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In Defence of Germany
By G. E. O. Knight

The Golden Eagle Publishing Co., Fetter House, Fetter Lane, London E.C.4, © 1934
This digitalized version © 2009 by The Scriptorium.

[3]
Preface

It is a pleasure to me to write a few words to the twentieth Edition (20th thousand) of Mr. G. E. O. Knight’s most excellent brochure in its revised form. Mr. Knight has a perfect understanding of the difficulties confronting the new Germany, and, what is equally important, he possesses a fair and independent judgment. We Germans feel grateful to him, and to all our English friends who have taken the trouble, at no little expense and inconvenience to themselves, to study our revolution without prejudice. I hope sincerely that this pamphlet will be read all over England, and that it will help towards a better understanding between Great Britain and Germany.

Baronesse von der Goltz.
Rogzow, über Belgard/Pers,
Pom, Germany.

August 10th, 1934.

[4=blank] [5]
A Personal Note

For some time past, a handful of Englishmen and women, all pro-German, and each anxious to see a better and more intimate understanding between the two countries, have found themselves considerably handicapped in their work of reconciliation by the report of happenings in the German Reich which have gained impetus without any manifestation of disapproval from official German sources. Not that we wish it to be thought that it would redound to the dignity of the German or any other Government to go out of their way to refute statements which on the face of them are manifestly absurd and published to serve political ends. But the hard fact has to be faced that Germany to-day is culturally isolated from the rest of the world. In the main, this is due to the new form of government now found in Germany, obviously a matter that concerns the Germans alone, and no part of our business to discuss. But we do not think that Germany is giving of her best to-day. No doubt this is attributable to the fact that she has been torn by internal strife and the haunting fear that Communism and other subversive forms of government are even yet capable of doing the country infinite harm unless a strong hand is [6] used to keep them in check. Whereas German culture was formerly the admiration and inspiration of every thoughtful man and woman the world over, there has been a serious setback during the last two or three years in her contribution to letters. We think that this is but a passing phase. In the meanwhile, we can but work for the cause of Anglo-German amity, conscious of the fact that with the lifting of the clouds, we shall secure the aims we have in view – Justice for Germany and World Peace.

The Committee of the Friends of Germany.
July 6th, 1934.

[7]
Foreword

Who is behind the present unparalleled anti-German campaign in this country? What are their motives? All the facts point to the existence in the principal cities of Europe and America of a world-wide organisation whose object is to bring discredit on a country which has suffered more during the last twenty years than can ever be recorded. The present orgy of calumny and abuse is pitiful, to use no stronger word. The most sinister aspect of the campaign is the attempt, through the Press of the world, to overthrow the existing European order and tradition and place the Communists in power. How often must it be repeated that there is no alternative to the Hitler regime in Germany but Communism. Once Communism gets control there it will speedily spread its evil influence to every country in Europe. I can scarcely believe there is a responsible Englishman who wishes to see the German Reich fall into the hands of Communists. Every article that appears in the London and Provincial Press to-day against Germany and its Government is a direct incitement to the Communists. If anyone questions the truth of this statement let him read the exulting Communist Press, [8] who boast of having every country on their side in so far as Germany is concerned. The British Press will one day realise the significance of what they are now doing and curse the day they countenanced the anti-German campaign. It is a double-edged weapon full of the gravest consequences, perhaps not so much to England for the time being, but certainly to Germany’s nearest neighbours, destined to become impregnated with the Communist theory of government once it establishes itself in the German Reich.

London, E.C.4. G. E. O. K.
July 5th, 1934.

[9]
In Defence of Germany

1.

If one is to judge from the facts of history, it will be seen that Nations are not for long permitted to run their respective lives and affairs without outside interference. The last twenty years alone suffices to prove the truth of this much under-emphasised fact. Since the Armistice, the various European countries have adopted measures against Germany that aimed at the virtual ruin and degradation of the people and country. It is true that the policies pursued have brought economic havoc to the world at large, and created a situation the end of which is as yet difficult to determine. Just as Germany was blamed before the War for wanting a war, so was she blamed for the War itself. She had grown prosperous, and needed a strong navy to defend her economic and political interests. England watched her every movement as a cat watches a mouse. She saw, or fancied she saw, her markets threatened everywhere. Germany’s growing influence was a continuous source of anxiety to British statesmen and industrialists. A five year anti- [10] German newspaper campaign was inaugurated in London; this led to considerable bitterness and misunderstanding on both sides of the North Sea. The ground, it seems, was slowly being prepared for bigger things; the seeds of hatred and mutual mistrust among them. Parliament did not interfere with the “glorious and hard won liberties of the British Press.” The armaments racket was in full blast; war-mongers reaped no inconsiderable pecuniary gain for their patriotism. “We want eight and we won’t wait,” was the temper of the country in general. No one will ever forget it. The ex-Kaiser was caricatured everywhere and became the laughing-stock of Great Britain. The spy mania was rampant. When the War actually came, it needed little effort on the part of Whitehall to convince the British public that Germany, and Germany alone, was responsible for the outbreak of hostilities. No one but a lunatic thinks so to-day. While some of the more foolish among us are sighing for a return to the status quo ante bellum, others are clamouring for yet another war with Germany for some as yet unspecified act of atrocity she has committed, or will commit if she be permitted to re-arm. At the conclusion of the last war, the European nations had a glorious opportunity of shewing their mettle and vindicating their honour in the matter of disarmament. The question had been before the League of Nations for many years. Con- [11] ference after Conference has been held to no good purpose. The old double game of lying and shuffling so sickened the German Delegation that Germany left the last Conference and the League of Nations convinced that the European nations never had the slightest intention of disarming then or at any other time. Now, of course, Germany is blamed for the failure of the Conference.

2.

A world-wide reorganisation of the political and economic systems of every country seems to be called for. The present cannot for long endure, the edifice is cracking most ominously and will soon be tumbling about our heads. Unless we are very careful, the forces against us will prove too much for statesmen, and not alone Europe, but the world in general, will be engaged in the greatest holocaust yet vouchsafed man to wage. The spectre of Communism stalks every land. The fact that we have no obvious solution to hand for our present overwhelming difficulties is enough to indicate the bankruptcy of Parliament and politicians. A change of heart may go a long way towards solving some of our problems, but will the on-coming tide abate its fury while men are thinking about things? The Germans are still a very great people, possessing an independent will, indomitable energy and courage, [12] with an undying love for their country, a people who, in their dynamics, occupy themselves more with kinetics than statics.

3.

A casual glance at the columns of the Press of this country is disturbing, to say the least. Not a few of the old, wartime stories and their variants are again in evidence, and every conceivable device known to war-mongers in particular and their allies in general is being used to stir up the worst passions in the least intelligent portion of the population – men and women who have no opportunity, time, inclination or even money to combat anything that is being circulated. To find a parallel to the present newspaper talk, one has to go back to the years preceding the outbreak of hostilities in 1914. For long the yellow Press of Great Britain was conducting a newspaper campaign against Germany, clamouring for more battleships, more guns, and a bigger army, aye, even for conscription, to meet the “expansionist” policy of Imperial Germany.

There is scarcely a newspaper or review in this country that will open its columns to the realities of the German situation; indeed, anything that is favourable to the Hitler regime is turned down with the deepest scorn, while the contributor himself is roundly accused, or silently suspected of being in the pay of the Reich.

[13]
4.

The British Press is virtually unanimous in agreeing that our erstwhile enemies are out for revenge, that the members of the Nazi Government are thugs, thieves, liars and even murderers; that nothing good can ever come out of the German Government; that it would be better to march into the country now and crush the Nazis rather than wait until they have re-armed. Almost every item of news is falsified and exaggerated to meet the exigencies of a lying campaign.

5.

Politics are at the root of the evil. The ex-Allies and Associated Powers are naturally anxious to save their faces for the failure to carry out their part of the Treaty of Versailles. What better excuse for their not so doing than that Germany is re-arming? Germany, they tacitly argue, must not be allowed to rise from her ashes, or if she does, it must not be under the leadership of demagogues.

The principal Labour organ of London sees in the German “dictatorship” an attack on the “freedom” enjoyed by British “wageslaves” of this country. It damns every form of tyranny save that exercised by the Trades Union Congress. It hates the British Communists and expels them from membership of the National [14] Labour Party, but a German Communist is a brother, and his arrest and incarceration in a Concentration Camp a crime against civilisation! The Jews of Germany, no matter whether they be leaders of the German Communist Party or men engaged in “big business,” must on no account be touched by the brutal Nazis!

6.

Before the revolution of March 1933, the Jews in the Reich overran many Government Departments, and enjoyed the highest privileges in every profession and calling. They were the principal organisers of the German Communist Party, and became identified with every one of the warring political sects in the country. In every way they proved themselves eminently capable business men and politicians. Many had grown very wealthy. Nearly every German war profiteer was a Jew; the native German seems to have regarded with feelings of shame and horror the idea of making money out of his country during times of great distress. It is not denied that the Jews are clever and amiable people, that they have contributed very materially to science, literature, art and music. That one per cent of the population of Germany should impose their rule and culture – however eminent that culture may be – on seventy million native-born Germans is un- [15] thinkable, to use no stronger word. Modern Germany will not have it. It is obviously inimicable to the best interests of the country, and if the reader objects, then he must ask himself whether a Government of Jews in the House of Commons would be tolerated in this country, and if so, for how long. So when the Nazi worm turned, and the services of many Jews were dispensed with, Jewry throughout the world rose in arms and through the medium of the Press and public meetings in London and the provinces, denounced the German Government in violent terms.

The Germans have assumed control of their country, and for weal or woe they mean to maintain their position. The German people are perfectly entitled to possess what form of government they please; it ill becomes us to dictate to them.

7.

The time is drawing nigh when the position of foreign correspondents should be dispassionately reviewed by the Foreign Offices of all countries. Some sort of understanding or convention is necessary. It is notorious that foreign correspondents are not above abusing their privileges. The temptation to exaggerate the truth; the restrictions put upon them by representatives of their own countries, the harm done by news-editors who insist upon [16] “frightfulness,” and not faithfulness in telegraphic reports, are matters that need investigation. I would feel disposed to make it a legal offence for any foreign correspondent to send false or exaggerated accounts of happenings when his sole object is to do harm to that country because his own Government is pursuing a policy calculated to bring discredit upon it for political purposes.

The British Foreign Office is well aware that not a few men attached to newspapers in foreign countries are employed for purposes of espionage. In the course of my wanderings round the European capitals I have met newspaper men who openly boasted of having been employed in this and that country’s secret service, who have accepted the hospitality of people whom they later on wantonly betrayed. That, you will argue, is all part of the business. But it seems to me a pity that foreign correspondents should not be above suspicion and devote themselves to their specific jobs and to their specific jobs alone.

8.

Recent happenings in Germany have not redounded to the prestige and interests of British foreign correspondents accredited to that country, and although Fleet Street has obscured the real issue, it is felt everywhere that irreparable damage has been done the call- [17] ing of a foreign correspondent by men whose sense of duty has been obscured by their insensate quest for sensation, wilful lying, and even espionage. If men want to pursue the role of a spy, it would be better and more honourable for them and their country if they carried on their work without camouflaging themselves as foreign correspondents. The British Government do not offer protection to the professional spy, although he is in the service of the State. He knows the conditions attached to his office and takes all risks. Columns of the most pathetic sob-stuff were recently printed and published in a well-known London morning daily when its Berlin correspondent was bundled out of Germany, lock, stock and barrel. Questions were asked in the House of Commons about the ” indignity and outrage,” and Sir John Simon was pretty hard put to it when called upon to reply. The Foreign Minister, of course, did his best for the deported man, but he also had Germany to consider – and satisfy.

9.

British foreign correspondents at present in Germany have been placed in an invidious position, and there are few among us to-day who envy them their job, or who would like to accept it, were it offered. Never was the status of a British foreign correspondent in Germany [18] lower than it is to-day, and it will be many years, I fear, before the stigma attached to the profession is removed. If the innocent suffer with the guilty the fault lies with the employers of men quite unsuited to their posts. It is of international importance that only the very best and most trustworthy men shall be employed as foreign correspondents of newspapers.

10.

International Jewry, at the moment, would seem to be destroying the best in British journalism, and that in a cause which is both worthless and futile. If British journalism is to sink to the level of the gutter, the fault will certainly be found at the door of the Jews.

11.

Convinced that the Press of this country was conducting a political campaign against Germany, I resolved to go to Berlin and make free and independent investigations on the spot. I was determined to do pretty much as I pleased when I got there, and no one interfered with my movements. I found Germany, comparatively speaking, a free country, much freer than some of its neighbours. My own views were not always acceptable to my friends, among whom I can count Jews and Gentiles, Nazis and Com- [19] munists, Democrats and Socialists. I discovered that being a Nazi does not preclude one holding views that few Labour men of my own country would express to their “comrades ” of the National Labour Party! Young Germany is keenly interested in social and political questions; I wish to goodness the British working man showed the same interest and intelligence in matters that pertain to his welfare. My visits to the Concentration Camps were full of interest, and recalled the days of my own internment in the Dual Monarchy during the War. Consequently I felt I could regard myself as something of an authority on Concentration Camps in general. I was up to all the tricks of the Camp Commanders at Sonnenberg and Oranienburg, where I made free and personal contact with many of the prisoners, without any interference from the Camp Commanders or their assistants. Indeed, I let it be known to the responsible authorities that unless I was privileged to do as I liked within reason, I would not accept the invitation extended to me to visit the Camps. I was also much struck by the many Workers’ Lagers I visited, and the splendid efforts now being made by the German Government towards ameliorating the lot of the unemployed. I saw no murders of Jews or assaults upon their persons. Order and cleanliness were everywhere. Courtesy and kindness from all and sundry favoured me wherever I went. My private [20] conversations with Jews were illuminating. They did not bear out what the British newspapers suggested. Mountains had been made out of molehills, melodrama out of comic opera. The majority of the “assaults” were committed by over-zealous youths, and in nearly every instance they consisted of “ratting” unfortunate men who were not particularly respectful towards the new regime. Physical harm very little, mental, perhaps much. The laws relating to the freedom of movement of Jews are substantially the same as those of other people. Much of the trouble that has arisen has nothing to do with the domiciled German Jew, many of whom are still employed by the Government in various spheres of usefulness. There are about 80,000 undesirable Jews that Germany wants to get rid of for all time, and willingly would she deport them all to Great Britain or the United States of America if the request were made. These are the Jews who since the Armistice have penetrated the country and created a situation that has wrought considerable social and political harm in Germany. Among these undesirables are murderers, ex-convicts, potential thieves, fraudulent bankrupts, white slave traffickers, beggars of every description that beggar description, and political refugees. Many have come from the Baltic States, others from Poland, and not an inconsiderable number from Russia.

[21] The Jewish question in Germany, as indeed elsewhere, will naturally be settled sooner or later. The best possible solution to the present impasse is to treat all Jews as aliens, as indeed they are in tradition, race and culture, and to extend to them the same privileges, courtesy and consideration as those granted to all foreigners.

12.

The Press of the world, speaking generally, has made no attempt to interpret the views of the German Government on the Jewish or any other question. The campaign of “assaults” had the effect of keeping thousands of tourists out of the country, and there was scarcely an hotel or pension in Berlin last summer that was not empty. The handful of British and American subjects who had been roughly treated by some Nazi youths in mistake for their own countrymen for not giving the Nazi salute was made the occasion for diplomatic protests, but not a word was printed here of the apologies offered by the German Foreign Office; one looked in vain for any such generous gesture from Fleet Street.

Things have cooled off a bit since I left Germany insofar as the Jewish question is concerned. The British public, ever slow to understand the truth, is now asking nasty questions. Was it all true? Who was behind the [22] “atrocity” stories? Is the British Press controlled by Jews? In whose hands lies the power of Fleet Street? Was the propaganda campaign a smoke screen to cover up the failures of the Disarmament Conference? Did the Jewish armament interests of Great Britain see an opportunity of scaring the public into believing that unarmed Germany was preparing for a war of revenge? Should the public be permitted to know that Germany is the only country that has honoured the Treaty of Versailles?

13.

Of Herr Hitler’s peace policy I cull the following from an address given by the Reich Chancellor on October 14th, 1933, and which speaks for itself: –

I speak in the name of the entire German nation when I say that all of us most sincerely desire to root out an enmity whose sacrifices are out of all proportion to any possible gain.

“The German people are convinced that their honour has remained pure and unstained upon a thousand battlefields, just as they see in the French soldier only their ancient but glorious opponent. We, and the whole German nation, should all be happy at the thought that we could spare our children and our children’s children what we ourselves as honourable men have had to watch in the long and bitter years and have, [23] ourselves, had to suffer. The history of the last hundred and fifty years, with all its various changes and chances, should have taught both at least one lesson; that important and permanent changes can no longer be purchased by a sacrifice of blood. I, as a National-Socialist, and all my followers, absolutely refuse, however, by reason of our national principles, to acquire, at the cost of the life-blood of those who love and are dear to us, men and women of a foreign nation, who, in any case, will never love us. It would be a day of untold blessing for the whole of humanity if the two nations could once and for all banish the idea of force from their mutual relationships; the German nation is prepared to do this.

“While boldly asserting the rights which the treaties themselves give us, I will, however, declare equally boldly that in future there will be for Germany no more territory conflicts between the two countries.

After the return of the Saar Basin to the Reich it would be insanity to think of a war between the two States. For such a war there could no longer be, from our point of view, any reasonable or moral excuse.

For nobody could demand that millions of young lives should be destroyed in order to correct the present frontiers. Such a correction would be of problematical extent and even more problematical worth.”

Continuing his address, Herr Hitler said:
[24]

“Earlier German Governments trustfully joined the League of Nations in the hope that it would prove to be a forum for a fair adjustment of national interests, but, above all, for honest reconciliation between former opponents. But the prerequisite for this was the recognition of the final restoration of the equality of rights of the German nation. The German nation took part in the Disarmament Conference on the same condition. To be disqualified to the rank of a member without equal rights of such an institution or conference is an unbearable humiliation for a nation of sixty-five millions with a sense of honour, and for a Government with an equally strong sense of honour.

The German nation has more than fulfilled its obligations with regard to disarmament. It is now the turn of the highly-armed States to fulfil similar obligations to no less extent. The German Government does not take part in this Conference in order to haggle for a few guns or machine guns for the German nation, but to co-operate as a factor with equal rights in the general appeasement of the world. Germany has no less right to security than other nations. If the English Minister, Mr. Baldwin, represents it as obvious that, for England, disarmament can be understood only as the disarmament of the more highly-armed States simultaneously with an increase of England’s armaments up to a common level, then it would be [25] unfair to overwhelm Germany with reproaches if, as a member of the Conference with equal rights, she maintains the same view in her own case. Germany’s demand in this respect cannot constitute any menace to the other Powers. For the defensive works of other nations are constructed to withstand the most powerful offensive weapons, while Germany does not demand any offensive weapons but only those defensive weapons which are not forbidden even in future but sanctioned for all nations. And in this case, too, Germany is ready from the start to be satisfied quantitatively with a minimum which is out of all proportion to the gigantic stocks of offensive and defensive weapons of our former opponents. The intentional disqualification of our nation, however, contained in the fact that an obvious right is granted to every nation in the world and denied only to us, is felt by us to be the perpetuation of a discrimination that is intolerable for us. I already stated in my peace speech in May that under such conditions we should, to our regret, no longer be in a position to belong to the League of Nations or to take part in international conferences.”

14.

If I were asked what is uppermost in the minds of the average man and woman in Germany to-day, I would unhesitatingly answer – [26] the fear of invasion. What have Germany’s neighbours done to dispel this fear complex? An unarmed Germany is an anachronism and the greatest danger to the peace of Europe.

15.

There were some seven thousand political prisoners interned in the whole of Germany in August, 1933. Of this number, about seven hundred were Communists interned in Oranienburg. The site of this camp is that of a disused brewery; there is no question of the place being large enough for the men and their one hundred guards. Not more than one hundred of the seven hundred internees belonged to the intelligentsia class. The remainder were workers, not a few of whom were mentally deficient. Some had already served terms of imprisonment for offences other than political, among whom Jews predominated. The discipline in the camp was of the robust kind. Every man had some kind of work to do, but this was not always enforced. The camp rose at 6 a.m. and all lights were out at 9.30 p.m. The meals consisted of breakfast, dinner, supper with meat served daily except on Fridays. There was a dispensary attached to the camp and a German doctor was in charge. Severe cases of illness were sent to the local hospital. On an average, ten men reported themselves daily to the doctor, and it was generally found that of [27] this number only two or three needed treatment. Various trades were carried on within the camp, such as carpentry, tailoring and shoe-making. Part of the camp was set off for bathing. Shower baths and facilities for sun bathing were shown me. There was also a splendid sports ground. The sleeping apartments consisted of wooden beds and straw mattresses, with three blankets for each prisoner. The working hours were from 7 a.m. to 11.30 a.m., and from 1 p.m. to 6 p.m. A library was in course of being introduced. Visitors were allowed once a week, and were received in the dining room which accommodated some three hundred people. There were apartments set apart for music and dramatic performances. In addition to receiving free board and lodging, each of the prisoners was drawing Rm.10 to Rm.12 per week, which represented his unemployment allowance pay. Instruction in ethics, religion, the new form of Government in Germany, history, languages were given daily to those who desired to attend. There was little or no crime among the men in the camp. Good order prevailed among all classes. The guards ate the same food as the prisoners, and were subject to the same discipline as the internees, although they were Government officials. One of the guards was a Prince of the House of Hesse! Letters and parcels were subject to censorship. In not one case out of many thousands received had it been found necessary to [28] destroy any parcel or letter forwarded. Newspapers were permitted and smoking allowed. When a prisoner desired to light his pipe or cigarette, he had to go to a guard detailed off to supply lights for the prisoners, as no matches were permitted prisoners. Services were held every Sunday, and the majority of the prisoners availed themselves of the opportunity. No objection was raised by the authorities to me taking photographs of both camp and internees. The men looked in splendid physical condition. Having heard so many dreadful stories of brutal treatment being meted out to the Communists in this particular camp, I asked some of the men to confide in me and tell me the truth of these allegations. Not a few laughed “at the bloody capitalist liars of your country!” I took fifteen men at random and asked them to strip in my presence. I wanted to see if they bore any marks of violence about their persons. I saw nothing indicative of bad treatment. When I asked if I could help any of the prisoners in any possible way, a young Communist stepped forward and in pathetic tones enquired if England could now send raw materials to Germany to get work started once again in the Fatherland!

16.

It is not necessary for me to give any details of my visit to the Concentration Camp at Son- [29] nenberg, for exactly the same conditions prevailed there as at Oranienburg.

17.

Stories of starvation of prisoners in German Concentration Camps having been circulated throughout the world, I append herewith the diet of prisoners since the date of their internment. Both at Oranienburg and Sonnenberg I took occasion to make enquiries into the starvation reports, and found them lacking in truth. Save for the loss of personal liberty, no complaints were forthcoming, in spite of the fact that every opportunity was given the men to speak to me privately and without fear of being overheard by officials. Here is the daily prison menage: 1,000 grammes of bread, 500 grammes of potatoes, meat, except on Fridays, soup (Sauerkraut), tea or coffee, vegetables (cabbage or potatoes), fish (Fridays). Those on the sick list are dieted in accordance with the orders of the resident doctor. [For our readers not familiar with the metric system, Scriptorium notes: 1,000 grammes = 1 kilogram = 2.2 pounds, 500 grammes = just over 1 pound.]

18.

The Workers’ Lagers are wonderful examples of what a Government can do for the unemployed. These are voluntary institutions run solely by the German Government, and the camps are scattered all over the country, about 5,000 all told. At the time I left Germany, [30] (August, 1933) there were more than 300,000 men and women working in various spheres of usefulness. At Bernau I was shown over a Lager that contained 276 men, all of whom were engaged in agricultural work. They had converted an old mill into a barracks which were to form the future headquarters of the workers. In addition to free board and lodging, each of the workers received 30 Pfennigs per day. All the men I saw were enjoying excellent health. The discipline, while strict, was not of a military character.

The object of these Workers’ Lagers is to raise the morale of the men who have known years of unemployment. In each camp the worker stays for 40 weeks, and the period will be renewed on application of the worker and with the permission of the Government. Preference is always given to those young men who are really likely to pursue the life of a farmer. What I saw of the Workers’ Lagers in various parts of Germany convinced me that the Government is doing an excellent work and one which the British Government could emulate with advantage to the community.

19.

Everywhere one goes on the Continent one finds mistrust and disillusionment. The fear of invasion is rampant in France. It is common to Germany, Belgium, Poland, Russia; [31] it permeates the Balkan States, it is to be found as far afield as the Americas. No nation seems capable of ridding itself of this fear. It is not a product of Fascism, it is not peculiar to Democracy. It may be a symptom of our mechanical age, the fear of a rival inventing some easy and damnable lethal weapon that will destroy whole populations without reply. The malaise is briefly referred to by newspapers, who, in their turn, fear to let the public know the truth of things political and the possibility of a new war. It is everywhere taken for granted that our pro-French policy is the correct one, that the isolation and encirclement of Germany must be pursued at all costs. We seem to have learned nothing from past experience. France, the hysterical young lady of Europe, wants “security.” So does Germany and England, and Belgium, and Russia, and every nation in the world. Why French “security”? What about British security? Who is going to guarantee the security of Russia, Poland, Czecho-Slovakia, Tibet, etc.?

20.

It has become patent to the meanest intelligence that if the whole world were to support France and grant her all she demands in the way of security, that country would still insist on arms and ammunition in the last resort. France is well aware that she cannot now rely [32] upon the promises of nations to support her in her eagerness to keep intact the Treaty of Versailles. The security cry does not deceive the meanest intelligence. It is French armament interests that France demands Britain to guarantee. It needs little emphasis to say that France is the most powerful nation in the world just now, and she alone, if she felt so persuaded, could march into Germany at any moment and invoke the Treaty of Versailles for taking possession of every vantage point in the Reich, and England could not plead the Locarno Pact in reply to her action. To-day French ‘planes could lay waste Berlin, Munich, Hamburg, the Ruhr, Hanover and every city in the Reich with scarce a response from the German people. She could dictate her own terms; in a few words, France is so strong militarily that unaided she could crush Germany within twenty-four hours and emerge from her triumphs with no apparent loss to her power as the greatest military force in Europe.

21.

When one begins to realise the manifold forces at work against Germany to-day, with that country insisting upon re-armament if others fail to disarm, one is appalled at the impudence of the claim that Germany will be responsible for a disturbance of the peace. Ever since the Peace treaties, France has pursued a [33] policy which in every respect is identical to that she followed before 1914 – a combination of formidable groups to support her own political ends. Pro-Jewish France has used all her influence to destroy the political and economic aspirations of anti-Jewish Germany. Germany left the League of Nations because that organisation can no longer be regarded as providing machinery for the preservation of peace. Its whole procedure, as events have proved, is too cumbrous and dilatory, it possesses no effective means of exercising its authority.

22.

First and foremost, Germany wants peace and friendship with France in particular and the world in general. The concord she demands of France must be based on goodwill and understanding, there must be a sincere regard for each other’s interests, and an end put to the ancient feuds that have wrought such incalculable mischief in Europe. It was a thousand pities that France rejected the offer of a peace pact made by Germany. The accord with Poland may be the cause of the contemptuous tone of the French reply.

Germany has no need for the League of Nations at the present time, and in no circumstances will she rejoin that organisation until her demands are satisfied. Her abandonment of the League is the consequence of the refusal of equality implied in the attitude of the highly [34] armed powers in the Disarmament question. Germany’s demand for practical equality does not mean that Germany wants heavy tanks, heavy mobile guns, or bombers, or other arms which, according to the stipulations of the proposed Convention, will be abolished in the future. But it does mean that Germany wants at once those arms which, being of a defensive character, will be definitely retained under the Convention, and that she wants these arms from the beginning in quantities sufficient for her security.

It is quite clear that as long as this equality is not granted, international control of arms would be a one-sided affair, directed against Germany alone.

23.

The question is being asked – Why was unarmed Germany invited to sit in consultation with the heavily armed powers? That she consented to do so must prove goodwill and a desire for a common understanding. Germany accepted because she thought she would be able to make her whole weight felt on the side of the Disarmament cause. It will be seen that Germany’s participation made it very difficult for the highly armed powers to get away without some appearance of disarmament. Germany’s reason for refusing to participate further in the deliberations was quite simple – [35] there had been a crisis in the Disarmament Conference in May, 1933. This crisis had been overcome by Germany granting a concession in regard to the reorganisation of the Reichwehr. After that, the Conference unanimously adopted the MacDonald plan as “a basis for the future Disarmament Convention” (June 8th, 1933). This resolution went much farther than the previous resolution, which was adopted soon after the MacDonald plan. During the recess of the Disarmament Conference, secret negotiations took place between the Governments of the highly armed powers in which Germany was not invited to take part. The results of these negotiations were the proposals made by Sir John Simon in his celebrated speech on October 14th, 1933. As is well known, these proposals introduced an entirely new element into the whole of the Disarmament question in the form of a trial period for Germany, and thereby constituted a vital modification of the MacDonald plan which only four months previously had been unanimously adopted by the Conference in all its main features. Faced by these questionable tactics, there was no option for Germany but either to capitulate and re-open negotiations on questions which had already been settled or to leave the Conference altogether in the conviction that such methods of negotiation would never lead to real Disarmament.

Germany left the Disarmament Conference.

[36]
24.

Since all the above was written, events in Germany have greatly increased the political and economic uncertainties of Europe. The encirclement of Germany is almost a fait accompli. The country is now politically, economically, and culturally shut off from the rest of the world. Every conceivable issue has been confused and discussion now rages round not how to prevent Germany re-arming, for rearmament by the Reich is a foregone conclusion and the exercise of a legitimate right, but how more and more to spread the gospel of hate and restore pre-war anti-German alliances. We are back to the bad old days. Since the War, Germany has not been given even a dog’s chance to set her house in order. The gentlemen who made the Treaty of Versailles must now be thinking hard and furiously how best to get Germany out of the mess they themselves have created for that country. It requires little vision to see that nearly all of Germany’s present day troubles arise from the most objectionable clauses of the Treaty, and as a pro-German, I shall never cease shouting this from the house-tops until justice is done the German people. As I understand things at the moment, Germany is faced by the alternatives of standing aloof from the rest of the world if she can, and working out her own destiny by the strength of her own political and [37] economic systems – an Ishmaelite among the nations of Europe – or taking part in the future of the world and helping to bring order and peace into it. I doubt she can stand alone for long. I doubt any nation can hope to achieve anything worth while single handed. I am confident that Herr Hitler is aware that an insane nationalism leads the world nowhere. To my mind there is no greater crime than to fire a people with ideas of their own super-eminent superiority. Incalculable harm has been done the world in the promotion of the idea among the peoples. A magnified sentiment of national pride always despises humanity at large. We saw it in the last War, the doctrine involved every nation in the direst peril. No country to-day is free of the scourge. It is useless blaming Germany for this complex as some of her foes are too prone to do. Nationalities-by-mutual-rights obtain the world over, and while they dominate every issue, I can see little hope for the realisation of humanity’s emancipation. They forced themselves on the World Economic Conference, they smashed the Disarmament Conference. And they will smash every well-meant political and economic issue and lead to further bloodshed unless they are scotched in time.

Herr Hess, in a speech to a congress of East Prussian Nazis on July 8th, 1934, made an appeal for frankness. Inter alia, he said:

“I appeal to the front line comrades of the [38] war, on both sides. Be frank. We felt then we were real men; we sometimes had pleasure in a life which was in direct contrast to the effeminacy which civilisation and over-civilisation bring; we felt ourselves better men than those far behind the front; we felt ourselves the defenders of the nation, the guardians of its future. We sometimes had happy hours, and tried to live every minute of them double. But be frank. We felt the fear of death. We saw it probably in more powerful form than any men before us. We crouched in dug-outs, waiting for the disintegrating impact. We held our breath when our trained ears heard the grenades whistling, the trench-mortars rumbling through the air towards us. Our hearts beat fit to burst as we vainly sought cover against machine-gun fire. We thought to suffocate beneath our gas-masks. We struggled through sodden trenches, froze in shell holes. We were then nearly desperate. We heard the shrieks of the wounded, saw the gassed men writhing, met blinded men staggering along, heard the last rattle of the dying. Among the piled corpses of our comrades we lost our last hope of life. We saw the widows and orphans, the cripples, the sickly children, the starving women. Be frank. Did we not all ask ourselves: What is the use of it all? Must it be so? Cannot mankind be spared this in future? But we held out – on both sides.

“Now I take up this question, and call it [39] accusingly to the world – as front-line soldiers to front-line soldiers, as the leaders of a nation to the leaders of other nations. Must it be so? Can we not with good will spare mankind all this?

How shall we answer Herr Hess? With the usual lies of Germany’s bad faith? I hope not.

More from [The Scriptorium‘s] English Archive:

The Case for Germany

What the World Rejected: Hitler’s Peace Offers 1933-1939

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Ezra Pound on Money
Carolina Hartley
May 26, 2010
Source: The Occidental Observer

We’re never far from money. We spend most of our time and energy in quest of money.

But how did this thing become an intermediary between us and the world around us? Before money, we bartered. Why did money supplant barter and who is custodian of the money system?

These questions are dangerous: they cost Ezra Pound twelve years. Pound was a victim of political persecution at the behest of financiers and their minions like Franklin Delano Roosevelt. These people feared Ezra because he asked “what is money for,” and came up with an inconvenient answer.

Pound understood that money is a ticket for exchange. People who make things can trade more easily with other people who make things using money. There should only be as much money as there are things to trade. Another way of saying this is: money supply should increase and decrease along with the change in economic output.

Here’s the rub. If money supply grows faster than the amount of things made, then theft is taking place. The thief creates extraneous dollars and spends them first: at the time when the rest of us expect a dollar to be worth a certain amount. By the time the thief’s dollars have been absorbed into the economy, we notice our dollars are buying less. This is inflation. The thief has dipped into our savings and traded with shoddy bills.

What happens when money supply shrinks compared to things made? Then a new characteristic of money emerges. Things made don’t always last — take bread for instance. A baker must sell his bread in a matter of days, otherwise it’s lost. Money isn’t bound by such considerations. A thief can horde money until the baker’s goods rot, then buy his bakery at a huge discount.

The “thief” in both these examples holds a special place in society: he controls the supply of money and “future money” called credit. Controlling money supply is economic power; it is a sovereign privilege. The people who really control a nation are those who control its money supply. [1]

Pound’s criticism of the financial class was that they were bad sovereigns. They managed money supply for their own benefit: they were thieves. In contrast, the Founding Fathers were good rulers because they designed a system where Congress managed the money supply; and Congress was accountable to a large segment of the population.

Pound identified the grasping, vampire-like nature of international finance, and the venal nature of its supporters in national governments.[2] He was interested in finding ways to systematically limit their power: perfecting what the Founding Fathers started in Article 1 Section 8 of the Constitution. This is why Pound studied the work of Silvio Gesell.

One of Gesell’s ideas was to eliminate the disparity between money and perishable goods. A way to do this is to discount large bills over time: holders of large bills would need to get them stamped every month, each stamp representing a decrease in their value. This way, hoarders bear the cost of their behavior and investment is encouraged. Small denominations would not be discounted.

Gesell recognized that the economy is like a body and money is like its blood. If blood builds up systematically in any one place, a disease results. His discounted script discouraged people from taking advantage of others’ simple lack of cash. (Note: this is quite different than being forced to lend to those who are unworthy of credit.) Saving in the form of investment was systematically encouraged.

Pound notes that Gesell’s system worked imperfectly in Alberta, Canada, mostly due to planning errors that could easily be fixed. The system worked very well in the Austrian village of Wörgl, and it was promptly closed down by mainstream financial interests.

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These mainstream financial interests were trying to preserve their privilege: they benefited from the increasing productivity of the societies they milked. Pound didn’t see how being born into a banking family, or buying the latest politician, should give them the right to those benefits. Ezra liked the ideas of Major Clifford Douglas: the people who worked should accrue those benefits. This is the essence of Social Credit.

The text of the 1933 version of Major Douglas’ book Social Credit, can be found here. Pound appreciated Maj. Douglas’ ideas, but thought they needed further exploration. What Pound really felt passionate about was fixing the money problem. Ezra wrote during the Great Depression when, much like now, people were captivated by the supposed security of gold.

Pound was never an advocate of gold-backed money. He understood how easily such systems can be subverted by controlling the supply or the clearing market for the backing commodity. Much of Britain’s power during the 19th century came from the fact that London was the clearing market for gold, and other nations relied upon a gold-standard currency. They had to go to England to manage their money!

In Ezra’s words:

The trick is simple. Whenever the Rothschild and other gents in the gold business have gold to sell, they raise the price. The public is fooled by propagandizing the devaluation of the dollar, or other monetary unit according to the country chosen to be victimized. The argument is that the high price of the monetary unit is injurious to the nation’s commerce.

But when the nation, that is, the people of that nation own the gold and the financiers own the dollars or other monetary units, the gold standard is restored. This raises the value of the dollar and the citizens of “rich” nations, as well as citizens of other nations, are diddled.

Preventing nations from being “diddled” is why Pound supported Fascism in Italy. He saw Fascism as the only system available to the Italians that was likely to deal with the threat from international finance. Mussolini’s Fascism let Italy be ruled in an Italian fashion — and until Anglo-American banking interests were threatened, things worked better in Italy than they had in a long time.

Pound never supported Fascism in America. We have our Constitution, which describes a government for Americans run in the American fashion. If it ain’t broke, don’t fix it. Pound realized that America’s challenge was implementing the laws we already have. Read Jefferson and/or Mussolini for his whole argument. [3]

Ezra was a true economic historian. He explained his analysis in the following way:

“The definition of an idea, as observed by someone who understands the events of the day, may shed more light on the historical process than many volumes.”

“History, as seen by a Monetary Economist, is a continuous struggle between producers and non-producers, and those who try to make a living by inserting a false system of book-keeping between the producers and their just recompense.”

“The usurers act through fraud, falsification, superstitions, habits and, when these methods do not function, they let loose a war. Everything hinges on monopoly, and the particular monopolies hinge around the great illusionistic monetary monopoly.”

Pound’s analysis identified the canker in American life: the cooperation between government and finance to defraud the public — the “monetary monopoly.” Monopolies don’t exist without tacit government approval. Beneficiaries of the financial monopoly have collaborated with venal officials against producers for a long time. The history of the largest American fortunes, since the Civil War at least, have followed this trend.

Historically, banking was begun by families as private businesses. As these businesses grew and issued receipts for gold and silver deposits, they gradually developed “fractional reserve” banking by issuing more notes than they had gold on deposit. Although kings would mint coins of gold and silver they owned at their royal mints, fractional reserve banking was a dangerous business, and Kings did not want to gamble with their sovereign power by going into that business. Rather, kings and especially parliaments, became dependent upon these fractional reserve bankers for loans, and would grant monopoly charters to a group of private bankers to create a national or central bank which would then have the power to regulate the size of the money stock through its fractional reserve activities, as it collected taxes, issued the national paper currency and sold sovereign debt on behalf of the government.

These national or central banks conferred significant advantages on the private banks that organized and owned them. Private banks were allowed to borrow at the discount window at special rates provided that they posted reserves with the central bank. Of course, the real advantage of the central bank for its owners and organizers was inside information. During the years of the gold standard, having a seat on the board of a central bank meant that the insider would know when emergency borrowings ticked up, telegraphing the probable start of a bank crisis and stock market crash. In the case of war, it was an easy task for a private bank with seats in several different national banks to calculate the deposits and income of the contesting states and the loans they secured to raise their armies, thus allowing the privileged few to bet on the probable winner. [ed: Although it should be added that it is not at all historically uncommon for the bankers to fund both sides of a given conflict, considering they would then be entitled to the victor’s wealth, as well as to the oft enormous reparation sums of the vanquished. So do keep this in mind — particularly when you hear about this or that private lender or institution “financing” the National Socialists in their formative years. The lender cares not who wins or loses in the long run; his loyalty is to profit — nothing more, nothing less. And if he can cover both bases — and he often manages to do just that — then surely his lack of attachment has proven profitable.]

The gold standard was popular among bankers for the simple reason that the supply of gold increased irregularly but on average more slowly than the increase in population, meaning that the value of loans would gradually increase over time as would the burden of repayment. Debtors resented the power of gold, hence William Jennings Bryan’s political appeal and his famous “Cross of Gold” speech. Coincidentally the gold standard was finally abandoned in 1971, six years after the birth control pill descended upon the civilized world.

Pound recognized two very important threats to the international banking community that arose out of the Third Reich. First, Hitler abandoned the gold standard, meaning that National Socialist Germany suddenly had the power to prevent defaulting on its future debt simply by printing money — a power that the U.S. copied from Germany just as it copied the autobahns. Second, and much more important, the Reich took back the power of central banks by financing infrastructure projects directly, issuing notes in payment to the laborers, contractors, and suppliers rather than first borrowing the money from a central bank at interest. (See here and here.) If this practice had spread, bankers would be no more powerful than plumbers.

Furthermore, as long as the supply of this newly printed money in the form of notes [marks] matched the increase in GNP and future productivity from these new highways, rails, and factories, the printing of money would not necessarily produce inflation. The Reich also issued debt directly to German citizens and businesses to finance Hitler’s economic miracle, but the central banks lost control over the money supply and lost the ability to trigger banking panics and depressions inside the Reich. It was a mortal threat [for the bankers], and [from their perspective] it had to be stopped. Pound was right.

Hitler’s experiment in freedom from banking was thus broken, and the finance/government partnership was preserved at the cost of millions of lives in World War II.

This finance/government collaboration explains the American elites’ love affair with international socialism. They don’t know how to make money any other way. Competition is a sin. Government organized monopolies are profitable when you control the government. If there are no national restrictions on moving profits around, they can hide their loot offshore. The perfect crime.

Pound recommended the writings of John Adams, Thomas Jefferson and Martin Van Buren[4] for a practical explanation of how the young Republic wrested itself from London finance. He recommended Classical study (Aristotle’s Politics and the works of Demosthenes) for understanding the tricks financiers use. Nationally-controlled money was popular politics until the Civil War, when Pound notes a collective amnesia took the mind of the American public. Tragedy and forgetfulness. This is also the time when Lincoln let the bankers back in with the National Banking Act.

Ezra didn’t revel in victimhood. The “monetary monopoly” was made possible by voters’ laziness. In his ABC of Economics, Pound castigates the American public for letting its money fall into the hands of enemies and irresponsible men. Americans circa 1930 were ignorant about money and banking; the situation today is even worse. It is a national tragedy that we have been lazy enough to allow Congress sell its responsibilities and hostile elites control our credit.

The way to fix the situation is to dissolve the Federal Reserve; force Congress to manage money supply as described in the Constitution; and vote the venal or incompetent out of office. The revolutionary patriots gave us the tools; we need to step up to the plate and use them.

Our amnesia and laziness have been granted every assistance. Pound pointed out that hostile elites were overrepresented in academia and the media — a situation which has worsened with time. Now we are reaping the harvest: schools devoid of the Classics; universities teaching castrated Economics; and Gloria Vanderbilt’s boy on TV. Ezra saw it coming, and he told us how to fix it.

Carolina Hartley (email her) has a degree in Finance and Economics from the University of Chicago. She is also student of aesthetics and social history, though not from the orthodox perspective.

[1] Pound’s repeated recommendation of Christopher Hollis’ work The Two Nations is based on the book’s excellent explanation of British economic power over the centuries.

[2] “Ezra Pound Speaking”: Radio Speeches of World War II. Edited by Leonard W. Doob. Greenwood Press, 1978. Return to text.

[3] Pound recommended the correspondence between John Adams and Thomas Jefferson and the writings of Van Buren for the economic history of the United States.

Pound’s Pamphlets on Money are excellent; the first “An Introduction to the Economic Nature of the United States” and “A Visiting Card” are particularly useful. (Published by Peter Russell, London. 1950.) Return to text.

[4] The Works of John Adams: Second President of the United States: with A Life of the Author, notes and illustrations, by his Grandson, Charles Francis Adams. Little, Brown and Co. Boston 1850–56.

The Writings of Thomas Jefferson, Memorial Edition, XX Volumes, Washington, 1903-04.

The Autobiography of Martin Van Buren, written in 1854 and remaining in manuscript until its publication as Vol. II of the “Annual Report of the American Historical Association for the year 1918,” Government Printing Office, Washington 1920.

Pound also recommends Jefferson and Hamilton by Claude G. Bower.

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The Money Masters: How International Bankers Gained Control of America
Source: http://www.themoneymasters.com

THE MONEY MASTERS is a 3 1/2 hour non-fiction, historical documentary that traces the origins of the political power structure. The modern political power structure has its roots in the hidden manipulation and accumulation of gold and other forms of money. The development of fractional reserve banking practices in the 17th century brought to a cunning sophistication the secret techniques initially used by goldsmiths fraudulently to accumulate wealth. With the formation of the privately-owned Bank of England in 1694, the yoke of economic slavery to a privately-owned “central” bank was first forced upon the backs of an entire nation, not removed but only made heavier with the passing of the three centuries to our day. Nation after nation has fallen prey to this cabal of international central bankers.

The success of the central banking scheme developed into a far-reaching plan described by President Clinton’s mentor, Georgetown Professor Carroll Quigley, “to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations. Each central bank….sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the levels of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world.”

Several short-lived attempts to impose the central banking scheme on the United States were defeated by the patriotic efforts of Presidents Madison, Jefferson, Jackson, Van Buren and Lincoln. But with the passage of the Federal Reserve Act of 1913, America was firmly lashed to the same yoke, so that a small number of very rich men have been able to lay upon the masses a yoke little better than slavery itself. That yoke inevitably grows heavier with ever-compounding interest, and totals over $20 trillion of debt owed by the American people today ($80,000 per American) ultimately to these bankers.

This vast accumulation of wealth concentrates immense power and despotic economic domination in the hands of the few central bankers “who are able to govern credit and its allotment, for this reason supplying, so to speak, the life-blood to the entire economic body, and grasping, as it were, in their hands the very soul of the economy so that no one dare breathe against their will.”

Segments: The Problem; The Money Changers; Roman Empire; The Goldsmiths of Medieval England; Tally Sticks; The Bank of England; The Rise of the Rothschilds; The American Revolution; The Bank of North America; The Constitutional Convention; First Bank of the U.S.; Napoleon’s Rise to Power; Death of the First Bank of the U.S. / War of 1812; Waterloo; Second Bank of the U.S.; Andrew Jackson; Abe Lincoln and the Civil War; The Return of the Gold Standard; Free Silver; J.P. Morgan / 1907 Crash; Jekyll Island; Fed Act of 1913; J.P. Morgan / WWI; Roaring 20s / Great Depression; FDR / WWII / Fort Knox; World Central Bank; Conclusions.

View the documentary in its entirety directly below.

“Let me issue and control a nation’s money and I care not who writes the laws.”
-Mayer Amschel Rothschild (1744-1812), founder of the House of Rothschild.

When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes… Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.”
– Napoleon Bonaparte, Emperor of France, 1815

“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks…will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered… The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”
– Thomas Jefferson in the debate over the Re-charter of the Bank Bill (1809)

“I believe that banking institutions are more dangerous to our liberties than standing armies.”
– Thomas Jefferson

“…The modern theory of the perpetuation of debt has drenched the earth with blood, and crushed its inhabitants under burdens ever accumulating.”
-Thomas Jefferson

“History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance.”
-James Madison

“The few who understand the system will either be so interested in its profits or be so dependent upon its favours that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests.”
-The Rothschild brothers of London writing to associates in New York, 1863.

“The Government should create, issue, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of consumers. By the adoption of these principles, the taxpayers will be saved immense sums of interest. Money will cease to be master and become the servant of humanity.”
-Abraham Lincoln

“The death of Lincoln was a disaster… There was no man in the United States great enough to wear his boots and the bankers went anew to grab the riches. I fear that foreign bankers with their craftiness and tortuous tricks will entirely control the exuberant riches of America and use it to systematically corrupt civilization.”
-Otto von Bismark (1815-1898), German Chancellor, after the Lincoln assassination

“Issue of currency should be lodged with the government and be protected from domination by Wall Street. We are opposed to…provisions [which] would place our currency and credit system in private hands.”
– Theodore Roosevelt

Despite these warnings, Woodrow Wilson signed the 1913 Federal Reserve Act. A few years later he wrote:

“I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men.”
-Woodrow Wilson

“I am afraid the ordinary citizen will not like to be told that the banks can and do create money. And they who control the credit of the nation direct the policy of Governments and hold in the hollow of their hand the destiny of the people.”
-Reginald McKenna, as Chairman of the Midland Bank, addressing stockholders in 1924.

“It is well enough that people of the nation do not understand our banking and money system, for if they did, I believe there would be a revolution before tomorrow morning.”
-Henry Ford, founder of the Ford Motor Company.

“The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it. The process by which banks create money is so simple the mind is repelled. With something so important, a deeper mystery seems only decent.”
-John Kenneth Galbraith (1908- ), former professor of economics at Harvard, writing in ‘Money: Whence it came, where it went’ (1975).
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The documentary above is outstanding, overall, and I am sincerely grateful to all those who contributed to its research. I only wish that more would have been said in the WWII segment concerning the successful economic reforms which took place under Adolf Hitler. I am naturally aware that this is an unpopular subject in the mainstream, of course; but by failing to adequately explore the issue of National Socialist Germany’s debt-free national revival, as well as the foundation of its stable currency against the gold standard, the primary causes of WWII are sure to remain misunderstood. Nevertheless, you can study the matter in greater detail HERE and HERE, and I hope that you will. Until Hitler’s economic revolution is understood, the establishment’s artificial excuses for that terrible war will continue to be used against us. I trust critical thinkers to review the information available here and elsewhere and make up their own minds. -W.

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Hitler’s Economic Revolution
by Magister James D. Sass

In response to a bulletin in circulation I am posting this small fragment of a much longer article on the 20th century that I wrote in 1992 that I am in the process of rewriting, expanding and updating for a collection of essays on social/political topics. (Another earlier part of this longer essay was adapted for the afterword to the Underworld Amusements reprint of Nietzsche’s The Antichrist.) JDS

{SNIP}….Therefore the media-created picture of the Nazis as abject monsters and the German people either as barbarians or gullible fools and sadists, must be transcended in order to examine the years in which the monetarists emerged as a force in world affairs. Since reason and our knowledge of human nature and history forces us to reject the notion of one set of human beings as the epitome of evil while another set are the epitome of heroic liberators imbued with all the ideal qualities of human justice, there is no escaping the fact that the history of the twentieth century must be reexamined. As we stated when entering this inquiry, historical revisionism is one thing, but using another method of analyzing events is another. Until the record of the last century, including specifically the distortion of historical events and personages in post-Weimar Germany, is corrected, we will be unable to make sense of our times.

It is impossible to measure the growth of these financial centers and the cross-over from being institutions to being the meridian points in a trans-national flow-system of money movement and currency manipulation. The creation of new money, and what institutions and agencies and people had the capacity to create it, all depends on our ability to examine the material of our times dispassionately without the disruption of inquiry by denunciation as being anti-humanist, or by rejection as being reactionary.

Once the fictitious layers of histrionic personality attacks have been peeled off to reveal the essential reality, then one must peel off the distortions of motives and events. The whole trajectory is suspect when viewed from a detached perspective. Hitler is a psychopath; Stalin is a sympathetic heavy-drinking avuncular figure, (yet somehow boding ill for the future); Churchill is the heroic archetypal Englishman fighting for freedom with his back to the wall; Roosevelt is the American aristocrat prepared to sacrifice his life for freedom, etc. The current view of Weimar Germany as a glorious Mecca of free artistic expression and culture is a gross distortion of the degradation and anarchic conditions that called out for renovation and renewal, which was just what the National Socialists brought to that cesspool of economic and social chaos, rapidly transforming Germany into the leading industrial nation in Europe with restored self-respect. The current mythology of Hitler as a demonic lunatic bent on world domination is perhaps the most pernicious distortion of facts in the whole spectrum of this time period. The irony of it being that England was in reality the country that had been and continued to be the country of global domination. As Hitler pointed out, “A minority of 45 million Englishmen rule 600 million inhabitants of the British Empire.” Yet according to status quo history Hitler’s alleged desire for “world domination” was a lunatic project that had to be stopped. What in fact did Hitler want? What was his world-view? What was his critique? How far was he right? What went wrong? All these questions must be answered within a framework allowing us to see the crucial matter of how and by what structural and dynamic methods did trans-national financial power come to dominate and control political entities.

It is worth noting that among the famous 20 Points of Hitler’s National Socialist Party was the commitment to “break the bondage of interest.” It is this that lies at the heart of the convulsive tremors that went through middle Europe in the twenties and thirties. It was also the failure of that era to realize what forces were in play, unleashed by the first significant attempt to allow a nationalist state power to control its own wealth system. In his monumental Military History of the Western World, J.F.C. Fuller, (the British Fascist, Major-General in the British Army, and respected military historian), writes, “Among these artists of power were two men possessed of a new philosophy – Benito Mussolini and Adolf Hitler. They challenged the myth of Economic Man, the fundamental factor in Capitalism, Socialism, and Communism, and exalted in its stead the myth of the Heroic Man…. In Hitler’s eyes the aims of international Capitalism and Marxism were one and the same. Both, he said, repudiated ‘the aristocratic principle of Nature’; both were destroyers of quality, not of things but of life…. Unless this struggle between these two myths – Economic Man and Heroic Man – is accepted and understood, the cataclysm which in 1939 submerged the world is almost incomprehensible and the age to which it gave birth little more than the plaything of chance.” Aside from a natural gift for leadership, continues Fuller, “The demons that exalted him were the Treaty of Versailles, which bore no resemblance to Wilson’s Fourteen Points… the invasion of the Ruhr by Poincare in 1923, which debauched the German currency and wiped out the German middle classes; the influx of £750m. in foreign loans between 1924 and 1930, which debauched the German people, and lastly the crash on the American stock exchange, which begat the world-wide monetary depression of 1929-31. In 1930, 17,500,000 Germans were supported by the state, and in 1931 the Communist electorate in Germany rose to over five million. In that year the American journalist H.R. Knickerbocker… estimated that at least 15 million Germans were partially starving; that two-thirds of the voters were hostile to Capitalism, and more than half were hostile to the existing political system called democracy. In the following year these calamities led to Hitler’s triumph… Save by those who witnessed it, the exultation of the masses on Hitler’s advent to power is unbelievable… Whether this extraordinary man was devil or madman, as his enemies proclaimed him to be, in no way belittles the fact that he stamped out Bolshevism in Germany and accomplished astonishing things.”

Fuller further describes Hitler’s financial reforms as of foremost importance among these astonishing accomplishments, “Hitler’s goal was Napoleonic: to establish a German Continental System under the aegis of Germany. Also his means were not far removed from those of the great emperor: to liberate Germany from the shackles of international loan-capitalism, to unite all Germanic peoples into the Third Reich, and to establish in eastern Europe what he called the German Lebensraum (living space) which he considered as essential to the economic security of Germany as Napoleon had considered the confederation of the Rhine essential to the strategic security of France. Hitler held that, as long as the international monetary system was based on gold, a nation which cornered gold could impose its will on those who lacked it. This could be done by drying up their sources of exchange, and thereby compelling them to accept loans on interest in order to distribute their wealth – their production. He said: ‘The community of the nation does not live by the fictitious value of money, but by real production which in its turn gives value to money. This production is the real cover of the currency, and not a bank or a safe full of gold.’”

Fuller continues by outlining Hitler’s reforms, “He decided: (1) To refuse foreign interest-bearing loans, and to base currency on production instead of gold. (2) To obtain imports by direct exchange of goods – barter – and subsidize exports when necessary. (3) to put a stop to what was called ‘freedom of the exchanges’ – that is, license to gamble in currencies and shift private fortunes from one currency to another according to the political situation. And (4) To create money when men and material were available for work instead of running into debt by borrowing it.” This had a tremendous impact on the trans-national financiers, “Because the life of international finance depended upon the issue of interest-bearing loans to nations in economic distress, Hitler’s economics spelt its ruination. If he were allowed to succeed, other nations would certainly follow his example, and should a time come when all non-gold-holding governments exchanged goods for goods, not only would borrowing cease and gold lose its power, but the money-lenders would have to close shop… This financial pistol was pointed more particularly at the United States, because they held the bulk of the world’s supply of gold, and because their mass-production system necessitated the export of about 10 percent of their products in order to avoid unemployment. Further, because the brutalities meted out to German Jews by Hitler understandably had antagonized American Jewish financiers, six months after Hitler became Chancellor, Samuel Untermyer, a wealthy New York attorney, threw down the challenge. He proclaimed ‘holy war’ against National Socialism and called for an economic boycott of German goods, shipping, and services.” Hitler’s reforms also had a tremendous impact on his domestic economy, further arousing international resentment. Fuller continues, “Between 1933 and 1936, Hitler had reduced German unemployment from six millions to one, and prosperity had so far returned that… in 1936 Winston Churchill is reported to have said… ‘Germany is getting too strong and we must smash her.’” Fuller astutely observes of the world situation at this juncture, “When we consider these economic causes of the Second World War it must be borne in mind… that the struggle between the two economic systems is not a question of right and wrong but of survival values.”

Other political events brought the impending conflict to a head; Germany withdrew from the League of Nations in 1933, negotiating with Poland to secure the eastern flank, repudiated the arms provision of the Versailles Treaty and reintroduced conscription in 1935; then after dishonorably failing to fulfill treaty agreements with Italy over Abyssinia, the League of Nations was not only discredited but instrumental in driving Mussolini into strategic alliance with Hitler.

These and other crisis, Fuller writes, “…generated a violent propaganda against Hitler. Foreign affairs lost all objectivity and became wrapped in an explosive animosity which so perturbed Dr. Goebbels… that he appealed to the American Ambassador in Berlin, who replied that the ‘most crucial thing that stood between any betterment of American Press relationships was the Jewish question.” The situation deteriorated when a young Polish Jew assassinated the third secretary at the German Embassy in Paris (1938), precipitating an immediate pogrom against the Jews in Berlin, which added fuel to the anti-German propaganda mills in the United states.

Fuller quotes at length the very revealing report to the Polish Foreign Office from Count Jerzy Potoki, the Polish Ambassador to Washington, dated January 12, 1939; “Public opinion in America nowadays… expresses itself in increasing hatred of everything… connected with National Socialism. Above all, propaganda here is entirely in Jewish hands… when bearing public ignorance in mind, their propaganda is so effective that people here have no real knowledge of the true state of affairs in Europe…. It is interesting to observe that in this carefully thought-out campaign – which is conducted primarily against National Socialism – no reference at all is made to Soviet Russia. If that country is mentioned, it is referred to in a friendly manner and people are given the impression that Soviet Russia is part of the democratic group of countries. Thanks to the astute propaganda, public sympathy in the USA is entirely on the side of Red Spain. Side by side with this propaganda an artificial war-panic is created…. No effort is spared to impress upon the American mind that in the event of a war the USA must take an active part in a struggle for freedom and democracy. President Roosevelt was first in the field to give expression to his hatred of Fascism. He had a two-fold purpose in mind: firstly, he wanted to divert American public opinion from difficult and complicated domestic problems… Secondly, by creating a war-panic… he wanted to induce Americans to endorse his huge program of armaments…. Furthermore, the brutal treatment meted out to the Jews in Germany as well as the problem of the refugees are both factors which intensify the existing hatred of everything connected with German National Socialism. In this campaign of hatred, individual Jewish intellectuals such as Bernard Baruch, Lehman, Governor of New York State, Felix Frankfurter, the newly appointed Supreme Court Judge, Morgenthau, the Financial Secretary, and other well known personal friends of Roosevelt have taken a prominent part. All of them want the President to become the protagonist of human liberty, religious freedom and the right of free speech…. This particular group of people, who are all in highly placed American official positions and who are desirous of being representatives of ‘true Americanism’, and as ‘Champions of Democracy’, are, in point of fact, linked with international Jewry by ties incapable of being torn asunder. For international Jewry – so intimately concerned with the interests of its own race – President Roosevelt’s ‘ideal’ role as a champion of human rights was indeed a godsend. In this way Jewry was able not only to establish a dangerous center in the New World for the dissemination of hatred and enmity, but it also succeeded in dividing the world into two warlike camps. The whole problem is being tackled in a most mysterious manner. Roosevelt has been given the power to enable him to enliven American foreign policy and at the same time to create huge reserves in armaments for a future war which the Jews are deliberately heading for.”……..{SNIP}….(c)2009 JDS.

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Thinking Outside the Box: How a Bankrupt Germany Solved its Infrastructure Problems
Ellen Brown, August 9th, 2007
source

“We were not foolish enough to try to make a currency [backed by] gold of which we had none, but for every mark that was issued we required the equivalent of a mark’s worth of work done or goods produced. . . .we laugh at the time our national financiers held the view that the value of a currency is regulated by the gold and securities lying in the vaults of a state bank.”

– Adolf Hitler, quoted in “Hitler’s Monetary System,”

Guernsey wasn’t the only government to solve its infrastructure problems by issuing its own money. (See E. Brown, “Waking Up on a Minnesota Bridge,” http://www.webofdebt.com/articles/infrastructure-crisis.php, August 4, 2007.) A more notorious model is found in post-World War I Germany. When Hitler came to power, the country was completely, hopelessly broke. The Treaty of Versailles had imposed crushing reparations payments on the German people, who were expected to reimburse the costs of the war for all participants — costs totaling three times the value of all the property in the country. Speculation in the German mark had caused it to plummet, precipitating one of the worst runaway inflations in modern times. At its peak, a wheelbarrow full of 100 billion-mark banknotes could not buy a loaf of bread. The national treasury was empty, and huge numbers of homes and farms had been lost to the banks and speculators. People were living in hovels and starving. Nothing quite like it had ever happened before – the total destruction of the national currency, wiping out people’s savings, their businesses, and the economy generally. Making matters worse, at the end of the decade global depression hit. Germany had no choice but to succumb to debt slavery to international lenders.

Or so it seemed. Hitler and the National Socialists, who came to power in 1933, thwarted the international banking cartel by issuing their own money. In this they took their cue from Abraham Lincoln, who funded the American Civil War with government-issued paper money called “Greenbacks.” Hitler began his national credit program by devising a plan of public works. Projects earmarked for funding included flood control, repair of public buildings and private residences, and construction of new buildings, roads, bridges, canals, and port facilities. The projected cost of the various programs was fixed at one billion units of the national currency. One billion non-inflationary bills of exchange, called Labor Treasury Certificates, were then issued against this cost. Millions of people were put to work on these projects, and the workers were paid with the Treasury Certificates. This government-issued money wasn’t backed by gold, but it was backed by something of real value. It was essentially a receipt for labor and materials delivered to the government. Hitler said, “for every mark that was issued we required the equivalent of a mark’s worth of work done or goods produced.” The workers then spent the Certificates on other goods and services, creating more jobs for more people.

Within two years, the unemployment problem had been solved and the country was back on its feet. It had a solid, stable currency, no debt, and no inflation, at a time when millions of people in the United States and other Western countries were still out of work and living on welfare(!!!). Germany even managed to restore foreign trade, although it was denied foreign credit and was faced with an economic boycott abroad. It did this by using a barter system: equipment and commodities were exchanged directly with other countries, circumventing the international banks. This system of direct exchange occurred without debt and without trade deficits. Germany’s economic experiment, like Lincoln’s, was short-lived (“thanks” to the second world war); but it left some lasting monuments to its success, including the famous Autobahn, the world’s first extensive superhighway.1

Hjalmar Schacht, who was then head of the German central bank, is quoted in a bit of wit that sums up the German version of the “Greenback” miracle. An American banker had commented, “Dr. Schacht, you should come to America. We’ve lots of money and that’s real banking.” Schacht replied, “You should come to Berlin. We don’t have money. That’s real banking.”2

Hitler has gone down in infamy in mainstream history books, but he was immensely popular with the German people who voted him in, democratically, at 98%. Stephen Zarlenga suggests in The Lost Science of Money that this was merely because he temporarily rescued Germany from English economic theory — the theory that money must be borrowed against the gold reserves of a private banking cartel rather than issued outright by the government.3 ***According to Canadian researcher Dr. Henry Makow, this may have been a chief reason Hitler had to be stopped: he had sidestepped the international bankers and created his own money.*** Makow quotes from the 1938 interrogation of C. G. Rakovsky, one of the founders of Soviet Bolsevism and a Trotsky intimate, who was tried in show trials in the USSR under Stalin. According to Rakovsky, Hitler had actually unknowingly been funded by the international bankers for a time, through their agent Hjalmar Schacht, in order to control/counter-check Stalin, who had usurped power from their agent Trotsky. But Hitler had become an even bigger threat to the international bankers than Stalin when he had taken the bold step of printing his own money. Rakovsky said:

[Hitler] took over for himself the privilege of manufacturing money and not only physical moneys, but also financial ones; he minted a new mark and put it to work for the benefit of the state . . . . Are you capable of imagining what would have come . . . if it had infected a number of other states? If you can, then imagine its counterrevolutionary functions!4

Economist Henry C K Liu writes of Germany’s remarkable transformation:

The Nazis came to power in Germany in 1933, at a time when its economy was in total collapse, with ruinous war-reparation obligations and zero prospects for foreign investment or credit. Yet through an independent monetary policy of sovereign credit and a full-employment public-works program, the Third Reich was able to turn a bankrupt Germany, stripped of any overseas colonies it could exploit (like the British had always done), into thee strongest economy in Europe within four years (!!!), even before armament spending began.5

In Billions for the Bankers, Debts for the People (1984), Sheldon Emry commented:

Germany issued debt-free and interest-free money from 1935 and on, accounting for its startling rise from the depression to a world power in 5 years [can you see why hitlers successful example of economic reform threatened international banking? it eliminated interest with a single, broad-stroke and threw the usurers on their heads. those who were most deeply disadvantaged then turned around and spun this entire reform as a threat to democracy and decency around the world– just like they do today with their “terrorist” enemies]. Germany financed its entire government and war operation from 1935 to 1945 without gold and without debt, and it took the whole Capitalist and Communist world to destroy the German power over Europe and bring Europe back under the heel of the Bankers. Such history of money does not even appear in the textbooks of public (government) schools today. [the reasons are abundantly clear when you remember that the victors write our books while the vanquished have no voice.]

Another Look at the Weimar Hyperinflation

What does appear in modern textbooks is the disastrous runaway inflation suffered in 1923 by the Weimar Republic (the common name for the republic that governed Germany ***before Hitler came on the scene*** from 1919 to 1933). The radical devaluation of the German mark is cited as the textbook example of what can go wrong when governments are given the unfettered power to print money (exactly what our government is doing today, and with the very same consequences). That is what it is cited for; but in the complex world of economics, things are not always as they seem. The Weimar financial crisis began with the impossible reparations payments imposed at the Treaty of Versailles. Schacht, who was currency commissioner for the Republic, complained:

The Treaty of Versailles is a model of ingenious measures for the economic destruction of Germany. . . . The Reich could not find any way of holding its head above the water other than by the inflationary expedient of printing bank notes.

That is what he said at first. But Zarlenga writes that Schacht proceeded in his 1967 book The Magic of Money “to let the cat out of the bag, writing in German, with some truly remarkable admissions that shatter the ‘accepted wisdom’ the financial community has promulgated on the German hyperinflation.”6 Schacht revealed that it was the privately-owned Reichsbank which operated before Hitler’s ascent, not the German government, that was pumping new currency into the economy. Like the U.S. Federal Reserve, the Reichsbank was overseen by appointed government officials but was operated for private gain. What drove the wartime inflation into hyperinflation was speculation by foreign investors, who would sell the mark short, betting on its decreasing value. In the manipulative device known as the short sale, speculators borrow something they don’t own, sell it, then “cover” by buying it back at the lower price. Speculation in the German mark was made possible because the Reichsbank made massive amounts of currency available for borrowing, marks that were created with accounting entries on the bank’s books and lent at a profitable interest (fractional reserve). When the Reichsbank could not keep up with the voracious demand for marks, other private banks were allowed to create them out of nothing and lend them at interest as well.7

According to Schacht, then, not only did the government not cause the Weimar hyperinflation, but it was the Hitler government that got it under control. The Reichsbank was put under strict government regulation, and prompt corrective measures were taken to eliminate foreign speculation, by eliminating easy access to loans of bank-created money. Hitler then got the country back on its feet with his Treasury Certificates issued Greenback-style by the government.

Schacht actually disapproved of this government fiat money, and wound up getting fired as head of the Reichsbank when he refused to issue it (something that may have saved him at the Nuremberg trials). But he acknowledged in his later memoirs that allowing the government to issue the money it needed had not produced the price inflation originally predicted by classical economic theory. He surmised that this was because factories were sitting idle and people were unemployed. In this he agreed with John Maynard Keynes: when the resources were available to increase productivity, adding new money to the economy did not increase prices; it increased goods and services. Supply and demand increased together, leaving prices unaffected.

___________________

1 Matt Koehl, “The Good Society?”, www. rense. com (January 13, 2005); Stephen Zarlenga, The Lost Science of Money (Valatie, New York: American Monetary Institute, 2002), pages 590-600.

2 John Weitz, Hitler’s Banker (Great Britain: Warner Books, 1999).

3 S. Zarlenga, op. cit.

4 Henry Makow, “Hitler Did Not Want War,” www. savethemales. com (March 21, 2004).

5 Henry C. K. Liu, “Nazism and the German Economic Miracle,” Asia Times (May 24, 2005).

6 Stephen Zarlenga, “Germany’s 1923 Hyperinflation: A ‘Private’ Affair,” Barnes Review (July-August 1999); David Kidd, “How Money Is Created in Australia,” http://dkd. net/davekidd/politics/money. html (2001).

7 S. Zarlenga, “Germany’s 1923 Hyperinflation,” op. cit.

Ellen Brown, J.D., developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and “the money trust.” She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. Brown’s eleven books include the bestselling Nature’s Pharmacy, co-authored with Dr. Lynne Walker, which has sold 285,000 copies.

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