Debt-Free United States Notes Were Once Issued Under JFK And The U.S. Government Still Has The Power To Issue Debt-Free Money

"If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good makes the bill good." Thomas Edison

Debt-Free United States Notes Were Once Issued Under JFK And The U.S. Government Still Has The Power To Issue Debt-Free Money

Ben Franklin's views on monetary policy still resonate today

I just finished reading an essay entitled "Benjamin Franklin and the Birth of a Paper Money Economy," written by Professor Farley Grubb, based upon a lecture he gave at the Federal Reserve Bank of Philadelphia on March 30, 2006.

"In 1765, in response to Lord Grenville's challenge to come up with some palatable way for the British to increase taxes on the colonists to help pay for the Seven Years War, Franklin writes up a proposal for a North-America-wide universal paper currency modeled on Pennsylvania's land bank system. The British would run the colonial land bank and collect the interest on the paper money loaned out to colonists in place of any new direct taxes placed on the colonists."

Isn't this interesting that the colonists would consider allowing the British to issue paper money and collect interest on it in place of direct taxation? It is my understanding that today we allow the banks to issue paper money and collect interest on it, but this does not go to fund our government, but to only to deliver super-sized profits to the banks. The government must collect taxes in addition to the citizens subsidizing the banks through their charter to issue money.

Franklin also write in "Of the Paper Money of America" that the depreciation of the Continental dollar operated as an inflation tax or a tax on money itself. Again, today we all pay a steep inflation tax, presumably paid to the issuing banks, as well at being taxed directly at almost every turn.