In the early 20th century, the U.S. experienced a centralization of power that significantly reinterpreted the federal authority, replacing key elements of traditional American liberty. This change was precipitated by the 1910 Jekyll Island Conference, which led to the creation of the Federal Reserve Act in 1913 and thus, the establishment of the Federal Reserve, the U.S. Central Bank.
The Federal Reserve was entrusted with the dual mandate of maintaining low inflation and high employment. It wielded control over the money supply and the price of money via the federal funds rate. However, the Federal Reserve’s effectiveness was put to the test during the financial crisis of 1929, which snowballed into the Great Depression. Despite the Federal Reserve’s inability to prevent or mitigate the crisis, many economists and political leaders concluded that the state needed to exert more control over the American economy.
This shift towards authoritarianism in the U.S. echoed similar movements in other countries. For instance, when U.S. President Franklin Delano Roosevelt issued the Executive Order 6102 in 1933, mandating citizens to surrender their gold to the U.S. Treasury, he was following in the footsteps of other authoritarian leaders of the time, such as Winston Churchill, Joseph Stalin, Benito Mussolini, and Adolf Hitler.
Following the World Wars, the U.S. amassed the world’s largest gold stockpile as allied nations purchased American-made weapons with gold. At the post-war Bretton Woods Conference in New Hampshire, it was decided that the U.S. dollar would become the global reserve currency, redeemable for gold. It was also during this conference that the International Monetary Fund and World Bank were established.
Meanwhile, back in the U.S., a postwar military-industrial complex emerged, normalizing a wartime posture in peacetime and promoting arms dealing to boost GDP. The necessity to fund this led to the Nixon administration suspending the redeemability of dollars for gold in 1971. This was followed by an informal agreement with Saudi Arabia to denominate oil purchases in dollars and recycle those dollars back into the U.S. economy. This clandestine petrodollar agreement was made to bypass the need for congressional approval.
Currently, the petrodollar system is unraveling as major oil producers have begun pricing oil in other currencies. This is an expected international response to U.S. foreign policy since the end of the Cold War, which has insisted on unipolar American dominance in international trade and military operations. The 9/11 terrorist attacks provided a pretext for the U.S. to declare an open-ended war on terror, spending trillions on foreign wars and formally militarizing the U.S. homeland. This has led to the erosion of a citizen’s right to privacy in the name of counterterrorism.
The 1970s saw the U.S. banking system, centralized at the beginning of the century, becoming an extension of the state’s policing function. The revolving door between Wall Street, the Federal Reserve, and the Treasury facilitated collusion between those who make and enforce laws and those who control money. This has ensured the continued functioning of the machine built by the Banker Revolution and bolstered by the petrodollar system, largely benefiting the elites.
However, the 1970s also saw the introduction of legislation that was ostensibly aimed at limiting the power of unaccountable actors. The Bank Secrecy Act, the National Emergencies Act, and the Foreign Intelligence Surveillance Act were all intended to limit the power of banks, the presidency, and federal law enforcement and intelligence agencies, respectively. Ironically, these attempts resulted in the exact opposite of their intended effects, leading to a political culture in crisis.
The U.S. has since seen an erosion of individual rights, with citizens now presumed guilty before the law, and the state holding rights, money, and power, which it uses imperially and unaccountably. This significant shift in the political landscape marks a return to
