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Talk:Early American currency/Archive 1

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Latest comment: 14 years ago by KHirsch in topic When Franklin was examined

Colonial Script was money that was not backed by gold and silver. In the 18th Century if you issued money it would decrease the Purchasing Power of it, if you issued 10 dollars it would decrease the value of all your money(Purchasing Power). The Colonies economy prospered because they were not being oppressed by the bank of England yet. The Bank of England had the rest of the world by the balls because they controlled the british government through the debt and Gold standard system.

I don't believe that the word is "script" it is "scrip" --Unattributed
Your conclusion about debased money and inflation is incorrect in that it assumes that were the Congress to issue more debased currency, the legal requirement on the banks to keep the same amount in reserves would continue unchanged. This is hardly the case as were the Congress to actually issue its own money instead of letting the Federal Reserve--a privately own bank with no Congressional oversight--print it, they would most assuredly increase the amount banks must hold in reserve in order for the currency to maintain its value. Foofighter20x 04:48, 2 April 2007 (UTC)

Discussion moved from article text

Sean Gabb writes: At least the majority of these alleged quotes are fake. No one in the 18th or 19th centuries would have written this sort of English. "Manipulators", "Prime Cause", "inflation", "Deflation", "Corportations" - these are words either unknown at the time or unused to carry the meanings here given them. There is also the matter of grammar and prose rhythm. These quotes are all fabrications by various monetary dissidents of the middle to late 20th century.

I suggest this whole entry should be removed.

    • The proof lies in the pudding. They may not have been the exact words of the men quoted, but they do accurately reflect their views. The words have merely been adjusted so we can understand what they are saying in modern economic terms. Franklin did indeed go to London in 1764 to argue on the Colonies behalf to get their money back. His views on the currency are accurately quoted. The same goes for Jefferson.

Fraudulent quotes

Latest comment: 15 years ago2 comments2 people in discussion

I removed these quotes from the article, since evidently no one believes that they are accurate.

"We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers. In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay no one" -Benjamin Franklin This is from a 1941 radio address by Congressman Charles G. Binderup of Nebraska"America Created it's Own Money"
After the Revolutionary War had started, Benjamin Franklin believed it was the act of abolishing Colonial Scrip that was a heavy contributor to revolution. "The Colonies would gladly have borne the little tax on tea and other matters had it not been the poverty caused by the bad influence of the English bankers on the Parliament, which has caused in the Colonies hatred of England and the Revolutionary War." - Benjamin Franklin (Also from the Binderup address)
The refusal of King George to operate an HONEST colonial MONEY SYSTEM which freed the ordinary man from the clutches of the manipulators was probably the prime cause of the Revolution. (Thomas Jefferson)
Thomas Jefferson prophesized what would happen to America if it ever lost the inalienable right to issue its own money.
"If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them, will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered." (Thomas Jefferson)

Eliot 16:28, 28 March 2007 (UTC)

Each of these quotes is probably fraudulently derived from two quotes I memorized from a 1975 presentation in Alaska. The purposed distortions are probably derived from instances I made available in 1979 publication of two theses: 1) that any purported economy subject to interest ultimately terminates itself under insoluble debt, and 2) of a singular integral solution to a) inflation and deflation, b) systemic manipulation of the cost or value of money or property, and c) inherent multiplication of debt by interest. The latter solution later became known as mathematically perfected economy™.

Although the person who gave this presentation, a Canadian, Jacques Walker, was well documented, I knew him only 2 weeks, lost contact since, and never acquired his references. Nonetheless, this would be the verbal source, and the two quotes would be:

1. If the American people ever allow banks to issue their currency, first by inflation and then by deflation [by having to maintain a vital circulation by perpetually re-borrowing principal and interest as subsequent sums of debt, increased perpetually so much as periodic interest], the banks and [bank owned] corporations which will grow up around them will deprive the people of all property, until their children wake homeless on the continent their fathers conquered. (Jefferson)

2. We would have gladly borne the little tax on tea and other matters, had it not been that they took from us our money, which created great unemployment and dissatisfaction. Within a year, the poor houses were filled. The hungry and homeless walked the streets everywhere. (Franklin)

From the pattern of related work, I deduce that people are purposely obfuscating the source material to avoid attributing their work to mine, and to claim at least to some degree, authorship of a veritable thesis of inevitable economic collapse. Jaikaran for instance obfuscates my 1979 Parable of Perfect Economy in the first page of his 1994 (?) book, "Debt Virus," plagiarizing my work to claim and errantly state my 1979 thesis of inherent multiplication of debt by interest. He tells the parable yet as if it is a wholly true story (I make Franklin quite a bit more incisive than in the true version), and has Franklin explaining to the English that *the colonists* call the form of colonial money I cite (and modify) "Colonial Scrip." Well, this is not only an obvious, fraudulent fabrication (which is why I call the story, "Parable of..."), Jaikaran makes further ridiculous claims and purported citations of history to back them up. Obviously paraphrasing my 1979 Parable of Perfect Economy, Chapter 1 of Jaikaran's Debt Virus begins... "Two years earlier, this thoughtful gentleman had visited England. When asked why trade in the American colonies was prospering, Ben Franklin had replied, 'Our prosperity is simple, we issue our own money. It is called 'Colonial Scrip,' and it facilitates the exchange of goods."

Jaikaran should have paid attention to the title of the source material from which he stole. Unable to produce the source for my story (because the original presentation was verbal, etc.), I purposely made it a parable, and, to explain the gist of the underlying theory, I took license to speak my own thoughts through the character of Franklin. If Franklin had understood how to perfect economy, that solution would have comprised the Pennsylvania Scrip, which obviously differs from the Parable.

But as to the two quotes I have provided here, to the best of my recollection, these replicate the presentation of Mr. Walker verbatim.

To the early 90s, mine was the only such material on the web, as the context of that material was to support, evaluate and prove the thesis of mathematically perfected economy™, and thereby to prove the faults of the so called Federal Reserve System were purposed. So many people have borrowed liberally from my work since then, often proposing alternate purported solutions with flaws I have since invalidated (see our pages). They borrowed my background material to support their thesis, never citing my work as a source, and too deducing a false solution. I believe the quotes you have rightly deleted are products of imitation, purposely obfuscated to avoid exceedingly obvious plagiarism.

mike montagne (talk) 23:55, 2 August 2008 (UTC)

Can someone move this page?

Latest comment: 14 years ago2 comments2 people in discussion

It's supposed to be Colonial script. Thanks in advance. —Preceding unsigned comment added by 99.18.38.34 (talk) 01:37, 8 October 2009 (UTC)

No, the correct word is "scrip"

KHirsch (talk) 19:34, 9 October 2009 (UTC)

This is baffling.

Latest comment: 14 years ago1 comment1 person in discussion

Why is it that when I put Colonial Scrip into a search engine the first page is only results from either this page on Wikipedia or pages on Federal Reserve conspiracy theories? This article needs to be revised and looked over immediately by people who can actually provide sources for these claims. Right now this article is almost verbatim from the movie "Zeitgeist" which is vile and terrible for an article that claims some sort of authority and factual grounding.

Yes, this article is very inaccurate. I was planning to do a complete rewrite, but I don't really have the time. Much of it is based on a hoax propagated by Charles Binderup. All the quotes and about 75% of the history in that story are wrong. Some parts of it are true, though.
The different colonies used different forms of money, much of it paper money. Some of the money was just fiat money, others were backed by various commodities. The fiat money often caused inflation. After a bad experience in Massachusetts, restrictions were put on paper money in the New England colonies by the Currency Act of 1751. This didn't ban all paper money, but it did prevent it from being legal tender and from being used for paying taxes (maybe other restrictions, I need to do a little more research).
These restrictions were extended to the other colonies by the Currency Act of 1764. This might have happened earlier except for the necessities of paying for the French and Indian War.
The reason for the law was complaints from merchants, not because of bankers, and not because of anything Franklin said. Benjamin Franklin tried to get the law repealed, but he didn't testify about it until after it was passed.
It is not true that Benjamin Franklin—or any other founder, as far as I can tell—thought that the true cause of the American Revolution was paper money. The issue faded away gradually after 1765. And there was some loosening of restrictions in 1773. This essentially repealed the Currency Act of 1764, but not that of 1751. I need to do more research to figure out if this is just a geographic difference or there's more to it.
Sources:
  • The best reference to read is Ernst, Joseph Albert (1973). Money and politics in America, 1755-1775; a study in the Currency act of 1764 and the political economy of revolution. ISBN 080781217X. OCLC 622650. If you have access to JSTOR, there are articles by Ernst that are early forms of these chapters.
  • Brock, Leslie V. (1975). The currency of the American colonies, 1700-1764: a study in colonial finance and imperial relations. ISBN 0405072570. OCLC 1678302. Very dense, Brock's unedited dissertation.

KHirsch (talk) 21:21, 30 October 2009 (UTC)

When Franklin was examined

Latest comment: 14 years ago1 comment1 person in discussion

I'm removing this paragraph because it is highly inaccurate:

When Franklin was examined before a Committee of the whole House of Commons in 1776, he stated, "In an evil hour, the British Government took away from America its 'representative money'; commanded that no more paper 'bills of credit should be issued, that they should cease to be a legal tender,' and collected the taxes in hard silver. This was in 1773. Now mark the consequences. This contraction of the circulating medium paralyzed all the industrial energies of the people. Ruin seized upon these once florishing Colonies; the most severe distress was brought home to every interest and every family; discontent was urged on to desperation; till at last 'human nature' as Dr. Johnson phrases it, 'arose and asserted its rights.' In 1775 the American Congress first met in Philadelphia. In 1776, America became an Independent State." Page 63, Paper Money by James Harvey, 1877. Harvey states in a footnote, page 63, "This, the real cause of the disaffection of the American Colonies, is passed over by most historians."

First, Franklin was examined in 1766, not 1776. Second, the quote starting “In an evil hour...” is not from Franklin, but from the author of How Can Paper Money Increase the Wealth of a Nation? It's an easy mistake to make because of the extra quotations in Harvey's book, but there's an image of the original pamphlet here. You can also read Franklin's entire testimony here. Third, the currency ban was from 1763-4, not 1773. Fourth, I haven't been able to find a single neutral historian—as opposed to currency reform activist—who thinks that the ban on paper money was "the real cause of the disaffection of the American Colonies". It was one source of conflict, but not the primary one, and it had died down in importance by 1775.

KHirsch (talk) 18:56, 27 December 2009 (UTC)


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