Home / Congress / Why Conservatives Accept High Taxes, the Federal Reserve System, and Fiat Money
Print Friendly and PDF

Why Conservatives Accept High Taxes, the Federal Reserve System, and Fiat Money

Written by Gary North on April 19, 2013

Gary North’s Reality Check

Recently, I wrote an article in which I argued that there are three political foundations of modern warfare: high graduated tax rates, a central bank, and the abolition of the gold coin standard. I called it “The Triumvirate of Modern Warfare.”

From the day that Ron Paul was sworn in as a Congressman in 1976, his critics inside Congress were consistent. They opposed his position on foreign relations and defense. He opposed the expansion of the American Empire. He wanted a strictly defensive system of military expenditures. He did not approve of the constant meddling of the American government in the domestic policies of other nations. So, he was criticized by conservatives inside Congress as being soft on Communism, or being naïve about the necessity of an aggressive foreign-policy, or by being anti-defense.

These same conservatives regarded themselves as hard-core opponents of the modern welfare state. But the modern welfare state is also supported by the three pillars of the modern warfare state, namely, high marginal tax rates, the central bank, and the abolition of the gold coin standard. The structure of all modern governments favors the expansion of the warfare state and the welfare state.


Some of these elected conservatives said they were in favor of the older gold standard, which was a fake gold standard, which Nixon abolished unilaterally on August 15, 1971. They also said that they wanted lower taxes. They said nothing about the Federal Reserve System.

When it came to their voting records on military affairs, these elected conservatives voted in favor of policies that could only be enforced by means of a highly graduated taxation, central bank inflation, and the abolition of the gold coin standard. No matter what they said about their supposed commitment to conservative fiscal principles and conservative monetary principles, what they voted for when it came time to vote for the funding of the Pentagon was this agenda: high graduated taxes, the central bank, and the abolition of the gold coin standard.

People wonder why it is that elected conservatives cannot seem to understand that marginal tax rates are too high in the United States. They also do not seem to understand that the restoration of a full gold coin standard is mandatory if we are ever to stop the expansion of the modern welfare state. The Federal Reserve System must be privatized. All of its legal connections with the federal government must be abolished. That is what Andrew Jackson did in 1836 with the Second Bank of the United States, and within a few years, that bank was bankrupt. It could not be sustained apart from a monopoly granted to it by the federal government. This is equally true of the Federal Reserve System.

When you see conservatives voting for a larger Pentagon budget than they voted for last year, you can be sure that these conservatives are not ready to vote for reduced tax rates, the abolition of the Federal Reserve System, and the restoration of a full gold coin standard. They are therefore also not willing to take the only stands that could undermine the modern welfare state.


Welfare state Democrats are willing to vote for an aggressive foreign-policy and a larger Pentagon budget, as long as they get to maintain the federal government’s high expenditures on welfare projects. Similarly, conservative Republicans are willing to vote for the welfare state projects, as long as the Democrats continue to fund the Pentagon.

(For the rest of my article, click the link.)

Continue Reading on www.garynorth.com

Print Friendly and PDF

Posting Policy:
We have no tolerance for comments containing violence, racism, vulgarity, profanity, all caps, or discourteous behavior. Thank you for partnering with us to maintain a courteous and useful public environment where we can engage in reasonable discourse. Read more.

11 thoughts on “Why Conservatives Accept High Taxes, the Federal Reserve System, and Fiat Money

  1. The kingdom of God cannot be 'voted in' by man. Man is evil, and his nature is that of satan. The voting record proves this to be the case. Those that run this world of of satan, but a new world is coming where it will be ruled by Christ and the elect, the converted of God, and in those days, there won't be any more wars, 'pentagons' run by devils, or taxation to support the evil system.

  2. msjallen says:

    You are absolutely right. No human being can solve our problems – only the Lord Jesus Christ – He controls our history and our individual destiny. Our responsibility is to continue to grow spiritually through the teaching of His Word and watch what God can do. Apparently, no human is being able to change things in WDC.
    II Peter 3:8… but grow in the grace and knowledge of our Lord and Savior Jesus Christ. To Him be the glory, both now and to the day of eternity.

  3. freedindeed says:

    And that actually is our only hope. Thankfully it is a sure one.

  4. G. Kuhns says:

    In other words there isn’t really a dime’s worth of difference between a Republican and a Democrat. One wants to control the economy, one wants to control morality, and both want to expand empire. The result: government grows and liberty dies.

  5. Bob Marshall says:

    Karl Marx was the author of the plan to use the graduated income tax and the central bank to destroy the wage earning middle class. It was Senator Nelson Aldrich who introduced the legislation in the congress that gave America both the graduated income tax . This became the 16th amendment to the Constitution. Colonel Edward Mandel House in his book, Philip Dru, Administrator predicted the enactment of the graduated income tax, profits excess tax, unemployment insurance, social security and the flexible currency system. House arranged for Wilson to become president since he had agreed to sign the bill creating the federal reserve.Wilson later said, House's "thoughts and mine are one." House was also involved in making FDR the president of the United States. The 1913 1040 form consisted of four pages. One was a page of instructions.

  6. Gary North appears to be the modern version of the mythical chimera monster with its dissimilar body parts–a lion's head, a goat's body, and serpent's tail–in other words, a libertarian. Only a libertarian would make support of special entitlements the moral equivalent of support for a strong military.

    North claims that uncomprehending conservatives in Congress opposed then Congressman Ron Paul because, among other things, libertarian Paul "did not approve of the constant meddling of the American government in the domestic policies of other nations." In light of recent and past events, would North recommend we simply ignore a Muslim takeover of Europe, no matter what that predicted for America?

    Does North not realize that World War II, the brutal slaughter of millions of people, and the postwar rise of communism could have been avoided if Britain and France had earlier "meddled" in the domestic policies of Nazi Germany?

    North also displays a serious lack of scholarship by making such absolute, blanket statements as "The structure of all modern governments favors the expansion of the warfare state and the welfare state."

    Perhaps North is more like another mythical creature, the 9-headed hydra, because it's obvious that he cannot get his heads together.

  7. Nice job of building your little straw men and knocking them down. Congratulations.

  8. donjusko says:

    EER, learn the difference between liberal and libertarian. Gary North is a liberal, ie, Contra, the Georgia airstrip where he was making money bringing in coke. Not all GOP are considered conservative, before Ron Paul you could say the Dem's and GOP were two wing of a vulture, but we are bringing in libertarian members. True our first try with Boehner didn't work, he lied and can be considered a turncoat. We are still electing good people to replace the elitists. RP's words, follow the Constitution, stop the illegal wars, bring the troops home, protect our borders, protect our personal, State and National sovereignty. Give us tangible money, audit the Federal Reserve Bank and stop spending money we don't have, these words still stand true.

    Don't try to give Libertarians a bad name by confusing them with liberals, that's the lefts favorite way of getting what they want. We will put a stop to: Big Government, Big Banking, Big Business, Big Pharma, Big Biotech and Big Media. We wont allow the UN to replace our Constitution. And while I'm at it, teapartyeconomist.com, you are not helping matters with a headline that states a lie at the get-go. "Why conservatives accept high taxes, etc.", the fact is we don't and you know it.

  9. Republicans definitely do accept high taxes, though not sure its fair to confuse them with conservatives. Almost as unfair as confusing Democrats with classical liberals.

  10. I consider excessive taxation – over about 12% total – as treason, despise the Federal Reserve and promote its dissolution, and condemn 'Porkulus' (fiat-money 'stimulus' programs). I consider myself somewhat conservative but closest to Libertarian ideals, and reject both the liberal 'big government' ideal and the feudal tyranny extreme. I despise RINOs (any Repub who voted for PPACA or stupid gun laws), most Democrats (there are a few with hunting licenses and respect for the Constitution that I tolerate), the anti-gun lobby, the liberal-retard slanted media channels, and PPACA. There you go…

  11. Seymour Kleerly says:

    Yikes! Didn't Jesus Christ die almost 2000 years ago?