Loose Dollar Dumps Budget Deal
For years and years, the Congress of the United States has failed to name
and ratify a foundation for the U.S. dollar. Now, the White House and the
Congress has the audacity to tell us they have made a budget deal and will
have a balanced budget in five years. I say, "Hogwash," there
will never be a legally balanced budget without first adopting a legal foundation
for the dollar.
What is the real foundation for the dollar? Now sit down with pen and paper
and write down all the necessities of your life, such as food, housing,
clothing, transportation, etc. Where did it all originate? From the soil,
of course, it all began with raw material. Raw material, from whatever source,
just doesn't appear when it is needed; it must be produced by labor. Now
you need some dollars to buy the goods produced by labor from raw material.
So, what is the real foundation for the dollar? The same thing it has always
been, raw material and labor.
Gold had been the declared foundation for the dollar until April 1933 when
President Roosevelt threw it out. He did so because it allowed the banking
system to manipulate the economy instead of the government. He used a pricing
system on commodities and labor to get the economy moving out of the Great
When World War II came along Roosevelt and the Congress froze all wages
and prices in balance for the duration of the war. The level of wages and
prices was elevated sufficiently to create the national income necessary
to finance the war. That period, without a doubt, was the only time in this
century when we had a real honest dollar. It allowed us to pay for the war
without inflation or excessive debt. The wage and price freeze was lifted
soon after the war ended.
When the price freeze was lifted following the war, it was assumed labor,
lumber, oil, minerals and such would take care of their own prices. Agriculture,
which produces 70 percent of all our raw materials, was a different story.
Its production was accomplished by millions of individual producers scattered
all over the nation. In order to stabilize agricultural prices in balance
with the other raw materials and labor, Congress provided support prices
for the storable commodities at 90 percent of parity for the period 1946-50.
Although the Congress never declared raw material and labor as the foundation
for the dollar, it certainly must have assumed that to be so. As evidence,
in 1949, Congress passed a permanent farm bill which authorized the Secretary
of Agriculture to establish certain prices and supply management as necessary
to maintain the balance between agricultural raw materials, labor and other
However, part of the Congress apparently was determined to have a weaker
farm bill with gradually declining price supports for agricultural commodities.
Unfortunately, they won and that was the signal for the money changers who
were ousted from the temple in 1933 to return and take charge. And take
charge they did, with a vengeance. By 1970, the price for commercial seed
corn had increased by 500 percent while the price for the farm-produced
corn had increased only 25 percent.
In 1950, each dollar society paid farmers for their production would generate
$7 of national income. Therefore, had farm-produced raw material prices
been kept in balance, we would earn the national income to finance our economy.
However, the money changers were determined to have a "loose dollar,"
a dollar with no foundation. They apparently not only wanted to lend money
to consumers, they wanted to lend to the government as well. Thus we were
now substituting national debt for national income.
Again, by 1970, the money changers had convinced the government to get rid
of all the grain bins that stored our reserves of corn, wheat and soybeans.
They definitely wanted all government influence out of the marketing of
such commodities. By that time there was a revolving door between the grain
companies. The Secretary of Agriculture was fast becoming the Secretary
of Agribusiness and was soon telling us that parity was obsolete.
In the '70s when OPEC kicked the oil prices sky high the Congress was convinced
to index all entitlements to the rate of inflation but left farm prices,
the real earning power, to float, a loose dollar. Inflation at 3 percent
is the grease that keeps the loose dollar economy afloat. This is what keeps
prices and property values increasing slowly so the money lenders can keep
lending and the people and the government can keep borrowing.
The crowning glory for the money changers, the Agribusiness "Hired
Guns" and all their followers came about when they convinced President
Clinton to sign the "Freedom to Farm Bill." Now with the "Loose
Dollar" nailed down, Congress on a tether and farm prices at 50 percent
of parity, it's all systems "GO." With $180 billion off the top
of farm income and the now $1.8 trillion that it would have generated had
the farmers received it, they can now finance lots of new hog factories
and farm factories for all the grains and soybeans as well. And Hoopty-Do,
more credit cards too. Now you can pucker up and kiss the balanced budget
good-bye before the final deal is signed.
FRANCIS L. YORK
711 N. 7th
Indianola, Ia. 50125
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