Monetary and credit reform: full-employment, end of debt slavery

This is my paper for The Center of Process Studies’ conference, Money-Creation in a Finite World (free and open to the public, April 10-12, 2012; Claremont Colleges, CA):

Money and credit as public services for full-employment, optimal infrastructure, ending debt slavery: Epic proponents, related history of US government and corporate media, partnership for Occupy victory

It’s divided into these 11 parts for articles (links added with each new section):


Monetary and credit reform is a policy objective to end transfer of trillions of the “99%’s wealth to an oligarchic “1%.” The US banking collusion only and always co-exists within a larger oligarchy with government for legal protection, and media for public propaganda. This paper presents histories in monetary reform and US government crimes in war suppressed by today’s US corporate media’s history texts and news journalism. When the oligarchy’s voice is professionally exposed as obviously and egregiously lying in omission and commission in claims of central importance of the past and present, government and corporate media loses credibility in an “emperor has no clothes” transformation. Refutation of the oligarchy’s voice with objective and independently verifiable facts, especially in light of current War Crimes and Constitutional destruction, supports our policy goal for monetary and credit reform because the public will seek alternative voices to build a brighter future. To support our goal of upgraded economic policies, we should be open to synergy with ecological and resource-based economic models, and network with Occupy.



“Look, if you think any American official is going to tell you the truth, then you’re stupid. Did you hear that? – Stupid.”                                                                                                 – Arthur Sylvester, Assistant Secretary of Defense for Public Affairs, 1965, at a Vietnam press meeting as reported by: Hammond, William M. Reporting Vietnam: Media and Military at War, 1998.

The purpose of economic research is improved economic policies. With the Occupy Movement, the US “99%” have unprecedented opportunity to reclaim their monetary and credit systems from a Robber Baron-era created 1% oligarchy that includes accomplices in government and media. Importantly, monetary and credit manipulation is only possible with government to protect oligarchic policies and profits, and media to disinform the 99% from discovery that their wealth is being transferred to the oligarchy. Conversely, monetary and credit manipulation becomes impossible if government stood for policy that benefits 100% of humanity and rejected policy for the 1%’s profits, and/or media alerted the 99% that their wealth was being transferred to an oligarchy.

If Federal Reserve/fractional reserve credit is the 1% literally “making” money for profit and to pay for their protection, government is the 1%’s legal protection along with military to war-steal land and resources, and media propaganda is the 1% literally covering their assets.

An education breakthrough by the 99% in any of these three areas of banking, government, or media makes the other two areas easier to accomplish. Because monetary and credit reform might be the most difficult educational breakthrough, those of us competent in economic language might benefit from seeing and communicating the broader political and media conditions closer to the 99%’s existing understanding.

I teach Advanced Placement Economics, and regularly interact with 2,000+ AP teachers from around the world on our listserve. The consensus among AP Econ teachers is that the subject of how credit is created (what we use for money) is particularly challenging, even to our brightest students. AP teacher training includes the recommendation of teaching this topic with a physical demonstration or other teaching aid (I recommend Paul Grignon’s movie Money as Debt). It is the only curricular topic with such emphasis. Therefore, we might also find this topic particularly challenging to communicate to citizens.

One way to make this educational challenge easier is to prove mouthpieces of current monetary and credit policy, US government and corporate media, as lying in omission by ignoring credible monetary alternatives today and extending back in history, and lying in commission in central policy areas, such as current US War Crimes and a history of lying with US wars.

Importantly, “crime” is the game-changing proof that discredits the oligarchy’s voice. When “emperor has no clothes” obvious War Crimes are recognized, this triggers a significant population with Oaths to uphold US law to arrest the oligarchy’s “leadership.” Upon the 99%’s recognition that government and corporate media voices are literally War Criminals, we remove current economic policies’ voice and open public consideration to historic and current wisdom for monetary and credit reform.

History in any area helps give depth to present understanding. I’ll provide some; with monetary reform, and damning evidence of 160 years of US government and media lies in wars. Both areas of history are easily revealed with objective and independently verifiable facts. The facts easily prove a long history of US government and corporate media lies and crimes, with attempt today to cover-up those crimes with tragic-comic lies in history texts.

If we can demonstrate a long history of credible work for monetary and credit reform thwarted by political manipulation and then covered-up by media, then this historical wisdom is reclaimed for consideration in the present. In addition, if related government manipulations and media cover-ups (such as US wars for looting) can be demonstrated to have a long history, then the argument of a US oligarchy operating today to control our monetary system and credit might be recognized by the 99% as the 1%’s usual operating procedure.

That is, if our monetary and credit reform arguments can draw-upon as required that US government and corporate media tell obvious and game-changing lies to cover-up US Wars of Aggression from the 1846 war with Mexico up to today’s wars, then anything they claim regarding money and credit can be recognized as coming from the very same lying sacks of spin.

This opens a stronger listening for what we have to say about monetary and credit reform.

And after all, American adults seem to be attracted to well-told history. History (formerly The History Channel) is a top-rated television show. [1]

Destroying government and corporate media’s voice with history might be a point of access for us because last I checked there were no top-rated shows about economics.

Public recognition of government and corporate media as lying sacks of spin is at an unprecedented level. US corporate media is heavily concentrated in just six corporations. [2] Just as only one in five Americans report trust and satisfaction with their government  [3] (and here [4]), Americans also perceive corporate media disinformation and are rejecting their “reporting.” According to a 2007 poll by the Pew Research Center,[5] the majority of the American public see the US major media news organizations as politically biased, inaccurate, and uncaring. Among those who use the Internet, two-thirds report that major media news do not care about the people they report on, 59% say the news is inaccurate, 64% see bias, and 53% summarize their view on major media news as, “failing to stand up for America.” In their latest poll, [6] “just 29% of Americans say that news organizations generally get the facts straight, while 63% say that news stories are often inaccurate.”

June 2010 Rasmussen poll [7] found 66% of voters “angry” at the media, with 33% “very angry.” Rasmussen also found 70% “angry” at current federal government policies.

Indeed, an “emperor has no clothes” public recognition of US War Crimes past and present, and/or economic crimes of looting trillions of the 99%’s dollars, might relatively quickly lead to arrests of the criminal 1%’s leaders.

Because the purpose of our monetary and credit reform work is policy realization, Occupy is an obvious partnership. The histories of thwarted monetary reform, and government and media lying about US wars establish those voices as discredited. This places our arguments in a stronger light to be recognized by the merits of their facts.

That is, the 99% can conclude it unnecessary to suffer through obfuscating Federal Reserve “econo-speak” [8] when they understand related government and media voices should be rejected based on their proven lying past.

Please include these histories in your communication toolbox. Whenever they empower your work in monetary and credit reform as the right tools at the right time, please use them.

What is monetary and credit reform? 

Since the coup of the Federal Reserve, the US has had a national “debt system;” the Orwellian opposite of a monetary system. What we use for money is created as a debt, with the  consequence of unpayable and increasing aggregate debt.

Monetary reform creates debt-free money as a public service for the direct payment of public goods and services. This would replace the existing system of creating what we use for money out of debt; [9] both from the Federal Reserve issuing credit for US federal debt instruments charged to taxpayers with interest, and private banks issuing credit through fractional reserve lending.

Closely related is credit reform that replaces parasitic private bank credit with public credit.[10] This transfers interest payments from private profits to public service.

These accurate definitions, of course, require understanding of their benefits compared with the costs of our existing “debt system” in order to see and feel the trillions of dollars of importance.

What are the benefits of monetary and credit reform?

The benefits include paying the national debt, ending a national debt forever, issuing money and credit for full employment, and optimal infrastructure. The prima facie case of benefits should undergo professional multiple and independent cost-benefit analyses. The facts that a Federal Reserve-type debt-based system causes unpayable debt, unemployment, inflation, and decaying infrastructure [11] is relatively easy to demonstrate.

Debt begone: Monetary reform [12] pays the national debt of over $15 trillion dollars virtually without cost, and ends its gross $400 billion+ annual interest payments. This saves the ~100 million US households an average of ~$150,000 in total debt cost, with ~$4,000 gross annual interest cost. Another way to calculate the savings is to figure those amounts per $50,000 annual household income (for example, if your household earns $100,000/year, you save $300,000 in national debt costs and $8,000 every year in gross interest).

The way the national debt is paid nearly cost-free is to use government-created money to pay the debt securities as they are due instead of what is done today: never pay them and “roll them over” (re-issue the debt to existing owners or issue new debt to pay for redeemed debt instruments) while only paying the interest. What is done today is similar to only paying the interest on a credit card with ever-increasing debt total. The inflationary effect of paying the debt will be counteracted by simultaneously removing private banks’ fractional reserve authority proportional to the payments (increasing banks’ reserve requirements).

When government has authority to transparently create money, a national debt becomes a tragic-comic part of history. Trial and error will inform total money supply, with an option of removing money from the supply through some form of simple taxation. For example, if public credit issues mortgages at 2%, this form of taxation can pay for public goods and services with the ability to raise or lower the interest rate. Again, proposals such as these should be subject to professional and independent cost-benefit analyses.

Full employment, optimal infrastructure, falling prices: Government can become the employer of last resort for hard and soft infrastructure investment. This provides triple benefits for employment, the best infrastructure we can imagine, and falling overall prices to the extent infrastructure investment contributes more economic output relative to costs of inputs. History demonstrates [13] infrastructure investment does reduce overall prices in the current debt-funded model that typically adds ~50% of the projects’ nominal cost to its total cost. Monetary reform with infrastructure means the cost of debt-funding disappears, making this employment even more attractive.

Additional anticipated benefits are reductions of crime and other social costs related to human despair as people see and participate in creating a brighter future for all.

Other likely benefits: Banking and related industries are not the only cartels to be broken. Others include so-called “health insurance” and pharmaceuticals, energy, and war. Among the most stunning areas are the 99%’s trillions invested and recorded in various government agencies’ Comprehensive Annual Financial Reports (CAFRs). These areas will also release literally trillions into the US economy every year. An excerpt from How an economics teacher presents Occupy’s economic argument, victory: [14]

According to the US Senate Permanent Subcommittee on Investigations report, [15] these financial oligarchs’ “trading” in non-wealth producing market derivatives increases the price of gasoline for all Americans somewhere from 33 to 60%. Market analysis in other commodities’ “trading” brings the total cost to American consumers of padded prices over $1 trillion every year. This is an incredible increase of prices to US households of ~$10,000 for every $50,000 of annual income!

… For an example to understand what this (CAFRs) means, the University of California system (UC) had a budget deficit that resulted in thousands of students denied enrollment, thousands of staff laid-off, a 32% tuition raise, and a 10% employee pay-cut with furloughs to reduce education days. The deficit could have been fully-funded withless than one-fifth of one percent [16] of California’s documented investments. And no, the amount required for retiree benefits is only one-half of one percent of the total; that’s the specious and usual “official” lie. The above link will walk you through those trillions, if this is of interest.

The cartels taking billions of our dollars are in many industries. Dr. Marcia Angell, former Editor in Chief of the New England Journal of Medicine and currently a Senior Lecturer at Harvard Medical School documents: [17]

“The combined profits for the ten drug companies in the Fortune 500 ($35.9 billion) were more than the profits for all the other 490 businesses put together ($33.7 billion).”

Importantly, “profit” is distinct from “research” in understanding these figures. This isprima facie evidence of unlawful collusion among a cartel, yet government doesn’t investigate. Dr. Angell concludes [18] that US government will never provide universal health care because both political parties’ “leadership” obeys health insurance companies’ lobbyists rather than legislate for the public good. The lack of health care kills about 45,000 Americans every year according to the recent study championed by Harvard’s Medical School. [19] Cost-benefit analyses range between $100 to $300 billion annual cost increase [20] to the US by keeping health care companies between doctors and patients. That is, Americans would collectively save $100 to $300 billion every year with universal health care, no insurance companies, and no administrative red tape.

Ecological and resource-based economies “occupying” our dreams: Monetary and credit reform might be short-lived reforms that bridge into a technological revolution for public goods and services so advanced that money and credit considerations become partially obsolete. Bucky Fuller, [21] a personal friend for the last two years of his life, predicted unleashed technology will create competition for part-time public service jobs of what constitutes most “work” today. The Venus Project [22] documents existing technology to free humanity from most “work” of the present in a resource-based economy. Both of these visions transcend current paradigms of money and credit. Both work in harmony with our environment and all Earth’s inhabitants.

The Zeitgeist film series features monetary reform and a resource-based economy with The Venus Project. They estimate over 200 million Internet views of their work (I recommend all their films; Ellen Brown consulted on the second movie). We should be aware of emerging opportunities to upgrade our policy interest in monetary and credit reform. For example, Occupy’s victory will remove energy cartel suppressions over multiple energy sources [23] that will change how we view economics and interact with nature.

How can Occupy help deliver monetary and credit reform? How can we help Occupy?

Occupy is our best opportunity to win monetary and credit reform; critical mass already are convinced something is fundamentally wrong with money, even if most individuals cannot articulate facts and solutions. We can empower Occupy with facts and solutions.

My specific contribution in this paper is to remove US government and corporate media’s voices from consideration because their provable lies kill millions, [24] harm billions, and loot trillions of the 99%’s dollars every year.

A fact the 99% understand is criminal financial fraud: a breach of fiduciary trust that causes monetary damages. Most people are ready to learn how “leadership” at the Federal Reserve, Treasury, banks,  finance, investments, politics, etc., are guilty of lies of omission and commission in transferring wealth from the 99% to the 1%. The time is now to outreach to Occupy participants.

If Occupy is successful in educating the 99% of massive “1%” crimes centering in war, money, and media, we’ll have opportunity for a policy platform.  

That said, while I encourage our good faith advocacy, we should prepare for policy development to have a life of its own.

That’s what democracy looks like.



1 The Columbus Dispatch. History network working to retain ratings success. Stelter, B. Dec. 22, 2011

2 Freepress. Ownership Chart: The Big Six.

3 Pew Research Center. Distrust, Discontent, Anger and Partisan Rancor: The People and Their Government. April 18, 2010

4 InfoWars. Dissatisfaction with Government Reaches All Time High. Watson, S. Sept. 26, 2011

5 Pew Research Center Publications. Internet news audience highly critical of news organizations. Aug. 9, 2007

6 Pew Research Center. Press accuracy rating hits two decade low. Sept. 13, 2009

7 Rasmussen Reports. 66% of voters are angry at the media. June 15, 2010

8 consider this translation: Video Rebel’s Blog: Bernanke Double Speak Translated. March 1, 2012

9 Herman, C. Debt-damned economics: learn monetary reform or kiss your assets goodbye. 1 of 2. July 3, 2011

10 Public Banking Institute to explore for resources.

11 Herman, C. Occupy facts: Federal Reserve CAUSES unpayable debt, unemployment, inflation. Nov. 1, 2011

12 Herman, C. Debt-damned economics: learn monetary reform or kiss your assets goodbye. 2 of 2. July 3, 2011

13 Josheski, D. Infrastructure investment and GDP growth: a meta-regression analysis. Social Science Research Network. Sept. 1, 2008 (among many studies).

14 Herman, C. How an economics teacher presents Occupy’s economic argument, victory. Jan. 30, 2012.

15 Herman, C. US Senate: Banksters the new Enron; manipulating markets to add trillions to consumer prices. Nov. 18, 2009

16 Herman, C. CAFR: UC budget fully funded with one-fifth of one percent of state of CA “investments”. May 24, 2010

17 Pharmaceutical industry cover-up revealed in New York Times.

18 Underwood, A. Questions for Dr. Marcia Angell. New York Times. Health. Aug. 12, 2009.

19 Harvard Gazette. New study finds 45,000 deaths annually linked to lack of health coverage. Harvard Science. Cecere, D. Sept. 17, 2009

20 Herman, C. Economic fascism: corporate-directed health care instead of physician-directed public option at cost. March 13, 2010

21 Buckminster Fuller Institute for information. Archives stored at Stanford University.

The Venus Project: beyond politics poverty and war. Jacque Fresco creator.

23 New Energy Information Center.

24 this includes a million children a month from preventable poverty: Herman, C. 1% “leaders” allow a million children to die a month from preventable poverty. Nov. 29, 2011

Note: has blocked public access to my articles on their site (and from other whistleblowers). Some links in my articles are therefore now blocked. If you’d like to search for those articles other sites may have republished, use words from the article title within the blocked link. Or, go to, paste the expired link into the box, click “Browse history,” click onto the screenshots of that page for each time it was screen-shot and uploaded to webarchive. Then switch the expired URLs with webarchived ones of that same information. I’ll update as “hobby time” allows; including my earliest work from 2009 to 2011 (blocked author pages: here, here).

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