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Brutus’ Warning

May 24, 2012 by  

Most the Framers and Ratifiers of the U.S. Constitution feared paper money. For that reason, Article I, Section 8, which deals with credit, commerce and coinage, was a much-discussed section.

As the consensus moved toward restricting the issuance of paper money and establishing a sound money policy, the Framers pondered what to do about the government’s debt. Many argued that, without the ability to print money, there was no way to discharge the debt. But the Framers knew from experience that printing money led to inflation. So Clause 5 — which restricted money to coins — was inserted to negate the effects of fiat money. Clause 2 of the section, which gives Congress the power to “borrow money on the credit of the United States,” was finally settled upon, though not without objection.

The anti-Federalist Brutus — probably New York’s Robert Yates — wrote in Brutus, No. 8:

Under this authority, the Congress may mortgage any or all the revenues of the union, as a fund to loan money upon, and it is probably, in this way, they may borrow of foreign nations, a principal sum, the interest of which will be equal to the annual revenues of the country.–By this means, they may create a national debt, so large, as to exceed the ability of the country ever to sink. I can scarcely contemplate a greater calamity that could befal (sic) this country, than to be loaded with a debt exceeding their ability ever to discharge. If this be a just remark, it is unwise and improvident to vest in the general government a power to borrow at discretion, without any limitation or restriction.

Even though he understood where Clause 2 would lead, I doubt Brutus could have foreseen a debt exceeding $15.7 trillion.

Bob Livingston

is an ultra-conservative American and author of The Bob Livingston Letter™, founded in 1969. Bob has devoted much of his life to research and the quest for truth on a variety of subjects. Bob specializes in health issues such as nutritional supplements and alternatives to drugs, as well as issues of privacy (both personal and financial), asset protection and the preservation of freedom.

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  • Vicki

    The OP writes
    ————————–
    Clause 2 of the section, which gives Congress the power to “borrow money on the credit of the United States,” was finally settled upon, though not without objection.
    ————————-

    Apparently the objections were quite sound and should have been listened to. Having an entity borrow wealth when they do nothing to create wealth to pay it back was and is indeed a serious problem.

    • GALT

      I suppose it is an interesting characteristic of humans to talk of creating things……but
      it becomes somewhat difficult to define what is actually taking place when one tries to
      assign any realistic value to things which have a nebulous connection to anything which is
      more a product of imagination, than something that can be quantitatively demonstrated.

      How does one “create” wealth? Or jobs? Or any number of other things which for all intents and purposes are dependent on the perceptions and agreement of “others”
      rather than having any actual intrinsic value in it’s own right?

      It is clear that we have the capacity through our imaginations to “create” many things
      which have no valid connection to the physical universe to which we are inextricably bound
      and this is not in itself a bad thing. The danger here lies in the tendency to expand on these constructions which results in systems of ever increasing complexity……which have no realistic foundation to exist at all………..they are in fact illusions, which can not be sustained………and like all such constructions, the more we are dependent upon them, the more catastrophic the consequences, when actual reality eventually asserts itself……..

      • Vicki

        GALT pretends to not know the most simple of the principles of wealth creation by writing
        ——————————————-
        How does one “create” wealth? Or jobs?
        ——————————————

        You create wealth by work. You create jobs by trading some of your wealth for some of someones time to help you work to create wealth. In a truly free market this is all done by consent of the trading partners. Informed consent is strongly preferred.

        As with humans from the earliest of days we instantiate wealth by possession of physical objects. Knowing this you can immediately see why socialism and communism will ALWAYS fail. Socialism allows no possession of private property. Communism allows no possession of private property. Thus wealth can in theory be created but is owned by nobody/everybody so there is no incentive to work to create the wealth.

        For evidentiary proof I offer the entire history of applied Socialism and applied Communism throughout recorded history.

        And just one little example from our history.
        http://www.thinking-catholic-strategic-center.com/Colonial-Communism.html

      • GALT

        And you Vicki pretend to know what wealth is and then
        state that what you believe it is “material possessions”…..
        …..and then you make further false statements regarding
        economic systems in relation to private property……and
        then in error, confuse these economic systems with political
        systems which claimed to be operating under them and
        point to their failure……..and then you further compound
        this error by claiming that history supports your contention
        that…………”applied socialism and applied communism”
        have failed…….which leaves us to infer…..because you
        fail to mention it that; “applied capitalism has succeeded?

        As you have indeed created a complex system of “ideas”
        which is based on a “perception” that “wealth” is the
        “possession of physical objects” and then proceed
        to expand this to all manner of conclusions, deconstructing
        this becomes fairly simple.

        First, perceived wealth may indeed be the desire to possess
        physical objects, but you make no quantitative or qualitative
        distinctions regarding the intrinsic value of these objects nor
        any connection made between work and wealth, nor any
        historical evidence or support for your mythical construction
        of free markets or trade, with the economic systems
        which you claim have “failed”.

        History has demonstrated that civilizations rise and fall,
        and no degree of wealth or land was capable of sustaining
        them, nor were any of the economic theories you cite
        responsible for this failure, since they did not exist at that
        time………yet in each case, reality asserted itself, so that it
        is clear that whatever the cause of these failures, there is no
        causal connection to wealth as it relates to material possessions
        and private property, and the inability of these civilizations to
        sustain themselves………nor did the “perception” of wealth
        prevent their collapse………….so if wealth is indeed what you
        claim, then it has no value or connection to reality…….
        since reality did not care.

        The economic systems you cite are fairly recent and are
        defined in terms of the ownership of the means of production
        …………..and again we are faced with the reality that no actual
        value can be quantitatively or qualitatively assigned to any of
        the components you cite as being part of this reality…….yet
        it is clear, that whatever capitalism actually is, it is built on
        an ill defined, unstable and constantly shifting foundation,
        so much so, that it’s failures were evident from the very
        beginning, and directly responsible for the creation of the
        systems you cite as having failed………when in fact is was
        the political system in place which claimed to be
        operating under these ‘systems” which failed……..and one
        can find each of these economic theories and myriad
        variations there of, presently operating all around the world,
        and all of them are failing…….because none of them are
        based in reality, and they are therefor “unsustainable”,
        with the only major difference between now and in the past,
        is that when collapse occurs this time, because civilization is
        now “global”, it will be a “complete collapse” which has altered
        the reality that exists to such an extent, that systemic recovery
        may not be possible……..

        It is of course tempting to desire things to be simple and
        it is also rather common for people to believe that they
        are………….history is littered with the corpses and evidence
        of the failures of this desire and the fact that it is not TRUE,
        no matter how many people wish it was. Reality is not
        subject to desire…..empirical truth does not require your
        agreement or belief……all debts incurred will be paid.

        We are, as a global civilization, on an unsustainable
        trajectory, whose continuation will result in complete
        systemic collapse………failure to understand this and
        make the required adjustments will simply accelerate
        the process……

        Yet the mythologies which brought us to this point, and
        the evidence that clearly demonstrates the consequences
        of continuing…….is being DENIED by more mythology
        which claims 1.) the present mythology is working just fine.
        ( which it isn’t ) 2.) That more of what doesn’t work and has
        never worked is the solution. ( which it is not ) and finally
        3.) That technology and it’s prospects which seemed to
        have helped us avoid reality in the past will provide the
        magic bullet to save us in the future. ( when all this was
        simply a matter using up the natural wealth available
        at unsustainable rates creating a debt which will come due
        in the future and can not be avoided. )

        This is why economics has no valid claim as a science
        or discipline despite the mystical mathematical constructions
        they invent to support their mythology, and why any such
        system which does not take into account the reality which
        permits it to exist in the first place, will ultimately cause it
        to fail, regardless of any temporary benefit that may
        seem to suggest the stability of the illusion.

        Clearly, those who benefited in the past from this illusion,
        believed they were in control and that this was stable
        and would continue forever……history has demonstrated
        that it was not true then and it is not true now. That this
        time is NOT different!

        What may be true is: ” That the lesson of history
        is that we have learned NOTHING from history.”

      • Vicki

        GALT speaks a lot and says nothing useful and fails to stay on point. (The point being what is wealth). It would take the better part of several books to counter most of his points and I’m not writing a book today.

        So instead I will follow one little piece of his thread bare writing.

        ———————————————————–
        History has demonstrated that civilizations rise and fall,
        and no degree of wealth or land was capable of sustaining
        them, nor were any of the economic theories you cite
        responsible for this failure.
        ———————————————————-

        Rather than writing a book I offer this little video which happens to discuss what happened to the Republic of Rome and how it compares to the Republic of the USA. You will note from the video that Rome fell when government started stealing significantly more wealth from its citizens. Thus you see that wealth and who steals it does directly affect (some) civilizations.

        http://www.youtube.com/watch?v=N4r0VUybeXY

        • http://www.facebook.com/profile.php?id=100001912092010 Walter Back

          Thank you Vicki; Very interesting and great presention video how governments work. So what do we have here in America? and where are we heading and why?

      • vicki

        “So what do we have here in America? and where are we heading and why?”

        As Ben Franklen said at the beginning of the video. A Republic. If we can keep it. Since we have been following the same path that Rome did you can clearly see where we are heading.

    • http://www.facebook.com/profile.php?id=100001912092010 Walter Back

      For this country to have a unlimited credit card to borrow money from foreign nations and not have a congress approved budget is beyound a serious problem it’s insane. The American taxpaying citizens have been betrayed by the slick politicians in Washington D.C. and do nothing! Now thats sick.

      • Vicki

        The US does not have an unlimited credit card. There is a debt ceiling/cap/limit. However since the borrower (US Government) can raise that limit whenever it wishes the effect is about the same as unlimited.

        Just imagine if you could go to your credit card company and just raise your credit limit whenever you wanted to. No need to ask the company representative. How long would such a company survive.

        • http://www.facebook.com/profile.php?id=100001912092010 Walter Back

          Vicki; My point here is we the people, the taxpayers, have no say where our tax dollars go even if there was a budget/credit limit but at least with a budget we would know where the money is going and the next election cycle we have a choice. As to Nicolas comment for a third party vs voting for the lesser of the two evils we have today that needs some real thinking because the choice we have today isn’t working for this great nation and it may be time to get back to our founding fathers views.

    • http://www.facebook.com/profile.php?id=100001912092010 Walter Back

      Vicki; My last reply in reference to video presention should be presentation. Sorry my spelling is not always good but hope you got the point.

      • vicki

        I think so :)

  • ONTIME

    We now have a government run amuck…huge debt, massive taxation, uncontrolled government intrusion into the private sectors, less secure borders, illegal alien intrusions ect, ect……

    There is a huge need for term limits salary only for all government electees and appointees, there is considerable need to decertify illegal government unions, there is great need to eliminate agencies such as the IRS, NEA, there is reason to remove the progressive income tax and use a national sales tax…WHAT WE NEED IS TO REPARE THIS GOVERNMENT and restore our representation.

  • Nicolas

    We are the ones to blame. We keep electing the same parties and the same idividuals over and over. We derserve the type of government that we elect to represent us. When they fail to represent our best interest, then it is time to start voting for third parties.
    We need to quit voting for the lesser of the two evils and start voting for principle.
    This is why I belong to the Constitution Party.
    Nicolas Lomas

    • GALT

      Actually, in order to reflect the actual displeasure of the population regarding the current actions of government, what is required is “None of the above” included as a choice
      available for every office. If this option wins……none of the people currently on the ballot
      can be included in the subsequent elections for this post, and the office will remain vacant until filled. ( since government doesn’t seem to want to actually DO anything, there is no point in having to pay for it. )

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