July 1, 1933 - Editorial - Why Not Issue Money?, by George Lorimer
However wisely President Roosevelt uses, or refrains from using, the great inflationary powers conferred on him by Congress, the mere passage of such legislation has stimulated the output of monetary and currency panaceas. In Congress, in general conversation and in letters written to newspapers, the idea crops up again and again that the way out of financial difficulties and economic problems is to issue more money. Especially is the suggestion made that the Government pay off interest-bearing debts with its own paper currency, thus saving interest, defying greedy bankers and at the same time putting money into circulation.
Such suggestions are made seriously and in connection with all manner of desirable adjustments and reforms. One proposal is that public works be paid for in this manner; another is that the heavy burden of mortgages upon farms and homes be lightened by the Government through the use of currency issues. The general principal is applicable in many directions; it is not the application which is at fault but the principle itself. As such, it is just as sound as the theory that two and two make one hundred.
A facile, voluminous and widely known writer for the newspapers suggests that the Government pay for public works with its new money and thus "get off the nonsense basis of going through the motions of borrowing and paying interest." Concededly, borrowing is a process which can be overdone or even greatly abused. But to suppose that governments borrow to raise money, instead of merely issuing the money, only because selfish bankers have taught and persuaded them, is juvenile. Borrowing has the advantage of carrying its own penalty; not only principal but interest must be paid, and a market must be found and respectfully treated. All this puts necessary restraints upon a government's process of raising money; the brake is painful in its operation, but it works, and if there were no brake, nations would simply blow up.
If governments can finance whatever they desire merely by issuing paper currency, then labor and toil have left the world. No one would need to work for a living anymore; paper money would take the place of work. Stated this way, the whole idea is preposterous, but it is almost as illogical when put in its milder form - namely, that what the country needs is plenty of money. In actual, everyday dealings we all value money, not because it is plentiful but for precisely the opposite reason - because it is scarce. If the Government puts out money to pay for any and every desirable cause, then the man who had done a hard day's labor will not accept it. He wants an equivalent return in money for his toil, and he cannot get it in the kind of money which is freely issued.
If this were not a statement of fact, if it were a mere assumption, the whole course of history would be different. If the principle of paying government expenses out of currency is sound, it would apply in times of prosperity as well as in those of depression. In that case, governments would long ago not only have abandoned the burden of borrowing but they would have given up the even more irksome practice of taxing their citizens year after year. The fact that they did not do so shows that values could not be created by fiat and that no one had yet discovered perpetual motion.
Neither Congress nor any other body can create values by mere say-so, nor has the world yet learned to do without labor and sacrifice. (pg. 22)
Comments: This editorial was quoted in full. Lorimer used logic and common sense in his writings. Ms. Thompson, in her June 24th article on the Hitler revolution in Germany, also stated that "Civilized people in and out of Germany dismissed Adolf Hitler lightly, because he did not in any sense fulfill their aesthetic ambitions of a leader." Ms. Thompson analyzed Hitler and the National Socialist movement "from an intellectual standpoint, asking whether the thesis they presented was true." But she saw that logic, common sense and truth didn't matter. What mattered was what appealed to the masses. We shall see that Lorimer's appeal to logic and common sense was in vain when it came to most people. What he was saying was not what they wanted to hear. Note that Lorimer stated that a worker "wants an equivalent return in money for his toil..." Look at your paycheck. Are you getting an equivalent return in money for your toil? Or are you getting an allowance? But, then again, this is not what most people want to hear because it shatters their illusion of freedom.