human language must once again return to its place of prominence while the most honest and efficient money ever used must again become the world’s general medium of exchange.

*Tyler Durden, “French Call to Replace English with Latin as Europe’s Official Language,” Zero Hedge, 17 March 2021. https://www.zerohedge.com/geopolitical/french-call-replace-english-latin-europes-official-language

**https://www.lefigaro.fr/vox/culture/et-si-la-langue-officielle-de-l-union-europeenne-devenait-le-latin-20210208

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com

Can Feudalism Save the Western World?

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Late Medieval France

It is both surprising and infuriating that many conservatives, libertarians and those on the Right describe today’s political and financial order as “neo-feudalism.”(1) Surprisingly, because many of these commentators are trained academics(2) who should know better and infuriating, since feudalism and the glorious age which it reigned – the Middle Ages – if rightly understood and not denigrated could provide a paradigm for the reconstruction of the present social order after its inevitable collapse.

Many compare today’s political and economic configurations of vast wealth disparity and totalitarian democratic nation-states whose latest, and probably most egregious, abuse of power has been the lockdowns and compulsory face-mask edicts to combat a supposed deadly virus, with the conditions which existed under feudalism.

This is false.

Feudalism, and for most of the era which it existed, was characterized by political decentralization with little financial concentration of wealth.

Feudalism can be described as an arrangement between lords and monarchs with their underlings – vassals, dukes, earls, princes, counts, marquises, knights – in exchange for services. “Feudal tenure, whatever its minor adaptations,” writes medieval historian Carl Stephenson, “was essentially military because the original vassalage was a military relationship.”(3)

In return for military service, the vassal would receive a “fief” in the form of land, money, goods, or other benefits. “[A] fief,” Stephenson describes, “was the special remuneration paid to a vassal for the rendering of a special service.”

The relationship, unlike what modern commentators would have many believe, was not one-sided. While the vassal swore allegiance to his lord, the latter was obligated to provide his vassal with agreed upon “payment.” If the lord failed to fulfill his obligation, the vassal was free to break the agreement and find another lord.

The vassal, to receive his due from the lord, had to “faithfully give aid and counsel so that in every way the lord may be safeguarded as to person, rights, and belongings,” while the lord “has a reciprocal duty towards his faithful man. If either defaults in what he owes the other, he may justly be accused of perfidy.”(4)

The feudal relationship between lords and vassals had immense consequences – mostly positive – for medieval life. It helped shape the social order which impacted all aspects of society such as law, the political order (such as it was), war-making, and economics. The arrangement between lord and vassal was not really “political” as in the modern sense; it was more of a “contractual relationship” than that of power.

Lords and vassals and, for that matter, monarchs, did not create law or legislation but were subjected to the (natural) law. There was no monopolistic justice system, but a number of courts which were for the adjudication of disputes where cases could be appealed to different courts for redress. The myriad of public legislation regulating every aspect of modern man’s life, where most laws are not even read by legislators until they are enacted was, happily, not a feature of the Middle Ages. Law had to be “discovered” and based on custom and tradition in which all sectors of society had to abide by.

The feudal arrangement between lord, monarchs, and their vassals, where all had to live according to the law resulted, throughout the Western world, in a diffusion of power. Professor Stephenson illustrates how this effected France for centuries:

France, obviously, had ceased to be a

state in any proper sense of the word.

Rather, it had been split into a number

of states whose rulers, no matter how

they styled themselves enjoyed the

substance of the regal power.(5)

The idea and reality of monarchial absolutism, which characterized the early modern era and which nation states would build upon for their own aggrandizement, was not part of the medieval period. In many areas, authority was held by dukes, princes and earls not based on political power, but one of trust, loyalty and contract.

The most vilified institution of the Middle Ages was serfdom. Yet, compared to the present epoch where the working classes are largely indebted, have had their individual liberties curtailed, and now many are dependent on the welfare state for their financial survival, could serfdom be worse? Charles Coulombe contrasts:

The serf, like laborers everywhere and

at all times, had a hard life. He also could

not be forced off the land, worked about

30 days a year for his lord (as opposed to

the average American’s 167 for the IRS),

and could NOT work on Sundays and the

30-odd Holy Days of obligation and certain

other stated times. One may compare that

to any current job description one wants to.(6)

The amount of taxation and its legitimacy in a society is ultimately determined by ideology. And, the ideology of the era frowned on taxation and those that were laid were done so grudgingly. It was the institutional framework of feudalism which limited taxation to the benefit of the social order.

Private property was considered sacrosanct and the violation of it an egregious offense. In the medieval world, taxation was a “sequestration of property” which the monarch only had the right to tax when it had “become traditional.” “The rights to property possessed by every individual member of the community,” according to historian Fritz Kern, “are an absolutely sacred part of the whole absolutely sacred legal order; the criterion of the rights in property of the individual as well as of the State is the good old law.”(7)

Kingship and Law in the Middle Ages: I. The Divine Right of Kings and the Right of Resistance in the Early Middle Ages. II...

While many other passages could be cited, the existence of state power in feudal times is almost the polar opposite of the political situation which exists in the world today. It is inconceivable that the draconian measures taken by governments in response to the phony pandemic, which has ruined countless lives and allowed monetary authorities the world over to assume unseen power and control, could have never taken place during the Middle Ages.

Instead of naming the current age “neo-feudalism” it is far better categorized as “neo-Progressive,” a term which describes the era of American history at the beginning of the 20^thcentury. The Progressive Era, despite the façade of supposed regulation of Big Business, was really the start of American corporativism – a cozy alliance between the State and Big Business to protect the latter, especially the financial sector, from competition. Each successive generation saw this alliance become stronger leading to today’s situation of mega bailouts for the 1% at the expense of the middle class.

The learned detractors of feudalism who mischaracterize it are doing a great disservice to those who are seeking solutions to the myriad of social and economic crises which the Western world faces. The prime lesson that can be gleaned from feudalism is the diffusion of power. Attempts at reform of the current totalitarian democratic social order or the creation of alternative political parties to challenge the entrenched, corrupt, political order will result in failure.

Instead, all activities, movements, and more importantly, intellectual arguments should be directed toward the break-up of the nation state. Brexit, the recent victories of pro-independence parties in the Catalan elections, and the nascent Texas secession movement – TEXIT – should be encouraged and supported.

Happily, the pages of history provide a paradigm of a decentralized social order which thrived for nearly a millennium. Instead of bashing it, feudalism should be embraced and its principles incorporated into modern political discourse.

(1) The latest smearing of feudalism can be seen in Charles Hugh Smith, “The Coming Revolt of the Middle Class,” Zero Hedge, 28 January 2021.

(2) As an example, see Paul Craig Roberts, “Are We Brewing a New Feudalism?” Paul Craig Roberts Institute for Political Economy. 16 April 2020.

(3) Carl Stephenson, Mediaeval Institutions: Selected Essays, ed. Bryce D. Lyon (Ithaca, NY.: Cornell University Press, 1954, Cornell Paperbacks, 1967), 217.

(4) Carl Stephenson, Mediaeval Feudalism, 4^th ed. (Ithaca, N.Y.: Great Seal Books, 1960), 20.

(5) Stephenson, Mediaeval Feudalism, 78.

(6) Charles Coulombe, “”Monarchist FAQ.” Tumblar House.

(7) Fritz Kern, Kingship and Law in the Middle Ages, trans. S.B. Chrimes (New York: Frederick A Praeger Publishers, 1956), 186.

Antonius Aquinas@AntoniusAquinas

https://antoniusaquinas.com