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Return of Sovereignty

The rich rules over the poor, And the borrower becomes the lender’s slave.

And it should be our endeavour to keep as much as may be out of debt. Some sell their liberty to gratify their luxury. – Matthew Henry, Commentary on the Whole Bible (1710) 

In the United States, we face not only an economic and political struggle, but also a moral one. Behind the old creaking facade of our two-party system in the U.S. is a chilling reality – we live in a plutocratic system where our sovereignty, both national and individual, is more imagined than real. Bill Still outlines the problem in the video below. (HT @tickerguy / Market Ticker).

As Bill Still outlines, not only has our government forfeited its sovereignty by allowing the Federal Reserve Bank to control the emission of the currency, it has allowed itself to become indebted to banks who create money out of thin air through the fractional reserve lending system.

Our government is no longer a sovereign one as illustrated by this recent quote from Senator Spencer Bachus:

“In Washington, the view is that the banks are to be regulated, and my view is that Washington and the regulators are there to serve the banks,” he said. 

If our elected leaders are there to “serve the banks”, then it makes me think they no longer serve the people.

Our whole economic system is based on debt. Government borrows money to finance its operations. Individuals are encouraged to assume more and more debt in order to expand consumption. We see consumption not only of goods, but also education – assumed to be a requirement to attain an economically viable position – leading to the assumption of crushing levels of debt for many.

From personal experience, debt is the enemy of personal sovereignty. An indebted person no longer works for themselves or their family. Instead, they work for whatever entity they owe the debt to. Today, typically, that entity is a bank or other financial institution. Crushing debt grinds the debtor into dust, makes their dreams seem unattainable, and puts incredible stress on marriage and family life.

Our current state of affairs is a distant cry from the vision held out in the Declaration of Independence.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

But, our natural rights – including the right to hold and dispose of property – are under assault by powerful interests. These interests may not dispossess us of our property or rights in a direct manner. Instead, they have steadily eroded national, state and individual sovereignty. What is impressive, and frightening, is that sovereignty is being destroyed so quickly on all levels. This goes beyond merely state and individual rights versus the federal (or national) government. While in the past I have examined the ill effects of the 17th Amendment – direct election of U.S. Senators and the erosion of our protections under the 10th Amendment, our nation’s illness has progressed far beyond those matters.

The dilemma of today is as much a moral one as it is an economic or political one. It is a matter of a moneyed plutocracy using the monetary system to accumulate more wealth at the expense of everything else. While some actions such as the mobility of capital, wage arbitrage, etc. can be interpreted various ways, there is a pattern of the subversion of sovereignty in order to benefit a relatively small number of wealthy interests which profit by further indebting nations, states, governments at every level and individuals. 

So, what can be done? One idea is outlined in Bill Still’s book No More National Debt. 


Still advocates monetary reform. Essentially, he is calling on nations to revoke the currency monopoly they have granted to central banks while also ending the practice of borrowing money to finance operations. It makes a good deal of sense. It has always seemed absurd that the Federal Reserve lets banks borrow money at almost no cost, but then pays banks more substantial interest to not loan out money. The Federal Reserve’s Primary Dealers trading in U.S. Government securities gives a good indication of who the true powers behind the throne are.

BNP Paribas Securities Corp.
Barclays Capital Inc.
Cantor Fitzgerald & Co.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Daiwa Capital Markets America Inc.
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
HSBC Securities (USA) Inc.
Jefferies & Company, Inc.
J.P. Morgan Securities LLC
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Mizuho Securities USA Inc.
Morgan Stanley & Co. Incorporated
Nomura Securities International, Inc.
RBC Capital Markets, LLC
RBS Securities Inc.
UBS Securities LLC. 

Interestingly, Representative Dennis Kucinich, has proposed through the NEED Act eliminating money as debt. I recommend you read the whole article, but the NEED Act would, amongst other things, do the following:

  • End money issuance as debt instrument
  • Move the FOMC function to the Treasury and require its operations be neither inflationary or deflationary
  • Require lending be granted by Treasury or from private sources with no government backstop
  • Would bar use of depositor funds for lending purposes
  • Effectively end Too Big to Fail (TBTF) by forcing government to borrow only by specific congressional authorization


I suspect the odds of the NEED Act being approved by Congress and signed into law by President Obama are pretty slim. Unfortunately, if something isn’t done soon we can only expect our sovereignty to only erode further. I am in my 40’s now, and can only imagine what future the youth of tomorrow will face. Over at Sovereign Man the problems faced by the young are outlined:

1) Your government-run university tuition is going to go through the roof, saddling you with unfathomable debt before you even enter the world as an adult;

2) Once you graduate, you’ll be the last in the hiring queue;

3) If you do get hired, you’ll be the lowest on the totem pole and the first to be let go when tough times befall your business;

4) Once the labor market eventually stabilizes, you’ll enter your prime earning years with some of the highest tax rates ever seen as your government continues to cannibalize your generation to pay off its largess and indebted entitlement programs that benefited older generations;

5) For your entire working life, you’ll pay into a pension system that is going to be bankrupt by the time you’re qualified to draw on it;

6) More than likely, you’ll never achieve the standard of living that your parents achieved;

7) Whatever wealth your parents accumulated won’t be left to you– the bulk of it will be confiscated by the state (unless your folks were smart enough to plant multiple flags) due to a host of death taxes.

The article concludes with:

Most of all, stop playing by everyone else’s rules. Refuse to be enslaved by the idea that it’s your civic and moral responsibility to pay off the debts of your government’s failures. Cast off the yoke of their control… and summon the courage to live a life by your own design.

The path to prosperity in the Age of Turmoil depends on this ability to reject the old system, declare your economic independence, and carve your own path. 

So, if you think the outlook for sovereignty is grim now, put yourself in the shoes of a young person. You can be sure that the moneyed interests won’t easily or willingly return our lost sovereignty. Ultimately we will have to demand it be returned and then be willing to back it up. In the meantime, it may pay to have a Plan B, just in case the battle to win our sovereignty back doesn’t go according to plan.
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