National Emergency Employment Defense Act of 2011’. HR-2990 | Federal Reserve System | Money

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  To create a full employment economy as a matter of national economic defense; to provide for public investment in capital infrastructure; to provide for reducing the cost of public investment; to retire public debt; to stabilize the Social Security retirement system; to restore the authority of Congress to create and regulate money, modernize and provide stability for the monetary system of the United States; and for other public purposes. Mr. KUCINICH (for himself and Mr. CONYERS) introduced the following bill; which was referred to the Committee on Financial Services
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  1 Sep 21, 2011 - Introduced in House. This is the srcinal text of the bill as it was written by its sponsor andsubmitted to the House for consideration. This is the latest version of the bill currently available onGovTrack.HR 2990 IH112th CONGRESS1st SessionH. R. 2990To create a full employment economy as a matter of national economic defense; to provide for publicinvestment in capital infrastructure; to provide for reducing the cost of public investment; to retire publicdebt; to stabilize the Social Security retirement system; to restore the authority of Congress to create and   regulate money, modernize and provide stability for the monetary system of the United States; and for   other public purposes.IN THE HOUSE OF REPRESENTATIVES September 21, 2011 Mr. KUCINICH (for himself and Mr. CONYERS) introduced the following bill; which was referred to theCommittee on Financial ServicesA BILLTo create a full employment economy as a matter of national economic defense; to provide for publicinvestment in capital infrastructure; to provide for reducing the cost of public investment; to retire publicdebt; to stabilize the Social Security retirement system; to restore the authority of Congress to create andregulate money, modernize and provide stability for the monetary system of the United States; and forother public purposes. Be it enacted by the Senate and House of Representatives of the United States of America inCongress assembled,   SECTION 1. SHORT TITLE. This Act may be cited as the ‘National Emergency Employment Defense Act of 2011’. SEC. 2. FINDINGS; PURPOSES. (a) Findings- The Congress finds as follows:(1) Nearly 14,000,000 Americans are currently unemployed, another 12,000,000 estimatedAmericans are underemployed, wages are stagnant and millions of Americans are beingasked to take pay cuts.(2) Over 43,000,000 Americans live below the poverty line, 49,000,000 of Americans go tobed hungry at night, and an estimated 3,000,000 Americans are homeless.(3) Over 1,500,000 non-business bankruptcies were filed in calendar year 2010, thehighest number in five years, and the index of small business optimism is at a low not seenin nearly two decades.   (4) More than 2,000,000 homes are in foreclosure and millions of homeowners are falling   behind in their mortgage payments; the housing market in terms of construction and saleshas undergone an historic decline; and the declining value of housing means Americans’    largest single investment, the home, is no longer a safe harbor for savings, nest eggs,social mobility or the transfer of generational wealth.(5) Notwithstanding passage of the Patient Protection and Affordable Care Act, a privatizedhealth care system has made quality health care beyond the reach of most Americans.  2 (6) The cost of higher education has put higher academic attainment outside the reach of millions more young Americans, and the current generation of young Americans will not beable to attain the quality of life of their parents, reversing a long-standing trend.(7) The American Society of Civil Engineers has estimated that there is $2.2 trillion inunmet infrastructure needs. Cities and States, urban and rural areas all have an urgentneed to rebuild and repair roads, bridges, railroads, water systems, sewer systems and   other infrastructure but lack the necessary funds, bond-issuing capacity and other needswhich has led to America’s infrastructure falling into disrepair.(8) The Board of Governors of the Federal Reserve System have compounded the economic   crisis by failing to take decisive action to move the economy forward, Wall Street, whichwas bailed out by the American people, is not investing its rising assets in Main StreetAmerica, and individual investors are beginning to turn away from the stock market.(9) Some banks, many of which received government bailouts, are not investing in smallbusinesses, nor in the creation of jobs, the private sector is not creating jobs, and in factmost businesses are freezing their employment levels.   (10) Congress is stymied by competing forces: a desire to put people to work and an   aversion to borrowing money to create programs to do so.(11) Confidence in the United States’ economic leadership at home and around the world is   waning, the value of our currency cannot be securely maintained, and no other path toeconomic recovery exists which will create the changes necessary to put people back towork, invest in rebuilding America’s infrastructure, i.e. highway, rail, airport, harbors, lightrail, communication, shipping, water, sewer, education, and civil defense.(12) The aforementioned conditions require comprehensive action by the United States   Congress to create full employment, invest in America and secure our Nation’s long-term   economic, social and political future; and that such action is within our Constitutional rightand responsibility.(13) The authority to create money is a sovereign power vested in the Congress underArticle I, Section 8 of the Constitution.(14) The enactment of the Federal Reserve Act in 1913 by Congress effectively delegatedthe sovereign power to create money, to the Federal Reserve system and private financialindustry.(15) This ceding of Constitutional power has contributed materially to a multitude of    monetary and financial afflictions, including:   (A) growing and unreasonable concentration of wealth;(B) unbridled expansion of national debt, both public and private;(C) excessive reliance on taxation of citizens for raising public revenues;(D) devaluation of the currency;(E) drastic increases in the cost of public infrastructure investments;(F) record levels of unemployment and underemployment; and   (G) persistent erosion of the ability of Congress to exercise its Constitutionalresponsibilities to provide resources for the general welfare of all the Americanpeople.   (16) A debt-based monetary system, where money comes into existence primarily throughprivate bank lending, can neither create, nor sustain, a stable economic environment, buthas proven to be a source of chronic financial instability and frequent crisis, as evidencedby the near collapse of the financial system in 2008.(17) Banks increased their value by lending money imprudently, which greatly inflated thevalue of bank holdings, exposing depositors and taxpayers to the risks of schemes like the   bundling of subprime mortgages, and ultimately bringing undercapitalized banks and the   entire financial system to the edge of ruin, creating circumstances where the taxpayers of the United States were called upon to save the banks from their own imprudent lending   practices, misspending and mis-investments. The banks’ ability to create money out of nothing ultimately became the taxpayers’ liability, and raises a fundamental question abouta practice of money creation which threatens the wealth of the American people.(18) Abolishing private money creation can be achieved with minimal disruption to currentbanking operations, regulation, and supervision.   (19) The creation of money by private financial institutions as interest-bearing debts should   cease once and for all.(20) Reclaiming the power of the Federal Government to srcinate money, and to spend orlend money into circulation as needed, eliminates the need to treat money as a Federalliability or to pay interest charges on the Nation’s money supply to financial institutions; italso removes the undue influence of private financial institutions over public policy.  3 (21) Under the current Federal Reserve System, the persons responsible for the conduct of United States monetary policy have been unaccountable to the Congress and the Nation,have resisted auditing by the Government Accountability Office, and have claimedexemptions from some Federal statutes, including the Civil Rights Act of 1964, that applyto all agencies of the Federal Government.(22) The implementation of United States monetary policy by the Board of Governors of    the Federal Reserve System has failed to promote full employment, and the failure of theBoard of Governors to safeguard the financial system against wholesale fraud and abuse of citizens, demonstrates the risks of maintaining a system wherein the power to create and   regulate money has been delegated to private individuals who are unaccountable to thePeople of the United States in any way, even through their representatives in Congress.(23) An examination of the historical record demonstrates that the exercise of control bythe United States Government over the money system has provided greater moderation inthe supply of money and promoting the general welfare, and has been indispensable intimes of national emergency for generating resources required to support public   investment, provide for national defense, and promote the general welfare, and is therefore   superior to private control over the money system.(24) As our money system is a key pillar in maintaining general economic welfare and as   the Federal Reserve System and its private banking partners has consistently failed topromote or preserve the general welfare, it is essential that Congress, in the name of protecting the economic lives of the American people and the long-term security of ourNation, reassume the powers and responsibilities granted to it by the Constitution.(b) Purposes- The purposes of this Act are as follows:   (1) To create a Monetary Authority which shall pursue a monetary policy based on the   governing principle that the supply of money in circulation should not become inflationary   nor deflationary in and of itself, but will be sufficient to allow goods and services to movefreely in trade in a balanced manner. The Monetary Authority shall maintain long rungrowth of the monetary and credit aggregates commensurate with the economy’s long runpotential to increase production, so as to promote effectively the goals of maximumemployment, stable prices, and moderate long-term interest rates.(2) To create a full employment economy as a matter of national economic defense; toprovide for public investment in capital infrastructure; to provide for reducing the cost of    public investment; to retire public debt; to stabilize the Social Security retirement system;   to restore the authority of Congress to create and regulate money, to modernize andprovide stability for the monetary system of the United States, and for other publicpurposes.(3) To abolish the creation of money, or purchasing power, by private persons throughlending against deposits, by means of fractional reserve banking, or by any other means.(4) To enable the Federal Government to invest or lend new money into circulation as   authorized by Congress and to provide means for public investment in capitalinfrastructure.(5) To incorporate the Federal Reserve System into the Executive Branch under the United   States Treasury, and to make other provisions for reorganization of the Federal ReserveSystem.(6) To provide for an orderly transition.(7) To make other provisions necessary to accomplish the purposes of this Act. SEC. 3. DEFINITIONS. (a) In General- For purposes of this Act, the following definitions shall apply:(1) BUREAU- The term ‘Bureau’ means the Bureau of the Federal Reserve established   undersection 314 of title 31, United States Code,as added by section 303.   (2) DEPOSIT- The term ‘deposit’--   (A) has the meaning given such term in section 3(l) of the Federal DepositInsurance Act); and(B) includes--(i) a member account (as defined in section 101(5) of the Federal CreditUnion Act) in a credit union; and(ii) any transaction account.(3) DEPOSITORY INSTITUTION- The term ‘depository institution’--   (A) has the same meaning as in section 3 of the Federal Deposit Insurance Act;   and(B) includes any credit union (as defined in section 101 of the Federal Credit UnionAct).  4 (4) INSTRUMENT OF INDEBTEDNESS OF THE UNITED STATES; TREASURY INSTRUMENTS-The terms ‘instrument of indebtedness of the United States’ and ‘Treasury instrument’ include any obligation issued under subchapter I of chapter 31 of title 31, United StatesCode.(5) MEMBER BANK- The term ‘member bank’ has the same meaning as in the first sectionof the Federal Reserve Act.(6) MONEY- The term ‘money’ refers to United States Money, as established under title I.(7) MONETARY AUTHORITY- The term ‘Monetary Authority’ means the Monetary Authorityestablished under section 302.(8) SECRETARY- The term ‘Secretary’ means the Secretary of the Treasury.(9) STATE- The term ‘State’ has the same meaning as in section 3 of the Federal DepositInsurance Act.(10) EFFECTIVE DATE- The term ‘effective date’ means the date determined and publishedin the Federal Register by the Secretary, during the 90-day period beginning on the date of the enactment of this Act, that--(A) is not less than 1 year after such date of enactment and not more than 2 years   after such date; and(B) is the date on which the designated provisions of this Act take effect.   (b) Technical and Conforming Amendment to the FDIA- Section 3(l) of the Federal DepositInsurance Act (12 U.S.C. 1813(l))is amended by adding at the end the following:    ‘Such term does not include any amount on which any interest is paid or which is received or heldby a bank or savings association pursuant to a loan agreement for a fixed term of time (asdetermined without regard to any designation on the agreement as a loan, certificate, or other   particular instrument).’.   SEC. 4. COORDINATION WITH OTHER LAW. (a) In General- This Act shall supersede any provision of Federal law in effect on the day before the   date of the enactment of this Act that is inconsistent with any provision of this Act but only to theextent of such inconsistency.(b) Technical and Conforming Amendments- Before the end of the 6-month period beginning onthe date of the enactment of this Act, the Secretary of the Treasury shall submit to the Congress aproposed draft of legislation of the Monetary Authority that, if enacted, would implement suchtechnical and conforming amendments as the Monetary Authority may recommend--(1) to repeal the provisions of law referred to in subsection (a) that are inconsistent withthis Act; and(2) to further clarify and implement the provisions of this Act.   TITLE I--ORIGINATION OF UNITED STATES MONEYSEC. 101. EXERCISE OF CONSTITUTIONAL AUTHORITY TO CREATE MONEY. (a) In General- Pursuant to the exercise by the Congress of the authority contained in the 5th   clause of section 8 of Article I of the Constitution of the United States of America--(1) the authority to create money within the United States shall hereafter reside exclusivelywith the Federal Government; and(2) the money so created shall be known as United States Money and denominated andexpressed as provided insection 5101 of title 31, United States Code.   (b) Exercise of Sovereign Power- The creation of United States Money under this Act is the legalexpression of the sovereign power of the Nation and confers upon its bearer an unconditionalmeans of payment.   (c) Limitation on Expression- Beginning on the effective date--   (1) only the coin, notes, or other forms of legal tender, including electronic currency,srcinated by the United States Treasury under the authority of this Act shall be deemed asUnited States money; and(2) it shall be unlawful for any person to designate any credit, note, bond, script or otherfinancial instrument as United States Money.   SEC. 102. UNLAWFUL FOR PERSONS TO CREATE MONEY. Any person who creates or srcinates United States money by lending against deposits, through so-   called fractional reserve banking, or by any other means, after the effective date shall be finedunder title 18, United States Code, imprisoned for not more than 5 years, or both.   SEC. 103. PRODUCTION OF UNITED STATES MONEY. (a) Commencing Full Production of United States Currency-Section 5115 of title 31, United States   Code,is amended by striking subsections (a) and (b) and inserting the following new subsections:    ‘(a) In General- In order to furnish suitable notes for circulation as United States money, theSecretary of the Treasury shall cause plates and dies to be engraved in the best manner to guard
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