From backed money to freshair loaned forward at interest

^{Robert H. Hemphill, Credit Manager of the Federal Reserve Bank of Atlanta in the Great Depression, wrote in 1934:}

^{“We are completely dependent on the commercial Banks. Someone has to borrow every dollar we have in circulation, cash or credit. If the Banks create ample synthetic money we are prosperous; if not, we starve. We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless position is almost incredible, but there it is. It is the most important subject intelligent persons can investigate and reflect upon.”}

^{In the Foreword to Irving Fisher, 100% Money (1935), reprinted by Pickering and Chatto Ltd. (1996).}

^{http://www.webofdebt.com/articles/dollar-deception.php}

^{- On September 30, 1941, a revealing exchange took place between Mr. Wright Patman (left), Chairman of the U.S. House of Representatives Banking and Currency Committee, and Mr. Marriner Eccles (right), Chairman of the Federal Reserve Board (the central bank of the U.S.A.) concerning a $2 billion monetary issue which the Bank created:}

^{Mr. Patman: “How did you get the money to buy those $2 billion of Government securities?”}

^{Mr. Eccles: “We created it.”}

^{Mr. Patman: “Out of what?”}

^{Mr. Eccles: “Out of the right to issue money, credit.”}

^{Mr. Patman: “And there is nothing behind it, except the Government’s credit?”}

^{Mr. Eccles: “We have the Government bonds.”}

^{Mr. Patman: “That’s right, the Government’s credit.”}

^{Solution: debt-free money created by society}

^{This puts us on the right track for a solution to the debt problem: if these bonds are based on the Government’s credit, why would the Government have to go through the banks to use its own credit?}

^{It is not the banker who gives value to money, but the credit of the Government, of society. The only thing the banker does in this transaction is to make an entry in a ledger, writing figures which allow the country to make use of its own production capacity, its own wealth.}

^{Money is nothing else but that: a figure — a figure which is a claim on products. Money is only a symbol, a creation of the law, according to Aristotle’s words. Money is not wealth, but the symbol that gives rights to wealth. Without products, money is worthless. So, why pay for figures? Why pay for something which costs nothing to make?}

^{And since this money is based on the production capacity of society, this money also belongs to society. Then, why should society pay the bankers for the use of its own money? Why pay for the use of our own goods? Why doesn’t the Government issue its own money directly, without going through the banks?}

^{Even the first Governor of the Bank of Canada admitted that the Federal Government had the right to issue its own money. Graham Towers, who was Governor of the Bank from 1935 to 1951, was asked the following question, before the Canadian Committee on Banking and Commerce, in the spring of 1939:}

^{Question: “Will you tell me why a government with the power to create money should give that power away to a private monopoly and then borrow that which parliament can create itself, back at interest, to the point of national bankruptcy?”}

^{Towers’ answer: “Now, if parliament wants to change the form of operating the banking system, that is certainly within the power of parliament.”}

^{http://www.michaeljournal.org/plenty34.htm}