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I'd add that this system is used the world over. Every western nation uses a variation of the same system.
We should adopt an amendment that makes the 'debt' we 'owe' the Fed non-payable. After all, the 'money' was created out of thin air. Use the Fed as an accounting system. Pay their salaries, but make the 'debt' non-payable.
The U.S. government does not issue U.S. currency - the Federal Reserve does.
The Federal Reserve is a private bank owned and operated for profit by a very powerful group of elite international bankers.
If you will pull a dollar bill out and take a look at it, you will notice that it says "Federal Reserve Note" at the top.
It belongs to the Federal Reserve.
The U.S. government cannot simply go out and create new money whenever it wants under our current system.
Instead, it must get it from the Federal Reserve.
So, when the U.S. government needs to borrow more money (which happens a lot these days) it goes over to the Federal Reserve and asks them for some more green pieces of paper called Federal Reserve Notes.
The Federal Reserve swaps these green pieces of paper for pink pieces of paper called U.S. Treasury bonds. The Federal Reserve either sells these U.S. Treasury bonds or they keep the bonds for themselves (which happens a lot these days).
The whole Federal Reserve System was designed to slowly drain the massive wealth of the American people and transfer it to the elite international bankers.
It is a game that is designed so that the U.S. government cannot win. As soon as they create more money by borrowing it, the U.S. government owes more than what was created because of interest.
If you owe more money than ever was created you can never pay it back.
That means perpetual debt for as long as the system exists.
It is a system designed to force the U.S. government into ever-increasing amounts of debt because there is no escape.
We could solve this problem by shutting down the Federal Reserve and restoring the power to issue U.S. currency to the U.S. Congress (which is what the U.S. Constitution calls for). But the politicians in Washington D.C. are not about to do that.
So unless you are willing to fundamentally change the current system, you might as well quit complaining about the U.S. national debt because it is now mathematically impossible to pay it off.
Why does any government entity borrow money? The conventional economic justification for borrowing is based on life-cycle. You borrow for things like education and housing when you're young because it's a way of compensating for your abject poverty at age 20 and expected well-off status at age 40-50.
Government does not have that same expected life cycle--it goes on and on. Why does gov't borrow anything, unless to pay off the bankers and bond lawyers, who incidentally are generous campaign contributors.
For a moment, imagine that there is a privately-owned organization in the United States that can create U.S. dollars out of thin air whenever it wants and can loan that money to whoever it wants to.
Imagine that this organization is able to act with the full power of the U.S. government behind it, but that nobody in the organization is ever elected by the American people, and that for all practical purposes the organization is not accountable to the president or to Congress.
Imagine that the organization is able to make trillions of dollars of secret loans to banks, to foreign governments and even to their close friends without ever having to face a comprehensive audit.
Does that sound preposterous?
Well, such an organization actually exists.
It is called the Federal Reserve, and today we found out that once again the Fed is going to be taking huge piles of your money and loaning it to commercial banks in Europe.
And they're just pocketing that money. Oh wait, no they're not...
You really need to learn the point of central banking and it's not to take your money as fast as you'll give it to them. In fact it's to keep you from having to eat your children to stay alive because that evil rich person really did take it from you so they can have another billion.
If you were locked in a room with nine other people and $1,000 and no way to add any more money you'd be one SOL sucker...
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