With explanations provided by Gottfried Feder, Dipl. Engineer
Contents
The Manifesto
for the Abolition of Enslavement to Interest on Money
a. What is
Mammonism?
b. What is the
cure for Mammonism?
c. The nine
points of the Manifesto.
Implementation
and Rationale
1. Because of failed promises of the German Revolution
of 1918 the people are tending more and more toward Bolshevism.
2. The German folk are sick with Mammonism.
3. Mammonism derives its power from interest on loans.
4. The way to cure Mammonism is by abolishing interest
on loans, especially war-bonds.
5. The vast majority of Germans holding war-bonds
really lose money because of them, because they have to pay taxes to cover the
interest payments; only the largest holders of war-bonds have a net profit from
them.
6. Germany’s real wealth consists not in any material
assets but in the productivity of the German people.
7. If the obligation to pay interest on public debt
were ended, the Bavarian state could abolish all direct and indirect taxes and
fund itself entirely on the revenues from state-owned industries.
8. Interest-payments are the reason why the state
cannot do without taxes; those receiving the largest sums of interest pay
relatively little in taxes. The Reich is financially in a much worse situation
than the federal states.
9. Comparison of the affluent bondholder, the
working-class bondholder, and the dependent bondholder. Expansion of social
welfare for the dependent bondholder after cancellation of interest.
10. Instead of repaying the principal of war-bonds
under cancellation of interest the state could simply declared the bonds to be
currency.
11. For other fixed-interest assets, including
mortgages, repayment under cancellation of interest is recommended. This should
solve the housing problem.
12. A history of opposition to interest-slavery.
a. Curtailment and prohibition of interest before the
19th century.
b. Enshrinement of interest under the developing
global order during the 19th century.
c. Cancellation of interest will dissolve the
interest- community within Germany and enables the German nation to unite
against the Gold International.
The Conversion
of War-Bonds into Bank-Credit
Rather than simply declare war-bonds to be currency, a
better idea is to require that they be surrendered for conversion into
bank-credit.
Special
Comments on the Demand for Laws
in the Manifesto
Elaboration of
the nine points.
The Objections
and their Refutation
Objections from various perspectives are addressed.
a. Three objections based on a failure to comprehend
how conditions would change under abolition of interest-slavery.
b. A question from the perspective of a large bondholder.
c. How is depriving investors of interest supposed to
help the worker? d. What about the importance of inheritance in holding
families together? e. Three objections from officials of the current system.
f. The Communist complaint that abolition of interest
will not abolish economic inequality.
g. Social-Democracy is doomed because it is based on
Marxist ideology, which does not recognize the radical difference between
industrial capital and loan-capital. Social-Democratic government, as a
moderate application of Marxism that fails, paves the way for Communism.
h. The contemptible bourgeois and two objections from
the bourgeois perspective. Won’t abolition of interest adversely affect
savings? No. Is big loan-capital really not in some way productive? Only
labor is productive.
Further Program
a. Abolition of interest-slavery is the prerequisite
for establishment of the social state.
b. Reconstruction of the German state according to the
true spirit of socialism.
c. Liberation of the entire world from Jewish control.
Manifesto for the Abolition of
Enslavement to Interest on Money
Mammonism is the heavy, all- encompassing and overwhelming
sickness from which our contemporary cultural sphere, and indeed all mankind,
suffers. It is like a devastating illness, like a devouring poison that has gripped
the peoples of the world.
By Mammonism is to be understood: on the one hand, the
overwhelming international money-powers, the supragovernmental financial power
enthroned above any right of self-determination of peoples, international big
capital, the purely Gold International; on the other hand, a mindset that has
taken hold of the broadest circle of peoples; the insatiable lust for gain, the
purely worldly- oriented conception of life that has already led to a
frightening decline of all moral concepts and can only lead to more.
This mindset is embodied and reaches its acme in
international plutocracy.
The chief source of power for Mammonism is the
effortless and endless income that is produced through interest.
From the thoroughly immoral idea of interest on loans
the Gold International was born. The mental and moral constitution grown from
the lust for interest and profiteering of every kind has led to the frightening
corruption of a part of the bourgeoisie.
The idea of interest on loans is the diabolical
invention of big loan-capital; it alone makes possible the lazy drone's life of
a minority of tycoons at the expense of the productive peoples and their
work-potential; it has led to profound, irreconcilable differences, to
class-hatred, from which war among citizens and brothers was born.
The only cure, the radical means to heal suffering
humanity is the abolition of enslavement to interest on money.
The abolition of enslavement to interest on money
signifies the only possible and conclusive liberation of productive labor from
the hidden coercive money- powers.
The abolition of enslavement to interest signifies the
restoration of the free personality, the redemption of man from slavery, from
the curse whereby Mammonism has bound his soul. Whoever wishes to fight
capitalism, must abolish enslavement to interest.
Where must the abolition of enslavement to interest
begin? With loan-capital! Why? Because loan-capital, compared to all
industrial big capital, is so overpowering that the great money- powers can
only be fought effectively through the abolition of interest-slavery.
20:1 is the proportion of loan-capital to industrial
big capital. The German people must annually raise more than 12 billion in
interest for loan-capital in the form of direct and indirect taxes, rent, and
the rising cost of living, while even in the boom-years of the war the sum-
total of all dividends distributed by the German joint-stock companies amounted
to only 1 billion.
The avalanche-like growth of loan- capital
surpasses all human capacity for calculation, through eternal, endless, and
effortless income from interest, and from interest on interest.
What blessing does the abolition of enslavement to
interest bring for the laboring folk of Germany, for the proletarians of all
countries of the Earth? The abolition of enslavement to interest gives us the
possibility of pursuing the repeal of all direct and indirect taxes. Hear
this, you value-producing men of all lands, all states and continents: all
state revenues flowing from direct and indirect sources pour constantly into
the pockets of big loan-capital.
The profits of state-owned businesses, including the
postal service, telegraph, telephone, railroad, mines, forests, and so on,
suffice entirely for the funding of all essential state commitments for
schools, universities, courts, administrative agencies, and social welfare.
Thus no true socialism will bring any blessing to
humanity as long as the profits from public enterprises remain tributary to big
loan-capital.
Therefore we demand as a fundamental law of the state,
first for the German peoples, then as a fundamental law for all those kindred
peoples that wish to enter with us into the cultural community of a league of
nations, the following:
§ 1. War-bonds, along with all other debt-instruments
of the German Reich, along with all other debt-instruments of the German
federal states, especially railroad-bonds, as well as debenture-bonds of all
local governments, are declared, under cancellation of the obligation for
interest, to be legal tender for the face-value [or rather are to be converted
into bank-credit].
§ 2. With all other fixed-interest papers, covered
bonds, industrial bonds, mortgages, etc., the obligation for interest is
replaced by the obligation to repay the principal; thus after 20 or 25 years,
depending on the interest- rate, the lent capital is repaid and the debt
retired.
§ 3. All real-estate debts, mortgages, etc.,
are to be paid off on installments of the same amount as the payments required
hitherto, in keeping with the charges recorded in the land-register. The
property in houses and land freed from debt in this manner becomes partly the
property of the state or of the local government. [In this way the state
becomes better situated to control and to lower rents.]
§ 4. The entire monetary system should be under the
state's central bank. All private banks likewise; postal-check banks, savings
banks, and credit unions, all become affiliated as branch-operations.
§ 5. All credit for real estate is awarded only
through the state's bank. Personal credit and commercial credit are mandated to
private bankers under a concession from the state. This concession is granted
based on consideration of need, with a ban on the establishment of branches for
certain districts. The scale of charges is fixed by the state.
§ 6. Equity-securities are paid off in the same manner
as fixed- interest papers at the annual rate of 5%. Excess profits are paid out
in part to the stockholders as compensation for “risked” capital (in contrast
to fixed-interest and coin-backed papers), while the remaining surplus, by the sovereign
right of labor, is either socially distributed or applied for the reduction of
the prices of products.
§ 7. For all persons who for physical reasons
(advanced age, illness, physical or mental work- disability, extreme youth) are
not in a position to earn their livelihood, the interest-incomes from present
capital assets continue to be paid as a pension at the same, and eventually even
increased levels, in return for delivery of securities.
§ 8. In the interest of a reduction of the current
inflation of paper money, a universal, strongly graduated tax on war-bond
certificates and other debt- instruments of the Reich and of states is enacted.
These papers are to be pulped.
§ 9. Through intensive enlightenment of the people, it
is to be made clear to the people that money is and should be nothing other
than a voucher for completed labor; that while every highly developed economy
of course has need of money as a medium of exchange, the function of money also
ends with that, and in no case should money be lent a supramundane power to
grow of itself by means of interest, at the expense of productive labor.
Why have we not already done all this, which is so
self-evident, which must be regarded as the Egg of Columbus for the social
question? Because in our Mammonistic blindness we have unlearned how to see
clearly that the doctrine of the sanctity of interest is a monstrous
self-deception, that the gospel of the loan-interest that alone makes one
blessed has entangled our entire thinking in the golden web of international
plutocracy. Because we have forgotten and are deliberately kept in confusion by
the omnipotent money- powers about the fact that -- except in the case of a few
rich people -- the interest that seems so lovely, and is so beloved of the
thoughtless, is completely offset by taxes. All of our tax-legislation is and
remains, so long as we do not have liberation from enslavement to interest,
only a tribute-obligation to big capital, and not, as we would imagine, a
voluntary sacrifice for the accomplishment of labor for the community.
Therefore liberation from enslavement to interest on
money is the clear motto for the global revolution, for the liberation of
productive labor from the chains
of the supragovernmental money-powers.
Implementation and Rationale We stand in the midst of
one of the most grievous crises that our impoverished folk has had to endure in
its painful history. Seriously ill is our folk; seriously ill is the entire
world. Helplessly the nations stammer; a passionate longing, a cry for
redemption passes through the gloomy masses. With laughter and dancing, with
cinema and pageantry, the folk seeks to forget its own lamentable destiny -- to
forget about its disillusioned hopes, about the deep inner pain, about the
terrible disappointment over what one would so gladly call “gains of the
revolution.” But how did we imagine it all differently? How did all the fine
promises run differently? All that we hoped to gain in the dark of night, in
the darkness of our military collapse, seemed to be glistening gold, but now,
when the gray day illuminates the find, it is all rotten bits of wood. Now we
stand here at a loss. For the sake of these rotten bits of wood that shone so
finely in the night, we have thrown away everything that hitherto was dear and
valuable to us, and have stuffed all our pockets with this lamentable trove. No
wonder that the rage of despair grips precisely the poorest of the poor, and
that they rage in senseless wrath against their own brothers, and in their deep
longing for redemption seek to destroy all that stands in the way. This
condition must lead to utter madness, if consciencelessness and stupidity goad
the people further.
And whither this madness leads, we see in Bolshevik
Russia. Nationalization, as socialization is called in Russia, has proven to be
a failure, declares an unperturbed Lenin. The economy is destroyed, the
buying-power of money down to nothing, the intelligentsia killed, the laborer
without bread. Despair in the entire people; only bloody terror based on
Chinese and Latvian mercenaries is able to protect the Red dictators from the
vengeance of the betrayed folk. Among us too the development will follow this course,
if international speculators, obsessed party-fanatics, representatives of the
most grievously burdened bourgeoisie, and members of a race most deeply alien
in nature to the German folk, continue to be allowed in the government.
What indeed were those pretty, pretty words that one
whispered into our ear? Negotiated peace, League of Nations, parliamentarism,
sovereignty of the people, democracy, dictatorship of the proletariat,
socialism, destruction of capitalism, liberation from militarism, and other
such pretty slogans. A new free people was supposed to arise, which should
determine its own destiny.
None of any of that has come true, was able to come
true, or ever could come true, if we do not with the highest moral seriousness
investigate all these apparitions, all these slogans -- if we do not
conscientiously test the symptoms of the illness like an intelligent, concerned
physician, and painstakingly diagnose the present condition of the sick person,
sparing no effort to ascertain whence this serious critical illness arises.
* * * * *
The sickness of our age is called Mammonism.
What is Mammonism? Mammonism is the sinister,
invisible, mysterious reign of the great international money-powers. Mammonism
is however also a mindset; it is the worship of these money-powers on the part
of all those who are infected with the Mammonistic poison. Mammonism is the
unlimited hypertrophy of the -- in itself healthy -- human drive for
acquisition.
Mammonism is the lust for money grown into a madness,
which knows no higher goal than to pile money on top of money, which seeks with
unequaled brutality to coerce all forces of the world into its service, and
must lead to the economic enslavement, to the exploitation of the work-potential
of all peoples of the world. Mammonism is the mindset that has led to a decline
of all moral concepts. Mammonism considered as a worldwide phenomenon is to be
equated with brutal, ruthless egoism in man. Mammonism is the spirit of greed,
of boundless desire to rule, of the mentality entirely focused on seizing the
goods and treasures of the world; it is at its core the religion of the purely
worldly- oriented human type.
Mammonism is the direct opposite of socialism.
Socialism, conceived as the highest moral idea, as the idea that man is not in
the world only for himself alone, that every man has duties toward the
community, toward all humanity, and that he is not only responsible for the
momentary wellbeing of his family, of the members of his tribe, of his folk,
but that he also has unshakable moral obligations toward the future of his
children and his folk.
More concretely, we must see Mammonism as the
conscious collusion of the power-hungry big capitalists of all peoples.
Noteworthy in this has always been the hidden arrival of Mammonism.
The big tycoons lurk indeed as the ultimate driving
force behind world- encompassing Anglo-American imperialism; nothing else. The
great money-powers indeed financed the terrifying mass-homicides of the World
War. The great money-powers have indeed, as owners of all great newspapers,
woven the world into a web of lies. They have with satisfaction whipped up all
lower passions, have diligently fostered the growth of present tendencies, and
have through clever press-propaganda brought French revanchism to a boil. They
carefully nurtured the Pan-Slavic idea, the Serbian conceit of being a great
power, and the need of these states for money, to the point that the world
conflagration must ignite.
Even among us in Germany the spirit of Mammonism that
wanted to know only more export-figures, national wealth, expansion, big bank
projects, and international finance deals, led to a rout of public morality, to
the decline of our ruling circle into materialism and hedonism, to a
superficiality in our national life, all factors that share blame for the
terrifying collapse.
* * * * *
With astonishment we must ask ourselves whence
Mammonism, whence international big capital derives its irresistible power.
It is not to be overlooked that the international
collaboration of the great money-powers represents a completely new phenomenon.
We have no parallel for this in history. International obligations of a
monetary nature were practically unknown. Only with the rising global economy,
with general global commerce, did the idea of international interest-economy
establish itself, and here we touch the deepest root, here we have hit upon the
innermost source of strength from which the Golden International draws its
irresistible power.
Interest, the
effortless and endless influx of goods based on the mere ownership of money
without any addition of labor, has caused the great money-powers to grow.
Loan-interest is the diabolical principle from which the Gold International was
born. Loan- capital has firmly attached its blood- funnel absolutely
everywhere. Like the arms of an anemone big loan capital has ensnared all
states, all peoples of the world.
Government loans, government bonds, railroad bonds,
war bonds, mortgages, covered-bond obligations -- in short loan-instruments of
every kind have in a manner ensnared our entire economic life, so that
henceforth all the peoples of the world wriggle helplessly in the golden webs.
For the sake of the interest-principle, in keeping with a thoroughly mad
political delusion that every kind of possession carries an entitlement to
earnings, we have submitted to enslavement to interest on money. Not a
single real, valid moral reason can be given as to why mere possession of money
should bring an entitlement to perpetual interest- payments.
This inner opposition to interest, and to income of
every kind without any occurrence of productive labor, extends through the
soul-life of all peoples and times. But never has this deep inner resistance to
the power of money become so conscious for the nations as in our time.
Never has Mammonism been prepared in such a
world-encompassing manner to begin world-domination. Never yet has it placed in
its service all baseness, lust for power, lust for revenge, greed, envy, and
falsehood in such a cleverly concealed and yet brutally pushy manner as now.
The World War is at its inmost core one of the biggest decisions in the
evolutionary process of humanity in the struggle to decide whether in the
future the Mammonistic-materialistic worldview or the socialistic-aristocratic
worldview should determine the fate of the world.
* * * * *
On the surface, the Mammonistic Anglo- American
coalition has without a doubt been initially victorious. As a reaction against
it, Bolshevism arose in the East, and if one wishes to see a great idea in
Bolshevism, it is without a doubt the position diametrically opposed to the
Mammonistic worldview. The methods that Bolshevism seeks to employ for this
however are the botched cures of a Dr. Eisenbarth. They are the attempt to help
someone sick from internal poisoning with a scalpel, by amputating his head,
arm, and legs.
Against this rampage of Bolshevism, against this
senseless overturning, we must present a workable new idea that with unifying
force unites all laboring classes, so as to drive out the poison that has made
the world sick.
I see this means in the abolition of enslavement to
interest on money.
There are three factors that make interest on
loan-capital conspicuous as the authentic and true cause of our financial
misery.
First, the monstrous disproportion of fixed-interest
loan-capital, thus of capital that grows of its own accord without application
of creative labor, and indeed grows on forever. Among us in Germany this loan-capital
has already reached a level that we do not consider too high at 250 billion. In
contrast to this enormous sum, the industrial working capital of our entire
German industry stands at only 11.8 billion. In addition there is the 3.5
billion in capital of the 16,000 industrial limited-liability companies [G.m.b.H],
so that altogether we have only about 15 billion in industrial capital to
tabulate. 20:1is the first fundamental finding. [* Obviously 17:1 is
more accurate, but maybe Feder is allowing for the likelihood that the
proportion will increase.] This appraisal means that in financial problems of
the largest importance, all measures concerned with loan-capital must prove 20
times as effective as measures directed at industrial big capital.
Second: the interest-payment on the loan-capital
above, estimated at 250 billion, considered in its totality for all times,
amounts to about 12½ billion annually. By contrast, the sum-total of all
industrial dividends distributed in the year 1916 amounted in the year 1915 to
about one billion marks. In the preceding decades this number was, on the
average, about 600 million. In the last two years of the war [1914-1918] it may
very well have gone up considerably, but will record an all-the- greater crash
for the current year [1919].
The average profitability of all German
stock-corporations [A.G.] was 8.21%; thus only about 3½% higher than the
average return on fixed-interest loan- values.
Thus, I recapitulate, in the future the German people
will have to pay about 12.5 billion [annually] for the various eternal
interest-charges of big loan- capital, while the yield from industrial capital
in the greatest boom-year was 1 billion, and in times of undisturbed prosperity
only 0.6 billion. Thus we see again here a proportion on the orders of magnitude
of 20:1 to 12:1.
The third and most dangerous factor is the enormous
growth beyond comprehension of big loan-capital through interest and through
interest on interest. I must here digress a bit more and hope through a small
excursion into higher mathematics to explain the problem. First some examples.
The charming story of the invention of the game of
chess is well known. The rich Indian king Shihram granted to the inventor, as
thanks for the invention of the royal game, the fulfillment of a wish. The wish
of the wise man was that the king should give him one grain of wheat on the
first square of the chess-game, two on the second, four on the third, and thus
always on each square twice as many as on the one before. The king smiled at
the seemingly modest wish of the wise man and ordered that a sack of wheat be
brought so that for every square the grains of wheat could be apportioned. As
we all know, the fulfillment of this wish was impossible even for the richest
prince in the world. All the world's harvests in a thousand years would not
suffice to fill the 64 squares of the chessboard.
One more example: many will still remember from their
schooldays the torture of calculating compound interest; how the penny invested
at the time of the birth of Christ multiplies at compound interest so that it
doubles every 15 years. In the year 15 after the birth of Christ the penny has
grown into 2 pennies, in the year 30AD to 4 pennies, in the year 45AD to 8
pennies and so on. Very few will remember what value this penny would represent
today: a volume of gold equivalent to the volume of the Earth, the Sun, and all
the planets combined would not be adequate to represent the value of this penny
invested at compound interest.
A third example: the fortune of the House of
Rothschild, the oldest international plutocracy, is valued today at about 40
billion. It is well known that in Frankfurt around the year 1800, old Mayer
Amschel Rothschild, without wealth of his own worth mentioning, laid the
foundation for the gigantic fortune of his house through fractional- reserve
lending of the millions that Count Wilhelm I of Hesse had entrusted to him for
safekeeping.
Had the accretion of money through interest and
interest on interest with Rothschild succeeded only at the modest rate of the
penny, the curve would not have climbed so steeply as it has. But assuming that
the Rothschilds' collective wealth increased only at the rate of the penny, the
Rothschilds' fortune in the year 1935 would be 80 billion, in 1950 160 billion,
in 1965 320 billion, and with that it would already exceed by far the total
German national wealth.
From these three examples a mathematical law can be
derived. The curve that represents the rise of the Rothschild fortune, the
curve that can be derived from the number of wheat-grains for the chessboard,
and the number that the multiplication of the penny produces at compound
interest, are simple mathematical curves. All of these curves have the same
character. After initially modest and gradual increase the curve becomes ever
steeper and soon practically approaches being almost tangential to infinity.
Altogether differently, however, does the growth-curve
of industrial capital proceed. Likewise sprung mostly from small beginnings,
soon a strong escalation of the curves appears, until a certain saturation of
capital is reached. Then the curves run flatter, and in certain industries will
perhaps even decline slightly, if new inventions have led to the devaluation of
existing factories, machines, and so on. I would like to select only one
example here, the development of the Krupp works. In 1826 old man Krupp died
almost without assets. In 1855 Alfred Krupp received his first order for 36
cannons on behalf of the Egyptian government. In 1873 Krupp already employed
12,000 workers. In 1903 Frau Berta Krupp sold the entire works and property to
the Alfred Krupp joint-stock company for 160 million. Today the total value of
the stock-capital amounts to 250 million. What does the name Krupp connote for
us Germans? The acme of our industrial development. The world's first maker of
[steel] cannons. A vast sum of the most tenacious, purposeful, intensive
productivity. For hundreds of thousands of our folk-comrades the Krupp endeavor
has meant bread and work. For our nation, weapons and defense – and yet it is a
dwarf compared to the Rothschild billions. What significance does the growth of
the Krupp fortune during a century have compared to the growth of the
Rothschild fortune through effortless and endless accretion from interest and
interest on interest?
The two curves drawn in bold lines represent
loan-interest and indeed the upper curve shows the development of the
Rothschild fortune and the lower curve, at first flat and then rapidly rising,
shows in a very general way the characteristic development of all such curves,
in which a small advance on the horizontal axis can produce a doubling of the
value on the vertical axis. The hatched line shows the development-curve of our
total industry in the course of the last 40-50 years. The differently hatched
fine lines show the development of several randomly selected big industrial enterprises
from which the general character of the hatched curve of industrial capital is derived.
It must be expressly remarked that the curves of
loan-capital are shown strongly compressed. Thus for example the curve of the
Rothschild fortune must be set 80 times so high as the Krupp curve. The purpose
of showing the curves of course is only to demonstrate the fundamentally
different character of the two types of capital. The curves of loan-capital
show at first a quite gradually rising development; the development then goes
faster until, ever wilder and dragging everything with it, it raises itself far
beyond human concepts and strives toward infinity.
The curve of industrial capital by contrast remains in
the finite! However strong the divergences that a trace may show in detail,
overall the fundamental character of industrial development will always be such
that after strong initial development a certain period of maturity, of
saturation, follows, after which sooner or later the decline ensues.
Nothing shows us more clearly the deep essential
difference between loan- capital and industrial capital. Nothing can make the
difference clearer for us between the devastating effects of loan- capital and
the business-profits (dividends) of business-capital put up and risked in large
industrial enterprises, than this comparison.
It cannot be emphasized enough that the recognition of
the mathematical laws that loan-capital and industrial capital follow, alone
shows us the clear path where the lever is to be applied for setting aright our
wrecked finance- economy. We recognize clearly that not the capitalistic
economic order, not capital in itself and as such, is the scourge of humanity. The
insatiable interest-need of big loan-capital is the curse of all laboring
humanity! Capital must be! Labor must be! Labor alone can do little.
Capital alone can do nothing! Capital without labor can only be sterile!
Therefore the most important demand, the most noble task of the revolution, the
most sensible meaning of a world-revolution, is the abolition of enslavement
to interest on money.
The House of Rothschild today is valued at 40 billion.
The billionaires of American high finance, Misters Cahn, Loeb, Schiff, Speyer,
Morgan, Vanderbilt, and Astor, are valued together at 60-70 billion at the
least. At an interest-rate of only 5% this means an income for these eight
families of 5-6 billion, which, according to the researches of Karl Helfferich,
is roughly 75% of the annual income that all taxpayers in Prussia had in the
year 1912. (There were at that time around 21,000,000 taxpayers, 75% of that
would be about 15,000,000. For every taxpayer there are on the average 1.56 relatives;
hence 23 million relatives.) Around 38,000,000 Germans thus have had to live on
what the afore-mentioned billionaires have as a yearly income. Certainly the
American billionaires are not pure loan-capitalists in the same sense as the
House of Rothschild and so on. I do not care at all to argue about whether the
American billionaires are really “100-million-dollar millionaires” or
“1000-million-mark billionaires”; in the former case one would just have to reckon
in one or two dozen additional Croesuses. Or let us simply accept Rathenau's
“300”; then our inventory will certainly be in order. Here it is not important
to give an exact number, but the acknowledged ratio of 300 to 38,000,000 opens
our eyes about the brutal reign of international loan-capital.
Therefore let us cast off these terrible chains that
can only strangle all energetic labor; let us tear away from money the power to
bear interest, and ever again to bear interest until all humanity has become entirely
obligated for interest to international loan-capital.
Thus it is these three points that make clear to us
for the first time where alone the lever may be effectively applied for the
alleviation of our internal financial distress.
For another thing, we recognize that the assault of
the entire socialist world of ideas against industrial capital has been
completely off the mark, because even an intended complete regulation or socialization
of all entrepreneurial profit – assuming an unweakened economy – would yield a
laughably meager sum, compared to the enormous financial burdens of the budgets
of our Reich and our State.
Through the abolition of enslavement to interest on
money the entire financial malaise can be eliminated with one blow. At once we
feel solid ground under our feet again; at once it must and will become clear
to us that we have only deceived ourselves in the most grotesque manner with
this wretched bond-economy.
For what else is loan-capital, but debts? Loan-capital
is debts! One cannot repeat that often enough. What form of madness is it
when the German people in its totality have borrowed 150 billion for its war?
When it has even promised itself for this a quantity of 7½ billion in interest
and now feels itself shifted into the awkward situation, inevitable from the
start, of trying to collect this 7½ billion from itself in the form of entirely
fanciful taxes?
* * * * *
The tragic thing about this self-deception meanwhile
is less the stupidity of this whole war-bond economy, of which we have always
made so much better use than the rest of the world, than the fact that only a
relatively small number of big capitalists derives enormous benefit from it,
while the entire laboring folk, including the medium-sized and smaller capitalists,
as well as business, trade, and industry, must pay the interest. And here the
political side of the whole idea comes to light. Here they can recognize that
in fact big loan-capital and only this [i.e. not industrial capital] is
the curse of all laboring humanity. One may twist and turn the thing as one
wishes, but always the mass of all hard-working people must in the end bear the
cost of interest- payments on loan-capital. The middle- sized and smaller
capitalists have nothing to show for their lovely interest-payments; can have
nothing to show, for the sums of interest must be entirely taxed away. Whether
in the form of direct taxes or indirectly in the way of indirect taxes, stamps,
tariffs, or other burdens on commerce, the hard-working folk is always the
sucker and big capital the beneficiary.
It is now quite astonishing to see how the socialist
idea-world of Marx and Engels, from the Communist Manifesto to the Erfurt
Program (especially Kautsky), and even the current socialist leaders, spare
the interests of loan- capital as if on command. The sanctity of interest is
taboo; interest is the holy of holies; no one has yet dared to call it into
question. While property, nobility, security of person and possessions, the
laws of the Crown, privileges and religious conviction, honor of officers,
fatherland, and freedom are more or less outlawed, interest is holy and
unassailable. Confiscation of wealth and socialization, thus outright
violations of the law that are only somewhat sugarcoated, insofar as they are
committed ostensibly in the name of the totality of individuals, are the order
of the day: all of that is permitted, but interest, interest is the noli me
tangere, the “touchmenot.” The interest payment on the Reich's debt is the
alpha and omega of the state budget. Its gigantic weight drags the ship of
state into the abyss and yet … it is all a big swindle ... a monstrous self-
deception, fostered only and solely for the benefit of the great money-powers.
Here I would like to touch briefly now upon the
objections relating to small pensioners, to be discussed later, so that one
does not get hung up thinking about them. In the consideration of the very big
questions these are not considered, but it goes without saying that these compensations
will be provided through the broadest expansion of social-welfare services.
Swindle, I
said! Interest-swindle! A strong word. But if this word has
justification, which during the war was perhaps the most used word in the field
and at home, it has the most justification in regard to the interest-swindle.
But what about the war-bonds? With the first 5
billion, the Reich took out of the pockets of the people savings that actually
existed. The money flowed back again. Then came the new loan to suck up the
money again, and with that the last residual savings. And again came the pump
and sucked up the billions, and again they ebbed back again, until merrily,
after this charming game was repeated nine times, the Reich had incurred 100
billion in debt.
In exchange the people of course held in their hands
100 billion in finely printed paper – at first we imagined that we had become
so much richer – but then comes the state and says, “I am facing bankruptcy.” Yes,
but why? – I myself certainly cannot go bankrupt even if I occasionally take a
hundred-mark note from the right upper pocket and put it into the left.
Certainly it would be the biggest folly of all if we continued the folly of our
war- bond economy by declaring bankruptcy. [* Feder here is regarding the
German nation as a unified entity rather than a mere aggregation of
individuals: the money that has been transferred from some Germans to other
Germans remains within the German nation, which means that it is within the
power of the German government to adjust the distribution, perhaps to the
immediate disadvantage of some individuals but for the good of the nation as a
whole.] Let us break the enslavement to interest on money! Let us
declare the war-bond certificates to be legal tender with interest canceled, and
the nightmare of state bankruptcy will melt away from us like March snow under
the Sun.
People say to me, the cancellation of
interest-payments is a disguised state bankruptcy. No, that is not true! – The
specter of state bankruptcy is really only a fairytale and a bogeyman invented
by the Mammonist forces.
The book by Franz Röhr, Was jeder vom
Staatsbankerott wissen muß [What Everyone ought to Know about State
Bankruptcy], is completely stuck in Mammonistic ways of thinking. Although
the author in general quite clearly recognizes the economic problems that
threaten us through socialization, and although he advises emphatically and
correctly that in the end only a rebuilding of our economy can save us – he
cannot free himself from the superstitious belief in the sanctity of interest,
and therefore he depicts state bankruptcy entirely in accord with the interest
of Mammonism, as a completely terrifying catastrophe.
It is interesting to observe that Röhr, in spite of
better historical knowledge, cannot free himself from the Mammonistic view, and
notes in his closing word: “If the ruinous economic catastrophe is not averted,
no one will be spared by it,” while on page 81 he admits that the consequences
of public financial mismanagement have been partially reversed very quickly,
and on page 68 he says that in any case there should be no doubt that Russia
(in the last century) overcame these currency- crises without lasting problems.
On page 76 he says, while examining the effects of state bankruptcies, that although
of course profound economic problems etc. have occurred, by and large
neither the destruction of the state nor that of its economic strength
resulted. On the contrary a rapid revival of the national economy and a
recovery of public finances have been observed often enough. When the
author then continues for three more lines saying that state- bankruptcy
absolutely means economic catastrophe and causes infinite misery; I regret
being unable to follow this logic.
But back to our particular case! Which would be more
honest? To speak pharisaically of the unassailability of war-bonds while
oppressing the people with an egregious tax-burden? Or, if a finance-minister
had the courage to approach the people openly and to declare, “I cannot make
the interest- payments on the war-bonds, or I can only if I collect exactly the
same amount in taxes from you. “. . . . But back then during the war I
absolutely needed money; nothing more clever (see England) occurred to me, and
so I did the swindle with the high-interest war- bonds. You must forgive me,
beloved folk; it was ultimately all for you, but if we wish to play
hide-and-seek no more … I, the state, shall pay no more interest, and you, the
taxpayer, need not pay taxes to cover these interest payments…. That thoroughly
simplifies our transactions; we avoid the enormous tax-bureaucracy and likewise
the enormous interest- paying bureaucracy, thus conserving an immense quantity
of money and work- potential.” I have lingered long on exposing this swindle,
but I consider it absolutely fundamental here at no point to lose sight of the
big picture.
* * * * *
According to Bavarian tax-returns, the circle of
people that would suffer -- let us say, precisely those that according to their
tax-returns received over 30,000 marks in interest-payments -- are 822 people,
which is only 0.4% of those obliged to pay taxes (Bayr. St-Z. 1913) in
all Germany, therefore, approximately 10,000. (The upper 10,000!) Let us
clarify for ourselves now as briefly as possible the most important aspects of
this revolutionary demand, and indeed let us consider the questions first from
our national perspective.
For this there is first need of a clear look at our
current situation. Secretary of State Eugen Schiffer, in his big speech in the
Berlin Chamber of Commerce, has declared it “impossible to ignore.” That is
only partially correct. Possible to ignore is the enormous indebtedness
of our national economy, and the unprecedented devaluation of our currency --
in short, the fact that we have become an impoverished people overnight.
The burdens that are being imposed on us through the
peace-treaty, however, cannot be ignored. The currently existing certificates
of indebtedness, as we have seen, amount to around 250 billion. Let us assume
first that the Entente imposes on us an additional 50 billion in war-
reparations in some form: that makes a total of around 300 billion in debt.
However heavily it may strain the narrow confines of
this treatise, nonetheless some words must be said about the magnitude of
German national wealth. The investigations of Helferrich and Steinmann-Bucher
assess the German national wealth at around 350 billion. One can only attribute
very limited value to such findings, however carefully they may have been
derived. They are valid only for times of undisturbed economic activity. But
they are also quite misleading since state and municipal properties are
included, thus for example also road-repairs, waterway-modifications, and so
on. It is clear that although the production of such works may have cost
enormous money, nonetheless they have strictly speaking no intrinsic value. A
better yardstick for national wealth is so-called taxable wealth as it emerges
from the tax-returns for the defense-contribution or the wartime wealth-tax.
For this a sum-total of 192 billion results, thus much less by far than
Helfferich's figure. To this sum nonetheless about 10% may be added, according
to experience, for the legally tax-free small fortunes, and about an equal
amount for “silent reserves.” [* “Silent reserves” are the result of underestimating
positive values and overestimating negative values in accounting, so as to
create the appearance of the lowest possible net- worth.] In any case it seems
to me overly optimistic to speak of a national wealth of more than 250 billion.
But even this number has only a very limited importance. The most correct thing
would be to break away entirely from the idea of a national wealth that is at
all numerically graspable, and to penetrate to the recognition that national
wealth finds its expression exclusively in the mental and physical
work-potential of the entire nation, and thus belongs to orders of magnitude
that have no relation to the narrower concept of capital.
Indeed we must still see a further source of national
wealth in the presence of mineral resources, the riches of the forest, and
fertile soil, but these things also cannot be grasped numerically, since their
value fluctuates between zero and infinity, depending on whether the mineral
resources lie unexploited, or, based on a geological report, can be reckoned
for billions of tons of coal and so on.
Let us not forget that Germany really is a poor
country. Of monopolies it possesses almost none. In wealth of mineral resources
it stands far behind most of its neighbors, to say nothing of the unparalleled
mineral resources of the Chinese, Indian, and American empires. In fertility of
the soil it falls far short compared to the blessed fields of Russia's black
soil, and compared to the effortlessly productive stretches of tropical and
subtropical land. Therefore in the end we have always only the potential and
will of our people to work, as well as the availability of sufficient work, and
we must understand clearly that in this state of affairs there can be no talk
of secured debts, of collateral for our debt-instruments...
Whether interest-bearing war-bonds or
non-interest-bearing Reich banknotes, behind them stands only and solely the
tax-potential of the entire people – and what is tax-potential other than a
function of the work-power of the total working population? * * * * * We
must now clarify for ourselves yet another relevant complex of questions, and
of course the chief entries of our state revenue-sources and expenditures.
There is a remarkable contrast between the broad space that the concern for
making money occupies in our private lives, and the attention that we give to
the great questions of our state financial management, and yet between
individual economy and national economy no essential difference exists
whatsoever.
The chief entries for state revenue are: first, the
net profits of the post-offices and railroads; second, those of the mines,
forestry-administrations, and other state enterprises; third, tolls and
indirect taxes; fourth, direct taxes.
So as not to foster purely theoretical discussions in
such eminently practical questions, I want to elucidate the individual entries
from the Bavarian state budget[1] of the year 1911 according to their
order of magnitude.
Post, telegraph, and railroads[2] brought 120
million; forests, mines, etc., around 40 million; indirect taxes, 53
million; direct taxes, 60 million. An additional 67 million flowed from
stamp-duties, fees, inheritance-taxes, land-taxes, revenue-transfers from the
Reich, and so on.
What about expenditures? We find here in the first
place the payments for interest on the state debt including the railroad-debts
with 85 million. For the royal house, 5 million; administration of justice, 27
million; internal administration, 40 million; churches and schools, 51 million;
financial administration, 13 million; expenditures for Reich-related purposes,
50 million; pensions, 36 million. Miscellaneous expenditures 5 million. Back
then in this fortunate year of Bavarian finances the annual budget left a
revenue-surplus of 27 million.
In the scope of our thought however only those
expenditures concern us that can be omitted through the abolition of
interest-slavery. Here the interest- payment on the state debt naturally stands
in first place at 85 million marks; add to that the greatest part of our
payment for financial administration at about 10 million; furthermore a large
part of the payments for Reich-related purposes, of which let us add half, 25
million, and finally the 5 million in payments for the royal house are now gone:
a total of 125 million.
The disappearance of these entries means the
possibility of renouncing imposition of all direct and indirect taxes,
which, as we saw, brought in 53 million and 60 million marks, a total of 113
million marks! We are now not at all of the opinion that one should entirely
abolish direct and indirect taxes; unquestionably within reasonable limits they
serve on the one hand to educate, on the other hand to regulate. It is
certainly not more than right and fair that the profits from property owned
free and clear remain subject to a moderate, graduated tax, since the state of
course must also maintain secure ownership with its policing agencies. It seems
just as advisable that trade and industry be required to make tax-contributions
corresponding to their working profits, since the state also has to care for
the maintenance and development of public paths of commerce for them. A
corresponding minimum poll-tax for every citizen entitled to vote is likewise a
requirement of fairness, since care for the security of the person and his
property is also required from the state.
In the area of indirect taxes a strong expansion of
all pure luxury-taxes has a regulatory effect in the best sense, while all
simple foodstuffs and necessities of the people should be kept free of taxes! The
result of such a tax-policy would be found less in high revenues – about which
there can be no talk, since for the great mass of the population taxation
should be not a real burden but only a reminder that the person is not only an
individual essence but also a citizen of the state, and that in addition to
civil rights he also has civil duties.
Tax-revenues should be less necessary for paying off
the debts of state-owned businesses, whose net-profits, as we have seen,
suffice to cover the normal expenditures of the state for schools, universities,
administration of justice, internal administration, etc. Tax- revenues
should be used to advance special cultural tasks of the state for which
adequate resources were never available in the scope of the normal state
budget. Here I am thinking primarily about orphanages, institutes for the blind
and the crippled, daycare centers, care for expectant mothers, the battles against
tuberculosis, alcohol, and venereal diseases, and the construction of garden-
cities and settlements, especially for the accommodation and humane care of our
war-disabled.
* * * * *
Our view broadens. We see virgin land. Could the
abolition of interest-slavery mean the cancellation of all taxes? It would mean
that, if we had come out of this gigantic struggle as a victorious people. As
things are, let us not celebrate too early; the burdens imposed on us by our
enemies will make sure that we do not. But in any case we see virgin land based
on the indeed quite simple example of our Bavarian state budget that we just
used...
In general we find quite similar relationships in the
other German federal states, and it is not too much to say that from the surpluses
of the state-owned businesses, the railroads, post-offices, telegraphs,
forests, mines, and so on, all state expenditures for the entire administration
of justice, for all internal administration, including state
construction-projects, all outlays for schools and universities, just as for
cultural purposes, could be covered without difficulty. Thus a perfectly ideal
condition.
Why is that not the case? Interest has crept in.
Because of the payment of interest the population's foodstuffs become expensive;
because of interest sugar and salt, beer and wine, matchsticks and tobacco and
countless other necessities of daily need carry indirect taxes. Because of
interest, direct taxes must be raised, which are divided into land-taxes that
are passed on in the form of higher prices for grain, house- taxes that drive
up rent, business-taxes that burden productive labor, income- taxes that
unavoidably depress the living-standards of civil servants and people on fixed
salaries, and finally at the very end, modest in giving but insatiable in
taking, loan-capital pays taxes on capital dividends. According to the
tax-returns of the year 1911, out of 253 million in capital dividends received
in Bavaria, all of 8.1 million was paid in state taxes.
We have seen that all capital dividends, all interest
on capital, ultimately must be raised through the labor of the entire people.
We have seen that the interest- payment on public debts constitutes the largest
entry in our state budget, and we have seen that those obliged to pay taxes on
interest-payments make only an extremely limited contribution to state revenues.
In terms of relative magnitude, the capitalist paid 8
million out of a total of 60 million in direct taxes, which is only an eighth
to a sixth of the direct state taxes paid in Bavaria in 1911. Direct taxes
however are only about a fifth of the total state revenue. Therefore loan-
capital contributes only about a thirtieth to a forty-eighth share of the
state's total needs.
It should not be denied that tax- legislation during
the war, especially in the last years, resorted to a stronger tax on capital
dividends, but stronger indirect taxation has more or less kept pace with it,
so that the relative size has hardly changed.
The picture becomes dire when we consider the budget
of the Reich. Here the proportions in themselves are already much less
favorable. The Reich does not have the same tax-sources as the individual
federal states. Direct taxes are reserved to the federal states; the
enterprises of the Reich are limited to the Reich's post-office and railroad
(note that this does not include the Prussian state railroads), and
consequently only tolls and indirect taxes remain.
The orders of magnitude of the Reich's revenue-sources
(see Statistisches Jahrbuch für das Deutsche Reich for the years 1917
and 1918) were, in the year 1915, 1 billion in indirect taxes, 0.8 billion in
special revenues (war- contribution, matricular fees), and so on. Here too the
same picture again. More than a third, 1.3 billion to be specific, was devoured
already in the year 1915 by payment of interest on the Reich's debt. Here too
loan-capital pushed its way in again. Here too it requires all direct taxes to
satisfy it. Sugar pays 163 million, salt 61 million, beer 128 million, tobacco,
schnapps, sparkling wine, lamp-fuel, matches, playing cards, and countless
other items had to be taxed in order to scrape together a billion marks that
then flows completely into the pockets of the capitalists.
Today, how to pay the interest on the Reich's debt is
a riddle. Interest- payments alone devour 8 billion [annually], based on 100
billion in war- bonds plus other war-credits. Revenues from the post-office and
railroad can hardly be further increased. A further increase in tolls will
hardly be tolerated; therefore probably only a five- or ten- fold increase in
indirect taxes is left -- an impossibility! -- or the clear insight that only
and solely the abolition of enslavement to interest on money can bring us
salvation. An enormous self- deception is what the entire war-bond economy was.
The German nation borrowed a hundred billion from itself for its war. For that
it promised 5 billion in interest to itself; it must therefore pay 5 billion in
taxes. All benefit goes to the big capitalist, who draws so much in capital
dividends that he cannot possibly use it up, and yet only a quite modest
percentage is taken away through the tax on capital dividends, as we have seen.
* * * * *
I hope now through the main thrusts of my presentation
already to have dispelled the humanly comprehensible terror that many readers
may have of eventually losing the interest-income from their pretty
certificates. Let it just be demonstrated very briefly with one example that
the whole interest-economy is a big self-deception, and along with that I want
to look at an upper level of solid middle-class income.
Assume that the head of a household has an income from
labor of 10,000 marks, and on top of that another 5000 marks from capital
dividends. In the first place about 1500 marks of this will be paid in direct
taxes; then at least 1000-1200 marks in the form of high rents will be stripped
away for eternal interest. Another 1000 marks are likely to be drained off in
the form of indirect taxes for a family of five or six, and already now one
realizes that not much is left of the lovely capital dividends that the small
and middle-sized capitalists enjoyed under the happy tax-rates of earlier
years. Indeed, already today there can be no more talk of “surplus”; on the
contrary, if one examines for oneself today the current fantastic tax-
proposals, considerably more income from labor will probably be taxed away.
Naturally the situation seems to be quite different
for the big capitalist, who, let us say for example, collects only 1 million in
capital dividends. (Such people are fairly numerous in Germany today.) Of the
tax on capital dividends this fortunate man pays at the most 50-60 thousand
marks. Of indirect taxes he also pays no more than the family-father of the
previous example. On his budget after all he can still live quite comfortably
indeed with 40-50 thousand marks, even in the current expensive era. If roughly
a nice 900,000 marks cash remain to him, for that with 5% interest on loans he
will get another 45,000 marks in the next year and that, by law, at the expense
of the working population.
The small pensioner who only lives on his interest
undoubtedly would be harmed. If he is able to work, then he must of course
resolve to earn an income from labor. With that he then situates himself very
much better than the millions of his folk-comrades who have nothing other than
their physical or mental work-potential. If he does not want that, then he must
eat into his wealth. Ultimately he has 20 years to nibble at it again and
again, if he continues to consume the annual sum that he has been receiving at
5% interest. For persons that are not in a position to work, or are weakened by
illness or age, obviously an appropriate livelihood must be arranged through
the development of social welfare for all segments of the population.
I visualize social welfare as follows: Let us assume
that an older lady, a widow, who hitherto had to live on the interest from a
capital investment of 60,000 marks, is, through the legally proclaimed
abolition of interest-slavery, deprived of her source of income. Here, through
the broadest expansion of the pension-system, opportunity would be given the
afore-mentioned person to draw a pension corresponding to her capital,
wherewith the annual pension could even be increased relative to the previous
interest-yield, so as also to give a certain compensation for the diminished
value of money even to this circle of people. Thus, for example, in exchange
for the surrendered 60,000 marks in debt-instruments of the Reich, of the
states, or in covered bonds, an annual lifelong pension of 4000 marks could be
given. If the widow has children and she wants to will a portion of the wealth
to them, then it can be allowed to her that only 40,000 marks be transformed
into a pension, while the remaining 20,000 would be kept for the children. Out
of the 40,000 marks, depending on the age of the pension- applicant, up to 1/12
of the received capital could be given annually.
Furthermore, let it also be noted here that, with the
discontinuation of oppressive taxes as a result of the abolition of
interest-slavery, the widow's cost of living will be quite considerably
decreased.
It would greatly exceed the scope of this essay to
examine in detail the personal interests of each stratum of the population.
Such a revolutionary demand cannot be about personal interests; nevertheless as
the idea takes effect one will find that the healthful consequences personally
benefit every individual in the end.
Precisely by the problem already isolated above, of
how to achieve release from interest on war-bonds, I have tried to make it
clear already that small capitalists -- by which I mean all the hundreds of
thousands that have been induced through a hyper-American advertising-campaign
to devote their savings for subscription to war-bonds -- not only receive no
benefit from interest, since of course they must pay for it themselves with
taxes, but, with tax- legislation tailored for the protection of big capital,
must support interest- payments for million-mark subscriptions.
It seems to me that, apart from these immediate
considerations, an appeal to all for the sake of their children’s wellbeing
must in itself persuade the anxious bondholder to accept as completely natural
the renunciation of eternal interest from the Reich's debts. In this case, what
does the patriot, who has given 10,000 marks to his fatherland in direst need,
really lose, other than a usurious claim to draw 50,000 marks in interest
within a hundred years, without even diminishing the principal? Eternally his
children and grandchildren must work, just to pay all the interest.
* * * * *
The question of repayment of the lent sums can be
solved in various ways. In my briefly stated main ideas about the problem at
hand, which I submitted to the government of the People's State of Bavaria
[under Kurt Eisner] on 20 November of last year [1918], I proposed simply to
have repayment take the place of interest-payment at the rate of 5% annually
for 20 years. I believe that in what follows I can even make a much better
suggestion, which because of its simplicity certainly deserves preference: “The
war-bond certificates upon cancellation of interest will be declared to be
currency.” That is the Egg of Columbus. The advantage of this measure is in the
first place that nobody really feels anything from it. The war- bond
certificates continue to lie at rest in the depots; but no young people get
them, any more than a book, or a cabinet, or some otherwise useful object that
somebody would lend to his friend.
If one needs money, then one simply whips out a
war-bond note and pays with that. War-bond notes have, after all, just as much
beauty and paper-value as our other 10, 20, 100, and 1000-mark notes. There can
certainly be no talk of the market's being flooded with currency in such a
bump-free transition from the interest-economy into the interest-free national
economy. All the war-bond certificates are indeed already well protected and
stored in bank-vaults, or other places of concealment considered secure by the
people, such as a woolen stocking or a manure-heap. Indeed it cannot be denied
that our issued paper currency, as much as about 40 billion, is also not in
circulation but for the most part is hoarded in the manner described above. Our
need for currency in the times of economic boom before the war was also only
about 4-6 billion, and it is inconceivable that we would need more than twice
that much today in the ever more customary cashless economy.
[In a later section Feder states that he has decided
that simply letting war-bond certificates be used as currency is not the best
idea. He proposes that they should be converted into bank-credit instead.]
* * * * *
The cancellation of interest is to be done in
precisely the same manner for all fixed-interest assets. For these assets, just
as for dividend-yielding assets, the originally proposed “repayment” in 20 or
25-year annual pensions is recommended, especially for mortgages.
The abolition of interest-slavery for mortgages means
without a doubt the solution of the housing problem, the liberation from
exorbitant rents. It is not at all evident why the holder of a mortgage should
have the eternal benefit of interest from a sum lent once, why an effortless
and endless influx of goods should be granted to him, why the great mass of a
people, only for this unhealthy principle of interest, should pay high rents
year in, year out. Let it be interjected very briefly that self- evidently
there can be no talk of a complete cancellation of rent, since of course the
management and upkeep of houses demands constant labor and money. A lowering of
rents thus can only occur so far as it results of its own accord through the
accomplished repayment of mortgages.
Only one thing should be sharply emphasized, that the
abolition of enslavement to interest has not the slightest thing to do with our
total value- producing labor, insofar as no hindrance is posed in any way to
the entrepreneurial spirit, to productive labor, to the manufacture of goods, to
the acquisition of wealth. On the contrary, as we have seen, the entire working
folk is liberated from a stifling, unreasonable, heavy burden; our soul- life
is purged of an intoxicating poison.
* * * * *
We can tell how correctly the fruitfulness of the
interest-problem has been recognized in the course of history, by the fact that
minds in all ages and all peoples have been occupied with it...
In various passages of the Old Testament, such as
Leviticus 25 and Deuteronomy 15, we find regulations about the cessation of
interest in the form that the seventh year should always be an acceptilation or
jubilee, in which all debts of folk-comrades should be abated.
Solon in the year 594B.C. abolished personal
debt-slavery through legislation. This law was called the great Seisachtheia
(shaking off of burdens).
In ancient Rome the Lex Gemicia of the year 332
B.C. abruptly forbade Roman citizens entirely from charging any interest.
Under Justinian a prohibition on compound interest was
enacted, with the regulation that no more interest whatsoever should be
demanded when overdue interest has accumulated to the level of the sum
originally lent.
Pope Leo I (the Great) decreed in the year 443 a
general prohibition on taking interest; until then only clerics had been
prohibited from demanding interest on a loan. The ban on interest was now part
of Canon Law and also a binding regulation for the laity. Secular legislation
also gradually fell in line with canonic views, and even threatened punishment
for charging interest. We find this in the police ordinances of the Holy Roman
Empire for the years 1500, 1530, and 1577.
Of course such laws were now much opposed and
frequently circumvented, and in this quite short historical retrospective it
may only be mentioned as an astonishing historical fact that although under the
canon law of the 11th to 17th centuries the charging of interest was forbidden
to Christians, it was permitted to Jews.
It would be extraordinarily charming to investigate in
each instance what economic tumors led to these powerful shedding of burdens.
It would be especially valuable to see which powers and forces have violated
the prohibitions on interest again and again.
In the Middle Ages certainly short work was often made
of usurers; the farmers or citizens having been bled dry got together and beat
the profiteers to death. Today we have entered into a completely different
phase of the interest-problem. Such pogroms are most deeply disapproved.
Also it is no longer a matter of individual locally
confined symptoms of illness that could be combated by excising the pus-pocket;
what is happening is a serious sickening of all humanity.
* * * * *
It should be most emphatically stressed that precisely
our contemporary culture, precisely the internationality of economic relations,
make the interest- principle so murderous. The foregoing historical
retrospective should also not be regarded as providing an analogy for the
circumstances of today. When the Babylonians overcame the Assyrians, the Romans
the Carthaginians, the Germans the Romans, then there was no continuation of
enslavement to interest; there were no international world- powers. The wars
were also not financed through borrowing but with treasures accumulated during
peace.
David Hume gives a very nice overview of this in his Essay
on Public Credit. Only the modern age with its continuity of ownership and
its international law allows loan-capital to escalate into infinity. The penny
that was invested at interest at the time of the birth of Christ exists no
more, because since then all rights of ownership have had to give way to
violence several times; by contrast the penny that old Rothschild invested at
interest still exists, and will exist, if there is international law, for all eternity.
In addition it ought to be considered that broad
stretches of the Earth have only in the modern age gone over from natural
economy to money-economy. It is quite especially important in this connection
that only in the middle of the 19th century were all restrictions on charging interest,
and likewise all prohibitions on interest, abolished: thus England in the year
1854, Denmark 1856, Belgium 1865, Austria 1868.
Thus today's concept of interest as inseparable from
the possession of money is not much older than half a century. But precisely
this interest- concept has for the first time caused money to turn into the
demonic power of such universal coercion that we have come to know.
The incipient and then ever-increasing indebtedness of
states to capitalists likewise dates only to the middle of the 19th century.
Only since that time do we see the state degraded from being the trustee of the
folk-community into being the trustee of capitalistic interests. This
development has reached its highpoint in war-bonds, which we encounter in all
lands, which exclusively, as we have recognized, serve only Mammonistic
interests, which should be crowned with the gigantic credit-edifice of a world-
loan.
* * * * *
These brief retrospectives should make it easier for
us finally to break away from the supposition that unto loan- capital must be
lent the supramundane power to grow eternally and interminably from itself.
Gifted with a terrifying potential for sucking dry. We must break away from the
notion that loan-capital, unaffected by worldly deeds and misdeeds, should be
able to sit enthroned above the clouds, unaffected by transitoriness,
unaffected by the forces of destruction, unaffected by the shots of our giant
guns. For, should even houses and huts, railroads and bridges shattered by
shells sink into dust and ash, the mortgages will still exist; the railroad
bonds and public certificates of indebtedness are not thereby erased. Should
villages and cities, entire provinces fall victim to the insane destruction of
war, what is the result? New certificates of indebtedness are what it means.
With eyes flashing greed the Gold International enthroned above the clouds
watches the mad rush of humanity. And not long distant is the time when all
humanity finally shall serve only as interest-slaves to Mammonism.
The idea is international; it must liberate the entire
world. Hail to the nation that first dares the bold step. Soon others will
follow.
The question often directed to me, whether the idea is
nationally realizable at all, I answer with yes. We are internally
indebted.
Against foreign interest-claims we are naturally
powerless for now; these must simply be paid. Excessive capital- outflow must
be blocked to the extent possible, but, as little as the lawgiver refrains from
working out laws against murder, manslaughter, fraud, etc., because
there would still always be scoundrels, just as little should a people in its
totality restrain itself from taking a step recognized as necessary for the
healing of its public finances, just because of the fact that not exactly the
best elements of the folk are trying to carry their loot into safety outside
the country. If we assume that hundreds of millions, even billions in war-bond
certificates would be spent abroad; even this could still not be a significant
impetus for failing to abolish interest- slavery; for proportionally, of the
more than 250 billion marks in fixed-interest domestic investment-assets, by
far the majority must still be in the country.
Let us again summarize briefly. – The abolition of
enslavement to interest is the radical means for the final and permanent
healing of our public finances. – The abolition of the interest- community
means the possibility of renouncing oppressive direct and indirect taxes,
because the state-owned businesses, especially after the socialization of
further suitable sectors (inland navigation, electricity, air- traffic, etc.),
will give sufficient surpluses to the public coffers to support all social and
cultural tasks of the state.
Aside from this financial consideration, the abolition
of the interest-community will grant to productive labor in all fields of
endeavor the priority that it deserves. Money is returned once again to the
role appropriate to it, to be a servant in the powerful drive of our national
economy. It will become again what it is, a voucher for completed labor, and
therewith the path is cleared for a higher goal, for abstention from the raging
money-lust of our age.
The idea points toward the establishment of a united
front of the entire working population: from the unpropertied laborer who, as
we have seen, is very heavily burdened with indirect taxes for the satisfaction
of loan-capital, through the entire bourgeois class of civil servants and
employees, of the farming and small-trades middle class, which get to feel the
pitiless tyranny of money in the form of wretched housing, farmland- rental,
bank-interest, and so on, all the way up to the leading heads, inventors, and
directors of our big industry, who are one and all more or less stuck together
in the claws of big loan-capital, for whom the first task of life is always to
work for the sake of pensions, dividends, and interest for the money- powers
playing behind the scenes. No less do all circles of the intelligentsia –
artists, writers, actors, scholars, as well as other independent professionals
– also belong to this group.
Although big loan-capital, as a group of natural
persons or as the personification of the interest-principle, seeks consciously
or instinctively to conceal the fact of its boundless lust for control, and
although our entire legal tradition based upon Roman law, thus upon law serving
for the protection of a plutocracy, has ever so strongly emphasized the
protection of property and therewith permeated our people's sense of justice, the
abolition of enslavement to interest on money must come, as the only way out of
the threatening economic enslavement of the entire world by the Gold
International, as one of the ways to drive out the poison of Mammonism with its
corruption and contamination of the mentality of our age.
The Conversion of War-Bonds into Bank-Credit The
demand in § 1, for the conversion of war-bond certificates etc. into
legal tender, has on numerous occasions been met with the objection that it
would mean excessively flooding the market with currency. This objection is in
itself quite erroneous. Inflation occurs through the mere existence of war-bond.
It is however true that, in spite of its
wrongheadedness, the concern about the physical presence of these papers
declared to be currency is not going away, and therefore despite being
unrealistic this concern might generate unfortunate side-effects, as if in fact
a new inflation had taken place. Therefore, amending § 1, we demand, after
legislative cancellation of the obligation to pay interest, conversion of
war-bond certificates, along with other public debenture-bonds, [not into
currency but] into bank-credit.
This formulation has the great advantage that the
physical existence of war-bonds as paper would cease; the war-bond certificates
would be delivered to the Reichsbank by banks, bankers, thrift- institutions, etc.,
and would be destroyed after a credit-note for the face-value is issued.
Therewith nearly every person in Germany would receive a bank-credit, an open
bank-account that he could use.
Such a procedure would also have the great advantage
that the retention of larger investments in private possession would not be
possible, since after the expiration of a specified deadline the undelivered
certificates would be declared void.
Furthermore it would at least be possible to control
how much war-bond is spent outside the country [thus affecting Germany’s
trade-balance]. The last point however must not in any way block fulfillment of
the abolition of enslavement to interest. Since we really feel too weak
compared to foreign countries, we must satisfy (only) the interest-demands that
confront us from abroad. Personally I am entirely of the opinion that we should
also uphold the cancellation of interest even for foreign bondholders. We need
not fear that foreign interest-claims would be enforced by force of arms, since
there has been so much progress in returning [from war-madness] to something
resembling self-awareness, and never yet in history has a warlike action been
undertaken against a great state because of financial measures affecting
private persons. It also ought not to be imagined that even the French people
would issue an ultimatum to Germany because of the interest-claims of Messrs.
Mayer, Schulze, and Cohn from Germany, based on their German war-bonds carried
across the border.
Beyond this it would be possible, so as to avoid even
the appearance to the rest of the world of a state bankruptcy, to conduct a
lottery of the war-bond, which then of course could easily be rigged based on
statistics obtained through the required delivery of certificates, so that at
first just the numbers presumably belonging to people abroad would be drawn and
paid off in Reich banknotes.
Yet a third thing would be the welcome ascertainment
of the distribution of war- bonds, and the accompanying opportunity that still
exists for an extraordinarily simple collection of the wealth-tax, while the
bursaries of course would need only to instruct the Reichsbank offices to
charge the account of Mr. N.N. with so and so many marks in tax. In this manner
tax-payments would be more painless by far -- although of course the taxpayers’
right of appeal would continue to exist in its full extent.
With such a transformation (conversion) of war-bonds
into bank-credits a certain social leveling could also be accomplished, insofar
as smaller investments in war-bonds, thus all small subscriptions of all of
those for whom the subscription of war-bonds really is to be accounted a
patriotic deed; let us say up to 5 or 10 thousand marks, would be made good at
par, while all larger subscriptions could be credited at a rate to be
established. The credits for all other government paper would be handled precisely
the same.
Special Comments on the Demand for Law in the
Manifesto On § 1 It is completely indispensable that all state and municipal
debt-subscriptions be treated in the same way, since only such a unitary
large-scale regulation of our entire monetary system, hand in hand with the
abolition of interest-slavery, can be implemented.
On § 2 It is already clear that the abolition of
interest-slavery must be applied simultaneously to all the other fixed-interest
papers, so as not to cause an absurd boom in these papers, which obviously
would occur if the public papers alone were declared interest-free. The
reduction of the debt as such would be accomplished through annual repayment,
whereby a constant and consistent un-debting of all debt- laden objects would
be accomplished.
On § 3 This paragraph is very closely related to the
preceding ones, as well as with the demand for nationalization of mortgage-
lending in § 5. The farmer or homeowner burdened with mortgages continues,
after as before, to pay the amount that he had to pay to his creditors, but no
longer as eternal interest, rather as repayment. Thus after 20, 25, or 30
years, depending on the preexisting interest- rate, ownership of land and home
will be freed from debt. (The mortgage-bank for its part can naturally likewise
only during this time continue correspondingly to pay interest on covered bonds
to covered-bond- holders.) Hand in hand with this liberation from debt arises
the community's right of ownership in the real-estate freed from mortgages.
A universal registry of dwellings, or rather a
real-estate cadaster, would have to come first; because debt-free real- estate
ownership naturally also has the right to repayment of invested capital, and
also a permanent claim on a portion of the rent, to pay all the charges,
expenses, and so on that come with real- estate-ownership, as well as
appropriate compensation for work that the owner himself does. [* The
connection between the registry of dwellings and the rights of debt-free owners
is puzzling, unless the idea is to manage the growth of rental property so as
to keep it reasonably profitable.] Let us consider this in broad outlines with
the example of an urban apartment- house. The house has a value of 100,000 marks.
Against that is recorded a mortgage-bank's investment of 50,000 marks at 4% in
position 1, a noncorporate investment of 20,000 marks at 5% in position 2, and
30,000 marks is the amount put up by the house- owner himself. The revenues
from rent are 7000 marks. From this must be paid 2000 marks for the first
mortgage, 1000 marks for the second mortgage, and 1000 marks for expenses,
outlays, and so on: in all 4000 marks. Thus 3000 marks remain to the
house-proprietor as an interest-payment [so to speak] for his own invested
capital of 30,000 marks.
Following implementation of the legal abolition of
interest on money the situation after ten years is as follows: 1s t mortgage
30,000 marks, 2nd mortgage 10,000 marks. The house-owner has completely
recovered his capital- investment, but on the other hand there is a new, public
right of ownership in the amount of 50,000 marks. With that the right of the
state to have a say about further income from rent and to determine the amount
of rent begins. [* Feder does not state how he derives the figure of 50,000
marks: it is half the value of the apartment-house, but also equal to the
amount of the corporate mortgage. Probably the most important fact is that it
is not more than the amount owed in mortgages, and therefore causes no pain to
the house-owner. Presumably, given the emphasis that Feder puts on painless
transition, if the amount owed on the house were less than half the value, the
state according Feder’s plan would still not claim a share of ownership greater
than what is owed on mortgages.] It would be unjust now, in regard to
repayment, to put the house-proprietor on the same level as mortgages. For his
capital is not pure loan-capital in the narrower sense that should be affected
by the abolition of interest-slavery; here we are talking about “risk” capital,
specifically about money converted into a valuable good, specifically a house.
It is therefore up to the owner of the house whether to grant a longer duration
of payments, or a corresponding percentage permanently included in the
operating expenses of the house.
It cannot be the purpose here to make any binding
proposals; here only suggestions are being made as to how a frictionless
transition of the interest- economy into the interest-free economy could occur
even in the area of real- estate.
So as to complete the example, let the status after 25
years be presumed as follows: by that time all mortgages are paid off; only the
permanent expenses are the same or, because of the greater age of the house,
increased from 1000 marks to perhaps 1500 marks. Let the return afforded to the
house-proprietor from this sum also be about 1000 to 1500 marks; thus
accordingly it appears that around 3000 marks of the rent- revenues go to cover
non-negotiable charges, while the remaining 4000 of the original 7000 in
rent-revenues would be freely disposable. The state thus has the possibility of
lowering the rents by more than half; it will do this e.g. in workers'
dwellings, or the state may cut rents by only 20, 30, or 40%, and thus gain
from the difference an enormous source of revenue for other public necessities,
above all naturally for publicly conducted home-construction. For mansions the
rents are not lowered, or not lowered much, whence very great additional means
become available also for the better construction of homes, or for special
social purposes. This future state of affairs however reveals – and I hold this
for a very fruitful prospect – the inner justification for the community
(state) even now to take part in determining the amount of rent in the manner
that I sketched above, with a lowering of rent for workers' dwellings.
In the growing right of the state to participate in
real-estate-ownership also lies the foundation for a sound bank of issue, and
issue of credit to mortgage- creditors.
On § 4 and 5 These paragraphs demand the socialization
of the entire monetary system. Money is only and exclusively a voucher for
completed labor issued by a community that has its own state. To issue
money-tokens is one of the sovereign fundamental rights of the state. The
counterfeiting of the state's money- tokens is subject to the most severe
punishments; thus it is a quite forceful social demand that the monetary
system be placed under the control of the collectivity. The work-power
of the collectivity is the sole substrate of money-tokens, and only the failure
to appreciate this fundamental fact has led in general to the deterioration of
our public finances and to complete anarchy of the monetary system in general.
With the surrender of personal and commercial credit
by private bankers, proposed in § 5, a deeper incision is made into the total
credit-system. For the state credit-system, as well as for municipal and even
real-estate credit, one must cleave to the abolition of interest-slavery with
utmost rigor and energy, because it is the indispensable prerequisite for the
social state in general.
The situation is different with personal credit. We
also demand, in and for itself, the interestlessness of personal credit; yet
this demand does not carry the same enormous and principal importance. We
remember the 250 billion in fixed- interest loan-capital compared to the only
12 billion in dividend-paying stocks.
All such credits, stocks, participation- certificates,
mining shares, equity- holdings, and so on, are risk capital. The yield of this
capital depends on the industry and efficiency of those persons to whom the
money was entrusted. Here the element of risk and danger of loss thus comes
into play, along with the question of personal trust. For that, a certain
compensation of a special kind still appears indispensable. The owner of stocks
and so on is in no way compensated or benefited if the enterprise to which he
entrusted his money earns nothing. He loses his money entirely if the enterprise
collapses.
It is otherwise with, for example, the owner of
debenture-bonds of the Reicheisenbahn. The Reich's railroads [in
Elsaß-Lothringen] are completely lost with the loss of Elsaß-Lothringen.
Nonetheless the holder of railroad- bonds continues to receive his interest-
payments. From whom? From the taxes of the collectivity. The railroads may work
with a deficit balance of any magnitude as in Prussia and Bavaria in the last
year; yet the bondholders receive their interest-payments just the same. From
whom? From tribute paid out of the work-potential and consumption of the
working population.
One would just like to make this fundamental
distinction perfectly clear, in order finally to recognize where it is that the
vampire sucks from the work- potential of the people.
Thus personal credit should remain, or rather be
allocated again, to personal dealing through the private bank. The personal
efficiency of the credit-seeker, with which the banker is personally familiar,
should again become the determining factor for personal credit. The fees set by
the state will regulate themselves by themselves, in accord with the fluidity
of money that will in any case commence with the abolition of interest-slavery.
On § 6 The main point of § 5 is also valid for dividend-assets
in particular. In the interest of the social state-community it must be
demanded that a repayment of the capital once lent be attempted also for the
great industrial enterprises – in order to bring about here too a reduction of
the indebtedness of the individual industrial works toward those that are only
investors.
For in fact what we were able to observe in the
relationship of loan- capital toward all peoples repeats itself here on a
smaller scale. Here too the capitalist exploits the worker, the foreman, the
engineer, the entrepreneur, all equally, because the compulsion to have to earn
dividends takes priority. [* This is a problem of joint-stock companies.
Companies owned free and clear by families, as is common in Germany, do not have
this characteristic.] If however we attain the liberation of industries and
businesses from the eternal interest-sucker, then the way is clear for the
lowering of prices of products, and for the delivery and distribution of
surplus value, partly to the community, partly to the laborers, middle
management, and boards of directors of the particular enterprises, thus to
those that really alone create manufacturing and values.
On § 7 In this paragraph naturally the entire field of
insurance also comes into play, which can be constructed on an analogous
interest-free basis. The premiums paid cannot grow through addition of
interest; rather the insurance- companies will become thrift- institutions; in
other words the risk and advantage of insurance are retained. For this the
political community has to be responsible.
On § 8 With regard to the devaluation of our money,
which has resulted only through the enormous mass of our innumerable
certificates of indebtedness, we demand a strongly graduated wealth-tax. We lay
the emphasis in this on “strongly graduated.” A [flat] wealth-tax [for the
purpose of] reduction of the number of notes and so forth would be nothing but
a self- deception whereby one throws sand into the eyes of the people. For if I
also confiscate half of all of the wealth everywhere and receive payment in
bonds and pulp these, all that is really accomplished thereby is a diminution
of the amount of paper, while in return a conversion-factor will increase the
fictive value of the totality of circulating paper to the same level as before.
Real value belongs always only to goods for consumption and goods for use,
never to the paper vouchers for completed labor.
Another question is whether the foreign exchange-rate
of our mark-currency can be improved. But even this improvement of the
exchange-rate is again in the final analysis only dependent on work- potential
and production, in other words the possibility for production of our total
national economy.
The Objections and their Refutation Never yet has an
idea been able to establish itself without opposition, least of all an idea
that makes such a radical departure from the long-established assumptions about
the sanctity and inviolability of interest. With the objections already raised
and those expected there is always a two-fold observation to be made: it must
be asked, first, what part of the objections being made is based on deliberate
distortion of the idea of abolition of interest-slavery, and second, what ought
to be said in response to all sincere and fact-based misgivings? The most
frequent objection is the assertion: without the charging of interest nobody
will lend money.
We do not in fact want anyone to lend his money
anymore. Credit was the trick, was the trap, into which our economy entered,
and in which it is now helplessly ensnared.
If the folk really urgently needs greater capital,
then it gets the needed moneys interest-free at the central state treasury,
with only repayment required. Eventually it will issue new banknotes. Why
should it issue interest-bearing certificates?! Whether the paper bears
interest or not makes no difference! Its only and sole backing is the work-
potential and tax-potential of the folk. Why burden every public expenditure
from the beginning with the leaden weight of eternal interest? Yes, but how
should the state fulfill its cultural labors for the community? It still needs
money and can be fair in this task only by way of loans that charge interest.
This assertion is based on an entirely Mammonistic way
of thinking. It would have to be deliberately calculated for misdirection after
thorough reading of this Manifesto; for in the first place we have
proven that after the abolition of interest-slavery all cultural and social
tasks of the state can be covered out of state-owned businesses, out of the
revenues of the postal service, railroad, mines, forests, and so on, without
anything further. In the second place the sovereign people's state [Volksstaat]
has the power, at any time, to take care of special cultural tasks through the
issue of interest-free value-tokens in lieu of the interest-bearing
certificates declared to be the rule in the Mammonistic state.
It is thoroughly impossible to see why the state
should make special cultural tasks, e.g. railroad, canal, and hydroelectric
construction, more costly for itself with an eternal promise of interest that
is completely unnecessary. If it cannot pay the costs of construction from the
revenues of its current state- owned businesses, then there is no reason to see
why the state should not create the money; the sovereign people must indeed pay
for it, while it recognizes precisely this money as a means of payment. Why
however should the folk, with its entire work- and tax- potential, stand behind
another slip of paper (the interest-bearing loan), which imposes on the folk in
its totality only an eternal interest-obligation for the benefit of the
capitalist!? Therefore away with this obsession of the Mammonistic state! The
capitalists then will just take up the issued paper notes and accumulate paper
money.
This is refuted in two ways. First, the demand that
mere possession of money should be rendered unprofitable would then of course
be already fulfilled, and the abolition of interest-slavery voluntarily
undertaken by the capitalists themselves, since the capitalist renounces
interest of his own accord if he piles up his paper notes at home. Second, the
capitalist's fear for his money makes it unlikely; one need only imagine the
sleepless nights of the currency-hoarder who keeps great sums of money piled up
at home and must constantly see his possession threatened by thieves, robbers,
burglars, house- searches, fire, and flood. I am convinced that the upright
citizen would become tired of these worries in a short time, and would soon
find his way to the state bank. The state bank issues a receipt and is now
legally responsible for the account, but not for any interest- payments.
Otherwise of course a third possibility still remains open to everyone,
specifically to work with his money, to create values and to manufacture goods,
to participate in industrial undertakings, to render his life ever richer and
finer, to support art and scholarship, in short to make beneficial use of his
money while rejecting the Cult of Mammon.
It can however still happen that private need of
capital for some goals urgently presents itself, e.g. for testing of
inventions, founding of businesses by young, competent craftsmen or
businessmen, etc.
To begin with, this has nothing whatsoever to do with
the abolition of interest-slavery! For, in the first place, one must logically
assume that the capitalist, who after the abolition of interest-slavery of
course has no more opportunity to invest his moneys in a bombproof manner and
to expect idle consumption of interest, will rather, as in an earlier age, be
inclined to risk his money for such purposes, so that a lack or need in this
direction will therefore occur much less than hitherto. Or has one not heard on
the contrary again and again from the efficient businesspeople, from the
cleverest inventors, precisely the complaint of how difficult it is to get
money in the Mammonistic state for such purposes unless a “dividend” could be
guaranteed? In the second place, it must be the task of the coming state to
foster every competent force through generous support. There were indeed even
before now already beginnings toward this in the old bureaucratic state, but so
small- hearted that, instead of a stimulus, an inhibition and reluctance
resulted, because of the harassing regulations that accompanied the granting of
public support. In the third place let it be noted that with the allocation of
several million marks, enormously much could be achieved. The joy of labor, the
industriousness and tenacity of the German inventor, engineer, craftsman, etc.
is so great that, through the state's right of participation in the results
of fortunate inventions, the expenditures most likely would be richly rewarded
(England as an example).
The abolition of interest-slavery leads necessarily to
the exhaustion of wealth.
Oho! Who claims that? But of course! Whoever has
adapted his life to the consumption of his interest-payments on capital and
cannot resolve to work, with him it is certainly true: consuming 5% annually he
will have completely exhausted his wealth in 20 years. Of course, but that is
indeed completely in order! What we want is precisely the abolition of
interest-slavery; we want living on a pension to cease being the citizen’s
highest ideal. We want to end this Mammonistic decadence; indeed we want no
longer to tolerate that one, that many, can live in comfort permanently only
from interest-payments on loans -- in other words at the expense of others!
I repeat: it is also not true at all that the abolition of the lordship of
interest would lead to the elimination and exhaustion of wealth. On the
contrary, the abolition of interest-slavery would promote the creation of
wealth based on labor that manufactures goods and produces value, unburdened
and liberated from eternal interest-outlays. The abolition of interest-slavery
leads, as we have seen, to a comprehensive lowering of costs in all of life; it
unburdens us from the excessive weight of taxation so that for every working
man the possibility of accumulating savings must be greater in the future than hitherto.
One more thing! The goods- and values-producing national-economic labor of
industry, commerce, and trade is in no way hindered, but fostered to the utmost
through the abolition of interest- slavery.
What does the worker get if capitalists receive no
more interest-payments? This
question really ought not to be coming up anymore! In the first place, of
course it was the constant battlecry of labor that the capitalists would
exploit the workers; in the second place we have indeed clearly and plainly
seen that it is the laborer more than anyone else that is required to pay the
interest on loans. [In other words, what the worker gets is lower taxes and a
lower cost of living.] The bonds of family are weakened and damaged if one
can leave no wealth behind for the children.
Yes what is the reality here? Quite generally I think
that money has little or nothing to do with the sense of family. Or has one
heard that the children of wealthier parents cleave to their parents more than
those of poor parents? Or do rich parents love their children more than the
less propertied? What is likely to be more important for the children, that
their parents arrange for them the best possible upbringing and have them learn
some discipline, raising them into industrious and healthy and courageous
people, or that they leave behind for them the biggest possible moneybag? In
particular cases a justified striving to secure the children’s financial future
undoubtedly will have to be acknowledged. This striving, and thus the
thriftiness of the parents for their children, will be in no way adversely
affected by the abolition of interest- slavery; on the contrary. The
possibility of saving will become greater, when our national economy will be
liberated from the all-encompassing pressure of interest-slavery.
We have seen from the example of the man with earnings
of 10,000 marks and pension-income of 5000 marks that all medium-sized and
smaller fortunes are in fact robbed of any beneficial effect by the circuitous
route of the direct and indirect taxes of housing-rent and so on.
I cannot repeat often enough: interest on bonds for
possessors of small and medium amounts of wealth is a swindle, a
self-deception, a running around in circles, but big capital through its
devoted press has quite diabolically propagated and proclaimed in all the world
the faith in the sanctity and inviolability of interest. It allows everyone
seemingly to take part in the lovely, anaesthetizing consumption of interest,
in order to lull to sleep the bad conscience that must invariably accompany
idle, laborless consumption of interest – and in order to recruit comrades for
the struggle, for the defense of this highest good of Mammonism.
The civil servant, the statesman, will say: the state
cannot renounce the obligation that it has undertaken toward its creditors.
What does “obligations” mean? Is it in any way moral
to enter into obligations about which the state must know from the beginning
that it can only fulfill these obligations if it takes the interest away from
the creditors through direct and indirect taxes in precisely the same amount?
Where is the morality in that? Or is it not perhaps more honest to admit: “I
can only pay the interest if I collect just as much in taxes – but back during
the war I absolutely had to have money, and for that I did the swindle with the
war-bond; you have to forgive me, beloved folk; it was ultimately for you, and
now we want to play no more hide-and-seek; I the state am paying no interest
and you, the taxpayer, need not pay taxes for the interest; that will
substantially simplify our transactions. Thus we shall do without the enormous
tax-bureaucracy and likewise the extraordinary interest-serving bureaucracy.
Right? Do we have a deal?” And you, Herr Scheidemann, do not again post your
name on every advertising pillar as the secretary of state of the old
compromised government amid foolish declarations relating to the security and
inviolability of the war-bond. You only embarrass yourself: the benefit of the
entire swindle has indeed gone only and solely to big loan-capital.
Financial officials and banking professionals are
declaring that the abolition of enslavement to interest on war-bonds and public
debts is impossible because it is synonymous with public bankruptcy.
You will forgive me: according to your speeches we are
indeed publicly bankrupt anyway, or must become so. An overt declaration of
public bankruptcy however would be the greatest stupidity that we could commit:
to the actual incompetence of the current power- holders it would add
prematurely the historical confirmation of this incompetence.
Why declare bankruptcy? If I have put 3 marks from the
right pants-pocket into the left, I must still not on that account declare the
bankruptcy of the right pants- pocket! It was indeed no different with the war-
loan! The Reich took out of the people's pockets the first actually present
billions, then the moneys flowed back again; then came the new loan and again
the money streamed back; once again came the pump and sucked the billions and
again they ebbed back, until, after the game had been repeated nine times, the
state had merrily generated 100 billion in debt. For that the people had 100
billion in finely printed paper in their hands. At first the folk imagined that
it had become so much richer; then came the state and said: “It is horrible; I
have 100 billion in debt and face bankruptcy.” – Yes but why? That is in any
case only a self-deception! I myself can indeed never become bankrupt if every
so often I take my money from the one pocket and place it in the other.
Therefore we can rest at ease about state bankruptcy in regard to our internal
war- bond debts. Therefore we really need not declare public bankruptcy and we
can really spare ourselves the gigantic labor with the stupid interest-payments
and the big, but even stupider, taxes.
Let us indeed finally free ourselves from doing the
bidding of big loan-capital! Only big loan-capital benefits from this
loan-interest tax-swindle, since a lovelier lump of gold is left over for it
and the laboring folk pays this surplus in the form of indirect taxes;
meanwhile, however, the small and middle-sized capitalist simply chases his own
tail.
The global economic official says: The abolition of
interest-slavery is not possible for us to accomplish in Germany alone; it must
be done internationally; otherwise we shall lose all credit, capital will flow
away, and we will still have to fulfill our interest- obligations toward the rest
of the world.
I confess that I myself was at a loss about this
question for the longest time.
It is the most difficult question because it involves
our relationship with the rest of the world; meanwhile the matter has two
sides. On the one hand, the idea of the abolition of interest-slavery is the
battlecry of all productive peoples, against international enslavement to
interest on money; on the other hand it is the radical cure for our internal
financial woe. But it is really no reason to refrain from using a cure, just
because the equally sick neighbor does not employ it at the same time. It would
however be added stupidity if we in Germany continued to run in a crazy circle
and pay taxes and interest when we have clearly recognized that this ridiculous
activity benefits only the big capitalists and nobody else. Therefore let us
lead the way by our liberating example; let us liberate ourselves from the
enslavement to interest on money, and we shall soon see that the force of this
victorious liberating idea will stimulate the peoples of the world to follow us.
I am actually convinced that our initiative – if this
initiative is not suppressed by the German Mammonists – will sweep the other
peoples along with irresistible necessity.
The Spartacist says: The whole idea only amounts to a
protection of capital; it still remains then as it was: the poor man has
nothing and the rich remain.
Yes, my friend; it is in general very hard to have a
discussion with you -- if you really are in the depths of your soul a
Communist, and will therefore actually maintain that “all things belongs to all
men” [* Peter Kropotkin, The Conquest of Bread], and if along with that
you are indeed familiar with the actual ideas of the great Bolshevik leaders in
Russia, especially Lenin, and regard them as correct, and accordingly regard
the next tasks of the Soviet Republic designated by Lenin, “universal tendering
of accounts and control of all production and distribution,” as humanly
possible.
If however you are completely clear about the fact
that this task is really only feasible, if at all, under a horrible tyranny,
and you still remain at the bottom of your heart a convinced Communist or
Spartacist and so on, then let us not dispute further with each other; we just
do not understand each other and are speaking different languages, and the
future will decide, either for the strait- jacket state that can ultimately
result from the chaos of Bolshevism, or the new state for which I hope, with a
national economy liberated from interest-slavery.
But if, at the bottom of your Communist heart-- if you
are honest -- you find that you still think about, still long for wife and
child, for a human soul that stands closer to you than an Eskimo or a Zulu
kaffir, if during factory-labor commanded by the soviet-director you think that
it would still be nice to possess your own little cottage, a little
garden-plot, if indeed in the very depth of your soul it would really give no
true satisfaction that you should be entitled like a dog on the street to use
every bitch that crosses your path, if you want to call somebody your wife, if
you merely think about saving something from your wage, which then should
belong to you alone, then you are already no longer a Communist; then you have
already in your heart broken from your so loudly proclaimed catchphrase, “All
things belong to all men”; then precisely what you do not want is that all
things should belong to all men; you want that precisely what you wish for
yourself -- wife, child, house, farm, savings -- whether you already have it or
only hope to get it, even then should belong to you alone.
And do you see, my friend, if you only suspect in your
heart that it might make a difference to you, if some random individual came
and simply took your savings away from you in the name of “all,” and if he
brought another child for you and took with him yours because all children
belonged to “all,” then my friend, let us not continue to speak completely past
each other.
Perhaps I could ask you to contemplate whether in fact
the Communist message that all things should belong to all men would not
necessarily mean the end of every culture, because the lack of any
concept of ownership must with compelling logic force man down to the level of
the beast.
If all things belong to all men, if a tendering of
accounts and control of all above-ground production and distribution in Lenin's
sense could be coerced, then in the best-case scenario an ant-colony would
result. But in that case we can also do without language, soul, and thought;
mutely and instinctively we can perform our forced labor. The end of man is
there. [* “The End of Man” is from Ezekiel. There it means the
purpose of man but here it could have a double meaning. Man’s purpose under
Communism becomes mindless slavery, which is the destruction of man.] But
enough now, friend Spartacus. Let this fundamental consideration sink deeply
into your head and heart. A more exact answer to your question will then result
during conversation with the other parties.
And now, you comrades of the two socialist
orientations, moderate and independent! [* Feder refers here to the Social-Democratic Party
and its pacifist offshoot, the Independent Social- Democratic Party.] I cannot
imagine that serious contradiction or objections against the abolition of
interest-slavery would come from your side, and yet I must deal with you
categorically, along with the entire socialist world of ideas, from Marx up to
the current leaders Ebert, Scheidemann, Kautsky, and so forth.
1. The socialist will: elevation of the working
class is an idea unconditionally bound to prevail; so far we are in
agreement.
2. The paths trodden for the attainment of this great
goal are almost entirely wrong, because they 3. are based on false assumptions.
4. The [Marxist] socialist idea of the state leads
necessarily to Communism, thus to decline.
5. Because however Social- Democracy has a different
goal, the elevation of the working class, of all working people in general, it
faces a terrible inner conflict, because the logical consequences of Marxism
lead to the direct opposite of the practical goal of the workers' movement.
6. From this inner division results the overt
uncertainty in the direction of the government.
7. For the sake of the great practical goal (elevation
of the working class) a sharper line must be drawn against Spartacus and
Bolshevistic Communism, and their methods must be combated with all our might.
But Social- Democracy, organized through labor-unions, feels weak today before
these radical groups, because it has taken up Marxist thinking as its
fundamental principle of education, and because all Marxist ways of thinking
logically lead to Communism.
Now the proof: point 2 says that the paths trodden by
Social-Democracy are almost entirely wrong.
The whole agitation conducted throughout the country
has led to a deep division within the population of our nation. The constantly
repeated slanders against employers of every kind, indeed of every bourgeois
calling whatsoever, as exploiters and bloodsuckers of the manual laborer
working ostensibly unassisted, have led to an unjustified embitterment and to
the haughtiness of labor, which today necessarily finds its expression in the
demand for the “dictatorship of the proletariat” (Communist Manifesto).
The essential demand of the Erfurt Program – the transfer of the means
of production from private ownership into the ownership and operation of the
community – has today been compressed into the cry for “socialization.” It is
completely clear to every serious politician that full socialization of our
economic ruin would mean complete state bankruptcy. But one dare not confess
this openly and freely to the people.
Not socialization but desocialization would
have to be the motto now. Thus one attempts to compensate the blatant
miscarriage of every socialization through delusional tax-projects and by this
route to “expropriate the expropriators” for the second time. All of that means
nothing other than abandoning the entire national economy to utter ruin.
Instead of growth (a doubling of production, as the entire socialist literature
for the period after the revolution promised, is out of the question) the exact
opposite has occurred.
The worst thing however would be if the current
socialist government thought of accepting big foreign loans. With that not only
would our economic decline be sealed, but we would furthermore quite entirely
deliver ourselves into interest-slavery to the Entente, from which there would
be no return.
The fundamental failure, the basic error, upon which
this whole wrong chain of treaties, demands, and promises to the people has
been constructed, is an entirely wrong attitude toward industrial capital and
loan-capital. The Communist Manifesto, the Erfurt Program,
Marx, Engels, Lasalle, Kautsky, have not recognized the radical difference between
industrial capital and loan- capital.
On this point the entire Social- Democracy must
relearn; this fundamental error must be clearly recognized and frankly admitted
without reservation. Then however one must also relentlessly draw the only
possible conclusions. These however signify radical renunciation of the
pointless, because completely mistaken, rage against industry, against the
employer. Worker and work-giver belong together; they have the same goal
-- work, production; for without production, without work, there can be no
life, no culture, no forward, and no upward. The self-evident and unavoidable
oppositions that exist among humans, just because they are humans, are much
less important than the great shared interest of employer and employee. These
oppositions are and have been resolvable by means of wage- contracts and
trade-organizations to the mutual satisfaction of both sides.
But let us not pursue further these questions that are
trivial in the scope of our treatise on the largest political lines of force,
and let us only emphasize that the interest of labor collectively is perfectly
aligned with our national industry, with the national economy of our people.
Whoever teaches otherwise and presents the oppositions
between employer and employees as more important reveals himself as
irresponsible precisely in regard to the workers; for he thereby lays the axe
to the roots of the tree that nourishes and supports the worker.
Social-Democracy however has done that, and
with that it has incurred eternal guilt before German labor; with that it has
brought unspeakable misery upon our folk, because it cannot keep all its
promises, because it cannot bring to us the peace of mutual understanding,
because it cannot create work for us, because it must even set up an armed
force against us, because it cannot get by without the civil service, because
it must demand the obligation to work, because universal equal and direct
suffrage for men and women over the age of 20 helps nobody to earn a living,
because without the state's guarantee of the security of person and property
chaotic circumstances must occur, because without integration and subordination
of the individual into society no vitality of the state is possible.
Thus a deep, despair-filled wave of disappointment
passes through the entire people. If individuals still do not understand it,
ministers, members of parliament, and people's delegates continue cheerfully
lying to each other that the “gains of the revolution” must be defended against
“reaction”: what these two terms mean, if anything, no sincere statesman would
be able to tell the people clearly.
The negative actions of the revolution, the deposing
of a series of antiquated dynasties, deposing of officers, abolition
of the nobility, dissolution of the army, in short the “Great
Demolition,” is indeed no “gain.” And reaction?! The swept-away, rotten
doctrine of divine right does not have anywhere in the entire folk enough moral
support to result in any forceful action; the bourgeoisie, as regards the real bourgeois,
is much too cowardly, much too morally corrupt, to rally against class-conscious
labor: therefore it is not necessary for the ruling class of the workers to be
worried about a dynastic or bourgeois reaction.
But the deep disappointment of the people about the
so-called gains of the revolution, in other words about the lack of any real
improvement of the people's situation, that is the great danger. This disappointment
leads to the streaming away of great masses ever farther to the left, where the
promises already made are outbid by far.
Ultimately one can no longer make promises such as
“all things to all men.” That is pure madness, but every idea, every phenomenon,
every activity stretched and exaggerated to the extreme becomes madness in the
end, and then changes into its opposite. So goes it likewise with the Communist
idea that all should belong to all, for this ultimately comes to an end and
resolves into all ... having nothing. Hunger, despair, misery, sickness, and
need have arrived in Russia; people have lost the last remnant of courage and
joy in living.
I repeat: the enormous fundamental error in the
socialist idea-world is ultimately to be traced back to the failure to
recognize the deep essential difference between industrial capital and loan-
capital. Interest-devouring loan-capital is the scourge of humanity. It
is the eternal effortless and endless growth of big loan-capital, not
productive, goods- manufacturing, industrial working- capital, that leads to
the exploitation of peoples.
I cannot forgo here the examination of the question of
why this essential difference has not been recognized; whether it really
has not been recognized, or whether it perhaps has been obscured for the
benefit of big loan-capital; whether the leaders and chiefs in the struggle
against Capitalism, whether the authors of the Communist Manifesto, of
the Erfurt Program, and the current leaders always have proceeded with the
necessary conscientiousness.
It is the most grave and terrible thing when one casts
doubt on the absolute earnestness and firm conviction of another; it seems all
the more grave, the more carefully one seeks after the causes and relationships
pertaining to life’s occurrences. I want therefore also to give no answer at
all to this question itself, rather only to allude to big, obscure connections
by citing an utterance of Disraeli, the greatest English Prime Minister, Lord
Beaconsfield. This he writes in his novel Endymion: "No man will
treat with indifference the principle of race. It is the key of history, and
why history is often so confused is that it has been written by men who were
ignorant of this principle and all the knowledge it involves." [Baron
Sergius to Endymion] The bourgeois.
The bourgeois, to whom rest appears as his bourgeois
duty, is certainly disturbed by every new revolutionary demand, as always with
every new idea. It means unrest for him; for perhaps he would even have to
think something about it.
All change is odious to him; he wants to have his
rest, and woe unto him that covets his moneybag. Now indeed one does want from
him his interest- payments, his income from rent on houses, the
interest-payments from his covered bonds, the interest that he collects on
mortgages; in short, what constitutes his rest, his contentment, and his good
fortune.
Even so, we must inquire what the members of the
classes owning loan- capital will have to say. They form, apart from the true
bourgeois…. Bourgeois is a human type, with which nothing further is to be
initiated; the bourgeois is a branch on the tree of humanity that should be
lopped off, the sooner the better. These are the smug, self-satisfied Babbitts
with their deplorably narrow horizons, who are capable of no enthusiasm. They
while away their days in eternal monotony with coffee, morning newspaper,
morning drink, noon paper, lunch, afternoon nap, coupon-clipping, afternoon
drink, friends at the pub, and occasionally the movie-house. Lacking comprehension
for all that moves the world, all for which youth longs, all that distresses
the folk, the state, and society, untroubled about war and victory, they
vegetate and decay, simultaneously arrogant and obsequious – but the
bourgeoisie is such a broad class that it cannot be ignored.
Thus, through the abolition of interest- slavery,
thrift is destroyed; people end up in the poorhouse.
That the abolition of interest-slavery quite generally
may have its influence on thrift must be decisively denied. Thrift has just as
little to do with the prevailing economic views as e.g. wastefulness.
Thrift and wastefulness are human qualities that either are present or not,
indifferent to whether an age approves or frowns upon the idea of interest.
In times of transition perhaps an increase or
diminution of thrift can be promoted. In the given case however I tend much
more to the view that a rational, economically minded person will say to
himself the following: “I can no longer in the future count on living on my
interest alone. I want however to live in later years and also still leave
something behind for my children; therefore I must now save more.” The
abolition of interest-slavery must, in my opinion, exert this effect on the
majority of people. As for the elderly, of course they will be referred to
public support.
Here too I must once again stress emphatically
that, given the current burden of direct taxes on property and the burden of
indirect taxes on every lifestyle, nothing of the lovely interest- payments
remains, except in the case of that person for whom – and it is indeed something
iniquitous and to be combated – all income flows only from eternal
interest-payments. Therefore a decline in thrift is probably not to be feared.
Is (loathsome) big capital really so utterly unfruitful? Has it not also created the
means to large-scale progress that bears fruits for humanity greater than what
the interest on loan- capital destroys? No! The posing of the question only
proves that Mammonistic phraseology has clouded our clear vision.
Big capital has not created the means to large-scale
progress; rather big capital has grown from labor! All capital is accumulated
labor. Big capital is in itself unproductive, because plain money by itself is
a thoroughly unfruitful thing. From mind, labor, and available or already
developed raw materials or mineral resources, values are produced and goods are
manufactured – through labor and only through labor.
For if one pours so much money onto the most fertile farmland,
into the richest coalmine, the farmland does not on that account bear grain,
nor the coalmine spit out coals by itself! Let us conclusively affirm this.
If people have invented money, it is accordingly quite
useful and reasonable; for in every complex economy one needs this (universally
recognized) “voucher for completed labor.” But that a potential should inhere
in these “money- empires” to grow eternally from themselves into enormity – and
money does that, if it can bear interest – it is that against which the core of
our being rebels; it is that which exalts money far above all other earthly
manifestations; it is that which makes money into an idol. And all of that is
indeed only the most enormous self-deception of humanity! Nothing, nothing at
all, can come from money alone. Table, cabinet, clothing, house, tool, in short
everything around us has some value; in the end one can still use a broken
piece of furniture as firewood to warm oneself, but with a twenty-mark note one
cannot do anything; I cannot even wrap a piece of cheese in it. Only after
people have sensibly agreed on the facilitation of the exchange of goods for
consumption, to write vouchers for completed labor, only with that does the
slip of paper receive meaning and purpose, and it is very reasonable that the
farmer for his grain receives from the coalmining company not coal but money;
thus a voucher for other completed labor, e.g. pitchforks, crockery,
plough, and scythe. But with that the power of money should end.
Thus the large-scale progress of humanity has been
made not by money but by the men themselves, their bold spirit, their proud
daring, their clever mind, the strength of their hands, their shared,
therefore social, industrious labor. So proudly and so clearly must we see.
The men were the thing, certainly not the pitiful pieces of paper that men
invented for the simplification of commerce.
Further Program Although the abolition of interest-
slavery is not the final goal of the new statecraft; it is truly the most incisive
deed, the only deed that is able to unite all peoples into a true league of
nations, against the tyranny of Mammonism that encompasses all peoples. But it
is not the end. On the contrary, the abolition of interest-slavery must lead to
further steps, because, as we have seen, it lays hold of the global evil by the
root, and indeed by the main root.
Only when the groundlaying demand for abolition of
interest-slavery is fulfilled, is the path cleared for the first time ever for the social state. This
must be clearly recognized, and it must be accomplished in spite of all
Mammonistic powers. The cry for socialization [while interest-slavery persists]
is nothing more than the attempt to bring about the formation of a trust of all
industries and to create giant conglomerates everywhere, over which big
loan-capital, in spite of all wealth- taxes, will naturally also have the
deciding influence again in the future. A socialistic state on a Mammonistic
foundation is an absurdity and leads by nature to a compromise between Social-
Democracy, already strongly contaminated with Mammonism, and big capital.
We, by contrast, demand radical rejection of the
Mammonistic state and a reconstruction of the state according to the true
spirit of socialism, in which the ruling basic idea is the obligation to
nourish -- in which an old basic demand of Communism can find its rational and
useful satisfaction -- in the form that every member of the folk shall
receive his assigned entitlement to the soil of the homeland through the
state's allocation of the most important foodstuffs.
We further demand, as a skeleton for the new state, a
representation of the people through the Chamber of People's Representatives,
which is to be elected on the broadest basis, and next to that a permanent
Chamber of Labor, the central council in which the nation’s workers have a
voice in proportion to their distribution by profession and economic class.
Finally we demand the highest accountability for the directors of the state.
This new construction of the state on a socialist-aristocratic basis will be
treated in an additional work that will appear soon from the same publisher.
The prerequisite for all this construction however
remains the abolition of interest-slavery.
My unshakable belief, nay more, my knowledge makes me
recognize clearly that the abolition of interest-slavery is not only
enforceable but will and must be taken up everywhere with indescribable
jubilation. For bear in mind: in contrast to all other ideas and movements and
endeavors, however well intentioned, that aim at the improvement of mankind, my
proposal does not want to try to improve human nature; rather it applies itself
against a toxic substance, against a phenomenon that was artfully – no,
diabolically – invented, completely contrary to the deepest feeling of man, in
order to make humanity ill, in order to ensnare humanity in materialism, in
order to rob from it the best thing that it has, the soul.
Hand in hand next to it goes the frightful, pitiless
tyranny of the money-powers, for which people are only interest- slaves, exist
only to work for the dividend, for interest.
Deeply troubled we recognize the frightful clarity and
truth of the old Biblical proverbs, according to which the god of the Jews
Yahweh promises to his chosen people: “I want to grant to you to own all
treasures of the world; at your feet shall lie all peoples of the Earth and you
shall rule over them.” This global question is now laid out before all of you.
Global questions are not solved with a wave of the hand, but the idea is clear
as day. And the deed must be diligently propagated; we must understand clearly
that we face the most formidable enemy, the world-encompassing money-powers.
All force on the other side, on our side only justice, the eternal justice of
productive labor.
Extend your hands to me, working people of all
countries, unite! Publisher’s Afterword While repetitive at times, this
Manifesto clearly stresses the importance of ending interest-slavery and
presents some of the many benefits that would arise from such a radical
departure of what we know as the "norm." What most Americans are
unaware of is how much emphasis the Nazis placed on uplifting the working
class. This lack of awareness comes in spite of the NSDAP name : National-
Socialist German Worker's Party.
Concern and struggle for the working class continues
today, as does the movement to end profits without work - interest-slavery.
Such modern struggles have been far more successful in Europe than in the
United States, but there is a single American organization calling itself the
"American Nazi Party" ( www.anp14.com ) that continues to harp on
very similar economic principles as Feder and the NSDAP. In fact, due to the
ever increasing wage disparity in the US, coupled with high unemployment rates
nationwide and general dissatisfaction with the current government, such
movements are currently seeing relatively strong growth.
It is clear as to why Feder's ideas have not taken
root in modern society, and that is because of the influence that the
international banking powers wield over most nations. In the US, the Federal
Reserve is a private banking entity that is not accountable to the US
Government, yet they hold tremendous power over the American economy. Had
Feder's ideas been implemented here in the States, Ceteris paribus, it is
almost certain that the recent mortgage crisis of 2007, which led to deep
recession, high unemployment, and the big bank "bailouts" wouldn't
have occurred.
This publisher hopes that the Manifesto was read with
an open mind, free of any preconceived ideas about "Nazism" or the
horrors of war that are so often associated with the 3rd Reich. Clearly there
was much more to the ideology and practices of National- Socialist Germany than
the History Channel or even most "history" books provide. Modern
governments have taken much from Nazi Germany such as laws protecting animal
rights, the "green" movement (see Richard Walther Darré), paid
vacations and other labor comforts that we take for granted today. Would it be
too absurd to suggest that maybe their economic policies held some merit as
well? [1] The following declarations about the Bavarian state budget are
in rounded figures taken from the Bavarian State Yearbook of the year 1913.
This is the last statistical yearbook that appeared before the war, which gives
exhaustive reporting about Bavarian finances. During the war no more recent
reports appeared.
[2] The
unceasing increase in interest-rates and material-prices has led to the fact
that the net yield of the Bavarian state railroad in the year 1918 has declined
to 3 million marks, compared to an average of 80 million in preceding years. In
Prussia, according to the reports of Finance-Minister Simon, the previously
customary average profit of 700 marks has even been replaced by a deficit of 1,300,000,000
marks. We will therefore be less able than ever to think about continually
increasing direct and indirect taxes; we must think more than ever about
immediately reducing the new debts that have grown through catastrophic
finance-economy by very strong requisitioning of wealth, especially from the
very large fortunes.
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