Is it historically accurate that monetary policy was central to American Revolution?

I am wondering if the following article is basically accurate or largely inaccurate historically?


http://rense.com/general66/nobeyb.htm

 

mostly nonsense, with a kernal of truth. Most colonists in the British colonies were basically subsistence farmers who in the north owned their own land. In the south, you had more of a class divide, with wealthy land owners operating large tracts of land with slave labor, and small farmers on either their own land or working as share croppers. There was also a small group of tradesman and shop keepers. Overall there was a general labor shortage, since land was so plentiful, shops, ships, and small manufacturer's had to pay decent wages to keep employees, but it was easy for those employees to save up enough to buy land which was generally, dirt cheap. England, on the other hand was shifting from an agricultural society to an urban society, it was after all the early days of the industrial revolution. About the only standard currency in the colonies was either British or Spanish and for the most part it was gold and silver. coinage. some colonial banks issued currency, but there was no standard. A lot of trade in the colonies was done as barter. The primary economic system of the Brits was Mercantilism which was designed to make sure that Great Britain retained control of manufacturing and trade and the colonies were sources for raw materials. That's not really monetary policy, but trade policy.

It's also important to note that the reason the Brits wanted to tax the colonies, was that the 7 Years War between France and England had spilled over into North America where it was known as the French and Indian War, and the Brits had picked up the tab for defending the colonies from France. The British Parliament felt, with some justification, that the colonists ought to be responsible, at least financially, for some of that cost.

Economic theory and practice during that period wasn't sophisticated enough to really separate out monetary policy from the rest of it. The first really coherent study of economic theory didn't get published until 1776 when Adam Smith's Wealth of Nations appeared.

 

From a pure historical perspective there is something to criticize in this theory:

first of all in the early history of the colonies they used foreign money [for example Spanish dollar], they didn't issue paper money yet.
Second, and not less important, once the colonies begun to think to leave UK, they reached a rule which prohibited to single states to issue their own paper money [so that the young US begun for the single states what the British Empire was for the American colonies!!!].

Further more, in the early history of the colonies they used commodity money, instead of paper money and so there was no need for such a monetary conflict [tobacco is tobacco, it doesn't need the face of the queen on a banknote to value ...].

P.S. for once on WIKI you can find a good article about this: http://en.wikipedia.org/wiki/Early_American_currency

 

Curmudgeon…… I honestly consider that your reply is extremely well informed but I must take exception with the phrase "with a kernel of truth."

AlpinLuke just gave an excellent link on this topic which does tend to verify some of the important statements in the original article:

http://en.wikipedia.org/wiki/Early_American_currency

If "Colonial governments sometimes issued paper money to facilitate economic activity" then this would tend to correspond with the assertion by Congressman Charles Binderup that Colonial Scrip was decreasing unemployment.

The fact that "The British Parliament passed Currency Acts in 1751" corresponds very well with the assertion that in 1750 New England might have been doing something that would inspire The British Parliament to pass the first of three Currency Acts!

 

AlpinLuke the article that you give the link to is extremely helpful.

This is helping to fill in pieces of the puzzle that I have been wrestling with for two decades.

I am even concerned that we Canadians were in a sense on the wrong side of the struggle at the time of the American Revolution because we knew so little about what really was at stake.


http://www.christianforums.com/t7653888/

An apology to all Americans from a Canadian, and a thank you!
Some of my ancestors were Masons from Dixie who came to Country Harbour, Nova Scotia at the time of the American Revolution. I deeply appreciate the fact that so many Americans were closer to God than we Canadians tend to be and somehow your leaders were guided to not persecute us!

I also wish to apologize for the fact that the leadership of my nation was less guided by the Holy Spirit and we did not understand how the independence of America was comparable to the division of the Northern Kingdom of Israel from the Southern Kingdom of Judah at the time of King Rehoboam the son of Solomon.

I also wish to apologize for our elitism because it has been playing a significant role in your economic crash of 2008. If a higher percentage of Americans understood the full implications of truly wise monetary policy the world would begin to look quite different indeed!

Chapter 49 — The History of Banking Control in the United States
http://www.michaeljournal.org/plenty49.htm

 

The problem with the currency acts was that they were pretty much unenforceable, except in places like New York City, Boston, Philadelphia and Charleston.
The net effect was pretty much nil. The population of the 13 colonies in 1776 was about 2.5 million, the largest city was Philadelphia with a population of 40,000, NYC had maybe 25,000 and Boston was a whopping 15,000. Charleston, SC was about 12,000 and Newport RI maby 11,-000. That means that maybe 5% of the population was impacted by the currency acts. Such things had little real economic impact, but the symbolism was toxic to the Americans.

 

Again an exceptionally informative reply Curmudgeon! Thank you...… but....... there are some statistics from just after the Civil War that do seem to indicate that there are a group of people who wish to keep the money supply low so that unions stay weak..... or are broken altogether?

http://www.michaeljournal.org/plenty49.htm

Curmudgeon......… in your opinion are there a few families so astonishingly wealthy.... that those 56,446 business owners who went bankrupt..... would mean nothing to them because those people were mere pawns in the grand plan?

Those 56,000 business owners were not in a high enough class in society to be the people that they got together with to play Bridge or Hearts..... or polo....or golf..... or whatever it would be that they considered a cool passtime.

 

But I must admit ..... that the problem actually lies with all of us because a tight money supply is actually one of the best ways to protect the environment...… and around that time in history our ancestors were in a mentality of consumption that certainly rivaled the consumerism of today.

Here was how I worded the plus side to this back in my 2004 campaign for municipal office:


http://www.bankingsystemflaws.blogspot.ca/

...…

 

No the American Revolution occurred because of the Freemasons, or the Templars..........might have been the Illuminati. Probably all three of them colluded in secret which begs the question when a Freemason, a Templar and an Illuminati meet which secret handshake do they use?

 

Here is an interesting article on how that quote is fake: http://www.garynorth.com/public/6882.cfm

 

So I take it that you feel that this paragraph from the article in the OP is greatly exaggerated?



http://rense.com/general66/nobeyb.htm

 

Thank you immensely DarkDaimon for the link into this excellent article on this subject!!!!

Wow!!!!!

 

LOL!

Good one reallybigjohnson!

But........ is there a group of people in America as well as in England and Canada who regard strong unions as one of the world's greatest evils?

Within that group of people are there a few who would probably be willing to do something to make unions weaker and lower the expectations of voters?

 

I don't think so. It may have played a role, and even a bigger one than is generally thought, but my reading in this area was that the really major problems were in taxation and military abuse. By taxation I don't mean the old cliché of "taxation without representation" because the colonies were offered just such fairly early on in the conflict, and they turned it down. Taxation of the represented Brits was about 25 x what Americans had been paying. No. the problem was mainly that the Brits were treating the colonies as occupied territory. They had been what we today would call "autonomous" and the Central government wanted to reassert their power. They decided to do so militarily and that was a big mistake as the Americans saw themselves as Englishmen with the rights all Englishmen were entitled to

 

A very complicated one.

They just have their agents all kill each other

 

Most likely exaggerated and probably taken out of context. Rense is not a very credible source for anything.

 

Good point! But Americans in large numbers back in 1776 would not have taken up arms against Great Britain unless they had extremely good reasons to do so!

 

Freemasons, Templars and Illuminati……. like every other religion on earth at this time….. will be transformed in many positive ways by the opening up of the Gates of Knowledge and Understanding that is occurring at this time.


http://www.thomastwin.com/7 A Thomas samples.html

Freemasons, Templars and Illuminati would all tend to be more than a little interested in the fascinating tradition that Rabbi Yeshua - Jesus had an identical twin brother, Judas Didymus Thomas, (Doubting Thomas).

 

Thank you for this other good and possible explanation for what happened at that time?????!

 

Actually, about 60% just wanted to sit it out. They wanted it to go away. Only about 40% actively chose sides, and those split about evenly. The fighting between the two activist factions, especially in the more rural frontier areas was particularly vicious. With each side slaughtering isolated families who were on opposing sides (a lot of times these were feuds over issues that predated the war, but the war made a good excuse). After the war, it is estimated that between 65,000 -70,000 of those who had remained loyal to the Crown fled to other parts of the British Empire. That constituted about 15% of the loyalists. What most people forget is that the American Revolution was as much a Civil war as it was a war for Independence.

 

Interesting discussion and something I never really pondered.

I think the 'taxation without representation' reasoning is an over-simplification; history distilled to a bullet point.

My understanding has been that the gripe was that the taxes that were paid went to support England's empire and little to nothing for the Colonies.

Maybe there was a larger hand moving events and the tax issue was used to 'fire the hearts' of Colonists as a means to an end.

 

The tax issue was easy symbolism and made for easy propaganda, and the Brits were really bad at explaining why the taxes were justified. They had spent a huge amount of British Taxpayers money in defending the Colonies during the French and Indian Wars, while the colonists had paid almost nothing. But the Brits imposed the taxes in a very ham fisted way, and they were imposed by Parliament which was chosen only by those in Britain. Thus taxation without representation. But this goes to an even deeper issue about the relationship between the Britain and it's American colonies. The early colonies were originally corporations given grants in the New World by the King, not by Parliament which was relatively powerless. In the early 1600's when King Jame I came to the throne, the monarchy was pretty absolute, and it was James that gave the grants of land in the New World to the Plymouth Company, the London Company. Those colonies became directly subject to the King by about 1630 as Massachusetts and Virginia, other colonies were established as grants to specific individuals to whom the king owed a great deal of Money, such as Maryland (the Calverts) and Pennsylvania (the Penns). Meanwhile the Swedes colonized what would become Delaware but that was shortly taken over by the Netherlands along with New Jersey and New York. These came under English Control in 1664, which is as we will see in a moment significant.

In 1642 the relationship between the Monarchy and the State began to change in fundamental ways. Because in 1642 Parliament raised an army to oppose the King and fought a 9 year long civil war against the king. At the end the King (Charles I) was beheaded in 1649,and his successor was exiled. This was the period when Oliver Cromwell became the Lord Protector of the Realm and virtual dictator of Great Britain, known as the Commonwealth. When Cromwell died in 1558 and his son Richard resigned in 1559 Parliament allowed Charles II to return and take up the throne. Now instead of Parliament serving at the pleasure of the King, the King served at the Pleasure of the Parliament. And Parliament was dominated by the Landed Gentry in the House of Lords, and the Commercial interests in the House of Commons.

During that 18 year period Great Britain transformed itself from a limited (by the Magna Carta) absolute monarchy to a proto-Constitutional Monarchy with the Monarch answerable to Parliament. However, in the Colonies, not much changed. What was going on in Great Britain didn't effect what was going on in the Colonies all that much. Charles II was very careful to not annoy Parliament and his reign was pretty smooth. However when he died in 1685, his son, James II came to the throne and managed in short order to annoy the Parliament to the point that they decided to invite the next closest non-Catholic relative (The Stuart Kings were Roman Catholic) who was in line to the throne, Jame's daughter Mary (who had converted to Anglicanism) who was wife to the Prince of Orange who was the Sovereign over parts of the Dutch Republic and was also a Protestant, to come and kick James II off the throne, and the Parliament would finance the adventure. So in 1688 in what is now called "The Glorious Revolution" William and Mary jointly ascended to the Throne and James II went into exile in France. In 1689 Parliament passed The Bill of Rights, the second part of what has become the British Constitution, which among other things makes Parliament the Sovereign power of Great Britain, and making Great Britain a true Constitutional Monarchy.

Again, this shift in power generally went unnoticed in the Colonies and it wasn't until after the French and Indian wars that the Colonists began to understand the change in relationship between Parliament and the Crown and how that impacted the relationship between the colonies and the Mother Country. The colonists believed they held their rights and lands directly from the King, but now the King was subject to the will of Parliament and the Parliament could pull the strings. And the Colonists had no say in the choosing of Parliament. Granted they had no say in the selection of the King, but there was a long tradition of known responsibilities between the people and their King that was well understood. Now Parliament was changing the rules without the colonists having any input or influence in these changes.

The bottom line is that the root causes of the Revolution are very complex and the result of complex changes in the governmental structure of Great Britain, but they don't make good sound bytes or good propaganda or easily understood justifications for rebelling against the legitimate government or committing high treason. Taxation without Representation, and the other grievances enumerated in the Declaration of Independence (the part that kids aren't required to memorize in grade school). Notice that they don't directly blame Parliament, but direct their anger at the King, and ignore the fact that the King is not the one responsible for these things.

 

But what about these statistics from after the Civil War from another forum?

Was the money supply shrank after the assassination of President Lincoln?

Did 56,446 businesses go bankrupt in a decade largely due to this decrease in the money supply?


http://www.michaeljournal.org/plenty49.htm

 

I first ran into this theory back in 1994 and I tried to make more people aware of this in all three of my campaigns for public office.

www.BankingSystemFlaws.blogspot.ca/

 

What you are seeing is common after modern wars, and the U.S. Civil War was the first truly modern war. It was a war powered by a huge industrial base, especially in the north. The Government borrowed and spent huge amounts of money purchasing the weapons of war and providing the provisions needed to keep huge numbers of troops fed, clothed and in the field. Between 1861 and 1865 the Union army grew from 16,000 men to nearly a million (2.2 million served during the war on the Union side, but not all of them at once). Thousands of businesses were created to meet the demand for keeping that Army going.

Then between 1865 and 1866, most of those 2 million men were mustered out of the military, this is not counting the Confederate soldiers who were also mustered out (the Confederate Army was about 1/3 the number of the Union Army) . But of course the government was no longer buying all of that military hardware, so the flow of money through the economy tightened up rapidly. Many of the businesses that depended on the government to purchase their products, especially the smaller ones, went out of business. The banks were owed a great deal of money by the Government, but those loans were to be paid back over time, and the banks were largely tapped out of funds to lend anyone except their very best customers.

Thus you had all of the makings of a major post war recession or depression. This wasn't some sort of plot by the financial industry of the time to tank the economy, this was normal economics. It happened in Europe at the end of the Franco Prussian War in 1870-71, and again after WWI, and WWII. There is plenty you can blame on bankers and the financial industry, the Great Depression, other financial panics, the Great Recession. As most who post on these boards know by now, I am a big fan of Elizabeth Warren and Bernie Sanders. And I personally think that the too big to fail banks should have been broken up into dozens of smaller banks each.

But the Conspiracy theorists like Rense, Alex Jones, et al. are loons. The illuminati, Bilderbergers and assorted other cabals do not control the world, do not sit and plot out economic crises. The sure proof of this is this, if such a group actually did what the conspiracy theorists claim, don't you think they would do a much better job of it? Every time the markets crash and burn they loose billions and trillions. If they were competent conspirators those crashes would not occur, wars would not be allowed to cause too much infrastructure damage, etc.

No it is pure greed on the part of the Bankers, and the conviction that they actually understand what the huge economic markets are actually doing and that they can manipulate them intelligently that causes the major financial collapses. Hubris fueled by greed is what brings economies to their knees.