The Fiscal Cliff, The Federal Reserve Act and its Centennial

Changes looming on the Horizon

As I ponder upon the haggling under way between Congress and the White House regarding the Fiscal Cliff... It's a difference of Revenues vs Spending cuts...

I get a peculiar 'je ne sait quoi', a  strange feeling of deja vu. Soon it will be the one hundreth anniversary of the founding of the FEDERAL RESERVE; and since the love of money is the root of all evil... I wonder if this Fiscal Cliff debate will lead to a spontaneous adoption of questionable legislation similar to what lead to the founding of the Federal Reserve?

After all, if they can hastily pass transformational legislation during the lackadaisical holly-daze once? They can do it again. Twinkle, twinkle ...

On December 23, 1913, the Federal Reserve Act, also known as the Glass-Owen Bill, was passed. The Republican controlled Senate rammed the bill through when many members of the US Congress were home for the holiday. The President, Dr. Thomas Woodrow Wilson, signed it into law one hour after being passed by the Congress! Somebody very powerful really wanted this law passed. The Federal Reserve System is an independent central bank. Although the President of the United States appoints the chairman of the Fed, and this appointment is approved by the United States Senate, the decisions of the Fed do not have to be ratified by the President, or anyone else in the executive branch of the United States government. Buried in the legislation was the granting of total power over the monetary policies of all US banks. A very curious statement is found in the original 1913 law. SEC. 30. The right to amend, alter, or repeal this Act is hereby expressly reserved. Reserved expressly to whom, or what? No definition is provided. This is the entire Section 30 statement! 1

Government interventionists got their wish in 1913 with the Federal Reserve (and income tax amendment). Just in time, too, because the nation needed a new source of unlimited cash to finance both sides of WW1 and eventually our own entry to the war. After the war, with both sides owing us debt through the federal reserve backed banks, the center of finance moved from London to New York. 2

Resources
1 http://news.goldseek.com/GoldSeek/1095269452.php

2 http://www.undergroundpolitics.com/economy/federal-reserve-history/

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