A Letter: Money and Conspiracy Part 2 — Conspiracy

A Letter: Money and Conspiracy

Part 2 — Conspiracy

Thomas Allen

[Editor’s note: The following is a letter written in 2004 responding to an article by Mr. Rittenouse in Countryside. This letter has been divided into two parts: Part 1 — Money and Part 2 — Conspiracy.]

    Mr. Rittenhouse pooh-poohs the thought that some cabal may be working to control governments and the world. Some high and mighty people disagree with him. Here is a sample of what some of these important people have said about this cabal. I dare say; these people had much more insider information than Mr. Rittenhouse.
    Arthur Schlesinger, Jr.: “We are not going to achieve a new world order without paying for it in blood as well as words and money.”
    Supreme Court Justice Felix Frankfurter, “the outstanding power behind the New Deal”: “The real rulers in Washington are invisible, and exercise power from behind the scenes.” At a dinner party, Frankfurter was asked who ran the United States; he replied, “The real rulers of a nation are undiscoverable.”
    John F. Hylan, mayor of New York: “The real menace of our Republic is the invisible government which like a giant octopus sprawls its slimy length over our city, state and nation. . . . At the head of this octopus are the Rockefeller-Standard Oil interests and a small group of powerful banking houses generally referred to as the international bankers [who] virtually run the U.S. government for their own selfish purposes.”
    After observing governmental leaders of the United States consistently making concessions to the Soviet Union, James Forrestal, the first Secretary of Defense, commented, “These men are not incompetent or stupid. They are crafty and brilliant. Consistency has never been a mark of stupidity. If they were merely stupid, they would occasionally make a mistake in our favor.”
    President-elect Ronald Reagan: “I think there is an elite in this country and they are the very ones who run an elitist government. They want a government by a handful of people because they don’t believe the people themselves can run their lives. . . . Are we going to have an elitist government that makes decisions for people’s lives, or are we going to believe as we have for so many decades, that the people can make these decisions for themselves?”
    A few years after resigning as President, Richard Nixon wrote, “The nation’s immediate problem is that while the common man fights America’s wars, the intellectual elite sets its agenda. Today, whether the West lives or dies is in the hands of its new power elite: those who set the terms of public debate, who manipulate the symbols, who decide whether nations or leaders will be depicted on 100 million television sets as ‘good’ or ‘bad.’ This power elite sets the limits of the possible for President and Congress. It molds the impressions that move the nation, or that mire it.”
    Jim Kirk, who had been a member of the Students for a Democratic Society, Communist Party, and the Black Panthers, said about the control of radical left groups: “Young people have no conception of the conspiracy’s strategy of pressure from above and pressure from below. . . . They have no idea that they are playing into the hands of the Establishment they claim to hate. The radicals think they are fighting the forces of the super rich, like Rockefeller and Ford, and they don’t realize that it is precisely such forces which are behind their own revolution, financing it, and using it for their own purposes.”
    Nicholas M. Butler, president of Columbia University, said to the Union League of Philadelphia: “The old world order died with the setting of the day’s sun and a New World Order is being born while I speak.” Butler was “J.P. Morgan’s chief spokesman for ivied halls.”
    Edward Bernays, chief advisor to William Paley, founder of CBS: “Those who manipulate the organized habits and opinions of the masses constitute an invisible government which is the true ruling power of the country. . . . It remains a fact that in almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons. . . . It is they who pull the wires which control the public mind, who harness old social forces and contrive new ways to bind and guide the world. . . . As civilization has become more complex, and as the need for invisible government has been increasingly demonstrated, the technical means have been invented and developed by opinion may be regimented.”
    Manly P. Hall, 33rd degree Freemason and a member of its inner circle, and probably the greatest Freemason of the twentieth century: “There exists in the world today, and has existed for thousands of years, a body of enlightened humans united in what might be termed, an Order of the Quest. It is composed of those whose intellectual and spiritual perceptions have revealed to them that civilization has secret destiny. The outcome of this ‘secret destiny’ is a World Order ruled by a King with supernatural powers. This King was descended of a divine race; that is, he belonged to the Order of the Illumined for those who come to a state of wisdom then belong to a family of heroes-perfected human beings.” He also wrote, “. . . It is beyond question that the secret societies of all ages have exercised a considerable degree of political influence. . . .”
    Winston Churchill admitted the existence of conspiracy when he wrote in 1920, “From the days of Spartacus-Weishaupt to those of Karl Marx, to those of Trotsky, Bela Kun, Rosa Luxemburg, and Emma Goldman, this worldwide conspiracy for the overthrow of civilization . . . has been steadily growing.”
    According to Lenin, the Communist Party could not survive without conspiracy. He wrote, “Conspiracy is so essential a condition of an organization of this kind that all other conditions . . . must be made to conform with it.”
    In a speech in 1931 before the Institute for the Study of International Affairs, the historian Arnold Toynbee said, “We are at the present working discreetly with all our might to wrest this mysterious force called sovereignty out of the clutches of the local nation states of the world. All the time we are denying with our lips what we are doing with our hands, because to impugn the sovereignty of the local national states of the world is still a heresy for which a statesman or publicists can perhaps not quite be burned at the stake but certainly be ostracized and discredited.”
    ABC commentator Cokie Roberts remarked, “Global bankers are really running the world.”
    James Warburg, son of Paul Warburg, the author of the Federal Reserve System: “We shall have world government whether or not you like it — by conquest or consent.”
    Benjamin Disraeli, Prime Minister of Great Britain: “The world is governed by very different personage from what is imagined by those who are not behind the scenes.”
    Benjamin Disraeli: “The governments of the present day have to deal not merely with other governments, with emperors, kings and ministers, but also with the secret societies which have everywhere their unscrupulous agents, and can at the last moment upset all the governments’ plans.”
    Franklinton Delano Roosevelt: “Nothing just happens in politics. If something happens you can be sure it was planned that way.”
    Franklin Delano Roosevelt: “The real truth of the matter is, as you and I know, that a financial element in the large centers has owned the Government ever since the days of Andrew Jackson.”
    Elliot Roosevelt, son of Franklin Roosevelt: “There are within our world perhaps only a dozen organizations, which shape the course of our various destinies as rightly as the regularly constitutional government.”
    William Colby, CIA Director: “Sometimes, there are forces too powerful for us to whip them individually, in the time frame that we would like. . . . The best we might be able to do sometimes, is to point out the truth and then step aside.”
     Gary Allen, a historian of conspiracies: “. . . many of the major world events that are shaping destinies occur because somebody or somebodies have planned them that way. If we were merely dealing with the laws of average, half of the events affecting our nation’s well-being should be good for America. If we were dealing with mere incompetence, our leaders should occasionally make a mistake in our favor. . . . we are not really dealing with coincidence or stupidity, but with planning and brilliance.”
    Andre Baron: “Remember that the constant rule of the secret society is that the real authors never show themselves.”
    If these quotations do not suggest a conspiratorial cabal, then the origins of the Federal Reserve System should. The essence of what eventually became the act that established the Federal Reserve System was written by Paul Warburg of Kuhn, Loeb and Co. Assisting him were  Henry P. Davison, senior partner of J. P. Morgan and Co.; Charles D. Norton, president of (Morgan’s) First National Bank of New York; Frank A. Vanderlip, President of (William Rockefeller’s) National City Bank of New York; Benjamin Strong, vice-president of (Morgan’s) Bankers Trust Co.; A. Piatt Andrew, Assistant Secretary of the Treasury; and Senator Nelson Aldrich, Morgan’s leading representative in Washington. This group met in secret in 1910 on Jekyll Island and drafted what eventually became the Federal Reserve System.
    The conspiratorial historians may be wrong, but the evidence strongly suggests that they are right.

Copyright © 2004, 2019 by Thomas Coley Allen.

More historical articles.
Part 1

The Silver Dollar 1873–1900 – Part 4

Gold Standard Act and Conclusion
Thomas Allen

[Editor’s note: Footnotes in the original are omitted.]

Gold Standard Act
With the enactment of the Gold Standard Act, the monetary system of the United States was formerly and clearly placed on the gold standard in 1900. This law declared that the gold dollar was the standard unit of value. It required the Secretary of the Treasury to maintain parity of all forms of money, which included the silver dollar and silver certificate. It provided for the redemption of U.S. notes and Treasury notes of 1890 in gold only and prohibited their reissue except in exchange for gold. Thus, it converted these Treasury notes, which had been used to buy silver, into government notes redeemable in gold. The law provided for silver certificates in small denominations to replace gradually the Treasury notes of 1890. Silver certificates were restricted to $10 and smaller. Also, it authorized the issuance of gold certificates, but unlike U.S. notes and gold coins, they were not made legal tender.

Although the Act did not affect the legal-tender status of the silver dollar (it remained full legal tender), it implied that by now the silver dollar had been reduced to credit money, a subsidiary coin for gold. It was no longer money in its own right. It had ceased being fiat money. The Secretary of the Treasury had to maintain the value of the silver dollar to equal a dollar in gold. He had to redeem silver dollars in gold if necessary to maintain parity.

As White notes, the silver dollar made an expensive fiat money.[1] However, it did limit the government’s ability to inflate much more than paper fiat money if the government decided not to maintain parity with gold. Its intrinsic value would be reached much sooner than paper. With silver, the government could only cut the value (purchasing power) of the currency by 25 to 50 percent. With paper, it could reduce the value to zero. At least the silver dollar gave the people some protection that the greenback never could.

Conclusion
Friedman and Schwartz sum up the silver dollar era:

The fear that silver would produce an inflation sufficient to force the United States off the gold standard made it necessary to have a severe deflation in order to stay on the gold standard. In retrospect, it seems clear that either acceptance of a silver standard at an early stage or an early commitment to gold would have been preferable to the uneasy compromise that was maintained, with the uncertainty about the ultimate outcome and the consequent wide fluctuations to which the currency was subjected.[2]

Although the last three decades of the nineteenth century were deflationary, this era was one of the greatest periods of economic growth for the United States.

A highly important question remains to be answered: Why did the gold value of silver decline so much after 1873?

Friedman and Schwartz assert that the supply of and demand for silver explains its decline, “The reasons for the price decline seem fairly clear: on the supply side, rich new mines were opened in the American West, and there was a world wide increase in productivity; on the demand side, a number of European countries shifted from a silver or bimetallic to a gold standard and sharply reduced their monetary use of silver.”[3]

The monometallists, advocates of the single gold standard of this era, claim that the increase in the supply of silver caused its fall in value. However, the fall in value began before the world’s silver stock had greatly increased. Moreover, gold production was much greater than that of silver. To which the monometallists reply that the fall resulted from an anticipation of an increase in supply.

Even today, the supply argument seems weak. In recent years (decades), the increase in the supply of gold has been greater than that of silver. During this time, the demand for silver seems to have been much higher as its usage has been higher. Yet the value of silver generally lags that of gold.

Laughlin opines that the abundance of gold caused silver to lose value relative to gold.[4] With the discovery of gold in America, enough gold became available to supplant silver coins. People preferred gold to silver because it had more value per unit weight. As the demand for gold grew, so did its value. As the demand for silver fell, so did its value. Moreover, the supply of silver began increasing after 1872.

The bimetallists, advocates of the silver-gold system with a legally fixed exchange rate between the two, claim that “demonetization” caused silver’s fall in value. They point to Germany ending the free coinage of silver in 1871, which glutted the market with silver. This action forced France and the other members of the Latin Union to abandon the silver standard, i.e., to end the free coinage of silver. The United States ended the free coinage of silver in 1873. During the 1870s other European countries ended their silver standards or bimetallic silver-gold system and adopted the monometallic gold standard. To the bimetallists, ending the free coinage of silver and by that discontinuing the use of silver as standard money caused its decline in value.

One result of discarding the silver standard was an increase in demand for gold coins. This increased demand for gold coins would account for some of the decline in the value of silver in terms of gold. Not only were countries replacing the silver standard with the gold standard, but they were also replacing fiat paper monetary standards with the gold standard.

Friedman and Schwartz opine that if the United States had reverted to the silver standard, the deflation of the 1880s and ’90s would have been avoided or at least moderated. Inflation would not have occurred. Prices would have remained stable.

The abandonment of the silver standard around the world reduced the demand for silver. As countries moved onto the gold standard, the demand for gold increased. Thus, the value of silver was pushed down and that of gold was pushed up.

If the United States had gone onto the silver standard, they would have abated much of the value change between the two metals. While reducing the demand for gold, they would have increased the demand for silver. If the United States were on the silver standard, other countries then on the silver standard might have remained on the silver standard instead of converting to the gold standard. Increasing the monetary demand for silver and decreasing it for gold would have greatly lessened the rise in the value of gold and the fall in the gold value of silver. Thus, the deflation during this era would have been significantly diminished if not eliminated.[5]

Although silver ceased to be used as standard money in most countries (China and some Latin American countries being notable exceptions), it was still used in subsidiary coins in most countries and as fiat money in the United States. If merely ending the use of silver as standard money caused its fall in value, why did gold soar in value (in terms of standard fiat currencies) when its last legal connection to money was severed in 1971? Whatever explanation used to explain silver decline in value after 1873 needs to be able to explain gold's rise in value after 1971.

(Charles Rist offers this explanation for why silver’s value declined and gold’s value rose when their free coinage ended. When the free coinage of silver ended, people replaced silver with gold. Gold adequately performed all the basic functions of money. Silver was not needed to perform any of these functions. Therefore, the monetary demand for silver declined. As demand fell, so did its value. When the free coinage of gold ended, people replaced gold with irredeemable paper money. Irredeemable paper money does not perform all the basic functions of money. As it nearly always depreciates in value, it fails as a store of value. Gold continued to perform a monetary function as a store of value. Therefore, a monetary demand for gold remained after its free coinage ended. Thus, when gold replaced silver, it fulfilled all of silver’s monetary functions. When irredeemable paper money replaced gold, it failed to fulfill all of gold’s monetary functions.[6])

The pro-silver folks are not the sole blame for the deleterious effects of the silver dollar. For the most part, they did not want fiat silver money. They wanted commodity silver money. They wanted to open the mint to the free coinage of silver.

Most of the blame belongs to the pro-gold and anti silver folks. To thwart the pro-silver folks’ attempt to allow the free coinage of silver, the pro-gold faction compromised. These compromises resulted in the Bland-Allison Act and the Sherman Act. Thus, the pro-gold folks were mostly responsible for the detrimental effects of fiat silver money between 1878 and 1900.

Politics prevented them from completely abandoning silver as legal tender. Allowing the free coinage of silver at the then-legal ratio of 16 to 1 would have reverted the country to the silver standard. Ardently, they opposed the silver standard; they wanted the gold standard that most of the world was on or moving toward.

Instead of compromising by making silver fiat money, the pro-gold should have compromised by allowing the free coinage of silver and raising the legal ratio above the market ratio. That would have preserved the gold standard until the legal ratio fell below the market ratio. However, when amendments were offered to change the ratio, they were voted down. Even better than changing the ratio, would have been to eliminate it. Elimination of the ratio was never seriously considered.

Many politicians of this era suffered from the same false delusion that has inflicted politicians throughout the ages. The ancient myth that the king’s (Congress’) edict gives money its value enthralled many of these politicians. Congress’ decree could force both gold and silver coins to circulate together at the current ratio of 16 to 1. After all, Congress had declared them to have an equal value at this ratio.

Not all politicians suffered from this superstition. Many knew that free coinage of silver at the current legal ratio of 16 to 1 would cause overvalued silver to circulate and send gold into hiding or to Europe. Most inflationists and pro-gold folks knew this outcome. It is this outcome that the inflationists wanted. It is this outcome that the pro-gold folks did not want.

In Open Mints and Free Banking, William Brough gave the best solution to the silver problem. His solution was to eliminate the legal exchange ratio and open the mint to the free coinage of silver. Thus, the mint would coin all gold and silver brought to it for coinage. Eliminating the ratio and allowing the free coinage of silver would have allowed the people themselves to decide how many silver coins and gold coins that they wanted. Both coins could have circulated together without either driving the other out of circulation. Both could have circulated side-by-side without the inflation and following depression caused by the Treasury notes of 1890. If Congress had adopted Brough’s recommendation, it would have eliminated most of the problems associated with silver in between 1878 and 1900. The most likely outcome would have been silver coins being used for day-to-day retail buying and selling and for wages. Gold would have been used for the export-import business, large purchases and investments, and long-term savings. The drain on the Treasury’s gold would have been significantly lessened. As no legal exchange rate existed between gold and silver, Gresham’s Law would not have been at work converting overvalued silver into gold for export as occurred under the Bland-Allison Act and especially under the Sherman Act. The money supply would have more closely matched the actual needs of the people.

Four other changes were also desirable. First, U.S. notes, greenbacks, should have been permanently removed from circulation as they were redeemed for gold or paid into the Treasury. Second, bank notes should have been issued based on and backed by real bills of exchange instead of U.S. governmental securities. Third, the U.S. government should have ceased issuing gold and silver certificates and should have retired those redeemed. Banks and other private institutions should have assumed the task of issuing gold and silver certificates. Fourth, all legal tender laws should have been repealed.

An argument used by the silverites was that the U.S. government should not discriminate against either metal. As long as it had a legal ratio, it would always discriminate against the undervalued metal in favor of the overvalued metal. At 16 to 1, silver was overvalued and gold was undervalued. At this ratio, silver coins would have quickly replaced gold coins in circulation. If the silverites really wanted to eliminate discrimination, they should have supported the elimination of the legal exchange ratio. Then the markets would have decided how many coins of each metal were needed. As they wanted to maintain the ratio of 16 to 1, they wanted the U.S. government to discriminate against gold. If the silverites wanted silver money for the sake of having silver money, they would have accepted an offer to eliminate the legal ratio. If it were currency depreciation that they wanted, they would have rejected the offer. As the offer seems never to have been made, we may never know for sure their preference. However, based on their comments and actions, they probably would have rejected the offer.

According to Rothbard, the silver movement destroyed the hard money, limited government, laissez-faire political party, the Democratic party of Jefferson, Jackson, and Cleveland.[7] It ushered in an era, which continues to this day, of statist control of both the Republican and Democratic parties. Until 1896, the Democratic party stood for limited government with minimal governmental intervention in economic and social affairs. For the Democrats, remaking man was not a function of government.

The Republican party was the party of the progressives, pietists, and Hamiltonians (advocates of central banking, governmental protection and promotion of big business, and protective tariffs). It sought to use government to mold man into perfection. It was the party of the greenback and inflation, prohibition of liquor, the public school system to remake mankind, blue laws, Protestantization of Catholics, and high tariffs. “. . . the Republicans glorified in calling themselves throughout this period [i.e., last half of the nineteenth century] ‘the party of great moral ideals,’ while the Democrats declared themselves to be ‘the party of personal liberty.’”[8]

After Cleveland won in a landslide in 1892 and the Democrats captured both houses of Congress, the Republican party had to remake itself or remain a minority party. It remade itself. It abandoned the prohibitionists, modified its immigration policy, and moved toward the center away from its extreme pietism.

Meanwhile, the Democratic party began to fractionalize. Pietism had come into the party in the South with a call for prohibition. In the West where the silver mines were, the Democrats adopted a pro-silver stance. Moreover, people blamed Cleveland for the Panic of 1893 although it resulted from the actions of the Republican Harrison administration. Seeing that the hard-money laissez-faire Cleveland faction was weak, the pietist faction in the South and the silverites in the West united under William Jennings Bryan to gain control of the Democratic party. Thus, the progressives, pietists, and Hamiltonians gained complete control of the Democratic party, which was once the party of liberty, and have never since loosened their grip.

J.P. Morgan and other financiers through Henry Cabot Lodge offered to support the Republican party if it supported the gold standard, which was Cleveland’s basic economic issue. Otherwise, they would support Bryan. William McKinley accepted the deal, and the Republican party abandoned its traditional easy money policy.

The pietist-silverite takeover of the Democratic party caused many Democrats to sit out the election. Others voted for McKinley. Since the election of McKinley, both parties and all presidents have been statists and progressives in varying degrees. Voter turnout has trended down ever since.

The most devastating and long-lasting effect of the silver dollar fiat money was the utter destruction of a party of liberty in the United States. Since 1896, no party advocating laissez-faire economics, limited government, personal responsibility, and personal liberty has won the presidency or taken control of either house of Congress. Only a few such candidates have won congressional elections. State governors and legislatures have not fared any better.

[Editor’s note: The appendix, which contained eight tables of monetary statistics, and the list of references are omitted.]

Endnotes
1. Horace White, Money and Banking (Boston, Massachusetts: Ginn & Company, 1896), p. 204.

2. Milton Friedman and Anna Jacobson Schwartz, A Monetary History of the United States, 1867-1960 (Princeton, New Jersey: Princeton University Press, 1963), pp. 133-134.

3. Ibid., p. 114.

4. J. Laurence Laughlin, The Elements of Political Economy (New York, New York: American Book Co., 1887), p. 311.

5. Friedman and Schwartz, p. 134.

6. Charles Rist, The Triumph of Gold, trans. Philip Cortney (New York, N.Y.: Philosophical Library, 1961, pp. 122-124, 151-153.

7. Murray N. Rothbard, A History of Money and Banking in the United States: The Colonial Era to World War II (Auburn, Alabama: Ludwig von Mises Institute, 2005), pp. 175-179.

8. Ibid., p. 174.

Copyright © 2010 by Thomas Coley Allen.

Part 3

More articles on money. 

 

The Silver Dollar 1873–1900 – Part 3

Sherman Act
Thomas Allen

[Editor’s note: Footnotes in the original are omitted.]

In 1890, Congress enacted the Sherman Act or the Silver Purchasing Act of 1890. It authorized the Department of the Treasury to issue notes (Treasury notes of 1890) to buy silver. They were full legal tender and redeemable in gold or silver at the discretion of the Secretary of the Treasury.

The law ordered the Secretary of the Treasury to buy silver at the market price with Treasury notes until silver reached $1.29 per ounce, the price of silver at which the ratio of silver to gold is 16 to 1. It required him to buy 4.5 million ounces of silver each month at the market price. This silver served as a reserve for the Treasury notes. Silver dollars were only minted when necessary to redeem Treasury notes. Under the Sherman Act, the U.S. government bought 168 million ounces of silver. Of this silver, 28 million ounces were coined into $36 million silver dollars. $156 million in Treasury notes were issued.[1]

The Sherman Act sought to drive the price of silver up by having the U.S. government buy most of the silver produced in the United States. It failed in this objective. Silver continued to decline in terms of gold.

As a result of the Sherman Act, new legal tender notes, Treasury notes of 1890, flooded the markets. People began redeeming these notes in gold and exporting the gold. Large quantities of gold were shipped overseas, and the Treasury’s reserves of gold coins and bullion became dangerously low. People also substituted the new Treasury notes for gold coins in their daily commerce and exported the gold coins.

The Sherman Act differed significantly from the Bland-Allison Act in at least one important aspect. Under the Sherman Act, the Secretary of the Treasury bought a specific number of ounces of silver each month. The Bland-Allison Act required the Secretary to buy between $2 million and $4 million of silver each month. Thus, the Sherman Act was in terms of ounces of silver, and the Bland-Allison Act was in terms of the cost of silver. Therefore, under the Sherman Act, “the annual additions to the currency would grow less if the price of silver fell, while by the Bland[-Allison] Act the annual additions grew larger as the price of silver fell.”[2]

Silver dollars issued under the Bland-Allison Act did not have the same effect as the Treasury notes of 1890. During the 1880s, banks contracted their bank notes because the supply of U.S. government securities was shrinking and their prices were rising. Banks had to use U.S. government securities as collateral for their bank notes. Thus, silver dollars issued in the 1880s approximated the contraction of bank notes and merely filled the void left by bank notes. By 1890, the quantity of bank notes stabilized. The Treasury notes of 1890 were an addition to the money supply and not a substitute of one form of money for another. Being an addition, people redeemed the Treasury notes in gold and exported the gold to countries where its monetary use was more valuable. Silver dollars and Treasury notes of 1890 were legally equal to gold in the United States in purchasing power. However, gold had a higher purchasing power in the world markets than silver dollars or the Treasury notes.

Silverite opponents of the Sherman Act identified several flaws in the Act. It was written in a way to cause large quantities of silver dollars to end up in the Treasury’s vault. It required the Secretary of the Treasury to buy silver bullion and then to coin an adequate supply of silver dollars to redeem outstanding Treasury notes. (Later, when President Cleveland convened Congress to repeal the purchasing provision of the Act, he pointed to the large quantity of silver coins and bullion in the Treasury as proof that the people did not want silver money. The major reason for this large hoard of silver coins was that the Secretary of the Treasury always redeemed Treasury notes in gold unless the person redeeming specifically asked for silver. Furthermore, most people preferred using paper money rather than coins.)

Another flaw was that it set a maximum price of one dollar per 371.25 ounces of fine silver that the Secretary of the Treasury could pay for silver. However, it did not set a minimum price. Opponents saw fixing a maximum price with no minimum price as a means to suppress the price of silver. Moreover, the Act fell far short of buying the annual production of U.S. silver mines.

The Act authorized the Secretary of the Treasury to redeem Treasury notes in gold or silver instead of gold and silver. Thus, the Act gave the Secretary too much discretion.

Furthermore, the parity clause was written such that it could be construed to require the U.S. government to guarantee the bullion value in the silver dollar should its value be less than a dollar in gold. This construct made the silver dollar credit money redeemable in gold. (This construct is exactly what the pro-gold anti-silverites wanted.)

Supporters of the Sherman Act believed that it would stimulate business by increasing the money supply. Moreover, it would do so without inflation.

The Treasury notes of 1890 are commonly blamed for the Panic of 1893 and the depression that followed. As more notes were redeemed for gold and the gold exported, people in the United States and Europe began to lose confidence in the U.S. dollar. They feared that the U.S. government might not continue to redeem Treasury notes and greenbacks in gold.

They saw the New York subtreasury settling its clearing house balances in greenbacks and Treasury notes instead of gold. When the Treasury began imposing a fee on exporting bars of gold taken from its vaults, which caused gold coins to be exported instead of gold bars, more confidence was lost. Banks began inserting clauses in loans and mortgages to require payment in gold.[3]

The new Secretary of the Treasury fed these doubts when he expressed concerns about being able to continue to redeem Treasury notes in gold. He stated the next day that Treasury notes would be redeemed in gold under all circumstances, but the damage done could not be undone.

Furthermore, the Treasury’s gold reserve fell below $100 million, which was considered the minimum backing for U.S. notes. When the Treasury’s gold reserve fell below $100 million, the Secretary of the Treasury, as required by law, stopped issuing gold certificates. This action fed the fear that Treasury notes of 1890 would not be redeemed in gold. This news was followed by India’s abandoning the silver standard, which sent the gold price of silver down sharply.

The Sherman Act had made a mockery of the silver dollar. Treasury notes were used to buy silver bullion, which backed the Treasury notes. This silver bullion was to be coined into silver dollars for redemption of Treasury notes. However, the Act gave the Secretary the discretion to redeem Treasury notes in gold or silver. Unless the person presenting the notes requested silver, the Secretary always redeemed them in gold. Most people expected that he would redeem them in gold.

If the Act had not given the Secretary the discretion to redeem Treasury notes in gold and had required him to redeem them in silver, the drain on the Treasury’s gold reserve would have been greatly lessened. Treasury notes would have been treated like silver certificates.

In short, people feared that the United States were going to leave the gold standard. This fear resulted in the Panic of 1893. To assuage this fear, Congress repealed the silver purchasing provisions of the Sherman Act in 1893.

Silverites saw the repeal of the purchasing provision of the Sherman Act as a deliberate attempt to eliminate silver as money in its own right. Walbert expresses the real motivation for the repeal, “It appears, therefore, that the sole object of repealing the purchasing clause of the Sherman law was for the express purpose of depriving silver of its only support, thus lowering its value, and thereby furnishing reasons against its use as money.”[4]

A year before the Panic of 1893, major New York City banks were lobbying rural banks to support them in getting the Sherman Act repealed. Coercion was used against the rural banks as the New York City banks refused to rediscount their bills unless they supported the repeal of the Sherman Act.[5] Opportunity came for the repeal when the Panic hit a year later. (How much involvement did these banks have in causing the Panic so that they could use it to get the silver purchasing requirement repealed? Some believe that the New York City bankers deliberately caused the Panic by creating a loss of confidence in their own banks. They also sent out circulars to banks and businesses forecasting economic doom if the Sherman Act was not repealed.[6])

After the Panic hit and President Cleveland convened Congress to repeal the silver purchasing provision, the New York City banks applied pressure on Southern and Western bankers to support the repeal. The New York City banks informed these bankers that they could expect no money from New York until the purchasing provision was repealed. Moreover, the New York City banks appeared to have conspired not to lend to merchants until the silver purchasing provision was repealed. They had plenty of money in their vaults for loans.[7]

The Panic of 1893 ended with the repeal of the silver purchasing provision of the Sherman Act. A depression that lasted until June 1894 followed. Another depression occurred from October-December 1895 to June 1897 (some place the end as early as October 1896). (Some economists consider the entire period 1893-1897 as a major depression.)

As a result of the Panic, business activity slackened, and the demand for money fell. Excess money accumulated in bank vaults. This excess money became available for speculation in the stock and commodity markets. This speculation led to a rise in commodity prices in the United States. Consequently, commodities were imported and gold was exported, which caused gold reserves to shrink even more. The Secretary of the Treasury was forced to pay out more currency than he received — thus, contributing to the inflation. He sought to raise the gold reserves of the U.S. government by selling bonds. However, this action created concerns that the Treasury might not be able to continue redeeming paper money in gold. People began redeeming their paper money at an accelerated rate because they feared that the U.S. government was on the verge of bankruptcy.

(The major argument for the repeal of the silver purchasing provision was to stop the drain of gold from the Treasury and the country. However, the drain continued unabated. About the repeal of the Sherman Act and the gold drain, Walbert states:

It was further stated that the repeal of the Sherman law was necessary to prevent the exportation of gold from the United States. This was another hypocritical plea to aid in the passage of the repeal, for, in a single year after that act was consummated, one hundred and twenty millions of dollars in gold were drawn out of the Treasury by that set of knaves who had urged repeal as a means to protect the gold reserve.[8])

Moreover, when the New York City banks bought the bonds, they did not buy them with their gold. They redeemed Treasury notes for gold and used that gold to buy bonds. “Therefore, while these banks were demanding issues of bonds to maintain the public credit, they utilized this very issue as a means to further deplete the Treasury of its gold.”[9]

Finally, in January 1895, the Secretary of the Treasury entered into an agreement with a syndicate of bankers led by J.P. Morgan and August Belmont, both of whom were associates of the Rothschilds. (Belmont was acting on behalf of N.M. Rothschild & Sons.) The bankers would buy $65,117,500 of bonds paid for with gold. (They bought $62,315,500.) Half of this gold was to come from Europe (this part of the agreement was later ignored, which caused a reduction in the U.S. money supply). The bankers were to use their influence to prevent the withdrawal of gold from the Treasury. These bankers made the exporting of gold unprofitable by controlling the rate of foreign exchange. This agreement improved the situation temporarily. However, the threat of war between Great Britain and Venezuela in 1895 led to more redemptions and exports of gold.[10] Finally, in August 1896, the monetary system stabilized and the export of gold ceased. $33 million in gold had been withdrawn in excess of that needed for export.[11]

Were banks deliberately withdrawing gold from the Treasury to force the U.S. government to sell bonds to restock its gold reserves? An editorialist of the New York World, who was an advocate of the gold standard, believed that they were. He wrote:

The banks have no apparent use for gold.

They have absolutely no obligations of any kind, near or remote, which are payable in gold.

Nevertheless these banks are hoarding gold in large quantities, at a time when to do so is to subject the Government to heavy and needless expense.

Thus the clearing house banks of New York alone, hold over $81,000,000 in gold for which they have no use. . . .

If they should turn it into the Treasury and take greenbacks instead, they would be in every respect as well equipped as now to meet their obligations, while the Government would not have to issue another $100,000,000 of bonds, which it will cost the country $220,000.000 to pay, principal and interest.

Are they serious expecting gold to go to a premium?

Or are thy and the banks all over the country in a tacit “combine” to compel repeated bond issues for their speculative profit? These banks ought to answer these questions.[12]

As a result of the Sherman Act, between July 1890 and July 1893, $156 million in Treasury notes were issued, and $160 million in gold were exported. The gold reserve of the Treasury fell from $184 million to $84 million (October 1893). In 1893 the United States government held $150 million less gold than it would have if the Sherman Act had not been enacted. From 1890 to 1896, the net export of gold was $269 million.[13]

A criticism that the silverites hurled at President Cleveland was that the Treasury held $147,000,000 in silver dollars and bullion when he convened Congress to repeal the silver purchasing provision. At the same time, money brokers and banks in New York City were buying silver dollars and silver certificates at a premium.[14] To the silverites this was proof that whatever the cause of the problem was, it was not too much silver money in circulation. This was proof that too little was in circulation. The real reason that the Treasury held so much silver was to back silver certificates and Treasury notes in circulation. (President Cleveland implied that the Treasury held this silver because people did not want silver money.)

The silverites opposed the Treasury selling bonds to replenish its gold reserve. They claimed that the Treasury had an abundantly available surplus of specie. In the Treasury was nearly $300 million in silver. The Secretary of the Treasury just needed to use silver.

Furthermore, failure to use silver violated the policy set out in the Sherman Act, which was “to maintain the two metals at a parity.”[15] It also violated the policy of the Act of 1893, which “‘declared that the efforts of the government should be steadily directed to the establishment of such a system of bimetallism as will maintain at all times the equal power of every dollar coined or issued by the United States in the markets in the payment of debts.’”[16]

The Sherman Act added a great deal of money to the U.S. economy that was not needed. It caused silver to be used domestically and gold to be exported. Without the Sherman Act, any shortage of money in the United States would have been overcome by the importation of gold.[17]

Most of the gold withdrawn from the Treasury came from the redemption of greenbacks. As the Treasury was short on gold, it was forced to payout these greenbacks as quickly as they were received. These greenbacks were soon redeemed again. Thus, the Treasury was in a cycle of having to redeem continuously the same greenbacks.

Although the greenback appeared to be the culprit causing the Treasury’s loss of gold, it was not. The real culprit was the inflation caused by the Treasury notes of 1890 and the U.S. government’s deficit.[18]

About the role of silver in the Panic of 1893, Fels writes:

How much difference did silver make? An element of speculation must enter into any judgment, but the following three statements seem justified, (1) The threat to the gold standard made the contraction more rapid and violent during the months of March through August. (2) If the silver problem had never entered the picture at all, the contraction after August would have been more rapid. This follows from the fact that money stringency bunched failures that would have occurred sooner or later anyway. (3) The silver situation probably resulted in deeper contraction by causing failures among firms and banks that could have survived if the kind of money market characteristic of cyclical contractions had prevailed. The evidence for this lies in the high ratio of assets to liabilities among the failures.

The preceding paragraph regards the silver problem as the variable, holding everything else constant. If one reverses the procedure, holding silver constant and inquiring how much difference the underlying business situation made, one might easily come to a different conclusion. The monetary and fiscal policies actually pursued, together with the banking structure, might have produced panic and severe depression in any event. The argument must be a bit arbitrary, since the result would have depended on how the President and Congress reacted to the emergency; but in the political situation of 1893 nothing short of disaster would probably have sufficed to make effective action possible. In this sense, one can assign the leading role to monetary factors, which would have caused strong firms to fail had there not been plenty of weak ones.[19]

The Sherman Act suffered the same constitutional flaws as the Bland-Allison Act. Under the Constitution, the U.S. government has no authority to issue paper money, to buy and coin silver on its own account, or to act as a deposit bank.

The silver dollars minted under the Bland-Allison Act and Sherman Act and the Treasury notes of 1890 were forms of fiat money. The silver content of the silver dollar was worth less than a dollar. The U.S. government bought silver on its own account and issued the silver coins. It decided how many to issue instead of the markets.

Opponents of silver blamed silver for the economic problems of the 1880s and especially the 1890s. They saw silver as a threat to the gold standard.

Friedman and Schwartz show that “until 1886, silver grew fairly slowly and the greater part of the increase in high-powered money consisted of gold. From then until 1893, silver grew rapidly, replacing gold almost entirely as a source of additional high-powered money. Thereafter, both silver and gold as well as total high-powered money fluctuated about a nearly constant level.”[20]

They continue:

From 1879 to 1893, the total of silver and Treasury notes of 1890 out-side the Treasury grew some $500 million, which is a measure of the strength of the silver forces. These purchases added to high-powered money and so contributed to an expansion of the stock of money. This is the effect that contemporaries pointed to as constituting a threat to the gold standard. But it is clear that the direct effect of the silver purchases on the stock of money did not, in fact, threaten the maintenance of the gold standard. In the first place, the growth in silver currency was offset to some extent by a reduction in national bank notes outstanding, a reduction enforced by debt retirement. In the second place, and more important, total high-powered money grew from 1879 to 1893 by $740 million or by $240 million more than the silver currency. In the absence of the silver purchases, the gold stock — or perhaps some other component of the money stock — would have risen more than it did.[21]

The threat to the gold standard came primarily from the actions of foreigners. Friedman and Schwartz note:

The threat to the gold standard came from the effects of the silver purchases on the willingness of foreigners to hold dollars. This evidence of the power of the silver forces discouraged the inflow of capital or produced speculative capital outflows of substantial magnitude and kept alive the possibility of very much larger outflows. The smaller inflows or actual outflows made for a lower rise in high-powered money than would otherwise have occurred, so that in their absence the growth in silver currency would have been a still smaller fraction of the total growth in high-powered money. Together with the measures taken in fear of potential outflows, they enforced monetary deflation to produce the requisite adjustments in the balance of payments. Paradoxically, therefore, the monetary damage done by silver agitation was almost the opposite of that attributed to it at the time. It kept the money stock from rising as much as it otherwise would have, rather than producing too rapid an increase in the money stock.[22]

After the 1896 election and the defeat of the silverites, the clamor for the free coinage of silver faded away as the economy improved. Prices rose as the world gold stock grew. In 1900, the free coinage of silver and the silver standard was finally killed with the Gold Standard Act.

Endnotes
1. Richard T. Ely, An Introduction to Political Economy (Revised edition; New York, New York: Eaton & Mains, 1901), p. 188. White, p. 204.

2. Davis Rich Dewey, Financial History of the United States (1922; reprint. New York, New York: Longmans, Green and Co., 2005), p. 438.

3. Murray N. Rothbard, A History of Money and Banking in the United States: The Colonial Era to World War II (Auburn, Alabama: Ludwig von Mises Institute, 2005), p. 168.

4. M.W. Walbert, The Coming Battle: A Complete History of the National Banking Money Power in the United States (1899; reprint. Merlin, Oregon: Walter Publishing & Research, 1997), p. 288.

5. Ibid., p. 281.

6. Ibid., pp. 281-282, 285-286.

7. Ibid., pp. 300-301.

8. Ibid., p. 306.

9. Ibid., p. 335.

10. Joseph French Johnson, Money and Currency: In Relation to Industry, Prices, and the Rate of Interest (Revised edition; Boston, Massachusetts: Ginn and Company, 1905), pp. 356-359. Walbert, pp. 337-340. Horace White, Money and Banking (Boston, Massachusetts: Ginn & Company, 1896), pp. 211-212.

11. White, p. 211.

12. Walbert, pp. 333-334.

13. Johnson, pp. 358-359.

14. Walbert, p. 273.

15. Dewey, p. 452.

16. Ibid., p. 452.

17. White, p. 209.

18. Johnson, p. 359.

19. Rendigs Fels, American Business Cycles 1865-1897 (Chapel Hill, North Carolina: The University of North Carolina Press, 1959), p. 188.

20. Milton Friedman and Anna Jacobson Schwartz, A Monetary History of the Untied States, 1867-1960 (Princeton, New Jersey: Princeton University Press, 1963), pp. 128, 131.

21. Ibid., p. 128.

22. Ibid., pp. 131-132.

Copyright © 2010 by Thomas Coley Allen.

Part 2 Part 4

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Two Views of History ‒ Part 2

Two Views of History ‒ Part 2
Thomas Allen

[Editor’s note: Footnotes in original are omitted.]

Some well-known Americans readily admit that an elite has conspired to control the United States. Supreme Court Justice Felix Frankfurter, “the outstanding power behind the New Deal,” remarked, “The real rulers in Washington are invisible, and exercise power from behind the scenes.”[1] At a dinner party, Frankfurter was asked who ran the United States; he replied, “The real rulers of a nation are undiscoverable.”[2]

John F. Hylan, mayor of New York, said, “The real menace of our Republic is the invisible government which like a giant octopus sprawls its slimly length over our city, state and nation. . . . At the head of this octopus are the Rockefeller-Standard Oil interests and a small group of powerful banking houses generally referred to as the international bankers [who] virtually run the U.S. government for their own selfish purposes.”[3]

After observing governmental leaders of the United States consistently making concessions to the Soviet Union, James Forrestal, the first Secretary of Defense, commented, “These men are not incompetent or stupid. They are crafty and brilliant. Consistency has never been a mark of stupidity. If they were merely stupid, they would occasionally make a mistake in our favor.”[4]

President-elect Ronald Reagan said, “I think there is an elite in this country and they are the very ones who run an elitist government. They want a government by a handful of people because they don’t believe the people themselves can run their lives. . . . Are we going to have an elitist government that makes decisions for people’s lives, or are we going to believe as we have for so many decades, that the people can make these decisions for themselves?”[5]

A few years after resigning as President, Richard Nixon wrote, “The nation’s immediate problem is that while the common man fights America’s wars, the intellectual elite sets its agenda. Today, whether the West lives or dies is in the hands of its new power elite: those who set the terms of public debate, who manipulate the symbols, who decide whether nations or leaders will be depicted on 100 million television sets as ‘good’ or ‘bad.’ This power elite sets the limits of the possible for President and Congress. It molds the impressions that move the nation, or that mire it.”[6]

Jim Kirk, who had been a member of the Students for a Democratic Society, Communist Party, and the Black Panthers, said about illuminist control of radical left groups, “Young people have no conception of the conspiracy’s strategy of pressure from above and pressure from below. . . . They have no idea that they are playing into the hands of the Establishment they claim to hate. The radicals think they are fighting the forces of the super rich, like Rockefeller and Ford, and they don’t realize that it is precisely such forces which are behind their own revolution, financing it, and using it for their own purposes.”[7]

Nicholas M. Butler, president of Columbia University, said to the Union League of Philadelphia, “The old world order died with the setting of the day’s sun and a New World Order is being born while I speak.”[8] Butler was “J.P. Morgan’s chief spokesman for ivied halls.”

Edward Bernays, chief advisor to William Paley, founder of CBS, wrote,

Those who manipulate the organized habits and opinions of the masses constitute an invisible government which is the true ruling power of the country. . . . It remains a fact that in almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons. . . . It is they who pull the wires which control the public mind, who harness old social forces and contrive new ways to bind and guide the world. . . . As civilization has become more complex, and as the need for invisible government has been increasingly demonstrated, the technical means have been invented and developed by which opinion may be regimented.[9]

Manly P. Hall, an occultist, Satanist, 33rd degree Freemason and a member of its inner circle, and probably the greatest Freemason of the twentieth century, wrote:

There exists in the world today, and has existed for thousands of years, a body of enlightened humans united in what might be termed, an Order of the Quest. It is composed of those whose intellectual and spiritual perceptions have revealed to them that civilization has secret destiny.

The outcome of this “secret destiny” is a World Order ruled by a King with supernatural powers.

This King was descended of a divine race; that is, he belonged to the Order of the Illumined for those who come to a state of wisdom then belong to a family of heros-perfected human beings.[10]

He also wrote, “. . . It is beyond question that the secret societies of all ages have exercised a considerable degree of political influence. . . .”[11]

Winston Churchill, a very high-degree Illuminist, admitted the existence of conspiracy when he wrote in 1920, “From the days of Spartacus-Weishaupt to those of Karl Marx, to those of Trotsky, Bela Kun, Rosa Luxemburg, and Emma Goldman, this worldwide conspiracy for the overthrow of civilization . . . has been steadily growing.”[12]

Quartier La Tente, a Freemason, said, “Freemasonry has undertaken a task and a mission. It is a question of nothing less than the reconstruction of society upon an entirely new basis.”[13]

Father Pedro Arrupe, the head of the Jesuit, and as such, an insider’s insider, said, referring to the atheistic conspiracy that had entered the Catholic Church, “This new godless society operates in an extremely efficient manner, at least in its higher levels of leadership. It makes use of every possible means at its disposal, be they scientific, technical, social, or economic. It follows a perfectly mapped-out strategy. It holds almost complete sway in international organizations, in financial circles, in the field of mass communications: press, cinema, radio, and television.”[14] As Arrupe notes, this conspiracy controlled international organizations, finance, and mass communications.

According to Lenin, another high-degree Illuminist, the Communist Party could not survive without conspiracy. He wrote, “Conspiracy is so essential a condition of an organization of this kind that all other conditions . . . must be made to conform with it.”

Another Illuminist, H.G. Wells, a Fabian, wrote, “. . . the unorganized people cannot achieve Socialism, they passed to the implication that organization alone, without popular support, might achieve Socialism. Socialism was to arrive as it were insidiously. . . . Socialism ceased to be an open revolution, and became a plot. Functions were to be shifted, quietly, unostentatiously, from the representative to the official he appointed; a bureaucracy was to slip into power. . . .”[15] According to Wells, socialism, be it welfare statism, democratic socialism, national socialism, fascism, or communism, can only be achieved by conspiracy. As every country on Earth now has some form of socialism, a conspiracy must have existed to achieved the socialization of the world.

In a speech in 1931 before the Institute for the Study of International Affairs, the historian Arnold Toynbee said, “We are at the present working discreetly with all our might to wrest this mysterious force called sovereignty out of the clutches of the local nation states of the world. All the time we are denying with our lips what we are doing with our hands, because to impugn the sovereignty of the local national states of the world is still a heresy for which a statesman or publicist can perhaps not quite be burned at the stake but certainly be ostracized and discredited.”[16] Thus, conspiracy would be used to destroy national sovereignty because the people would not knowingly tolerate the destruction of nation states on the altar of Illuminism and its New World Order. The primary tactic being used to destroy the nation state is immigration.

Gary Allen, a conspiracy scientist, summarized these comments about Illuminism when he wrote, “. . . many of the major world events that are shaping destinies occur because somebody or somebodies have planned them that way. If we were merely dealing with the laws of average, half of the events affecting our nation’s well-being should be good for America. If we were dealing with mere incompetence, our leaders should occasionally make a mistake in our favor. . . . [W]e are not really dealing with coincidence or stupidity, but with planning and brilliance.”[17]

ABC commentator Cokie Roberts remarked, “Global bankers are really running the world.”[18]

As shown by the above quotations, world leaders and leaders of secret societies with inside information admit that the conspiratorial explanation of history is correct.

Endnotes
1. Jim Marrs, Rule by Secrecy: The Hidden History That Connects the Trilateral Commission, the Freemasons, and the Great Pyramids (New York, New York: Harper Collins Publishers, 2000), p. 13.

2. Dennis L. Cuddy, The Globalists: The Power Elite Exposed (Oklahoma City, Oklahoma: Hearthstone Publishing, 2001), p. 94.

3. Marrs, pp. 13-14.

4. Marrs, p.15.

5. Cuddy, Globalists, pp. 151-152.

6. Dennis L. Cuddy, Secret Records, The Man, the Money, & the Methods Behind the New World Order (Oklahoma City, Oklahoma: Hearthstone Publishing, 1999), p. 124.

7. Cuddy, Globalists, p. 123.

8. Cuddy, Globalists, p. 34.

9. Cuddy, Secret Records, pp. 45-46.

10. Terry Melanson, “Illuminati Conspiracy, Order of the Illumined Wise Men,” www.conspiracyarchives.com/NWO/Illuminati.htm, Dec. 13, 2002.

11. James W. Warner, Unholy Alliances: The Secret Plan and the Secret People Who Are Working to Destroy America (James W. Wardner, 1996), p. 88.

12. Marrs, p. 193.

13. Vicomte Leon de Poncins, Freemasonry and the Vatican: A Struggle for Recognition (Translator Timothy Tindal-Roberston. London, England: Briton Publishing Co., 1968), p. 45.

14. Cuddy, Globalists, p. 118.

15. Cuddy, Globalists, pp. 26-27.

16. Robert H. Goldsborough, “The Planned Destruction of Sovereignty,” Middle American News, December 2003, p. 8.

17. Gary North, Conspiracy: A Biblical View (Ft. Worth, Texas: Dominion Press, 1986), p. 8.

18. Cuddy, Secret Records, p. 163.

Copyright © 2010 by Thomas Coley Allen.

Part 1, Part 3

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Education

Education
Thomas Allen

[Editor’s note: Footnotes in the original are omitted.]

Illuminists have used their money to gain control of education. They have used their control to further their interest and to foster Illuminism. They are well aware of Lenin’s dictum: “Give us the child for eight years, and it will be a Bolshevik forever.”[1]

Through large endowments, J.P. Morgan and other wealthy Illuminists gained control of policies of the Ivy League universities. Morgan and his associates dominated policy making at Harvard, Columbia, and, to a lesser extend, Yale. The Whitneys were significantly influential at Yale. Edward D. Duffield of Prudential Insurance Co. dominated Princeton. These wealthy men often decided who would be president of these universities. The Illuminists, primarily with Rockefeller money, have also gained control of most of the schools that train teachers. With their money, they also control the major seminaries—thus, they control the training of most ministers.

Carnegie and Rockefeller money has been used to gain control of American schools, both at the university level and at the secondary and primary grade level. Carnegie and Rockefeller money has funded curricula and textbooks whose purpose has been to indoctrinate students in Illuminism and to train them to support Illuminism.

Textbooks have been revised and rewritten to present the subject matter from a Marxist or other illuministic perspective. They promote globalism; “good” has become equated with globalism. Such revisions frequently require the omission of valuable and important facts. They often misstate facts and even outright lie. Even dictionaries have been rewritten to define certain words in ways to incorporate illuministic bias.

The Rockefeller Foundation and Carnegie Corp. financed John Dewey’s socialist philosophy. Dewey was the father of “progressive education,” which became the dominant educational philosophy in the United States. As an atheist and coauthor of the Humanist Manifesto, he preached against immutable truths and permanent moral absolutes. Pragmatism and relativism were his guiding philosophy. He believed that man had no soul or freewill. Man was merely an animal molded by his environment. As man’s environment constantly changed, so man constantly changed. Therefore, to teach absolute morals and truths was a waste of time.

He sought to turn the school house into a temple of the religion of secular humanism. To Dewey, individual judgment was socialism’s greatest enemy, so he worked to replace proven educational programs with programs designed to make a more controllable society. The primary goal of education was to destroy a child’s individualistic traits. The ability of a pupil to become one with the group became the primary measure of a pupil’s educational progress. Students were to be trained to live and work collectively. Thus, pupils were discouraged from trying to advance faster than the lowest member of the group. As grading promoted competition, it was to be abandoned. Promotion was to be automatic.

The purpose of schools was not to develop the student’s talents. It was to prepare the student to integrate into an organic society, the global community. Thus, the student’s “cosmic soul” was to become one with the human race.

Dewey taught David and Nelson Rockefeller. He also organized the educational system of the Soviet Union.

With money from the Rockefeller Foundation and Carnegie Corp., Illuminists have financed and controlled the National Education Association (NEA). “By 1934 the NEA adopted John Dewey’s philosophy of humanism, socialism, and globalism, and incorporated it into the classroom.”[2]

To consolidate complete control over public education in the United States, Nelson Rockefeller created and ran the Department of Health, Education, and Welfare during the Eisenhower administration. (The educational functions of this department were later moved into a new department, the Department of Education during the Carter administration.) Thus, Eisenhower accomplished what Truman had failed to do. (Truman had tried several times to get Congress to create the Department of Health, Education, Welfare, but Republicans and conservative Democrats prevented its creations. Eisenhower got most of the Republicans to join the liberal Democrats in establishing this department.) Through federal grants, the United States government, which the Illuminists thoroughly control, has gained complete control of the public schools.

UNESCO (United Nations Educational, Scientific and Cultural Organization) is another important tool of the Illuminists in directing education (schooling) not only in the United States, but throughout the world for the benefit of the Illuminists. The objective of UNESCO is to train children to be citizens of the world. To achieve this goal, their love of their country, institution, and own people along with patriotism must be destroyed. Thus, children are to be conditioned to transfer their loyalty from their country to a one-world socialistic government under the United Nations, which the Illuminists will control. UNESCO has also promoted keeping children separated from parents as much as possible. The minds of children must be purged of any national or family loyalties (and if their parents are Christians or even nominal Christians, of any Christian thoughts) before they can be molded into non-thinking citizens of the world. (Christianity, nationalism, and family loyalty are antagonists of globalism and Illuminism.) Accordingly, governments establish preschool programs like kindergarten and Head Start. Governments promote working mothers and warehousing children in daycare centers. As part of its program to destroy nationalism, UNESCO also promotes teaching children enmity toward their domestic institution unless these institutions are already compatible with Illuminism. (Thus, to make the merger of the United States into this one-world government easier, their Constitution and relatively free market economy must be destroyed. The destruction of these institutions has been a major goal of government schools.) History is to be taught from a global perspective instead of a national perspective. Consequently, UNESCO also promotes keeping children ignorant of national history and domestic institutions of their own countries and other countries and of the horrors of Communism and failures of socialism— ignorant people are easier to control. The achievements and greatness of Christianity, Western Civilization, and the Aryan race are to be disparaged if not denounced. UNESCO promotes turning schools into doctrinarian centers for Illuminism (globalism, socialism, New Age religion, one-world government). To destroy further traditional morality, loyalties, and family, UNESCO promotes abortion, homosexuality, prostitution, and miscegenation. The essence of UNESCO’s program is Dewey’s progressive educational theory.

Public (government) schools have become temples of the New Age religions where children are proselytized. Children are taught secular humanism, worship of Gaia, witchcraft, Theosophy, and other New Age pantheistic religions. The purpose of public schools is to proselytize for New Age religions, the “religion of humanity that recognizes and respects the spark of what theologians call divinity in every human being.”[3] Belief in the God of the Christians is mental illness. Public schools are to replace “the rotting corpse of Christianity together with all its adjacent evils and misery”[4] with the new faith, which is really the old Luciferian religion of man as god. They are to take children away from their parents and heal them by purging their psyches of all taints of Christianity. (Consequently, public schooling is moving to an ever younger age with the objective of having every child two years of age and older under the control of government, which the Illuminists control.) School children are being prepared for the religion of the New World Order.

Illuminists have gained control of public schools and have turned them into agents for social change—thus, fulfilling the longtime goal of Freemasonry of capturing public education and using it to promote the anti-Christ religion and socialistic politics of Freemasonry. (All that now remains to bring education completely under the control of the Illuminists is eliminating Christian and Catholic schools and outlawing home schooling.) They are using their control to prepare students for the illuministic New World Order. School children are being prepared for a world of moral relativism without Christianity. They are being taught to accept supranational regional governance and then a world government. They are being taught to hate the Aryan race and to glorify all other races. They are being taught that homosexual sex and miscegenation are not only normal, but are superior sexual relations. With easy access to abortion, they are being taught to devalue life. Euthanasia is also promoted. A school curriculum promoting pantheistic religion and world government has replaced traditional Western curricula, which promoted Christianity, nationalism, and ethics. A primary function of public schools is to turn children into good “global citizens.” Teachers are to concentrate on the social orientation of students instead of educating them. Children should be unable to read and especially unable to think or analyze. GOALS 2000 and the “no child left behind” program are part of the New World Order’s educational program.

The Illuminists have implemented the educational program that Woodrow Wilson outlined in 1909. Wilson described the illuministic educational program as follows:

. . . We want to do two things in modern society. We want one class of persons to have a liberal education, and we want another class of persons, a very much larger class, of necessity, in every society, to forego the privileges of a liberal education and fit themselves to perform specific difficult manual tasks. You cannot train them for both in the time the you have at your disposal. They must make a selection, and you must make a selection.[5]

True to its fascist principles, the illuministic state strips parents of authority over their children, yet it holds parents responsible for their children. Illuminist controlled government usurps parental authority, yet it holds parents accountable.

Secular humanism has replaced Christianity as the state religion. It is the religion upon which state institutions and laws are built. Man is worshiped instead of God.

Endnotes
1. Billy James Hargis, Communist America Must It Be? (Tulsa, Oklahoma: Christian Crusade, 1960), p. 66.

2. Gary H. Kah, En Route to Global Occupation (Lafayette, Louisiana: Huntington House Publishers, 1992), p. 61.

3. James W. Wardner, Unholy Alliances: The Secret Plan and the Secret People Who Are Working to Destroy America (James W. Wardner, 1996), p. 221.

4. Ibid., p. 221.

5. Dennis L. Cuddy, The Globalists: The Power Elite Exposed (Oklahoma City, Oklahoma: Hearthstone Publishing, 2001), p. 28.

[Editor’s note: References in original are omitted.]

Copyright © 2010 by Thomas Coley Allen.

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Foundations

Foundations
Thomas Allen

[Editor’s note: Footnotes in the original are omitted.]

During the last half of the nineteenth century, the United States saw its wealthiest men becoming Illuminists and funding and otherwise supporting Illuminism. They included Andrew Carnegie, John D. (“competition is a sin”) Rockefeller, and J. P. Morgan. One of the greatest instruments in advancing Illuminism was the establishment of foundations, which funded illuministic causes in the twentieth century.

The major American foundations are the creation of Daniel Gilman, a German Illuminist and a member of Skull and Bones. In 1898, Gilman created the General Education Board by merging the Peabody Education Fund and the John F. Slater Fund. Gilman had been vice president of both funds. Later in 1902, the General Education Board became part of the Rockefeller’s Southern Education Board, which retained the name of General Education Board.

In 1907, he set up the Russell Sage Foundation. Assisting Gilmore in setting up the Russell Sage Foundation were Cleveland H. Dodge, a director of National City Bank, and Moses Pyne, grandson of the founder of National City Bank.

The first large scale foundation began with the wealth of George Peabody. Peabody left the slave trading business and moved to England. With the aid of Brown Brothers and Nathan Mayer Rothschild, Peabody established his banking house, George Peabody and Co., in England in 1835. Peabody made a fortune buying depressed notes during the Panic of 1837. He had become, by 1861, the largest trader of American securities in the world.

In 1865, Peabody founded the Peabody Education Fund, which worked closely with the occupying military forces in the South during Reconstruction. Ostensibly, the Peabody Education Fund was established to educate freed slaves following the War for Southern Independence. In reality it aided carpetbaggers to gain control of the South. They used their control of the governments of the Southern States to improvise them by saddling them with huge loans from Northern bankers. The Peabody Education Fund later became the General Education Board.

Junius S. Morgan, as the head of Beebe, Morgan and Co. of Boston, became Peabody’s agent in America. In 1854, Morgan became Peabody’s partner to form Peabody, Morgan and Co. Through this connection, Morgan and later his son, John Pierpont (J.P.) Morgan, Sr. collaborated closely with the Rothschild—so closely that Morgan was considered an agent of the Rothschild. With the retirement of Peabody in 1864, Junius Morgan and J.P. Morgan gained control of Peabody, Morgan and Co. and changed the name to Morgan and Co. Morgan and Co. became one of the most powerful banking houses in the world.

In 1864, Junius Morgan persuaded Charles H. Dabney to join with J.P. Morgan, Sr. to form Dabney, Morgan and Co., which was the agent of Morgan and Co. in the United States. In 1871, Anthony Drexel became a partner and the company changed its name to Drexel Morgan Co. When Drexel died in 1895, Morgan changed its name to J.P. Morgan and Co. This company soon became the principal source of funds for the United State government. With Rothschild’s gold, Morgan rescued the United States government following the Panic of 1893.

In the United States, J.P. Morgan, Sr. provided banking services for those who preferred not to do business with Jewish bankers. Kuhn, Loeb and Co., another banking firm allied closely with the Rothschilds, provided services for those who wanted to deal with a Jewish bank.

John D. Rockefeller followed Peabody’s example and established the Southern Educational Board. It was established to promote education without regard to race, creed, or sex—that is, it was established to promote racial amalgamation and the elimination of distinction between the sexes. It also promoted globalism and socialism in the public school system.

Andrew Carnegie, a spiritualist, built his fortune on looting the public treasury. To overcome objections to his fortune and how he got it, he, like many other wealthy Illuminists, built a reputation as a humanitarian philanthropist. Besides donating money to churches and public libraries, he established the Carnegie Institute (David Gilman set up the Carnegie Institute in 1902 and became its first president) and the Carnegie Hero Fund Commission. Having made a fortune from wars, Carnegie donated large sums to organizations that advocated consolidation of governmental powers into regional, supranational, and international bodies. As an opponent of nationalism, he supported establishing a League of Nations.

Carnegie was a fascist socialist at heart. He was an advocate of a strong central government. Government must control private business. He supported implementation of the planks of the Communist Manifesto, such as a central banking system and heavily progressively graduated income taxes (after he had protected his own fortune in foundations and trusts). He bought 18 newspapers in Great Britain to spread his radical ideas on abolishing the monarchy and the House of Lords, dismantling the British Empire, and disestablishing the Church of England. He supported a union of Great Britain, Canada, and the United States. Carnegie was drunk with Illuminism.

Theodore Marburg was another wealthy man who wanted to establish a world government. His scheme was to use Carnegie’s wealth, international financiers, and Fabian Socialists to form a League of Nations to enforce peace with an international “peace army.” Controlling this world government would be the international financiers.

The tax exempt foundations, like the Rockefeller Foundation, provided the financing that the Illuminists needed to gain control of education, religion, and government.

Much of the funding for the advancement of Illuminism during the twentieth century has come from the tax-exempt foundations. The major foundations are the Carnegie Corp., Carnegie Endowment for International Peace, Rockefeller Foundation, and Ford Foundation. Many less well known foundations, such as, the Alfred P. Sloan Foundation, Carnegie Foundation for the Advancement of Teaching, Carnegie Institute of Washington, Commonwealth Fund of New York, Fund for the Republic, Markle Foundation (a major source of funding for the Aspen Institute ), Rockefeller Brothers Fund, Samuel Rubin Foundation (a major source of funding for the Institute for Policy Studies), Starr Foundation, and Twentieth Century Fund, have also supported Illuminism. These tax-exempt foundations have also been a major source of funds for Communists and Communist sympathizers and their organizations. Illuminists controlled all these foundations. The goal of these foundations is to alter the life of the American people so that they will accept Illuminism and its New World Order with its one world government and one world religion.

The major foundations have specialized in supporting different aspects of Illuminism. The Ford Foundation specializes in altering the United States so that they “can be comfortably merged with the Soviet Union.”[1] The Carnegie Endowment specializes in controlling the foreign policy of the United States and using war to alter the life style of the American people. The Rockefeller Foundation and Guggenheim Foundation specialize in controlling education. While the Carnegie Endowment deals with international issues, the Rockefeller Foundation deals with domestic issues.

The foundations gained control of higher education by making colleges and universities dependent on them for research funds. They control “practically all social science research and such research is used to promote collectivism and world government.”[2] Grants from the United States government do not lessen this control because Illuminists also control the United States government and the Department of Education.

Along with other foundations, the Carnegie Endowment uses its wealth and power to maneuver the American people into war. War is the most effective way to persuade people to enslave and impoverish themselves. People are not inclined to question the acts of government, i.e., the acts of people who really control the government, during war. The longer the war, the more inclined people are to accept the changes as permanent—thus, Bush’s never-ending War on Terrorism.

On the power of tax-exempt foundations, Congressman B. Carroll Reece remarked in 1954:

It has been said that the foundations are a power second only to that of the Federal Government itself. Perhaps this statement should be modified because it seems to have become an affront for a congressional committee to dare to subject the foundations to criticism. Perhaps the Congress should now admit that the foundations have become more powerful, in some areas, at least, than the legislative branch of Government.[3]

These foundations are more powerful now than when he made this remark.

Endnotes
1. Archibald E. Roberts, Emerging Struggle for State Sovereignty (Fort Collins, Colorado: Betsy Ross Press, 1979), p. 114.

2. Ibid., p. 127.

3. Ibid., p. 125.

References
Cuddy, Dennis L. The Globalists: The Power Elite Exposed.Oklahoma City, Oklahoma: Hearthstone Publishing, 2001.

Cuddy, Dennis L. Now Is the Dawning of the New Age New World Order. Oklahoma City, Oklahoma: Hearthstone Publishing, 2000.

Hoar, William P. Architect of Conspiracy: An Intriguing History. Belmont, Massachusetts: Western Islands, 1984.

Kah, Gary H. En Route to Global Occupation. Lafayette, Louisiana: Huntington House Publishers, 1992.

Marrs, Jim. Rule by Secrecy: The Hidden History That Connects the Trilateral Commission, the Freemasons, and the Great Pyramids. New York, New York: Harper Collins Publishers, 2000.

Monteith, Stanley. Brotherhood of Darkness. Oklahoma City, Oklahoma: Hearthstone, 2000.

Mullins, Eustace. The Curse of Canaan: A Demonology of History. Staunton, Virginia: Revelation Book, 1987.

Mullins, Eustace. Secrets of the Federal Reserve. 1991.

Mullins, Eustace. The World Order: Our Secret Rulers. Second edition. Staunton, Virginia: Ezra Pound Institute of Civilization, 1992.

Roberts, Archibald E. Emerging Struggle for State Sovereignty. Fort Collins, Colorado: Betsy Ross Press, 1979.

Roberts, Archibald E. The Most Secret Science. Fort Collins, Colorado: Betsy Ross Press, 1984.

Skousen, W. Cleon. The Naked Capitalist: A Review and Commentary on Dr. Carroll Quigley’s Book Tragedy and Hope. Salt Lake City, Utah, 1971.

Smoot, Dan. The Invisible Government. Dallas, Texas: The Dan Smoot Report, Inc., 1962.

Still, William T. New World Order: The Ancient Plan of Secret Societies. Lafayette, Louisiana: Huntington House Publishers, 1990.

Stormer, John A. None Dare Call It Treason. Florissant, Missouri: Liberty Bell Press, 1964.

Wardner, James W. Unholy Alliances: The Secret Plan and the Secret People Who Are Working to Destroy America. James W. Wardner, 1996.

Copyright © 2010 by Thomas Coley Allen.

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OSS and CIA

Office of Strategic Services and Central Intelligence Agency
Thomas Allen

[Editor’s note: Footnotes in the original are omitted.]

To collect and analyze intelligence for Illuminists and to organize and execute covert operations for Illuminists, Roosevelt created in 1942 the Office of Strategic Services (OSS) and appointed William J. Donovan as its head.

In 1915, the Rockefeller Foundation had sent Donovan to Europe on a war relief mission. J. P. Morgan, Jr. sent him to Europe in 1920 to obtain intelligence related to the issuance of bonds that Morgan’s Foreign Commercial Corp. was planning to float. During Hitler’s rise to power, Donovan had established a network of informants in the German government. Roosevelt selected Donovan to head the OSS because for two decades he had been carrying “out secret missions for the Morgans, Rockefellers, and Rothschilds.”[1] Before setting up the OSS, Roosevelt sent Donovan to the Tavistock Institute in London where British intelligence indoctrinated him. (To this day the Central Intelligence Agency uses the techniques of mind control taught at the Tavistock Institute.)[2]

British intelligence organized the OSS. Thus, the OSS was merely a front for British intelligence. Four members of the British Chief of Staff set up the OSS. They were Lord Louis Mountbatten, who was related to the King of England and the banking families of Rothschild and Cassel; Charles Hambro, director of Special Operations Executive and director of Hambros bank; Colonel Stewart Menzies, head of the British Secret Intelligence Service; and William Stephenson, head of the Special Intelligence Section (SIS).

With aid from the Rockefellers, Stephenson and the SIS operated the British espionage network in the United States. Stephenson’s task was to provoke war between the United States and Germany. Donovan provided special passports for Stephenson’s agents and otherwise assisted him.[3]

Many people that Donovan employed in the OSS were Communists, many of whom were veterans of the Abraham Lincoln Brigade. He knew that they were Communists and employed them because they were Communists.

In 1943, Donovan went to Moscow to establish a permanent alliance between the OSS and the NKVD. Assisting Donovan in this endeavor was W. Averell Harriman. The alliance was to allow the NKVD to have offices in various American cities and to exchange officers with the OSS. Fearing bad publicity in his upcoming election, Roosevelt withdrew his support for the alliance.

Truman abolished the OSS in 1945. The Central Intelligence Agency (CIA) was established in 1948 and assumed the intelligence work of the OSS. Allen Dulles of J. Schroder Banking Corp., William H. Jackson, a Wall Street lawyer, and Mathias F. Correa, a Wall Street lawyer supervised the organization of the CIA. Dulles became the first director of the CIA. The law establishing the CIA gave it immunity for all civil and criminal laws.

One of the first tasks of the CIA was to scare Americans and Europeans with propaganda about the might of the Soviet Union. (As it turned out, the Soviet Union’s threat was a chimera.) In Europe, the objective of this propaganda was to scare Europeans away from neutrality. In America, it was used to fund the military-industrial complex, most of which Illuminists owned, and to scare the American people to surrender liberty for security by allowing nearly unchecked growth in the U.S. government, which the Illuminists controlled. To carry out this program, the CIA funded media organizations and hired journalists, editors, and others connected with the news media. Many major news outlets became willing co-conspirators with the CIA—after all, the Illuminists controlled them—to dispense its propaganda and disinformation.

One of the most influential magazines on the right was National Review founded by (former?) CIA agent William Buckley. Also involved in the founding of National Review was James Burnham and Wilmoore Kendall, both of whom were CIA agents. William Casey, who was involved with the OSS and who later became director of the CIA, drew up the legal documents for the magazine.

The CIA continued Donovan’s policy of hiring Communists. Soviet KGB defectors have claimed that the CIA has Soviet spies within it. Members of Skull and Bones have essentially controlled the CIA from its founding. Since its establishment, the CIA has never undergone an outside investigation. One was attempted in the 1950s, but Vice-President Nixon squashed it.

The CIA collects and analyzes intelligence not only for the United States government, but also for Establishment Insiders. With bribes and coercion, it influences foreign elections for the advancement of the New World Order. As Truman remarked, it even makes its own wars.

Some of the people who have studied the assassination of President John Kennedy are convinced that the CIA was behind it. Kennedy may have been assassinated because he was planning to withdraw from the Vietnam War, which the Illuminists wanted escalated. He also wanted to reduce the U.S. government’s reliance on and the importance of the Federal Reserve System by having the U.S. government issuing notes directly instead of indirectly through the Federal Reserve System—an action apparently disapproved by the bankers. Another action taken by Kennedy that led to his assassination was that he fired Dulles and wanted to weaken the power of the CIA. Additionally. He opposed Israel’s development of nuclear weapons. Among the people believed to have been involved in the assassination were James Angleton (the CIA’s liaison with the Israeli Mossad), George H. Bush, Allen Dulles, J. Edgar Hoover, Vice-President Lyndon Johnson, and Nelson Rockefeller.[4]

Endnotes
1. Eustace Mullins, The World Order: Our Secret Rulers, (Second edition; Staunton, Virginia: Ezra Pound Institute of Civilization, 1992), p. 143.

2. Ibid., p. 140.

3. Ibid., p. 139.

4. Chris Millegan, “The Order of Skull and Bones,” http://www.bilderberg.org/skulbone.htm, Apr. 28, 2003.

References
Cuddy, Dennis L. The Globalists: The Power Elite Exposed. Oklahoma City, Oklahoma: Hearthstone Publishing, 2001.

Mullins, Eustace. The World Order: Our Secret Rulers. Second edition. Staunton, Virginia: Ezra Pound Institute of Civilization, 1992.

Still, William T. New World Order: The Ancient Plan of Secret Societies. Lafayette, Louisiana: Huntington House Publishers, 1990.

Wardner, James W. Unholy Alliances: The Secret Plan and the Secret People Who Are Working to Destroy America. James W. Wardner, 1996.

Copyright © 2010 by Thomas Coley Allen.

 More articles on history.