Weekly Update - A publication of the Michigan Militia Corps

Volume 3, Issue 31

October 10, 1996



"Full Faith and Credit?"

by the American Institute for Economic Research



        During the threatened and partial government shutdowns of 1995 and

early 1996, the media and the politicians mercilessly hyped the potentially

historic defaults in U.S. Treasury securities, even though at most it might

have caused a minuscule blip in the U.S. financial data. They remained

characteristically silent, however, about related episodes of monetary

misfeasance, as well as the checkered and vastly more significant history or

the currency in which the debt is denominated. In real terms, the U.S.

Government has continuously reneged on Treasury obligations since the advent

of fiat currency (federal reserve notes). In this sense, it now routinely

conducts government by default.

        The repeated possibility of a default on payments to bidders of some

U.S. Treasury securities were greeted with almost universal dismay in some

media circles. Prominent in many news reports was the view that such a default

would mark a historic break with the federal government's unblemished record

of honoring its financial obligations - and might precipitate any variety of

dire consequences, from increased interest rates and higher budget deficits

to widespread financial panic.

        Not surprisingly, Wall Street generally responded otherwise. The

entire episode was largely ignored by the financial markets. Yields on

Treasury bills during the weeks of the threatened default were virtually

unchanged and have remained so. Reportedly in the expectation that the Fed

would actually lower its discount rate in December, 1995 the Dow Jones

Industrials Average soared to successive new highs above the 5,000 mark. At

least one Wall Street guru predicted that yields on long-term government

bonds would soon drop below 5 percent; meanwhile, several U.S. corporations

announced their intention to float new issues of 100-year debentures. In

short, despite the sideshow inside the Beltway, it was business as usual (and

then some) in the financial world.

        Of course, Wall Street sentiment has never been an accurate barometer

of the actual financial condition of borrowers (as long as the commissions

roll in), and there are many reasons to believe that the federal government

is not necessarily a good credit risk, especially in the long-term. However,

the default issue is a political red herring. More significant, it is not the

most important part of the story - the part that the popular media choose to

ignore completely.

        Longtime readers of American Institute for Economic Research

publications know that for many decades we have chronicled the federal

government's misfeasance in monetary affairs. Any reverses that the

government's current creditors might suffer as a result of, say, a temporary

default on T-bills, pale in comparison with the losses to investors and

savers over the decades from such monetary mischief. It may be useful to

re-count briefly some highlights (if they can be called that) of that record.



It Wouldn't Be the First Time



    Even were the Treasury to default, it would be far from the "first time"

that the federal government has reneged on its financial obligations - mainly

by manipulating the currency in which its debts are denominated. For example,

during the 19th century, at times of financial stress (usually wartime) the

convertibility of the dollar into gold or other monetary metals was suspended

or interrupted. As a consequence, the purchasing power of the currency

invariably plummeted until convertibility was restored or, as in the 1870s,

until the promise of resumption of specie payments for paper currency had

been secured.

        The passage of the Legal Tender Acts during the Civil War, which

authorized the government for the first time to issue non-interest bearing

legal-tender notes in which its own debt could be repaid, and which remains

the hallmark legislation for today's fiat currency, was perhaps the most

egregious manipulation of U.S. currency to that point. It halved the

greenback's purchasing power - as well as the real return to holders of

public debt - in a mater of months.

        In view of the dollar's subsequent decline, however, the most

significant monetary event in the Nation's history was the government's

permanent abrogation of its domestic gold obligations in June 1933 - a massive

default that virtually every politician today chooses to ignore. At the time,

however, some saw it for what it was. When President Roosevelt asked then

Oklahoma Senator Thomas P. Gore, a close student of monetary economics, his

opinion of the matter, the Senator is reported to have replied; "Why, that's

just plain stealing, isn't it, Mr. President?"

        As the Roosevelt administration repudiated domestic monetary

obligations, so the Nixon administration reneged on U.S. international

monetary obligations by closing the "gold window" in 1971. With that action,

the United States formally renounced any intention of honoring the

obligations that for the previous two centuries had governed international

financial settlements. In short. the U.S. government has a "rich" tradition

of stifling its benefactors -- creditors and trading partners alike.



The $11 Trillion Theft



        That unhappy tradition extends far beyond past and present holders of

U.S. Government securities. Virtually all savers and investors who held

dollar-denominated assets have suffered enormous losses due to the decreased

purchasing power of the dollar. According to our most recent calculations the

total of Americans' savings embezzled through the inflating process since

1939 amounts to almost $11 trillion in today's dollars.

        In recent decades, even those who invested in "riskless" long-term

U.S. Government securities sometimes received, in real terms, a negative

after-tax return on their investments. Such was the situation with a 32-year

U.S. government bond issued in February 1958, midway in the 1957-58 business

contraction. That bond yielded nominal interest of 3.5 percent and matured in

February 1990. But during the lifetime of the bond the dollar lost more than

three-fourths of its purchasing power. At the marginal tax rate faced by

individuals with taxable incomes of $75,000 in 1990 dollars, the total of all

interest payments and return of principal to the holder of $10,000 of these

bonds was roughly $6,600 in 1958 dollars, for an internal rate of return of

-2.1 percent. Taxes and inflation absorbed an interest income and about

one-third of the principal. In effect, such an "investor" paid the government

for the privilege of lending it money. It is not without reason that the late

Dr. Franz Pick termed long-term Government bonds "Certificates of Guaranteed

Confiscation."

        In any event, it seems clear that over the long run it is mainly

monetary events that have generated credit problems for the U.S. Government.

Interest rates usually have spiked upward at times when the dollar has been

most vulnerable to losses in purchasing power and moderate with the return to

convertibility. Since 1933, there has been no restoration of convertibility,

and interest rates have remained far above their historical levels.



Who Comes First When the Money Gets Short?



        Congress ultimately controls the purse strings of the federal

government via the debt ceiling. The President is expected to live within the

financial means so provided and, when the money gets short, to influence (via

the veto and other executive powers) how available funds will be spent.

Whatever the rhetoric, in practice it is precisely during such times of

financial strain that any administrator reveals its genuine priorities - as

the Clinton administration seems to have done in this latest budget impasse.

        In raising the possibility of a default, the President in effect

announced that when the money gets short those who lend money to the

government stand last in line - behind the mohair and sugar subsidies, behind

the public television and radio subsidies, behind the subsidies to art and

culture, behind welfare and entitlement recipients, behind double-dipping

civil service retirees and almost anyone else now on the receiving end of

federal outlays.

        When a private firm's management juggles the books or chooses to pay

extravagant payrolls instead of its creditors, it quickly finds itself shut

out of the credit markets (and perhaps shut into prison). Today the senior

managers of the federal government may believe that the dollar's stamina

against most other currencies has largely immunized them against that

possibility. Presumably, however, even the most forgiving lenders will take

only so much abuse; if the markets were suddenly to lose confidence in the

dollar, the U.S. Government's ability to borrow even from its current

creditors could vanish just as quickly as it has in other countries that

reneged on their debts - or paid them in near-worthless currency.



Anti Shyster, Volume 6, No. 2





Germ Warfare Against America

The Desert Storm Plague and Cover-Up



        "Our afflicted veterans are sick and suffering and many have died.

Others are now destitute having spent tens of thousands of dollars, depleting

their life savings, in an unsuccessful search for an explanation for their

ailments. The veterans of the Gulf War have asked us for nothing more than

the assistance they have earned. Our refusal to come to their immediate

assistance can only lead others to question the integrity of the nation they

serve." -Senator Donald Riegle (D-MI)

        "The horrible secret of America's worst atrocity is out: our

servicemen and women were exposed to deadly chemical and biological agents

supplied to our enemies by our own government." -- Joyce Riley, Director,

American Gulf War Veterans Association

        "This disease could be a holocaust of monumental proportions as it

has been genetically engineered." -Cell Microbiologist, Dr. Nancy L. Nicolson



Introduction



        A plague is breaking out in America, in England, in Europe, in the

Middle East, and in 27 out of 28 countries which were involved in the Desert

Storm War in 1990 and '91. Germ warfare was used by Saddam Hussein against

the American and alliance troops in that brief war -- biologicals which were

illegally manufactured in America and sold illegally to Iraq from 1985-'90

with the approval and blessings of the Reagan and Rush Administrations. These

biologicals were then unleashed on American and alliance troops via Iraqi

Scud missile attacks.

        Some died quickly from intense exposure to chemical and biological

weapons, but most received low level doses and returned home with the

disease(s). It is now estimated by reliable sources that 100,000 to 200,000

of the 700,000 troops we sent to Desert Storm are now sick and/or dying with

Gulf War Illness and that 15,000 of these young servicemen and women have

died from the disease.

        Furthermore, tens of thousands of wives, children and other family

members are now contracting the moderately contagious, highly communicable

disease from the veterans, and thousands of babies are being born to these

veterans, deformed like the thalidomide babies of the 1950s. (See November

95 Life special; "The Tiny Victims of Desert Storm.")

	Meanwhile, the U.S. government, which helped create the biologicals

which Saddam used against our own troops, flatly denies that any chemical or

biological agents were used in the Gulf War, flatly denies the existence

Desert Storm (or Gulf War) Illness, and is flatly denied medical treatment to

several hundred thousand sick or dying Desert Storm veterans, spouses or

their children.

        [ED. NOTE: Just as they denied the existence, or hideous legacy of

Agent Orange for over 15 years after the end of the Vietnam War. It is said

that nothing is totally confirmed until officially denied by our government.]

        And Gulf War Illness (resulting from up to 15 separate biologicals

which Saddam used) is only one of dozens a deadly new illnesses that are now

emerging all over the world (Mad Cow disease in England, AIDS, Hanta-Virus

Ebola Zaire, the flesh eating disease, and dozens more).

        The Los Angeles Times (5/20/96) wrote in an article entitled: "Report

Warns of Global Health Crisis" and subtitled: "Infectious Diseases: Despite

Medical Advances Millions Are Dying" declaring a 'global crisis' and warning

that 'no country is safe lom infectious diseases.' The World Health

Organization says in a new report that diseases such as AIDS, Ebola, Hanta,

Mad Cow, tuberculosis. etc. killed more than 17 million people worldwide last

year, including 9 million children.

        "Taken together, bacterial, viral and parasitic diseases remain the

world's leading cause of premature death, accounting for one out of every

three deaths, the report says. For instance, the No.1 infectious disease,

tuberculosis, took 3.1 million lives last year, up 400,000 from WHO figures

for 1993.

        [Ed. Note; These numbers make gun and all other violent deaths appear

to be a tempest in a teapot. It seems that maybe we should be more worried

about these silent killers.]

        "The report also suggests with uncommon starkness that in today's

global community, populations mix with unprecedented ease, and disease

organisms have the potential to spread among countries at jet speed. Among

the reasons that many infectious diseases are spreading so rapidly, the WHO

report says, are growing antibiotic resistance and heavy international air

travel."



What is Gulf War Illness (GWI)?



        GWI is a communicable, moderately contagious and potentially lethal

disease, resulting from a laboratory modified germ warfare agent called

Mycoplasma fermentans (incognitus). [ED. NOTE: There were actually up to 15

such agents used in Desert Storm by Iraq - only three have been identified at

this writing: Mycoplasma fermentans (incognitus), Mycoplasma genetalian, and

Brucella species.] Mycoplasma fermentans (incognitus) is a biological which

contains most of the HIV envelope gene, which was most likely inserted into

it in germ warfare laboratories.

        GWI spreads far mare easily than AIDS, by sex, by casual contact,

through perspiration, or by being close to someone who coughs. Your children

can be infected at a playground or school. The Nicolsons, who have isolated

the microorganism, say that it is airborne and moderately contagious.

        To illustrate the moderately contagious nature of the biologicals

Saddam used, Dr. Garth Nicolson cited the case of a young woman who served in

a transportation squad who contracted GWI while assigned to a graves

registration unit during the hostilities. She is currently the sole survivor

of the 16 members of her unit.

        GWI is the direct health consequence of prolonged exposure to low

(non-lethal at the time of exposure) levels of chemical and biological agents

released primarily by direct Iraqi attack via missiles, rockets, artillery,

or aircraft munitions, and by fallout from allied bombings of Iraqi chemical

warfare munitions facilities during the 38-day war.

        The effects of these exposures were exacerbated by the harmful and

synergistic side affects of unproven (untested) pyridostigimine bromide (PB)

pills (nerve agent pre-treatment pills) forcibly administered to our troops,

botulinum toxoid vaccines (also untested and experimental) forcibly

administered to our troops, anthrax vaccines, and several other experimental

vaccines, all forcibly administered to our troops like so many laboratory

guinea pigs.

        Estimates of the number of vets who are sick are just that -

estimates. Over 160,000 sick Gulf War vets have reported to the Gulf War

Registry (kept by the Department of Defense - which still maintains that the

disease does not exist). This does not include wives, children or other

family members, friends or associates (secondary infectees) who are sick,

disabled, dying or dead.

        By August 15, 1992, 17,000 out of the 100,000 reservists and National

Guardsmen who served in the Gulf conflict had reported to the VA that they

were ill. Four years later (in August '96) that number is likely to have

tripled to 51,000, or over half of the total. Joyce Riley estimates that 1/2

of all Desert Stormers may now be positive for Mycoplasma fermentans

(incognitus). Riley (and the Nicolsons) also estimate that a large percent of

all GWI victims may ultimately die from the disease, or suicide.

        On 7/31/96, Tony Flint, spokesperson for the British Gulf War

Veterans Association, reported that the number of GW veterans deaths in U.K.

is 1,233 out of 51,000 Brits who participated. Of these deaths, 13% or 162,

were from suicide. These are huge numbers who took their lives due to their

lack of treatment and incredible pain levels.

        Whole families are now ill. Nor do the above numbers include babies

which are being born dead or severely deformed like the thalidomide babies of

the '50s. Some of the baby deformities are Goldenhar syndrome, wherein babies

are born with one or more limbs missing, a missing eye, or other deformity.

It is now estimated that a large percent of babies born to infected veterans

are being born deformed or with birth problems.

        The study done for former U.S. Senator Don Riegle (D-MI) concluded

that 78% of wives of veterans who are sick are also likely to be sick, that

25% of their children born before the war are also likely to be sick, and

that 65% of children born to sick Gulf War veterans after the war also are

likely to be sick.



MIA, August 1996





The UN: Alive and Well in Michigan



        On September 30th our own Tom Wayne attended a UN meeting held at

Kalamazoo's First United Methodist Church. The speaker was Berit K. Collett,

Assoc. Quaker rep. to the UN. According to Tom, she started out the meeting

complaining about the Militia of Michigan. For some reason she says that

we're not very popular with the UN. (I don't know about the rest of you

folks, but my heart really bleeds to hear that information.)

        Ms. Collett (see, I can be politically correct) then proceeded to

discuss the meeting in Beijing, China, telling the people there how the UN

was empowering the women of the world, after which she returned to the

subject of the Michigan Militia. She said that Boutros Boutros-Ghali had

warned her to watch out for black helicopters while she was in Michigan, much

to the amusement of all. During this time, they were also watching protesters

(Militia personnel) carrying the anti-UN flag back and forth in front of

their windows.

        The discussion then returned to the conference in China and the

listeners were told that Hillary Clinton had promised that the U.S. would

give $20 billion to the UN to be used for world education and that the money

would be distributed by the UN. Somehow, the conversation always seemed to

drift back to the Militia. These people were totally unaware that Tom Wayne,

XO of Michigan Militia sate command, was present and he really had to bite

his tongue.

        After almost an hour of this, some of the people suggested that they

bring the Militia (the protesters) in to listen to the speaker. According to

Tom, Ms. Collett suggested that maybe they (the Militia) didn't have enough

intelligence to understand. At that point, Tom seized his opportunity and

stated that there was no need to interrupt the meeting because the Militia

was represented. The room fell silent for a moment and then people began to

gasp and all heads turned to the back of the room (where Tom was seated) and

the people stared in disbelief.

        He proceeded to tell the speaker that maybe she should reread her

history book on the U.S. because we're a Republic, not a Democracy. He

suggested that she deliver a message from him to Boutros Boutros-Ghali, that

as went the League of Nations, so will go the UN. Tom said that he was

impressed that the UN knew anything about the Michigan Militia and that they

were concerned. Madame Speaker seemed to be somewhat rattled at the

unexpected turn of events. Her last comment to Tom was that many countries

wanted the U.S. out of the UN, at which point he realized that they had both

hit common ground in a very short exchange of views.

        Later, Tom commented to me that the one thing that really bothered

him was that at this meeting, held in a Christian Church, there was no

mention or God or Jesus.





UN Day (Yes, Again!)



        I will continue to remind you of the protest to be held in Lansing on

October 24, 1996.

        We are still in desperate need of donations and volunteers if this is

to be a success. If you would like to donate or volunteer time, contact

Michigan Militia Corps state command at (616)788-4754.

        It is earnestly recommended that everyone who was there last year be

there again this year. They will have the opportunity to see if they were

filmed (illegally) by the security cameras last year and those who can be

identified on film can become parties to the class action law suit that will

be filed on their behalf.