For Parts 1 and 2, go here.
America’s Economic Collapse: An Intricate Web of Money, Power and Political Agendas, Part 3
(Author’s Note: There has been comments about the conspiracy theory surrounding JFK and EO11110. This article has two distincts parts; G. Edward Griffin’s take on that theory and the continuation of the “Money Men”. Skip the first part if you want to get back to the Fed quickly.)
There are probably few people that do not know who President John F. Kennedy was, and how he was assassinated on November 22nd, 1963. What is a little known fact is that 5 months prior to his death, he signed Executive Order 11110 amending EO10289. (H/T to TruthIsgold and GM, loyal Monster readers for their input and links.)
THE JFK MYTH
Was he assassinated because he opposed the Fed?
© 2000 by G. Edward Griffin – Updated 2006 December 13
This is in reply to an e-mail I received pointing out the views of the Christian Common-Law Institute regarding an alleged conflict between JFK and the Federal Reserve. It also suggested that this could have been the reason he was assassinated. On their website, the CCLI stated:
On June 4, 1963, a virtually unknown Presidential decree, Executive Order 11110, was signed with the authority to basically strip the Federal Reserve Bank of its power to loan money to the United States Federal Government at interest. With the stroke of a pen, President Kennedy declared that the privately owned Federal Reserve Bank would soon be out of business. President Kennedy’s Executive Order 11110 gave the Treasury Department the explicit authority: “to issue silver certificates against any silver bullion, silver, or standard silver dollars in the treasury.”… Perhaps the assassination of JFK was a warning to all future presidents not to interfere with the private Federal Reserve’s control over the creation of money.
This is what I refer to on page 569 of my book, The Creature from Jekyll Island, as “The JFK Rumor.” I cannot accept this interpretation of history because of the following facts:
THE EXECUTIVE ORDERS
If you look at a copy of EO 11110 you will find that it does not order the issuance of Silver Certificates. It orders an amendment to EO 10289. If you then look up EO 10289, you will find that it says:
The Secretary of the Treasury is hereby designated and empowered to perform the following-described functions of the President without the approval, ratification, or other action of the President.
Those functions did not include the power to issue Silver Certificates. The purpose of EO 11110 was to add that power to the list. The exact wording of the Order was:
Executive Order No. 10289 of September 19, 1951, as amended, is hereby further amended (a) By adding at the end of paragraph 1 thereof the following subparagraph (j): (1) “The authority to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury.”
Therefore, my statement in The Creature from Jekyll Island is correct. EO 11110 did not order the printing of Silver Certificates. It ordered the amendment of a previous executive order so that the United States Code would authorize or “empower” the Secretary of the Treasury to issue Silver Certificates if the occasion should arise.
The occassion did arise between January 1963 and October 1964 with the issuance of 768 million of the 1957B Series, which carried the signatures of Kathryn O’Hay Granahan and C. Douglas Dillon. This was the smallest issuance since 1935, and it was the last. (See “Silver Certificate” at http://en.wikipedia.org/wiki/Silver_Certificate.) Please remember, however; that, EO11110 did not order the issuance of these certificates. It merely authorized the Secretary of the Treasury to do so, which is what happened.
The following additional explanation was contained in a 1996 report from the Congressional Research Service at the Library of Congress:
What E.O. 11110 did was to modify previous Executive Order 10289, delegating to the Secretary of the Treasury various powers of the President. To these delegated powers, E.O. 11110 added the power to alter the supply of Silver Certificates in circulation. Executive Order 11110, therefore, did not create any new authority for the Treasury to issue notes; it only affected who could give the order, the Secretary or the President.
The reason for the move was that the President had just signed legislation repealing the Silver Purchase Act. With this repeal, the Treasury Secretary could no longer control the issue of Silver Certificates on his own authority. However, the issuance of certificates could be controlled under the President’s authority. Hence, for administrative convenience, President Kennedy issued Executive Order 11110.
Ironically, the purpose of the order and the legislation was to decrease the circulation of Silver Certificates, with Federal Reserve Notes taking their place. As economic activity grew and prices rose in the 1950s and early 1960s, the need for small-denomination currency grew at the same time that the price of silver increased. The Treasury required silver for the increasing number of Silver Certificates and coins needed for transactions. But the price of silver was rapidly approaching the point that the silver in the coins and in reserve for the certificates was worth more than the face value of the money.
To conserve on the silver needs of the Treasury, President Kennedy requested legislation needed to bring the issuance of Silver Certificates to an end and to authorize the Fed to issue small denomination notes (which it could not at that time). The Fed began issuing small denomination notes almost immediately after the legislation was passed. And in October 1964, the Treasury ceased issuing Silver Certificates altogether. If anything, E.O. 11110 enhanced Federal Reserve power and did not in any way reduce it.” (See “Money and the Federal Reserve System: Myth and Reality,” by G. Thomas Woodward, Specialist in Macroeconomics, Economics Division, Congressional Research Services, Library of Congress, CRS Report for Congress, No. 96-672 E, July 31, 1996.)
Let’s put this issue into perspective. The proponents of the JFK Myth assert that Kennedy was assassinated because he was about to issue Silver Certificates, thereby denying the bankers their customary interest payments on the nation’s currency. However, the reality was just the opposite. Previously, the President could have issued Silver Certificates on his own authority; but, with the signing of EO 11110, he delegated that authority to the Secretary of the Treasury. At that time, the Secretary of the Treasury was Douglas Dillon from a well-known and powerful banking family. That means Kennedy surrendered the power to issue Silver Certificates and gave it to a member of the banking fraternity who could do with it as he pleased “without the approval, ratification, or other action of the President.” Dillon, of course, would have strong motive to preserve the dominance of Federal Reserve Notes. The theory that Kennedy was getting ready to issue Silver Certificates is without evidence or logic.
The CCLI makes this additional claim in its report:
The Christian Common Law Institute has exhaustively researched this matter through the Federal Register and Library of Congress. We can now safely conclude that this Executive Order has never been repealed, amended, or superseded by any subsequent Executive Order. In simple terms, it is still valid.
This is not supported by the facts. The power granted to the Secretary of Treasury to issue Silver Certificates was rescinded on September 9, 1987, by Executive Order 12608, signed by President Reagan. The official purpose of the Order was stated as “Elimination of unnecessary Executive orders and technical amendments to others.” It did not affect EO 11110 directly but did affect the parent EO 10289 – along with 62 other executive orders. That is how paragraph (j) was amended to remove the power in question. This Order can be found in its entirety in the Federal Register 52 FR 34617.
The picture is blurred by the fact that the Treasury did issue United States Notes in the same year as EO 11110 (1963) but, as discussed further along, U.S. Notes are not the same as Silver Certificates. Furthermore, their issuance had nothing to do with EO 11110. It was mandated by an 1868 act of Congress, which required the Secretary of the Treasury to maintain the amount of U.S. Notes outstanding at a fixed level. This did not originate with JFK and, in fact, he probably had no deep understanding of it. It was a routine matter initiated by the Treasury merely to replace worn and damaged specimens of older Notes in order to comply with the 1868 law. Apparently some of these new Notes did get into circulation but were quickly snapped up by private collectors. They never became a significant part of the money supply and, in fact, were not intended to.
THE SPEECH THAT NEVER WAS
The persistent rumor regarding the bankers’ role in JFK’s death was reinforced by several books circulated in conservative circles. They contained an ominous passage from Kennedy’s speech at Columbia University, just ten days before his assassination. He is quoted as saying: “The high office of President has been used to foment a plot to destroy the Americans’ freedom, and before I leave office I must inform the citizen of his plight.” [Quoted by M.L. Beckman, Born Again Republic, Billings, Montana, Freedom Church, 1981, p. 23; also by Lindsay Williams, To Seduce A Nation, Kasilof, Arkansas: Worth Publications, 1984, p. 26.] However, when Columbia University was contacted to provide a transcript of the speech, it was learned that Kennedy never spoke there – neither ten days before his assassination nor at any other time! Ronald Whealan, head librarian at the John Fitzgerald Kennedy Library in Boston, provides this additional information: “Ten days prior to the assassination he was at the White House meeting with, among others, the ambassador to the United States from Portugal.” [Source: Hollee Haswell, Curator at the Low Memorial Library, Columbia University.]
It is possible that the President did make the remarks attributed to him on a different date before a different audience. Even so, it is a cryptic message that could have several meanings. That he intended to expose the Fed is the least likely of them all. Kennedy had been a life-long collectivist and internationalist. He had attended the Fabian London School of Economics; participated in the destruction of the American money supply; and engineered the transfer of American wealth to foreign nations. (See page 109 of The Creature from Jekyll Island.) There is little reason to believe that he had suddenly “seen the light” and was reversing his life-long beliefs and commitments.
SILVER CERTIFICATES VS. U.S. NOTES
These facts alone should be enough to settle the matter, but there is yet one more point of confusion to be cleared up, and that involves the difference between Silver Certificates and United States Notes. In monetary terms, a Note means a promissory note. A Note is any financial instrument that states in clear and unambiguous terms who is to pay what to whom on what date. All four elements must be included. [See Ewart, James E., Money (Seattle, Principia Publishing, 1998), pp. 27-29.] Therefore, any paper currency that displays a statement such as “The United States Treasury will pay to the bearer on demand twenty dollars in silver coin” is a Note. A Silver Certificate is just one form of a Note. Other forms existed in the past and included Bank Notes, United States Notes, Gold Certificates, and even Federal-Reserve Notes in those by-gone days when they were backed by gold.
Earlier issues of U.S. Notes displayed printed statements to the effect that (1) the bearer could redeem them (2) at the Treasury (3) on demand (4) either for dollars or a specified weight of gold or silver. During those years, a dollar was defined by law as 371.25 grains of pure silver, which was the amount contained in a One-Dollar silver coin. The law also provided that the metal could be in the form of coins, dust, nuggets, plate, or bullion. Therefore, whether the phrase printed on the currency promised dollars, silver, or gold, it ultimately meant precious metal in one form or another – usually coin. Since there was nothing ambiguous about that, those U.S. Notes were true Notes in the legal sense because they contained all four elements of a promissory note.
This tradition began to change in the late 1960s and, since about 1971, U.S. Notes have become very ambiguous, indeed, about what can be redeemed for them. The former clearly written contracts have now been replaced by random, unconnected phrases such as The United States of America; Twenty Dollars: This note is legal tender for all debts, public and private. These words look official and impressive but, in terms of a contract to redeem the currency for something of intrinsic value, they have no meaning at all. Silver Certificates once were a promise to deliver silver. U.S. Notes now are a promise to deliver taxes and inflation.
Even in 1963 when EO 11110 was issued, there were important legal and technical differences in the regulations that governed the issuance of Silver Certificates and U.S. Notes. These words were not used interchangeably. Regulations pertaining to the issuance of Silver Certificates could not be applied to the issuance of U.S. Notes, and vice versa. When EO 11110 authorized the issuance of Silver Certificates, it said nothing about U.S. Notes. The subsequent issuance of U.S. Notes, therefore, had nothing to do with EO 11110. And that is the point of this analysis. Without that understanding, one cannot grasp the significance of the JFK executive orders.
I do not claim to have the final answers on these issues, but this is where our research has led so far. I am open to additional information or interpretation. I would especially welcome a response from the Christian Common Law Institute.
G. Edward Griffin
October 15, 2000
Hopefully Mr. Griffin’s explanation will put some of the controversy to bed on this issue, but that still leaves us with the 7 Money Men who put together the Federal Reserve Act.
Time to jump back into the deep end of the pool. Here are the players whose personal agendas have shaped our country over the last 100 years and who are the Jekyll Island Money Men who crafted the Federal Reserve Act. I believe that it is important to know these men as more than just the names we have heard over and over again in relation to other issues; therefore, the history class.
As stated by G. Edward Griffin, these gentlemen represented 1/4 of all the wealth in the WORLD at that time; I am thinking they were smart and accustomed to getting what they wanted. Please do not be alarmed that we are going a bit backwards, (remember how much the Socialism Series had to jump around?). It is important to have a clear picture of who these men were and how they were connected by blood, marriage, and dynasty, and why you, as the average American, might not trust the Federal Reserve to have your best interests at heart.
The first institution with responsibilities of a central bank in the U.S. was the First Bank of the United States, chartered in 1791 by Alexander Hamilton. Its charter was not renewed in 1811. In 1816, the Second Bank of the United States was chartered. Early renewal of the bank’s charter became the primary issue in the reelection of President Andrew Jackson. After Jackson, who was opposed to the central bank, was reelected, he pulled the government’s funds out of the bank. Nicholas Biddle, President of the Second Bank of the United States, responded by contracting the money supply to pressure Jackson to renew the bank’s charter. The country entered into a recession, and the bank blamed Jackson’s policies. The bank’s charter was not renewed in 1836. From 1837 to 1862, in the Free Banking Era there was no formal central bank. From 1862 to 1913, a system of national banks was instituted by the 1863 National Banking Act. A series of bank panics, in 1873, 1893, and 1907 provided strong demand for the creation of a centralized banking system.
The timeline of central banking in the United States is as follows:
1791-1811: First Bank of the United States
1811-1816: no central bank
1816-1836: Second Bank of the United States
1837-1862: Free Bank Era
1863-1913: National Banks
1913-Present: Federal Reserve System
The main motivation for the third central banking system came from the Panic of 1907, which renewed demands for banking and currency reform. During the last quarter of the 19th century and the beginning of the 20th century the United States economy went through a series of financial panics. According to proponents of the Federal Reserve System and many economists, the previous national banking system had two main weaknesses: an “inelastic” currency; and a lack of liquidity. The following year Congress enacted the Aldrich-Vreeland Act which provided for an emergency currency and established the National Monetary Commission to study banking and currency reform. The American public believed that the Federal Reserve System would bring about financial stability, so that a panic like the one in 1907 could never happen again; but just 16 years later, in 1929, the stock market crashed again, and the United States entered the worst depression in its history, the Great Depression. Critics of the Federal Reserve System including Milton Friedman state that the Federal Reserve System helped to cause the Great Depression.
The Federal Reserve Act
Further information: Federal Reserve Act
Newspaper clipping, December 24, 1913
The chief of the bipartisan National Monetary Commission was financial expert and Senate Republican leader Nelson Aldrich. Aldrich set up two commissions — one to study the American monetary system in depth and the other, headed by Aldrich himself, to study the European central-banking systems and report on them. Aldrich went to Europe opposed to centralized banking, but after viewing Germany’s banking system came away believing that a centralized bank was better than the government-issued bond system that he had previously supported. Centralized banking was met with much opposition from politicians, who were suspicious of a central bank and who charged that Aldrich was biased due to his close ties to wealthy bankers such as J.P. Morgan and his daughter’s marriage to John D. Rockefeller, Jr.
Aldrich fought for a private bank with little government influence, but conceded that the government should be represented on the Board of Directors. Most Republicans favored the Aldrich Plan, but it lacked enough support in the bipartisan Congress to pass. Progressive Democrats instead favored a reserve system owned and operated by the government and out of control of the “money trust”, ending Wall Street’s control of American currency supply. Conservative Democrats fought for a privately owned, yet decentralized, reserve system, which would still be free of Wall Street’s control. The Federal Reserve Act passed Congress in late 1913 on a mostly partisan basis, with most Democrats in support and most Republicans against it. (bold emphasis mine)
Because of his impact on national politics and central position on the pivotal Senate Finance Committee, he was referred to by the press and public alike as the “General Manager of the Nation”, dominating all tariff and monetary policies in the first decade of the 20th century. In a career that spanned three decades, Aldrich helped to create an extensive system of tariffs that protected American factories and farms from foreign competition. He rebuilt the American financial system along Progressive lines through the institution of the federal income tax amendment and the Federal Reserve System. He did so in the belief that it would lead to greater efficiency. Aldrich became wealthy with investments in street railroads, sugar, rubber and banking. His son Richard Steere Aldrich became a U.S. Representative, and his daughter, Abby, married John D. Rockefeller, Jr., the only son of John D. Rockefeller. Her son, Nelson Aldrich Rockefeller, served as Vice President of the United States under Gerald Ford.
Abraham Piatt Andrew:
- • Assistant Secretary of the Treasury
- • Member of the “National Monetary Commission” (dates uncertain)
- • 1909 : Director of the U.S. Mint (1909-10)
Frank A. Vanderlip (1864 – June 30, 1937) was an American banker. From 1897-1901, Vanderlip was the Assistant Secretary of Treasury for President of the United States William McKinley’s second term, 1897-1901. In that office he negotiated with National City Bank a $200 million loan to the government to finance the Spanish American War. Thereafter he was vice president and then president of National City Bank (1909-19). In November, 1910, he was a member of the Jekyll Island group, a group of bankers that wrote the bill that became the Federal Reserve Act.
Henry Pomeroy Davison (June 12, 1867 in Troy, Pennsylvania – May 6, 1922 in Locust Valley, New York) was an American banker and philanthropist.
…Three years later he moved to New York City where he was employed by the Astor Place Bank, and sometime later became president of the Liberty National Bank. Several years later he was involved in the founding and formation of the Bankers Trust Company. In 1909 he became a senior partner at JP Morgan & Company, and in 1910 he was a participant in the secretive meeting on Jekyll Island, Georgia that may have led to the creation of the Federal Reserve and has generated much speculation over the years.
President of First National Bank of New York (J.P. Morgan Dominated)
Benjamin Strong, Jr. (December 22, 1872 – October, 16, 1928) was an American economist. He served as Governor of the Federal Reserve Bank of New York for 14 years until his death. Strong exerted great influence over the policy and actions of the entire Federal Reserve System.
Strong was also involved in the establishment of the Federal Reserve System. After the panics of the 1890s, leading bankers believed a private central bank should be created to issue money. The public was adamantly opposed to the establishment of a central bank. Strong, who was Vice President of Banker’s Trust of New York, was JP Morgan’s emissary to the secret Jekyll Island (Georgia) expedition in 1910—one of the selected members who stayed at the luxurious Jekyll Island Hunt Club retreat in November for a private ten-day conference. Also in attendance were Paul Warburg, a recent immigrant from a prominent German banking family who was a partner in the New York banking house of Kuhn, Loeb & Co.; Senator Nelson Aldrich (Nelson Rockefeller was named after Aldrich, his maternal grandfather); A. Piatt Andrew, Assistant Secretary of the Treasury and Special Assistant to the National Monetary Commission (the only other NMC member besides Aldrich); and other bankers including Frank Vanderlip, president of the National City Bank of New York; Henry P. Davison, senior partner of J.P. Morgan & Co.; and Charles D. Norton, president of the Morgan-dominated First National Bank of New York.
What came to be known as the Aldrich Plan was drafted by these men during their conference at Jekyll Island. The plan was written in secrecy, as the public would never approve of a banking reform bill written by bankers; much less of a plan for a central bank. The Aldrich Plan was introduced in the U.S. Congress, and followed by much debate, but never came to a vote, because the party in favor of it was voted out, and the Glass-Owens Bill was introduced instead.
The general outline of the Aldrich Plan did eventually serve as the model upon which the Federal Reserve System was created with, however, significant changes that placed control into political hands (via the Board of Governors, selected by the President of the United States), and limited the role of professional bankers in its operation to that of the 12 branches. It met with Warburg’s satisfaction, as he said that minor changes could be adjusted administratively later. The term Central Bank purposely was kept out of its name, as Warburg and others warned it would not be passed otherwise.
A bill creating the Federal Reserve System was approved by Congress three years later, after much heated debate, and signed into law on December 23, 1913 after initial hesitation on the part of President Woodrow Wilson, and after a conference between him and Bernard Baruch, one of his largest campaign donors. The Federal Reserve System is similar to the National Reserve Association proposed by The Aldrich Plan, but with vastly differing management and control.
Strong became President of Banker’s Trust in 1914, and shortly thereafter was appointed Governor of the Federal Reserve Bank of New York the same year, which position he maintained until his death in 1928.
Economic historian Charles P. Kindleberger states that Strong was one of the few American policymakers interested in the troubled financial affairs of Europe in the 1920s, and that had he not died in 1928, just a year before the Great Depression, he might have been able to maintain stability in the international financial system.
Paul Warburg: (Probably the most pivotal “Money Men” character to pay attention to)
Paul Moritz Warburg (August 10, 1868 — January 24, 1932) was a German-American banker and early advocate of the U.S Federal Reserve system.
Warburg was born in Hamburg, Germany, to a successful Jewish banking family. His parents were Moritz and Charlotte (Esther) Warburg. After graduating from the Realgymnasium in Hamburg in 1886 he entered the employ of Simon Hauer, a Hamburg importer and exporter, to learn the fundamentals of business practice. He similarly worked for Samuel Montague & Company, bankers, in London in 1889-90, the Banque Russe pour le Commerce Etranger in Paris in 1890-91.
In 1891 Warburg entered the office of the family banking firm of M.M. Warburg & Company, which had been founded in 1798 by his great-grandfather. He interrupted work there to undertake a world tour during the winter of 1891-92. Warburg was admitted to a partnership in the family firm in 1895.
On October 1, 1895, Warburg was married in New York City to Nina J. Loeb, daughter of Solomon Loeb, founder of the New York investment firm of Kuhn, Loeb & Company. The Warbugs were the parents of a son, James Paul Warburg, and a daughter, Dr. Bettina Warburg.
Although a major factor in German finance, after frequent business trips to New York Warburg settled there in 1902 as a partner in Kuhn, Loeb & Company where the influential Jacob Schiff, his wife’s brother-in-law, was senior partner. Warburg remained a partner in the family firm in Hamburg, but he became a naturalized American citizen in 1911. He was a member of Temple Emanu-El in New York City.
Warburg was elected a director of Wells Fargo & Company in February 1910. He resigned in September 1914 following his appointment to the Federal Reserve Board, and Jacob Schiff was elected to his seat on the Wells Fargo board.
Paul Warburg became known as a persuasive advocate of central banking in America, in 1907 publishing the pamphlets “Defects and Needs of Our Banking System” and “A Plan for A Modified Central Bank”. His efforts were successful in 1913 with the founding of the Federal Reserve System. He was appointed a member of the first Federal Reserve Board by President Woodrow Wilson, serving until 1918.
In 1919 he founded and became first chairman of the American Acceptance Council. He organized and became the first chairman of the International Acceptance Bank of New York in 1921. International Acceptance was acquired by the Bank of the Manhattan Company in 1929, with Warburg becoming chairman of the combined organization.
He became a director of the Council on Foreign Relations at its founding in 1921, remaining on the board until his death. From 1921 to 1926 Warburg was a member of the advisory council of Federal Reserve Board, serving as president of the advisory council in 1924-26. He was also a trustee of the Institute of Economics, founded in 1922; when it was merged into the Brookings Institution in 1927, he became a trustee of the latter, serving until his death.
So you see the connections from the past to the present through Aldrich, Rockefeller, Warburg, The Council On Foreign Relations and the Brookings Institute?
Picture a party of the nation’s greatest bankers stealing out of New York on a private railroad car under cover of darkness, stealthily riding hundred of miles South, embarking on a mysterious launch, sneaking onto an island deserted by all but a few servants, living there a full week under such rigid secrecy that the names of not one of them was once mentioned, lest the servants learn the identity and disclose to the world this strangest, most secret expedition in the history of American finance. I am not romancing; I am giving to the world, for the first time, the real story of how the famous Aldrich currency report, the foundation of our new currency system, was written… The utmost secrecy was enjoined upon all. The public must not glean a hint of what was to be done. Senator Aldrich notified each one to go quietly into a private car of which the railroad had received orders to draw up on an unfrequented platform. Off the party set. New York’s ubiquitous reporters had been foiled… Nelso (Aldrich) had confided to Henry, Frank, Paul and Piatt that he was to keep them locked up at Jekyll Island, out of the rest of the world, until they had evolved and compiled a scientific currency system for the United States, the real birth of the present Federal Reserve System, the plan done on Jekyll Island in the conference with Paul, Frank and Henry… Warburg is the link that binds the Aldrich system and the present system together. He more than any one man has made the system possible as a working reality. (Emphasis mine)
In the next article in the series, (if you can stand it), we will explore James P. Warburg, the Council On Foreign Relations, the Brookings Institute, Institute For Policy Studies, The United Nations, and whatever else rears it’s ugly head while I am researching.