Chapter Three: ANDREW JACKSON: THE LAST ANTI- ELITIST PRESIDENT: The Federal Reserve Conspiracy by Antony C. Sutton from archive.org
Chapter Three: ANDREW JACKSON: THE LAST ANTI- ELITIST PRESIDENT
The original charter for the Second Bank of the United States was limited in time, unlike the present Federal Reserve System. A new charter for the (Second) Bank of the United States to replace the expiring grant was passed by Congress in July 1832, and President Andrew Jackson promptly vetoed the charter, with an emphatic message of major historical interest. According to modern academic opinion the Jackson veto is "legalistic, demagogic and full of sham." (1) In fact, on reading the message today Andrew Jackson was clearly prophetic in his warnings and arguments to the American people. In the first inaugural address in January 1832, Jackson stated his position on the bank and renewal of the charter: As the
Charter of the Bank of the United States will expire in 1836, and its stockholders will most probably apply for a renewal of their privileges; in order to avoid the evils resulting from precipitancy in a measure involving such important principles and such deep pecuniary interests, I feel that I cannot in justice to our constituents and to the parties interested too soon present it to the 17 The Federal Reserve Conspiracy deliberate consideration of the Legislature and the people. The constitutionality of this law has been well questioned.. .because it grants to those who hold stock exclusive privileges of a dangerous tendency. Its expediency is denied by a large portion of our citizens. ..and it is believed none will deny that it has failed in the great end of our establishing a uniform and sound currency throughout the United States. (2) Andrew Jackson's personal view on the Second Bank of the United States is contained in a memorandum in Jackson's own handwriting written in January, 1832. (3) The opinion shows how far present constitutional interpretation has diverged from the intent of our founding fathers. Jackson's opening argument is that all "sovereign power is in the people and the states," and then argues that in cases, such as the power to grant corporations, where the power is not expressly given to the general (Federal) government, then "no sovereign power not expressly granted can be exercised, by implication." The key is "implied power." There are no implied powers in the Constitution. Jackson goes on to argue that it may be possible for "necessity" to give power to grant charters to banks and corporations, but this must be a "positive necessity not a fained one." And then only within the ten mile square of Washington, DC itself does Congress have such sovereign power. Jackson argues as follows: It is inconsistent with any of the powers granted that our government should form a corporation and become a member of it. The founders were too well aware of the corrupting influence of a great moneyed monopoly upon government to legalize such a corrupting monster 18 Andrew Jackson: The Last Anti-Elitist President by any grant either expressed or implied in the Constitution. The extraordinary difficulty and massive political power that Jackson faced in fighting the "money monopoly" and its influence is shown in his letter to Hugh L. White, dated April 29, 1831 (Vol. 4, page 271): The great principles of democracy which we have both at heart to see restored to the federal government cannot be accomplished unless by a united cabinet who labor to this end. The struggles against the rechartering of the United States Bank are to be met. The corrupting influence of the Bank upon the morals of the people and upon Congress are to be fearlessly met.... Many who you would not have supposed have secretly enlisted in its ranks and between bank men nullifiers and internal improvement men it is hard to get a cabinet who will unite with me heart and hand in the great task of democratic reform in the administration of our government. By 1833 the struggle over the rechartering of the Bank of the United States had degenerated into a conflict between Andrew Jackson and his secretary of the treasury, William J. Duane and ultimately led to dismissal of Duane. Jackson wanted to withdraw all government deposits from the private Bank of the United States while Duane refused to order removal of the deposits. In a letter dated June 26, 1833 (Vol. 5, page 111) Andrew Jackson expands on his demand for withdrawal of government deposits from the Bank of the United States, and proposes that one bank be selected in each of various cities to receive government deposits. State banks with good credit would be preferable to the concentration of 19 The Federal Reserve Conspiracy, government funds in one bank which was a private monopoly. The letter was accompanied by a paper explaining Jackson's views on possible government relations with the Bank of the United States and the future. Included was this straightforward statement: The framers (of our Constitution) were too well aware of the corrupting influences of a great moneyed monopoly upon government to legalize such a corrupting monster by any grant either express or implied in the constitution. Bank corporations are brokers on a large scale, and could it be really urged that the framers of the Constitution intended that our Government should become a Government of Brokers? If so, then the profits of the National Brokers Shop must enure to the benefit of the whole people, and not a few privileged moneyed capitalists, to the utter rejection of the many. The opinion recalled that in December 1831 Congress petitioned for a renewal of the bank charter and Jackson had vetoed the bill. As Jackson was then a candidate for reelection this in effect brought the veto directly before the electorate and in approving the president the public also condemned the bill as both "inexpedient and unconstitutional." In other words Jackson argued that his veto had already received public approval. Therefore, Jackson continued, "the duty of the bank was to wind up its concerns in such a manner that will produce the least pressure upon the money market." Jackson recalled the extraordinary and rapid increase of government debt to the bank which had grown by $28 20 Andrew Jackson: The Last Anti-Elitist President million or 66 percent in a period of 16 months. Jackson commented as follows: The motive of the enormous extension of loans can no longer be doubted. It was unquestionably to gain power in the country and force the government through the influence of the debtors to grant it a new charter. This must be the first and last statement from an American President declaring what many now suspect: that certain banks (but not all bankers) use debt as a political weapon for control. We cannot include all bankers because bankers in Catholic countries, for example, are forbidden on grounds of religion from using debt for control. This would amount to usury. Jackson goes on to outline the reasons for his wish to sever connections between the bank and the government: a leading objection is that the Bank of the United States has the power and in that event will have the disposition to crush the state banks particularly those which may be selected by the government as the depositories of its funds and thus cause wide spread distress and ruin throughout the United States. Then Jackson makes an argument strange to the ears of those reading in the 20th century: The only currency known to the Constitution of the United States is gold and silver. This is consequently the only currency which that instrument delegates to Congress the power to regulate. This suggests that Andrew Jackson would have considered the present Federal Reserve System, a private 21 The Federal Reserve Conspiracy bank-owned monopoly, to be unconstitutional and in fact "the money monster" in new form. President Andrew Jackson's final message on March 4, 1837 was unbelievably prophetic in its content - and the last time an American President was sufficiently independent of the elitist powers behind the scenes to publicly warn American citizens of the dangers to their freedoms and livelihood. Here is an extract from Jackson's final message to the American people: The distress and alarm which pervaded and agitated the whole country when the Bank of the United States waged war upon the people in order to compel them to submit to its demands cannot yet be forgotten. The ruthless and unsparing temper with which whole cities and communities were oppressed, individuals impoverished and ruined, and a scene of cheerful prosperity suddenly changed into one of gloom and despondency ought to be indelibly impressed on the memory of the people of the United States. If such was its power in a time of peace, what would it not have been in a season of war, with an enemy at your doors? No nation but the free men of the United States could have come out victorious from such a contest; yet, if you had not conquered, the government would have passed from the hands of the many to the few, and this organized money power, from its secret conclave, would have dictated the choice of your highest officials and compelled you to make peace or war, as best suited their own wishes. (6) Even while Jackson wrote this message to the American people our government had passed "from the hands of the many to the hands of the few." Moreover, the few "from its 22 Andrew Jackson: The Last Anti-Elitist President secret enclave" was already dictating political choices, boom and slump and war and peace. In the United States the Jacksonian Democrats, the Whig tradition in American politics, were the last remnant that knew and understood the power behind the scenes. Across the Atlantic in England the Cobdenites under Richard Cobden and John Bright tried to maintain a similar torch of individual freedom. They also failed. As Jackson wrote his last message, socialist manifestos were being weighed and put to paper. Not to improve the lot of the common man as they would have us believe, but as devices to gain political power for the elite. 23 The Federal Reserve Conspiracy Endnotes to Chapter Three (1) Bray Hammond, Banks and Politics in America, (Princeton University Press, Princeton, 1957) p. 405. It is noteworthy that Princeton, one of the Ivy League schools, is a scholastic base of the "establishment" and helps perpetuate this onesided historical interpretation. (2) James A. Hamilton, Reminiscences, p. 149. (3) John Spencer Bassett, ed., Correspondence of Andrew Jackson, (Carnegie Institution, Washington, D.C., 1929-32) vol. 4, p. 389. (4) Ibid., p. 271. Jackson was not a skilled writer. He was a man of action and principle rather than a man of letters. However, his points are clearly there for those with eyes to read. (5) Ibid., p. 92. (6) Richardson's Messages, Vol. 4, p. 1523. 24 Chapter Four: ROOSEVELT'S SOCIALIST MANIFESTO
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