“God have mercy on the currency,” read the headline. Curious, I followed the link to an article about the president of Zambia calling for a national day of prayer and fasting to address country’s currency crisis. It turns out that Zambia’s national currency, the Kwacha, has fallen by 45% against the US dollar in 2015, causing Zambians a host of economic difficulty. It is eminently Christian and sensible to call on the Lord in times of trouble The Bible is filled with promises that God will deliver his people if they call upon his name. Typical is Ps. 50:15 which reads, “Call upon Me in the day of trouble; I will deliver you, and you shall glorify Me. And because it is eminently Christian and sensible to call on the Lord in times of trouble, no Western president or prime minister would ever think of doing it. “We’ve got this,” they say, “no divine help needed.”
Such was not always the case. During the American Civil War, Abraham Lincoln called for a national day of prayer and fasting. But that sort of thing doesn’t fly anymore. In the aftermath of the greatest national disaster of my lifetime – I’m speaking here about the 9/11/2001 terrorist attacks on New York and Washington D.C. – George Bush encouraged Americans to go to Disney World. What’s worse, he participated in a blasphemous ecumenical prayer service at the National Cathedral in Washington which featured, among others, a female Episcopal bishop, a Rabbi, a Muslim cleric and a Cardinal of the Roman Catholic Church-State. Far from being an example of turning to God, this service was a double-minded affront to the Lord Christ Jesus. And because it was double-minded, those who participated had no reason to think they would receive God’s blessing or assistance. The failure of the Global War on Terror stands as a stark testimony to this principle.
When Will They Ever Learn
“Why should you be stricken again? You will revolt more and more.”– Isaiah 1:5
It’s tempting to think that the obvious, repeated policy failures of Western governments and the disastrous consequences that have followed from them lead the people of the West to rethink what is being done in their name. But events do not change people minds. Not even those of the 9/11 variety. Only new ideas do that. But what if people refuse to listen to new ideas? What if, instead of admitting their failures and repenting of their sins, they insist on doubling down on the foolishness that caused them the problems in the first place? There is no hope for such a people. That, in effect, is what God said some 1,700 years ago to Judah through the prophet Isaiah. It was true then. And it is true now.
A recent article in the Guardian called to mind the seemingly hopeless condition of the Western world. In contrast to the president of Zambia who at least had the good sense to seek God’s guidance about his nation’s economic crisis, the author of an article in the Guardian titled “The world economic order is collapsing and this time there seems no way out,” while recognizing the serious plight of the world’s economy, attempts to convince us to enact on a global scale the same statist policies that already have failed on the national level. Never willing to admit their ideas don’t work, statists always blame whatever mess results of their inept solutions on the fact that they were not given enough money and/or authority to properly address the problem.
In the case of author Will Hutton, his call is for bigger and more powerful central banks to combat the collapse of emerging markets such as Zambia, whose collapse, oddly enough, is the result of prior interventions by central banks. In his piece, Hutton calls for,
- “a bigger, reinvigorated IMF”
- “proper surveillance of global finance”
- “massive stimuli” from western governments “centred on infrastructure spending”
- “new smart monetary policies that allow negative interest rates”
It may be that somewhere someone has managed in a single article to advance a quartet of ideas worse than these, but if so, this author hasn’t seen it. Basically, Hutton would have us believe that by inviting Big Bother to play central banker to the world, all our problems will magically disappear, leaving us with nothing but rainbows and unicorns. What could possibly go wrong?
Bailout Nation
If you read between the lines, Hutton’s piece serves as an indictment of central banks not a defense of them. But Hutton doesn’t seem to get it. Citing Andy Haldane, Bank of England chief economist, Hutton tells us that the current economic mess is a three-part crisis, the first of which began in 2007-08 as a result of “absurdly high inflows of globally generated credit that created false booms.” This is mostly true. But what Hutton doesn’t tell you is who it was, exactly, that produced the “absurdly high inflows of globally generated credit” that set the stage for the collapse of 2008 and the crisis that has continued since that time. Credit expansion is not a natural phenomenon like the sun rising in the east. The artificial and dangerous expansion of “globally generated credit” was the fault of, drum roll please…central banks and the central bankers who run them. In response to the collapse of the US equity markets in 2000 and the collapse of the US housing market in 2008, Alan Greenspan and later Ben Bernanke of the US Federal Reserve created trillions of dollars of credit out of thin air to reinflate financial bubbles that by every fair measure should have collapsed, all for the purpose of bailing out their banker buddies. “Too big to fail” was the fraudulent mantra of the central planners and fixers in 2008. No one is too big to fail. Certainly not the boys on Wall Street. Had they been allowed to go bankrupt, as should have been the case, we would already be on our way to a recovery. But seven years and trillions of newly printed dollars later, the US and world economies are still limping along, and now threaten to turn down once again.
Another disastrous facet of central bank credit creation is that it encourages overproduction. When interest rates are set artificially low, it encourages governments and businesses to undertake projects they otherwise would not. All that cheap, central bank created credit induced a sort of sugar high for the world’s economy. It stimulated massive overspending on big, capital projects that require commodities such as iron ore, copper and lumber. For those nations that produce these commodities, the boom was great while it lasted. But just as sugar highs inevitably wear off, so too do artificial central bank created booms. And now that the artificial boom has ended, crashing global commodity demand is taking down the economies of those nations that produce them such as Zambia. In other words, the reason Zambia’s Kwacha is tanking against the dollar is to a large extent the result of decisions made by a few central bankers meeting in secret behind closed doors at the Federal Reserve in Washington. Central banking is the problem, Mr. Hutton, not the solution.
One World Under Surveillance
But central banking is not only bad economic policy, it is also rather creepy. Not only does Hutton call for more central bank monetary stimulus, he wants it done on a global scale by “a bigger, reinvigorated IMF.” In other words, he’s calling for world money. If national central banks aren’t up to the task, Hutton reasons, it’s time to take the money printing to the next level. But if that weren’t bad enough, Hutton also calls for “proper surveillance of global finance.” I shudder to think what he means by this. Things are already so bad in the US that banks are required by law to file a Suspicious Activity Report (SAR) with the federal government if a customer has engaged in activity the bank deems suspicious. Withdrawing your own money from your own bank account is enough to trigger a SAR, but you’ll never know it when it happens. Not only do the banks not have to tell you they have filed a SAR, but they actually are prohibited by law from disclosing this. What we need, Hutton tells us, is more of the same. Only this time it won’t just be the feds on your case, it will be the IMF or some other unaccountable globalist entity.
When I read such things, I’m reminded of the passage in the Bible that reads, “He causes all, both small and great, rich and poor, free and slave, to receive a mark on their right hand or on their foreheads, and no one may buy or sell except one who has the mark of the name of the beast, or the number of his name. Here is wisdom. Let him who has understanding calculate the number of the beast, for it is the number of a man: His number is 666 ” (Revelation 13:16-18). The events prophesied here clearly are related to matters political and economic. Further, these events have not yet come to pass. In the past, political, religious and technological issues prevented them. But in today’s world, technology is certainly no barrier to a world currency or “proper surveillance of global finance.” Protestants, who for nearly 500 years provided effective opposition to the Roman Catholic Church-State’s drive for world dominance, have to a large extent unilaterally laid down their arms. But not only that. As can be seen from the hoopla over the pope’s recent visit to the US, Evangelicals are falling all over themselves to embrace the great papal Antichrist. So there’s not much religious opposition to world government any more. Politically, we’re only one terrifying economic crisis away from people calling for someone, anyone to rescue them. What is more, the Vatican is already involved with the IMF. It just may be that God is ripening the world for the global economic and political dystopia prophesied in the Scriptures.
Negative Interest Rate Farce
All this, and I haven’t even addressed Hutton’s fourth proposal, negative interest rates. Negative Interest Rate Policy or NIRP is a mutant Frankenstein monster sprung from the warped minds of central bankers. It is unnatural. It is almost comically absurd and about as far removed from Biblical capitalism as can be. It is also taken very seriously in the world of central bankers.
In capitalism, goods and services are sold via voluntary exchange at a price. This includes money. An interest rate is simply the price of money. If you need to borrow to buy a house or start a business, the interest rate is the price you pay to access the funds sooner than what you could otherwise. For money to be lent, it must first be saved. The saved funds are capital, and the interest rate is the reward a saver receives for lending out his capital.
In the minds of our central banking savants, savers have no right to receive any reward for their prudence and hard work. In fact, they should be severely punished for their steadfast refusal to go into debt. Not only is punishing savers with central bank imposed negative interest rates theft, for it denies them the ability to earn a fair market return on their money, it is a form of calling evil (debt) good and good (savings) evil.
But beyond that, NIRP is a form of consuming one’s seed corn. Capital, the amount saved over and above what an individual needs for survival, is the engine for economic growth. When central banks destroy the incentive for savings, they short-circuit the process of capital formation, which leads to less innovation and growth, which leads to the Will Huttons of the world calling for more central bank interventions, which leads to less capital formation which leads to…well you get the picture. And this vicious cycle is the product of what Hutton ironically calls a “new smart money policy.”
Comic Relief
Hutton does provide a bit of unintentional comic relief by his whining about the political right. After darkly warning about the need for a globally coordinated response to the world-wide economic downturn and the Syrian refugee crisis, Hutton lays blame for the lack of it on the all-powerful “libertarian, anti-state philosophies on the dominant Anglo-Saxon political right in the US and the UK.” Run for your lives! Ron Paul’s taking over the world! Would to God that it were so. Perhaps then the long-suffering lovers of liberty in the US and UK could actually do something effective about the growing economic oppression and police state dystopia enveloping their respective once free nations. As it is, the image of a right-wing libertarian juggernaut holding at bay the beneficent forces of world government remains a figment of Hutton’s perfervid imagination.
Conclusion
Hutton’s article is not without truth. Under the headline are the words, “The refugee crisis is paralleled by the savage fallout from a global financial system running out of control.” These two events, the flood of people fleeing the war in Syria and t he out of control financial system may seem unrelated, but they are two sides of the same coin. Unfortunately, Hutton does not seem to understand the connection. In short, it is this: the out of control financial system has made possible the Syrian war that is to blame the flood of refugees surging into Europe.
Have you ever asked yourself how it is that the US can intervene in country after country all over the world, add a national healthcare system on top of that, and yet the federal government never raises taxes? Where does the money come from? The short answer is, they create it out of thin air. This increase in the supply of money has the effect of destroying the value of the dollars you already own and transferring that value from you, the holder of dollars, to those who stand closest to the government’s monetary spigot and receive the newly created dollars first.
In the banking business, this is referred to as having an elastic currency. An elastic currency has this wonderful property – wonderful, that is, if you’re an unscrupulous politician – of allowing governments to spend money like there’s no tomorrow but never have to call for an unpopular tax increase. How great is that! Congress can have its financial cake on eat it too. This means, among other things, that politicians can push for unconstitutional, undeclared wars of aggression, all the while funding their violence with printed money. When prices rise as a result, almost no one makes the connection between the increasing price of food at the supermarket and the foreign entanglements of which Congress is so fond. To put it another way, if Congress actually had to raise taxes to fund the war to depose Bashar Al Assad as head of Syria, Americans would take to the streets in protest. As it is, no one seems to mind very much.
An elastic currency is nothing but a sophisticated form of theft. For money to be honest, it must maintain value over time. But in the 100 years that have passed since the founding of the Federal Reserve, the dollar has lost 98% of its original value. Our silver, in the words of the prophet Isaiah, has become dross. This is not an accident. This is not an oversight. It is the result of a deliberate policy on the part of the political and financial elite to enrich themselves at the expense of others. It enables socialists to clamor for new bureaucracies and hide the cost from their constituents. It enables war mongers and new world order types to overthrow governments and occupy whole nations while posturing as benefactors brining democracy to the benighted masses of the third world. An elastic currency is the modern equivalent of a false balance and dishonest scales. And these God calls an abomination.
May God have mercy on the people of the West. The world economic order is indeed collapsing. Yet contra Will Hutton, there is a way out. But the road to recovery doesn’t run through the globalist central-bank-dominated dystopia he imagines. The hope for recovery, the only hope for recovery is found in the economic and political system found in the Word of God. It’s called capitalism. It’s called sound money. It’s called freedom.
Lux Lucet 
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