Freemasonry the Early Years

Freemasonry the Early Years
Thomas Allen

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

Interest by non-masons in Freemasonry began to grow in the seventeenth century. Freemasonry began to divide into two kinds: operative and speculative. Scottish Masonic lodges began to allow honorary members, who were not stonemasons. These Scottish Masons brought about the restoration of the House of Stuart in 1660. The beginnings of modern Freemasonry started about 1619 when the London Masons’ Company organized a body called the "Acception." This organization was established for men who were not masons by trade; they were known as "gentleman masons" or "accepted masons."

Freemasonry became so popular and fashionable in Great Britain during the seventeenth century that the "accepted" Masons became the majority. Finally, those who were not operative masons, masons by trade, decided to abandon the operative masonic lodges and form their own gentlemen’s lodges. Thus, Freemasonry was born.

An important figure behind the creation of speculative Freemasonry was Francis Bacon, a Rosicrucian and possibly a son of Queen Elizabeth I.[1] He was highly involved in the tradition of the Knights Templars.[2] Furthermore, Bacon is one of Illuminism’s most important leaders. In his New Atlantis, Instauratio Magna, and some of his other works, he laid out the plan for the New World Order.

Modern-day secret societies and their concomitant conspiracies and occultism may be said to begin in the early eighteenth century with the establishment of modern-day Freemasonry. Modern-day Freemasonry began in 1717 with the union of four London lodges to form the United Grand Lodge of British Freemasons (the Grand Lodge of London).[3] The seven founders were James Anderson (a minister of the Presbyterian Church of Scotland and a libertine), Calvert, Theophile Desaguliers, Joseph Elliott, James King, Lumen-Madden, and George Payne.[4] All seven were Gnostics and Magi of the English Rose Croix. Anthony Sayer became the first Grand Master. In 1721, John, the Duke of Montagu, became the GrandMaster; since then, the Grand Master has always been a nobleman. Philip, Duke of Wharton, a prominent Whig politician became Grand Master in 1722. The first person of the royal family to be Grand Master was Henry Frederick, Duke of Cumberland, brother of George III, in 1782. Since 1782, the Prince of Wales, the Duke of Cumberland, the Duke of York, or the Duke of Sussex has been grand master. Traditionally, a member of the royal family, or someone with close ties to Buckingham Palace, has been Grand Master of the English lodges.

By 1732, the Grand Lodge of London had become the center of English Freemasonry. By 1747, it dominated Freemasonry throughout the world.

The Freemasons modeled the structure of their organization after the craft guilds of the Middle Ages, primarily the French Compagnons and the Vehmgerichts, with degrees of membership. To this structure was added a speculative philosophy acquired from the Cabala. Among the other ancestors of Freemasonry are the ancient Mysteries of Egypt and Greece, Pharisaic Judaism, the Essences of Jerusalem, Hinduism, Gnosticism, the Roman Collegia of Artificers (Roman College of Builders), the Templars, the Steinmetzen of Westphalia, Rosicrucianism, and Theosophy. Of these, Jewish ones predominate and are, by far, the most important.

Fahey describes the relationship between Jews and Freemasonry as follows:

What we see, then, in the years following 1717 is rather the emergence into fuller light of a secret organised Force aiming at enrolling and forming groups of adepts to work for Naturalism, that is, for the denial of the Supernatural Life and the elimination of membership of Christ from society. The Jewish nation is a non-secret organised naturalistic Force, that is to say its naturalistic opposition to the Mystical Body of Christ is openly proclaimed. Freemasonry, the organised naturalistic Force action in subordination to and in conjunction with the Jewish nation is a secret society or group of societies, for its naturalism or anti-supernaturalism is secret or camouflaged.[5]

Of the relationship between modern Judaism and Freemasonry, Cahill observed,

(1) That much of the external trappings of Freemasonry, such as its ritual, its terminology, its legends, etc. are of Jewish origin;

(2) that the philosophy or religion of esoteric Freemasonry (that is of the inner circles and controlling power) is practically identical with the doctrines of the Jewish Cabala, which is the religion or philosophy of a certain section of the Jews;

(3) that a certain group of Jews, probably very few in number, but of immense influence and power, are leading Freemasons; and

(4) that a somewhat larger group of very influential Jews pursue the same ends as Freemasons, and use similar means, and are at least in close alliance with them.[6]

According to James Anderson, the real aim of Freemasonry was to carry "pure Gnosticism and liberal rationalism throughout the entire world"[7] and that "the secret teachings of the supreme leaders of Freemasonry may be summed up in these words: to establish all the rights of Man."[8] (Masonic Gnosticism goes back at least 200 years before the union of the London lodges.)

Freemasonry soon spread across Europe. In 1721, speculative English Freemasonry first appeared on the Continent in France. In 1725, English nobles and gentry who were supporters of James II, the Jacobites, founded the Grand Lodge of Paris. Charles Radcliffe, Earl of Derwentwater was its first Grand Master. (Thus, while Illuminists through Freemasonry in England supported the house of Hanover, Illuminists through Freemasonry in France and Scotland supported the house of Stuart.)

After arriving in France, Freemasonry spread rapidly across the continent. It appeared in Spain in 1728, Holland in 1730, Germany in 1730, Russia in 1731, Italy in 1733, Poland in 1735, Portugal in 1735, Sweden in 1735, Switzerland in 1736, Austria in 1742, Hungary in 1742, Denmark in 1743, and Finland in 1756. Monarchs in Spain, Portugal, and Naples opposed Freemasonry. However, in Germany and Austria, the monarchs viewed it favorably.

Freemasonry soon received the opposition of King Louis XV, who forbad his subjects to become Freemasons. Opposition to Freemasonry in France seemed to have been directed against selected individuals rather than Freemasonry per se. Two anti-masonry movements occurred in France: one in 1737 and the other in 1744 and 1745. However, persecution was sporadic and ineffective. Cardinal Andre de Fleury, who lead the first anti-Masonry movement, did not submit the Papal Bull issued in 1738 condemning Freemasonry to the French Parliament. Opposition to Freemasonry was mostly from the Catholic Church; the government showed little concern. Much of it may have been Cardinal Fleury’s attempt to protect himself from a high-ranking aristocrat using Freemasonry against him.

Frederick the Great aided the introduction of Freemasonry into Germany. In 1738, he was initiated into Freemasonry. He became Grand Master, and in 1761, he headed the Scottish Rite. Other rulers of German states followed his lead, as did Francis I of Austria. Frederick used Freemasonry as a cover for his intrigues.

Schisms soon developed within Freemasonry. In Great Britain, Freemasonry divided between the United Grand Lodge of England, which followed the new rules and ceremonies of The Constitutions of the Freemasons that Dr. James Anderson had written, and the Grand Lodges of Scotland and of Ireland, which preferred the old constitutions. Adherents of the new rules and ceremonies were known as the Modernists, and the adherents of the old, as the Antients or Ancient Masons. The Antients supported four Masonic degrees while the Moderns supported only three. Furthermore, while the Moderns had fully de-Christianized Freemasonry, the Antients had not. (Freemasonry did not seek to destroy the established religion so much as to replace it with the religion of Freemasonry.) Furthermore, the new constitutions replaced loyalty to country and patriotism with loyalty to the brotherhood of Freemasons, cosmopolitanism, internationalism, and nebulous mankind. (Freemasonry placed itself above state and country; for practical reasons, it avoided open conflict with the state.) This division remained until 1813 when the rival Grand Masters, George IV’s brothers, Edward Augusta, Duke of Kent and Grand Master of the Antients, and Augusta Frederick, Duke of Sussex and Grand Master of the Moderns, reunited the two factions. The union resulted in the United Grand Lodge of England with the Duke of Sussex as the Grand Master. The Moderns won in de-Christianizing Freemasonry, and the Antients won in having higher degrees and the invocation of the supposedly rediscovered long-lost name of God associated with the higher degrees.

In France a split occurred between followers of the Jacobites, who favored higher degrees (the Scottish Rite), and followers of the Grand Lodge of France (the English Grand Lodge of France), who opposed higher degrees. Masonic lodges that followed the Scottish Rites were known as red masonic lodges. Lodges following the English were known as blue masonic lodges. In 1754, Louis, Prince of Bourbon, Count of Clermont, and Grand Master of the Grand Lodge of France, began adding higher degrees. (Louis was Grand Master from 1743 until 1771.) In 1756, the Grand Lodge of France declared itself independent of the Grand Lodge of England.

At the urging of Mirabeau, Philippe Egalite, Duke of Chartres, later Duke of Orleans, united the various factions of French Freemasonry in 1773 with himself as Grand Master. Thus, to bring greater coordination and discipline among the red lodges, the Grand Orient of France was founded. Essentially, the union resulted in the Grand Lodge being submerged into the Grand Orient with the masters of the Grand Orient being masters of the new organization. The union was one of force as mush as of mutual agreement. (Even after this union, schisms continued until 1799.)

The Duke of Orleans led the faction that sought to overthrow Louis XVI, his brother-in-law, and put himself on the throne. He used the Grand Orient, which was no social club, to fulfill his ambition. It was in the forefront of revolutionary incitement. As early as 1776, it leadership was instructing the membership in preparation for insurrection.

In Germany a power struggle occurred between the Rosicrucian element and the French element. (French prisoners of war introduced the French element in 1756 and 1757.) Disagreement involved craft practices. The Rosicrucians had adopted the Scottish Rites, which had degrees above the first three. An appeal was made to the Grand Lodge of London, which claimed that to guarantee the purity of Freemasonry, it must instruct and rule on all matters of Freemasonry. It ruled that only three degrees were authentic. German Freemasonry divided into two factions: the Rosaic (Rosicrucian) lodges and lodges adhering to the Grand Lodge of London.

While these two factions squabbled, another Masonic faction rose to become much more important than these two. This was the Order of Strict Observance, which was founded in 1751. Karl Gotthold, Baron von Hund, organized this Order, which was based on the Scottish Rite and the Order of the Gold and Rosy Cross (a Rosicrucian society), and which was a Templar order.[9] Among the members of this Order were Prince Charles (Karl) of Hesse, Duke Ferdinand of Brunswick (who became the head of the Order), von Bischoffswerder (the Prussian minister), Christian Bode (the Councillor of Legation in Saxe-Gotha and later a member of the Bavarian Illuminati.), Baron de Wachter, von Haugwitz (foreign minister of Frederick the Great), Baron Adolph von Knigge (Weishaupt’s assistant), Marquis de Chefdebien d’Armisson, and Count Leopold de Kollowrath-Krakowski.[10] Behind this Order were the Unknown Superiors, who remained in the background yet who had supreme control of the Order. Frederick the Great, Voltaire, and Hayyim Samuel Falk were probably among the Unknown Superiors.[11] The Order of Strict Observance eventually gained control of German Freemasonry. Then it was absorbed into the Order of the Illuminati as a result of the Congress of Wilhelmsbad in 1782. Officially, the Order of Strict Observance disappeared after the Congress of Wilhelmsbad. Nevertheless, it seems to have merely changed its name and became the Rectified Scottish Rite.

The Order of Strict Observance spread to France, Sweden, Hungary, Italy, and Russia. The Duke of Sudermania, who later became King Charles XIII of Sweden, presided over the Order in Sweden. In France, Jean-Baptiste Willermoz set up the first lodge in 1774 in Lyon, the year that he joined the Order. However, in 1778, Willermoz made French members of the Strict Observance independent of the Germans.

Besides Freemasonry, other secret societies also played an important role in the development of Illuminism during the eighteenth century. One such society was the Martinists or French Illuminati.

In 1754, Martines de Pasqually (Martinez Paschalis or Pasqualis), a Jew of Portugese origin, who was supposedly a Catholic by faith, founded the Order of the Elected Priest, whose members became known as Martinists and as French Illumines. Pasqually was a Rose Croix Freemason and a Rosicrucian. His Order was centered in Lyon, but it spread as far as Russia. This Order was an important instrument in spreading occultism across France. It emphasized theurgy, the Cabala, magic, divination, alchemy, Gnosticism, and Theosophy. Its goal was to use hedonism, secrecy, terror, and revolution to destroy Christianity and the existing order. From this anarchy would arise a New World Order without God where the Illuminists would hold the sexes and goods in common and mankind would be reduced to a herd of animals. Like all Illuminists, the Martinists had an intense hatred of the God of the Christians—thus, their rampant immorality, which is merely open rebellion against Him. It eventually became the third great Masonic power in France. Its philosophy became the predominant philosophy of Freemasonry.

In 1771, the Martinists and several other rival Masonic orders united and formed the new lodge of the United Friends. Savalette de Lange, a high initiate in Freemasonry and "the man of all conspiracies,"[12] founded this lodge. When he founded it, he was the Royal Treasurer, Grand Officer of the Grand Orient. To unite the other lodges into his, he blended sophistic, Martinist, and Masonic systems. Among the members of the United Friends were Jacques Pierre Brissot de Warville, Marquis de Chefdebien d’Armisson (he was also a member of the Grand Orient and the Strict Observance), Condorcet (Freemason), Danton, Frederic-Louis de Hesse-Darmstadt Count de Gebelin, Baron de Gleichen (Freemason), William Law (English clergyman), Mirabeau, Louis Claude Saint-Martin, Emmanuel J. Sieyes (Freemason), Viscount of Tavannes, Willermoz, and William IX of Hesse.[13] The United Friends "prosecuted the dark and dangerous work of preparing that reformation of society which in practice became [the French] Revolution."[14]

At the time of the union, Willermoz, who had joined the Martinists in 1767, controlled the Martinist lodges. He remained at Lodge Theodore in Munich until 1784, two years after Weishaupt’s Illuminati formerly united with Freemasonry. Lodge Theodore was the center of the Illuminati.

Endnotes
1. William T. Still, New World Order: The Ancient Plan of Secret Societies (Lafayette, Louisiana: Huntington House Publishers, 1990), p. 47.

2. 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. 228.
3. Norman MacKenzie, ed., Secret Societies (New York, New York: Holt, Rinehart and Winston, 1967), p. 163. K.R, McKilliam, Conspiracy to Destroy the Christian West (London, England: The Board of Anglo-Saxon Celtic Deputies). p. 5.
4. Queenborough, Lady (Edith Starr Miller), Occult Theocracy (Two Volumes. Hawthorne, California: The Christian Book Club of America, 1933), pp. 34, 175. J. S. M. Ward, Freemasonry and the Ancient Gods (London, England: Simpkin, Marshall, Hamilton, Kent & Co. Ltd., 1921), p. 68.
5. Denis Fahey, Grand Orient: Freemasonry Unmasked as the Secret Power behind Communism through Discovery of Lost Lectures Delivered by Monsignor George F. Dillon, D.D. at Edinburgh, in October 1884 (New and Revised Edition. Metairie, Louisiana: Sons of Liberty, 1950), p. xiii.
6. E. Cahill, Freemasonry and the Anti-Christian Movement (Second edition. Dublin, Ireland: M.H. Gill and Son, Ltd., 1930. Reprinted 1952), p. 77.
7. James W. Wardner, Unholy Alliances: The Secret Plan and the Secret People Who Are Working to Destroy America (James W. Wardner, 1996), p. 81.
8. Ibid., p. 82.
9. Marrs pp. 240, 246-247. Queenborough, p. 350. J.M. Roberts, The Mythology of the Secret Society (New York, New York: Charles Scribner’s Sons, 1971), pp. 106-107. Nesta H. Webster, Secret Societies and Subversive Movements (Palmdale, California: Omni Publication, 1924), p. 154.
10. Clarence Kelly, Conspiracy Against God and Man: A Study of the Beginnings and Early History of the Great Conspiracy (Belmont, Massachusetts: Western Islands, 1974), p. 72. Webster, pp. 154, 210, 236.
11. Kelly, p. 72. Webster, pp. 157,190.
12. Una Birch, Secret Societies and the French Revolution Together with Some Kindred Studies (New York, New York.: John Lane Co., 1911), p. 31.
13. The Cause of World Unrest (New York, New York: G. P. Putnam’s Sons, 1920), p. 23. Queenborough, pp. 183, 369. Webster, p. 171.
14. Birch, p. 31.
[Editor's note: The original contains a list of references, which has been omitted.]
Copyright © by Thomas Coley Allen.

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French Revolution Part III

The French Revolution
Part III: The Aftermath

Thomas Allen

[Editor's note: The footnotes in the original are omitted.]

Napoleon began his career as a Freemason. The commencement of his rise, he owed to the Jacobins. Robespierre was his earliest promoter. During his Italian campaign, he treated the Church with the animus and brutality of a high-degree Masonic Illuminists. His reign was a continuation of the French Revolution.

Napoleon owed his power to Talleyrand, a Freemason Illuminists. A backlash was beginning to occur that would lead to placing the Bourbons back on the throne. To prevent the return of the Bourbons, the Illuminists vested supreme power in the hands of Napoleon. Furthermore, giving him supreme power would aid them in their goal of unifying Europe under their rule. He filled his high offices of state with Freemasons and other Illuminists.

Napoleon’s rise to power further enriched Mayer Amschel Rothschild. Rothschild acquired wealth from the armament and other industries supporting Napoleon’s army. Knowing the movements of Napoleon in advance, he gained a fortune from land and security speculation. This wealth he used to establish banks for his sons, Amschel Mayer, Salomon, Nathan Mayer, Karl and James (Jacob), in the capitals of Europe. Not only did Rothschild finance Napoleon during the Napoleonic Wars, but he also financed the British. Thus, he controlled both sides of the wars.

One of Napoleon’s mistake was his encouragement of Freemasonry. (To maintain control over Freemasonry in France, he had his brothers, Joseph Bonaparte and then Lucien Bonaparte, made Grand Master. Jean Cambaceres, second consul under Napoleon, directed the Grand Orient.) As long as he served the conspiracy of the Illuminists, they served him. (Evidence that he served them well until the latter years of his reign is the lack of well-organized attempts to overthrow him and the lack of opposition that he received from established secret societies, such as Freemasonry.) The conspiracies and treason of Illuminists in other countries probably gave Napoleon more victories than the French army. Eventually, Napoleon entered into an alliance with the imperial family of Austria and procreated an heir to his throne, thus threatening the illuministic universal republic. With the Concordat of 1801, he made peace with the Catholic Church. As he became more monarchal, he began allying himself with the nobility. He even refused to borrow money from the Rothschilds; instead he established his own bank, the Bank of France, to finance his government. Worse, he began to turn against the Illuminists and Freemasonry and thwart their conspiracy. Napoleon became too powerful for the Illuminists. So, Jean Baptiste Jule Bernadotte, a Freemason, convinced him to invade Russia. The invasion of Russia destroyed the French army and ultimately brought down Napoleon.

Aiding in the overthrow of Napoleon was the Chevaliers de la Foi. Ferdinand de Bertier was the founder of the Chevaliers. Following his arrest, Bertier became a Freemason. Then he founded the Chevaliers de la Foi, which he structured after Freemasonry with grades, secrecy, and deception. The Chevaliers was ostensibly a charitable organization. However, its real purpose was political, the overthrow of Napoleon. The Chevaliers became an important intelligence agency for the invading allied army. They supported restoration of the Bourbons. (Talleyrand worked with the Chevaliers.)

Another secret society working to overthrow Napoleon was the Philadelphic Society. It was founded about 1798 as a reading and debating society without any political objective. Later it turned into a royalist anti-Bonapartist secret society. The Society had about 60 members.

General Claude Malet, a Freemason, conceived of turning it into an anti-Bonapartist secret society to restore the Bourbons to the throne. He chose his friend Lt. Colonel Oudet, a Freemason, to reorganize it. Oudet reorganized the Philadelphic Society with an oath of secrecy and fidelity, three classes of members, with each class being ignorant of the functions of the higher class, and with an air of mystery while presenting it as an association to promote moral perfection and the perfection of humanity and society. Oudet became the head of the reorganized society with absolute authority over it. Next he organized a front society, the Society of the Freres Bleus, in which soldiers were recruited without distinction of rank. He also organized front groups for peasants. The Philadelphia Society later changed its name to the Olympians.

Beginning in 1800, the Philadelphians through their front organizations were behind several attempts to overthrow Napoleon. These early conspiracies led to the imprisonment of Malet and Oudet’s loss of rank, position, and leadership of the Philadelphic Society for a while. In 1809, Oudet was killed in an ambush that Napoleon probably ordered.

In 1812, while Napoleon was in Russia, Malet organized a conspiracy to overthrow Napoleon. Collaborating with him in this conspiracy were Jean Moreau, Talleyrand, Trochot, Fouche, Count Alexis of Noailles, and Count of Montmorency. Although Malet’s coup failed, and he was executed, the following year the Senate carried out the program of the Olympians (Philadelphians) and deposed Napoleon. Talleyrand became the president of the provisional government that replaced Napoleon.

After his defeat, Napoleon remained too dangerous for the Illuminists to allow to live. An agent of the Rothschilds poisoned him during his imprisonment on St. Helena. The Illuminists also had his son, the Duke of Reichstadt, murdered.

By the end of the Napoleonic Wars, the Rothschilds were so powerful that they practically dictated the treaty that came out of the Congress of Vienna in 1815. The result of the Congress of Vienna was placing the continent of Europe under the Rothschilds. To protect their investments, the Rothschilds instituted the principle of the "balance of power," i.e., playing various countries against each other.

With the wealth that he had acquired from the French Revolution and Napoleonic Wars and through his sons, Mayer Amschel Rothschild established the greatest banking empire in Europe. By the 1820s the Rothschilds had become the dominant banking family in Europe. Amschel Mayer Rothschild succeeded his father at the Frankfurt branch in 1812, which closed in 1901. Salomon Rothschild, a Freemason, established the Vienna branch, which closed when Germany occupied Austria in 1938. Nathan Meyer Rothschild, a Freemason, established the London branch, N.M. Rothschild and Sons, in 1804. Karl Rothschild established the Naples branch, which closed in 1860. James Rothschild established the Paris branch, Rothschild Freres. The Rothschilds rose to power by getting the governments of Europe indebted to them.

Following the Congress of Vienna, the Illuminists set about preparing their next convulsion. Once again Freemasonry would be called upon to be in the forefront of the subversion and revolution. The revolutions of the remainder of the nineteenth and all of the twentieth century would be mostly under the banner of socialism—with the most violent and most obvious and odious form being under the communist branch of socialism.

With the fall of Napoleon, the Illuminists now presented themselves as friends of the monarchies of Europe. Through Freemasonry, they controlled nearly every court in Europe. Freemasons controlled the Court of Berlin as they had done so since the reign of Frederick the Great. Many minor German princes were Freemasons. Freemasons had control of the Court of Vienna since the reign of Joseph II. They guided Alexander of Russia.

When Louis XVIII became the King of France, he placed Talleyrand, Seyies, Cambaceres, Fouche, and other Illuminists in high offices. Illuminists return Louis XVIII’s favor by working to overthrow him. In 1830 they succeeded in driving his brother, Charles X, from the throne,12 and replacing him with Louis Philippe, son of Philippe Egalite, Duke of Orleans. Louis Philippe was a Freemason and was owned by James Rothschild.

Appendix: The Tugendbund

In 1807, Heinrich Frederick Karl vim Stein and Fessler, Councillor of Joseph II of Austria, organized the Tugendbund to liberate the German states from the oppressive rule of Napoleon. (Some historians claim that Stein had no involvement with the Tugendbund.) Earlier Frederick William III had appointed Stein Prime Minister of Prussia. An irony is that Napoleon had encourage Frederick William to appoint Stein as prime minister. Apparently, Napoleon saw Stein as merely a clever organizer and financier who could put Prussia in a position to pay its large war indemnifies to France. Napoleon soon learned about Stein organizing Prussia to oppose him. He then forced Frederick William to dismiss Stein. Stein fled to Austria, and Hardenberg succeeded Stein as the Prussian Prime Minister.

The Tugendbund was a secret society organized throughout Germany. The goal of the Tugendbund was to rejuvenate the German people by promising them constitutional government and a free press. It was given a Christian veneer to deceive Christians into becoming followers of Freemasonry. Among its earliest members were Karl Hardenberg, General Gerhard von Scharnhorst, General Wittgenstein, Field Marshal Gerhard von Blucher, Johann Jahn (professor of the Berlin Gymnasium, Biblical critic), and Ernst Arndt (author). Other members of the Tugendbund were Johann Fichte (philosopher), Gruner (Prussian diplomat and administrator), and Karl Korner (poet). The Tugendbund was instrumental in rallying the Germans to rise and defeat Napoleon. It also advocated for a German Confederation, which Stein viewed as necessary to make the Germans a powerful country. (Under this Confederation, all the German princes would be dethroned except the king of Prussia. The king of Prussia would become emperor of Germany, and Germany would be governed under a democratic constitution.)

References
Allen, Gary. None Dare Call It Conspiracy. Seal Beach, California: Concord Press, n.d. Cahill, E. Freemasonry and the Anti-Christian Movement. Second edition. Dublin, Ireland: M.H. Gill and Son, Ltd., 1930. Reprinted 1952.

Fahey, Denis. Grand Orient: Freemasonry Unmasked as the Secret Power behind Communism through Discovery of Lost Lectures Delivered by Monsignor George F. Dillon, D.D. at Edinburgh, in October 1884. New and Revised Edition. Metairie, Louisiana: Sons of Liberty, 1950.

Fay, Bernard. Revolution and Freemasonry 1680-1800. Boston, Massachusetts: Little, Brown, and Company, 1935.

Frost, Thomas. The Secret Societies of the European Revolutions, 1776–1876. Two volumes. London, England: Tinsley Brothers, 1876.

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

McKilliam, K.R. Conspiracy to Destroy the Christian West. London, England: The Board of Anglo-Saxon Celtic Deputies.

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.

Morton, Frederic. The Rothschilds: A Family Portrait. Greenwich, Connecticut: Fawcett Publications, Inc., 1961.

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.

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

Queenborough, Lady (Edith Starr Miller). Occult Theocracy. Two Volumes. Hawthorne, California: The Christian Book Club of America, 1933.

Roberts, J.M., The Mythology of the Secret Society. New York, New York: Charles Scribner’s Sons, 1971.

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

Webster, Nesta H. Secret Societies and Subversive Movements. Palmdale, California: Omni Publication, 1924.

Copyright©2009 by Thomas Coley Allen.

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French Revolution Part II

The French Revolution
Part II: The Revolution

Thomas Allen

[Editor's note: The footnotes in the original are omitted.]
At their international Congress of Wilhelmsbad in 1782, Freemasons made plans for the French Revolution. Three years later another congress met. This time it met in Paris. Like the previous congress, the Paris Congress of 1785 made plans for the French Revolution. Illuminists attending the Paris Congress included Bode, Baron de Busche, Cambaceres, Marquis de Chefdebien, Danton (Freemason), Duchanteau (Cabalistic Jew), Fouche, Lafayette (Freemason), Marat (a Freemason), Mirabeau (Freemason), Robespierre (Freemason), and Talleyrand (Freemason).[1] Savalette de Langes was elected president.

The Frankfurt Congress of 1786 followed it. This Congress was more secretive and decreed the death of Louis XVI of France and Gustavus III of Sweden.[2]

Following these congresses, the Rite of Perfection, which had been founded in 1754, was reorganized in 1786 and became the Order of the Ancient and Accepted Rite. Frederick the Great wrote the new constitution of this Order. He rearranged the degrees to bring the number up to 33. Frederick became Sovereign Grand Commander. Philippe, Duke of Orleans and Frederick’s lieutenant, became Grand Master of the Grand Orient. Thus, Frederick gained control of Freemasonry in France and carried on the work of Weishaupt and the Illuminati.

After the fall of the Bavarian Illuminati, some Illuminati fled to France and joined the lodge of the United Friends. Two Illuminati, Bode and Busche, meet with Mirabeau, who was also an Illuminate, and Talleyrand in 1787 in Paris. Also attending this meeting were two members of the Strict Observance, Marquis de Chefdebien d’Armisson and Count Leopold de Kollowrath-Krakowski, who was also an Illuminate. With the United Friends lodges, they brought together the revolutionists and subversives in the other lodges and the Grand Orient into one group. These Illuminists were so successful in gaining control of Freemasonry and allied systems in France that even the philosophical political program of the Illuminati replaced Cabalistic magic of the most mystical lodge.[3]

Working in and through Freemasonry, Illuminists organized and orchestrated the French Revolution. The French Revolution was one of the great orgies of blood sacrifices to Lucifer in modern times. The purpose of the French Revolution was to satisfy Lucifer’s lust for blood and to transfer the property of the Church, nobility, and middle class to the bankers and their allied Illuminists. It also sought to destroy the political, economic, and social structure of France. In achieving these goals, the French Revolution was largely successful. By the end of the Reign of Terror, the Illuminists had achieved many of their destructive goals in France as the monarchy, the aristocracy, and Church had all been overthrown.

In England, Prime Minister William Pitt fell under the control of William Petty, Earl of Shelburne. Pitt became heavily indebted. Lord Shelburne and his closest associates paid Pitt’s debt. In turn they gained control of Pitt’s policy decisions. As the chief of the British intelligence, Lord Shelburne intrigued much of the excess of the French Revolution. His agents promoted some of the most atrocious acts of the Reign of Terror.[4]

English money help finance the Revolution. However, the money seemed to have come from sources independent of Pitt and King George III.[5]

The international bankers, led by the Swiss bankers, refused loans to the French government unless Louis XVI appointed Jacques Necker, a German banker, Minister of Finance. Preaching austerity, Necker destroyed the French currency through inflation. The inflation caused even greater unrest. Many suspect that he inflated the currency at the direction of certain Swiss bankers who sought to profit greatly from the demise of France.[6]

Secular humanism, a modernization of the Cabala, also inspired the French Revolution. The Academia of the de Medicis had advanced secular humanism in Florence. From secular humanism came the denial of God. Once God was denied, regicide and mass executions were easy.

Freemasonry had degraded Christianity by placing it on the same level as Judaism, Islam, Hinduism, and all the other false religions. (Perhaps more correctly, all religions were inferior to Freemasonry.) Freemasonry taught that no religion was any better than any other religion. (Thus, it negated all religions.) Religious dogmas were merely personal opinions. The Church should be reduced to executing the will of Freemasonry, which would be "the clearinghouse for ideas and beliefs and the guiding spirit of humanity."[7] Freemasonry had become the new religion.

Furthermore, the nobility also lusted after the property of the Catholic Church. They knew that they could not have it without a civil war. Moreover, the Illuminists wanted to place the Church and its clergy under the control of the government, which they controlled. A new church and religion would be established to enlighten the people with Illuminism.

Also, responsible for the excesses of the French Revolution was the Enlightenment of Descartes. Another culprit was the Positivism of Comte: "God is only an abstraction—he does not exist; only humanity is real."

Once discontent had been fomented and an intense propaganda war waged against Church and state, all that was needed was a fuse to set off the volatile mixture. Philippe, Duke of Orleans, was the fuse. To create a crisis and popular unrest, the Duke of Orleans engineered a food shortage. Illuminists used the resulting famine of 1789 to lead the people into revolt.

From the beginning until the execution of Robespierre, the Jacobins controlled the Revolution. The Jacobins wanted to destroy the monarchy and other existing institutions as a preclude to usher in their New World Order. To achieve their goal, they used a Hegelian formula that has since become a common revolutionary tactic. They hired thugs and encouraged radicals to riot and act lawlessly (thesis). Then influential Jacobins came forth and promised "law and order" (antitheses). Next came oppression and the police state that the Jacobins used to get rid of their enemies and rivals (synthesis).

During the French Revolution, Illuminists used Masonic lodges to carry out the extremes of the Revolution. Illuminists brought about the Reign of Terror during which King Louis XVI and many priests and aristocrats were murdered. Many middle class Freemasons who knew too much were also murdered.

In 1789, France had more than 2000 Masonic lodges with more than 100,000 adepts.[8] The presence of so many lodges in France facilitated the work of British intelligence in exasperating the Revolution.

During the Revolution, the National Assembly had 605 members. Of these, 477 were Freemasons.[9] More than 300 members of the Constituent Assembly were Freemasons.[10]

Freemasons (primarily Lafayette) wrote and approved in 1789 the Declaration of the Rights of Man and Citizens. This Declaration of Rights became the first chapter of the constitution adopted in 1791. It essentially renounced allegiance to Christ and declared that France no longer had any duty to God through Christ. Society was no longer to be organized under Christ the King. The Masonic controlled Constituent Assembly also emancipated the Jews.

Freemasons directed every aspect of the Revolution and profited greatly from it. Survival was difficult for those who were not Freemasons. Many of the most influential and powerful aristocratic families held high positions in Freemasonry in France. For the most part, they and their property survived the orgy of the French Revolution.

Mirabeau’s mentor was Moses Mendelssohn. Under the influence of Mendelssohn, Rothschild, and other conspirators, Mirabeau became an important leader of the French Revolution. He was a high-degree Illuminist. He became a champion of the people, whom he held in contempt and used for political advantage. Although he claimed to represent the people, he was really an agent of the Illuminists. One of his chief jobs was liaison among the Illuminati, German lodges, and the Grand Orient. As a member of the Estates General, his task, which he executed extremely well, was to prevent any reforms that would solve the problems of the nation and relieve discontent from taking place. (Most of the laws enacted during this time were designed to antagonize factory workers, tradesmen, and peasants.) He was also tasked with consolidating political power. (Within a month after convening, the Third Estate had converted itself into the National Assembly and had usurped the powers of the entire Estate General.) His downfall came when he conspired to save the life of King Louis. To silence him, the Illuminists had him poisoned.[11]

Mirabeau and his associates delivered the government of France to the Illuminati with a coup d’etat by the Third Estate when it usurped all the power of the Estate General and converted itself into the National Assembly. This action destroyed the constitution of France. The National Assembly then had a new constitution, the Constitution of 1791, drawn up and adopted. This Constitution consolidated legislative and executive power in the National Assembly. Now the Jacobins openly held power.

Mirabeau and Mendelssohn persuade the Duke of Orleans to make poor investments until he had lost his fortune and was deep in debt. To pay his debt, he forfeited his palace, the Palais Royal, to his lenders. His lenders placed de Laclos in charge of the palace.

De Laclos was a Grand Master of the Rosicrucian Knights of Malta. He turned the Palais Royal into a high class brothel and a headquarters for printing revolutionary pamphlets.

Although the Duke of Orleans was an Illuminist (after all, he was Grand Master of the Grand Orient), he was a not a high-degree Illuminist. To the high-degree Illuminists, he was merely a tool to be used to achieve their goals. He wanted to be king. Using this desire, the Illuminists manipulated him to do their bidding. He only knew part of their plan, the part that the illuminist Mirabeau told him. He did not know that higher Illuminists had no intentions of replacing one monarch with another. Obviously, he had no idea of the extent that the Illuminists were using him. The Illuminists freely used his wealth and influence. He gave the cause all that he had. When the Illuminists no longer had any use for him, he was guillotined.

Two other leaders of the Revolution, Marat and Robespierre, conceived a plan to depopulate France. The plan called for killing as many Frenchmen as possible—at least half the population. Who died did not matter as long as vast numbers died. (Lucifer was thirsty for blood.) Victims were taken randomly; the more innocent, the better. They were all counterrevolutionists, and all counterrevolutionists must be executed. Thus, began the Reign of Terror. (The Illuminists also saw mass execution as a solution to the mass unemployment that their revolution had caused.)

With the Reign of Terror, occultism captured the French Revolution. The Revolution moved into a phase of murder and destruction just for the sake of murder and destruction. It was an "orgy of hatred, lust, and cruelty directed not only against the rich but still more against the poor and defenseless, the destruction of science, art, and beauty, the destruction of the churches, the organized campaign against all that was noble, all that was sacred, all that humanity holds dear."[12] It was a rebirth of Satanism of the fourteenth century. The Cabalists, Gnostics, and other cults had finally succeeded in bringing down Christianity.

The Reign of Terror gave the politically powerful Insiders the opportunity to eliminate their weaker rivals. It also gave the weaker rivals an opportunity to usurp and overthrow their superiors. Not only did many poor, obscure people die during the Reign of Terror, so did many dupes, collaborators, sympathizers, and opportunists. Even some high-degree Illuminists were executed.

The Reign of Terror ended with the deaths of Marat, Robespierre, and Danton. These three had orchestrated the Reign of Terror. Robespierre was convicted of conspiracy and executed from fear that he would reveal the involvement of the Illuminists in the Revolution. Furthermore, he had also ordered the execution of Jean Baptiste Clootz (Anacharsis). Although the Reign of Terror had fallen short of its goal of killing half the French population, it had claimed thousands of lives including some important Illuminists.

Weishaupt had outlined the course of the French Revolution, and it followed his plan with amazing accuracy. He had said that princes were to be used to advance Illuminism. The Illuminists certainly used the Duke of Orleans and his lust to be king. Weishaupt called for enlisting women. The French revolutionists certainly used women—not women of intelligence or energy, but women with "disordered imaginations and perverted passions."[13] His plan called for the destruction of the monarchy, which the French Revolution achieved. It called for the destruction of the Christian religion. Although the Revolution did not fully accomplish this goal, it did inflict great damage with the slaughter of priests and degradation of the churches with the blasphemous and immoral ceremonies performed in them. Weishaupt’s plan called for the destruction of industry and science, and manufacturing towns were ravaged, libraries burned, and scientists executed. When the Reign of Terror ended, France laid demoralized and in ruins, filled with hatred. It was bankrupt—morally, spiritually, physically, and fiscally; Lucifer and his Illuminists had won a great victory. The only real failure in Weishaupt’s plan was inciting a proletariat uprising across Europe. When the proletariat failed to revolt, the Illuminists forced the Jacobins to adopt a nationalistic attitude and launch a program of imperialistic conquest—the Napoleonic Wars.

The French Revolution ended, or more correctly, entered a new phase, when Napoleon, who was a high-degree Illuminist, assumed power. When it ended more than a million Frenchmen had given their lives.[14] This loss was far short of the 12 to 15 million that the Illuminists had slated for death. Like all illuministic revolution, the French Revolution was not a revolution of liberation; it was a revolution of oppression. It never had popular support.


Endnotes

1. Denis Fahey, Grand Orient: Freemasonry Unmasked as the Secret Power behind Communism through Discovery of Lost Lectures Delivered by Monsignor George F. Dillon, D.D. at Edinburgh, in October 1884 (New and Revised Edition. Metairie, Louisiana: Sons of Liberty, 1950), p. 31. E. Cahill, Freemasonry and the Anti-Christian Movement, Second edition (Dublin, Ireland: M.H. Gill and Son, Ltd., 1930. Reprinted 1952), p. 14. Nesta H. Webster, Secret Societies and Subversive Movements (Palmdale, California: Omni Publication, 1924), p. 234.

2. Clarence Kelly, Conspiracy Against God and Man: A Study of the Beginnings and Early History of the Great Conspiracy (Belmont, Massachusetts: Western Islands, 1974), p. 151.

3. Webster, Secret Societies, pp. 236-237.

4. Eustace Mullins, The Curse of Canaan: A Demonology of History (Staunton, Virginia: Revelation Book, 1987), p. 112.

5. The Cause of World Unrest (New York, New York: G. P. Putnam’s Sons, 1920), p 9. Lady Queenborough (Edith Starr Miller), Occult Theocracy (Two Volumes. Hawthorne, California: The Christian Book Club of America, 1933), p. 380.

6. Anton Chaitkin, Treason in America From Aaron Burr to Averell Harriman (New York, New York: New Benjamin Franklin House, 1984), p. 20. Mullins, p. 113.

7. Bernard Fay, Revolution and Freemasonry 1680-1800 (Boston, Massachusetts: Little, Brown, and Company, 1935), p. 297.

8. Mullins, p. 114. Queenborough, p. 337.

9. Queenborough, p.380.

10. Fahey, p. xiv.

11. Kelly, pp. 155-157, 168-169. Mullins, p. 112. Nesta H. Webster, World Revolution: The Plot Against Civilization (Editor Anthony Gittens. Seventh edition. Palmdale, California: Omni Publications, 1994), p. 45.

12. Webster, Secret Societies, p. 246.

13. Webster, World Revolution, p.46.

14. Kelly, p. 164.


[Editor's note: The list of references in the original is omitted.]

Copyright © 2009 by Thomas Coley Allen.

  More articles on history.

French Revolution Part I

The French Revolution
Part I: The Foundation

Thomas Allen

[Editor's Note: Footnotes, most of which contain additional information about the conspirators, in the original are omitted.]

In 1773, Mayer Amschel Rothschild invited twelve wealthy and influential Jews to meet with him in Frankfurt. His objective was to convince them to pool their resources so that they could use their combined resources to finance and control a world revolutionary movement. Through revolution, they would gain control of the world, including its resources and people. The twelve agreed to join with Rothschild in a conspiracy to control the world.[1]

Rothschild’s plan called for wrecking economies to create large-scale unemployment and bringing the masses to near starvation. With their propagandists, they would inflame hatred against the ruling class. They would advocate political freedom to convince the electorate to surrender their power and prerogatives to the plotters and their agents. They would promote moral corruption, drugs, and vice. The conspirators would foment and control wars so that both sides would accrue ever larger debts. They would buy political candidates and officeholders to do their bidding. Rothschild and his co-conspirators would bring down existing governments, with either internal or external foes, and replace them with people under their control.

To aid them in their conspiracy, they got Adam Weishaupt to organize the Order of the Illuminati. The Order of the Illuminati became a front for the Jewish Kahal, the Jewish International World Government. The goal of the Jewish Kahal was to attain political, economic, and moral world dominion[2]—the New World Order.

Adam Weishaupt (Spartacus), who was, according to Louis Blanc, "one of the most profoundest conspirators who have ever existed,"[3] founded the Order of the Illuminati on May 1, 1776 in Bavaria. Duke Ferdinand of Brunswick, Grand Duke Ernest of Gotha, William IX of Hesse-Kassel, Mirabeau, and, probably, Friedrich Christopher Nicolai were also founders of this Order.[4] The Jesuits, Assassins, Roshaniya, ancient Mysteries, and Freemasonry were important contributors to the doctrines of the Illuminati.

Weishaupt based his original inner council on the pentagram, the symbol of Sirius, the Blazing Star. His inner council had five members: Weishaupt himself, Kolmer (who initiated Weishaupt into Illuminism), Francis Dashwood, Alphonse Donation de Sade (from whom comes the word "sadism"), and Meyer Amschel Rothschild.[5]

Weishaupt’s primary proposes for establishing the Order of the Illuminati was to promote secretly his egalitarian goals. The goal of his Illuminati was to abolish (1) all established governments, especially monarchies, (2) all private property and inheritance, (3) nationalism and patriotism, which would be replaced with internationalism and universal brotherhood, (4) marriage and family life, (5) all religions, especially Christianity. Out of the resulting chaos and anarchy would arise a New World Order with its one-world totalitarian government controlled by the Illuminists. His philosophy was based on the philosophy of Jean Jacques Rousseau (private property is the cause of all man’s problems) and the anti-Christian doctrines of the Manichaeans.

To conceal the anti-Christian goal of his Order of the Illuminati, Weishaupt directed that initiates be told that the Order sought to perfect Christianity and that Jesus was the originator of Illuminism. Members were guided from Christianity to Deism, then to atheism, and finally to Satanism. Weishaupt dressed his secret tenets in Christian terminology. Only high degree members knew the true goals of the Order.

He soon used the Illuminati to infiltrate and gain control of Freemasonry. Then the Illuminati used Freemasonry to bring about his goal of infiltrating and then destroying all governments and religions and setting up a New World Order ruled by the Illuminati.

Weishaupt, who was a Jew who converted to Catholicism,[6] may have been a Jesuit priest.[7] At least Jesuits had previously held the position of professor of canon law at Ingolstadt University to which he was appointed in 1773. Regardless of his background, the maliciously anti-clerical Weishaupt was placed in charge of instructing students in the canons of the Church. Two years later he became dean of the Faulty of Law.

As a professor, Weishaupt advocated freedom from religious restraint and from legitimate civil authority. His teachings met strong opposition from the Jesuits. By accusing the Jesuits of being "the secret force behind the subversive secret societies," the Illuminists were able to get them expelled or suppressed in several countries. Finally in 1773, the pope dissolved the society. (However, Frederick the Great of Prussia not only did not abolish the Jesuits in Prussia; he protected and encouraged them.)

Weishaupt, who became a Freemason in 1777, was a member of the Masonic Lodge Theodore in Munich. Kolmer had initiated him into an ancient order and the Mysteries of the East in 1771. Weishaupt appears to have become a Satanist. Nevertheless, Weishaupt emphasized rationalism over mysticism and Theosophy.

Weishaupt did not originate the destructive doctrines that he advocated. He did not corrupt Freemasonry; it was corrupted before he came on the scene. He saw Freemasonry as an institution to be used to achieve his goals and proceeded to organize and control it toward that end. His goals were consistent with Freemasonry. Furthermore, the anti-Christian conspiracy was already in place waiting for him to organize, direct, and complete.

Backing Weishaupt, who was the supreme head of the Order of the Illuminati, were some of the leading Jewish bankers of Europe. His backers included Moses Mendelssohn, Daniel Itzig, Benjamin and Abraham Goldsmid, Moses Mocatta, Meyer Cerfbeer, and David Friedlander.[8] (Bernard Lazard, a Jewish writer, asserts that "there were Jews, Cabalistic Jews, around Weishaupt."[9])

Weishaupt welded together a highly efficient system. He combined "the disintegrating doctrines of the Gnostics and Manichaeans of the modern philosophers and Encyclopaedists, the methods of the Ismailis and the Assassins, the discipline of the Jesuits and Templars, the organization and secret of the Freemasons, the philosophy of Machiavelli, the mystery of the Rosicrucians."[10] He was a master at using people.

The goal of the Illuminati was (and is) to destroy utterly Western Christian society. It sought to destroy all political and religious authority. Private property was to be abolished. Nationalities were to be obliterated. Society was to be reorganized with the masses reduced to slaves ruled by the masters, the Illuminati, who would have absolute and unchecked power. Then universal equality would be achieved. Weishaupt’s goal was to destroy all existing governments and religions and to establish a New World Order. Being an extreme materialist, he had utter contempt for all religions; their only useful purpose was for him to use to deceive, manipulate, and control. This New World Order would have a totalitarian world government with a libertine Luciferian religion. Weishaupt and the Illuminati selected France as the country in which to begin the revolution.

Weishaupt demanded that members of the Illuminati dedicate themselves totally to the work of the Order. They had to place at its service all that they had—their honor, liberty, property, and life. They had to abandon all allegiances to country and Church. Furthermore, they bound themselves to secrecy and pledged unquestionable obedience to all commands of their unknown superiors.

Rich men were recruited for their money. Women were recruited because they were easy to lead (mislead) and because they could be used to influence prominent men. University professors and teachers were recruited because they could train and recruit young professionals. Religious leaders were recruited partly because Weishaupt enjoyed corrupting them and partly because of their influence. Judges, political leaders, and high-level bureaucrats were also recruited. Most members were to be kept ignorant of the true goals of the Order. They were to remain ignorant of higher ranks until they had been groomed enough to advance. Only adepts of the highest ranks knew the true goals of the Order.

Members were incited to spy on one another and on their friends, families, neighbors, and all whom they encountered. They were to discover weaknesses that the Illuminati could use to advance their cause. Members had to reveal compromising information, such as an unknown criminal act or sexual indiscretions that superiors could use as blackmail, or members would be required to commit a crime that superiors could use against them.

Among the members of the Illuminati were Prince August Karl von Hardenberg, Christian Bode (Freemason, privy councillor of the Prince of Hesse-Darmstadt), Cagliostro (known as the "Prince of Mystery"), Prince Charles of Hesse, Jean Baptiste Clootz (Anacharsis), Count Ludwig Cobenzl, Marquis de Constanza (Diomedes, secretary of the Order) Friedlander (Jewish banker), Johann von Goethe, Johann von Herder, Hertel (Marius), Itzig (Jewish banker), Immanuel Kant (philosopher), Baron Adolph von Knigge (Philo), Count Leopold de Kollowrath-Krakowski, Baron Maendl (Freemason and Chamberlain of the Elector of Bavaria), Massenhausen (Ajax), Moses Mendelssohn (Jewish philosopher and silk merchant), Mirabeau (a leader of the French Revolution), Baron de Montgelas, Wolfgang Amadeus Mozart (composer, Freemason), Christopher Friedrich Nicolai (publisher of a literary review in Berlin, Freemason), Mayer Amschel Rothschild (Jewish banker, founder of the House of Rothschild), Count de Saint-Germain, Count Aurelio Saviola (keeper of the archives of the Order ), Frederick von Schiller (poet), Baron von Schroeckenstein (Mahomed), Baron Joseph von Sonnenfels, Voltaire (philosopher), Christoph Wieland, and Xavier von Zwack (Cato, Freemason, lawyer, Privy Councilor to Prince von Salon).[11]

In 1782, Ferdinand, Duke of Brunswick, acting as Supreme Grand Master, called the Congress of Wilhelmsbad. This meeting became known as "the Convent of Wilhelmsbad." Delegates came from every part of the British Empire, all the countries of Continental Europe, the colonial possessions of France, Holland, Portugal, and Spain, and the United States. At least three million members of secret societies from around the world were represented at the Congress of Wilhelmsbad. Among the attendees were Bode, William Dohm, Knigge, Gotthold Lessing, Mirabeau, Saint-Germain, Saint-Martin, Lord Shelburne (William Petty) of England, and Willermoz. Two of Weishaupt’s associates, Knigge and Dietrich von Dittfort control the convention. Willermoz presided over the convention.[12]

The Illuminati had infiltrated Freemasonry and eventually had gained control of it. At the Congress of Wilhelmsbad, Weishaupt with the aid of Knigge and Dittfort formally combined the Order of the Illuminati with the Freemasons. Other secret societies, such as the Martinists, Rosicrucians, Templars, Knights of Beneficence, and the Brothers of Amity, were also united with the Illuminati and Freemasonry at the Congress. The Congress of Wilhelmsbad also united Freemasonry and allied secret societies with the international financiers. The resulting organization contained some of the most powerful men in Europe.[13]

When the Congress of Wilhelmsbad adjourned, two important accomplishments had been achieved. One, the various secret societies of Europe had been consolidated into Freemasonry and had become universal. Frederick the Great became the Grand Master of universal Freemasonry. Two, the Illuminati had ascended into leadership.[14] Thus, Weishaupt and his associates and backers could now carry out what Kelly calls the "Great Conspiracy" and Webster calls the "World Revolution."

Through Knigge, Weishaupt got the Congress of Wilhelmsbad to approve his plan and goal of the Great Conspiracy. That plan included Pantheism and communism of women, goods, and general concerns. Execution of the plan called for the destruction of the Church and Christianity and the elimination of all existing civil governments. The resulting void would be filled by a utopian universal republic where absolute equality, social brotherhood, and licentiousness would prevail and all social, moral, and religious restraints would be abolished.

Weishaupt established higher degrees and initiated suitable Freemasons and his own people into these higher degrees. As a candidate rose to higher degrees, he learned more about the nature and true goals of the Order of the Illuminati and Freemasonry. If he were found suitable for further illumination, he would rise to the next degree. If he were found unreliable, his advancement ceased. By controlling the higher degrees, the Illuminati controlled the Masonic lodges and used them to destroy society.

As with other illuministic societies, the greatest virtue that an Illuminate could possess was blind and unquestionable obedience to unknown superiors. Without such obedience, an Illuminate could never rise. He had to subordinate all national, religious, and patriotic allegiances and sentiments to his unknown superiors.

Only select Freemasons from the highest degree were aware of Weishaupt’s plans. Only those Freemasons who had completely rejected the God of the Christians and His Son, Christ Jesus, were initiated into the highest degree and became privy to the purpose of the Illuminati. These adepts of the highest degree became, in effect, high priests of the Synagogue of Satan. Lucifer became the god whom they worshiped. (The worship of Lucifer does not require religious ceremonies and overt acts of worship as occur in most religions. The act of blasphemy or rejecting the God of the Christians, Christ, or the Church is an act of worshiping of Lucifer.)

To thwart rivals within Freemasonry, lodges could not send local money to affiliated superiors. The Illuminati had independent sources of money and did not need local money.

Through power, money, sex, and blackmail, the Illuminati brought influential people under its control. Young people from the well-bred families were selected for indoctrination at prestigious schools. Thus, the Order of the Illuminati became "the Master Conspiracy of the Great Conspiracy."[15]

Like today’s illuministic conspirators, the Illuminati advanced their ideology by promoting and supporting their members, agents, sympathizers, and fellow travelers in key positions in government, business, academia, and religion. By controlling these important and influential positions, they could promote and carry out their plans of world domination. From the beginning, they have promoted wars and revolutions on an ever increasing scale.

Accompanying the union of secret societies in Europe was a movement to emancipate the Jews. Jews began to be presented as innocent victims of cruel barbarous Christians. Backing this movement was Prussia. The Congress of Wilhelmsbad issued an edict that Masonic lodges were not to exclude Jews.

The Congress of Wilhelmsbad also decided to move the headquarters of illuminized Freemasonry to Frankfurt. Frankfurt was the center of Jewish financiers: Mayer Amschel Rothschild, Oppenheimer, Schuster, Speyer, D. Stern, and Wertheimer. The plans for the upcoming illuministic world revolution were formulated at the Frankfurt lodge.

In 1784, Elector Carl Theodore of Bavaria outlawed all secret societies, which included the Order of the Illuminati, not recognized by the state. The Illuminati responded by ignoring the edict. In spite of the counsel of his advisors, the Elector had issued the edict. His advisors, who were Illuminati, had greatly ridiculed and expressed considerable doubts about the existence of a conspiracy. Urging the Elector to ignore all evidence of a conspiracy were the conspirators themselves.

Following his edit, the Bavarian government began investigating the Order of the Illuminati. In 1785 the Elector suppressed by name the Order of the Illuminati, and the pope condemned the Order.

When in 1785 Weishaupt’s leadership of the Order of Illuminati became public, he fled Bavaria. He took refuge with the Ernest Louis, Duke of Saxe-Gotha. Here he continued to direct the Order.

The Illuminists turned the Bavarian disaster into a propaganda coup. They proclaimed that Illuminism was dead; the New World Order of the Illuminati was no more. Most people believed the lie. (Many still do.) With public anxiety allayed, the Illuminists became even more powerful.

Although the Order of the Illuminati was outlawed and suppressed in Bavaria and its leader exiled, the important leaders were not arrested or imprisoned. They continued to operate outside Bavaria. Though the Bavarian incident may have destroyed the Order of the Illuminati as a formal society, it did not, however, destroy the Illuminati or Illuminism. The Illuminati merely reorganized. Most likely, the German Union, which Knigge and Charles Frederic Bahardt (a Freemason) attempted to illuminize, was part of this reorganization.[16]

Ostensibly, the German Union was established to oppose those who wanted to suppress "Reason." The stated goal of the German Union was to promote naturalism, to destroy enslaving superstition, i.e., organized religion, and to enlighten mankind. It sought to restore man to his true state of liberty and equality. The German Union was not very successful, but its successor, the Tugendbund (Union of Virtue), which was organized primarily as a political league, was.

After the suppression of the Bavarian Illuminati, Mirabeau carried Illuminism to France where he initiated the Duke of Orleans and Talleyrand. Sieyes and Condorcet soon joined. Barnave, Brissot, Claude Fauchet (a Freemason), Lafayette, and Duke Francois de La Rochefoucauld also became Illuminati. By the time that the French Revolution began, the doctrines of Weishaupt had permeated every lodge of the Grand Orient of France. To Bode and Busch goes much of the credit of this indoctrination.

Although the Order of the Illuminati seems to have disappeared when the Elector of Bavaria outlawed it and Freemasonry in 1785, its philosophical being lived on in Freemasonry and other secret societies. The Order’s ideology and practices lived on (and, indeed, are alive and more vigorous than ever today). Its leaders moved on to organize new societies and to take control of other secret societies, especially Freemasonry with which it had merged at the Congress of Wilhelmsbad in 1782.

Endnotes
1. Eustace Mullins, Federal Reserve (1991), p. 54.

2. Lady Queenborough (Edith Starr Miller). Occult Theocracy (Two Volumes. Hawthorne, California: The Christian Book Club of America, 1933), p. 184, 371.

3. Nesta H. Webster. Secret Societies and Subversive Movements (Palmdale, California: Omni Publication, 1924), p. 207.

4. Clarence Kelly, Conspiracy Against God and Man: A Study of the Beginnings and Early History of the Great Conspiracy (Belmont, Massachusetts: Western Islands, 1974), p. 105. Eustace Mullins, The Curse of Canaan: A Demonology of History. (Staunton, Virginia: Revelation Book, 1987), p. 92. Queenborough, p. 184. Webster, p. 205.

5. Terry Melanson, "Illuminati Conspiracy, Order of the Illumined Wise Men," http://www. conspiracyarchives.com/NWO/Illuminati.htm, Dec. 12, 2002.

6. Salem Kirban, Satan’s Angels Exposed (Huntingdon Valley, Pennsylvania: Salem Kirban Inc., 1980), p. 147. Archibald E. Roberts, Emerging Struggle for States Sovereignty (Fort Collins, Colorado: Betsy Ross Press, 1979), p.153.

7. K.R. McKilliam, Conspiracy to Destroy the Christian West (London, England: The Board of Anglo-Saxon Celtic Deputies), p. 5.

8. Mullins, Curse of Cain, p. 92. Queenborough, p. 184

9. Webster, p. 228.

10. Ibid., p. 231.

11. Una Birch, Secret Societies and the French Revolution Together with Some Kindred Studies (New York, New York.: John Lane Co., 1911), pp. 50, 52. Jacob Katz, Jews and Freemasons in Europe 1723-1939. (Translator Leonard Oschry. Cambridge, Massachusetts: Harvard University Press, 1970), p. 73. McKilliam p. 6. Queenborough, p. 371, 373-374. J.M. Roberts, The Mythology of the Secret Society (New York, New York: Charles Scribner’s Sons, 1971), p. 124. William T. Still, New World Order: The Ancient Plan of Secret Societies (Lafayette, Louisiana: Huntington House Publishers, 1990), p. 74. Webster, p. 236.

12. Denis Fahey, Grand Orient: Freemasonry Unmasked as the Secret Power behind Communism through Discovery of Lost Lectures Delivered by Monsignor George F. Dillon, D.D. at Edinburgh, in October 1884 (New and Revised Edition. Metairie, Louisiana: Sons of Liberty, 1950) p. 27. 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. 240-241, 253. Queenborough, p. 353. James W. Wardner, Unholy Alliances: The Secret Plan and the Secret People Who Are Working to Destroy America (James W. Wardner, 1996), p. 39.

13. Fahey, p. 46.Gary H. Kah, En Route to Global Occupation (Lafayette, Louisiana: Huntington House Publishers, 1992), p. 25, 108. Kelly, p. 90. Mullins, Curse of Canaan, p. 92.

14. The Cause of World Unrest (New York, New York: G. P. Putnam’s Sons, 1920), p. 11.

15. Kelly, p. 107.

16. Ibid, p. 133.

17. Queenborough, pp. 374-375.

18. Birch, p. 54.

[Editor's note: The list of references contained in the original is omitted.]

Copyright © 2009 by Thomas Coley Allen.

 More articles on history. 

Response to Dale’s Analysis of "There Is Enough Gold"

Response to Dale’s Analysis of "There Is Enough Gold"
Thomas Allen

This article is a response to "Analysis of Thomas Allen’s There Is Enough Gold" by Byron Dale. Mr. Dale’s analysis can be found at http://www. chrismartenson.com/print/25550.

Judging from Mr. Dale’s comments, I failed to explain myself adequately on several points. On the other hand, Mr. Dale’s comments are colored by his obsessive hatred of interest, dislike of bankers, conviction of the inadequacy of gold, and love of paper money if the government issues it instead of banks. (Of coarse, one could say that my disdain of fait money and monopolistic control of the monetary system and adoration of freedom and liberty distort my views.) I could include his abhorrence of our current debt-based monetary system, but I loathe it even more than he does. After all, he wants to maintain a fiat monetary system run by bureaucrats and politicians whereas I do not.

To understand Mr. Dale’s comments better, one needs some knowledge of his reform. He proposes that the U.S. government print and spend paper money into circulation to build and maintain roads. It would not be issued for any other purpose. He writes, "The spending of the paper money would be limited to building roads which would be of equal benefit for all. Since roads can only be built by labor, in reality, all that would be done would be to monetize labor. As the money was spent, it would flow into circulation and we would all have debt-free money with which to meet our needs for a medium of exchange based on labor performed."[1]

The reform that he proposes in his book is much closer to the current system than my proposal. He maintains a fiat paper dollar currency. He only changes who issues the money (the government instead of the Federal Reserve and banking system) and how it is issued (direct spending by the government on road construction instead of lending.) My system scraps the current system entirely including abandonment of the paper dollar and a central body managing the money (both retained by Mr. Dale). It replaces the current system with an entirely new system. (Actually, it is not really all that new; it is similar to the system that existed before 1860.) Under my proposal, the government does not create and spend money into circulation. Banks do not create and lend money into circulation. Mr. Dale’s monetary reform makes only superficial changes instead of fundamental changes as I propose. A more detailed discussion of his proposal as presented in his book Bashed by the Bankers can be found in my booklet "Analysis of Byron Dale’s Monetary Reforms as Presented in Bashed by the Bankers."

Mr. Dale seems convinced that all monetary problems relate to charging interest on loans. He seems to believe that most, if not all, monetary problems would vanish if the charging of interest were outlawed. Does this disdain for interest come from the bad experience that he suffered for failure to pay a loan?

One could add that he despises debt-based money. However, that would be a mistake. As he proposes to replace the current interest-bearing debt-based money with non-interest-bearing debt-based money, his problem is with interest-bearing and not with debt-based.

Now, let’s look at his comments to my article.

Mr. Dale errors when he claims that "the markets did not regulate the gold supply. Miners of gold supplied the gold and they, for the most part mined all that they could find as fast as they could."[2] First, smart miners do not necessarily mine all that they can as fast as they can. Smart miners mine at a rate that maximizes their return. Furthermore, the consumer is the final determinant in the quantity of gold mined by his consumption of gold and gold products.

Apparently, I failed to add enough detail here. Under the classical gold standard the markets regulated the quantity of gold coins and gold bullion used as money. If the markets demanded more coins, jewelry, flatware, and other items of gold were converted to coins. Gold dealers and others presented this gold to the mint for coinage. If the markets decided that too much gold was being used for money, people would melt the excess gold coins and use the gold for other purposes, such as gold teeth and jewelry. (The markets are essentially the sum of every individual acting independently according to his economic contribution.)

Several times Mr. Dale used one of the favorite arguments against the gold standard: The gold mining industry decides how much gold is available. Mr. Dale is correct that the desire for profit drives gold miners. However, gold miners are not particularly concerned about the monetary needs of the country. This argument that gold miners decide the amount of gold available for money fails on at least four accounts.

"First, current mining of gold provides only a small fraction of gold available for monetary use. Nearly all the gold ever mined is available.

"Second, when the real bills doctrine and decentralized banking accompany the gold standard, the quantity of paper money (credit money) available does not correspond to the quantity of gold available. Bank notes and checkable deposits can expand and contract to meet the needs of commerce independently of the quantity of gold. Gold mining does not have a monopoly on gold-based money. [Mr. Dale rejects this fact.]

"Third, gold’s monetary value depends on the integrity of the monetary unit and its issuer and not just the quantity of money. Having a definite fixed monetary unit is more important than the actions of gold miners.

"Fourth, the profit motive guides gold miners. They have an incentive to provide their customers as much gold as they demand in a cost-effective way. Profits of gold mining increases as output increases and production cost decreases."[3]

Gold miners may influence the quantity of gold available, but they do not decide how much of the available gold is used as money.

Mr. Dale claims that using real bills of exchange as money is using paper debt-based money. Like most people, Mr. Dale confuses a debt-credit instrument, i.e., a loan, with a market-clearing-credit instrument, i.e., a real bill of exchange. Real bills are not loans.

"Real bills should not be confused with loans. They are not loans; they are deferred payment. They are used ‘as means of payment [that] have the effect of making commodities [i.e., goods] circulate more rapidly, without the use of money.’[4] They are claims to future money and, as such, evidence of credit transactions. The holder of a bill redeems it on the date specified on the bill for money paid by the person on whom the bill is drawn. Real bills are short-term credit that matures into gold or silver within 90 days.

"The retailer is not borrowing from the supplier, and the supplier is not lending to the retailer. Moreover, the retailer does not retire a loan if he pays his bill before maturity. Real bills finance the production and distribution of goods without debt.[5] They are a form of credit that is not a debt.

"When a bank buys a real bill, it does not make a loan. When a bank buys a real bill, it is clearing and not lending.[6] Therefore, real bills should be considered clearing instruments instead of credit [debt] instruments."[7]

The real bills doctrine automatically provides the markets with the money to buy new goods at the time those goods are being offered for sale. It saves capital for production by eliminating the need to withdraw savings for market clearing (selling new goods). When the goods have been sold (consumed), the new money is withdrawn from circulation and is permanently retired. The new money withdrawn is either the new money created by this real bill or an equivalent amount created by other real bills.

For a more detailed discussion of the real bills doctrine see Reconstruction of America’s Monetary and Banking System by Thomas Coley Allen (pp. 174-194), Antal Fekete’s lectures on the real bills doctrine at http://www.silverbearcafe.com/ private/fekete.html, and articles discussing the real bills doctrine at http://www. safehaven.com/searchresults.cfm?c=real+bills&ct=Any&x=&t=on&ab=on&fm=&fd=&fy=&tm=&td=&ty=&cat=&l=10.

Like most people, Mr. Dale has little understanding of the true gold standard. He states, ". . . the monetary unit is named the dollar. Let’s say that the monetary unit is specific weight of gold, one grain of gold. The price of gold is then one dollar per grain. Therefore one has fixed the price of gold or no one would know what a dollar is." Mr. Dale claims that I error when I state that "the price of gold is not fixed. The monetary unit is a specific weight of gold." While trying to refute my position, he supports it with his example. He states "that the monetary unit is a specific weight of gold, one grain of gold." Then he erroneously concludes that "the price of gold is then one dollar per grain." No, it is not. If the dollar equals one grain of gold, to say that the price of gold is a dollar is absurd. It is like saying that 16 ounces equals a pound; therefore, the price of a pound is 16 ounces. The dollar has been defined as one grain of gold. The dollar is a unit of weight like the pound or gram. It is just limited to gold. The dollar is fixed in terms of gold; gold is not fixed in the terms of the dollar.

This discussion may seem to be an unimportant discourse about semantics. It is not. The distinction is highly important. Is gold to be fixed in dollars, i.e., gold is priced in dollars? That is, the government declares that the dollar is an abstraction, and it has arbitrarily fixed the price of gold. This notion leads quickly down the road to paper fiat money. On the other hand, is the dollar to be fixed in gold, i.e., the dollar is a unit of weight of gold. The government declares the dollar to be a tangible and defines it as a measurable amount of gold. This notion is the essence of the gold standard; the monetary unit is a weight of gold.

Mr. Dale’s comment on my free coinage statement is absurd. Did I really have to add that the law, Congress, defines the monetary unit, the dollar, as so many grains of gold, e.g., 23.22 grains in the Gold Standard Act of 1900. Using this standard, the mint produced a $10 coin containing ten times the weight of gold as a $1 coin if $1 coins were produced at that time. (This is what the Constitution means by "regulate the value thereof.") If the dollar were an abstraction as Mr. Dale promotes instead of a specific unit of weight, then the amount of gold in a $10 coin need not have any relationship to the amount of gold in a $1 coin. That the weight of gold in a $10 coin is ten times the weight in a $1 coin is further proof that the dollar is (or was) a unit of measure for weight. It evidences that the dollar is defined in terms of gold instead of gold being defined in terms of the dollar.

I write that a component of the gold standard is that "no restrictions are placed on exporting or importing gold." Like many people, Mr. Dale expresses great concern that too much gold would be exported, the country would lose most of its money, and people would lack money with which to trade internationally. (People who express this concern about the exportation of gold have little confidence in the free market—especially with money. Moreover, they never seem to be concerned about the excessive importation of gold. Excessive importation can be more disastrous than excessive exportation as witnessed by its destruction of the Spanish empire.) Although Mr. Dale does not mention it, the same problem can occur between regions in the same country. If a country’s gold stock declines enough to affect its value, i.e., causes the value of the remaining gold to rise (which usually results in general prices declining), gold will automatically begin coming into the country. If barriers are not erected to impede the movement of gold, people from countries with an abundance of gold will come with their gold to buy the bargains in countries deficient in gold. Prices of goods in countries deficient in gold are lower than they are in countries with an abundance of gold. (Prices adjust to the quantity of money available—a fact that Mr. Dale seems not to know.)

I note that a component of the gold standard is that "all paper money is redeemable in gold on demand." Mr. Dale cannot possibly be as ignorant as his comment suggests. He comments, "[I]f gold is the money, what is the paper money he is talking about, where does it come from and how does it get into circulation?" He knows the answer to this question because several paragraphs above he comments on the paper money component of the monetary system that I am presenting and refers the reader to the parts of my article where I discuss this paper money, where it comes from, and how it gets into circulation.

Where does Mr. Dale get this notion that adherents of the gold standard want to outlaw paper money? I have never found one that does. Adherents of the gold standard do disagree about whether all paper money should be warehouse receipts, i.e., all paper money is fully (100 percent) backed by gold, or not fully backed by gold. They all agree that all paper money, whether fully backed or not, should be redeemed in gold on demand and should never be legal tender. (A few adherents of the gold standard would allow issuers of bank notes to delay redemption if the note carried a notice that redemption could be delayed.)

Another component of the gold standard that I give is that it is self-regulating and automatically adjusts to meet the demand for metallic money. Mr. Dale asks how this supply would be self-regulating. He is convinced that "the gold miners would regulate the supply of gold by how much gold they found and mined." Gold miners do add to the supply of gold by the amount that they mined. However, unless they are coining their gold, they are not adding to the monetary stock. (The exception is the Rothbard school, which claims that all gold regardless of form—the weight of the metal and not its form makes the money—is part of the monetary stock. I doubt that Mr. Dale is of the Rothbard school.) The markets decide how much gold is being used as money. It decides that by the quantity of gold brought to the mint for coinage and by how many coins are melted for other uses. If the value of gold in jewelry, for example, begins to rise in relationship to the value of gold in coins, people will melt the coins and convert them to the more valuable jewelry until the value of the two are brought back in line. If the value of gold in coins begins to rise in relationship to gold in jewelry, people will convert the gold in jewelry into coins until the value of the two are brought back in line. This example ignores the artistic work of jewelry as is commonly done in India and other countries.

I also note that no monetary policy is necessary and none is desirable. Mr. Dale asks, ". . . if the monetary unit is set by a specific weight of gold isn’t that monetary policy?" I suppose in the broadest sense that defining the monetary unit as a specific weight of gold is a monetary policy in the same sense as defining the pound and foot is a weights and measure policy. However, when people think of monetary policy, they normally think of the government or its central bank manipulating the money supply to achieve some goal, such as interest rates, general price levels, employment, or road construction.

To my statement that "the government does not issue any paper money," Mr. Dale makes another ridiculous comment: "If there is enough gold for a workable money system and the people choose to use that system why would there be any need for any paper money." For some transactions, such as transferring gold from one account to another, which is what a paper check does, or for making large purchases, which is more convenient with paper bank notes, people find paper money more suitable. Mr. Dale knows this. He says so in his book. Why does he make such an absurd statement? Does he want to belittle supporters of the gold standard? He seems to preclude any use of paper money when the standard money is gold coin.

Mr. Dale seems to be almost as obsessed with gold miners as he is with interest. I state that "Gold coins are the property of the individual holding them. . . . No restrictions or controls are placed on the private ownership of gold." He responds, ". . . that sounds good until the miners decided . . . to loan all the gold they mined into circulation as interest-bearing loans." If the gold miners decided to do this, which is highly unlikely, they would only be lending about 2 percent of the world gold stock. The other 98 percent is available for monetary use without borrowing or lending. Are people really going to borrow that 2 percent? Mr. Dale keeps trying to confuse the gold standard with the current federal reserve dollar standard where money is created through the lending process.

Mr. Dale claims that I am contradicting myself when I write, "The government's monetary duties are limited to defining the monetary unit, coining all gold presented to it for coinage and guaranteeing the weight and fineness of such coins. . . ." He asserts that these duties conflict with specifying the monetary unit as a specific weight of gold. What does he think "defining the monetary unit" is? It is specifying (defining) the monetary unit as a specific weight of gold. Where is the conflict? If the government is arbitrary in its declaration of the monetary unit, perhaps a conflict exists. However, if it merely codifies what the markets have already decided as Congress did with the Coinage Act of 1792, no conflict exists.

He also asserts that these duties conflict with free coinage of gold. "Coining all gold presented to it for coinage" is free coinage. I clearly define free coinage as such several sentences earlier. So, I repeat, where is the conflict?

Apparently, in trying to overcome the excessive emphasis that most people placed on the quantity of money while ignoring its quality, I may have over emphasized the quality aspect. As Mr. Dale notes, both are important.

I was trying to stress that the quality of money, i.e., the purchasing power of the monetary unit, is more important than the quantity of money, i.e., the number of monetary units. The more that a given quantity of money can buy, the higher is its quality. The less that quantity buys, the lower is its quality. High quality money can buy a large amount of goods with a small quantity of money. Low quality money requires a much higher quantity of money to buy the same amount of goods. The federal reserve dollar is low quality money, and the gold dollar is high quality money. A gold dollar has the purchasing power 50 times greater than a federal reserve dollar. Fifty federal reserve dollars are needed to do the work of one gold dollar. Thus, a large quantity of low quality federal reserve dollars are needed to do the work of a high quality gold dollar. It is obvious from Mr. Dale’s comments that he thinks in terms of quantity (the more, the better) instead of quality (the higher, the better). Would he really prefer ten million Zimbabwe dollars (July 2008 vintage) to one euro? If he thinks in terms of quantity, he would prefer the ten million Zimbabwe dollars. If he thinks in terms of quality, he would prefer the one euro.

Mr. Dale continues to harp on my not explaining how the markets regulate the money supply. Mr. Dale, you got at least to meet me part way. I explain several times in my article how the markets regulate the money supply. Again, here it is. For metallic money, it is done through free coinage. The mint coins all the gold presented to it for coinage, and the people may melt all the coins that they desire for other usages. The quantity of coins is maintained through minting and melting such that little or no difference exists between the value of gold in coins and gold in other forms. All of this is done without any decision by any political body or governmental bureaucrat.

To this is added the market-driven changes to the money supply through the real bills doctrine or commercial money principle, with which Mr. Dale disagrees. I explain below how money is created under the real bills doctrine.

I have failed to explain myself adequately if Mr. Dale concludes that I am saying "that no one can purchase things with fiat money." People have been buying things with it in the United States since 1933. When I write that "fiat money lack quality," I do not mean that it cannot function as a purchasing medium. I mean that its purchasing power steadily declines over time. Thus, it is a poor store of value. Being a poor store of value, it is a poor measure of value and a poor unit of accounts resulting in arbitrary inflation adjustments being made. Usually, it represents nothing tangible, or at least the issuer is not required to covert it into something tangible on demand.

I do not understand why Mr. Dale fails to find me distinguishing between metallic money and credit money. In the sentence following his comment, I make such distinguish. I give a thorough discussion of the gold standard (metallic money) and the real bills doctrine (credit money).
Mr. Dale claims that my statement about the 100-percent gold standard is false. It is not. Under the 100-percent gold standard, all paper money is merely a warehouse receipt for gold, i.e., all paper money is backed 100 percent by gold.

Mr. Dale errors when he says, especially if he claims that I say, that the "real bills doctrine based on bank created money loaned into circulation at interest is a good money system because it is based on production." I do contend that the real bills doctrine creates credit money based on production. I deny that it is "based on bank created money loaned into circulation at interest." A monetary system based on the gold standard and the real bills doctrine can function without banks although not as efficiency. The real bill itself is money, commercial money. It can be used to discharge debt. If the owner of the real bill sells it to an investor, the investor buys it at a discount. The discount, which is not an interest rate, varies with the maturity date of the bill. Like all prices not fixed by the government, the markets fix the rate.

If he sells it to a bank, the bank buys it with bank notes or checkbook money, i.e., credits the seller’s checking account with the amount of the real bill. The bank is not lending, much less lending at interest. Savers fix the interest rate by their propensity to save. Consumers fix the discount rate by their propensity to consume. Moreover, the bank is not creating money in the true sense. The money creation is done when the retailer accepts (signs) the real bill of exchange. What the bank has done is to convert commercial money (the real bill of exchange) to bank money (checkbook money and bank notes). This action is akin to someone depositing federal reserve notes with a bank and having the bank credit his checking account with the amount of the deposited notes. The bank has merely converted one form of money, the federal reserve notes, to another form, checkbook money.

Mr. Dale keeps repeating that I "never seem to be able to tell us just how a person acting in his individual capacity can product [sic] any kind of money." I have already explained how an individual can convert gold into money by having it coined.

Although an individual seldom converts his labor into money acting as an individual, he can do it cooperatively under the real bills doctrine. If he is part of the work force of a factory, his labor is "monetized," so to speak, into commercial money through the real bill of exchange process. To simplify, I assume that the manufacturer sells directly to the retailer. When the manufacturer sells to the retailer, he offers and the retailer accepts a real bill of exchange. Thus, they have created money, commercial money. With the labor of all the individual factory workers, this money has been created. It is a representation of all the individual workers’ contribution to the finished product. As these workers produce more, they cause the creation of more money.

Mr. Dale vehemently disagrees with my characterization of fiat money. I contend that the government or its central bank arbitrarily regulates the money supply. He asserts, ". . . the key distinction between fait money and gold is wealth based money vs. interest-bearing debt based money." His definition of fiat money is unique. (He probably created this unique definition to avoid his proposed fiat money being called fiat money, which it really is, by contending that wealth-based money is not fiat money. He claims that his proposed money is wealth-based because it is issued to build roads.) If it is interest-bearing debt-based money, it is fiat money. If it is wealth-based money, it is not. By his definition, the French assignat was not fiat money as it was based on land. Every economist whom I have read who has commented on the assignat considers it fiat money. I am not sure how Mr. Dale would classify the U.S. note as it was neither interest-bearing debt-based money (although it was debt based) and was not wealth based between 1862 and 1879 and after 1932. (Mr. Dale probably considers it wealth based between 1879 and 1932 when it was redeemable in gold on demand.)

The definition of fiat money used by many monetary economists is that the money supply is controlled arbitrarily instead of being regulated by the markets. This is its most important aspect. Secondarily, the material of which the standard money is made has less value than the money itself. These are the two criteria that I use for mydefinition.

His comment on fiat money was written to my sentence: "The key distinction between fiat money that uses gold and the true gold standard is the way that the money supply is regulated." I am claiming that gold can be part of a fiat monetary scheme. Mr. Dale seems to be arguing that gold, regardless how the quantity of monetary gold is regulated, is not fiat money. (What about gold lent at interest into circulation? Is that fiat money?) Yet he also seems to consider the federal reserve dollar to be interest-bearing debt-based money from its beginning in 1914 and, therefore, is fiat money. Between 1914 and 1933, the federal reserve note was not legal tender and was redeemable in gold on demand. Was it fiat money? I say no because it was not legal tender—no one had to accept it. Through the redemption process, the markets prevented too many from being issued. By Dale’s definition, it seems to be fiat money because most of it came into being via the purchase of treasury notes. However, gold backed at least 40 percent of the federal reserve notes. This 40 percent was wealth-based money. Was this 40 percent not fiat money? In 1933, Congress ended the redemption of federal reserve notes and made them legal tender. I contend that from this point forward federal reserve notes were true fiat money. Mr. Dale probably agrees. However, with his definition, that all federal reserve notes were fiat money before 1968 is questionable. Gold backed at least 40 percent of the federal reserve notes outstanding until 1945. In 1945 Congress reduced the backing to 25 percent and eliminated it in 1968. As this 40 percent and later 25 percent were wealth-based gold, apparently this money was not fiat money by Dale’s definition.

Like most people, Mr. Dale confuses the markets’ demand for money overall with an individual’s desire for money. If everyone had all the money that he wanted, money would be worthless. Most people want an unlimited supply of money.

He cannot conceive of people melting gold coins to use the gold for other purposes. I explain above why people would melt gold. If gold is more valuable in another product than it is in coins, people will melt coins for use in the higher gold-valued product. If people seek to maximize their wealth, as Mr. Dale suggests, why would they not melt coins? If the value of gold in some non-coin form never exceeded the value of gold in coin form, nearly all gold would be coined. As that has never happened, gold must have a great deal of value outside coins.

Mr. Dale contends that federal reserve notes being legal tender is a nonissue because the U.S. Supreme Court and others do not accept federal reserve notes and require checks. He states that checkbook money is not legal tender, which is true. The reason that these agencies refuse federal reserve notes and require checks is that they do not trust their employees. On the other hand, the Post Office requires federal reserve notes and refuse checks for money orders. (Unless a change has been made in the past two years, no State agency in North Carolina can write a rule that precludes payment in federal reserve notes. The Department of Revenue may be an exception as many of its rules are not subject to normal rulemaking.)

Legal tender laws usually do not require a person to sell his goods or services for federal reserve notes. He can sell them in whatever currency that he wants. However, if he sells on credit, the legal tender laws require him to accept payment in federal reserve notes if the debtor so choice to pay with federal reserve notes.

Stripping the federal reserve dollar of its legal tender status is important in returning to the gold standard. If the federal reserve dollar remains legal tender, the debtor could pay a debt contracted in gold with federal reserve notes.

Under my discussion of the real bills doctrine, I write that the bill of exchange allows the retailer time to get the money that he will use to pay for the merchandise from the buyers of that merchandise. Mr. Dale remarks, "If there was enough money in the system the retailer would have the money to pay for the goods." Where does the retailer get the money for his initial stock? Mr. Dale does not say. Presumably, he would have to save enough money to buy his initial stock. (Mr. Dale’s reform is designed to discourage savings.) Thus, he would have to borrow the money from himself, a bank, or someone else to pay for his initial stock. (Mr. Dale does not like people borrowing.) Mr. Dale suggests that the retailer should be buying his next stock from the money earned from selling his current stock. Is it not more economical to pay for the current stock from the selling of the current stock and for the next stock from the selling the next stock? It does eliminate the need to borrow either from oneself or from a bank. Mr. Dale should like that.

At the point of repeating myself again, Mr. Dale is totally confused about the real bills doctrine. His confusion is never more evident than his comment on the simple example that I give about the real bills doctrine.

He sees a long line of lending where no lending is occurring. A real bill of exchange is not a lending instrument. It is a clearing instrument No one is lending. No one is borrowing. Producers and wholesalers are giving the retailer time to sell the final product to the final consumer. By doing this, they free capital for other uses instead of tying it up in stock.

Perhaps Mr. Dale is confusing the real bills doctrine with the current system. The producer, wholesaler, and retailer are dependent on bank loans to operate. The real bills doctrine frees them from this dependency on bank loans. It allows them to operate without banks and loans. Again, Mr. Dale should like this.

Mr. Dale asks where an investor or bank gets the money to buy a real bill and what kind of money is it and how did it get into circulation. Under the system that I am advocating, the investor gets his money from savings. I have already explained how metallic money and commercial money and the bank money into which commercial money is converted get into circulation. (I am not sure where they would get the money under Mr. Dale’s reform as it discourages savings. However, real bills would not exist under Mr. Dale’s reform as all his money is someone’s obligation.)

Mr. Dale asserts that all checkbook money is bank-created money. If one deposits a gold coin in his checking account, the bank takes the coin and appears to do something mysterious with it—Mr. Dale does not state what happens to it. The bank just creates checkbook money out of nothing—so Mr. Dale implies. Apparently, the money in the checking account is not a claim against the gold deposited. In reality, the bank puts the gold coin in its vault and credits the depositor’s checking account with the gold deposited. The depositor can then write a check on his account instructing the bank to transfer the gold to another person. Mr. Dale is an intelligent person and should know this.

Mr. Dale continuously harps that a bank creates money when it credits a checking account even when money is deposited in a checking account or when a bank converts one form of money to checkbook money. I suppose that one could construe that a bank creates money when it converts money from one form to another. When a person deposits a gold coin in his checking account, in a sense the bank does create checkbook money by crediting to the depositor’s checking account. That checkbook money did not exist before. However, that process is more correctly viewed as conversion instead of creation. The new checkbook money enters the money supply, and the deposited gold coin is removed. When a check is deposited redeeming the gold coin, the gold reenters the money supply and the checkbook money leaves it. No change has occurred in the money supply.

Likewise with real bills, a bank removes it from the money supply when it "creates" checkbook money, crediting the checking account of the seller of the bill, to buy the bill. The bank has not increased the money supply. It has removed the bill, which is money in its own right, from the money supply to offset the checkbook money added. Within 90 days that checkbook money, or an equivalent amount checkbook money and bank notes, is permanently removed from the money supply when it pays the real bill. When paid, the real bill is also retired permanently and removed from the money supply as the goods that it represents have been sold.

These processes differ from the current bank lending process. Currently, banks often create new money as checkbook money when it lends. Mr. Dale, does a bank create money when it lends savings deposits? When the Federal Reserve buys treasury bills, it creates checkbook money, that is, it credits a checking account with the price of the treasury bills. It can do this directly or indirectly through local banks by crediting that bank’s reserves. This is not a conversion process because treasury bills were not and are not money. The Federal Reserve is actually adding new money to the economy without offsetting it by removing an equivalent amount of existing money.
I note that "the real bills doctrine generates the money necessary to buy newly produced goods and retires that money when the goods are sold." Mr. Dale responses, "If there was enough gold money there would be no need for the real bills doctrine." Apparently, my lack of clarity again appears. I never claim that there is enough gold without the real bills doctrine for the economy to function efficiently. (It can function, but not efficiently.) Furthermore, I know that Mr. Dale is obsessed with his loathing of charging interest. Commercially created money (real bills) does not involve interest. To repeat myself, the discount rate for a real bill is not an interest rate.

To explain adequately everything to Mr. Dale, I guess that I needed to write another 30 pages or more. Even then, I could not anticipate all his points of confusion. Furthermore, I doubt that I could convince Mr. Dale that the discount rate is not an interest rate and a real bill is not a loan. No matter how articulately I or anyone else expresses this truth, I doubt that Mr. Dale will ever accept it.

Mr. Dale claims that my statement "with their production, the people create money" could "only be true if everyone bartered." I have already described about how people create money under the real bills doctrine. I will not repeat that here. Barter is not necessary. To my statement that "with their consumption, they destroy money," He remarks, "I didn’t know that eggs, bananas, meat, bread, wine, houses and clothes etc. were money." Where did I say that they were money? True, people consume these products. However, they buy them with gold coins, bank notes, or checkbook money. The seller uses these moneys to pay his bill. Payment of the bill retires (destroys) it. If the owner of the bill receives bank notes or checks in payment, he sends them to the bank of origin for gold. The bank of origin removes (debits) gold from the account on which the check is drawn—thus, destroying that checkbook money. It retires (destroys) the bank notes received and redeemed. Thus, "with their consumption, they destroy money."

Mr. Dale asks why gold is needed with the real bills doctrine. The real bills doctrine cannot work without gold (or another commodity functioning as money, such as silver). Real bills must always mature into specie, i.e., gold in our present discussion. Being a future good or obligation, real bills can only mature into a present good that is no one’s obligation, such as gold. (As fiat money is a future obligation, including Mr. Dale’s fiat money, real bills become nonfunctional under fiat monetary systems.) Moreover, gold functions as the governor or regulator for the whole system. If real bills overestimate or underestimate the value of new goods being offered for sale, gold notifies sellers, bankers, and others that errors are occurring and corrective action is needed. It also prevents inventory speculation, which is discussed below. Moreover, gold is also needed for things that do not qualify to be covered by a real bill of exchange, e.g., things that typically take more than 90 days from production to final consumer, such as houses and factories.

Mr. Dale continuously insists that bankers are earning "all that ‘nice’ interest as profit for not really producing any thing" in connection to real bills. Must I repeatedly rebut that real bills pay no interest? Its discount rate is not an interest rate. I explain this above.

Furthermore, real bills are not loans. They are claims to future money and evidence of credit transactions. They are clearing instruments and not lending instruments. I explain this above.

I state, "Banks merely convert it from one form (real bills or commercial money) to another (bank notes and checkable deposits)." Mr. Dale remarks, "Then why don’t we all just write our own real bills and go deposit in our checking accounts." He has got to be kidding. Is this a serious question? I give the obvious answer: Most of us are not doing anything that would qualify for a real bill of exchange. So, if we wrote one, we would need a coconspirator or some ignorant buffoon to accept (sign) it, or we would have to forge a signature of acceptance. If we then tried to unload it on a bank or someone else, we would be guilty of fraud. I am sure that Mr. Dale knows this.

Nelson Hultberg describes real bills as "temporary bills of exchange that appear simultaneously with goods that are being produced to aid such goods in further transportation along the production/consumption chain. These bills of exchange then go out of existence once the goods have cleared the markets."[8]

Most of us are not directly involved in the production of consumer goods expected to be completely sold within 90 days. Therefore, most of us cannot write real bills of exchange. Mr. Dale, I am beginning to believe that you "must not live in the same world as the rest of us."
Mr. Dale continuously harps on real bills being loans. As I explained above, they are not loans. No one is borrowing. No one is lending. Furthermore, no one pays interest on a real bill. The discount is not interest. If the retailer pays the supplier on delivery instead of 90 days later, he receives the discount. He pays less if he pays at the time of delivery than he would pay if he pays 90 days later. Does that mean he has collected interest from the supplier? Mr. Dale seems to think so.

About the real bills doctrine, Mr. Dale claims that it is "based on the theory that gold was the only real money, money that neither the farmers, nor the businessmen, nor the bankers had." Why would no farmer, businessman, or bank have any gold? That any of them would have been in business without at least at some time possessing gold is incredulous.

He also states, "The real bills doctrine was where the banks could finance industry based on commercial paper guarantees." This is not exactly correct. Not all commercial paper is acceptable for discounting under the real bills doctrine. The only commercial paper eligible for discounting under the real bills doctrine is a real bill of exchange or a promissary note that is functionally the same as a real bill of exchange. Other commercial papers, such as bills of acceptance and bills of accommodation, are really lending and not clearing instruments. A bank may say that it is discounting them, but it is really lending and charging interest.

Mr. Dale is correct when he states that government bonds and broker loans are ineligible. However, he claims that inventory speculation is acceptable under the real bills doctrine. It is not. A function of gold under the real bills doctrine is to prevent inventory speculation. Bank notes and checkbook money created for inventory speculation result in bank notes and checkbook money exceeding the demand for money to buy new goods. The excessive credit money would be redeemed for gold. As people redeem the excess bank money for gold, the bank risks not having enough gold in its vaults to honor these claims (its credit money). If it fails to redeem all its bank money presented for redemption, the government should send the banker to prison for fraud. If the government would imprison every banker who failed to redeem his notes and checks drawn on his bank’s accounts (assuming the account is credited for more than the check), bankers would be strongly discouraged from discounting (buying) any bills based on inventory speculation.

In my demonstration showing that enough gold exists, Mr. Dale complains about my expressing gold in dollars. To make the necessary comparisons, I needed to convert everything to a common unit. I could have converted everything to euros or ounces. I chose dollars because most Americans think about money in terms of dollars.

Mr. Dale must have been "grasping at straws" at this point to find faults with my paper. Apparently, he would have understood the comparison better if I compared gold in ounces to trade volume in dollars.

Toward the end of the paper, Mr. Dale describes the real bills doctrine. His description assumes a central bank like the Federal Reserve. Some of the problems that he associates with the real bills doctrine can occur with a centralized banking system. Although I did not discuss the banking system in my original article as it was beyond the scope of the article, I argue against centralized banking and in favor of decentralized banking in my book Reconstruction of America’s Monetary and Banking System. My first recommendation in reconstructing America’s monetary system is to abolish the Federal Reserve.

Mr. Dale claims that "in the 1792 coinage act the dollar was value in wealth owned, a weight, 24.75 grains of pure gold." This is incorrect. Congress defined the dollar as 371.25 grains of silver (.995 fine) or 416 grains of standard silver (0.892 fine). Thus, Congress defined the dollar as a certain weight of silver, which Mr. Dale acknowledges in another comment, and not gold. (It did not fix the price of silver.) "As for gold, Congress adopted the ‘eagle’ and defined it as equal to ten silver dollars. One eagle contained 247.5 grains of pure gold and was equal in value to 3712.5 grains of pure silver. Thus, in terms of gold, one silver dollar equaled 24.75 grains of pure gold, 27.00 grains of standard gold (0.91667 fine). . . ."[9]

When I state that "when accompanied by the real bills doctrine this amount of gold could accommodate more that $425 trillion in trade quarterly or more than $1.7 quadrillion annually," Mr. Dale claims that I am fractionalizing gold. I am not. Under the real bills doctrine with sound decentralized banking, fractional reserve banking does not exist. Specie or commercial money backs all credit money (bank notes and checkbook money) that a bank "creates" (more correctly, converts). The specie and commercial money remains out of circulation. No one has use of it while the bank money representing that specie or commercial money is in circulation or available for use. Thus, if all bank notes and demand deposits (checkbook money) are fully backed by specie (gold and silver) or commercial money (real bills) maturing into specie, fractional reserve banking as such does not exists. I know that Mr. Dale will never understand that this is not fractional reserve banking. For my inability to explain this concept adequately and clearly, I apologize to him.

Mr. Dale writes, "Before one can have gold or silver stamped into coined money one must have the gold and silver, which seems to be something very hard for most people to get their hands on." If Mr. Dale or anyone else who finds it hard to obtain gold and especially silver, he has not bothered to find any. Gold and silver are easily found without hardly looking—try eBay for a starter. Hundreds if not thousands of money changers exist around the country to change federal reserve dollars into gold and silver. Anyone who can acquire federal reserve notes can acquire silver. One can convert a $20 federal reserve note (less than the cost of a meal for two at a moderately priced restaurant) into one ounce of silver and receive change back. If one observes his change, he may occasionally find a silver dime or quarter. Anyone who earns an average wage can easily save enough to obtain gold if he really wants the gold.

I point out that Gresham’s law explains why one does not see people paying their debts with gold and silver. I noted that people are not going to pay a $1000 debt with 20 $50 gold eagles (20 ounces of gold) or 1000 $1 silver liberty dollars (1000 ounces of silver). Mr. Dale remarks, "If all the things he mentioned above where legal tender and the legal tender law were enforced, all those things would have the same purchasing power." Congress has made all them legal tender. As the debtor chooses the legal tender with which to pay his debts, he will choose the cheapest (lowest quality) one, which is the federal reserve note. (Considering Mr. Dale’s predilection for paper money, he probably would use gold or silver coins, if he could find any, for payment and save his paper money.)

They may all have the same debt paying power although the IRS disputes that. The IRS contends that when a person’s wages are paid with gold eagles, for example, for tax purposes the wage is computed based on the value of the coin’s metal content in terms of the federal reserve notes. It is not computed based on the legal tender value stamped on the coin.

Mr. Dale fails to realize that Gresham’s law trumps legal tender laws when high quality money like gold and low quality money like irredeemable federal reserve notes are both legal tenders. People will spend the low quality money and save the high quality money.

Mr. Dale asserts, "The myth is that there ever [sic, I assume he means never] was enough gold for a good general medium-of-change." If there has never been enough gold, why have people chosen it for money when left free from governmental coercion? People have never voluntarily chosen irredeemable paper money, even the paper money promoted by Mr. Dale, as their money without governmental coercion. Perhaps Mr. Dale can provide an example if I am wrong.

Mr. Dale writes, "The United States Constitution did not declare what was to be or what was not to be dollars." The Constitution does not define year or mile, either, but it uses year and mile as a unit measure—just like it uses dollar as a unit of measure. Mr. Dale must believe that the writers of the Constitution did not have a clue about what they meant by "dollar." They were going the leave its definition to the whim of Congress. Congress could define the dollar on a whim and could change that definition at anytime on a whim. He also must believe that the people as States adopted a constitution that allowed Congress to levy a duty up to $10 per slave imported without knowing what a dollar was. Without this knowledge, they would not know what this tax would be. Would they have approved the Constitution not knowing what a dollar was or would be? Would they have approved the Constitution if Congress could declare the dollar to be anything that it wanted it to be? If so, for all they knew, Congress would define the dollar as a slave. Thus, the importer of slaves would pay the U.S. government up to ten slaves for each slave imported. Does Mr. Dale really believe this? He does if he believes that the definition of the dollar was left to the whim of Congress. (Mr. Dale must maintain that the definition of "dollar" is left to the whim of Congress to justify the constitutionality of the dollar that he proposes in his monetary reform.)

If Mr. Dale is consistent, he must also believe that the definition of "year" and "mile" is left to the whim of Congress. Congress could lawfully change the definition of "year" from one rotation around the sun to 100 rotations and give themselves lifetime tenure. A two-year term would thus last for 200 rotations around the sun. It could lawfully change the definition of "mile"such that the ten-miles-square district over which it is given exclusive legislation covers the whole country.

Contrary to Mr. Dale’s assertion, people knew what a dollar was. Lawfully, Congress can no more change that definition than it can change the definition of year or mile. The definition of "dollar" was not left to the whim of Congress. Everyone knew that the dollar meant the weight of silver in the Spanish milled dollar. Under the Articles of Confederation, Congress had defined the dollar as the weight of silver in the Spanish milled dollar. It adopted that standard because the Spanish milled dollar was customarily used in commerce and business.

Mr. Dale faults my article for my failure to discuss banking. Such a discussion was beyond the scope of my article. If he wants to read my discussion of banking and how it needs to be reconstructed, he should buy my book, Reconstruction of America’s Monetary and Banking System, and read the 80 pages on banking.

I write, "The founding fathers never intended that the U.S. government should issue any kind of paper money. The Constitutional Convention discussed that issue and the Convention rejected granting the U.S. government the authority to print or issue paper money." Mr. Dale responds, "The Constitutional Convention discussed not using bills of credit." Members of the convention used "bills of credit" and "paper money" interchangeably. They were synonymous. James Madison wrote, "Striking out the words [‘to emit bills on the credit of the United States’] cut off the pretext for a paper currency, and particularly for making the bills a tender either for public or private debts."[10] Oliver Ellsworth, who was also a member of the Constitutional Convention and later chief justice of the Supreme Court, concurred with Madison, "This is a favorable moment to shut and bar the door against paper money."[11]

Mr. Dale claims that "the first thing that the founding fathers did under the direction of Alexander Hamilton . . . [was to] set up a bank and issued bills of credit." The United States Bank was a private corporation chartered by Congress. It was not part of the U.S. government. Like all other banks, it could issue bank notes or, as Mr. Dale calls them, bills of credit. As such, it did not violate the constitutional prohibition against Congress issuing bills of credit. (One could construe that chartering the bank was a way to sneak around this prohibition.) I agree with Jefferson that Congress has no authority to charter a bank. Therefore, the United States Bank, like the current Federal Reserve, was unlawful, and its establishment was unconstitutional.

In conclusion, Mr. Dale habitually confuses the monetary system of the gold and silver standard accompanied by the real bills doctrine (commercial paper principle) that I propose with the current monetary system. He seems unable to think outside the parameters of the current monetary system. Because he cannot free himself from the parameters of the current debt-based fiat monetary system does not mean that others cannot. (He wants to maintain a debt-based fiat monetary system.)

In closing, I offer a comment by Professor Walter E. Spahr, Chairman of the Department of Economics at New York University from 1927 to 1956, "What is the meaning of a gold standard and a redeemable currency? It represents integrity. It insures the people’s control over the government’s use of the public purse. It is the best guarantee against the socialization of a nation. It enables a people to keep the government and banks in check. It prevents currency expansion from getting ever farther out of bounds until it becomes worthless. It tends to force standards of honesty on government and bank officials. It is the symbol of a free society and an honourable government. It is a necessary prerequisite to economic health. It is the first economic bulwark of free men."[12]

Endnotes

1. Byron Dale, Bashed by the Bankers (Pro-American Educational Foundation, 1988), p. 51.
2. Byron Dale, "Analysis of Thomas Allen’s There is enough Gold," http://www.chrismartenson.com/ print/25550, Aug. 21, 2009. All quoted material whose source is not noted is from this source.
3. Thomas Coley Allen, Reconstruction of America’s Monetary and Banking System: A Return to Constitutional Money (Franklinton: TC Allen Co., 2009), p.130.
4. Charles Rist, History of Monetary and Credit Theory from John Law to the Present Day, translator Jane Degras (1940, reprint; New York: Augustus M. Kelly, 1966), p. 35.
5. Antal E. Fekete, "Monetary Economics 101: The Real Bills Doctrine of Adam Smith," Lecture 6, Aug.5, 2002, http//www.shoemakerconsulting.com/GoldisFreedom/PVFfiles/ lecture101-6pvf.htm, Sept. 12, 2007.
6. Antal E. Fekete, "Monetary Economics 101: The Real Bills Doctrine of Adam Smith," Lecture 12, Oct.6, 2002, http//www.shoemakerconsulting.com/GoldisFreedom/PVFfiles/ lecture101-12pvf.htm, Sept. 12, 2007.
7. Allen, p. 183.
8. Nelson Hultberg, "Cranks in the Gold Community," July 11, 2005, http://www.finacialsense.com/editorials/hultberg/2005/0711.htm, July 12, 2005.
9. Allen, p. 84.
10. George Bancroft, A Plea of the Constitution of the United States, p. 40.
11. Ibid., p. 43.
12. The Gold Standard Institute, Newsletter #3, August 24, 2009, p. 1.

Copyright © 2009 by Thomas Coley Allen. 

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