From "Henny Penny" Morgenthau to Henry Paulson: The Circumstances of Today's $700 Billion Bailout Are Eerily Similar to Those of FDR's New Deal, and Today's Pied Pipers Are Playing the Same Bipartisan, Power-Grabbing Tune

By Jasper, William F. | The New American, November 10, 2008 | Go to article overview

From "Henny Penny" Morgenthau to Henry Paulson: The Circumstances of Today's $700 Billion Bailout Are Eerily Similar to Those of FDR's New Deal, and Today's Pied Pipers Are Playing the Same Bipartisan, Power-Grabbing Tune


Jasper, William F., The New American


"It's not based on any particular data point," a Treasury Department spokeswoman told Forbes.com concerning how the figure of $700 billion was arrived at for the financial bailout package. "We just wanted to choose a really large number."

Choosing a "really large number" helps, of course, if one is trying to convince the American public that the nation is facing a really large emergency, and that the government must be given really large powers and really large sums to deal with the emergency. Which is why governments love emergencies and crises, whether real or imagined.

Over the past few weeks, Treasury Secretary Henry Paulson has led a team of Henny-Penny alarmists sowing panic over the troubled financial markets. "The sky is falling, the sky is falling, and only massive emergency government intervention can save us" they claimed in so many words.

The panic strategy worked, and the Henny Pennies have won--for now. On Friday, October 3, despite massive public opposition to the bailout (with members of Congress and media organizations reporting that calls were running 100 to 1 against), the House of Representatives followed the Senate's lead and approved the so-called Emergency Economic Stabilization Act of 2008, which may prove to be one of the biggest wealth-transfer schemes in history. On October 4, Bloomberg.com reported:

   The House approved the measure
   263-171 yesterday, four days after
   rejecting an earlier version by 228
   to 205. The bill's defeat caused a 778-point
   drop in the Dow Jones Industrial
   Average, prompting dozens of
   lawmakers to switch their vote on
   the package, the government's largest
   step into the markets since Franklin
   Roosevelt's New Deal.

[ILLUSTRATION OMITTED]

Another "New Deal"?

The Bloomberg reference above comparing the current bailout to FDR's New Deal is chilling to all who are even remotely familiar with the tyrannical powers and policies that accompanied the Roosevelt revolution.

Some important insights into that important era have been provided by Roosevelt's Secretary of the Treasury Henry Morgenthau, whom FDR affectionately referred to as "Henny Penny," a moniker which was then picked up by the press and affixed to the treasury secretary. In his private diary, "Henny Penny" told of the strange daily ritual known as the "bedside conference" that greatly affected the economy of the entire nation and, indeed, much of the world. According to Secretary Morgenthau, he and Jesse Jones, head of the federal Reconstruction Finance Corporation, would meet in the morning in the president's bedroom, where Roosevelt ate his breakfast in bed from a tray. The three of them would then proceed to set the daily price of gold. Here's how Morgenthau described the process in his diary: "The actual price of gold on any given day made little difference. The amounts settled on were generally arbitrary. One day, for instance, the bedside conference decided on a rise of 21 c[ents]; 'It's a lucky number,' the President remarked, 'because it's three times seven.'"

[ILLUSTRATION OMITTED]

Morgenthau commented: "If anybody ever knew how we set the gold price through a combination of lucky numbers and so forth, I think they would really be frightened."

Contrary to Henny Penny Morgenthau's diary claim, the price of gold on any given day made a great deal of difference--which was the whole point of the daily bedside conference. Having already confiscated all gold from the American people by executive fiat, FDR's Brain Trust then proceeded to steal the people's wealth through the hidden confiscatory tax of inflation. The great gold robbery had been effected by Roosevelt's Executive Order 6102, of April 5, 1933, which, invoking the ongoing "national emergency," declared: "All persons are hereby required to deliver on or before May 1, 1933, to a Federal Reserve Bank or a branch or agency thereof . …

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From "Henny Penny" Morgenthau to Henry Paulson: The Circumstances of Today's $700 Billion Bailout Are Eerily Similar to Those of FDR's New Deal, and Today's Pied Pipers Are Playing the Same Bipartisan, Power-Grabbing Tune
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