US Federal Reserve Act of 1913
Executive Summary
- This banking act brought into existence the Federal Reserve Bank of the US, which is the US central bank.
Introduction
The US Federal Reserve act was passed before Christmas and written in a way such that those that voted on it could barely tell what it meant. The promoters of the act granted fake concessions to put the mind at of east of those that opposed a private central bank. If the politicians knew what they were voting for, it is unlikely this act of 1913 would have been passed. This quote from US Congressman Charles Limburgh described what he saw as the reason for this act.
“The Aldrich Plan (the first name for the US Federal Reserve Act) is the Wall Street Plan. It means another panic, if necessary, to intimidate the people. Aldrich, paid by the government to represent the people, proposes a plan for the trusts instead.” – AZ Quotes
Woodrow Wilson was run by Morgan Bank in the 1912 election and only won because Morgan Bank split the ticket against Willam Taft by bringing Theodore Roosevelt out of retirement. Wilson ran against a central bank. However, just one year later the Federal Reserve Act is passed. Wilson’s involvement is explained in the following quotation.
Progressives, including William Jennings Bryan, fiercely opposed it because they wanted central banking under public, not private, control. Democrat Woodrow Wilson agreed that the plan was unacceptable in a democracy and killed it during the 1912 election. He articulated his position on centralized banking power on the campaign trail: “The great monopoly in this country is the monopoly of big credits. So long as that exists, our old variety and freedom and individual energy of development are out of the question. A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men, who, even if their actions be honest and intended for the public interest, are necessarily concentrated upon the great undertakings in which their own money is involved and who, necessarily, by every reason of their own limitations, chill and check and destroy genuine economic freedom … and the true liberties of men.” Once in office, the Wilson administration set out to form a central bank to meet the needs of private bankers but allay Populist fears. The 1913 Federal Reserve Act reflected such a compromise. The act created twelve regional Federal Reserve banks across the country with the ability to offer transaction services and make emergency loans. These banks’ shares would be owned by “member banks,” individual banks within the geographic district that joined the system. They could also elect a majority of its directors. But a centralized Federal Reserve Board, appointed by the president and confirmed by the Senate, would have the final say about policy and make national monetary policy. The system was a blend of private and public, regional and central, Progressive and capitalist, Hamiltonian and Jeffersonian. It was a nod to big banks, small banks, and Populists, merging a desire for order and efficient banking on one hand with a fear of concentrated banking power and the control of money in the hands of a few on the other.The central bank was up and running by 1914, but it had yet to gain the tools required to stem the panic of the Great Depression. The bank would grow much more powerful and centralized over time—in parallel wit
Source: How the Other Half Banks
https://www.amazon.com/How-Other-Half-Banks-Exploitation/dp/0674286065