Dictatorship is unlimited rule. Collective dictatorship is unlimited rule by an assembly. National government in the U.S. has tended toward collective dictatorship over its entire history.
No new alarm bell is rung when I say that the U.S. collective dictatorship is now enlarging, for that is its usual tendency. We recognize this tendency at the grass-roots level by the increasing control that government has over our personal lives. There is almost nothing that we do that is not touched by government rules and power. We cannot work, play, invest, obtain medical care, drive a car, eat, smoke, speak, gesture, wash, have a baby, buy or sell a good, or even have a bowel movement without encountering the government.
Yet the alarm bell needs now more than ever to be rung loudly and vigorously, for the most recent enlargement is coming in the area of financial control over the banking system and thus the economy. What is left of liberty in America faces an extremely dangerous threat. It is all the more serious because it is not widely recognized as a threat.
To understand what is happening now in the U.S., it is useful to compare the parallel developments that occurred in Nazi Germany. The German central bank, the Reichsbank, was far more restricted by law (before 1939) than our central bank, the Federal Reserve (Fed) in the kinds and amounts of loans it could make. The Fed, in this sense, is far more powerful than the Reichsbank was before 1939. The Reichsbank was, like the Fed, independent of the government. The German government could not order it to make loans to the government, for example. This situation changed in 1939 when the Nazi government needed more funds to finance its armament build-up. At that point, the government basically absorbed the Reichsbank.
It helps to read the words of Hjalmar Schacht, who headed the Reichsbank between 1933 and the time of his dismissal in early 1939. Schacht is something of a controversial figure in history. In 1946 he was tried as a war criminal at Nuremberg where he testified. Dr. Schacht, who was acquitted, had ended up in a concentration camp. An extended discussion of Schacht's activities that brings out the negatives is contained here. A less critical account is here.
Here is some of what Schacht testified that is germane today:
"Consequently, when it became clear that Hitler was working toward a further increase in rearmament – and I spoke about that yesterday in connection with the conversation of the 2nd of January, 1939 – when we became aware of that, we wrote the memorandum which has been quoted here and is in the hands of this Tribunal as an exhibit. It indicates clearly that we opposed every further increase of State expenditure and would not assume responsibility for it. From that, Hitler gathered that he would in no event be able to use the Reichsbank with its present directorate and president for any future financial purposes. Therefore, there remained only one alternative; to change the directorate, because without the Reichsbank he could not go on. And he had to take a second step; he had to change the Reichsbank Law. That is to say, an end had to be put to the independence of the Reichsbank from governmental decrees. At first he did that in a secret law – we had such things – of 19th or 20th January, 1939. That law was published only about six months later. That law abolished the independence of the Reichsbank, and the president of the Reichsbank became a mere bank teller for the credit demands of the Reich or, that is to say, of Hitler."
Schacht makes crystal clear that the central bank was essential for the government to be able to arm the country and make war. Without the bank, Hitler "could not go on." He would not be able to use the bank "for any future financial purpose" such as paying for armaments. Furthermore, if the bank would not cooperate, then "an end had to be put to the independence of the Reichsbank from governmental decrees." That having been done by Hitler, the president of the bank "became a mere bank teller for the credit demands of the Reich or, that is to say, of Hitler."
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