By Félix Dupin
“If a blind man leads a blind man, both will fall into a pit.”
Matthew 15:14
Our media and political elites are doing well telling us, the Canadian populace, that we don’t need to intervene in any way on the Canadian Central Bank (Bank of Canada) interest rates hikes. The Bank is leading us through this world financial crisis, stay confident, carry on, nothing to see here. Indeed, who are we to demand accountability and transparency to our elite actuarians?! Who needs to know how things really work? Just endure a bit more the rough times ahead and stop whining! Only extremists dare elevate their voices against the most pristine institution of our Parliamentary Monarchy. Conservative leader, Pierre Poilièvre, might have electoral impulses leading his charges against the Bank of Canada’s Governor, Tiff Macklem. But instead of educating the public on what needs to be done, it seems Mr. Macklem is just a brandished scarecrow, appealing to the growing discontented mass.
The ‘free market’
In 1933, President Franklin D. Roosevelt intervened to stop the crisis that was leading Europe to adopt fascism as their economic/political system. He did it constitutionally. All of the New Deal’s great projects were founded on a republican-Hamiltonian[1] understanding of economics and a clear vision of national sovereignty vis-à-vis Wall Street and thew City of London. He was blocked by agents enemies of this constitutional order that wanted less power to the popularly-elected Congress and more to them. But Hamilton and Roosevelt understood otherwise, to wit the US Constitution, Article I, Section 8, states:
“The Congress shall have Power…
To borrow Money on the credit of the United States;
To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;
To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;”
With these clear provisions in mind, no one could doubt that the economy is not only a matter for expert economists, but a very political one. George Washington understood the matter after having fought a war of independence against the British Empire. A revolutionary transformation that would not be lost to Adam Smith’s invisible hand! Therefore, he approved Hamilton’s design for the First National Bank of the United States[2]. Indeed, most founding fathers (excluding Thomas Jefferson) understood the necessity of a National Banking system as distinct from the British Central Banking system. The National Bank was adopted not as an interest-rates stabilizing instrument (checking inflation), but as an incubator for groundbreaking development projects: dams, canals, railroad, agricultural improvement, new technologies, etc. The organization of a modern industrial society born out of a struggle with a slave-based Empire[3].
Independence from what?
The economists parroting on the CBC and other channels the line that the Bank of Canada has to above politics is a very nice, but disingenuous thought. The neutrality of the Bank or of any market is a formidable lie, nothing else. Back in 1933, the US Senate Pecora commission revealed to the American public how far the markets had been rigged by the ‘Big players’. Indeed, anglophile families (Morgan, Dupont, et al.) were ‘advised’ to pull out of the market before the infamous Black Thursday crash[4]. Furthermore, they also bankrolled a veterans’ army that was supposed to march on Washington DC to overthrow the government and install General Smedley Butler as a dictator.[5]
Who is naïve enough to still believe the economy is just about natural ‘self-correcting’ cycles? And, especially, not to question our wise economic oracles who never got the cycles right! We should indeed be independent from the oligarchical class that has controlled our nation’s institutions for too long.
It was through the Bank of Canada’s issuance of Victory Bonds which the war against fascism was capitalised with Canadians investing in the growth of their national industries using a public bank as an instrument for both offensive and defensive purposes. Prime Minister William Lyon Mackenzie King understood this power of the bank upon his 1937 nationalization of it when he said:
“Once a nation parts with the control of its currency and credit, it matters not who makes the nation’s laws. Usury, once in control, will wreck any nation. Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of Parliament and of democracy is idle and futile.”
It’s the physical economy, stupid!
As the BRICS nations are carrying a platform of profound international development projects. We, in the West, should rethink how our next move on the Empire’s chessboard is going to be played. Is it possible for Canada to opt-out of this mutually-assured destruction scheme? Is it conceivable that the United States will revert to its republican founding principles and give up the Imperial tendencies it has adopted in the past half century, since the brutal assassination of President Kennedy?
I hope they can, for all of us’ sake. May we embark on a nation-building program away from the natural resources-based economy we’ve had since the debut of North America’s colonization by the Europeans. The limits that were imposed on us are not to be tolerated anymore, nor for some Gaia goddess’ pleasure, nor for the Wall Street invisible hand cultists.
Economics should be a living science, not a dismal one. A science that should be about making living conditions better for everyone, not balancing budgets. Computers can perfectly do the latter, the human mind, not AI, was meant to generate the former. It is with creativity and through science-driven breakthroughs that we will rise from the ashes of the globalized hellhole we slipped into. May it be not too late to regain sight and leave the blinds that have led us awry on a pathway of collision that spell WWIII on the wall.
‘‘To cherish and stimulate the activity of the human mind, by multiplying the objects of enterprise, is not among the least considerable of the expedients, by which the wealth of a nation may be promoted.’’ Alexander Hamilton, Report on Manufactures, 1791.
[1] Alexander Hamilton (1757-1804), was the first Treasury Secretary of the United States, from 1789-1795. See his series of Reports to the Congress; On Public Credit (1790), On a National Bank (1790), On Subject of Manufactures (1791).
[2] Hamilton and Jefferson were asked to give their assessments pro and against the National Bank. Washington sided with Hamilton’s constitutionality reasoning that the bank was to be an instrument to promote the general welfare (common good) of the Union.
[3] The British Empire’s rule of India destroyed its manufacturing capabilities; bringing it backward to a Dark Age level, as well as provoking repeated famines that killed tens of millions. Quite a civilizing experience, isn’t it!?
[4] October 24th, 1929.
[5] Smedley Butler blew up the whole treasonous plot by uncovering its perpetrators’ goals in a public broadcast.