FRENZIED FINANCE -- III
[Synopsis of *Frenzied Finance* by Thomas
W. Lawson. New York: Ridgway-Thayer, 1905]
-+- The Power of Dollars -+-
At no time in the history of the United States has the power of
dollars been as great as now. It is possible today (1905), with
dollars, to "steer" the selection of the candidates of both the
great parties for the office of President of the United States.
It is possible to repeat the operation in the selection of
candidates for the executive and legislative offices of every
State and municipality in the United States, and with a
sufficient number of dollars to "steer" the doings of the
law-makers and law-enforcers of the national, State, and
municipal governments, and to "steer" a sufficient proportion of
the court decisions.
I SHALL GO FURTHER AND SAY THAT THERE TODAY EXISTS UNCONTROLLED
IN THE HANDS OF A SET OF MEN A POWER TO MAKE DOLLARS FROM
Today (1905) "Standard Oil," the "Private Thing," is the greatest
power in the land, and its secret is the knowledge of the trick
of finance by which dollars are "made" from nothing.
The "Private Thing" is uncontrolled by any of the restrictions by
which the law defines and curbs the corporation whose name it
bears. Already I have distinguished between "Standard Oil" which
wields all the powers of its subsidiary companies, and Standard
Oil, the seller of oil. [See CN 11.10]
Let us suppose that the U.S. government puts forth a particular
$10,000. "Farmer Bob" receives, by the sale of his wheat, that
$10,000. He then deposits it in *The Bank*. At this stage
enters the *Private Thing*.
The *Private Thing* borrows $3,300 of Farmer Bob's money from
*The Bank*. The *Private Thing* purchases a copper mine with the
money, and deposits the title with *The Bank* as collateral for
the $3,300 loan. Then the *Private Thing* declares that the
copper mine is worth $10,000. (The actual cost, $3,300, is kept
secret.) The *Private Thing* issues to himself a piece of paper
stamped "10,000 stock dollars." The *Private Thing* takes the
"10,000 stock dollars" to *The Bank*, and exchanges it for the
remaining $6,700 belonging to Farmer Bob.
At this stage there is actually in use among the people $16,700
-- $10,000 which is recorded, known, and legal, being used by
Farmer Bob and *The Bank*, and $6,700 which is unrecorded and
unknown to any but the *Private Thing* and *The Bank*. Right
here is the secret device, the financial trick.
In the next step, the *Private Thing* sells his $3,300 -- stamped
as "10,000 stock dollars" -- to Farmer Bob for his *real*
$10,000. Farmer Bob withdraws the money from *The Bank* by
simply making out a check in favor of the *Private Thing*.
(Farmer Bob is told the "10,000 stock dollars" will yield a
higher rate of interest than *The Bank* can afford to pay.) The
*Private Thing* deposits Farmer Bob's check with *The Bank*,
thereby eliminating its $10,000 debt to *The Bank*.
At this point, Farmer Bob still has $10,000, but it is "10,000
stock dollars." The *Private Thing* is the possessor of $6,700,
and "Mr. Miner" (from whom the copper mine was purchased) is the
possessor of $3,300. *The Bank* remains where it was at the
Agents of the *Private Thing* -- Wall Street and the press --
carefully educate the people to believe that their country is
tremendously prosperous. Its "prosperity" is evidenced by the
$6,700 added wealth in the form of 6,700 new stock dollars!
At the next stage the financial trick accomplished by the secret
device is complete. At the next growing season, Farmer Bob wants
to buy $10,000 worth of seed and machinery. But the *Private
Thing* knows that Farmer Bob's "10,000 stock dollars" are only
worth $3,300 and will not sell; the true value of the stock
dollars is proclaimed, and Farmer Bob is compelled to sell his
stock dollars for whatever the *Private Thing* is willing to pay.
By this operation, Farmer Bob has lost $6,700 of his own making,
and the *Private Thing* has "made" $6,700 in real dollars. *The
Bank* has been the instrument by which the *Private Thing* has
deprived Farmer Bob of his savings, because the *Private Thing*
and *The Bank* are one and the same.
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