Colonialism is the establishment, maintenance, and expansion of colonies in largely ungoverned, less developed territories. The word colonialism comes from the Latin word, Colonus, which means farmer, and most of the first colonies were established by farming land not previously used for agriculture. When ancient civilizations colonized ungoverned or weakly governed territory, they would establish rule over the area usually in order to benefit their foreign government, but they would also live in the new territory. This is one of the fundamental differences between colonialism and imperialism. The word imperialism was derived from the Latin word, imperium, which means “to command,” and this commanding is most often done at a distance or with middle men. Imperialist powers often do not settle in areas they seek to control and profit from. They simply set up proxy governments or trade posts to meet these ends usually to avoid dealing with locals themselves.
Before modern corporations evolved, trade was mostly dominated by governments and wealthy, powerful merchants. Many Roman societies had corporations, but they were not much like modern corporations. They were not nearly as pervasive or lucrative at that time. However, their essential functions were the same.
Most countries on Earth were colonized by one of the European Empires (Spain, Greece, Portugal, France, the UK, Germany, Italy, [especially Rome] and Belgium) or America and their corporations, and most are still controlled by these empires in several ways. Statists of all stripes usually attempt to justify colonialism by claiming that the political and corporate institutions in industrialized nations are superior to simpler cultures that look differently. And they wrongly believe they are entitled to the resources belonging to simpler cultures for this reason.
Before colonization spread, most of world was inhabited by simpler indigenous people who were mostly content to just live their lives in harmony with nature. Very few indigenous cultures now remain intact and most of those that have survived have shrunken considerably. Many of the Aborigines in Australia, the indigenous tribes in Africa, and the indigenous populations of the Americas that lived off of the land were killed by imperial “conquests” and the establishment of colonial regimes.
The Egyptians, Phoenicians, Romans, and Greeks were the first to establish colonies. Ancient Grecian city-states established colonies in North Africa. The Greek government that took over an ungoverned territory was called a “metropolis”, which comes from two Greek words, metro and polis, which mean “mother” and “city,” respectively. The Phoenicians first colonized North Africa in 1100 BC, establishing Utica in Tunisia and later Carthage in 814 BC to enable trade in the Mediterranean. A Greek colony in Naucratis, Egypt was established in 570 BC under Pharaoh Amasis. The Achaemenid Empire, or the First Persian Empire was established in 330 BC by Cyrus the Great. Alexander the Great conquered the whole of Egypt in 332 BC and founded the city of Alexandria where a military headquarters was built.
Initially, governments in Greece were spread out and unorganized. City-states were controlled by separate rulers and no one represented the entirety of Greece, so city-states spread their power individually. Ancient Grecian governments were not incredibly tyrannical at first, but as leagues formed between city-states, governments became more organized, mother-cities became larger, and power became more concentrated. The later Roman Empire was very concentrated in power and its rule spread far beyond that of Grecian city-states. The Eastern Roman, Orthodox Christian Byzantine Empire under Justinian I (527-565) conquered most of North Africa.
Arab and Muslim empires were next to colonize Africa and enslave the populace. The Muslim Rashidun Caliphate conquered Egypt in 641, then Libya in 642, and then Tunisia in 647, eventually losing control in 661. Non-Muslims were not allowed to vote or serve in government. The Muslim Umayyad Caliphate managed to conquer all of North Africa by 711 AD and it began treating non-Muslims as second class citizens. Some Zoastrian monasteries and temples were also sacked after military victories and the Theodosian Code outlawed the construction of new synagogues. Initally, however, the Muslim Empires less aggressively pursued proselytization than the Greeks had.
Madagascar was colonized by Indians and Arab peoples around the year 1000 but it wasn’t until the 14th Century that Arab traders began to introduce Islam. The Muslim Sultanate of Mogadishu (later known as the “city of Islam”) colonized the city in the 10th century mainly to control the gold trade of East Africa though peaceful Muslim immigration had begun long before. The Kilwa Sultanate conquered Tanzania in the 10th century under Ali ibn al-Hassan Shirazi and ruled until 1277. The Muslim Ajuran Sultanate was established in the 13th century and ruled over parts of Ethopia and Somalia, implementing brutal Sharia law. Muhammad Ture also known as Askia Mohammad I founded the Askiya Dynasty in 1493 ruling the Songhai Empire, which controlled modern-day Benin, Burkina Faso, Guinea, Mali, Mauritania, Niger, Bigeria, Senegal, and the Gambia. Askia Mohammad I declared a jihad on the native Mossi people of Central Burkina Faso, leading to a great deal of violence.
The Muslim Sultanate of Darfur was established in 1603 and ruled until 1874. The Wadai Empire, (known as the Ouaddai Empire in France) an offshoot of the Sultanate of Darfur was established in 1635 and ruled modern day Chad and the Central African Republic. The Islamic Bornu empire ruled from 1380 to 1893. This empire was a continuation of the Kanem Empire ruled by the Sayfawa Dynasty. The Islamic government ruled over Chad, Niger, and Cameroon and forced many to convert to Islam but not without resistance from some in the country. In 1903 the Caliphate was defeated by the British and came under British rule. Christian missionaries flooded the country when this occurred, resulting in large numbers of converts. Christians became a majority in South Nigeria while Islam continued to dominate the North, resulting in much conflict between the two. Wealth and political power also became concentrated in the South as they were favored by the British Empire and others, which is still another cause of unrest. The Muslim Sokoto Caliphate also colonized and proselytized West Africa in the 19th Century.
Empires became much more violent during the “Age of Discovery.” Huge advances in technology often make individuals feel much more important than those of us who lack the same technology. European rulers felt entitled to the rest of the world because they developed faster, more efficient modes of transportation, production, and destruction, which always led to greater wealth and power. They argued if the so-called “primitive” peoples they were stealing from were more “advanced,” they would have the means to defend themselves. However, that logic can be used in attempts to justify stealing from anyone.
The Portuguese were the first industrialized Europeans to explore the Northern coastline of Africa in 1418, and they quickly established settlements and trade posts there to trade with Africans. This was in the beginning of the so-called “Age of Discovery.” In 1492 Spanish monarchs funded Christopher Columbus to sail west in order to find a trade route with Asia, but instead he came across the Americas, an uncharted territory. The Spanish and Portuguese governments immediately assumed ownership of the territory (despite the fact that natives had already been living there for thousands of years) and the two empires divided the territory between them to prevent conflict. As mentioned in part one of this book, “one year after Columbo’s [Columbus’s] first voyage, Pope Alexander VI in his Inter Cetera Divina Papal Bull granted Spain all the world not already possessed by Christian states, excepting the region of Brazil, which went to Portugal.”1
Columbus first encountered the Bahamas in 1492, and the indigenous population there was welcoming and generous, but Columbus stole from them, enslaved them, and killed any who interfered due to his religious self-righteousness. When Columbus did finally reach the Americas, he also massacred local natives and stole their land. The Spanish Jews and Muslims were also forced to convert to Christianity or face exile or execution. Columbus was arrested in 1500 with his brothers for accusations of tyranny and incompetence. In Columbus’s Lettera Rarissima to the Sovereigns dated July 7 1503, he claimed he “won” the land by “God’s will”: “What man ever born, not excepting Job, who would not have died of despair, when in such weather seeking safety for my son, my brother, shipmates, and myself, we were forbidden [access to] the land and the harbors which I, by God’s will and sweating blood, had won for Spain?” The fact that many Americans and the government still proudly celebrate Columbus Day is a testament to the racist, genocidal roots of this country that remain and still form the basis of the government today.
The European invasion and colonization of Africa called the “Scramble for Africa” was too motivated by the same kind of greed and entitlement Columbus had, and most of Africa’s governments are still tyrannical and exploitative to this day because the same types of people remain in charge. There is no other continent on Earth that has experienced such extended periods of suffering as Africa has in recent centuries mainly because of the interventions of empires.
The Scramble for Africa took place between 1881 and 1914. Most of Africa had been mapped by European explorers by the middle of the 19th century. Explorers found parts of Africa were very rich in mostly untapped natural resources like gold, diamonds, other precious metals, and oil, so the world’s empires immediately set out to acquire and control the land. (Africa has an estimated $24 trillion in un-Earthed precious metals.2 If common Africans owned the mining industry there, this would transform their socioeconomic conditions.) In 1870 only 10% of Africa was under European control. However, by 1914 Ethiopia and Liberia were only countries in the entire continent that weren’t under European control as most of Africa did not have large armies with the same caliber of weapons as the European empires had to defend itself from them.
In 1869 Henry Morton Stanley, a European explorer, was sent by Leopold II of Belgium to the Congo Region to make treaties with several African chiefs in order to take control of the Congo region, and form the “Congo Free State.” Leopold II then took control of the region in 1885 and began to use it to extract resources like ivory and rubber. Leopold’s stranglehold over the region expanded to Katanga where the previous ruler, Msiri, was beheaded by Leopold’s army, and Leopold set up a terrorist regime there, which massacred and enslaved millions of Africans. During Leopold’s rule which ended in 1908, more than half of the native population of the Congo Free State (about 8 million people) died due to genocide and starvation.3 About half of the native population of the French Congo also died at the same time due to the brutality of the companies that extracted resources from the region like the Compagnie Commerciale de Colonisation du Congo Français, which also received concessions from France. South Africa was of interest to the U.K. for its gold and diamonds and two wars were fought for control over the land. Fighting for control over Africa between European imperial powers ultimately led to the First World War. By 1914 30% of the African population was under British control, 15% was under French rule, 9% under German rule, and 7% under Belgium’s control.4
Human zoos were also set up in major cities like Barcelona, London, and New York where onlookers could gawk at the indigenous people of Africa locked in cages. They attracted hundreds of thousands of visitors every year, despite being grotesque, human rights violations. The native Africans were sometimes caged with apes in a vile attempt to “prove” that Africans were more primitive and closely linked to primates, thereby “justifying” the imperialist genocide and enslavement of Africans.
The majority of the cruelest and most tyrannical dictators in history rose to power in already developed, highly industrialized, capitalist nations, mostly because their society’s development made them feel more important than non-industrial nations. Metallurgy, oil as an energy source, and some of the most significant technological discoveries were made by the empires of Europe and Mesopotamia, and it is partly for this reason that they felt they had the “right” to conquer every other culture. The Scramble for Africa was sometimes referred to as the “white man’s burden,” as if begrudgingly rich, white people had to enslave Africans “for their own good.” Religious extremism also fueled this contemptible self-righteousness as well.
The goal of many Egyptian, Mesopotamian, Arabic, and European rulers was to control and force the people of lands being colonized to produce, exploit the land, and fight for them, thereby accumulating as much capital as possible and destroying anyone who stood in the way. Most empires pursued knowledge, science, agriculture and metallurgy to increase their own wealth and power, whereas other simpler cultures that stayed in Africa or veered to Australia and the Americas during the first human migrations out of Africa were more focused on their communities and relationships with the natural world and other humans.
Proselytization often comes with imperialism and colonization. Many indigenous peoples of Africa, Australia, and the Americas still practice different tribal religions, but the presence of organized religions in these regions grew significantly, especially during the 20th Century. The larger religions have spread mostly because of indoctrination, propaganda, and forced conversion. In 1910 Africa had only 1.6% of the world’s Christian population, but by 2010 Sub-Saharan Africa alone contained 23.6% of the world’s Christian population (or about 520,000 people).5 According to the World Christian Database, in 1900 17% of the world’s Muslim population called Africa home.6 By 2002, Muslims represented 48% of the African population.7
Instead of destroying or converting the financially poor, indigenous peoples of the world, we ought to be learning from them. The constant endeavor to accumulate capital does not make life more meaningful. People, the rest of life on Earth, clean air, potable water, and fertile healthy soil are far more important than any technological toy or any amount of money, and many simpler cultures realize that, which is why they haven’t “advanced” in the traditional sense.
Advancements in technology and science are important because they can cure diseases, improve lives, and create more functional, productive, efficient, and sustainable societies. They can also help us come to a greater understanding of our purpose here. However, they can also destroy the world when they are misused and controlled by selfish people. Many technologies require precious metals and fuel to operate and those metals have to be mined, which takes more fuel, which further pollutes the planet. Many of the sustainable practices we need to keep the planet and life on it were invented long ago and are still in use. But they are often eschewed because most people would rather pay for a hamburger at a fast-food chain than sustainably grow crops, hunt, forage, or humanely raise livestock. They do because they don’t realize how much healthier and sustainable the latter is over the former. The “first world” must leave the remaining indigenous peoples who haven’t been slaughtered alone, and those who want and seek out help should be given it without any strings attached. If simpler cultures don’t want contribute to the world economy, they have every right not to, and what empires have done to these people is indefensible.
Capitalism, the essential engine of imperialism, is the fundamental problem because it expands and maintains hierarchical relations in workplaces and the rest of society, thereby driving economic disparity, alienation, and despair. There are many people in the world with little to no capital, which can make them willing to work for pennies (since corporate-states take away their ability to subsist independently off the land) and rich corporations ensure that they do. Most countries with extreme poverty and health-care problems are ignored if they lack a strong export industry or resources because imperial powers do not see a need to lend a hand without a string (or a chain) attached. No leader of any rich government will send the cure for malaria and mosquito nets or enough food and water to dying populations or soldiers to protect inhabitants from violent extremists without the expectation they will receive more in return.
Most of our rulers want these simpler cultures to contribute to the world economy and become industrialized like the rest of the “first world.” It is always quid pro quo. But this process often destroys their cultures, lifestyles, and ideologies and furthers a system that only financially benefits a small “elite” ruling class.
Today, organizations like World Bank and the International Monetary Fund, (IMF) assist empires in their capitalist transformation of third-world countries. These organizations represent the latest trend in imperialism: branding it as “humanitarian aid.” World Bank currently represents 188 countries, but it is governed by just a few wealthy ones, which define its agenda. To become a member of World Bank, countries must first join the IMF and the International Bank for Reconstruction and Development, (IBRD). Both World Bank and the IMF claim their goal is to reduce poverty and create economic growth, but they only subsidize exploitative corporations and employers who they know will provide a high margin of return for them. Essential services are also privatized and deregulated in poor countries to eliminate government oversight, austerity measures are implemented, and those in power profit as a result while the lives of most everyday people deteriorate further.
In 1989 economist, John Williamson, wrote ten economic principles that he believed were the IMF’s and World Bank’s “standard reform package” for developing and undeveloped countries, especially in Latin America. This was later deemed the “Washington consensus.” The second policy is the only real progressive one, which calls for redirection of public spending (subsidies) to education and healthcare, but this is not a policy the IMF or World Bank actually implement. The rest of the ten policies essentially call for unchecked, free-market capitalism that creates debt for the poor and revenue for the rich. He was correct that these are Washington’s primary policies, (excluding the second one) and these policies have devastated the poor of the world. The Argentine economic crisis of 1999, for example, was caused by the application of these kinds of policies. The IMF and World Bank’s loans to poor countries never actually reach poor people. Instead, the money goes to corporations tied to these institutions that clear-cut forests and pollute the natural world to “develop” power-plants, oil refineries, and pit mines that only benefit the wealthy. But the poor pick up the bill for the loan when it comes time to pay, despite not benefiting from it.
Poor people are not generally allowed autonomy or economic self-reliance, so this forces them to work harder and harder usually in more industrial jobs. If they don’t, they will have very few ways to subsist, and they will be forever in debt without sustained resistance to these ultra wealthy parasitical institutions. Multilateral banks like the IMF and World Bank are forcing the “third world” into the “first world” through a process of natural resource extraction, industrialization, austerity, and debt enslavement with many dead along the way. They have commited and continue to commit egregious crimes against humanity and must be held accountable by common people. Multilateral banks will be discussed in greater detail in part three of this book, which will first discuss the rise of modern corporations.
The Birth of Modern Corporations and the Subsequent Growth of Economic Inequality
3.1: Corporations and Imperialism
The world today still has many of the same problems it did 3000 years ago. We are still controlled by the wealthy, parasitical ruling class. Corporations today often portray themselves as distinct from their barbaric predecessors. But some of the very same corporations that helped conquer unindustrialized peoples hundreds of years ago still exist today, and corporations rule as even larger political powers than they ever have before. The Scramble for Africa and many other conquests over land and people were only possible with the help of corporations still in existence.
Corporations have managed to rebrand imperialism and capitalism, giving them a “friendly,” even “philanthropic” veneer. Empires long ago realized they couldn’t just enslave the world without significant resistance, especially with the invention of telecommunications that enable information about oppression and resistance to travel so fast. Therefore, corporations were created to make this process seem not just harmless, but “progressive.” The first modern corporations were created in the 16th century but the very first ancient corporations are far older and were a facet of Ancient Roman society. These corporations were granted nearly as many rights as people by Roman governments when they first were made. Ancient Roman companies had the power to sue each other, and because corporations were recognized as legal entities separate from their owners to reduce individual accountability, the owners often were not individually responsible for debt they incurred. These owners could regulate their corporations in any way they saw fit, as long as what they did wasn’t against Roman law. Much later on, Churches in medieval Europe also became incorporated, as did the Pope.
In Ancient Rome, corporations couldn’t have nearly the amount of power governments had. The state preferred method to control the public was force and governments had the largest armies and the most control over capital. But times have changed. Major corporations secured armies hundreds of years ago and some still have them, (like private military contracting firms) but now they are even able to shape people’s minds and beliefs passively though a plethora of media. Because of this, they are seen not by most people as our enemies but as our friends.
Corporations evolved largely from governments because their primary function is the same: socioeconomic control for profit. But eventually they branched off from governments to create their own complex mechanisms of coercion. Corporations were formed mainly by individuals who inherited wealth and felt entitled to more but who weren’t in a position to steal from countries because they didn’t initially have the manpower. They were mainly calculating, selfish people with a great deal of resources and few scruples who knew how to exploit and steal from countries in ways that their governments did not.
One of the first modern-day corporations with major power to develop that was mentioned in part one of this book was the British East India Company. It was one of the most brutal and violent corporations to exist, and it essentially laid the groundwork for the practices of just about every future major corporation. As mentioned in part one, the company’s brutality eventually resulted in the Bengal Famine of 1770 that killed ten million Indians. The company also sold (literal) tons of opium to China, even after the country made the drug illegal, which caused widespread addiction in China. The British East India Company at one point became almost more powerful than the British Empire. It was also allowed to have armies (as most companies were), and it eventually invaded several neighboring countries, including Pakistan, Malaysia, Bangladesh, Somalia, Burma, Singapore, the United Arab Emirates, and Yemen, and set up proxy governments there that are still in power today. The company was liquidated in 1858 with the passage of the Government of India Act and its functions were formally transferred to the British monarchy, making India an official colony of Britain. India was then under British control for more than a century until 1947 when Indians finally gained some measure of independence. But none of these countries are autonomous or democratically ruled and they are still tied to their “mother country” of Britain and its corporate rulers. Today, corporations don’t need armies because they have governments who will invade for them. But corporations were only able to gain so much control because they pretend to be our friends and convince us of their “necessity,” and we are taught to believe one person’s loss ought to be another man’s gain in the zero sum “game” of life.
3.2 The Rise of Corporate Executives and Bankers in America
American corporations derive much of their power from their status as legal entities “separate” from those who own them. By law corporations are seen as nearly criminally immune “people,” and this means their owners often aren’t held accountable for what their corporations do. This allows corporate executives to steal, pollute, exploit their workers, and even kill people (this is called “corporate manslaughter,” not corporate murder8) without ever serving jail time. They usually just pay small fines or settlements in suits to get the heat off for a while. The same applies to owners of private banks since their banks are corporations as well.
Of course, a corporation cannot be put in jail. It can only be fined, and corporate executives take advantage of this. Most often, it is more lucrative for them to break the law and pay the fines than it is to obey the law and lose business to companies willing to break the law. Corporations’ status as “persons” allows them to enjoy the same rights as people and beyond. IGOs like the UN, sovereign states, and even some temples are also considered legal “persons.” Chancellor of Great Britain, Edward Thurlow, once said“Corporations have neither bodies to be punished, nor souls to be condemned; they therefore do as they like.”9
When the American government was founded, corporations and banks did not initially have much power as they were much smaller and still developing. The “founding fathers” recognized the dangers of giving either institution too much power because corporations in Britain from where they had come like the East India Company had a stranglehold over the economy and government there. The British Empire was greatly in debt at this time after the “Great War for Empire,” during which the British conquered the French colonies in Senegal in 1758, the French sugar colonies of Guadeloupe in 1759 and Martinique in 1762, French trading posts in the Gambia, and the Spanish cities of Havana, Cuba and Manila, Philippines but lost Minorca to the French. To pay their debts, the British government increased taxes on its colonies, including America. But when the British Empire increased taxes on imports (like tea) to America, the American colonies predictably retaliated. Gord Hill explains in his book, “The imposition of taxes incited settlers to demand taxes be imposed only with their consent. In fact, the question of taxes was part of a wide debate about who should control and profit from colonialism, the colonies or the colonial centers.”10 The colonists in America wanted to establish another empire that would exploit the world without being exploited or sharing its spoils like Britain.
The foundation of the American government in reality had nothing to do with the values expressed in the Declaration of Independence or the Constitution. These documents contain notions of freedom for some, but they also allowed for the abduction and enslavement of Africans and the genocide of Native Americans to continue. The founding fathers wanted America to be rich and free for them and their families, but at the cost of freedom and prosperity of others. Many of the founding fathers like James Madison and Thomas Jefferson who wrote these documents were, in fact, slave-owners. Jefferson owned 200 slaves, including women, children, and men. Some of these men like Jefferson also raped and impregnated their slaves. George Washington, America’s first President, also ordered the expansion of American settlements into native American territory in 1790, resulting in several bloody battles for the conquest of Native land. The much revered Constitution and Declaration of Independence were not designed to uphold anyone’s rights. They simply ensured America would be an expanding, exploitative empire and ultimately the most powerful one.
Initially, there was a good deal of citizen control over corporations and banks in America. But eventually companies began to abuse their charters and become more powerful, and smaller businesses lost money as a result. Company towns were born, and corporations hired private armies to keep their workers in line. Corporations also began to buy newspapers, so that they could control what was said about them.
American colonies experimented with commodities as forms of currency, especially tobacco and hard money, (silver and gold) before they decided to try printing and circulating fiat currency. When they did, early colonies printed too much, leading to inflation and the depreciation of its value. Britain was receiving this currency as payment for American debt, but as its value was declining, Britain decided to pass the Currency Act of 1751, which allowed American notes to be used to pay for public debt but prohibited their use as payment for private debts to British merchants. King George’s Currency Act of 1764 extended this prohibition to all colonies and also prohibited the use of all future currency printed in America for private or public debts, forcing colonists to all but abandon their own currencies and only use banknotes from the Bank of England, which were issued with heavy interest. When asked during an examination by the British Parliament in February 1766 why Parliament had fallen out of favor with the colonies, Benjamin Franklin stated “To a concurrence of causes: the restraints lately laid on their trade, by which the bringing of foreign gold and silver into the Colonies was prevented; the prohibition of making paper money among themselves, and then demanding a new and heavy tax by stamps; taking away, at the same time, trials by juries, and refusing to receive and hear their humble petitions.” During the American Revolution, the Continental Congress also issued paper money known as continental currency to fund the war, which depreciated rapidly as too much was printed. After the American Revolution, the government issued its own currency to avoid paying interest to England’s private banks that issued currency.
According to T. Cushing Daniel, author of Real Money Versus Bank Credit as a Substitute for Money (1911) the maxim of the Rothschilds and all private money lenders and printers was““Let us control the money of a country and we care not who makes its laws.””11 Mayer Amschel Rothschild and Nathan Rothschild gained substantial stake in the first private, central bank of America called the First Bank of the US chartered for twenty years by Congress on February 25, 1791 to issue currency with interest. 70% of the bank was owned by foreigners according to Dr. Thayer Watkins of San Jose State University.12 Thomas Jefferson and James Madison were opposed to private banking but Alexander Hamilton who may have had ties to the Rothschilds argued for it and convinced Congress. Due to the massive speculation of the bankers, their attempts to increase the prices of US debt securities and bank stocks, and their over-extension of credit, the US experienced its first banking “panic” of New York in 1792. Hamilton responded by bailing them out with taxpayer money. Another banking panic followed in 1796 and continued into the following year. This panic was influenced by the Bank Restriction Act of 1797, which removed the requirement that the Bank of England convert its paper currency to gold on demand, thus depreciating its value. The Bank of England pushed for this Act after printing more fiat currency than it had gold to back in order to fund Britain’s war against Revolutionary France.
In the midst of a new economic crash caused by the First US Bank, the twenty year charter for the Bank expired on March 3, 1811 and Congress repealed the application for renewal of the charter, to which Nathan Mayer Rothschild allegedly responded “Either the application for renewal of the charter is granted or the US will find itself in the most disastrous war.”13 This was no idle threat. The Rothschild’s Bank of England financed the war of 1812 to force the USG back into subjugation under the private banks in the US and the Bank of England. (However, it would be wrong to interpret this to mean there would have been no war of 1812 without the Rothschilds. There were many causes for this war independent of them and all bankers, such as the conscription of US citizens into the British Royal Navy and England’s wish to prevent the US from aiding Napoleonic France.) Private bankers in the northeast US refused to finance the American side, so the US instead obtained funds from London’s Barings Bank.
In 1814 Britain began blockading US trade, resulting in massive shortages, steep inflation, and nearly causing a bankruptcy of the US economy. Britain was also suffering from the loss of trade along with heavy military losses, (Napoleon’s first reign ended in 1814 and the British no longer had a reason to stop American trade with France), so a treaty was signed, ending the war. After the war, a new twenty year charter was issued for the Second Bank of the United States, another private bank modeled on the First Bank of the US. The same problems existed with the Second Bank, causing unemployment and depreciation. The Baltimore office of the bank also engaged in fraud and larceny, leading to another Panic in 1819.
As the Second Bank’s charter neared its expiration, Andrew Jackson fought intensely against its renewal, claiming the Second Bank was a corrupt, unconstitutional institution that favored the super wealthy over the majority of the public. When a Philadelphia committee of citizens met with President Jackson in February 1834 he remarked, “Gentlemen! I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I have determined to rout you out, and by the Eternal, I will rout you out!”14 Jackson’s efforts succeeded and the President of the bank, Nicholas Biddle, arranged for the conversion of the bank to a state chartered corporation just weeks before the original charter expired. Without its responsibilities to the public and the power it was once afforded, the bank liquidated in 1841. Shortly after the banks charter was denied renewal, an attempt on Andrew Jackson’s life was made on January 30, 1835.
During the Civil War, private banks offered to finance the Union via loans with interest rates varying from 24-36%.15 In an attempt to avoid the usury of the private banks, Lincoln issued US government notes and demand notes or greenbacks (so named because of the green ink on the backside of the bills) instead that bore no interest. After his assassination, however, the greenbacks were taken out of circulation and the private banks once again began issuing currency with interest.
Corporate executives and bankers became much richer and more powerful during the Civil War, because they helped finance and sell supplies for the war, taking advantage of government’s “need” for corporations. They induced several financial panics in the 1800s and in the 1886 Supreme Court case of Santa Clara County v. Southern Pacific Railroad, a court stenographer wrote that corporations are “natural persons.” This statement was cited by many corporate lawyers who argued corporations deserve the same rights as people, despite the fact that the written statement was not a legal decision or even an instruction. Many massive corporations and their lawyers have argued that corporations deserve the rights given to people guaranteed by the 14th amendment, which states: “No state can deprive any person of life, liberty or property without due process of law.” This amendment was written mainly to give these rights to newly free slaves, but the argument was adopted regardless and it worked.
Corporations have also argued that they have the “right” to give unlimited capital to politicians because they define donations as a form of “speech” for corporations who are also legally “people.” (If this does not make sense to you, this is because your sanity is intact.) Corporations already utilize just about every media outlet that exists to express their opinions. They clearly have a far louder voice than most individuals do, so to allow them to make unlimited donations to politicians is nothing short of iniquitous.16
Jumping ahead in time briefly, the Federal Election Campaign Act of 1971 was one of the first Acts to attempt to regulate campaign donations, and it required contributions to federal campaigns be more transparent. In 1974 the Act was amended to place legal limits on campaign contributions and create the Federal Election Commission. Provisions of the Act were ruled “unconstitutional” in the case of Buckley vs Valeo and the act was amended as a result in 1976. The Act was amended again in 1979 to allow anyone to contribute unlimited sums of hard money (political donations regulated by the FEC) to efforts that would increase voter turn out and registration.
The Bipartisan Campaign Reform Act of 2003 banned soft money contributions (unregulated political donations) to campaigns and placed some other limits on hard money contributions. But seven years later in the case of Citizens United v. the FEC in 2010, the Supreme Court voted in favor of the conservative PAC Citizens United, (likely due to corporate pressure and bribing) ruling that limits on campaign expenditures by nonprofits was a “violation of free speech” and this was later extended to for-profit corporations as well.
The Supreme Court case of McCutcheon v. FEC in 2014 held that Section 441 of FECA, which imposed a limit on contributions one can make over a two-year period to national party and federal candidate committees is unconstitutional, further eroding the regulatory power of the FECA. Now, the floodgates have been opened for unlimited campaign contributions by corporations seeking more power from the state at a time unlike any other in American history. The FEC now has very little power to do anything about the ability of corporations to buy political power as it is made up of three democrats and three republicans who rarely agree on anything of significance and fail to reach a consensus. The Campaign Legal Center, a campaign finance watchdog has written that the FEC was setup to be weak so that the corruption can continue unabated. In 2015 a bipartisan group introduced a bill that would decrease the number of commissioners on the FEC to five with two democrat commissioners, two republican commissioners, and one independent to break ties when they occur but the bill has not made it out of the committee.
Around the time that corporations were securing their “personhood” at the turn of the century, American banks were also centralizing their power. In 1913, JP Morgan, John D. Rockefeller, and Paul Warburg bribed senators to pass the Federal Reserve Act, which gave private banks control over American currency once again. (Originally, the Federal Reserve was going to be called the Third Bank of US but they decided on a new name to dissociate it from the unpopularity of the first two US Banks.) To make the Federal Reserve seem necessary, rich bankers artificially triggered the Panic of 1907. After signing the Federal Reserve Act in exchange for large campaign contributions, President Woodrow Wilson published a book called The New Freedom: A Call for the Emancipation of the Generous Energies of a People. In it he wrote:
“It is mere truth to say that the financial institutions of the country are not at the command of those who do not submit to the direction and domination of small groups of capitalists who wish to keep the economic development of the country under their own eye and guidance. The great monopoly in this country is the monopoly of big credits. So long as that exists, our old variety and freedom and individual energy of development are out of the question. A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men, who even if their action be honest and intended for the public interest, are necessarily concentrated upon the great undertakings in which their own money is involved and who necessarily, by reason of their very own limitations, chill and check and destroy genuine economic freedom.” – President Woodrow Wilson. 17
The Federal Reserve is highly corrupt because of its dubious role as an institution that is supposed to serve public and private interests, much like the First and Second Bank of the United States. Regional bank boards consist of nine members and three “classes” of members: A, B and C. Class A members represent the banks’ interests. Class B members are supposed to represent the interests of the public, but they are nominated by private, for-profit member banks. Class C members are also intended to represent the public and they are nominated by the board of Governors. But they are encouraged to generate as much revenue as possible by any means necessary. Much of this money goes to the Treasury ($77 billion in 2012), which is responsible for US debt, but everyday people see the least of it. And as of July 2014, America still had more than $17.5 trillion in debt.
One year after the passage of the Federal Reserve Act, WWI began. In part, the war began due to the Scramble for Africa but also because the private bankers saw Germany’s economy as a threat, which had a government controlled central bank, as opposed to a completely private bank, which allowed the government to fund various areas of the economy. When Germany was defeated, it was ordered to pay the costs of the war incurred by every party, three times its net worth. Germany responded with socialism and government issued currency with no interest. Winston Churchill remarked in 1919, “Should Germany merchandise (do business) again in the next 50 years we have led this war (WW1) in vain,” indicating the clear economic motives of the war. By the Great Depression, private banks and other corporations had almost complete control over the American economy and they were making risky and unpopular investments. They were also engaging in predatory lending. Banks had a margin requirement of 10%, which meant they would lend their individual customers $9 for every dollar they had. These loans had incredibly high rates of interest, making private banks a fortune.
Former President Franklin Delano Roosevelt created his “New Deal” Acts in response to the Great Depression, which put restrictions on what corporations and banks could do. One of the most progressive of the acts, the Federal Emergency Relief Act (FERA) allocated $500 million for soup kitchens and direct cash payments to people in need. The New Deal Farm Security Administration Program increased black ownership of land in Holmes County to 70% and according historian and civil rights activist, Charles Cobb, also encouraged “black independence and mutual cooperation, including armed self-defense.” The New Deal Acts also gave more than 20 million unemployed individuals jobs, building sewer systems, schools, and repairing bridges. Many of these jobs were created by the Civil Works Administration. In 1935 this administration was replaced by the Works Progress Administration (WPA) and the Social Security Administration. The WPA also employed millions and its Federal Art Project in 1936 employed 2200 fine arts professionals. In 1933 20.6% of the population was unemployed, but by 1945 only 1.9% of the population was unemployed largely due to FDR’s economic measures. (Industries making equipment and weapons for WWII also put many to work.) Large corporations were predictably unhappy about this public sector work (even though the New Deal was moderate considering the circumstances), and so they conspired against the president.
In 1934 a number of representatives from JP Morgan, Good Year Tire, Remington Steel, Dupont and others actually devised a plan to overthrow FDR and they approached Smedley Darlington Butler to execute it. Butler was a decorated US marine general who followed orders and invaded countries in order to serve the interests of American corporations like the United Fruit Company, so he appeared to be a good candidate. Hugh Samuel Johnson, US army officer and close adviser and speech writer for FDR, told Butler they had an army of 500,000 men and three million dollars to facilitate the coup. They wanted Butler to overtake the White House with them and force FDR to announce that he was ill so that Butler could run the country as a de facto leader.18 If FDR refused, they asked Butler to kill him. However, Butler was sick of working for American monopolies and he refused. He also made their plans known to Americans in a public broadcast, and he later wrote a book about the corporate profits that drive warfare called War is a Racket. If Butler had accepted their plans, one can only imagine what America and rest of the world would look like today. No one went to prison for this plot, most of the congressional record of Butler’s testimony in court was destroyed, and these corporations that plotted against FDR are still some of America’s most profitable. Further, private banks and the other wealthiest corporations still dictate state policy and how economies function, and many of the same ultra wealthy, powerful families continue to run them.
1 Gord Hill: 500 Years of Indigenous Resistance, pg. 13, PM Press, 2009.
2 Kuepper, Justin. “Mining Companies Could See Big Profits in the Congo.” Theotcinvestor.com. October 26 2010. Online.
3 Hochschild, Adam: King Leopold’s Ghost. Mariner Books. 1999. Print.
5 Pew Research Center’s Forum on Religion & Public Life. Global Christianity, December 2011. Print.
7 Encyclopædia Britannica. Britannica Book of the Year 2003. Encyclopædia Britannica, (2003)
8Manslaughter is accidental murder.
9 John Poynder: Literary Extracts. vol. 1, p. 268. 1844.
10 Gord Hill: 500 Years of Indigenous Resistance, pg. 27, PM Press, 2009.
11 Washington: U.S. Govt. Print. Off.: Rural credits. Joint hearings before the subcommittees of the committees on banking and currency of the Senate and of the House of Representatives, charged with the investigation of rural credits, Sixty-third Congress, second session. 1914. pg 771. <<https://archive.org/stream/ruralcreditsjoin01unit#page/770/mode/2up>>
13 Jerry Robinson: Bankruptcy of Our Nation (Revised and Expanded): Your Financial Survival Guide. 2012. pg 103.
14 Stan V. Henkels: Andrew Jackson and the Bank of the United States. (1928) Gollifox Press. <<https://archive.org/stream/andrewjacksonban0000stan/andrewjacksonban0000stan_djvu.txt>>
15 Brown, Ellen: “Revive Lincoln’s Monetary Policy,” April 8, 2009. <<webofdebt.com>>
16 If we let them, it shouldn’t be long before corporations redefine the right to free speech as the right to “Have it your way” at Burger King.
18 New York Times: “General Butler Bares a Fascist Plot.” Newspaper. November 21 1934.