Why do we allow the Federal Reserve bank to control US money, not Congress as the Constitution instructs?

Question

Our system of money and taxes is so secretive and complicated for the sole purpose of swindling middle and lower class citizens into being unfairly burdened with taxes to pay a national debt based on interest charged to the Federal Government for loans that fund the continuing war in Iraq. Federal Income tax does not pay for services provided by the State, those are direct taxes. Federal income tax pays for the interest imposed by the privately owned Federal Reserve Bank. Please watch Aaron Russo's documentary on Income Tax and then answer the question.

Isn't true that if disagreed with Congresses handling of the economy, you could vote for a new candidate the next election cycle. With a privately owned Federal Reserve Bank, you can't even see a public record of it's decisions and participants. I'm sorry but that is not what the Constitution instructs.

Why do people feel more comfortable with unaccountable invisible men controlling the monetary system of our country and not elected representatives who can be held accountable for their decisions?

Section. 8. of the US Constitution

The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;

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 establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States;

To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;

Why do we ignore the constitution and assume the responsibility and instead trust unknown bankers?

Answer 1

because you can't trust the government with your money,and with wolfowitz in the banks,you can't trust them either,were screwed. wolf wolf wolf in sheeps clothing.

Answer 2

You obviously have a very biased and uninformed view of how money is managed and what is actually written in the constitution. I think it rather ridiculous that you speak as if you do.

I think it is rather ridiculous to accuse the current federal tax system of swindling lower middle and lower classes. You do realize that the federal income tax is a progressive income tax? And you also realize that the top income earners pay more than 60% of all federal taxes while many lower income people pay little or actually no income taxes. They are actually a tax on the whole system. This combined with the ridiculously progressive social security tax and double taxation of corporate profits, I think the people actually paying for government, and receiving the least benefits, are the upper middle and upper classes of the country.

As to the congress controlling the money, isn't it amazing that when this country was founded, there was no federal currency? There is actually nothing that explicitly gives the federal congress the sole power in determining currency. At most the congress can make laws pertaining to, which they did when they created the national bank, which was destroyed, and then the independent Federal Reserve Bank. Having an independent council that does not sway with public opinion is absolutely essential to the economic use of fiat monies, which we use. It is the reason why our currency is what all else is measured in and why foreigners wait in line to get as much US dollars they possibly can.

As to the financing of the national debt, being a massive conspiracy to pay for the Iraq war. There was a national debt before the Iraq war, can you believe it!, and there has been a national debt for much of the United States History.

I am sorry, but do you know what the US military is? Or maybe the roads you drive on everyday? Or maybe the Coast Guard, light houses, federal deposit insurance, and many other services provided by the federal government? These are paid with THROUGH DIRECT TAXES COLLECTED THROUGH THE FEDERAL INCOME TAX. You clearly have little or no understanding of how the federal income tax or taxes in general work in the United States.

Why do you allow the Federal Reserve Bank to control US money? Because there needs to be an independent council to manage the Floating US dollar without being biased due to constituencies and the frequently changing direction of the public opinion winds. There needs to be an organization that finances debt and keeps banks for making irresponsible investments with your money, leading to bank failures and the loss of trillions of dollars from private citizens. There needs to be a organization that will not finance US debt in short term bonds to keep the economy from going into a recession months before an election causing the delayed recession to be much worse than it would have been, election 2000. By the way, there is a difference between a "privately owned" Federal Reserve Bank and what we like to call a regulatory council appointed by the president and approved by the senate... which is what the Fed is.

Keep your obviously biased questions, if you call the statement you con off as a question, to yourself and your socialist liberal conspiracy theorists.

Answer 3

The whole problem with it is that the Federal Reserve bank is run by owners of the largest banks. Do any of you honestly believe these people are not corrupt? This is a total control thing. And to call the person who asked this question a liberal is just ignorant. You're the ignorant one. You continue on with this divided lib. versus con. argument when it is plain to see that Michael's eyes have been opened to the real truth. I only wish there were more people like him instead of the "sheeple" who believe everything that the media tells them and what their party leaders tell them.

Answer 4

If Congress was full of virtuous people yes, but with its well known track record of corruption, no way. we need a neutral party that is loyal to the country NOT to a party. It might seem unfair because of the tax structure and what the money is used for but can you imagine what would happen if they really controlled the purse strings. You thought pork barrel politics was bad now, if they had carte blanche, we would be drowning in pork

Answer 5

Yes, the constituion grants congress to control many acts of commerce and, by extension, the money supply.

So would take an act of Congress to authorize another party to perform this duty on behalf of congress. Something like the Federal Reserve Act of 1913.

Congress did not abdicate their responsibility. They created a system to perform it who is overseen by congress.

Indeed it was designed it be quasi-independent to make it difficult for politicians to meddle with it.


* Regarding the comment: "Federal income tax pays for the interest imposed by the Federal Reserve"

Check the math. Here are the figures:

- Revenue from Income Tax: $800B (approx)

- Interest on the national debt: $160B

- National debt owned by the Federal Reserve: 17%

- Interest paid to the Federal Reserve: $27B

- Interest returned to the Treasury by the Federal Reserve: $25B


* Regarding Russo's film: It is highly disinformation. From the NY Times:

"Facts Refute Filmmaker’s Assertions on Income Tax in ‘America’"

"...examination of the assertions in Mr. Russo’s documentary.. shows... they ... collapse under the weight of fact."

"Many of the reviews in major newspapers have accepted as having some factual basis the film’s main contention, ... even though every court that has ever ruled on these issues has upheld the constitutionality of the income tax.


"... Mr. Russo says ...that the Internal Revenue Service has refused every request to show any law making Americans liable for an income tax on their wages. ... Yet among those thanked in the credits for their help in making the film is Anthony Burke, an I.R.S. spokesman. Mr. Burke said that when Mr. Russo called him asking what law required the payment of income taxes on wages, he sent Mr. Russo a link to documents, including Title 26 of the United States Code, citing the specific sections that require income taxes be paid on wages. Title 26 says on its face that it is law enacted by Congress."

"..Arguments made in court that the income tax is invalid are so baseless that Congress has authorized fines of $25,000 for anyone who makes them..."

"... Mr. Russo says in the film that the 16th Amendment was never properly ratified and thus a tax on wages is unconstitutional. This claim has been made in various forms by thousands of tax protesters since 1913, and so far their batting average with the courts is .000.
To buttress the claim that the 16th Amendment is invalid, the film displays a quotation from a federal district judge, James C. Fox. But the transcript from which the judge’s words were taken shows that while he spoke those words, they were in the context of laying out issues and that the conclusion he reached was the opposite of the words quoted."

(ref: http://www.nytimes.com/2006/07/31/movies/31russ.html?ei=5088&en=05c0d0988f58fc50&ex=1311998400&partner=rssnyt&emc=rs )

* To say the Federal Reserve is private is not wholly true.

The Federal Reserve System is organized with a government agency at the top (the Board of Governors), and branches beneath them that resemble private corporations. (http://www.federalreserveeducation.org/fed101/structure/ )

The Board of Governors are all appointed for 14-year terms by the president and confirmed by congress. It operates per it's charter and laws set by congress. it is overseen by congress. There is no structure or mechanism for private ownership at this level. Board members are forbidden by law to have any economic interest in a private bank.

The 12 branches, however, are organized similar to private corporations. Member banks are required to buy shares in their branch. They can vote for 6 of their 9 board members. The shares get a standard 6% dividend. These shares cannot be sold on the open market. All 'profit' from the Federal Reserve branches are turned over to the Treasury at the end of the year. (that's been about 95% since 1913). Are the Fed branches privately owned? The Fed says 'No' (ref http://www.federalreserve.gov/generalinfo/faq/faqfrbanks.htm#6 ). Courts have ruled that it can be treated as a private corporation for purposes of tort law.


* Regarding the 'anonymous' and 'unknown' people at the Federal Reserve - You can find the members of the Board of Governors at http://www.federalreserve.gov/bios/. You can find the board members for the branch banks at their web sites as well.

Answer 6

Hell, if we had Congress run it, we'd been completely bankrupt by 1845.

God forbid we ever let morons like Nancy Pelosi control the money supply in the US.