Ellen Brown: Reform of the US Monetary System!
The you-tube video of 12 year old Victoria Grant speaking at the Public Banking in America conference last month has gone viral, topping a million views on various websites. Monetary reform is the contention that governments, not banks, should create and lend a nations money has rarely even made the news, so this is a first. Either the times they are a-changing, or Victoria managed to frame the message in a way that was so simple and clear that even a child could understand it. Basically, her message was that banks create money out of thin air and lend it to people and governments at interest. If governments borrowed from their own banks, they could keep the interest and save a lot of money for the taxpayers. She said her own country of Canada actually did this, from 1939 to 1974. During that time, the governments debt was low and sustainable, and it funded all sorts of remarkable things. Only when the government switched to borrowing privately did it acquire a crippling national debt. Borrowing privately means selling bonds at market rates of interest, which in Canada quickly shot up to 22%, and the money for these bonds is ultimately created by private banks. For the latter point, Victoria quoted Graham Towers, head of the Bank of Canada for the first twenty years of its history. He said: Each and every time a bank makes a loan, new bank credit is created, new deposits brand new money. Broadly speaking, all new money comes out of a Bank in the form of loans. As loans are debts, then under the present system all money is debt. Towers was asked. Will you tell me why a government with 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?