14th Century Economics Lesson
[An oldie but goodie which can serve as a basic primer on how the modern economy actually works.. - HAC]
A long time supporter recently asked me to clarify a couple of points in the Party Program, specifically the prohibition against usury. “Are you going to confiscate all individuals’ life savings because they have earned interest?” The short answer, of course, is no, but it did remind me that we need to pay at least some attention to economics from an NS point of view. The nature of usury is a good place to start.
Before we can understand the National Socialist solution for the economic woes of capitalist society, we must first understand the way our present form of usury-generated finance capitalism arose in the Middle Ages and early Renaissance period. Not for nothing is economics called the dismal science; it is not only a complex subject but usually pretty boring. Please bear with me; I’ll try to keep this as simple and interesting as I can. I’m reading a book on Renaissance Italy at the moment, and it’s inspired me to use a concrete example from the past to show how our present economic order developed. All this is going to be very greatly oversimplified, of course, but I hope it will help you understand one of the many long paths our people have taken to arrive at our present mess.
First off, you need to understand that although Karl Marx was full of sheep dip, he did recognize and articulate certain correct and vitally important things about the nature of capitalism. Capitalism is utterly dependent on the exploitation of human beings for their labor, and in order to function capitalism must reinvent Man as a commodity, an economic unit of production and consumption. This dehumanizing concept has proven one of the most destructive aspects of the Jewish incursion into Western civilization.
Secondly, capitalism is dependent for the generation of capital not only on profit, but on the highly cost effective form of profit known as usury, the collection of interest on loaned money. Long recognized as the ultimate tool of Jewish power, usury was forbidden for centuries to Christians (which used to be pretty much the same thing as saying Aryans) by the Church. Only Jews were allowed to practice it, and any Aryan found charging interest was subject to a variety of penalties ranging from fines to the public removal of bits and pieces of the offender’s anatomy.
Modern day banks would have you believe that the economy is entirely dependent on the charging of interest, but that’s BS. The generation of non-production related profit through interest is actually a fairly recent development in man’s economic history. So how did the economy work in the days before usury? A good case study would be the rise and fall of the great Lombard banking houses of Italy during the Middle Ages.
Okay: let’s say we’re in Venice, a great trading city, about the year 1396. Usury is forbidden to everyone except the Jews, and their interest rates are as high as 50%, so nobody but a drunk or a madman deals with them anyway. The Jewish moneylenders exist on interest mostly off the very poor, as pawnbrokers, and the Church has even established a series of interest-free co-op religious pawn shops to try and protect the poor from the bloodsuckers. But if you’re a merchant you still have to finance your ventures, so how do you do it?
Let’s say you want to send a ship to Constantinople full of Italian goodies, cloth, worked metal goods such as cutlery and tools, glassware, wool, wine, so forth and so on. Then you want to bring back the same ship to Venice, full of Oriental goodies like spices, mahogany, Turkish rugs, etc. We will assign an arbitrary cost to this venture of 10,000 gold florins. You believe, and you can back it up to potential partners, that the profit from the sale of your goods in Constantinople and the resale of their goods in Venice will yield 20,000 florins, which for the sake of argument we’ll accept as accurate.
Where do you get the money? You can put up the entire ten grand yourself if you’re filthy rich, and many of the wealthiest merchant adventurers do, as well as putting up their lives, for many of these guys are not just businessmen, they’re sea captains and explorers and occasional pirates, and often they command their own vessels. They can opt to take all the risk, including the risk of the ship sinking or getting captured by pirates, and take all the profit. Or they can look for investors to share the risk.
Since our hypothetical merchant is a good Christian who doesn’t want to deal with hebes and a good businessman who doesn’t want to pay half his profit to (literally) a Shylock, he goes to one or more of the great Lombard banking houses, the Bardi, the Pazzi, the Strozzi, the Albizzi, or the up-and-coming Medici. These banks are centered mostly in Florence or Siena, but they have branches all over Europe in a day when the first Rothschilds are still haggling with peasants over the pawn of their wooden shoes for a few pfennig. Our merchant adventurer goes to the banks, most likely several of them because they will be more likely to back him if their individual exposure is less. He explains his venture, shows them the ship so they know it’s a stout seaworthy vessel, lets them know he’ll be captaining the voyage himself, and points out that he’s got a good track record of a dozen prosperous expeditions prior to this. He looks good to the Lombards, and so they lend him the dough. The total outlay for this project is ten grand in gold florins. The merchant himself will put up 4,000 florins, or 40%. The Bardi, the Strozzi, and the Medici banks will put up 2,000 each. They know they will have to wait one year for the ship’s return to find out how they did. This is the origin of the old expression “when my ship comes in.”
If everything goes according to plan, the venture will bring in 20,000 gold florins, thus recouping everyone’s initial investment and leaving ten grand profit. The merchant will take four grand of the surplus and the three banks two grand each, a 100% return on their investment. Good business—and something comes of it when those who can afford it get a nice Persian rug or some pepper to put on Aunt Maria’s lasagna, which in the days before refrigeration disguises the taste of the half-putrefied sausage she uses in her recipe.
Of course it was all a lot more complicated than that. For instance, in many cases the ship’s captain, if he was not the owner, would have a substantial share and the crew would be paid not only a minimum wage but a small share each as well, plus there was taxes and overhead just like today —but you get the idea. A rich merchant might send out ten ships a year under this system; three vessels are lost, but seven of them return fully laden with consumer goods and raw materials, leaving an overall profit and Venetian society wealthier thereby.
Do you note the difference between this system and Jewish usury? The Lombard banking system was based on productivity for profit, whereas the Jewish usury system is a shell game where money multiplies by itself without relation to anything in the real world. Under the Aryan system money was to be earned by buying actual things of value low and selling high, by making something, or building something, or undertaking risks to obtain something material and tangible.
In this example the objective was the importation of X amount of real consumer goods, not the manipulation of numbers on a piece of paper as in, say, today’s Stock Exchange or commodities market where there is only the most tenuous connection, if any, between the arbitrary value of the paper and any real or valuable object or commodity. If the voyage didn’t succeed, the investors were out their money, and this risk element led to a high degree of caution, canniness, and ability to assess risk as well as encouraged daring and enterprise for higher profits. The merchant princes of Renaissance Italy may have had a taste for luxurious living, intrigue, and poisoning one another, but they never threw money away like present-day governments and multinationals. They had worked and sweated and bled and killed to get it.
Another variation on this system was public works, for example the bridges over the river Arno in Florence, many of which were built by the bankers who were then allowed to collect tolls until they had recovered the expense of construction and a set profit—after which the bridges became free. There are endless variations: money was lent for agriculture, to build a factory or a workshop, to build a road, whatever, but always something you could touch, feel, taste, use or consume. Money did not magically produce money out of nothing as it does with usury.
So when did usury get its first foothold in the Western economy? Basically, when the Aryan ruling élite of that time, like their counterparts of the twentieth century, lost sight of their principles in the scramble for wealth and started acting like Jews. Unfortunately, the first big capitalist usurers in modern history were these same Lombard bankers in their later stages; the Jews then slid in on the coattails of the true claim that “everybody is doing it,” and within a short time they were running the whole game.
From the point of view of the lender, usury has one advantage over the productivity or venture-based system: it eliminates risk, for the lender, anyway. But it increases risk manyfold for the borrower, who not only puts his business and his own capital on the line but sometimes everything he possesses.
The borrower signs a bond or contract borrowing ten thousand florins and promising to pay back fifteen come what may, and as collateral he gives the lender the right to seize certain property if he is unable to pay by the stated date. The Lombard banking system was essentially a tool for the production of new wealth, while usury is a system for transferring existing wealth into a smaller number of hands, usually Jewish.
Essentially two things happened. First, a lot of the Lombard banks crashed down through the years when they inevitably made too many bad decisions, creating fewer and bigger banks handling more money led by more unscrupulous men as the Renaissance advanced. (Late Renaissance bankers and financial tycoons were often converted Jews, many of whom continued to practice Judaism in secret and openly favored their own people at the expense of their host nations.) Additionally, the Church became corrupt and quit enforcing the anti-usury statutes, and the secular princes and dukes and whatnot got into debt to the banks and overlooked the fact that they had begun to charge interest just like the Jews. Usury crept into our economy in stages, and it was still frowned upon even as late as the nineteenth century. (A character in a Sherlock Holmes story, for example, a ruined gambling nobleman who has mortgaged everything he owns and is about to lose it all, is referred to as being “in the hands of the Jews” by author Arthur Conan Doyle, an expression one could still get away with using as late as the 1890s.) Now, of course, we’ve got credit cards operating out of states like South Dakota with no banking laws to speak of who charge 29% revolving interest. It’s actually cheaper to borrow money from the Mob, organized crime’s traditional “vigorish” or interest rate being six for five or about 18%.
Another question I have been asked is about an article wherein I advocated a return to the gold standard. As most topics dealing with money seem to do, this also gets into the Jewish situation. Plus d’argent, voici les Juifs, as the French say.
Money was first invented as a substitute for barter, and for millennia consisted only of gold, silver, and occasionally copper or bronze coinage. Eventually as commerce expanded, it became too cumbersome and dangerous to go on a trading expedition lugging long mule trains loaded with gold coin, so with the establishment of the first medieval banks the paper bank draft was invented, allowing a merchant in London to travel to Paris carrying only a document instead of heavy bags of money so tempting to bandits, do his business, deposit his profits in the Paris branch of the Bardi or whoever, and then draw them out again from the London branch when he got home. This was the first paper money, and it was specific, like a check made out to only one person.
Eventually the Lombard and later Jewish banks began to issue what today we would call negotiable securities or debentures—bank drafts for X amount of money with no name on them, which could be used as legal tender to buy, sell, pay, and lend. The practice of individual banks issuing their own paper money continued up until the beginning of the 20th century; you can see all kinds of examples in museums.
In the flourishing and expanding economy of a dynamic young America, private banks, states, cities, even railroads issued their own paper money. But these paper notes or bills were always gold or sometimes silver certificates—that is, if you had a ten dollar bill from the First National Bank of Philadelphia and you took it in to that bank, you had the right to get a ten dollar gold piece for it. Paper money was originally intended as a convenience, not as a substitute for precious metals.
Redeemability in gold or silver had one big advantage: it kept the money supply under control and pretty much eliminated the curse of inflation and insane interest rates. Almost all the inflationary spirals in the past, aside from the odd catastrophe like the Black Death, have had to do with the uncontrolled issue of paper money, i.e. the Continental Congress period (my grandfather still used the expression “not worth a Continental”); Confederate money; the Weimar period in Germany, etc.
In 1913, this country did something so stupid that it defies rational analysis even today. We handed control of our money to the Jews in the form of a private corporation, the Federal Reserve, every head and important official of which from 1913 to this day has been Jewish. There is no such thing as U.S. currency, only Federal Reserve currency which is by law the only authorized form of legal tender. It took the Jews twenty years to take us off the gold standard and free themselves of the obligation to back up their green paper with gold or silver, but they managed it, and from 1934 onward the Jews have literally had a license to print money hand over fist.
The more paper money there is in circulation, the higher interest rates are charged (and the more impossible it becomes for young White married people to buy a home.) It’s all very complicated and I don’t understand all the ins and outs of it myself, but basically the cause of the inflation and the insanely high cost of everything today is due to the Federal Reserve system using our money as a means to enrich world Jewry and loot the Goldeneh Medina -- in Yiddish The Golden Honeycomb, their word for America.
I have in the past advocated a return to the gold standard as a temporary measure to get the money supply under control, reverse the wage-price spiral and get the cost of living under control, and to see if we can’t slash the incredibly inflated cost of real property to the point where young couples can actually buy a home large enough to raise children in, not some crackerbox condo or renting until they’re forty. What I would eventually like to see...
Ah, well, that’s for another time.
Harold A. Covington