Letter: A sign of economic servitudePublished 10:37am Tuesday, August 27, 2013
Letter to the Editor
Forcing Americans into debt to obtain money keeps us in economic servitude.
“The actual creation of money always involves the extension of credit by private commercial banks. It simply makes book entries for its loan customers saying you have a deposit with us.” —U.S. Treasury.
“Money is created when loans are issued and debts incurred. Money is extinguished when loans are repaid.” —John B. Henderson Sr., Specialist Price Economics, Congressional Research Service.
Imagine that there is no money. An initial $100 is created by simply making a book entry and loaned into circulation at just 1 percent interest.
If the loan is immediately repaid, the total $100 money supply will be extinguished. Some interest debt will remain. No money will exist. More borrowing must occur to have the money to pay the interest on the previous loan. Yet, there is interest debt loan No. 2.
“Money that one borrower uses to pay interest on a loan has been created somewhere else in the economy by another loan.” —John Yetter, U.S. Treasury.
Even if the money supply is simply maintained at $100 or any constant number, the total debt will constantly grow with time and always be more than the money we have to repay with.
This debt destroys the purchasing power of a “dollar,” the ability of most to save, increases the costs of living, tax pressures, money shortages, lowers our standard of living and keeps us in economic servitude in violation of the 13th Amendment.
Gregory K. Soderberg,