Wealth

posted Jun 18, 2012, 7:17 PM by Hector Falcon   [ updated Dec 27, 2012, 10:54 AM ]

Our government leaders have embarked on a policy which bases our money on the relative value of paper money. The problem with this type of economic system is that it can be manipulated by our government to create money out of nothing. In fact, that is what they have been doing for quite some time. They have artificially created money by just printing more of it whenever they need it to finance the government budget. The end result is that the money loses its values through inflation. This goes against the principles of sound money that God established within the Bible. When we fail to follow the principles he has established, we will ultimately pay the price. In our case, we have robbed the future of our children by allowing the politicians to print fiat money and to run up the national debt. Many of economists have followed the logic of Keynes which says that the way out of debt and a poor economy is to spend more. The following article by R.J. Rushdoony presents the dilemma of paper money and Gary North addresses the contribution of Keynes on our economy.

Why Paper Money Represents Theft       

Every hour of every day the government is stealing your wealth, and, like a good thief, is never suspected. It does it by creating paper (or digital) money and spending it, just like a counterfeiter.

Scripture demands just weights and measures (Lev.19:35–36; Deut. 25:13–15). Obviously, a butcher who holds his finger on the scale when he weighs meat violates this requirement. However, this demand is also a reference to money, which was then also by weight of gold and silver and was counterfeited by adding impurities to it so that its weight was unjust. Tampering with scales or the money that measured wealth in economic transactions was called “unrighteousness” (Lev.19:35) because it was theft. Isaiah condemned Jerusalem for its sin. It had become a city of murderers, thieves, and bribe-takers, and , as Isaiah said, their “silver is become dross, thy wine mixed with water” (Isa. 1:22). In other words, Jerusalem was a place where you were going to get clipped.

Melting worthless metals into precious ones, however, is cumbersome. Today’s unjust monetary weights are represented by paper money issued by the government. Increasingly, paper is eliminated and money is created digitally in a computer. Click, and dollars appear because the Federal Reserve System so commands. The government spends these artificial dollars at full value; it is only after they circulate that the increased circulation causes market forces to realize there is more money chasing the same amount of goods. The result is higher prices, reflecting the fact that all money is now worth a little less. Paper inflation is like adding water to wine; the wine becomes less valuable, not more.

Paper money works in the same manner as counterfeiting; only governments allow themselves the exclusive right to inflate the money supply. It still represents a morally lawless money because it is an artificial money, an unjust, unrighteous weight (really no weight at all). Inflation is the government creating spending power by “watering down” the money supply.

Paper money is the greatest single means of government control of wealth. We measure our economy, in fact, in terms of the government’s success in manipulating the flow of money. We watch the Federal Reserve to see if they can maintain a balance between recession and inflation. The health of our economy is increasingly measured in terms of government management, not in terms of productivity, savings, or capital. In reality, an economy that demands government management is already a troubled one.

Critics of hard (gold, silver) money note these are commodities that can fluctuate in value. They can vary in an open market, but paper money always varies and does so in a consistently downward trend. Money represents wealth, and government-inflated paper dollars are a manipulated sliding scale of wealth. How much has our scale slid? It is estimated that if you had held on to a 1934 paper dollar, its spending power today would be the equivalent of five 1934 cents!

We usually realize the tenuous nature of our money’s value. We scramble to avoid holding paper. We put paper money into tangibles we hope will increase in real value faster than paper dollars will decline. Antiques, art, real estate, and stocks all offer us some hope of outpacing the decline in value of our paper money.

Inflation destroys money, the measure of wealth, and is a poison for a capitalistic economy. Inflation means there is no security to acquired wealth, that we must do more than invest, we must speculate on what will outpace inflation.

Our money represents a counterfeiting government’s theft of our wealth. It is an unjust, that is, an unrighteous, weight that produces an artificial economic atmosphere. Like Jerusalem in Isaiah’s day, our counterfeiting government is ripe for judgment. Because it is unjust, the godly ought not to justify it.

Most of God’s judgments are the inevitable consequences of ignoring His laws. If you jump off a cliff, God does not have to do anything to judge you; His gravity will do the job. In our personal finances, we know that theft and debt will lead to our ruin. Our economy is based on the theft of false measurements and debt. One day it will see a severe correction. It will be a hard one, and the hurt will be universal. Avoid both debt and depending on the value of paper money to protect your wealth, however, and you will come out of it better than most.

Rev. Mark R. Rushdoony is president of Chalcedon and Ross House Books. He is also editor-in-chief of Faith for All of Life  and Chalcedon’s other publications.


Gary North on Keynes


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