1694 – ROYAL CHARTER GRANTED TO THE BANK OF ENGLAND
King William II (William of Orange) created the privately owned central bank via a charter (a license to exist) out of urgency. England needed to rebuild its navy to counter the French, but the sovereign King William II lacked the money or credit. He traded his exclusive right to create money to the private bank. The bank raised money from shareholders, which was loaned to the King at interest. The bank also created money out of nothing. As William Patterson, the bank’s co-founder and early Director, said, “The bank hath benefit of interest on all moneys which it creates out of nothing.” The bank is located in the 1 square mile City of London, a separate city within the larger London municipality.
2012 – NATIONAL ASSOCIATION OF LETTER CARRIERS ADOPS A RESOLUTION AT THEIR NATIONAL CONVENTION TO INVESTIGATE ESTABLISHING A POSTAL BANKING SYSTEM
The resolution noted that expanding postal services and developing new sources of revenue are important to the effort to save the public Post Office and preserve living-wage jobs; that many countries have a successful history of postal banking, including Germany, France, Italy, Japan, and the United States itself; and that postal banks could serve the 9 million people who don’t have bank accounts and the 21 million who use usurious check cashers, giving low-income people access to a safe banking system. “A USPS bank would offer a ‘public option’ for banking,” concluded the resolution, “providing basic checking and savings – and no complex financial wheeling and dealing.” At one time, the Postal Savings System offered savings accounts to depositors, but no loans. When banks failed after the Great Depression, many people shifted their remaining funds. The Postal Savings System held upwards of 20% of the nation’s savings in the mid 1940’s. Commercial/corporate banks opposed the efficient system (post offices served as bank branches) and lobbied for their limitation and finally elimination, which occurred in 1967. One wonders to what extent current efforts to eliminate the Post Office are based on eliminating this legitimate alternative to private banking corporations.
1919 – BANK OF NORTH DAKOTA FOUNDED
The Bank of North Dakota is the only state-owned bank in the US. Its primary deposit base is the State of North Dakota. All state funds and funds of state institutions are deposited with the Bank, as required by law. Other deposits are accepted from any source, private citizens to the U.S. government. No tax dollars are used to pay interest to bond holders since the state has no debt.
2014 – PUBLISHED POLL OF UK PARLIAMENT MEMBERS SHOWING THEIR INGORANCE OF MONEY CREATION
100 MPs were polled through Dods Monitoring in July 2014. MPs were asked to read a number of statements and indicate whether they were true or false. They could also select “Don’t know”. In response to the statement “Only the government – via the Bank of England or Royal Mint – has the authority to create money, including coins, notes and the electronic money in your bank account.”, 71% said this was true, 20% said it was false (the correct answer) and 9% said they didn’t know. There was no significant difference between the parties. In response to the statement “New money is created when banks make loans, and existing money is destroyed when members of the public repay loans.”, only 12% of MPs gave the correct answer: true. 64% of MPs said this was false, while 24% said they didn’t know. The full results can be found at http://bit.ly/1qTZHHa
2011 – PUBLICATION OF ARTICLE “YOU CAN’T SOLVE THE DEBT CRISIS WITH MORE DEBT” BY BEN DYSON, DIRECTOR, POSITIVE MONEY
“We cannot solve a debt crisis by adding more debt.
It`s a fact that seems to have been completely missed by the IMF, European Union and our own government.
The solution to Greece? More debt. The solution to the US government`s inability to fund two simultaneous wars from tax revenue: more debt. The solution to the high indebtness of ordinary people in the UK? Get banks lending again: let`s have more debt.
What we need now is not more debt, but less of it.
But for the economic mainstream and those young and inexperienced civil servants who are deciding how to fix one of the largest banking systems in the world, it seems perfectly normal to let banks create money out of nothing to lend to people who already have too much debt. The idea of taking that power away from the banks, and using newly-created money to actually reduce the indebtedness of ordinary people seems radical and somewhat dangerous to them.”
1718 – DEATH OF WILLIAM PENN, QUAKER WHO ESTABLISHED THE PROVINCE OF PENNSYLVANIA, THE FUTURE COMMONWEALTH OF PENNSYLVANIA
The wide-spread reputation for freedom and religious tolerance of the Pennsylvania British colony under Penn extended beyond Penn’s life to include monetary freedom. The legislature in 1723 passed an act authorizing the issuance of “bills of credit,” documents similar to banknotes issued by the government which was circulated as money. They were issued in response to the fiscal crises of Pennsylvania – crises endemic throughout the colonies due to a shortage of British pounds. Colonial currencies helped facilitate economic exchanges.
1863 – BIRTH OF HENRY FORD, INVENTOR AND INDUSTRIALIST
“It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
1881 – BIRTH OF SMEDLEY BUTLER, US MARINE MAJOR GENERAL (TWICE DECORATED)
“I helped make Mexico, especially Tampico, safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefits of Wall Street. The record of racketeering is long. I helped purify Nicaragua for the international banking house of Brown Brothers in 1909-1912 (where have I heard that name before?). I brought light to the Dominican Republic for American sugar interests in 1916. In China I helped to see to it that Standard Oil went its way unmolested…
I wouldn’t go to war again as I have done to protect some lousy investment of the bankers. There are only two things that we should fight for. One is the defense of out homes and the other is the Bill of Rights. War for any other reason is simply a racket.”
1912 – BIRTH OF MILTON FRIEDMAN, ECONOMIST
“If you kill the Fed [Federal Reserve] and don’t kill fractional reserve lending, you’ve done nothing.” Fractional reserve lending is the bank practice of holding a fraction of money in reserves compared to the amount loaned.
JULY [Not certain of date]
1939 – A PROGRAM FOR MONETARY REFORM RELEASED
A group of prominent economists issue a plan for US monetary reform. One of the co-authors of the plan, “A Program for Monetary Reform,” was University of Chicago professor and Quaker Paul H. Douglas (later to become U.S. Senator). More than 230 economists from 150 universities approved it without reservations, while an additional 40 supported it with some reservations.
In assessing the problem of the day, the PMR states, “If the purpose of money and credit were to discourage the exchange of goods and services, to destroy periodically the wealth produced, to frustrate and trip those who work and save, our present monetary system would seem a most effective instrument to that end.” It also stated a monetary system based on a gold standard “has had…disastrous results all over the world.”
The PMR called for government creation and maintenance in the quantity of money. “Our own monetary policy should…be directed toward avoiding inflation as well as deflation, and in attaining and maintaining as nearly as possible full production and employment.” The plan also called for eliminating fractional reserve lending – the process of banks loaning our many more times the amount of money in their possession. Back in the 1930’s the reserved requirement was 5:1. Today it’s 10:1. Some of the major banks involved in the economic collapse of 2007 had ignored this law and were loaning out 50 times their reserves. The PMR called for a 100% reserve requirement – banks could only lend the amount of money they possessed.
The document goes on, “In early times the creation of money was the sole privilege of the kings or other sovereigns – namely the sovereign people, acting through their Government. This principle is firmly anchored in our Constitution and it is a perversion to transfer the privilege to private parties to use in their own real, or presumed, interest. The founders of the Republic did not expect the banks to create the money they lend.
Their plan to reduce the national debt was simply to have the government purchase government bonds with new US debt-free money.
2012 – INTERVIEW OF ICELANDIC ACTIVIST HOROUR TORFASON ON PEACEFUL REVOLUTION IN ICELAND
The revolution resulted in the resignation of the government, the prosecution and jailing of bankers, and a brand new constitution!
The democracy movement continues. A recent study commissioned by the prime minister, Sigmundur Gunnlaugsson, calls for banning private banking corporations from creating money out of thin air.
1100 – BEGINNING OF THE REIGN OF KING HENRY I OF ENGLAND
About 1100 AD, the King ordered the creation of a unique form of money. Made of wood, the currency was called “Tally Sticks.” They were polished sticks of wood declared by the Sovereign King to be good for the payment of taxes. The sticks were used as money by England for 726 years – included the period of the British Empire. It may be no coincidence that shortly after the Bank of England (a private entity) was established in 1694, it attacked the Tally Stick system. Nevertheless, the Sticks were accepted as money for another 100+ years, until 1826.
Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt? Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice. This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis, Alice Francini, Deb Jose and Greg Coleridge helped in its development. Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, email email@example.com