Chapter 24
Accounting Subterfuges of Capital's Bankruptcy
2Up TO the time of the War, 1914--1918, the wage-earning populace as a whole, the world over, had not understood the amplification of credit to be obtained by placing their excess earnings in share investments. Even industrialized America had, until then, simply hidden its money in its sock, or had BOUGHT land (the only way it could acquire land to till without molestation unless it went to a wilderness homestead) or had deposited excess credit in savings banks or life insurance policies to protect families ‘‘against a rainy day.’’
3 The vast government (popular) credit invoked by Fincap to underwrite war production (to end the War, the incendiary costs of which had exceeded private capital’s participation limits) had, however, legally to be accounted. This was necessitous to Fincap in the practical extension of property and debt laws already interpretatively imposed by him on the Constitution. Debt must always be legally accounted under Fincap’s ‘‘system.’’
4 The government had increased its debt limit and had financed business—‘‘war’’ business. This debt had to be passed along to the people whom the government represents. An arbitrary and forthright statement by government that every one of its citizens had unwittingly established an indebtedness to some abstract lender, or to Mr. Morgan and Company, of $105 per capita would have been, on the one hand, too ‘‘ephemeral’’ an accounting, and, on the other, unnecessarily ‘‘morbid.’’ It would have been legally insufficient and could not have been assessed.
5 As an alternative to such abstract financial ‘‘nonsense,’’ the banking fraternity, long accustomed to marketing issues to petty capitalists as well as to his own director-directed trusts, conceived the notion of selling government ‘‘securities’’ to the people as a means of assessing the debt.
6 Abetted by popular press propaganda and the momentum of patriotism, the gloriously termed ‘‘LIBERTY’’ and ‘‘VICTORY’’ bonds were promulgated. Glorious, yes! but how paradoxical the conjunction of such words as ‘‘liberty’’ and ‘‘bond’’; ‘‘victory,’’ and ‘‘bond.’’ At any rate, the indebtedness of the government was definitely established as ‘‘owing’’ to a vast portion of the populace, and the short term notes to Morgan & Company were repaid to the extent that ‘‘the boys’’ had at first advanced the credit to help get the war going.
7 ‘‘This scheme,’’ reasoned Fincap, ‘‘will allow me, as the bonds mature, to take over the handling of the debt. I shall be less busy, then, with consolidating and reinvesting war profits and can, myself, sell the refunding bonds at a neat turnover to my controlled institutional trusts, et cetera. Incidentally, I sha’n’t have to make even a selling effort. It will be perfectly delightful! The legally controlled trusts will HAVE to buy what I legally hand them so long as I synchronize the refunding to their portfolio requirements.’’ (The mechanics of this will be recited later in detail.)
8 That is how Fincap’s brain worked. As usual, Fincap failed to realize that he had inadvertently let loose a new popular phenomenon. Through the propagandization of people into the purchase of their own government’s securities Fincap not only made the populace security-and-investment minded for the first time, but also simultaneously and unwittingly (which we will later amplify) shifted the credit command potentially, though not yet actively, into the popular realm from out his own walled estate.
9 Subsequent to the War, the Ford-led ‘‘industrialization’’ occurred through the RELEASE from war to peace activity of SCIENTIFIC INSTRUMENTS and PROCESSES, invoked by the War. The American people, as a result of several factors, developed a credit of their government not only as a united whole able to do things in a ‘‘big way,’’ but as a major, if not the major, world power. These factors were (1) the governments wide mobilization for the War, (2) the uprooting of the peoples sons from their agricultural and factory-static homes, (3) their transportation oversea, (4) the world-involved-news integration inherent in the War, and, subsequently, (5) the attentively read news relative to the gargantuan industrial activities attendant on the War. Moreover, the people acquired the habit of investing in the industrial mechanism, of which the government was during the War apparent manager. Subsequently, due to the first high earnings of industrialization and the erroneously-postulated building activities by bewildered Fincap, the public delved ever more deeply into industrial share investment. ‘‘Liberty Bonds’’ were quickly converted into common shares of industrial enterprises. An era of ‘‘speculation’’ set in. The people bought industrial shares instead of refinancing the bonds as they were expected to do. Government bonds were selling at that time at ‘‘discounts’’ that today, when recalled, wring the heart of Fincaps’ progeny (questionably granting that organ to exist in his progeny).
10 A large portion of the invoked and expanded American government ‘‘debt’’ could not, however, be legally pinned upon the populace through the sale of ‘‘LIBERTY’’ and ‘‘VICTORY’’ bonds despite all aid of patriotic hysteria, yet it, also, had to be accounted. The dollars had been spent and the profits had been reaped by Fincap. So the latter endeavored to keep the eyeglass of debt firmly fixed upon the noses of people and government. The people were brought, through the press, to SEE that something HAD TO BE DONE about international war debts.
11 It was through this international war debt contrivance that Fincap accounted the government’s—or the people’s—invocation of credit to pay for his war profiteering. Through his political control of government, Fincap had, during the war, sanctimoniously dramatized, as an holy of holies affair, the ambassadorial statecraft or borrowing of ‘‘sovereign’’ France, ‘‘sovereign’’ England, and ‘‘sovereign’’ everything.
12 So impressive did the ‘‘NAME GAME’’ become that, in the hysteria of patriotism and of the dramatic romance of World War, the right of holy of holies sovereign France to establish a non-collateral credit in the U. S. for the purchase of U. S.-produced goods was popularly approved. These neat ‘‘national’’ titles positing eternal isolation policies in a potentially world-integrated populace (integrated through the War-born necessity of a common protection of their slowlyestablished degree of emancipation from utter slavery) were as useful to Fincap as it is essential for Fincap today to retain the practically meaningless (from a factual viewpoint) ‘‘individual sovereignty’’ of the 48 States of America. The important issues of the trend are still being confused by national titles: anh-Chinese, pro- Japanese, et cetera, instead of anti-hodge-podge, or pro-industrial emancipation.
13 Americans are so highly intercoursing today (as a result of automobile and abstract radio, motion picture and newspaper travel) within regional areas vastly larger than those delineated by ‘‘state’’ boundaries that they have to be continually propagandized into their ‘‘state’’ and ‘‘town’’ sovereignty-vanity sustenance by rekindled sectional ire against ‘‘damned Yanks,’’ ‘‘effete easterners,’’ ‘‘vindictive crackers,’’ or by fear-invoking notices to the effect that ‘‘SECURITY’’ of home and family is ‘‘THREATENED’’ (no explanations given) by the central government’s looming mutual-interest-efficiency control as an obvious all-for-one and one-for-all necessity.
14 Industry, itself, takes no heed of ‘‘state’’ or, for that matter, of ‘‘national’’ boundaries other than to pay tariffs when transiting arbitrarily imposed border lines. ‘‘Tariffs’’ are maintained by the constitutional-interpretation-in-Fincap’s-favor on the part of such machine-run organs as low calibered state legislatures. These non-significant, from the industrial or popular viewpoint, sovereign border lines are still utterly essential to the political gangdom control of government by Fincap and constitute the only reason for their press-advocated continuance.
15 How appealing to the intelligence is the I.C.C. license plate now to be seen at the rear of great trucks and buses, yet so paradoxically surrounded by three or four ‘‘sovereign’’ state licenses! Which, in the case of conflict, is more appealing to the intelligence as a tactical criterion—a U. S. Bureau of Standards scientific codification, or a local town councils politically devised ordinance?
16 Eventually, the automobile which through its popular adoption has made industry what it is will probably blaze the way, by popular vote, to the obliteration of all state borders. The trend in traffic problem solution already indicates the breakdown of special traffic lighting systems in Chicago vs. special traffic lighting systems in New York or Podunk. National driving standards and a national license are inevitable. The racket of the small incorporated towns and villages making game of the transient automobilist to fund local administration and patronage has been almost stamped out through centralization to higher geographical stages of government. There is herein a practical inference of the elimination of ultimate state borders and, through continentally centralized traffic regulations, of the multitude of subterfuges in driving-license procurement now so well known to millions of drivers who, losing grace in one state, may regain it without question in another, the majority of the population having a part time residence in at least two states.
17 When the War ended, the integration of the debt indicated that all other large ‘‘sovereign’’ nations were in debt to the United States. With the obvious irrationality of a clown, Fincap attempted to impose a refunding schedule of this debt, pyramided upon the sovereign victims of sovereigns—Germany and the Central Allies.
18 Until the outbreak of the War, ‘‘big shot’’ henchmen of Fincap had their headquarters in Europe. These heirs, successors and assigns of the original feudal racketeers, who had financially followed the American pilgrimage in a partially successful attempt to profitharness the new continental development, continued to reside legally on the European continent for obscurity and long-range untaxable manipulation. Although the tricks of sovereignty and statecraft had been theoretically evaded by the successful 1776 secession, the business-trick-habit inculcated by the feudalists in the new continent enabled Fincap continuously to enjoy exploitation of the highly productive, longing-inspired American colonials who had through evolution extracted the vital essence of the industrial principle from Europe.
19 This feudal finance gangdom schemed for and precipitated the World War and, through financial agents, drew America into the embrangle. These European feudal chisellers had controlled world-productivity by controlling the specie medium essential to trade until the 1914 saturation point of world-encompassing export outlets occurred. This signaled the European feudal chisellers’ inception of the War. Theirs the greatest surprise, when, at the end of the War through unforeseen ramifications, the credit monopoly had passed over from them to the American people, not to their American banking branch houses.
20 Astutely recognizing that the American populace itself was unaware of the capture, and desirous of recapturing this credit dominance which became exquisitely centralized in the American government, Fincap attempted futilely to impose great reparations payments upon the ‘‘sovereign’’ losers. Granted the reparations could have been carried out, these payments would have released European people from the yoke of their involuntary indebtedness to the American people.
21 A schoolboy could have foreseen the inability of Germany and her Allies to pay off the War’s debts, but Americans, still wearing the debt-lenses clamped on their noses by Fincap, puppetishly clamored for payment. Whereupon the American agents of European Fincap ordained that the apparently popularly accredited Americans, Dawes and Young, should descend upon Europe and ‘‘arrange’’ schedules of the debt refund. If this impossible and typical Fincap debt refunding, ‘‘from frying pan into the fire’’ plan had not been saddled upon the Central Allies we should have had no Hitler, and the Fascist bogy would probably have been amusingly confined within the geographical limits of the boot of Italy instead of developing so broadly that the latter is kicking the pants off the whole world today. ‘‘T’anks,’’ incorrigible boot-lickers of Fincap,—Mr. Coolidge, Mr. Hoover, Mr. Young, Mr. Dawes, Mr. Morgan,—nice plan.
22 Laughing up his sleeve, Fincap did everything in his ‘‘power’’ to ‘‘aid’’ the American emissaries in arranging enormous schedules phrased in nomenclature designed to be utterly incomprehensible to the American people. Said he, sanctimoniously, ‘‘I have quite obviously done my part in helping to arrange repayment to the American people. When it becomes apparent that the various sovereign holy of holies have no intention of meeting their American obligations, the failure will be blamed on the carelessness of Americas emissaries. Having enjoyed the profits of war, we can easily dispel—in the smoke of sovereignty—the fable of this debt by which we have gained, and on account of which (since it was simply a trick of ours) we have no intention of losing through legal bankruptcy—ha, ha!’’ Sovereign states do not go bankrupt legally; they simply ‘‘change political color.’’
23 Nonetheless, quasi credit had not only shifted from private to popular prerogative, but inadvertently had become real credit and the industrialized American people became its master. The cat was out of the bag. The world of people in America gained credit control beyond recall, a decade later to be demonstrated as inadvertent popular control of the accrediting of industrial advance.
24 This nascent mastery was not, as Fincap would have it, in the role of creditor nation,’’ but inherent in that sector of world populace leading the industrial advance; freed of indebtedness to any outside source; wealthy in capital instruments and goods of industry 100 times over any internal accounting-out of the ravages of the old debt disease; isolated on a continent relatively safeguarding it from attack till popular realization and consolidation of the man-emancipation could inevitably develop, and governmentally unified in a healthy young democracy, the latter a time-limit and publicity safeguarded administrative scheme self-adjusting to the scientific acceleration of evolution which had already, through hydraulic damning and power conversion, harnessed in-continuity the unlimited ceaselessly replenishing wealth credit of star-emanating energy.