Finally: Economic Sanity Returns to America

It started with the crash and depression of 2008-2009. Consumers had finally lost the ability to float global business with their credit cards and home equity loans.

Finally even the politicians had to face the facts. Ever since the 1980s, when the economy was handed over for plundering to the banks and the Wall Street plutocrats, ordinary people had struggled just to survive.

Except for a handful of fabulously wealthy oligarchs, almost everyone else was drowning in debt. Prices of gasoline, food, and health care had continued to skyrocket. The housing bubble collapse had left whole cities of foreclosed homes only providing shelter to homeless people.

Overseas the U.S. had become a mockery, with the military fighting wars on every continent in a futile attempt to retain the hegemony of a U.S. dollar whose value had evaporated. The twilight of the American empire had arrived as the alliance of Russia, China, and India flexed its muscles.

Finally the American people had enough and elected a President with the guts to challenge the fundamental problem—a debt-based currency which subjected the population to slavery at the hands of the financial magnates who had ruled since the passage of the Federal Reserve Act in 1913.

The first thing the President did was declare a National Dividend—an immediate cash stipend to all citizens averaging $15,000 per person per year. It was like the Alaska Permanent Fund but much larger.

The Dividend was granted to everyone regardless of whether they were working or not. It was the rightful share of the entire population in the producing bounty of an industrial economy. It was the share the banks had been stealing for so long by putting everyone in debt just for the necessities of life.

Of course many who had been living in starvation conditions were happy to use their Dividend to live without working. This was to be expected. But for most, the Dividend provided a new lease on life.

People could finally begin to pay off their loans and start anew. Students could attend college again without being shackled to decades of debt. Families were no longer one illness away from financial ruin.

In rural areas, the family farms which had been wiped off the map by agribusiness made a comeback. The inner cities whose economies had been devastated once again saw small businesses flourish.

And along with financial security, joy and well-being were returning to a land that had been haunted for so long by greed and fear.

The National Dividend had saved America.

Richard C. Cook is the author of We Hold These Truths: The Hope of Monetary Reform, scheduled to appear by September 2007. A retired federal analyst, his 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. He is also author of Challenger Revealed: An Insider’s Account of How the Reagan AdministrationCaused the Greatest Tragedy of the Space Age. Read other articles by Richard, or visit Richard's website.

21 comments on this article so far ...

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  1. Ron Horn said on February 28th, 2008 at 10:46am #

    This fantasy, although inspiring, may be useful if it encourages people to understand what prevents it from being a reality. It seems to me that if one understands that we live under a dominant investor class, then such an idea will only remain a fantasy. This is simply due to the fact that the investor class would have to give up its primary function which is to further their private interests in deference to the benefit of the larger society. Their private interests are to accumulate more wealth, and with that wealth comes power. They would have to pay more in taxes, they would have to forgo military adventures to secure markets and access to resources and cheap labor, and they would have to allow non-investors influence over critical and economic decisions. Thus to subordinate their interests to those of the larger society would result in their loss of wealth and power. It’s foolish to think that this would ever happen. No ruling class has ever willingly given up its power and privileges to benefit other classes of any society.

  2. Richard Cook said on February 28th, 2008 at 11:12am #

    I agree that the ruling class will not “willingly” give up its power. The point of my post is that its power must be taken back by a strong President–acting for the sake of the people who are suffering under the
    tyranny of the oligarchy. Roosevelt did it, and it now must be done again.

  3. Deadbeat said on February 28th, 2008 at 8:15pm #

    Mr. Cook you are mistaken about Roosevelt. What changed Roosevelt was the people and the direct action taken by the people. Also in the 1930 there was a robust left such as the Communist Party and the Socialist Party that provided alternative ideas to Capitalism. The left is weak and the people are too indoctrinated and made passive. This is why you have Obama not even advocating single-payer health care which is badly needed.

    You cannot have a “strong” president unless you have people DEMANDING progressive change. Progressives have been unwilling to make demands for a very long time and the left has been fractured by its own internal divisions.

  4. Mark Sawyer said on February 28th, 2008 at 8:17pm #

    Let’s bring it to 2007. If you had 300 words to put into the mouth of a presidential candidate, what would those words be?

  5. Richard Cook said on February 29th, 2008 at 5:03am #

    The question was asked by Mr. Sawyer what a Presidential candidate running for office today should say. The following is suggested:

    Coming out of World War II, the United States had built the world’s greatest industrial democracy. Despite the persistence of hard-core poverty in certain sectors of the economy, most Americans had decent jobs, could buy a home at a modest price, and get a good education for their kids.
    These aspects of the American dream are being lost today, despite incredible technological progress and the amazing productivity of the global economy. The dream is being lost because the fruits of science and technology have fallen largely into the hands of an oligarchy of very rich people who control society and the economy through a debt-based monetary system.
    Increasingly over the last generation, control has passed into the hands of this oligarchy of the monetary elite. They have gained control by drowning the entire society, including families, workers, businesses, and government, under a tsunami of debt, debt that can scarcely be imagined and can never be repaid. This debt now totals, by conservative estimates, approximately $50 trillion for all sectors, or four times the nation’s entire GDP.
    It is time now for a President, acting on behalf of the people, to take back control of our country from the oligarchs. This can be done through the simple expedient of treating credit and the creation of the money supply as a public utility, as critical to economic and social health as water or electricity.
    On the day I am inaugurated as President, I will send legislation to Congress for the following:
    1) The Federal Reserve System, which has become the private plaything of the oligarchs in controlling the economy, will be abolished as a bank of issue;
    2) The American Monetary Act, as drafted by the American Monetary Association, will be enacted, placing control of the monetary system under a Monetary Control Board within the U.S. Department of the Treasury;
    3) A moratorium will be placed on collection of all debts created “out of nothing” by financial institutions which have abused their fractional reserve banking privileges;
    4) All lending by financial institutions for speculative purposes, including leveraged buyouts and other forms of leveraged lending for speculative purchase of assets, will be suspended;
    5) A new National Infrastructure Bank will be created within the executive branch to rebuild our physical economy and fund a new national monetary system;
    6) A debit line shall be created within the federal budget from which a National Dividend averaging $15,000 per person per year will be paid to all individuals as their fair share in the bounty of the world’s resources which the oligarchy has unfairly usurped.

    These measures will, within a matter of weeks, revitalize the economy, restore to individuals and families control of their own economic destiny, return our country to real economic democracy, and avert the social cataclysm that awaits if decisive measures are not taken without further delay.

  6. martin hattersley said on February 29th, 2008 at 10:37am #

    At last, a breath of common sense in a situation that our current politicians seem unable either to grasp or control!

  7. Susan Boskey said on February 29th, 2008 at 4:59pm #

    If not now….when? If not us….who? As Deadbeat above said so well, we the people must demand such changes if they are ever to get “on the table”.

  8. Deadbeat said on March 1st, 2008 at 1:30am #

    Mr. Cook is incorrect about the debt crisis. The debt crisis was not created by the Fed or the monetary system. It was created by fiscal policies especially the fiscal policies of Ronald Reagan. Reagan cut taxes on the rich and deregulated Capitalism while increasing military spending.
    About 80% of the debt is the result of past military expenditure and the current War in Iraq is estimated costing $3,000,000,000,000.00 (3 trillion dollars).

    The FED is responsible for the stock market bubble of 2000 and the housing crisis for lacking oversight and was responsible for the deep recession of the early 1980’s. Rather than take serious action, Jimmy Carter allowed the FED to send the economy in a recession and shifted the oil price shock onto working people.

    Your analysis is terribly flawed. What is needed is a restoration of fiscal policy which restores the progressive tax structure and slashes military spending by redirecting that money to fixing domestic infrastructure. In other words the U.S. has to withdraw from being an “empire” and start to get along with the rest of the world.

  9. Deadbeat said on March 1st, 2008 at 1:40am #

    Let’s bring it to 2007. If you had 300 words to put into the mouth of a presidential candidate, what would those words be?

    All the major candidates supports the rich and powerful that is why none of them offers single-payer national health care; all support Israel; none talk about cutting the bloated and wasteful military budget; none offer an urban renewal plan; repeal of Taft-Hartley; repeal of the Patriot Act; restoration of Welfare for the Poor; restoration of full unemployment benefits — 52 weeks; etc.

    People have to wake up to how Capitalism works and realize that Capitalism is an UNFAIR economic system. If Capitalism remains as the basis of economy then safe-guards must be made against its deleterious aspects of power and wealth concentration. The rich must pay highly progressive taxes for the benefits they reap from this unfair system. That is what is meant by “fair share”.

    Mr. Cook has a flawed view of Capitalism as well as much of the rich people who run for office and why you cannot look to them for solutions to the problems of the working class. People have to realize that their is a class war being waged against them and they are losing badly.

  10. siamdave said on March 1st, 2008 at 3:36am #

    For some facts about how the same thing has happened in Canada, it’s all laid out in gruesome detail at Banketeering – how the banks have been stealing trillions from you, and the tap is still running .

  11. Richard Cook said on March 1st, 2008 at 4:54am #

    In response to Deadbeat, capitalism is not the problem. It really doesn’t matter who owns the means of production, because the issue is that the appreciation of the economy through the application of science and technology is stolen by the financiers rather than returned to the people through a National Dividend. This is done through the debt-based monetary system. The answer is not more taxation of anybody. Indeed, if the principles of the American Monetary Act were applied the expenses of government could be paid through direct Greenback-type government expenditures and the tax burden could be reduced substantially. Deadbeat needs to start getting educated about the emerging monetary reform movement. Nader is a tax-and-spend liberal, which is why he has become increasingly irrelevant.

  12. Stephen Zarlenga said on March 1st, 2008 at 9:35am #

    Rick Cook’s educational writings that our mistructured monetary system is an ultimate secular cause of our problems is both refreshing and very hopeful! The American Monetary Act, is found at the American Monetary Institute website, and comments and critiques are always invited.
    Stephen Zarlenga, Director, American Monetary Institute

  13. Jim said on March 1st, 2008 at 3:15pm #

    The economics of the left and the right are dead-ends.

    The right holds to monetarist theories of Milton Friedman, and the left adheres to the theories of J.M Keynes. Neither truly understands the systemic causes of inflation, or the gap between income and prices. Monetarists simply ignore the gap, and claim it doesn’t exist, and Keynsians want to eliminate the gap through increase capital production and/or increased government spending.

    Keynsianism is inflationary, and unsustainable. Monetarism makes the “cure” worse than the “disease”.

    The only sustainable solution is the adoption of a dividend and price rebate as Richard Cook has been suggesting based upon the recognition of the fact that technology is displacing the need for labour in the productive process, and the real cost of production is consumption over an equivalent period of time. C.H. Douglas was the first person to understand that prices rise faster than incomes, and his policy recommendations are the only way to overcome a debt based monetary system that keeps pushing us further and further into debt in order to consume goods that have already been produced.

  14. P Scott said on March 2nd, 2008 at 12:52pm #

    While I generally go along with your premise, there are two things worth clarifying:

    1. “it [UBI/ND] was the rightful share of the entire population in the producing bounty of an industrial economy”

    Lets be clear here, UBI isn’t to be budget funded. Its paid for by the charges placed on users for access to assets that belong to everybody, for example, carbon sinks, minerals, radio spectrum, fishing quota etc. While we have some of these charges today on a very few assets, they tend to take the form of property rights and not perpetual tax-like charges, the latter being fairer. Extending, and correctly valuing these charges to all national/global assets will indeed generate a fortune, and have a dual conservation benefit.

    2. I gather you are writing a book on money, so be mindful of language. Some of the terms you use are unhelpful.

    “a debt-based currency”:
    All money systems, good or bad, are by definition based on debt and credit. That’s how trade is enacted.

    “A moratorium will be placed on collection of all debts created ‘out of nothing’ by financial institutions”:
    Ditto. This is an emotional phrase being used by the Social Credit leaning camps of the monetary reform movement. But it reveals a regrettable lack of understanding of what money is. See below.

    “treating credit and the creation of the money supply as a public utility”:

    “placing control of the monetary system under a Monetary Control Board”:
    No this is just another means of control. Money doesn’t require control, in the sense that ‘someone has to decide how much money to make available’. That’s only applicable if you believe that the government or someone needs to create enough money for us to use. But if you understand that with the use of credit clearing/mutual credit systems you don’t need to first create money in order to use it, then the newly nationalized banks will simply provide an accounting system.

    Banks today do this quite well. They provide an accounting system, that debits the purchasers account and credits the sellers. The problem though is that banks pathologize, and then misappropriate the proceeds of that debt. Day to day trading debts are fundamentally debts to the trading community, not debts to the bank. That is a slight of hand. Therefore the ‘so called’ cost of that debt, the ‘interest’ shouldn’t accrue to the bank but to the trading community. That’s theft.

    The easiest way to understand this is to imagine a new community, where everyone starts with $0 in their account. If no-one can go into debt, then no-one can buy anything. Someone has to go into debt briefly in order to reciprocate. If you get this then it will always strike you as odd when banks dishonour transactions when your account is overdrawn. That’s precisely how they create money scarcity, by limiting debt to specially rationed, profitable mechanisms like mortgages, debentures and bonds, issued to “approved” people at exorbitant rates. They can, because they have first outlawed that with which ordinary traders need to enact trade, essentially a free overdraft.

    Obviously management and securing those trading debts remains a necessity, but ironically and indeed paradoxically when debt stops being pathologized peoples debts will be much smaller. This is because by freeing up trade, and substantially eradicating bank usurped interest, economic productivity will soar, and large capital oriented debts will become a thing of the past. Governments especially will never need to borrow for anything ever again.

    “fund a new national monetary system”
    So, a money system doesn’t need funding. That’s my point. Money is not a tangible asset, simply a tool to enact trade.

    ” The National Dividend had saved America”
    No, that’s just a side benefit. Unseating the banks saved America.

  15. Jim said on March 2nd, 2008 at 7:04pm #

    All money currently is debt based, but that does not mean it necessarily needs to be that way.

    Social Credit “camps” do not advocate a morotorium on all debt based money. Douglas advocated the use of debt free credits to “augment” the debt based system because prices increase faster than incomes leading to ever increasing debt.

    There is no confusion on “what money is” by those who advocate Social Credit. Money is a ticketing system and a means of distribution of production. The only people confused on “what money is” are the people who believe that money is a commodity and therefore has value in and of itself.

  16. Donna Gaddis said on March 5th, 2008 at 4:55pm #

    Well, here’s my two cents worth. You may be able to put the financial oligarchy out of business for a period of time, but, with the use of any medium of exchange, they will always have their foot in the door and eventually I feel that they will be back in power within a hundred years. The only way to set the economy right is that NO ONE PAYS FOR ANYGTHING AT ALL. Lest you think that that is giving things away free? Well, we are working aren’t we? Lest you think that individuals will not work and want a free ride on the backs of the rest of us-well I don’t think so. I believe that as long as people will be getting their fair share, they will be willing to do their fair share. And I believe that all human beings will work less hours a week and not have to work as hard. Timor of Athens of a bygone day of many centuries ago called money the whore of mankind-and he was right. It took John of the Apocalypse to give that whore a name-her name is Babylon. I really respect what Mr. Cook and Susan Boskey are saying and I believe that they are sincere. But, I believe that the use of any medium of exchange is going to be swept away into the dusbins of history.

  17. Richard Cook said on March 5th, 2008 at 5:55pm #

    I have communicated with Ms. Gaddis on this subject before and have agreed that if and when mankind becomes much more enlightened than we are today, money will become a thing of the past. I have also said as much in my writings. A time will come when people work and produce for the love of it and out of conscience to the community. At that point money will not be needed because whatever we really require will be available. And because it is available there will be no need to hoard or acquire possessions for their own sake. Possessiveness is just another type of fear. I have called money “the last tyranny.”

  18. Jim said on March 7th, 2008 at 3:57pm #


    This sounds like communism: from each according to their ability, to each according to their needs.

    There will always be a “cost” associated with production, and if nobody paid a price for the good or service consumed, then the firm supplying the good or service would be unable to recoup its costs.

    There are always inputs into production which have real costs, whether it’s the time spent from people who actually create the good or service, or the plant, materials, and equipment depreciated during its construction.

    The idea that there will some day come a time when everything is “free” is complete idealism, and that is certainly not anything that Social Credit is proposing.

  19. John Fellowes said on April 13th, 2008 at 10:35pm #

    I just heard Richard on WTPRN radio and it was awsome. I really think a video or a tape of your discussion would make it easier for me to reach a lot of people. Most people I know would never read your articles but would be likely to watch or listen. I would love to hear that broadcast again. Thanks. I learned most of what I know from the Wizards of Money which is available on tape or print download. Their objective is to make money easy to understand and make a way to educate people

  20. AJ said on April 14th, 2008 at 9:46am #

    I concur with John Fellowes. I think a video (e.g. YouTube) discussing these policies, potentially with pretty graphs and dramatic pictures, would be able to acquire the attention of many people who lack the patience to read.

    A shorter video could act as an summary or introduction of the policies, followed by a full-length video detailing the history of financial policies and their effects.

  21. Charlie Aphase said on June 5th, 2008 at 6:44am #

    The states should go back to making their own currency. Then goods produced and traded interstate could be locally controlled. Money value from interstate trade could go to a US central clearing house were accounting would be kept. With the internet and computers this could be done on a daily basis. Taxes could be collected at the same time automaticlly. There could be value added tax locally or sales tax locally. People could go to the next state to buy if prices were better
    as a result interstate competion would take place. Our for fathers gave up state currency for a centralized currency to eliminate monitery confusion. With computers and a money market that would eliminate that confusion.