Creature From Jekyll Island by G. Edward полностью

The nature of this deception was spelled out years later byCarter Glass in his book, Adventures in Constructive Finance. Fromthis source we learn that, after Bryan had delivered his ultimatum,Glass was summoned to the White House and told by Wilson thatthe decision had been made to make the Federal Reserve notesobligations of the United States government. "I was for an instantspeechless!" wrote Glass who then explained how he reminded thePresident that the only backing for the new currency would be asmall amount of gold, a large amount of government and commercial debt, and the private assets of the individual banks themselves.

"It would be a pretense on its face," he said. "Was there ever agovernment note based primarily on the property of bankinginstitutions? Was there ever a government issue not one dollar ofwhich could be put out except by demand of a bank? Thesuggested government obligation is so remote it could never bediscovered."

To which the President replied: "Exactly so, Glass. Every wordyou say is true; the government liability is a mere thought. And so,if we can hold the substance of the thing and give the other fellowthe shadow, why not do it, if thereby we may save our bill?"1

Years later, Paul Warburg would explain further:

While technically and legally the Federal Reserve note is an obligation of the United States Government, in reality it is an obligation, the sole actual responsibility for which rests on the reserve 1. Glass, pp. 124—25.

THE CREATURE SWALLOWS CONGRESS 467

banks.... The government could only be called upon to take them up after the reserve banks had failed.

Warburg's explanation should be carefully analyzed. It is anincredibly important statement. The man who masterminded theFederal Reserve System is telling us that Federal Reserve notesconstitute privately issued money with the taxpayers standing by to coverthe potential losses of those banks which issue it. One of the morecontroversial assertions of this book is that the objectives set forthat the Jekyll Island meeting included the shifting of the cartel'slosses from the owners of the banks to the taxpayers. Warburghimself has confirmed it.

But let us return to the great deceit of 1913. The second demandmade by Bryan—political control over the System, not bankercontrol—was met with an equally beguiling "compromise." Inaddition to the governing board of regional bankers previouslyproposed, there now would be a central regulatory commission, to