The “Business” of Central Banking—Usury and Tax Farming
Central banking is “a great business to be in, where you print money, and people believe it.”
That’s what the head of New Zealand’s central bank said recently in an unscripted moment of candor.
It led me to wonder about the nature of this strange “business.”
Let me put it into the simplest and most concise terms.
- Central banks create fake money out of thin air and loan it to governments at interest.
- Governments use violence and threats of violence to extract taxes from average citizens to pay the interest on the fake money the central banks created out of thin air.
- Like the mafia, they can deploy violence to ensure there is no competition to their privileged racket.
That’s the unvarnished truth about central banking.
In short, it’s the business of usury and tax farming.
(To me, a more practical modern meaning of usury is “enslaving people with financial trickery.” Central banking clearly fits the bill.)
The central bank is a powerful wealth transfer mechanism that enables governments to harvest the productive efforts of their citizens efficiently and surreptitiously.
The central bank’s currency debasement transfers wealth from savers to those closest to the money printer, namely governments and their cronies.
The central bank’s real mandate is to transfer as much wealth as possible via currency debasement to the political class without causing alarm among the plebs. Ideally, it happens gradually so nobody notices, like a child taking only a little money out of his mother’s purse each day so she doesn’t notice.
However, sometimes their theft spirals out of control, and it’s impossible for the plebs not to notice.
Consider this.
The Federal Reserve—the central bank of the US—has printed more fake money in recent years than it has for its entire existence.
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