Tag Archives: Great Britain

Charles A. Beard, “American Foreign Policy in the Making, 1932-1940″*

Review: Charles A. Beard, American Foreign Policy in the Making, 1932-1940: A Study in Responsibilities.  New Haven: Yale University Press, 1946.

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Introduction

Last year, 2016, marked the 70th anniversary of the publication of Charles Beard’s masterful study of United States foreign policy prior to the nation’s disastrous entrance into the Second World War, American Foreign Policy in the Making1932-1940: A Study in Responsibilities(AFPM).  The book was soon accompanied by President Roosevelt and the Coming of the War, 1941 published in 1948, the year of the great historian’s passing.

The two volumes were extremely influential and became cornerstones of World War II revisionism.  AFPM chronicled US policy in the crucial decade prior to the fateful attack at Pearl Harbor on December 7, 1941.  The records released and the research done in the decades following Beard’s studies have only substantiated the historian’s interpretation of events.*

The most recent of the growing literature of WWII revisionism has been by the German historian Gerd Schultze-Rhonhof, and his provocative book, The War That Had Many Fathers.**As Beard did with AFPM, Schultze-Rhonhof seeks to assign responsibility for the outbreak of WWII in the European theatre.  Like Beard, and in contrast to the official historical interpretation, Schultze-Rhonhof blames the provocative actions of the “Allied” governments in the years leading up to the conflict.***

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Antonius Aquinas@AntoniusAquinas

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*This essay is dedicated to the late Charlie McGrath of Wide Awake News.

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Donald & the Dollar

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John Connally, President Nixon’s Secretary of the Treasury, once remarked to the consternation of Europe’s financial elites over America’s inflationary monetary policy, that the dollar “is our currency, but your problem.”  Times have certainly changed and it now appears that the dollar has become an American problem.

In a recent interview with the Wall Street Journal, the soon to be 45th President of the United States believes that the greenback’s strength – up some 25% against a broad basket of currencies since 2014 – is now “too strong,” “killing us,” and has hurt companies trying to compete overseas.* A top Trump economics advisor, Anthony Scaramucci, reinforced his boss’ sentiment adding that “we must be careful of a rising dollar.”

Apparently, making America great again does not include the nation’s monetary standard.  Trump’s belief that the dollar is too strong also shows a distinct lack of historical understanding.  Every great nation and empire (which Trump promises to restore America to) had a sound monetary system.  It is no coincidence that the pound sterling was the world’s “reserve currency” at the time when the British Empire was at its height.  Debasement of it to finance Britain’s insane decision to enter World War I led, in large part, to the eventual loss of its empire.  If Trump truly seeks to restore American greatness at home and its prestige throughout the world, devaluating the currency is not the way to go.

Nor does a weakened dollar benefit the middle class whom the president elect throughout the campaign has pledged to help.  In fact, it has been the fall in the purchasing power of the dollar due to the inflationary policies of the Federal Reserve which have decimated the living standard of the middle class.  And, while the proposed Trumpian middle class tax cuts will help, just as important is a sound monetary system if Middle America is to become a creditor class once again.

Pensioners and retirees, another group that Trump has promised to help, would continue to see their financial condition decline under a policy to weaken the dollar. A fall in the purchasing power of money would devastate the income stream of pensions and social security payments.

While a weaker dollar policy would hurt the middle class, retirees, and savers, it would benefit the most responsible for the continued economic doldrums of America – banksters and the government.  A weaker dollar would allow the government to continue to borrow and maintain its profligate spending.  Financial houses and the banksters would receive credit at nearly zero cost which would allow them to continue to blow bubbles in the asset markets.  Export firms, too, would benefit at least for a while, but would more than likely face retribution from foreign governments and central banks which would retaliate with their own devaluations sparking potential currency wars.

Talk of “currency manipulation,” “weakening the dollar,” “trade deals,” and the like do not address what lies at the heart of not only America, but the Western world’s economic problem – too much debt.  The reason why the West has been able to incur its current gargantuan level of debt is not because of a “weak” or a “strong” dollar, but because the dollar is a fiat currency not backed by any commodity.  A true gold standard, where each currency unit represents either gold or silver, provides monetary discipline which prevents politicians and banksters from incurring ruinous levels of debt.

Since money is the lifeblood of an economy, any hope that one can be turned around without a stable monetary order is, to say the least, delusional.  If president-elect Trump and his policy makers do not realize this, they will be severely disappointed in the years to come.  Sound money allows for the accumulation of savings and capital formation, the essential elements of the market economy and the only basis upon which real economic growth can occur.  More savings and capital are needed to boost production and create employment, not supposedly wiser and more competent international trade negotiators.

Talk of currency devaluation is what is typically heard from banana republics, it should not be advocated by those who have aspirations of making their country great again.

*Tyler Durden, “Dollar Tumbles After Trump Calls Currency ‘Too Strong,’ Slams Border-Adjustment Tax.”  Zero Hedge.  17 January 2017.

Antonius Aquinas@AntoniusAquinas

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