The need for constant war

buy+war+bondsHere’s a couple of glimpses I have had into real life courtesy of people more plugged in to reality …

The first is a luncheon I attended years ago, a place where I was out-of-place among shakers and movers in our little town of Billings. Seated next to me was Jim Bennett, president of First Citizens Bank. During the course of the conversation  he told me two things: One, that when the Federal Reserve decided to build a building in Minneapolis, it merely created the funds out of whole cloth. There was no accountability, he said. It’s an entity unto itself.

Second, he noted that during World War II every workplace and newspaper echoed the “Buy War Bonds” plea. He said the real reason behind that drive was not to raise money, as the government could borrow and create all that it needed elsewhere. There just wasn’t much in the marketplace to buy, so that the government needed to get money out of circulation to keep prices down. Although there were price controls in place, we all know the black market quickly becomes the real market in an ersatz pricing structure.

The second glimpse came from Buckminster Fuller, who recounted the days leading up to U.S. entry into World War One.

In 1914, three years before the U.S.A. entered the war, J.P. Morgan, as the “Allies” fiscal agent, began to buy in the U.S.A. to offset the line-of-supply losses accomplished by the enemy submarines. Morgan kept buying and buying, but finally, on the basis of sound world-banking finance, which was predicated on the available gold reserve, came the point at which Morgan had bought for the British and their allies an amount of goods from the U.S.A. equaling all the monetary bullion gold in the world available to the “ins” power structure. Despite this historically unprecedented magnitude of the Allied purchasing it had only fractionally tapped the productivity of the U.S.A. So Morgan, buying on behalf of England and her allies, exercised their borrowing “credit” to an extent that bought a total of goods worth twice the amount of gold and silver in the world available to the “ins.” As yet the potential productivity of the U.S.A. was but fractionally articulated. Because the “ability to pay later” credit of the Allied nations could not be stretched any further, the only way to keep the U.S.A. productivity flowing and increasing was to get the U.S.A. itself into the war on the “ins’” side, so that it would buy its own productivity in support of its own war effort as well as that of its allies.

By skillful psychology and propaganda the “ins” persuaded America that they were fighting “to save democracy.” I recall, as one of the youth of those times, how enthusiastic everyone because about “saving democracy.”

(Emphasis added)

All other issues aside, existence of a gold standard created a barrier that even powerful men like Morgan had to honor.

These days we have a Federal Reserve which has the power to create money, its only restraint the impact of that creation process on the real economy. They have to mind their manners. But given that power (and a voluntary obligation we have taken upon ourselves to pay the Fed interest on created-out-of-whole-cloth currency debt), it appears that the money system is not at all what we think it to be. It’s a house of cards.

If our currency has any backing at all, it is the oil standard. Oil is priced in dollars, and countries that need to buy oil must have dollars in reserve for that purpose. Countries that monkey with the oil standard are quickly brought to justice – the stakes are incredibly high. Iraq, Libya, and to an extent Venezuela, have traded outside the dollar system and have suffered mightily for it. Iran in 2006 created an “oil bourse,” a currency window for oil not denominated in dollars. It still exists, but I don’t hear much about it. I imagine recent negotiations with Iran around the fake nuclear weapons issue discussed the bourse in detail. (In addition, the BRICS are mounting an open challenge to the dollar.)

Americans who work and make a decent living are forced to turn over 25-50% of our earnings in taxes … why? Since our currency is fiat, government can spend as it wishes without regard to the tax system. But if all of our earnings were to be left in our own hands, the economy would quickly spiral out of control. Permanent war creates the justification for those taxes, in effect controlling demand, just as during World War II.

Instead of using our wealth to create a consumer utopia, finance our retirements, build a better country [with health care and quality education] we turn it over to the government, which turns it over to private corporations that make weaponry. Those weapons are then sent into wars around the world and destroyed. They have to be constantly replaced. That way our wealth burns up before our eyes without affecting the price structure or making us all millionaires. (If everyone is rich, no one is rich.)

Up until the invention of nukes, we had hugely destructive wars of global reach. From 1950 forward, we still needed wars, but they changed in nature. They became regional conflicts with no military objective designed merely to burn off wealth.

Since we need constant war, we also need enemies, and are in constant search of them. When the U.S.S.R. went poof, we invented “terrorism” as an enemy to take its place. When we lost our wars in Syria and Iraq, we invented, funded and armed ISIS to give us a new threat to counter. ISIS is a classic invented enemy.

None of this is new, Orwell wrote about it in 1984. What I wonder is this: If we lived in a world without war, would we really be better off? War prevents everyone from being rich, keeps us struggling. It fosters inventions and a constant need for rebuilding. It is not done for foolish purpose. It is done so that we can survive.

About Mark Tokarski

Just a man who likes to read, argue, and occasionally be surprised.
This entry was posted in American terror, History. Bookmark the permalink.

7 Responses to The need for constant war

  1. steve kelly says:

    Back to effective tax rates, fiat currency and the soverign right to issue one’s own money. These seem like the keys to breaking the perpetual-war mold. These issues also represent the most likely unifying target of a rebellion made up of commoners from the right and left. The forces that divide us are well funded, well planned and not likely to roll over without a fight to the death. They know from experience just how much, and when, to push and when to back off. Clever that 1%.


  2. steve kelly says:

    Forgot the accompanying link.


  3. steve kelly says:

    I like it….. Neither, however, would be allowed on today’s Clear Channel (“free-market”) monopoly.


  4. Big Swede says:

    Peace in our time.


    • Is that Neville Chamberlain?

      Here’s something new for you: Chamberlain was part of a British/American faction of financiers and industrialists that wanted to see Germany strengthened in order that it might attack Russia. So the “Peace in our times” public utterance had nothign to do with the real scheming that was going on behind the scenes.

      And that same lesson should be applied today: Never trust the public words of politicians. They are meant only for effect and carry no substance.


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