American Monetary Institute

Review of Richard C. Cook’s “We Hold These Truths”

Reviewed by Jamie Walton, American Monetary Institution (AMI) researcher

[This book is available from the American Monetary Institute, at $30, post paid.]

This book is for anyone and everyone who wants to solve the world’s deepening crisis and to avoid a looming catastrophe. Richard C. Cook hits all the economic nails on the head in his latest book, We Hold these Truths: The Hope of Monetary Reform. Very rarely does a book appear that lays out what’s really wrong with ‘the economy’ and what’s required to really fix it. This is one of those very rare books. It’s a must-have handbook to build your own clear and deep understanding of what’s really going on, why, how, and what can be done about it.

Many readers probably first discovered Richard C. Cook when his far-reaching articles began hitting the Internet like lightening-bolts in early 2007, sounding a wake-up call for monetary reform around the world. In these articles, Cook busts open the ‘econo-myths’ to expose the lies that ‘econo-speak’ tries to keep hidden. This book is based on 16 of the very best of these articles, updated and pieced together to form a real-world economics lesson that reveals the big picture.

With more than 32 years of experience as a government analyst to draw from, including 21 years in the U.S. Treasury, Cook shares his inside knowledge of the economy from a rational, analytical standpoint. Combine this with the culmination of his own research and deep understanding of the way the economy actually works, then add in his rare ability to convey this knowledge and understanding with clarity, passion and compassion, and the result is a very important overview of the way things are, and the way they can be.

While I had already read all of the articles in this book as they were released on the Internet, it was a real treat to read them again in one flowing sequence, and I found them as fresh and exciting as the first time. What struck me was, even though I had read them before, the articles took a long time to read again – not because of a difficult writing style (the articles are beautifully written), but because they are packed with such profound statements of truth that I found myself just thinking about a sentence or paragraph for about half an hour or so. In trying to pick out the most important points for this review, I found myself underlining almost every sentence, so I had to re-read it and mark the margins. Only some of the triple-marked points have made the cut to be covered in this review, otherwise the review would be a very long essay.

What’s it all about?

Have you ever wondered … Why are we working harder just to make ends meet, despite centuries of labor-saving technological advancements? Why is it that the more ‘productive’ we are, the worse off we get financially? Why do all of the ‘solutions’ offered by the ‘experts’ only make things worse?

Cook answers these fundamental economic questions with analytical authority and inspired insight.
More importantly, Cook asks some fundamental moral questions, and goes straight to perhaps the most pertinent one of all right up front:
“Does the earth exist so that the few can use its bounty to enslave the rest?” (p. xv)

Cook explains how we are being denied freedom over our own lives. How we’re being forced to spend our precious time tied to a treadmill in a vain attempt to keep an artificial perpetual-debt-machine running. How our lives are being stolen from us because money has been switched for debt, and this debt has been made to hang over us like a curse, taking a very heavy toll on our well-being.
Cooks shows that this ‘debt-perception’, like a curse, is only real if we believe it’s real – when we stop believing the lies that underpin it, and see that they’re not real at all, we can free ourselves very quickly.
Cook goes straight to the heart of the matter

Cook identifies that the root cause of our needless suffering is a debt-based monetary system.

It’s this system which wrongfully ties us to perpetual debt. As Cook describes it, it’s:
“an outdated and terribly corrupt system whereby money, the lifeblood of economic life, is introduced into circulation only as interest-bearing debt.” (p. xv)
Cook suggests this “system of institutionalized debt oppression may be deeply unconstitutional” as it can be shown to work for “the benefit of the few over the well-being of the many” (p. 77), rather than ‘promote the general welfare’, and its effect may even more directly contravene our Constitution:
“this system … might even violate the Thirteenth Amendment, which states that, ‘Neither slavery nor involuntary servitude … shall exist within the United States.’” (p. 179-80)

Thus, the very existence of a debt-based monetary system is “a travesty which negates democracy at every step.” (p. 248)
He explains why things can only get better when we overcome this system, and why, without doing this, any moves to achieve significant and lasting improvements will ultimately be ineffective.
Cook accurately identifies the problem

Cook examines the problems that plague society and our economy: war, poverty, the ‘immigration crisis’, ‘outsourcing’, ‘bubbles’, ‘inflation’ and ‘recessions’, etc., and shows that they’re all really effects of a deeper problem, all lead back to a common cause: the practice called ‘fractional reserve banking’.

He reveals that the world’s central bankers can’t stop these ill effects and the eventual downward slide of the economy “because the systems they operate are the primary cause.” (p. 138)
Cook highlights why and how this situation is totally unjustifiable, because:
“fractional reserve banking … grants the banks a privilege which is undeserved. Essentially this makes the banks the owners of the money supply.” (p. 211-12)
While the iniquity of this should be obvious, Cook shows how a ‘fractional reserve banking’ system is also woefully inadequate to meet the needs of society, achieve the stated aims of the U.S. Constitution or even the stated aims of the Federal Reserve System – in fact it works against all of them.

Cook stays on target
Cook separates cause from effect, only referring to effects to trace them to their cause. He exposes the extent to which reason, reality and morality are ignored by ‘conventional thinking’, and how instead:
“We’ve learned to blame the victim, failing to see that … one thing is connected to another. A good investigator always asks, ‘Who benefits?’” (p. 12-13)

Cook’s investigation clearly demonstrates who is benefiting and who isn’t: “The effects of current economic and monetary policies are starting to approach the level of genocide against large segments of society, if not in their intention, at least in their effects. Crime, health, and income statistics identify vast areas of both urban and rural environments as what have aptly been called ‘death zones’.” (p. 127)

Cook describes how control of the money supply by the banking system has diverted resources more toward real estate, speculation and warfare than toward the productive sector, i.e., toward bidding-up and betting on the prices of existing things or destroying them instead of developing new things. This adds new money and debt to the economy without necessarily adding any real wealth. The result is the U.S. dollar has lost over 95% of its purchasing power in 95 years under the present system.

Much worse is the link between the present system and war. Cook explains why ‘full-spectrum’ military dominance is really “a weakness, showing a broad-spectrum failure to devise rational, humane, and multilateral solutions to trade and economic issues.” (p. 2) He goes on to explain how “The number one cause of war in the modern world is the debt-based monetary system run by the banks.” (p. 200)
Cook knows the importance of defining terms

Cook writes about money and credit being a public utility. This is where precise definitions are so vitally important, as it could be misinterpreted in a number of ways. Fortunately, Cook makes it explicitly clear precisely what he means by credit, and that it is not the same as money:

“The idea of credit when viewed from a macroeconomic perspective refers to the ability of an economy to produce goods and services of value to the members of that community. It refers to the potential value of that economy to support life. What it does not and cannot refer to is money in and of itself, because money, as we have seen, has no intrinsic value. Without the credit- potential of a producing economy, money has no meaning.” (p. 57)
Obviously this credit belongs to the whole of society, it doesn’t belong to any particular part of it, certainly not any banking system and certainly not any government. So when Cook talks about “public” he’s talking about something societal, not institutional. Likewise, when he talks about “utility” what he’s talking about is a general means of provision, not any specific institution (he’s certainly not advocating that government takes on or takes over commercial banking activities).

Cook clearly distinguishes between credit and money and clearly shows that money is that general means of provision; it’s what’s needed to pay for the things a producing economy can provide. Obviously somebody has to create, issue and regulate our money, and as Cook rightly says throughout the book, that somebody should be the U.S. Government, as provided for in the U.S. Constitution, since it’s U.S. law which makes the U.S. dollar the officially-accepted – and therefore generally-accepted – money of national currency of the U.S. – nothing else makes it so. Cook is very clear on this:

“Money is obviously an indispensable component of our economic system. If it is properly constituted and managed, it has the ability not only to command goods and services produced within the system, but also to encourage and call forth new types and quantities of production. … how it is created and introduced into circulation, how its value is established and maintained, and how it is used … to further the ideals of society are critical issues that properly fall within the purview of political debate. … history shows that money serves its socially-beneficial purposes only when it is regarded as an instrument of law and an economic medium-of-exchange and when it is regulated by a government which can responsibly direct its benefits to the welfare of all citizens.” (p. 178-79)

Cook explains how the mis-definition and misconception of money has been used to keep us shackled to “a medieval relic” of a system which pretends to see money as wealth and debt at the same time: “Fractional reserve banking … has resulted in a condition of growing debt slavery fixed upon our population which is afflicted with a chronic shortage of purchasing power sufficient to absorb our national production.” (p. 179)
The lesson: if money is confused with wealth or debt, then our democratic and human rights are bound to be stamped on.

Cook shows the way forward
Cook makes it clear how our world is being kept in continuous ‘crisis mode’ due to the way the present monetary system is constructed, but precisely because it’s a man-made system, we can always change it – “Since the causes of the crisis are monetary, so would be the solutions.” (p. 135)

Cook says if we really want to solve things, we need fundamental monetary reform at the national level – “as the American Monetary Institute (AMI) is proposing with its draft American Monetary Act.” (p. 8 ) – as the key to making it happen. Cook knows exactly what has to be done first:

“The first measure in bringing about change, taking the U.S. as an example, would be for the federal government to create a Monetary [Authority] as envisioned by the American Monetary Institute … [to assure] that the money supply is sufficient to express the real credit demands of the nation in paying for the GDP.” (p. 65)

Cook explains this means ensuring there is always enough money in the system to finance and purchase the goods and services that our economy produces, and explains how it can easily be done:
“The key to any real change is fundamental monetary reform that would restore balance to the economic system. … The best kept secret on earth is how easily this system could be changed, not only in the U.S. but in any nation …” (p. 128)
Throughout, Cook makes a clear distinction between what is real and what is financial. Once this is realized, the absurdity of our present situation becomes clear:
“The U.S. and world economies are on the brink of collapse due to the lunacy of the financial system, not because we can’t produce enough.” (p. 149)
Importantly, Cook always brings morality to the fore as a measure by which to judge results:

“An economic system should reflect what is right and fair for those it affects” (p. 153-54)

Cook shows us how we can and must move away from the bad practices and bad attitudes of the past
– in order to “resolve the present crisis and carry us into a future that will benefit everyone” (p. 167)

In summary, Cook gives us a roadmap toward making our systems work to provide prosperity, peace and justice for all. Regarding monetary reform, he absolutely nails it, with the American Monetary Act.
This book is for anyone and everyone who wants to solve the world’s deepening crisis without a catastrophe. This book will move you, and hopefully move you towards positive action. In that sense, it’s a ‘dangerous’ book – dangerous for the status quo that is – even more reason to get it!

For disclosure purposes, I met Richard Cook at the inaugural AMI Monetary Reform Conference in 2005 and have been in contact ever since. I have been acknowledged for making some contribution to this book.