In 1985, I was a resident of Rancho Sante Fe, California, and a member of the prestigious Rancho Sante Fe Golf and Country Club. I often played golf with "Jack" (not his real name), who was listed in Forbes magazine as one of the 400 richest people in America. On one occasion, as we were walking down the fairways, I talked about the evils of a rising federal debt, then about $1.8 trillion.
After some 20 minutes of talk (mostly mine), Jack stopped walking and said, "Gus, you worry too much about the federal debt. I hold $15 million worth of federal T-bills. They're risk-free, and they're paying me over a million dollars a year in interest. The higher the debt goes, the more T-bills I will buy, and the more interest I will get. Anyway, tomorrow, Madge [his wife] and I are flying to Tahiti for two weeks, and I'm not going to worry about the federal debt. It's a money- maker as far as I'm concerned."
Today, the federal debt is over three times as large as it was when Jack told me what the debt is really all about. His message was: "There is big money in it for the financial elite . . . individuals with considerable discretionary wealth, banks, insurance companies, securities brokers, currency speculators, and others who build fortunes on debt and on the backs of people who pay the interest."
Without the general populace being aware, the monetary system of...