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Founded in 1953 by Isaiah L. "Si" Kenen, AIPAC's original name was the American Zionist Committee for Public Affairs.
Will The Federal Reserve Create The New Socialist Man?
By Karen De Coster and Eric Englund
Posted on 6/26/2006
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"Government cannot make man richer, but it can make him poorer." – Ludwig von Mises
Personal character and money are linked. No, we are not implying that a person of great wealth is necessarily an individual with high character. All one needs to do is look at the moral sewer known as Wall Street in order to comprehend how a whole host of elites have traded their souls for mind-boggling sums of money.
The linkage between character and money has everything to do with self-ownership. Aside from one's body, the most personal property one may possess is the fruit of one's labor. In a capitalist society, typically, this labor gets rewarded in the form of money — a paycheck. Hence, a person's sense of value and self-worth is significantly influenced by how society values his labor — with money not only being that most personal asset, but also being the measuring rod. In days gone by, an individual developed character by learning that an honest day's work would be rewarded with honest money (i.e., gold). Never has there been a more stable measure of value than gold.
In 1913, at the behest of the richest and most powerful banking elites in the world, an agent of social decay was established in the United States. Indeed, the Federal Reserve was founded. The stabilizing influence of gold money, gradually, was replaced by government fiat. Consequently, the character of Americans depreciated in lockstep with its fiat currency.
Paul Cantor describes this phenomenon in his provocative essay Hyperinflation and Hyperreality: Thomas Mann in Light of Austrian Economics. To wit:
Inflation is that moment when as a result of government action the distinction between real money and fake money begins to dissolve. That is why inflation has such a corrosive effect on society. Money is one of the primary measures of value in any society, perhaps the primary one, the principal repository of value. As such, money is a central source of stability, continuity, and coherence in any community. Hence to tamper with the basic money supply is to tamper with a community's sense of value. By making money worthless, inflation threatens to undermine and dissolve all sense of value in a society.
Over the past ninety-three years, since the founding of the Federal Reserve, the dollar has depreciated by over 95%. With money no longer being a stable repository of value – thanks to inflation – a predictable shift in the American character has occurred. Gone are the low-time-preference days where hard work and savings paved the road to a better life for parents and children.
As our fiat money perniciously lost value, time preferences shifted upwards as it made more sense to spend a depreciating currency today than save for the future. And, better yet, what is more seductive than to borrow ever-depreciating fiat money – as heavily encouraged by the Federal Reserve – and pay the principal back with money that has become worth even less? Gradually, savings becomes a vice, profligacy a virtue, and the character of a people regresses to a permanent state of adolescence — as all sense of value is forgone in favor of instant gratification.
Without a doubt, the measuring rod of money is broken. Indeed, money is loaned into existence by the Federal Reserve's banking cartel. Fractional-reserve banking allows it to be created out of thin air. Who needs a gold standard for self-measurement when any adult with a pulse can borrow and spend hundreds of thousands of dollars on McMansions, luxury automobiles, flat screen TVs, country club memberships, and spare-no-expense vacations? What a wonderful life the Federal Reserve has brought to Americans! Easy money and credit bring immediate indulgence. As long as you have absolutely no fear of debt, you too can look extremely successful without ever having had to save a dime. Accordingly, this has given rise to America's new insolvent class: the two-thousandaires.
Let's delve a little further into the characteristics of a two-thousandaire. To be sure, they appear successful — with the nice house, great cars, enormous entertainment center, boutique clothes, and most of it purchased on credit. For the most part, two-thousandaires do not have high-paying jobs. They just live beyond their means. Moreover, these debt-ridden adults live from paycheck to paycheck. There are no savings to fall back upon when that rainy day comes. Just imagine having hundreds of thousands of dollars in debt and only $2,000 in cash savings. Not to worry. This is what credit cards and home equity lines of credit are for.
Americans are stepping up to mainline this new kind of drug known as debt.