Richard C. Cook: Market Fundamentalism and the Tyranny of Money


Richard Moore

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³Market Fundamentalism² and the Tyranny of Money
Recommendations for Reform of the US Monetary System

By Richard C. Cook

Global Research, November 25, 2007

We hold these truths to be self-evident, that all men are created equal,

that they are endowed by their Creator with certain unalienable rights,

that among these are life, liberty and the pursuit of happiness.

1. What We Must Do Today

³Life, liberty, and the pursuit of happiness² are, or should be, the fruits of 
democracy. But the political democracy defined by the Declaration of 
Independence and the Constitution has not been achieved because economic 
democracy has not been achieved. The attainment of real economic democracy is 
the next task for the American people.

In the midst of the most productive economy in history, the U.S. and much of the
world today are in crisis, with stagnant or falling incomes, rising prices, and 
skyrocketing debt. Many experts are predicting an economic collapse, and people 
with money are scrambling for safe places to protect it. No one in an official 
capacity has provided a convincing explanation; few have even tried.

We are taught that economics is a ³science² and that it operates under 
unchangeable laws that are understandable only to specialists. People speak with
reverence of ³market forces² as existing beyond the reach of human intelligence 
and will.

None of this is true. There is no such thing as ³laws² in economics.

Of course there are plenty of habits and conventions, myths and prejudices. But 
the ³laws² are the ones created by governments, usually under the control of 
powerful people who work the levers of power to acquire greater wealth through 
legislative favor. These laws are man-made. In some cases the laws may provide 
benefits to those who work for a living, but in many cases not. What we forget 
is that any of these laws can be changed and that many of them should be 

Besides, haven¹t we learned by now that what has aptly been called ³market 
fundamentalism² is really shorthand for the tyranny of money? It is a fact that 
control of economic life, at least in most of the Western nations, has been 
turned over to the monetary elite who control the world¹s industry and resources
through the private issuance of credit that originates from the privilege of 
fractional reserve banking.

This vestige of the financial systems of the Middle Ages allows the banks to 
produce credit ³out of thin air² and lend it at a profit. They lend to 
consumers, businesses, investors, speculators (such as hedge funds), and to 
federal, state, and local governments. Under the banking laws, they generate 
this credit against a small ³reserve base² consisting of customer deposits, 
government debt, overnight deposits from corporations and government agencies, 
and even‹as has been well-documented‹by laundering the proceeds of drug dealing 
and other types of crime.

The dependence of economic life on debt has assured that there has been a steady
flow of wealth from the producing economy of goods and services into the 
financial web which surrounds it. Debt from lending at interest grows at an 
exponential rate.

Further, every period of economic growth in the last generation has been largely
a bank-created bubble. Each time a bubble bursts, the financiers gain more 
wealth by buying assets at bankruptcy prices. The latest is the housing bubble.

Now we are about to see the bursting of an even larger bubble consisting of 
stocks and other business assets. In fact, the financiers are now positioning 
themselves to take advantage of a broad economic collapse.

Control of wealth by high finance is the main reason the bounty of science and 
technology has not assured a better life to the majority of the people of the 

Politicians stand by and do nothing. In fact their campaigns are financed by the
monetary elite. Should any of them mention economic themes that are even 
remotely ³populist,² they are immediately denounced by the financier-controlled 

Despite the power of industrial processes which have the capability of providing
a decent living to everyone in the world‹contrary to the myth of global 
overpopulation‹the world still lives under an illusion of scarcity. This tends 
to justify the senseless struggle for wealth and control of resources. But it¹s 
one of the most glaring examples of the condition of mass hypnotism that has 
weighed humanity down throughout the ages.

Ethically, the illusion of scarcity leads to the law of the jungle, survival of 
the fittest, the fight for dominance and supremacy. ³Economic man² still lives 
at the animal level. The higher laws of human ethics, including the injunction 
to ³love our neighbors as ourselves,² have been ignored. But they need not be 
ignored if we wake up to the fact that we have it in our power to live in a much
different and better world.

The present situation is just as harmful to the wealthy who hold their fellow 
human beings in bondage as it is to the debtors they oppress, for the rich as 
well are deprived of the benefits of living in a world where human beings are 
free, happy, generous, and productive.

One answer to the problem is monetary reform, combined with the realization that
science and technology have removed the need for everyone to work all the time 
just to survive. We have earned the ³leisure² and ³peace² dividends that are 
often mentioned but have yet to be realized.

For the last eight months I have been publishing essays on these themes on 
Global Research and other internet sites. I was inspired to write and publish 
these essays after I retired from the U.S. Treasury Department following 
thirty-two years of working for the federal government.

My research showed that the U.S. actually had a reasonable approach to monetary 
matters for much of our history. The thirteen American colonies built a dynamic 
economy without the presence of a single bank. Throughout the nineteenth 
century, we developed the most powerful economy on earth without a large 
national debt.

Then Congress gave away its constitutional authority over money through the 
Federal Reserve Act of 1913. The Sixteenth Amendment to the Constitution which 
was enacted the same year, created an income tax to pay the interest on the 
national debt. Throughout history, government debt and excessive military 
spending have gone hand-in-hand. Not accidentally, the Federal Reserve Act 
marked the beginning of the century of world war that still afflicts us.

We now need to reclaim our monetary system before our government makes the fatal
error of engaging in more useless foreign wars, besides the travesty in Iraq, 
because they continue to think that the way to solve our internal monetary 
problems is taking other people¹s land and resources. This is another effect of 
the illusion of scarcity.

A lifetime of involvement in public finance with the federal government has led 
me to call for one basic reform.

We should abolish the privately-controlled Federal Reserve as a bank of issue 
and re-establish constitutional control of credit as a public utility. Public 
creation of credit would be reflected in two basic policies: 1) direct issuance 
of credit to citizens through a basic income guarantee, a periodic National 
Dividend, and low-interest bank lending; and 2) direct spending by government 
for essential services‹i.e., restoring the Greenback‹combined with public 
low-interest financing of infrastructure investment. Taking these steps would 
also allow us to reduce much of the onerous burden of taxation at the federal, 
state, and municipal levels.

Also, people who advocate a gold standard are often confused about the 
definition of ³fiat money,² which they deride. There are actually different 
types of ³fiat money.² The debt-based credit created by the Federal Reserve, 
often called ³fiat money,² is not money at all. It is simply temporary credit 
with a lien against it for repayment with interest. But real ³fiat money,² like 
the Civil War Greenbacks or the American colonial paper currency, was true 
democratic money that was spent into circulation by government and was never 
inflationary. Rather it allowed commerce to expand and people to prosper. This 
type of fiat money is actually the key to economic democracy.

II. Monetary Reform Recommendations

The articles compiled in the essays referenced above contain numerous 
recommendations for actions that would restore the issuance and management of 
credit as a public utility under the Commonwealth of American citizens as 
established by the U.S. Constitution. Following is a comprehensive list of 

The immediate purpose of this program would be to correct the conditions that 
have brought us to the brink of economic catastrophe due to the cession of 
control over credit by Congress to the private financier elite through the 
Federal Reserve Act of 1913.

The unconstitutional abdication of monetary responsibility by Congress has 
contributed directly to a century of world war, the near-destruction of the U.S.
as a constitutional republic, and the transfer of much of the nation¹s wealth 
into the hands of the monetary controllers who have acquired it through 
inflating and deflating financial bubbles, by mis-using their fractional reserve
banking privileges.

The recommendations which follow would be a start in bringing about change. A 
few of them have been suggested by some of the 2008 presidential candidates, 
though none of the candidates from either party has presented anything close to 
a program this comprehensive. The recommendations are divided into immediate, 
near-term, and long-term actions. Note that monetary reform will make possible a
large number of additional economic and political changes, including a 
transformation of the military posture of the U.S., since we no longer will have
to fight the rest of the world to compensate for our monetary weaknesses.


€ Abolish the Federal Reserve as a bank of issue and reconstitute it as a 
financial processing bureau servicing the public and private financial sectors 
under the authority of the U.S. Treasury Department.

€ Place all U.S. monetary operations under a Monetary Control Board that shall 
operate as a federal regulatory agency under the administrative supervision of 
the U.S. Treasury Department.

€ Abolish Federal Reserve open market operations by authorizing credit directly 
issued by the U.S. Treasury as collateral for all U.S. bank lending.

€ Restore private banking operations in the U.S. to the ³real bills² doctrine 
and abolish all lending for financial asset and securities speculation.

  € Outlaw hedge funds.
  € Replace all Federal Reserve notes by U.S. Treasury certificates.

  € Place the entire U.S. national debt under bankruptcy reorganization.

€ Authorize the executive branch to begin direct Greenback-type funding of 
selected operational programs.

€ Establish a self-collateralized Federal Infrastructure Bank to lend to state 
and local governments for long-term projects at zero percent interest.

  € Restore the pre-2005 federal personal bankruptcy law.

€ Utilize an off-budget national credit account to issue an annual guaranteed 
basic income to all legal U.S. residents in the amount of $10,000 per adult and 
$5,000 per dependent child.

€ Establish a National Price Commission to work toward a system-wide fair 
pricing policy for the U.S.

€ Freeze budgets and hiring for all federal government agencies, including the 
military and all contractors.


€ Establish policies to maintain a stable dollar with minimal inflation 

€ Adopt as a primary monetary goal the backing of our currency with domestic 
production within the physical economy rather than the ³print, loan, charge, and
spend² policy of bank-centered monetarism.

€ Extend the authority of the Securities and Exchange Commission to investigate 
and eliminate predatory financial practices within U.S. capital markets that are
destructive to U.S. industry, infrastructure, and labor.

€ Use the findings of the National Price Commission to establish an annual 
National Dividend that provides citizens with their rightful benefits accruing 
from the appreciation of national productive capacity through the application of
science and technology to productive processes. The National Dividend shall 
utilize the amount of the guaranteed basic income as a floor in calculating 
benefits and shall consist in both direct payments to citizens and pricing 
subsidies for products sold in U.S. markets.

€ Establish a new federal agency to oversee and regulate mortgage funding, 
assure low-interest lending for housing, and protect the housing markets from 
predatory financial practices, including the inflation and deflation of housing 

€ Assure funding and legislative support to implement energy-conservation 
actions such as those contained in the 2005 report of the Rocky Mountain 
Institute entitled, ³Winning the Oil End-Game: Innovation for Profits, Jobs, and

€ Provide increased federal R&D funding for hydrogen technologies and for 
technologies that replace the internal combustion engine.

  € Provide funding for free college-level education for all U.S. citizens.

€ Reverse privatization of public utilities and re-regulate on a fair-price 

  € Protect and extend union collective bargaining rights.
  € Restore public service requirements for media broadcasting.

€ Establish public funding for all U.S. elections along with mandatory free air 
time for political candidates.

€ Depoliticize all agencies of the executive branch from undue corporate 
influence in decision-making and establish new and meaningful programs of public
access and participation.

€ Establish federal support mechanisms allowing community banks to provide 
low-interest loans at one percent interest to small businesses and consumers.

€ Utilize a federal-state partnership to establish a series of ten regional 
mega-universities within the United States to serve both U.S. and international 
student audiences.

€ Reconstitute the federal budget by eliminating programs supplanted by the 
guaranteed basic income, utilization of direct Greenback-type funding where 
appropriate, and selective users¹ fees.

€ Eliminate collateralization of private sector banking with federal debt 
securities. Emergency borrowing by the federal government will take place only 
through direct sale of Treasury bonds.

€ Eliminate all federal, state, and municipal income taxes and replace with a 
national sales tax.

€ Establish a mandatory annual income ceiling for individuals and corporations.

€ Establish a mandatory national building and zoning code that provides for 
affordable housing, use of renewable energy resources, and expanded mass 

  € Recreate and revitalize the nation¹s railroads.

€ Establish a system of universal health care that draws heavily on concepts of 
lifestyle and prevention.

€ Establish meaningful programs of center city renewal to transform ³death 
zones² into vibrant centers of urban culture.

€ Abolish the International Monetary Fund, the World Bank, the World Trade 
Organization, and the North American Free Trade Association and replace them 
with an international monetary authority under the U.N. whose function is to 
regulate international currency exchange to the mutual benefit of all parties.

  € Place all outstanding loans by the IMF under bankruptcy reorganization.

€ Support models of sustainable economic development among developing countries.

  € Begin the withdrawal of U.S. military forces from overseas bases.
  € Outlaw all covert warfare carried out by U.S. government agencies.

€ Eliminate all military programs of domestic surveillance and all overseas 
surveillance, detention, and torture contrary to established international law.

  € Reduce U.S. arms sales abroad to essential defense requirements.

  € Eliminate all U.S. funding of mercenary or contractor military forces.

€ Reconstitute the CIA and NSA as supporters of a defensive military posture and
depoliticize their operations in order to assure accurate professional 
data-gathering and analysis.

€ Reconstitute the State Department as an agency to support the democratic 
aspirations of the people of the world.

  € Eliminate the entire U.S. national debt.
  € Carry out a general demilitarization of American culture.

€ Reduce the military budget by elimination of wars of ³choice,² abandonment of 
³full spectrum dominance,² and restoration of a military devoted to 
multilateralist defense of the U.S.

€ Work with the nations of the world on establishing democratic economic systems
based on the utilization of credit as a public utility in accordance with U.S. 
constitutional traditions.

€ Undertake reclamation and desalination programs to bring water supplies to 
drought-stricken areas.

€ Accomplish a permanent long-term conversion to renewable energy sources, 
including water-fueled hydrogen cells suitable to provide all power needs for 
homes and businesses.

€ Refocus the U.S. space program on activities that support space science and 
the economic development of space resources.

III. Conclusion

One final recommendation could be made, which would be to restore to our 
citizens the money they have been forced to borrow during their lifetimes rather
than enjoy the benefit of a National Dividend which could have been implemented 
decades ago. At a current estimated value of over $12,000 per year, the lifetime
amount would average around $500,000 per adult. This figure represents the 
amount of debt we have had to incur, not including interest, due to a financial 
system that benefits the monetary controllers, not the people of the nation.

As monetary reformers of the past have affirmed, a program like this represents 
a spiritual vision. It cannot be achieved by moving pieces around on an economic
or political chessboard. It requires a new way of looking at humanity‹as 
individuals, who, like oneself or one¹s family or one¹s nation or those of one¹s
religion, also have a right to a life of abundance and security on the planet 

This abundance and security are both available, not by accumulating money, 
power, or influence, but by looking to the spirit within and allowing the 
splendor of that vision to manifest in the outer world. This vision was 
reflected in ideals of our republic expressed in the Declaration of Independence
and the Constitution, and is now reflected in the program of reform described by
monetary reformers both past and present.

Of course no one can say how much more time must pass before such a program can 
be implemented. The illusion of scarcity has society in a stranglehold. Will it 
take a nuclear war to get us to wake up? A worldwide revolution? Catastrophes 
from pollution or global warming?

For now, enlightened individuals must do the best they can to acquire and 
maintain a spiritual perspective and be prepared for the time when conditions 
ripen. Measures such as getting out of debt, creating local currency/barter 
systems, forming conscious communities, and acquiring manual skills are some of 
the economic actions people can take to protect themselves.

Also, people can take action through their state and local governments. Before 
the Civil War we had state-owned banks. During the Depression, cities 
experimented with their own currencies. The states could even initiate a 
constitutional convention to amend the Constitution to restore citizens¹ 
monetary control.

Finally, don¹t feel badly about being in debt and wanting to get out. Almost 
everyone is in debt to some extent, millions of people are over their heads in 
debt, and the situation is going to get worse.

But remember that before long, monetary reform based on public control and 
issuance of credit will be recognized as the most fundamental requirement of 
economic democracy and will be implemented. It¹s been said that the tyranny of 
money ³is the last tyranny.² Eventually the time may come when we will be more 
developed spiritually and perhaps won¹t even need money anymore.

Then people will be able to walk into any store and take what they need, free 
for the asking. We¹ll do what work is required just for the enjoyment and 
adventure of it. No one will desire what another has because we finally will 
have understood that the bounty of God¹s universe is infinite. That will be the 
ultimate monetary reform.

Richard C. Cook is a retired federal analyst, whose career included service with
the U.S. Civil Service Commission, the Food and Drug Administration, the Carter 
White House, and NASA, followed by twenty-one years with the U.S. Treasury 
Department. His articles on economics, politics, and space policy have appeared 
on numerous websites. He is the author of Challenger Revealed: An Insider¹s 
Account of How the Reagan Administration Caused the Greatest Tragedy of the 
Space Age, called by one reviewer, ³the most important spaceflight book of the 
last twenty years.² His website is at

Disclaimer: The views expressed in this article are the sole responsibility of 
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