Saturday, February 28, 2015

200 Years Ago, We Didn't Have To Explain "Where Money Comes From" To All Citizens. More Knew Then Than Do Now!

   (Commentary posted by Roger Erickson)

Battle Over Banking: A Public Bank for the Republic of Vermont (1803)

The first part is is a fascinating historical story, for multiple reasons. 

First, for the mere fact that a savvy set of state legislators had it right from the beginning, like multiple American Colonies had done, previously

(Just like John Law had pointed out. Maybe he could read some Greek?)

Second, for the chilling story of how widespread bank monopolies conspired to do away with the Public Bank of Vermont.

Nothing much changes? The bank lobby is still winning, so far. Keeping us from further coordinating our own returns.


Roger Erickson said...

This doesn't even come close to what's really needed?

Dan Lynch said...

Interesting history, thanks for posting.

Lincoln's economic advisor Henry Charles Carey fully understood modern money theory.

Progressives of the late 1800's advocated "greenback" money, and later "free silver" which accomplished the same thing in a roundabout way.

Today's progressives are mostly clueless. :-(

Anonymous said...

"200 Years Ago, We Didn't Have To Explain "Where Money Comes From" To All Citizens."

The Vermont State Bank was set up as a specie reserve bank, with 100% required specie reserves for the first $25 thousand issued, and a requirement after that point to never fall below 33% reserves.

It didn't issue fiat or chartal money.

Matt Franko said...

"In 1804, the Vermont legislature recommended that the arguments regarding banking be put before the people, and that a vote on a banking bill be held in 1805. This was done, and the proponents of banking made a good case that banks would solve the many problems that Vermonters faced, including counterfeiting, inefficiency, and the draining of capital by out-of-state (“foreign”) banks."

Send to Varoufakis and Galbraith they both seem oblivious to this still today... at least to my knowledge this has never come up from either of them...

Roger Erickson said...

Thanks Dan.

No one said the original state bank of Vermont did issue fully fiat currency, although several of the prior colonies had done just that.

Main point is that the state bank was openly conceived, via public discussion, as an institution to serve the Vermont public, rather than banksters.

Do you have any more links about the details of the outset, workings & eventual demise of the Vermont state bank? Lots of details are missing.

Anonymous said...

Roger, I was just citing information from the article you linked to.

Peter Pan said...

When will the communists in North Dakota and their state bank be dealt with?

Roger Erickson said...

"When will the communists in North Dakota and their state bank be dealt with?"

As soon as they look worth looting, ... to Goldmans Sachs et al.