Tuesday, October 7, 2008

Comments on the Financial Situation - Thomas Jefferson

Though my life moves on seemingly unchanged amidst all the financial clamour, my brain won't let it go. This is more than a bad day at the office. It is more than a poor quarterly net income. More than a profit loss for the year.

It is more than balloon payments and property devaluation. More than the disappearance of retirement investments, plummeting market, and uninsured savings.

It is more than a bad day at the White House. More than not meeting a trillion dollar budget. More than unemployment on the rise to an expected 8%.

Thomas Jefferson addressed the subject of banking institutions nearly two hundred years ago.

"I believe that banking institutions are more dangerous to our liberties than standing armies . . . If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] . . . will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered . . . The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."

--Thomas Jefferson in The Debate Over The Recharter Of The Bank Bill, 1809

"I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale."

--Thomas Jefferson to John Taylor, 1816.

"We must not let our rulers load us with perpetual debt. We must make our election between economy and liberty or profusion and servitude. If we run into such debt, as that we must be taxed in our meat and in our drink, in our necessaries and our comforts, in our labors and our amusements, for our calling and our creeds... [we will] have no time to think, no means of calling our miss-managers to account but be glad to obtain subsistence by hiring ourselves to rivet their chains on the necks of our fellow-sufferers... And this is the tendency of all human governments. A departure from principle in one instance becomes a precedent for [another ]... till the bulk of society is reduced to be mere automatons of misery... And the fore-horse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression."

--Thomas Jefferson to Samuel Kercheval, 1816

"Our government is now taking so steady a course as to show by what road it will pass to destruction; to wit: by consolidation first and then corruption, its necessary consequence. The engine of consolidation will be the Federal judiciary; the two other branches the corrupting and corrupted instruments."

--Thomas Jefferson to Nathaniel Macon, 1821.

"It is well to note that the collapse of the mortgage market in the United States was not due solely to the burst of an economic bubble created by many bad mortgages. It was also due to the series of events that began in 2004 with the destruction of so much of the real estate and economy of Florida, the fourth largest state in the U.S. Then came the violence of Katrina that destroyed so much of the Alabama-Mississippi-Louisiana coast, and this year the sequence that culminated in Ike's enormous destruction in Texas, which led to the collapse of AIG, which held much of its value in "derivatives," or financial instruments whose value is "derived" from the underlying mortgages -- much of it on property now non-existent or in ruins.With that collapse came the collapse of the great investment houses, who had much of their value held in AIG's derivatives. And so forth. All beginning with a sequence of natural disasters that were nothing less than judgments on a system that was based on greed and showed no appropriate care for the poor."

John McCall, spiritual advisor

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