DISMANTLING THE U.S. FEDERAL RESERVE SYSTEM

DISMANTLING THE U.S. FEDERAL RESERVE SYSTEM

Edited by Frederick Mann
© Copyright 1995, ALL RIGHTS RESERVED

http://www.mind-trek.com/reports/tl17a.htm

Introduction
For centuries there has been a war between the "money controllers" and
their opponents trying to wrest away control. One of the American
Founding Fathers was Alexander Hamilton, who was a "money controller"
who believed in a strong centralized federal government and a central
bank. One of his opponents was President Andrew Jackson who vetoed the
extension of the charter of the United States Bank (monopoly central
bank) in 1832.

Some people believe that the "money controllers" constitute the
"secret government" of the world, and that most or all of the
ostensible national governments are mere puppets of the "secret
government" behind the scene.

"As a result of the war, corporations have been enthroned and an
era of corruption in high places will follow and the MONEY POWER of
the country will endeavor to prolong its reign by working on the
prejudices of the people until wealth is aggregated in the hands of a
few and the Republic is destroyed. I feel at this moment more anxiety
for the safety of my country than ever before, even in the midst of
war." - Abraham Lincoln

This report includes:

* President Woodrow Wilson's role
* A license to steal - how fractional reserve banking works
* One more turn of the screw - an old fable for modern times
* The nation's dictator
* Proposed legislation to repeal the Federal Reserve Act
* Paul Luther's case
* The Free Enterprise solution.

President Woodrow Wilson's Role
On December 23, 1913, Congress passed the Federal Reserve Act.
President Woodrow Wilson, while keeping his campaign promise to the
bankers, signed the Federal Reserve Act legislation which sold our
country to a private organization of bankers.

Being a highly educated man, a brilliant professor and president of
the prestigious Princeton University, President Woodrow Wilson was
able to conclude within three years after the passage of the Federal
Reserve Act, the destruction of our great country. Referring to the
great number of bankers who swarmed into the nation's capitol,
President Wilson said:

"I have unwittingly ruined my country. A great industrial nation
is controlled by its system of credit. Our system of credit is
concentrated. The growth of the nation, therefore, and all our
activities are in the hands of a few men. We have come to be one of
the worst ruled, one of the most completely controlled and dominated
Governments in the civilized world - no longer a Government by free
opinion, no longer a Government by conviction and the vote of the
majority, but the Government by the opinion and duress of small groups
of dominated men."

Even before the Federal Reserve Act was passed, Thomas Jefferson
predicted a huge national debt if we violated our Constitution and
allowed a bank like the FED to exist. Read on to find out how to help
abolish the FED and zero out the National debt

A License to Steal - How Fractional Reserve Banking Works
The book, Repeal The Federal Reserve Act, written by Rev. Casimir F.
Gierut, describes in detail just how Congress sold out our nation to
private bankers and how those private bankers fraudulently and
illegally operate their businesses and cost taxpayers millions of
dollars each year. This book is not based on the opinions of people
who have limited knowledge of the banking institutions. Nor is it
based on the opinions of persons who had a personal grudge against the
bank or bankers. This book is based on the sound judgments of
dedicated American's who have served as members of Congress. This may
very well be the greatest LICENSE TO STEAL story ever perpetuated in
the history of mankind. When Congress passed the Federal Reserve Act
on December 23, 1913, to present date, the Federal Reserve Banking
System has been stealing from the Government as well as from the
people of these United States. The Federal Reserve Act gave these
private group of Bankers the right to go directly into our country's
Bureau of Engraving and authorize the printing of currency at a cost
of less than a penny a note. This is the first step in their swindle
and the beginnings of the deceitful "fraction reserve" money ratio
formula used in banking today. Take a look at what happened and come
to your own conclusions.

It all started with the private bankers of the 16th century in Western
Europe. The "goldsmith bankers," as they were nicknamed in those days,
would store people's gold in a bank vault for safekeeping. The banker
would then give the depositor a "receipt" for his gold. Anyone having
possession of a receipt was able to go to the bank and claim the gold.
People soon learned they could carry on trade and commerce by simply
passing the receipt from hand to hand without ever drawing out the
gold, and henceforth, those receipts began to circulate as "money."
This led the "goldsmith bankers" to a discovery which is the founding
principle of the "fractional reserve" banking still in existence
today. Congressman Wright Patman of Texas wrote about that time
period:

"Few people who held the goldsmith's receipt came to claim their
gold. As the goldsmiths (bankers) realized this, they also realized
that they could make loans of gold which had been in their
safekeeping. That is, they could write receipts for gold to borrowers
who, in fact, were not depositing new gold but borrowing the ownership
of gold already in the goldsmith's possession. This gold - actually
the 'receipts' of ownership - being loaned by the goldsmith was not
his to lend. He did not own it. But so long as the calls for gold by
the original depositors were so infrequent, the goldsmith felt he
could lend without undue risk and earn interest on a certain portion
of the deposited gold"...

"In other words, the goldsmith wrote receipts for people who were
not depositing gold. These receipts too circulated as money. So
receipts for more gold than the banker actually had in his vaults were
circulating. The goldsmith had only a fraction of the amount of gold
needed to meet the claims [receipts] against him. They were issuing
$10 in receipts for each $1 in gold. This is the fractional reserve
system"...

"Although it is a long historical step from the goldsmith bankers
to the present day, the logical development is quite short. For our
modern system is only a refinement of "fractional reserve" banking
developed so long ago (by the goldsmith's bankers)."

So today we have evolved from operating with the goldsmith bankers to
dealing with the international (Federal Reserve System) bankers,
actually very similar in nature. Our investigation takes us to an
examination of the Federal Reserve Act to more fully understand what
happened in 1913 that is affecting us today in the 1990s.

Many people (and almost all bankers) are under the misconception that
Congress "created" the Federal Reserve Act of 1913. This is not true.
Congress merely "passed" the legislation and President Woodrow Wilson
signed the Act into law. In fact, the Federal Reserve Act was
initially composed as a proposal for legislation by a group of private
bankers who met in deep secrecy and not by any members of Congress.
Present at those meetings were the following bankers: Frank Vanderlip,
President of National City Bank of New York; Henry P. Davidson, senior
partner of J. P. Morgan Company; and Charles D. Norton, President of
Morgan's First National Bank of New York. These three powerful bankers
invited Mr. Paul Moritz Warburg of M. M. Warburg Company of Hamburg,
Germany, which was the chief German representative of the European
banking family, the Rothschilds.

Mr. Paul Moritz Warburg would go on to mastermind the entire document
that we recognize today as the Federal Reserve Act. As a partner of
Kuhn, Loeb and Company Bank of New York, he was aware of the
sentiments of the Congressmen who opposed the formation of a Central
Banking System in the United States and knew they blamed the money
panic of 1907 on the big New York bankers and the speculators of Wall
Street. Thus, Mr. Warburg searched for a title that would not alert
the Congressmen as to the true intent of the document he was
preparing. He used the word "Federal" in the title which gave the
false impression that this document involved the Federal Government.
The Federal Reserve System had three very important elements:

1. The Federal Reserve System would be owned by private bankers;
and thus would earn profit for the bankers.
2. In due time the bankers would gain control of the issuance of
the nation's money.
3. The bankers would use the credit of the United States by
involving the United States in foreign affairs.

Warburg established four branch reserve banks in four different
sections of the country seemingly independent of each other. This
furthered the deception by giving the impression that the New York
banks and Wall Street were not in control of the Federal Reserve
System. The hidden factor was that all four regional reserve banks
were united with the Federal Reserve Bank of New York, which was to be
the main bank of the Central Banking System in our country.

When the bankers and Warburg were satisfied that they had accomplished
what they had set out to do on paper, they invited Senator Carter
Glass to introduce the Federal Reserve document on the floor of
Congress. And so with expressed views of the bankers and Warburg's
"Federal Reserve Act," the Central Banking System in the United States
was born. The events that followed as a result of that legislation
being introduced to Congress can be described with the following
excerpt from Gierut's book:

"Bank officials swarmed into Washington, D.C. to lobby for the
passage of Warburg's document. This legislation was strongly opposed
by Congressman Charles Lindbergh, Sr. of Minnesota. He warned that
this document was, in fact, establishing a Central Banking System. His
greater concern was the fact that this type of banking system would
create recessions, depressions, inflation, boom and bust of the
nation's economy."

Opposition came from Senator Cabot Lodge, he said:

"I had hoped to support this bill, but I cannot vote for it as it
stands, because it seems to me to contain features and to rest upon
principles in the highest degree menacing to our prosperity, to
stability in business, and to the general welfare of the people of the
United States."

And Senator Elihu Root denounced the Federal Reserve bill as an
outrage on our liberties.

Many of the Congressmen foresaw the handwriting on the wall. The
bankers would, in due time, have complete control over the money
supply. The bankers would be the secret elite ruling over Congress
itself.

Pressure on the Congressmen grew as the debate increased on the Paul
Warburg document. The National banks contributed over $5 million to a
fund for propaganda in favor of the passage of the bill.

As time went on the Democrats and Republicans took their stand. The
Republicans were against this legislation. The Democrats made the
Federal Reserve Act a part of their platform. The Democrats nominated
Professor Woodrow Wilson, president of Princeton University, to run on
the Democratic ticket for the Presidency of the United States.

The bankers throughout the country were all out campaigning for
Woodrow Wilson. With their help, he was elected President of the
United States.

After the election of November 1913, the bankers worked hard to bring
the Federal Reserve Act to a vote near the Christmas holidays. They
knew that some of the Congressmen would leave earlier for their
Christmas vacation, therefore some would be absent at the time of
voting on the bill. Secondly, with the Christmas holidays and
Christmas rush, many Congressmen would not take the necessary time to
study the Federal Reserve document. Thus, as the bankers planned, the
House of Representatives voted on the Federal Reserve Act on December
22, 1913. The House voted on House Resolution 7837 (the Federal
Reserve Act) introduced by Senator Glass.

On so important an issue, 103 empty Congressional seats meant less
opposition to the passage of the Federal Reserve Act. Can you imagine
103 of our elected officials (76 Representatives and 27 Senators) were
more concerned about going for their Christmas vacation than saving
our country? Many of the Congressmen did not have time to read the
entire bill. Many who did make an honest effort to study the
legislation found themselves lost in the forest of technical banking
vocabulary.

On December 23, 1913, the Day of Infamy, Congress passed the Federal
Reserve Act. Keeping his campaign promise to the bankers, President
Woodrow Wilson signed the document which sold our country to private
bankers."

Congressman Wright Patman (R, Texas) gives an explanation of the
formula of the Federal Reserve Banking System which is worthy to note.
He explains how the entire banking system centers around the
"fractional reserve money ratio formula" which is approved by the
members of the Federal Reserve Board of Governors. To quote
Congressman Patman:

"The formula consists of two parts. One is the amount of bank
reserves which the member (local) banks of the Federal Reserve System
have to their credit on the books (held at the district) Federal
Reserve Banks. The second part is a regulation, which the Federal
Reserve Board (of Governors) issues from time to time, telling the
member (local) banks the maximum amount of bank deposits they may
create per each dollar of their reserve deposit"...

"Expressed mathematically, this is a simple formula: A x B = C. A
= Amount of (local) bank reserves; B = The number of dollars of
deposits member (local) banks can create per each dollar of reserves;
C = Total Bank Deposits. This is an example of the fractional reserve
money ratio formula in terms of money: A x B = C.

A = Represents $10,000 the local member bank has in the reserve
account.
B = The number of dollars member banks may create per each dollar
in reserves is $10.00 for each $1.00 in reserve.
C = For the total bank deposits, multiply $10,000 by the present
ratio of $10 for each $1 in reserve. This means $10,000 times $10
equals $100,000. The local bank may record a total of $100,000 in the
"bank deposit" checking account for future loans."

This is a very important formula and worthy of memorizing. This is the
simple equation to understanding the entire Federal Reserve Banking
System. This is how the Federal Reserve Board of Governors and the
thousands of member local banks operate without ever being exposed for
the fraudulent bookkeeping entries, the printing of the "phony buck,"
transacting fraudulent loans, creating unjust and illegal interest,
and even confiscating property. All of this collectively issues the
LICENSE TO STEAL.

To comprehend the magnitude of the passing of the Federal Reserve Act
into law requires an in-depth study of our history, the important
players both major and minor, and an analysis and understanding of the
Congressional legislative history surrounding the issue. The purpose
of this report is to give factual foundation to further motivate study
and prompt you into action!

And action is just what Rev. Gierut's organization, the "National
Committee to Repeal the Federal Reserve Act," is all about. He calls
for the end of the fractional reserve money ratio formula through
which acts of thievery are committed on a daily basis by the banking
system. He urges all American taxpayers, Congressmen and the President
of the United States to wake up and demand the Federal Reserve to stop
using the illegal formula. Gierut offers a Constitutional Monetary
Reform Plan as the means and necessary actions to save our country
from total financial collapse and utter ruin. This plan consists of
seven propositions which are in summary:

1. Abolish the fractional reserve money ratio formula. Replace it
with a 100% reserve account for all future loans.
2. End all bond swindling schemes by issuing lawful currency backed
with gold, or silver, or backed with United States Treasury Notes.
Thus, it will become ujnecessary for the Government to issue bonds to
back its own lawful currency.
3. Repeal the Federal Reserve Act of 11913 and all subsequent
amendments.
4. Stop the issuance of unlawful Federal Reserve Notes.
5. Repeal the National Bank Act of 1863 and return the banks to the
jurisdiction of the state they are located in.
6. United States take ownership of the 12 District Federal Reserve
Bank Buildings which were constructed at the expense of the American
taxpayers.
7. Cancel the National debt owed to the Federal Reserve Banking
System as the law does not permit banks to profit from fraudulent
practices.

As of the December 1994, the Federal Reserve Act remains intact. Year
after year, legislation is introduced into congress to repeal the Act.
Year after year, the legislation is voted down. The banks have
continued to "buy off" congressmen and Senators which can easily be
determined by Financial Democracy Campaign Analysis of Federal
Election Commission which recorded donations by the largest bank
holding companies in 1989-1990 to have been $9.3 million.

All that could be said about the most corrupt organization ring in
America is best stated in a speech Congressman Louis McFadden of
Pennsylvania delivered on the floor in Congress. On Friday, June 10,
1932, Congressman McFadden, who was chairman of the House of
Representatives Banking and Currency Committee for ten years, spoke
with authority on the subject of money and the Federal Reserve Banking
System. In his address before the members of Congress, he stated:

"We have in this country one of the most corrupt institutions the
world has ever known. I refer to the Federal Reserve Board of
governors and the Federal Reserve banks. The Federal Reserve Board has
cheated the Government and the people of the United States out of
enough money to pay the national debt. This evil institution has
impoverished and ruined the people of the United States, has
bankrupted itself, and has practically bankrupted our Government. It
has done this through the defects of the law under which it operates,
through the maladministration of that law by the Federal Reserve
Board, and through the corrupt practices of the money vultures who
control it."

"Some people think the Federal Reserve Banks are United States
Government institutions. They are not Government institutions. They
are private credit monopolies which prey upon the people of the United
States for the benefit of themselves and their foreign customers,
foreign and domestic speculators, and swindlers. Those 12 private
credit monopolies were deceitfully and disloyally foisted upon this
country by bankers who came here from Europe."

"The danger that the country was warned against came upon us and
is shown in the long train of horrors attendant upon the affairs of
the traitorous and dishonest Federal Reserve Board and the Federal
Reserve Banks. This is an era of economic misery; and, for the
conditions that caused that misery, the Federal Reserve Board and the
Federal Reserve banks are fully liable. THIS IS AN ERA OF FINANCED
CRIME

One More Turn of the Screw
There is an old fable in which Aesop tells of the woodsman who went
into the forest to get a handle for his axe. We've included this story
in this report because it accurately describes what happened to us
when the Federal Reserve Act was passed and signed into law. It seems
the woodsman went into the forest and consulted with the trees,
negotiating a handle for his axe. Now the large and mighty trees, the
stronger ones, arrogating to themselves authority and ignoring the
rights of others, thought that they could dispose of the smaller trees
as they pleased.

The larger trees conferred together and decided to the grant the
woodsman's request, and so they gave to the woodsman the Ash tree. The
Ash soon fell; but the woodsman had no sooner fitted the handle to his
axe than he began upon the other trees.

He did not stop with the Ash, but he also hewed down the great and
mighty Monarchs of the forest who had surrendered in their pride, the
rights of the humble Ash. An old Oak was heard to complain to a
neighboring Cedar; "If we had not given away the rights of the Ash we
might have stood forever; but we have surrendered to the destroyer the
rights of one, and now we are suffering from the same evil ourselves."

The moral of the story: Don't cut off somebody else's to spite your
face.

If we look closely at our Government and the way successive
legislation destroys individual rights - knowing that government is
being controlled and manipulated by a group of private bankers - could
we really be dealing with woodsmen who always want more handles

The Nation's Dictator
[Excerpts from speech, Congressional Record, by C.G. Binderup]

"YES, YOU, the Federal Reserve Banking System, you are the
dictator in our great nation. You are the Nero who fiddles while Rome
is burning.

We in Congress can study for years, travel for miles, and
legislate for months, striving to enact sound legislation. We come to
Washington holding aloft a mandate from the people. We come clothed in
power by the ballots representing the will of 135,000,000 citizens. We
come to enact laws for the general welfare, but in every nook and
corner of the Nation's Capital you are here, the invisible government,
the power behind the throne of government. You with your red flag of
economic dictatorship, you whisper into the ear of Congress, "Listen!
We hold the power supreme, the power of money, and by this power we
can dictate and determine just who shall occupy our seat." You whisper
into the ear of the Public Press, "Listen! We hold by the power of
money the control of big business that buys your advertising
contracts, that determines the life or death of your paper." You
whisper to the management of radio broadcasting stations, "Listen! We
own the bonds and the stocks directly or indirectly. Your salary
depends upon us."

We pass worthy laws through the House and Senate, and the President
signs. We attach a large penalty for violation, and congratulate
ourselves that we have expressed the will of the people in laws, but
you, the Federal Reserve Banking System, you hold in your hand a
mightier power, the power of money, for by this power you control God
Almighty's first law, the law of self-preservation. By the power of
money you command and inflict the penalties of starvation and
deprivation, misery and want. You can break every law Congress can
ever make. You can starve the most righteous soul until he will steal
that his loved ones may have food and shelter.

You can crowd the most peaceful man until he will kill in murder and
war that the reasonable wants of his loved ones may be satisfied. On
the auction block of starvation and deprivation Man will sell his
honor and Woman will sell her soul to satisfy that inward craving for
food that God has put in the mind and body of man.

Yes, with this magic wand, the power of money, this firebrand of
destruction, you can change to criminals our citizens of most worthy
stamp, change a patriot into an enemy, love for country into hate. You
can destroy - as you are doing today and as you have done twenty-three
other times in the past - the homes of the nation, the units in the
foundation of government, that determine the perpetuation of our great
Democracy. You by the power of money can turn back the clock of time
from civilization to the dark past. For no power on earth to man for
evil or for good can equal the power of money.

Proposed Legislation to Repeal the Federal Reserve Act
Congressman Henry Gonzales introduced in Congress the following
legislation which was referred to the House of Representative's
Committee on Banking and Currency. The actual bill calling for the
Repeal of the Federal Reserve Act is as follows:

A BILL
"To vest in the Government of the United States the full, absolute,
complete, and unconditional ownership of the twelve Federal Reserve
banks.

Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled, that:

(a) the Secretary of the Treasury of the United States is hereby
authorized and directed forthwith to purchase the capital stock of the
twelve Federal Reserve banks and branches, and agencies thereof, and
to pay the owners thereof the par value of such stock at the date of
purchase.

(b) All member banks of the Federal Reserve System are hereby required
and directed to deliver forthwith to the Treasurer of the United
States, by the execution and delivery of said documents as may be
prescribed by the Secretary of the Treasury, all the stock of said
Federal Reserve banks owned or controlled by them, together with all
claims of any kind or nature in and to the capital assets of the said
Federal Reserve banks, it being the intention of this Act to vest in
the Government of the United States the absolute, complete, and
unconditional ownership of the said Federal Reserve banks.

(c) There is hereby authorized to be appropriated, out of any funds
not otherwise appropriated, such sums as may be necessary to carry out
the purposes of this Act.

Paul Luther's Case

United States District Court

_______________DISTRICT OF_______________

PAUL NEAL LUTHER,
SUMMONS IN A CIVIL ACTION
Plaintiff,
CIV93 0484 SC
v. CASE NUMBER_____________________

UNITED STATES OF AMERICA,

Defendant.

TO: (Name and Address of Defendant)
U.S. Attorney General, Washington D.C.
Department of Justice, Room 4400
Main Justice Building
10th & Constitution Ave., NW
Washington, DC 20530
(202) 514-2001

YOU ARE HEREBY SUMMONED and required to file with the Clerk of this
Court and serve upon

PLAINTIFF'S ATTORNEY (Name and Address)
Paul N. Luther (Pro Se)
6505 Natalie Ave. NE
Albuquerque, NM 87110
(505) 884-5735

an answer to the complaint which is herewith served upon you, within
__60__ days after service of this summons upon you, exclusive of the
day of service. If you fail to do so, judgment by default will be
taken against you for the relief demanded in the complaint.

ROBERT M. MARCH, Clerk
[CLERK]

APR 15 1993
[DATE]

[Signature]
[BY DEPUTY CLERK]

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO

PAUL NEAL LUTHER,

Plaintiff,
CIV93 0484 SC
v. No.___________________

UNITED STATES OF AMERICA,

Defendant. LORENZO F. GARCIA
U.S. MAGISTRATE JUDGE

COMPLAINT: THE U.S. FEDERAL GOVERNMENT IS PRINTING PAPER MONEY WHERE
IT HAS NO POWER TO DO AND IS, THEREFORE, UNCONSTITUTIONAL.

Plaintiff alleges:
THE FEDERAL GOVERNMENT OF THE UNITED STATES OF AMERICA has been
printing paper money, which it has no power to do and is, therefore,
unconstitutional. Article I, Section 8, of The Constitution of the
United States of America states at clause five:

To coin Money, regulate the Value thereof, and of foreign Coin,
and fix the Standard of Weights and Measures;

This phrase allows the Federal Government to "coin Money" and
"regulate the Value thereof" only. There is no specific enumeration of
power for Congress to emit or print paper money or any other medium of
exchange other than coin. More importantly, during the Federal
Convention of 1787 the Founding Fathers (Founders) directly addressed
the issue of printing paper money, which was also referred to at the
time as "emit[ting] bills." The Founders took explicit and direct
action to exclude this power from the Federal government and the State
governments.

The following excerpt was taken from the Notes of Debates in the
Federal Convention of 1787, Reported by James Madison, (W. W. Norton &
Company, p. 389, 1987). On Monday, August 6, 1787, the following draft
Constitution was presented to the Convention, quoted in part here:

Monday August 6th. [1787] In Convention
VII

Sect. I. The Legislature of the United States shall have the power
to lay and collect taxes, duties, imposts and excises;
To regulated commerce with foreign nations, and among the several
States;
To establish an uniform rule of naturalization through the United
States;
To coin money;
To regulate the value of foreign coin;
To fix the standard of weights and measures;
To establish Post-offices;
To borrow money, and emit bills on the credit of the United
States;
To appoint a Treasurer by ballot; . . .
(emphasis added)

On Wednesday, August 15, 1787, the following discussion about
"emit[ting] bills" was made at the Convention (id. at 470-471):

Wednesday August 15. [1787] In Convention

Mr. Govr. Morris moved to strike out "and emit bills on the credit
of the U. States" - If the United States had credit such bills would
be unnecessary: if they had not, unjust & useless.

Mr. Butler, 2nd the motion.

Mr. Madison, will it not be sufficient to prohibit the making them
a tender? This will remove the temptation to emit them with unjust
views. And promissory notes in that shape may in some emergencies be
best.

Mr. Govr. Morris, striking out the words will leave room still for
notes of a responsible minister which will do all the good without the
mischief. The Monied interest will oppose the plan of Government, if
paper emissions be not prohibited.

Mr. Ghorum was for striking out, without inserting any
prohibition. If the words stand they may suggest and lead to the
measure.

Col. (note 1 below) Mason had doubts on the subject. Congress he
thought would not have the power unless it were expressed. Though he
had a mortal hatred to paper money, yet as he could not foresee all
emergences, he was unwilling to tie the hands of the Legislature. He
observed that the late war could not have been carried on, had such a
prohibition existed.

Mr. Ghorum. The power as far as it will be necessary or safe, is
involved in that of borrowing.

Mr. Mercer was a friend to paper money, though in the present
state & temper of America, he should neither propose nor approve of
such a measure. He was consequently opposed to a prohibition of it
altogether. It will stamp suspicion on the Government to deny it a
discretion on this point. It was impolitic also to excite the
opposition of all those who were friends to paper money. The people of
property would be sure to be on the side of the plan, and it was
impolitic to purchase their further attachment with the loss of the
opposite class of Citizens

Mr. Elseworth thought this a favorable moment to shut and bar the
door against paper money. The mischiefs of the various experiments
which had been made, were now fresh in the public mind and had excited
the disgust of all the respectable part of America. By withholding the
power from the new Government more friends of influence would be
gained to it than be almost any thing else. Paper money can in no case
be necessary. Give the Government credit, and other resources will
offer. The power may do harm, never good.

Mr. Randolph, notwithstanding his antipathy to paper money, could
not agree to strike out the words, as he could not foresee all the
occasions which (note 2) might arise.

Mr. Wilson. It will have a most salutary influence on the credit
of the U. States to remove the possibility of paper money. This
expedient can never succeed whilst its mischiefs are remembered, and
as long as it can be resorted to, it will be a bar to other resources.

Mr. Butler remarked that paper was a legal tender in no Country in
Europe. He was urgent for disarming the Government of such a power.

Mr. Mason was still averse to tying the hands of the Legislature
altogether. If there was no example in Europe as just remarked, it
might be observed on the other side, that there was none in which the
Government was restrained on this head.

Mr. Read, thought the words, if not struck out, would be as
alarming as the mark of the Beast in Revelations.

Mr. Langdon had rather reject the whole plan than retain the three
words ("and emit bills").

On the motion for striking out
New Hampshire ay.
Massachusetts ay.
Connecticut ay.
New Jersey no.
Pennsylvania ay.
Delaware ay.
Maryland no.
Virginia ay.*
North Carolina ay.
South Carolina ay.
Georgia ay. (note 3)

1. Footnotes to above excerpt The word "Mr." is substituted in the
transcript for "Col."
2. The word "that" is substituted in the transcript for "which."
3. In the transcript the vote reads: "New Hampshire, Massachusetts,
Connecticut, Pennsylvania, Delaware, Virginia, *North Carolina, South
Carolina, Georgia, aye-9; New Jersey, Maryland, no-2.
* This vote in the affirmative by Virg. was occasioned by the
acquiescence of Mr. Madison who became satisfied that the striking out
the words would not disable the Govt. from the use of public notes as
far as they could be safe & proper; & would only cut off the pretext
for a paper currency, (note 4) and particularly for making the bills a
tender (note 5) either for public or private debts.
4. The transcript italicized the works "paper currency" and "a
tender."
5. The word "was" is here inserted in the transcript.

Had there been no mention of "emit[ting] bills," which was also
referred to as paper money or paper currency during the Convention
debates as shown above, there may be a slight justification for
assuming the Founders did not totally shut the door to paper emissions
Even then, it would be very doubtful that this was an implied power
when one considers James Madison's definitive statement from The
Federalist (Hamilton, Alexander; Jay, John; and Madison, James;
Original Text, Random House, Introduction by Edward M. Earle, p. 303,
1937) on the powers of the Federal Government, namely:

The powers delegated by the proposed Constitution to the federal
government are few and defined.

The Federalist No. 45

And, Col. Mason's concern about the power to emit bills in the debates
of August 15, 1787, in that he thought Congress (Madison, supra, at
470):

. . . would not have the power [to emit bills] unless it was
expressed.

But the issue of printing money by the Federal Government was
specifically addressed in the Convention, and there is no doubt that
the Founders intention was to exclude paper emissions from the Federal
Government. How much clearer to the Founders intent can there be made
than nine States voting to strike "and emit bills on the credit of the
U. States," an overwhelming majority, and only two voted in favor of
leaving the words as presented in the draft constitution on August 6,
1787. Had the Founders wanted to leave the door open to paper money
they could have just as easily left the words as presented in the
draft.

Also, these excerpts confirm beyond a doubt that the Founders had a
clear understanding of the term, "coin money." At the time, as it does
now, this referred to the use of alloys, such as gold and silver, to
be struck into coins through the minting process. And as for the
"regulation of the value thereof," it was common knowledge then, as
now, that this meant the establishment of the relationship to a
specified quantity of alloy, such as gold or silver, to a specific
monetary unit. As an example of the understanding of the time, Thomas
Jefferson wrote in his Plan for Establishing Uniformity in the
Coinage, Weights, and Measures of the United States, Communicated to
the House of Representatives, July 13, 1790, (The Library of America,
Library of Congress Catalog Card Number: 83-19917, p. 407) the
following about the value of coins:

Let it be declared, therefore, that the money unit, or dollar of
the United States, shall contain 371.262 American grains of pure
silver.

Additional evidence demonstrating that the Founders were well aware of
the terms "coin money" and "emit bills" can be found in The
Federalist, a compilation of eighty-five (85) essays that were used to
explain the meaning of the proposed Constitution prior to its
ratification. When referring to the powers of the Federal Government
as they relate to money, James Madison wrote (Hamilton, Jay, Madison,
supra, at 276):

The Federalist No. 42
(Madison)
All that need be remarked on the power to coin money, regulate the
value thereof, and of foreign coin, is, that by providing for this
last case, the Constitution has supplied a material omission in the
articles of Confederation. The authority of the existing Congress is
restrained to the regulation of coin struck by their own authority, or
that of the respective States. It must be seen at once that the
proposed uniformity in the value of the current coin might be
destroyed by subjecting that of foreign coin to the different
regulations of the different States.

The punishment of counterfeiting the public securities, as well as
the current coin, is submitted of course to that authority which is to
secure the value of both.

Similarly, when referring to the States, James Madison wrote
(Hamilton, Jay, Madison, supra, at 289):

The Federalist No. 44
(Madison)
A FIFTH class of provisions in favor of the federal authority
consists of the following restrictions on the authority of the several
States.

1. "No State shall enter into any treaty, alliance, or
confederation; grant letters of marque and reprisal; coin money; emit
bills of credit; make any thing but gold and silver a legal tender in
payment of debts; pass any bill of attainder, ex-post-facto law, or
law impairing the obligation of contracts; or grant any title of
nobility."

...The right of coining money, which is here taken from the
States, was left in their hands by the Confederation, as a concurrent
right with that of Congress, under an exception in favor of the
exclusive right of Congress to regulate the alloy and value. In this
instance, also, the new provision is an improvement on the old. Whilst
the alloy and value depended on the general authority, a right of
coinage in the particular States could have no other effect than to
multiply expensive mints and diversify the forms and weights of the
circulating pieces. The latter inconvenience defeats one purpose for
which the power was originally submitted to the federal head; and as
far as the former might prevent an inconvenient remittance of gold and
silver to the central mint for recoinage, the end can be as well
attained by local mints established under the general authority.

The extension of the prohibition to bills or credit must give
pleasure to every citizen, in proportion to his love of justice and
his knowledge of the true springs of public prosperity. The loss which
America has sustained since the peace, from the pestilent effects of
paper money on the necessary confidence between man and man, on the
necessary confidence in the public councils, on the industry and
morals of the people, and on the character of republican government,
constitutes an enormous debt against the States chargeable with this
unadvised measure, which most long remain unsatisfied; or rather an
accumulation of guilt, which can be expiated no otherwise than by a
voluntary sacrifice on the altar of justice, of the power which has
been the instrument of it. In addition to these persuasive
considerations, it may be observed, that the same reasons which show
the necessity of denying to the States the power of regulating coin,
prove with equal force that they ought not to be at liberty to
substitute a paper medium in the place of coin. Had every State a
right to regulate the value of its coin, there might be as many
different currencies as States, and thus the intercourse among them
would be impeded; retrospective alternations in its value might be
made, and thus the citizens of other States be injured, and
animosities be kindled among the States themselves. The subjects of
foreign powers might suffer from the same cause, and hence the Union
be discredited and embroiled by the discretion of a single member. No
one of these mischiefs is less incident to a power in the States to
emit paper money, than to coin gold or silver. The power to make any
thing but gold and silver a tender in payment of debts, is withdrawn
from the States, on the same principle with that of issuing a paper
currency.

Even though Madison is here referring to the States, how can an
argument explaining the destructive and detrimental effects of paper
money not also be true for the Federal Government? The record of
history is clear on the subject.

Why was it necessary for the Founders to specifically state that no
State shall "emit bills" and for it to not to be so specifically
addressed in a similar fashion for the Federal government? The
Founders were well aware of the destructive and detrimental effects of
papers money and excluded the power from the Federal Government, and
to ensure that the State governments did not print paper money the
Founders had to explicitly state so, otherwise the States would have
had the power. At the time it was understood that those powers not
enumerated in the Federal Constitution were left to the States or to
the People. James Madison stated in The Federalist, No. 45 (Hamilton,
Jay, Madison, supra, at 303) that:

Those [powers] which are to remain to the State governments are
numerous and indefinite. The former [Federal Government power] will be
exercised principally on external objects, as war, peace, negotiation,
and foreign commerce; with which last the power of taxation will, for
the most part, be connected. The powers reserved to the several States
will extend to all the objects which, in the ordinary course of
affairs; concern the lives, liberties, and properties of the people,
and the internal order, improvement, and prosperity of the State.

This was later reemphasized in the Tenth Amendment to the Federal
Constitution, "The powers not delegated to the United States by the
Constitution, nor prohibited by it to the States, are reserved to the
States respectively, or to the people."

WHEREFORE, the damages to myself and to the Country are substantial,
and if no action is taken to correct this error, future damages
through the Federal Government's inflation and the other pestilent
effects of paper money will certainly occur - as the records of
history show. It is not my intent to receive a monetary award for my
damages, but to see that this error is corrected by having the Court
require that the Federal Government refrain from printing paper money
and do exactly what the Federal Constitution at Article I, Section 8,
Clause S requires, so future damages do not occur to myself, my family
or the citizens of the United States of America. This error has
occurred due to the specious reasoning of the U.S. Supreme Court, and
the error continues to persist do to the Court's decision to rely on
faulty case law. By taking an oath to uphold and defend the United
States Constitution, it is the Court's responsibility to correct this
error by following the true intent of the Constitution and refrain
from writing law.

[Signature] 04/15/93
___________________________________________

Paul N. Luther (pro se)
6505 Natalie Ave., NE
Albuquerque, NM 871 10
(505) 884-5735

"I hereby certify that a copy of the
foregoing pleading was mailed to
opposing counsel/parties of record
on the _____ day of ___________
19_____."

The Free Enterprise Solution
All the initiatives, that I've come across so far, to do something
about the "banking problem" have been very useful in that they've
helped educate me. They've also helped educate a great number of other
people. These initiatives basically involve campaigns to persuade the
U.S. Congress to change the system. My guess is that through these
campaigns about 10,000,000 Americans have been educated to see the
Federal Reserve system as the great evil it is.

The Free Enterprise solution is to create alternative systems to
outcompete the Fed. Some of these systems are already in operation.

We also need to implement "Riegel-type" systems. Such systems are
based on the principles expounded by E.C. Riegel about 50 years ago in
his book Private Enterprise Money.

Then we also need private coinage - probably gold and silver coins.

In order for the above free-enterprise alternatives to outcompete the
monopoly systems, maybe 100,000 participants would constitute a
critical mass. In other words, if we can persuade 1% of the Americans
who see the Federal Reserve system as evil to participate actively in
our free-enterprise alternatives, the game is over for the monopoly
systems!

And what about the so-called "national debt?" Well, for people who
exit the monopoly systems the "national debt" simply becomes a joke.
The people who choose to remain in the monopoly systems will be able
to play to their hearts' content with their "national debts" and phony
funny money!



Dale Spencer



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