Global Power and Global Government:
Part 1 - Evolution and Revolution
of the Central Banking System
by Andrew Gavin Marshall
http://globalresearch.ca/, July
2009
Introduction
Humanity is on the verge of entering into the most tumultuous
period in our history. The prospects of a global depression, the
likes of which have never been seen before; a truly global war,
on a scale never before imagined; and societal collapse, for which
nations of the world are building totalitarian police states to
control populations; are increasing by the day. The major global
trend forecasters are sounding the alarms on economic depression,
war, a return to fascism and a total reorganization of society.
Through crisis, we are seeing the reorganization of the global
political economy, and the transformation of capitalism into a
totalitarian capitalist world government. Capitalism has never
stayed the same through its history; it has always changed and
will continue to do so. Its changes are explained and analyzed
through political-economic theory, both mainstream theory and
critical. The changes are undertaken over years, decades and centuries.
The next phase of capitalism is one in which the world moves to
a state-controlled economic system, much like China, of totalitarian
capitalism.
_The global political economy itself is
being reorganized into a world government body, consisting of
one center of global power where the socio-political-economic
power of the world is centralized in one institution. This is
not a conspiracy theory; it is a reality. Nor is this a subject
confined to the realm of "internet conspiracy theorists,"
but in fact, the concept of world government originates and evolves
throughout the history of capitalism and the global political
economy. Mainstream and critical political-economic theory has
addressed the concept of world government for centuries.
_The notion of a world government has
such a long history, as the forces driving the world into such
a structure intertwine with the history of the modern global political
economy itself. The purpose of this report is to examine the history
of the global political economy in taking steps toward forming
a world government, in both theory and practice.
How did we get here and where are we going?
Why Study Theory?
_Within the academic realm of Political
Science, specifically the field of Global Political Economy (GPE),
it is essential to understand the various theoretical perspectives
of political economy so as to understand the actions and directions
taken within the global political economy, and how capitalism
has been and continues to be reorganized and altered. Theory provides
the foundation upon which actors are understandable and actions
are undertaken. As the political economist Robert Cox once stated,
"Theory is always for someone and for some purpose."
It is important to understand and analyze the theoretical leanings
of those making changes in the global political economy, in order
to understand the changes being made, specifically the theoretical
foundations of a world government. As well as this, it is important
to examine critical theory in how it interprets both how and why
a world government is being constructed.
Mercantilism
_The history of political economic theory
shows a continued fascination with the concept of constructing
such a cosmopolitan or global community. The earliest forms of
western Global Political Economy theorists lie in the early mercantilist
period, and with the emergence of Liberal theory, following Adam
Smith's Wealth of Nations, mercantilist writers such as Friedrich
List and Alexander Hamilton wrote critiques of the underlying
Liberal concepts. List wrote in Political and Cosmopolitical Economy
that Smith dispersed with the idea of a "national economy"
in which nation's determined economic conditions, and instead
advocated replacing the "national" economy with a "cosmopolitical
or world-wide economy." List discusses the perspective of
Jean-Baptiste Say (J.B. Say), a French liberal economist, saying
that Say "openly demands that we should imagine the existence
of a universal republic in order to comprehend the idea of general
free trade."[1]
_List states that, "If, as the prevailing
school [of political-economic thought] requires, we assume a universal
union or confederation of nations as the guarantee for an everlasting
peace, the principle of international free trade seems to be perfectly
justified," however, this prevailing thought "assumes
the existence of a universal union and a state of perpetual peace,
and deduces therefrom the great benefits of free trade. In this
manner it confounds effects with causes." List elaborates
in explaining that, "Among the provinces and states which
are already politically united, there exists a state of perpetual
peace; from this political union originates their commercial union."
Further, "All examples which history can show are those in
which the political union has led the way, and the commercial
union has followed. Not a single instance can be adduced in which
the latter has taken the lead, and the former has grown up from
it."[2]
_It must be addressed that List is a mercantilist
theorist. This means that he views the realm of the political
and economic as an interacting realm in which they are intertwined
and merged, however, the political realm remains above the economic,
which is subject to the dictates of the political element. Liberal
theorists believe that the political and economic realms are separate,
and that they should be separated, so that political elements
interact separately and without influence over the economic realm,
which itself acts independently and separately of the political.
This is the foundation for the ideas of the "free market"
and the oft-quoted Adam Smith phrase, "the invisible hand
of the free market," which was only mentioned once in his
entire volume of the Wealth of Nations. The ascension of liberal
theorists marked a separation in the academic and theoretical
studies, in which Political Economy was separated as a field,
and saw the emergence of Political Science and Economics as separate
studies.
_As political economist Robert Cox stated,
"Theory is always for someone and for some purpose."
The purpose of this separation was to compartmentalize academic
thought and separate the realms of politics and economy, so as
to better control both - as the banking interests, which dominated
both the realms of politics and economics since the late 1600s,
continued to view the world in terms of political-economic theory.
It was a strategy of "divide and conquer," in which
theory and academia was divided in order to conquer and control
thought on both sides. This separation continues to this day,
as even the field of Political Economy is placed underneath and
subjective to Political Science, whereas it would make more sense
that Political Science and Economics would be under the umbrella
of Political Economy. Again, compartmentalize thought and then
the control of discussion and debate becomes much easier.
_What List was arguing in his essay was
a critique of the liberal concept of a cosmopolitical society,
in which all nations are united in a world federation. Naturally,
this was not the case in that era, it was an incorrect and dubious
assumption on the part of liberal theorists. List explained that
never before had economic or commercial interdependence and union
led to a political union. List postulated that history showed
that political union had to precede an economic union. However,
List was writing in the first half of the 19th century, and history
has changed the course of events and Political Economic theory.
I would argue that the major banking interests, essentially made
up of a dynasty of banking families (the Rothschilds, Warburgs,
and later the Morgans and Rockefellers, among many others), decided
to chart a different course, in which they would pursue a strategy
in which economic union would be incrementally undertaken with
the aim of constructing a political union to follow in its footsteps.
Central Banking
_Thus, liberal economic theory came to
the forefront, championed by the global hegemonic power of the
day, Great Britain, which was firmly under the control of the
banking dynasties. In 1694, the Bank of England was formed as
a private central bank, which would issue the currency of the
nation, lending it to the government and industry at interest,
which would be paid back to the Bank of England's shareholders,
made up of these private banking dynasties.[3] The 16th to the
19th centuries was the period in which both the nation-state and
capitalism emerged, soon followed by central banking in the late
1600s. This is when the origins of what was known as a "world
economy" took place. Mercantilist economic theory dominated
this period, in which the economy was secondary and submissive
to the political structure of nations.
_Liberal theorists rose in opposition
to this. Adam Smith wrote the Wealth of Nations in 1776, the same
year that the American colonies revolted against the British imperial
forces in the country, and ultimately gained independence from
the British Empire. Among many of the primary motivating factors
for the Revolution were the British military presence in the American
colonies, acting above the law; a heavy imposition of colonial
taxes, particularly on tea and other imports from foreign nations
such as France, in an effort to promote the mercantilist assumptions
that the colony should only survive and trade with the metropole
(imperial hegemon) - which extracts the resources of the nation
in trade for material goods to that nation, creating a dependence
upon the colonial power. Arguably one of the primary motivations
for the Revolution was the control of currency by a foreign imperial
power, with the ability to control inflation and devaluation,
essentially controlling the entire economic conditions of the
colony from abroad. The Founding Fathers of the United States
understood the necessity of controlling one's own currency if
one was to preserve sovereignty and independence.
_Following Britain's humiliating defeat,
which was aided by the French who supported the American revolt,
European banking interests suffered a significant blow against
their mercantilist expansion. Capitalism functions in that it
constantly needs to expand and consume more. Central banking functions
in a very similar, although much more dubious manner, in which
it needs to expand its control over industry, nations and people
through the expansion of debt, continually needing to bring more
individuals, nations and industries under debt bondage. Debt is
the source of all power and wealth for the central banking system
- as they do not actually produce any tradable good, such as industry;
nor do they provide any necessary service, such as government.
Interest on debt is the source of income and authority for the
central banking system, and thus, it needs to continually advance
credit and expand debt. Thus, the loss of the American colonies
as a source of expansionary credit and debt was a massive blow
to their entrenched interests.
_The European banking interests quickly
learned their lesson regarding not falling under the imperial
hubris of believing people of a given region or nation could never
defeat imperial might and armies. Revolution had become a great
threat to the entrenched capitalist, and particularly, banking
interests.
_Within a decade of the American Revolutionary
War, which ended in 1783, another nation was going down the road
of revolutionary zeal, in part inspired by the American example.
However, this nation was no colony, but rather a mercantilist
imperial power, and thus, its loss would be too great a loss to
allow. In 1788, the French Monarchy was bankrupt, and as tensions
grew between the increasingly desperate people of France and the
aristocratic and particularly monarchic establishment, European
bankers decided to pre-empt and co-opt the revolution. In 1788,
prominent French bankers refused "to extend necessary short-term
credit to the government,"[4] and they arranged to have shipments
of grain and food to Paris "delayed" which triggered
the hunger riots of the Parisians.[5] This sparked the Revolution,
in which a new ruling class emerged, driven by violent oppression
and political and actual terrorism. However, its violence grew,
and with that, so too did discontentment with the Revolutionary
Regime, and its stability and sustainability was in question.
Thus, the bankers threw their weight behind a general in the Revolutionary
Army named Napoleon, whom they entrusted to restore order. Napoleon
then gave the bankers his support, and in 1800, created the Bank
of France, the privately owned central bank of France, and gave
the bankers authority over the Bank. The bankers owned its shares,
and even Napoleon himself bought shares in the bank.[6]
_The bankers thus sought to control commerce
and government and restore order to their newly acquired and privately
owned and operated empire. However, Napoleon continued with his
war policies beyond the patience of the bankers, which had a negative
impact upon commercial activities,[7] and Napoleon himself was
interfering in the operations of the Bank of France and even declared
that the Bank "belongs more to the Emperor than to the shareholders."[8]
With that, the bankers again shifted their influence, and remained
through regime change.[9]
_The Rothschilds ascended to the throne
of international banking with the Battle of Waterloo. After having
established banking houses in London, Paris, Frankfurt, Vienna
and Naples, they profited off of all sides in the Napoleonic wars.[10]
The British patriarch, Nathan Rothschild, was known for being
the first with news in London, ahead of even the monarchy and
the Parliament, and so everyone watched his moves on the stock
market during the Battle of Waterloo. Following the battle, Nathan
got the news that the British won over 24 hours before the government
itself had news, and he quietly went into the London Stock Exchange
and sold everything he had, implying to those watching that the
British lost. A panic selling ensued, in which everyone sold stock,
stock prices crumbled, and the market crashed. What resulted was
that Rothschild then bought up the near-entire British stock market
for pennies on the dollar, as when news arrived of the British
victory at Waterloo, Rothschild's newly acquired stocks soared
in value, as did his fortune, and his rise as the pre-eminent
economic figure in Britain.[11]
_As Goergetown University History professor,
Carroll Quigley wrote in his monumental Tragedy and Hope, "The
merchant bankers of London had already at hand in 1810-1850 the
Stock Exchange, the Bank of England, and the London money market,"
and that:
In time they brought into their financial network the provincial
banking centers, organized as commercial banks and savings banks,
as well as insurance companies, to form all of these into a single
financial system on an international scale which manipulated the
quantity and flow of money so that they were able to influence,
if not control, governments on one side and industries on the
other.[12]
_The period from 1815 to 1914 was known
as the British Imperial Century, in which they adopted the liberal
economic concepts of Adam Smith, and manipulated and distorted
them for their own imperial ambitions. Mercantilism was still
strong in practice, but rode under the banner of a liberal economic
order, "free markets" and the "invisible hand."
The "invisible hand" was in fact, connected to a body
made up of government and industry, molding the "free market"
according to its designs, and the body was controlled by the brain,
the central bank, the Bank of England. Markets were hardly "free"
and the hand was visible to those who could see the rest of the
body.
The Liberal Revolution
_It was during this British imperial century
that other nations, such as Germany and the United States, were
pursuing mercantilist economic practices in order to protect their
own nations from the British free-trade imperialism. It was in
this context that mercantilist theorists such as Alexander Hamilton
in the United States, and Friedrich List in Germany were writing
in criticism of liberal economic theory.
_Mercantilism was dominant in political-economic
theory until the mid 19th century when the 'liberal revolution'
manifested, largely in critical opposition to mercantilism. In
liberal economic theory, the economic realm is autonomous and
separate from the political realm, and functions according to
its own logic. Within this theory, politics and economics, though
separate spheres, are still connected, but remain independent
of one another. Whereas mercantilists see the state as the primary
actor in the global political economy, liberals see the individual
(both producer and consumer) as being the major actor.
_Mercantilists see the international arena
as inherently conflictual, justifying their policies of colonialism
and empire building in an international arena in which if one
state does not colonize foreign lands and extract resources, another
state will, and thus, will deprive the state that does not create
an empire of resources and economic growth. In this sense, mercantilists
view the world in terms of a zero-sum gain, in which the progress
of one state requires the regression of another. Liberal theorists
argue that the international arena, made up of individuals, constitutes
a positive-sum gain, in which all individuals act according to
self-interest, and in doing so, benefit everyone, and foster cooperation
and interdependence. In this sense, the international arena is
not inherently conflictual, but rather a cooperative and interdependent
sphere in which order and stability is upheld by international
regimes - such as the British liberal imperial order and the gold
standard it instituted.
_Where mercantilists view history as an
amalgamation of conflicts and decisions made by states, liberal
theorists view history as the sum of the unintended consequences
of actions made by private individuals and activities. This implies
almost an inherently natural progression of history - that it
is not shaped by powerful forces in any designed or intended way,
but is merely a natural response and reaction to the actions of
individuals. This ties into the liberal concept of the natural
state of a liberal economic order, bringing in the idea of the
"invisible hand of the free market" which will determine
economic activities.
_Adam Smith's notion of the "invisible
hand" has been used to advance the idea that private individuals
who seek personal wealth and gain through self-interest will unintentionally
aid the interests of all of society. However, the "invisible
hand" was mentioned merely once in Smith's monumental Wealth
of Nations, and was taken out of context. Smith was discussing
how "Every individual naturally inclines to employ his capital
in the manner in which it is likely to afford the greatest support
to domestic industry, and to give revenue and employment to the
greatest number of people of his own country." In addition
to employing "his capital in the support of domestic industry,"
the private individual would "direct that industry that its
produce may be of the greatest value." Therefore, the individual
"neither intends to promote the public interest, nor knows
how much he is promoting it." Smith explains that:__"By
preferring the support of domestic to that of foreign industry,
he intends only his own security; and by directing that industry
in such a manner as its produce may be of the greatest value,
he intends only his own gain, and he is in this, as in many other
cases, led by an invisible hand to promote an end which was no
part of his intention."[13]
_Smith had conceptualized the "invisible
hand" as the "natural inclination" of an individual
to promote domestic interests, yet the phrase has been manipulated
to promote the concept of a "self regulating market"
in which the less regulation and restrictions there are, the better
all society will be, because industry will naturally benefit all
people. The manipulation of this phrase has taken the notion of
the "invisible hand" away from the actions of individuals
and transferred it to promoting non-regulation of economic activities.
That is a far cry from Smith's contention.
_Smith even stated in the Wealth of Nations
that, "People of the same trade seldom meet together, even
for merriment and diversion, but the conversation ends in a conspiracy
against the public, or in some contrivance to raise prices. It
is impossible indeed to prevent such meetings, by any law which
either could be executed, or would be consistent with liberty
and justice. But though the law cannot hinder people of the same
trade from sometimes assembling together, it ought to do nothing
to facilitate such assemblies; much less to render them necessary."[14]
_In discussing regulation regarding wages
for workers and resolving equity issues between the employers,
or "masters" and the labour class of "workers,"
Smith explained that, "Whenever the legislature attempts
to regulate the differences between masters and their workmen,
its counselors are always the masters. When the regulation, therefore,
is in favour of the workmen, it is always just and equitable;
but it is sometimes otherwise when in favour of the masters."
Further, "When masters combine together in order to reduce
the wages of their workmen, they commonly enter into a private
bond or agreement, not to give more than a certain wage under
a certain penalty. Were the workmen to enter into a contrary combination
of the same kind, not to accept a certain wage under a certain
penalty [such as a union], the law would punish them very severely;
and if it dealt impartially, it would treat the masters in the
same manner."[15]
_These quotes by Adam Smith tend to fly
in the face of the common perceptions and usage of Smith's ideas,
proving that liberal economy in practice is a far cry from the
intent of its original theorist.
_In the 1870s, the notion of a "liberal
economic order" was challenged as the major European empires
undertook an incredible extension of their imperial presence across
the globe, itself a mercantilist practice - the idea of obtaining
colonies in order to extract its resources, create a captive market
for the imperial nations manufactured goods, and deprive its economic
competitors of access to that market. Between 1878 and 1913, European
empires extended their control over much of the world, specifically
with the Scramble for Africa, in which all of Africa, save Ethiopia,
was colonized by European powers.
_This "new imperialism," as
it was known, proliferated throughout Europe following the rapid
expansion of banking throughout the continent, and the pre-eminence
of international financiers over governments.[16] The growth of
the continent-wide banking networks "fed the growth of colonial
empires" as it stimulated a system in which "creating
debt that then had to be serviced by the purchase of more infrastructure,"
and expansion of territory.[17] This led European nations to undertake
a massive imperial effort across much of the globe, to find and
control foreign markets and expand their capital.
The Emergence of Marxism
_In the 19th century, the rise of critical
IPE (International/Global Political Economy) theories emerged
in opposition to the growing dominance of Liberal IPE. The most
profound of these criticisms arose from Karl Marx. Marxism, as
Marx's critical theory came to be known, put an extensive focus
on the relations of classes within society, as the class that
owns the means of production is the central and most powerful
class, subverting the other classes to a submissive position.
Marxists also view capitalism as being inherently exploitative.
Within this theory, the political and economic realms are not
seen as separate spheres of action, but are seen as intertwined
and internally related. Within this theory, the purpose of the
state is not to serve the interests of the broader population
that inhabits it, but to secure, maintain and advance the interests
of the capitalist class. Marxist theorists also put emphasis on
the nature of war and conflict as being intrinsically related
to the expansionary nature of capitalism, which is one of the
primary roles of states in advancing the interests of the capitalist
ruling class.
_Marx defines what he perceives as capitalism:
a system which is governed by capital, which is money that has
been invested in order to generate more money; production, which
is dominant within capitalist society, is designed for sale, not
use - in that, it moves beyond subsistence and into what we refer
to today as materialism and consumption; labour is commodified,
thus people, through their labour, themselves become a tradable
commodity; exchange occurs with money; ownership of the means
of production is in the hands of the capitalist class; and competition
between various capitalist forces is the logic of interaction.
_Marx places a large focus on the circuit
of capital, in how money transforms into capital. Money (M), is
invested in purchasing a Commodity (C), and then into Labour Power
(LP) and the Mean of Production (MP), which make up the Production
circuit (P), which produces a new Commodity (C1), which is then
sold, creating expanding money (M1), or earned profits. Capital,
thus, is money that is invested into production. Marx postulates
that the inherent exploitative nature of capitalism is most apparent
in the Production circuit, specifically with Labour Power.
Diverging From Marx
_However, with the exploration and understanding of the central
banking system, some of the circuit of capital must be called
into question. Central banking functions not on "investment"
of capital, but on the expansion and creation of money and debt,
which is lent at interest, thus serving as the source of income
for the central banking system. This cannot be called productive
capital, for its purpose and intent is not to produce a new commodity,
there is no labour power or means of production involved, and
new money is not produced from the sale of such a new commodity,
but rather profit is extracted from interest on the original money.
This, for the sake of argument, can be called the Circuit of Debt:
M à L à I à M1 à LID à DB
M = Money
L = Loan
I = Interest
M1 = New Money
LID = new money Loaned to debtor to pay Interest on Debt
DB = debtor falls into Debt Bondage; owned by creditor
_Through the Marxist perspective of exploitation,
there is no labour to exploit within the Circuit of Debt, so where
does exploitation come into play? Exploitation comes into the
process in that the debt (or loan) issued, is designed to exploit
whoever the debtor is, be it an individual, a nation, or a corporation.
Within this paradigm, class structure, although playing a significant
part of the process of overall exploitation and exercise of power
within the capitalist system is not the only, or arguably, even
primary target of control and oppression within capitalism, as
we know it. The target is the individual, the nation, and industry
to the submission of the predatory nature of the central banking
system.
_The central banking system has, from
its inception, acted in ways which monopolize industry (thus negating
Adam Smith's concept of a "free market" and "competition");
militarize nations (financing wars and conquest, imperialism);
merging the interests of both the economic and political realms
into a holistic ruling class (modeled upon the dual nature of
a central bank itself - holding the authority and power of a government
body, but representing the interests and submitting to the ownership
of private individuals). Thus, the ruling class itself is a social
construct which this tiny elite formed, hardly capable of the
numbers to be termed a class, especially since class is most often
defined in national terms, whereas this elite is international
in nature.
_The central bank of a nation finances
monopoly industry and imperial states, both of which are created
out of debt bondage to the central bank. Both the commercial/industrial
elites and political elites merge their interests - the state
will pursue imperial policies that have the effect of benefiting
industry, while industry will support the building of a strong,
powerful state (and provide a cozy job for the political elite
upon leaving the public sector). This makes up the ruling class
of a nation, the capitalists, or owners of the means of production,
merging with the political rulers of the nation. One does not
represent or overpower the other, but rather, both serve the interests
and are owned through interest, by a tiny international elite.
_One must ask: What would capitalism look
like if it were not for the advent of the central banking system?
Accumulation by Dispossession
_In discussing Marxist theory, I am not
advocating a total support of its theoretical discussion and perspective.
However, it is vital to address, as historically and presently,
it has served as a very powerful source of criticism against the
capitalist system and its importance cannot be underestimated.
Having said that, it is also important to address in that it does,
as a theory, identify many accurate and important aspects of how
the capitalist system functions. For that reason, many of the
critiques have been and are currently prescient and justified.
_In Marxist theory, the nature of accumulation
plays a very important part, in that it holds a dual character.
One is known as accumulation as expanded reproduction, which is
concerned with commodity markets and production (the circuit of
capital), where money is made through the labour process. The
other nature of accumulation is accumulation by dispossession,
which is usually framed in terms of relations between capitalist
and non-capitalist modes of production. This is accumulation derived
from dispossessing someone of something. The Atlantic slave trade
was an example of accumulation by dispossession, as Africans were
dispossessed of their lives and freedom. Colonialism is another
example, where resources are extracted, dispossessing the nation
of its own resources.
_Perhaps it would be helpful to expand
upon Marx's ideas of accumulation by dispossession in regards
to the central banking system. Central banking, not falling into
the circuit of capital, and thus, accumulation as expanded reproduction,
better represents an example of accumulation by dispossession.
Money is given in loans at interest, to which the debtor is never
meant to fully repay, and is dispossessed of its freedom and wealth
through interest payments and debt bondage. Debt is just another
word for slavery, therefore, the central banking system itself,
functions through a system of accumulation by dispossession.
_However, conventional understanding of
accumulation by dispossession describes it as an interaction between
capitalist and non-capitalist modes of production, where the capitalist
mode will dispossess the non-capitalist mode of production. Central
banking, however, is the pinnacle of the capitalist system, and
ultimately, the primary source and avenue of its power, so it
can hardly be said to be an interaction between capitalist and
non-capitalist modes, as it is an interaction between central
banks and ALL modes of production which need money - including
the entirety of the capitalist system. Thus, industry/commerce,
governments/nations, and individuals/people, are dispossessed
of their freedom through debt bondage. This cannot simply be predicated
in terms of class warfare or class-centric theory, but rather,
an assault against all individuals, individuality, and freedom,
in any and all forms. It is within this context that class structures
are created, so as to play off one against the other - to compartmentalize
people into classes, and thus, better control and manipulate the
masses. It is a strategy of dividing and conquering people. Class,
including the upper capitalist class, is constructed in an effort
to conform thought within each class, and thus direct collective
action of that class accordingly. The freethinking individual
is the target in all cases. Individuality is to be removed from
commerce, government, and society as a whole.
The Communist Manifesto
_In the Communist Manifesto, published
in 1848, Marx proclaims in the opening subtitle that, "The
history of all society hitherto is the history of class struggles."
However, if class itself is a construct of powerful individuals,
albeit throughout human history, can it not be argued instead
that the history of all society is the history of the struggle
of the individual against collectivity and control? Class itself
is a collective grouping designed to control a mass of people,
whether it is upper class or lower class. Individuals are stifled
within all classes, and thus, the history of class struggles itself,
is a history of the struggle between the free thinking individual
and the collective form of control.
_Within the Communist Manifesto, Marx
(and Engels) outlined an initial program for an "advanced"
nation to undertake in order to create a Communist system, with
ten major points. (1) Abolition of property in land and application
of all rents of land to public purposes; (2) A heavy progressive
or graduated income tax; (3) Abolition of all right of inheritance;
(4) Confiscation of the property of all emigrants and rebels;
(5) Centralization of credit in the hands of the state, by means
of a national bank with state capital and an exclusive monopoly;
(6) Centralization of the means of communication and transport
in the hands of the state; (7) Extension of factories and instruments
of production owned by the state - the bringing into cultivation
of waste lands, and the improvement of the soil generally in accordance
with a common plan; (8) Equal liability of all to labour - Establishment
of industrial armies, especially for agriculture; (9) Combination
of agriculture with manufacturing industries - gradual abolition
of the distinction between town and country by a more equable
distribution of the population over the country; and (10) Free
education for all children in public schools - Abolition of children's
factory labour in its present form [and] Combination of education
with industrial production.[18]
_Of particular importance is number 5,
in which a central bank is advocated. If nations have the ability
to create and issue a currency through a Treasury department or
even on a more regional or local level, why centralize and monopolize
creation of a currency to a central bank? It should be noted that
the recommendation was to have it centralized "in the hands
of the state," however, central banks are today, still widely
perceived as being within the purview of governmental authority,
while acting and functioning totally outside of it and above it.
Imposing a tax on one's income (2), also seems to promote the
commodification of labour, in that instead of industry exploiting
one's labour and extracting a profit from it, that becomes the
job of the state. All property would be owned by the state (1),
and virtually the entire economy is subject to the control of
the state. Even education, while free, is directed by the state.
With the "Confiscation of the property of all emigrants and
rebels," what room is there for dissenting thought in such
a society? Dissent would not be encouraged within the "free
education" system. In fact, conformity would be enshrined.
Is this not a form of "accumulation by dispossession"
in which the individual is dispossessed of free thought and action
and submitted to the will of and restricted thinking allowed by
the state? Within this paradigm the state accumulates power and
authority by dispossessing people of individuality in thought
and expression.
_The Communist Manifesto ends with the
declaration of, "Workers of all countries, Unite!" This,
in and of itself, promotes class divisions within society, placing
focus on the need for an international mobilization of the global
working class to rise up against the capitalist class. Marx outlines
that any successful workers' revolution must be international.[19]
Thus, this promotes the cosmopolitical notion of an international
community, at least in initial terms of a transnational class
system. Essentially, Marx argues that as capitalism expands, what
we will later term "Globalizes," so too must the working
class of the world "globalize" and "internationalize."
In a sense, this makes Marx, himself, an early globalist theorist,
in promoting the concept of an international class uprising against
the capitalist class. Ultimately, would this not simply replace
the tyranny of one class for the tyranny of another? Throw out
the capitalists and bring in the communists! Substituting one
form of oppression for another is hardly a change in the right
direction. In both systems, the individual suffers and free thought
is stifled.
_Though much Marxist criticism is extremely
pointed in analyzing the functions and structure of the capitalist
system, such theory itself, even though critical, must be critically
examined.
Retaking America
_The history of the United States from
its founding through the 19th century to the early 20th century,
was marked by a continual political battle revolving around the
creation of a central bank of the United States. Mercantilists
such as Alexander Hamilton, who was the first Treasury Secretary,
were in favour of such a bank, and his advice won over George
Washington, much to the dismay of Thomas Jefferson, who was a
strong opponent to central banking. However, "[Alexander]
Hamilton, believing that government must ally itself with the
richest elements of society to make itself strong, proposed to
Congress a series of laws, which it enacted, expressing this philosophy,"
and that, "A Bank of the United States was set up as a partnership
between the government and certain banking interests,"[20]
which lasted until the charter expired in 1811.
_Again, during the tenure of Andrew Jackson
(1829-1837), the primary political struggle was with the entrenched
financial interests both domestic and from abroad (namely Western
Europe), on the issue of creating a central bank of the US. Andrew
Jackson stood in firm opposition to such a bank, saying that,
"the bank threatened the emerging order, hoarding too much
economic power in too few hands," and referred to it as "The
Monster."[21] Congress passed the bill allowing for the creation
of a Second Bank of the United States, however, Andrew Jackson
vetoed the bill, much to the dismay of the banking interests.
_It was in the later half of the 1800s
that "European financiers were in favor of an American Civil
War that would return the United States to its colonial status,
they admitted privately that they were not necessarily interested
in preserving slavery," as it had become unprofitable.[22]
The Civil War was not based upon the liberation of slaves, it
was, as Howard Zinn described it, a clash "of elites,"
with the northern elite wanting "economic expansion - free
land, free labor, a free market, a high protective tariff for
manufacturers, [and] a bank of the United States. [Whereas] The
slave interests opposed all that."[23] The Civil War, which
lasted from 1861 until 1865, resulted in hundreds of thousands
of deaths, during which, "Congress also set up a national
bank, putting the government into partnership with the banking
interests, guaranteeing their profits."[24]
_As Lincoln himself stated:
The money powers prey on the nation in times of peace and conspire
against it in times of adversity. The banking powers are more
despotic than monarchy, more insolent than autocracy, more selfish
than bureaucracy. They denounce as public enemies all who question
their methods or throw light upon their crimes.
I have two great enemies, the Southern Army in front of me, and
the bankers in the rear. Of the two, the one at my rear is my
greatest foe. As a most undesirable consequence of the war, corporations
have been enthroned, and an era of corruption in high places will
follow. The money power will endeavor to prolong its reign by
working upon the prejudices of the people until the wealth is
aggregated in the hands of a few, and the Republic is destroyed.[25]
Throughout much of the 1800s and into
the 1900s, the United States suffered several economic crises,
one of the most significant of which was the Great Depression
of 1873. As Howard Zinn explained:
The crisis was built into a system which was chaotic in its nature,
in which only the very rich were secure. It was a system of periodic
crises - 1837, 1857, 1873 (and later: 1893, 1907, 1919, 1929)
- that wiped out small businesses and brought cold, hunger, and
death to working people while the fortunes of the Astors, Vanderbilts,
Rockefellers, Morgans, kept growing through war and peace, crisis
and recovery. During the 1873 crisis, Carnegie was capturing the
steel market, Rockefeller was wiping out his competitors in oil.[26]
_Massive industrial consolidation by a
few oligarchic elites was the rule of the day, as J.P. Morgan
expanded total control over railroad and banking interests, and
John D. Rockefeller took control of the oil market, and expanded
into banking. Zinn explained that, "The imperial leader of
the new oligarchy was the House of Morgan. In its operations it
was ably assisted by the First National Bank of New York (directed
by George F. Baker) and the National City Bank of New York (presided
over by James Stillman, agent of the Rockefeller interests). Among
them, these three men and their financial associates occupied
341 directorships in 112 corporations. The total resources of
these corporations in 1912 was $22,245,000,000, more than the
assessed value of all property in the twenty-two states and territories
west of the Mississippi River."[27]
_These banking interests, particularly
those of Morgan, were very much allied with European banking interests.
On the European side, specifically in Britain, the elite were
largely involved in the Scramble for Africa at this time. Infamous
among them was Cecil Rhodes, who made his fortune in the diamond
and gold mining in Africa, as "With financial support from
Lord Rothschild and Alfred Beit, he was able to monopolize the
diamond mines of South Africa as De Beers Consolidated Mines and
to build up a great gold mining enterprise as Consolidated Gold
Fields."[28] Interestingly, "Rhodes could not have won
his near-monopoly over South African diamond production without
the assistance of his friends in the City of London: in particular,
the Rothschild bank, at that time the biggest concentration of
financial capital in the world."[29] As historian Niall Ferguson
explained, "It is usually assumed that Rhodes owned De Beers,
but this was not the case. Nathaniel de Rothschild was a bigger
shareholder than Rhodes himself; indeed, by 1899 the Rothschilds'
stake was twice that of Rhodes."[30]
_Cecil Rhodes was also known for his radical
views regarding America, particularly in that he would "talk
with total seriousness of 'the ultimate recovery of the United
States of America as an integral part of the British Empire'."[31]
Rhodes saw himself not simply as a money maker, but primarily
as an "empire builder." As historian Carroll Quigley
explained, in 1891, three British elites met with the intent to
create a secret society. The three men were Cecil Rhodes, William
T. Stead, a prominent journalist of the day, and Reginald Baliol
Brett, a "friend and confidant of Queen Victoria, and later
to be the most influential adviser of King Edward VII and King
George V." Within this secret society, "real power was
to be exercised by the leader, and a 'Junta of Three.' The leader
was to be Rhodes, and the Junta was to be Stead, Brett, and Alfred
Milner."[32]
_In 1901, Rhodes chose Milner as his successor
within the society, of which the purpose was, "The extension
of British rule throughout the world, the perfecting of a system
of emigration from the United Kingdom and of colonization by British
subjects of all lands wherein the means of livelihood are attainable
by energy, labour, and enterprise . . . [with] the ultimate recovery
of the United States of America as an integral part of a British
Empire, the consolidation of the whole Empire, the inauguration
of a system of Colonial Representation in the Imperial Parliament
which may tend to weld together the disjointed members of the
Empire, and finally the foundation of so great a power as to hereafter
render wars impossible and promote the best interests of humanity."[33]
Essentially, it outlined a British-led cosmopolitical world order,
one global system of governance under British hegemony. Among
key players within this group were the Rothschilds and other banking
interests.[34]
_In the early 20th century, European and
American banking interests achieved what they had desired for
over a century within America, the creation of a privately owned
central bank. It was created through collaboration of American
and European bankers, primarily the Morgans, Rockefellers, Kuhn,
Loebs and Warburgs.[35] After the 1907 banking panic in the US,
instigated by JP Morgan, pressure was placed upon the American
political establishment to create a "stable" banking
system. In 1910, a secret meeting of financiers was held on Jekyll
Island, where they planned for the "creation of a National
Reserve Association with fifteen major regions, controlled by
a board of commercial bankers but empowered by the federal government
to act like a central bank - creating money and lending reserves
to private banks."[36] President Woodrow Wilson followed
the plan almost exactly as outlined by the Wall Street financiers,
and added to it the creation of a Federal Reserve Board in Washington,
which the President would appoint.[37] The Federal Reserve, or
Fed, "raised its own revenue, drafted its own operating budget
and submitted neither to Congress," while "the seven
governors shared power with the presidents of the twelve Reserve
Banks, each serving the private banks in its region," and
"the commercial banks held stock shares in each of the twelve
Federal Reserve Banks."[38]
_The retaking of the United States by
international banking interests was achieved with barely a whimper
of opposition. Where the British Empire failed in taking the United
States militarily, international bankers succeeded covertly through
the banking system. The Federal Reserve also had the effect of
cementing an alliance between New York and London bankers.[39]
Notes
[1]George T. Crane, Abla Amawi, The Theoretical evolution of international
political economy. Oxford University Press US, 1997: pages 48-49
[2]George T. Crane, Abla Amawi, The Theoretical evolution of international
political economy. Oxford University Press US, 1997: pages 50-51
[3]John Kenneth Galbraith, Money: Whence it Came, Where it Went
(Boston: Houghton Mifflin Company, 1975), 31
[4]Donald Kagan, et. al., The Western Heritage. Volume C: Since
1789: Ninth edition: (Pearson Prentice Hall: 2007), 596
[5]Curtis B. Dall, F.D.R. : My Exploited Father-in-Law. (Institute
for Historical Review: 1982), 172
[6]Carroll Quigley, Tragedy and Hope: A History of the World in
Our Time (New York: Macmillan Company, 1966), 515
Robert Elgie and Helen Thompson, ed., The Politics of Central
Banks (New York: Routledge, 1998), 97-98
[7]Carroll Quigley, Tragedy and Hope: A History of the World in
Our Time (New York: Macmillan Company, 1966), 516
[8]Robert Elgie and Helen Thompson, ed., The Politics of Central
Banks (New York: Routledge, 1998), 98-99
[9]Carroll Quigley, Tragedy and Hope: A History of the World in
Our Time (New York: Macmillan Company, 1966), 516
[10] Sylvia Nasar, Masters of the Universe. The New York Times:
January 23, 2000: http://query.nytimes.com/gst/fullpage.html?res=9C04E3D6123AF930A15752C0A9669C8B63
BBC News. The Family That Bankrolled Europe. BBC News: July 9,
1999
http://news.bbc.co.uk/1/hi/uk/389053.stm
[11] New Scientist. Waterloo Windfall. New Scientist Magazine:
Issue 2091, July 19, 1997
http://www.newscientist.com/article/mg15520913.300-waterloo-windfall.html
BBC News. The Making of a Dynasty: The Rothschilds. BBC News:
January 28, 1998
http://news.bbc.co.uk/2/hi/uk_news/50997.stm
[12] Carroll Quigley, Tragedy and Hope: A History of the World
in Our Time (New York: Macmillan Company, 1966), 51
[13] Adam Smith, The Wealth of Nations. U. of Chicago Edition,
1976: Vol. IV, ch. 2: 477
[14] Adam Smith, An inquiry into the nature and causes of the
wealth of nations. Regnery Gateway, 1998: page 152
[15] Adam Smith, An inquiry into the nature and causes of the
wealth of nations. Regnery Gateway, 1998: pages 166-167
[16] Patricia Goldstone, Aaronsohn's Maps: The Untold Story of
the Man who Might Have Created Peace in the Middle East. (Harcourt
Trade, 2007), 29-30
[17] Patricia Goldstone, Aaronsohn's Maps: The Untold Story of
the Man who Might Have Created Peace in the Middle East. (Harcourt
Trade, 2007), 31
[18] Karl Marx, Friedrich Engels, Philip Gasper (ed.), The Communist
manifesto: a road map to history's most important political document.
Haymarket Books, 2005: pages 70-71
[19] Karl Marx, Friedrich Engels, Philip Gasper (ed.), The Communist
manifesto: a road map to history's most important political document.
Haymarket Books, 2005: page 67
[20] Howard Zinn, A People's History of the United States. Harper
Perennial: New York, 2003: page 101
[21] Michael Waldman, My Fellow Americans: The Most Important
Speeches of America's Presidents, from George Washington to George
W. Bush. Longman Publishing Group: 2004: page 25
[22] Dr. Ellen Brown, Today We're All Irish: Debt Serfdom Comes
to America. Global Research: March 15, 2008: http://www.globalresearch.ca/index.php?context=viewArticle&code=BRO20080315&articleId=8349
[23] Howard Zinn, A People's History of the United States. Harper
Perennial: New York, 2003: page 189
[24] Howard Zinn, A People's History of the United States. Harper
Perennial: New York, 2003: page 238
[25] Steve Bachman, Unheralded Warnings from the Founding Fathers
to You. Gather: June 19, 2007: http://www.gather.com/viewArticle.jsp?articleId=281474977031677
[26] Howard Zinn, A People's History of the United States. Harper
Perennial: New York, 2003: page 242
[27] Howard Zinn, A People's History of the United States. Harper
Perennial: New York, 2003: page 323
[28] Carroll Quigley, Tragedy and Hope: A History of the World
in Our Time (New York: The Macmillan Company, 1966), 130
[29] Niall Ferguson, Empire: The Rise and Demise of the British
World Order and the Lessons for Global Power (New York: Basic
Books, 2004), 186
[30] Niall Ferguson, Empire: The Rise and Demise of the British
World Order and the Lessons for Global Power (New York: Basic
Books, 2004), 186-187
[31] Niall Ferguson, Empire: The Rise and Demise of the British
World Order and the Lessons for Global Power (New York: Basic
Books, 2004), 190
[32] Carroll Quigley, The Anglo-American Establishment. GSG &
Associates, 1981: page 3
[33] Carroll Quigley, The Anglo-American Establishment. GSG &
Associates, 1981: page 33
[34] Carroll Quigley, The Anglo-American Establishment. GSG &
Associates, 1981: page 34
[35] Murray N. Rothbard, Wall Street, Banks, and American Foreign
Policy. World Market Perspective: 1984: http://www.lewrockwell.com/rothbard/rothbard66.html
[36] William Greider, Secrets of the Temple: How the Federal Reserve
Runs the Country. (New York: Simon and Schuster, 1987), 276
[37] William Greider, Secrets of the Temple: How the Federal Reserve
Runs the Country. (New York: Simon and Schuster, 1987), 277
[38] William Greider, Secrets of the Temple: How the Federal Reserve
Runs the Country. (New York: Simon and Schuster, 1987), 50
[39] William Engdahl, A Century of War: Anglo-American Oil Politics
and the New World Order. (London: Pluto Press, 2004), 51
Andrew Gavin Marshall is a Research Associate with the Centre
for Research on Globalization (CRG). He is currently studying
Political Economy and History at Simon Fraser University.
Andrew Gavin Marshall is a frequent contributor
to Global Research. Global Research Articles by Andrew Gavin Marshall
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