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The Founders Warned Us About Central Banking
The Federal Reserve just lowered interest rates for the second time this year and announced more quantitative easing by injecting even more US dollars into the market. The days of cheap money will soon come to an end, and I fear that many people won’t realize what’s happening until the rug is pulled out from under them.
As economist Henry Hazlitt wrote, the practices of the Fed distort the real-world market indicators of cost, future prices, investments and production. A recent study from the National Association for Business Economics showed that 72% of economists now predict that a recession will occur between 2020 and the end of 2021. Some have even warned that the US is on the brink of the biggest bubble in world history — not just a correction of a business cycle or another recession, but a complete collapse of the US dollar.
Yet the dangers of centralized banking are not new knowledge. For centuries, people — including many of our founding fathers — have tried to warn us of the numerous threats posed by institutions like the Federal Reserve.
Today, it’s understood by many that the recklessness of the Fed allowed for the subprime mortgages that caused the Great Recession of 2008. With over $22 trillion in debt, $120 trillion in unfunded liabilities, and, soon, an all-time high debt-to-GDP ratio (comparable to World War II levels), however, it’s not overstating it to say that the Fed-facilitated out-of-control federal government spending constitutes the greatest threat to the American way of life in history.
To understand the full extent of the debt and the destruction of the dollar, it’s essential to realize that paper money has a history of being printed as bills of credit to finance runaway government. In 1775, the founders attempted to use paper money without gold or silver backing, and they found that the inflation robbed them of any value.
In 1788, Thomas Jefferson wrote:
The Coinage Act of 1792 then set specific ratios for gold and silver coinage, placing gold and silver in control rather than a central bank. This lasted until the passage of the Federal Reserve Act of 1913, which allowed for the formation of the Federal Reserve System just two decades before Pres. Franklin D. Roosevelt started to come after private ownership of gold and silver in the 1930s. In 1944, the Bretton Woods system made the US dollar the reserve currency of the world, when it was still partially backed by gold and silver.
Finally, in 1971, the Nixon Administration suspended wages, issued price controls, and canceled dollar-to-gold convertibility, completing the final step in ending the “gold standard.” This gave the central government planners — and the federal reserve — the power to print money without restraint. This is how the national debt has been able to reach the levels that it has. The only thing backing the US dollar today is public debt.
Remember when Coke was a nickel? In 1913 (the year the Fed was founded) a bottle of Coke cost five cents. Today, a bottle of Coca-Cola costs an average of $1.79. While there are many factors (like supply and demand, cost of goods, etc.) that help set prices, inflation plays a critical part. At an average inflation rate of 3.12% annually, inflation alone accounts for $1.30 of the actual cost of Coke.
The addition of more US dollars doesn’t mean that anyone is more wealthy; in fact, it means that the dollars you have are worthless. You will need a higher amount of dollars to buy the same goods and services. Hence, saving inflated dollars, in many cases, is losing value. Those who save money are being robbed.
With the continued decline of the dollar, there could also be hyperinflation on an unprecedented scale. Both James Madison and Thomas Jefferson warned that “the greatest threat to be feared” was the “public curse” of “public debt”, and that “banking establishments are more dangerous than standing armies.” The founding fathers understood the dangers of centralized manipulation of the money supply, the hidden taxation of inflation, and the control of buying power.
Furthermore, if we look at the history of money, we can see that precious metals, mainly gold and silver, have been used for coinage for over 2600 years; in one way or another, gold and silver have been used by people for over 6.000 years.
American revolutionary leader Christopher Gadsden said in September 1764:
People across the US should heed his warnings by allowing gold and silver to be used as legal tender once again. Some states like Utah have done just that. While this won’t stop the Federal Reserve’s destruction of the dollar, it will allow people to convert dollars to sound money before a collapse. Sound money, like gold and silver, acts as a check and balance on big government, a hedge against inflation, and a way to combat manipulation by the Fed.
This is exactly why, in my home state, I will soon be filing the “2020 South Carolina Sound Money Bill,” allowing South Carolinians to use gold and silver as legal tender. I will also introduce legislation to exempt gold and silver from capital gains tax, both of which are already exempt from sales tax in South Carolina. We the People can restore sound money by using the Ninth and Tenth Amendments to the US Constitution.
It is my hope that, with the success of these bills, other policymakers elsewhere will become inspired to lead by example on this vital issue as well. The key to protecting the American way of life from the federal reserve’s obliteration of our currency rests with the legislatures, but we must heed the lessons of history now.
Slog PM: Three-Alarm Fire in Ballard; Fancy Anti-Sawant Sign in D3; Ballard P-Patch Wants Some of That Sweet, Sweet Soda Tax MoneyCache
by Chase Burns
McConnell bucks Trump: Today, Trump announced he would pull US troops from northern Syria. The announcement, sponsored by Trump's "unmatched wisdom," brought chaos to Washington.
Republicans and Democrats sorta united in their criticism against Trump: McConnell said the move would cause "a precipitous withdrawal of US forces from Syria [that] would only benefit Russia, Iran, and the Assad regime." He continued: "Major new conflict between Turkey and our partners in Syria would seriously risk damaging Turkey's ties to the United States and causing greater isolation for Turkey on the world stage." TRUMP, BABY, WHY ARE YOU DAMAGING ALL YOUR RELATIONSHIPS? (Is it because Putin's got that pee-pee tape?)
Warren is going off about Facebook and Trump: In related news, Washington state is going after Facebook again for failing to disclose details about the local political ads it sells in the state.
The Impossible Burger is the "Lizzo of the plant-based food market": Impossible Burger, meet the Impossible Comparison.
These retired gardeners aren't fucking around: The Ballard P-Patch is so popular that it has a two-year waiting list. Now, the garden is threatened by potential redevelopment and must raise funds to stay on the property: up to $2 million, reports the Seattle Times. They've raised approximately $49,000, which isn't close to $2 million. But the people are not afraid. They think they can get some of that $3 million the soda tax raised to save their P-Patch. (Unlikely.) I especially liked this passage from the Times report:
Three-alarm fire in Ballard: A major fire broke out in the heart of Ballard on the corner of Northwest Market Street and 24th Ave this afternoon, with firefighters coming from around the city to battle the blaze for over three hours. A total of ~150 firefighters fought the fire, getting it under control by about 3:30 p.m. Several businesses—La Isla, Pho Big Bowl, Supercuts, Kitchen N Things, and Octo Designs & Jewelers—were severely impacted by the fire. "All five businesses were expected to be a total loss," a Seattle Fire Department spokesperson originally told the Seattle Times, although now it looks like Pho Big Bowl may be somewhat saved. Crews are expected to stay at the site overnight to make sure the fire doesn't start up again. The Times has more coverage of the fire here.
One of The Stranger's Tech-Savvy/At-Risk Youth lives near the fire and sent us an update: "All the hydrants in use have stirred gunk up in the water main; this is what's coming out of my faucet right now." A pic:
Ew: Sorry, Grant!
Trump must reveal his tax returns: A federal judge has rejected Trump's attempt to prevent Manhattan state prosecutors from reviewing his tax returns. His returns are still protected, however, for now. "His lawyers quickly appealed to the Second Circuit Court of Appeals in Manhattan, which agreed to temporarily delay enforcement of the subpoena while it considers arguments in the case," writes the New York Times.
Rainbow crosswalks are hitting the nation: But the federal government is asking cities to get rid of them, suggesting they're unsafe. A letter sent by the Federal Highway Administration reads that the gay-ass crosswalks diminish "the contrast between the white lines and the pavement, potentially decreasing the effectiveness of the crosswalk markings and the safety of pedestrian traffic.” But urbanists are saying this is bullshit. (Mr. Pence, I think you have bigger things to worry about right now??)
Landlords are worried they may have to pay the price now that WeWork is crashing: Two London landlords told the Financial Times they're creating backup plans for when the company goes down in smoke. (Too soon?) "It would not be prudent for us to do anything [new] with them until we see how the new management will operate," said one landlord. Meanwhile, we over here in Stranger World Headquarters are patiently eating popcorn and waiting to see what will happen with the half-empty mega WeWork office being built next door to us.
This gender reveal video is really funny: My gender is also an intangible black balloon. (Black Balloon, by the way, is the name of a movie that stars Toni Collette.)
[Daily Trust] The Nigeria Labour Congress has urged the Federal Government to conclude the negotiations for the consequential salary adjustment of the N30, 000 new national minimum wage so that all workers would have a reason to smile at the end of this month.
[Premium Times] The Nigerian Supreme Council for Islamic Affairs (NSCIA) has urged the Federal Government to take concrete steps towards reversing the ugly trend of kidnappings and banditry in the country.
OTTAWA—After a chaotic six-way election debate, are you left hungry for substantive answers from the parties?
With no knockout blows and a format that left lots to be desired, it was hard going if you were a voter.
But the outcome of the Oct. 21 federal election will lead to a new government one way or another. It will be formed either around a majority cabinet or perhaps by a coalition that would support a minority government, even if on an issue-by-issue basis.
So what might the first six months — the legislative session from January to June 2020 — of a new government look like?
The Star does some crystal-ball-gazing to guide you, assuming — as all public polls suggest is the case — the most likely scenario is a majority Liberal or Conservative government, or a minority government.
Today, climate change and the environment.
Under a Liberal government, the federal carbon price will go up in April 2020, from $20 a tonne to $30 a tonne (or about 7 cents a litre of gasoline).
Starting in January, the fuel levy portion of the price will apply in Alberta, along with the four other provinces — Ontario, New Brunswick, Manitoba and Saskatchewan — where the pricing system as a whole is in place.
At tax time, most of the money collected from the levy — 90 per cent — will be rebated to households in those provinces. In Ontario, the projected rebate for a family of four will rise from $307 in 2019 to $451 as the price jumps to $30 per tonne.
Meanwhile, heavy emitters — the oil and gas sector, mining, cement, and more — will start paying by mid-2020 through an “output based pricing system” that sets standards for each major industry. Most sectors have standards set at 80 per cent of average emissions intensity in their industry. Those that emit more than the standard will pay; those that emit less can sell credits to peers.
The Liberals plan to bring in regulations — delayed by three years in 2017 — to restrict methane emissions from oil and gas operations, starting in January.
In the early months, the government would continue public consultations on clean fuel standards for transportation, home heating, and industry. But the full standards won’t be in place until 2023.
The Liberals propose a 10-year tree-planting program and may begin budgeting funds — say about $300 million a year — in the spring. The party says it would cut corporate income taxes in half for clean tech businesses; give Canadians interest-free loans and grants to retrofit homes or build new ones that are carbon neutral; and pass a law to ensure workers transitioning out of the fossil-fuel sector are supported and retrained for new jobs.
The party could set up its promised expert panel to guide Ottawa on five-year plans to reduce emissions so that Canada does even better than its targeted reductions under the international Paris Agreement — 30 per cent below 2005 emission levels by 2030 — and achieve carbon neutrality by 2050.
There would be no immediate ban on single-use plastics. Trudeau has said the Liberals’ proposed ban won’t kick in until “as early as” 2021.
The first thing a Conservative government led by Andrew Scheer would do is scrap the federal carbon price. He would ditch the Liberal’s incoming fuel standards and replace them with something the party hasn’t yet described.
Together, those two measures were projected by the federal government to reduce emissions by at least 70 or 80 million tonnes per year by 2030 — about a third of what Canada needs to slash from 2005 levels to hit the Paris target. It’s unclear how the Conservatives would achieve those reductions, although Scheer says his plan is at the least Canada’s “best chance” of reaching its Paris goal.
The Conservatives would replace the federal carbon price with a requirement to pay for emissions that only applies to heavy polluters. Facilities that pump out more than 40,000 tonnes of greenhouse gas per year would pay unspecified amounts into clean technology research and development. It is unclear how much large emitters will be required to pay, starting when, or how many megatonnes of GHGs are targeted for reduction. So it’s impossible to say how stringent — or effective — this will be.
The Conservatives promise a tax credit worth up to $2,850 for greener home renovations, a $230-million green technology innovation fund for the private sector, and tax refunds on income generated from green tech patented in Canada. There is no timeline for these policies. But we might expect some answers in a Conservative budget in the spring.
In order to meet Canada’s Paris targets, the Conservatives would try to convince other countries like China to give Canada credit for emissions reductions that result from the replacement of heavy-polluting energy sources like coal with cleaner energy imports from Canada, like liquified natural gas.
A MINORITY SITUATION
On climate change, every party but the far right People’s Party agrees that climate change is a real, and human-caused challenge that needs to be taken seriously.
A Liberal minority could seek support from the New Democrats or Greens or even the Bloc Québécois — but these parties say Justin Trudeau would have to up his environmental game.
That’s because the NDP and the Greens have promised more stringent, legislated, emissions-reductions targets, in line with what scientists say is required to limit warming to 1.5 degrees C.
The NDP and the Greens back a price on carbon emissions. But they’d be tougher on major industrial polluters, however in different ways, and the Greens are the only party that
pledged to keep hiking the carbon price $10 per year beyond 2022, when it hits $50 per tonne.
The NDP and the Greens oppose the Liberals’ approval and expansion of the Trans-Mountain pipeline, but only Green leader Elizabeth May has said it’s a deal-breaker for a minority government.
The Greens want to stop all oil and gas imports to Canada and end all new fossil fuel development, including the $40-billion liquid natural gas megaproject approved last year on B.C.’s coast, as well as a national ban on fracking.
While it’s hard to imagine the Liberals agreeing to these more aggressive measures in the short term, Trudeau’s team agrees with the NDP and Greens on the push for zero-emissions vehicles (ZEVs). All three parties are pushing subsidies to encourage the purchase of ZEVs, as well as targets to ensure they make up a larger and larger share of annual vehicles sales in the coming years.
A Conservative minority government would likely struggle to find a party to support its climate plan.
The NDP has already ruled out supporting Scheer based on his failure to support LGBTQ rights, and the Greens say they would only support a party with a real climate action plan.
However, there could be some areas of agreement. The Greens and the Conservatives both propose national energy retrofit programs for residential and commercial buildings, for example. They also have proposed creating an “energy corridor” that would serve as a cross-Canada right-of-way for energy transmission — though Scheer envisions oil and gas pipelines along the route, while May is unequivocal that all energy for Canada’s electricity grid needs to be fully renewable by 2030.
Tonda MacCharles is an Ottawa-based reporter covering federal politics. Follow her on Twitter: @tondamacc
Alex Ballingall is an Ottawa-based reporter covering national politics. Follow him on Twitter: @aballinga