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The Lazy Man’s Guide to the Economic Crisis
Although the money masters tend to obfuscate the facts (like that famous wizard hiding behind the curtain), the economic disaster we are experiencing is really pretty simple to comprehend. For the lazy man, here is your down-and-dirty primer to the economic crisis.
Back in 1913, the Federal Reserve Act was enacted. Woodrow Wilson, one of the culprits behind the Act, later said apologetically, "I am a most unhappy man; unwittingly I have ruined my country."
Why did he say that? Because, with the implementation of the Federal Reserve Act, no longer was the government able to issue its own money as the Constitution directs. The privately held Federal Reserve became the issuer of currency, and charged interest to the United States government for doing so – which only benefited the bankers, not the people. Read: huge national debt.
In 1913, Congressman Charles August Lindbergh, Sr., said of the Federal Reserve Act: "This Act establishes the most gigantic trust on Earth . . . The new law will create inflation whenever the Trusts want inflation . . . From now on, depressions will be scientifically created . . . The worst legislative crime of the ages is perpetrated by this banking and currency bill."
The final nail was driven into the country’s financial coffin when Nixon abolished the gold standard in 1971. As Lindbergh had warned, the Fed then created inflation cycles in order to absorb the savings of Americans. Former Federal Reserve Chairman Alan Greenspan: “In the absence of the gold standard, there is no way to protect savings from confiscation through inflation . . . Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights . . .”
Since 1971, we have been operating in a fiat currency system, meaning that our paper currency has no backing by gold or anything else to give it value. It is essentially worthless.
Greenspan’s words about confiscating our wealth have come true. We have experienced a hi-tech bubble, a housing bubble, and so on, each designed to siphon more and more of the nation’s wealth into the hands of big banks and corporations.
Greed Comes Home to Roost
The voracious appetite of the Wall Street gamblers was on full display when they began speculating in derivatives, exquisitely timed with the housing bubble. Mortgage brokers would close loans, then package them and sell them off to Wall Street, where they sprouted new lives in various “exotic investment instruments” (mortgage-backed securities). These newfangled investment products grew tentacles all over the world, mostly resulting in worthless paper held by numerous investors far and wide.
By some estimates, the dodgy derivatives add up to, at minimum, over one quadrillion dollars. That amount of debt is simply not sustainable. This enormous, widespread debt is the cause of bank and corporate insolvency across the globe – and in your town.
Money and Markets expert Martin D. Weiss, Ph.D., says we are now reaching the “panic phase of the collapse,” which is an acceleration of the economic decline. Weiss thinks the government’s economic rescue efforts are doomed to fail miserably. Says Weiss: “The dangerous, unintended consequences of the government’s rescue efforts can only deepen, broaden and prolong the economic decline.“
A Race to the Bottom
In an article by Paul Craig Roberts (“How the Economy Was Lost”), he explains how the offshoring of jobs helped to create a lower tax base for American communities. Because US workers could no longer keep their IT and software engineering jobs due to 1) offshoring and 2) foreign workers coming in on H-1b work visas, our highly trained technical workers’ salaries plunged. In addition, corporations began a mass exodus of manufacturing jobs to foreign lands, thus creating a new wave of unemployment among skilled American laborers as well.
Business pundits such as Microsoft’s Bill Gates jumped on the bandwagon to decry the lack of skilled Americans, thus opening the floodgates for large numbers of foreign workers to take over the jobs of competent Americans.
Roberts says, “Chasing after shareholder return and ‘performance bonuses,’ US corporations deserted their American workforce. The consequences can be seen everywhere.”
He adds, “Doing a good job, providing a good service, is no longer the corporation’s function. Instead, the goal is to minimize labor costs at all cost. “
Indeed, Alan Greenspan tells us (Dallas Morning News, 2/14/2008): "Significantly opening up immigration to skilled workers solves two problems: The companies could hire the educated workers they need. And those workers would compete with high-income people, driving more income equality.” In other words, lowering the American people’s standard of living by unmercifully slashing their wages.
In fact, Greenspan unequivocally stated during a 2008 Democracy Now! interview that Americans made too much money.
Taking Greenspan at his word, we can surmise that one of the goals of the ruling elites is to even the global playing field by reducing the wages of hard-working Americans, by now in a desperate race to the bottom. No more discretionary income, no more annual trips to the beach. Instead, as a wage slave, chained to an ever-turning wheel of mis-fortune, stands the American worker – oblivious to the hidden hand of events even as it operates right in front of his nose.
KATHY SANBORN is an author, journalist, and recording artist with a new CD, Peaceful Sounds, now a top seller on CDBaby. Listen to clips of her songs, including “Forever War,” and buy the album now at http://cdbaby.com/cd/kathysanborn.
© 2009 KATHY SANBORN