Resistance to direct taxation is widespread, yet counterfeiting by another name—money printing—faces little opposition.  The truth is stark: printing more money doesn’t create more goods.  Instead, the wealth is redistributed to those who receive the new money first.  While taxation faces natural limits—higher rates often reduce total revenue—money printing offers an alluring alternative for governments desperate to expand spending.

This new money originates from the banking system.  Banks assess borrowers’ ability to repay, but the system hinges on a critical condition: the monopoly on money creation.  Without a monopoly, competing banks would expose each other’s inability to back demand deposits fully.  To maintain this facade, the state orchestrates a banking cartel.

Yet, even this cartel faces obstacles.  Gold, historically the backbone of money, is costly to mine and limits excessive creation.  To bypass this limitation, gold was replaced by paper—cheap, abundant, and easy to produce.  This sleight of hand mirrors the scene in Goethe’s Faust where Mephistopheles persuades an emperor to issue paper money.  In the play, it’s a clever deception.  In reality, it’s a system of legalized theft.

Newly printed money can be exchanged for real goods, but the privilege to counterfeit remains exclusive to the state and its central bank.  The incentive to control money is clear: the power to create value out of thin air is irresistible.  What’s harder to understand is why the public accepted this system—and continues to accept it over a century later.

One might expect such a blatant scheme to be rejected outright.  Yet since the Federal Reserve was established in 1913, resistance has been minimal.  The masses seem to embrace what harms them most.  The root cause lies in ignorance—a lack of understanding nurtured by state-controlled education and relentless propaganda.

The Federal Reserve Act itself was rushed through Congress, accompanied by lofty rhetoric and derisive criticisms of gold.  Terms like “barbarous relic” painted gold as outdated, while the concept of “elastic money” cloaked the scheme in pseudo-scientific respectability.  The truth behind these sophisticated-sounding arguments?  A lament that counterfeiting wasn’t yet possible under the gold standard.

This system has achieved what alchemists only dreamed of—not turning base metals into gold, but paper into wealth.  Astonishingly, this illusion endures, reinforced by a well-funded army of propagandists.  Despite occasional outcries, the public quickly forgets, entranced by the system’s complexity and misled by its apologists.

Only a figure as cunning as Mephistopheles could have devised something so insidious.  Yet this is not fiction; it is our reality—a reality where the deception continues to flourish, unchallenged by the very people it impoverishes.

References

Hans-Hermann Hoppe; The Great Fiction

Murray Rothbard; What Has The Government Done to Our Money

Johann Wolfgang von Goethe; Faust – Parts I&II