The labor journal. [volume] (Everett, Wash.) 1909-1976, 1915-06-18
MONEY MONOPOLY
By THEODORE TEEPE

In modern society two fundamental
things are required for the production
and distribution of wealth. One is
land (raw materially and the other is
money (credit) Work out a plan
whereby these two elements can be
monopolized, and the workers will bid
against each other for their use. They
will then be willing to work for less
than they produce for the privilege of
using these necessities of life. The
monopolizers can then live without
doing any other work than working
the workers. Break these monopolies
and these two necessities will be so
abundantly plentiful that no indivi-
dual can collect a profit from the
workers for their use any more than
that same worker can now be charged
for breathing air.
Land monopoly is effected by our
system of land tenure which makes
it profitable to hold desirable land
out of use. This makes the worker
glad to part with some of his product
for the privilege of living.
Money is monopolized by making it
scarcer than it's demand
A study of the recently enacted fed.
eral reserve act will show in the main
ic
Under this act the United States
was divided into twelve districts. Each
district contains a federal reserve
bank. These banks might be called
the bankers banks. Each national
bank in each district was compelled
to pay per cent of it's capital and
surplus into the big district bank or
quit business. State banks have the
option of becoming member banks.
This is how the system works.
Smith, Jones and Brown who are mer-
chants, farmers, etc, borrow money at
their bank on their notes. After a
while so many borrowers will have
drawn on this bank that it will have
no cash left above it's reserve require
ments. 1t will have plenty of notes.
but no money.
The bank then takes some of these
notes and borrows cash on them from
the federal reserve bank. The re-
serve bank (bankers' bank for this
district is located at San Francisco.
But after a while so many banks will
have borrowed from the reserve bank,
that all of its cash is gone. 1t then
takes some of its notes and deposits
them with the federal reserve board at
Washington, d. c., and the board
starts its printing press and prints
the money for the reserve bank.
But here is where the joker comes
in. For every hundred dollars in notes
that the reserve bank deposits with
the board it must deposit forty dollars
in gold as part of the security. This
makes it impossible to issue more
money than two and one-half times the
amount of available gold. 1t can readi-
ly be seen that any Juggling of the
gold supply can cause a violent fluc-
tuation of the money supply and cause
great changes in interest rates.
The board also has the power to set
any interest rate it likes on the money
it prints for the reserve bank. In this
way interest rates can be kept at al.
most any figure the board desires. On
account of this interest making power
a great effort was made by the money
power to control the federal reserve
board
Destroy both the necessity for a
gold deposit and the interest making
power of the board, and the money
monopoly is broken. Money could
then be loaned to anybody having alb
solutely sound security, for nothing
more than the cost of the clerical