Nadia Hussain Pakistani Actress

The Hidden Truth about Income Taxes

American citizens and permanent resident aliens, living and working within the States of the Union are not subject to the filing of an IRS Form 1040 and ARE NOT LIABLE for the payment of a tax on "income"!!! If this surprises you, you are not alone. You are among the vast majority of American citizens who have been mislead and misinformed. Read on.

For YEARS, the Internal Revenue Service has ruled the American people with fear, bluff, and deception, the IRS's major weapons. Americans have been led to believe that they "owe" an income tax on their earnings; that it is their "patriotic duty" to pay it, and there is no alternative to the IRS's abuse. Nothing could be further from the truth! From its beginning, the income tax was levied on non-resident aliens and American citizens living and working in a foreign country and for the federal government. During World War I, the government requested that citizens volunteer to pay taxes as a way to pay for the war. During World War II the government employed Walt Disney and his cartoon character, Donald Duck, to increase the voluntary payment of the income tax. Consider the following facts:

Our Founding Fathers created a constitutional republic as our form of government. The Constitution gives the federal/national government limited powers. All powers not delegated to the United States are reserved to the States respectively or to the People. The Union was created to be the servant of the people! The United States Constitution is the supreme law of the land. (Article VI, Clause 2.)

The Constitution gives the Congress the power to lay and collect taxes to pay the debts of the government and to provide for the common defense and general welfare of the United States. Congress is only permitted to levy two types of taxes.

1. DIRECT TAXES, which are subject to the rule of apportionment among the states of the Union.

2. INDIRECT TAXES -- imposts, duties and excises, subject to the rule of uniformity.

The US Constitution does not allow the federal government to use either of the two classifications to tax CITIZENS or PERMANENT RESIDENT ALIENS of the United States of America, DIRECTLY. The intent of the Founders was to keep the government the servant and to prevent it from becoming the master. (See Article 1, section 2, clause 3 of the U.S. Constitution.)

A federal census is taken every ten (10) years to determine the number of representatives to be allotted to each State and the amount of a direct tax that may be apportioned to each State. This is determined by the percentage its number of representatives bears to the total membership in the House of Representatives. (Article 1, section 2, clause 3; Article 1, section 9, clause 4.)

It was established in the Constitutional Convention of 1787 that the Supreme Court of the United States would have the power of "judicial review". This is the power to declare laws passed by the U.S. Congress to be null and void if such a law or laws was/were in violation of the Constitution. This was to be determined from the original intent as found in Madison's Notes recorded during the Convention, the Federalist Papers, and the ratifying conventions found in Elliott's Debates.

Due to the characteristics of the SECOND CLASSIFICATION of taxation, the Supreme Court called it an indirect tax and it is divided into three distinct taxes: IMPOSTS, DUTIES, and EXCISES. These taxes were intended to provide for the operating expenses of the government of the United States. (See Article 1, section 8, clause 1.)

Duties and imposts are taxes levied by government on things imported into the country from abroad, and are paid at the ports of entry.

The Supreme Court says that excises are...taxes laid upon the manufacture, sale or consumption of commodities within the country, upon licenses to pursue certain occupations and upon corporate privileges. (See Flint v. Stone Tracy Co., 220 US 107 [1911].)

In 1862, Congress passed an Act (law) to create an "Income Duty" to help pay for the War Between the States. A duty is an indirect tax, which the federal government cannot impose on citizens or residents of a State having sources of income within a State of the Union.

Congress passed an Act in 1894 to impose a tax on the incomes of citizens and resident aliens of the United States. The constitutionality of the Act was challenged in 1895 and the Supreme Court said the law was unconstitutional because it was a direct tax that was not apportioned as the Constitution required (See Pollock v. Farmer's Loan & Trust Co., 157 US 429 [1895].)

In 1909 Congress passed the 16th Amendment to the Constitution that was allegedly ratified by 3/4 of the States; it is known as "The Income Tax Amendment." Bill Benson has gathered the evidence that it was not legally ratified.

Some officials within the Internal Revenue "Service," along with professors, teachers, politicians and some judges, have said and are saying, that the 16th Amendment changed the United States Constitution to allow a DIRECT tax without apportionment.

However, the above persons are not empowered to interpret the meaning of the United States Constitution! As stated above, this power is granted by the Constitution to the Supreme Court, but limited to the original intent. The Supreme Court has no power to function as a "social engineer" to amend or alter the Constitution as they have been doing. A change or "amendment " can only be lawfully done according to the provisions of Article 5 of the US Constitution.

The U.S. Supreme Court said in 1916 that the 16th Amendment did not change the U.S. Constitution because of the fact that Article 1, section 2, clause 3, and Article 1, section 9, clause 4, were not repealed or altered; the U.S. Constitution cannot conflict with itself. The Court also said that the 16th Amendment merely prevented the "income duty" from being taken out of the category of INDIRECT taxation. (See Brushaber v. Union Pacific R.R. Co., 240 US, page 16.)

After the Supreme Court decision, the office of the Commissioner of Internal Revenue issued Treasury Decision [Order] 2313 (dated March 21, 1916; Vol. 18, January-December, 1916, page 53.) It states in part;

...it is hereby held that income accruing to nonresident aliens in the form of interest from the bonds and dividends on the stock of domestic change corporations is subject to the income tax imposed by the act of October 3, 1913.

In another Supreme Court decision in 1916, the Court, in clear language settled the application of the 16th Amendment. By the previous ruling [Brushaber] it was settled that the provisions of the Sixteenth Amendment conferred no new power of taxation. Rather it simply prohibited the previous complete and plenary [full] power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged... (See Stanton v. Baltic Mining Co., 240 US, 112.) And indirect taxes are limited to imposts, duties, and excises, not on the income of individuals.

The United States Constitution gives the federal government the exclusive authority to handle foreign affairs. Congress has the power to pass laws concerning the direct or indirect taxation of foreigners doing business in the U.S.A. It has possessed this power from the beginning, needing no "amendment" (change) to the U.S. Constitution to authorize the exercise of it.

The DIRECT classification of taxation was intended for use when unforeseen expenses or emergencies arose. Congress, needing funds to meet the emergency, can borrow money on the credit of the United States (Article 1, section 8, clause 2). The Founding Fathers intended that the budget of the United States be balanced and a deficit be paid off quickly and in an orderly fashion. Through a DIRECT tax, the tax bill is given to the States of the Union. The bill is "apportioned" by the number of Representatives of each State in Congress; therefore, each State is billed its apportioned share of the DIRECT tax equal to the number of votes its Representatives could employ to pass the tax. How the States raise the money to pay the bill is not a federal concern (Article 1, section 2, and clause 3).

In the Brushaber and Stanton cases, the Supreme Court said the 16th Amendment did not change income taxes to another classification. So, if the INCOME TAX is an indirect EXCISE tax, then how is it applied and collected? According to the Supreme Court, "Excises are taxes laid upon the manufacture, sale or consumption of commodities within the country, upon licenses to pursue certain occupations and upon corporate privileges; the requirement to pay such taxes involves the exercise of the privilege and if business is not done in the manner described no tax is payable...it is the privilege which is the subject of the tax and not the mere buying, selling or handling of goods." (Flint v. Stone Tracy Co., 220 US, 110.) In other words, if there is no privilege or licensing involved in a business, no tax is payable.

If all RIGHTS are the natural heritage of men and women, citizens of the States retain all RIGHTS except those surrendered as enumerated in the United States Constitution), and PRIVILEGES are granted by government after application; THEN what is the PRIVILEGE that the "income tax" is applied against?

As established in the U.S. Constitution, the federal government cannot directly tax a citizen living within one of the States of the Union. Citizens possess rights; these rights cannot be converted to privileges by government. The only individuals who would not have these rights and would therefore be liable to regulation by government are NONRESIDENT ALIENS doing business and working within the United States or receiving domestic source profits from investments, and United States citizens working in a foreign country and taxable under treaties between the two governments.

Withholding agents withhold income taxes. The only section in the Internal Revenue Code that defines this authority is section 7701(a)(16). Withholding of money for income tax purposes, according to section 7701(a)(16), is only authorized for sections:

· 1441 - NONRESIDENT ALIENS,

· 1442 - FOREIGN CORPORATIONS,

· 1443 - FOREIGN TAX-EXEMPT ORGANIZATIONS,

· 1461 - WITHHOLDING AGENT LIABLE FOR WITHHELD TAX.

Internal Revenue Manual Chapter 1100 Organization and Staffing, section 1132.75 states: The Criminal Investigation Division enforces the criminal statutes applicable to income, estate, gift, employment, and excise tax laws involving United States citizens residing in foreign countries and nonresident aliens subject to Federal income tax filing requirements...

The implementation of IRS Treasury Regulation 1.1441-5 is explained in Publication 515 on page 2, that "If an individual gives you [the domestic employer or withholding agent] a written statement, in duplicate, stating that he or she is a citizen or resident of the United States, and you do not know otherwise, you may accept this statement and are relieved from the duty of withholding the tax.

The ONLY way a United States citizen or permanent resident alien, living and working within a State of the Union can have taxes deducted from his/her pay, is by

· voluntarily filing an application Form SS-5 to obtain a Social Security Number.

· Then by entering that number on an IRS Form W and signing it to permit withholding of "Employment Taxes" -- "Form W Employee's Withholding Allowance Certificate" (emphasis added).

That is why the IRS pressures children to apply for a Social Security Numbers, and for employers to obtain the voluntary completion of Form W immediately from all those being hired. However, no federal law or regulation requires workers to have a Social Security Number or sign a Form W to qualify for a job.

Internal Revenue Code Section 6654(e)(2)(c) states:...no tax liability...if....the individual was a citizen or resident of the United States throughout the preceding taxable year. IRS contends the success of the SELF-ASSESSMENT system depends on VOLUNTARY COMPLIANCE

All human rights are natural and cannot be taken away by any legitimate means. This is the premise of the Declaration of Independence. The United States Government can only exercise powers given to it by "We the People" through the U.S. Constitution. The "income tax" is an INDIRECT TAX. There is no section of law in the Internal Revenue Code (Title 26 USC) making a CITIZEN or a RESIDENT working and living WITHIN A STATE OF THE UNION, LIABLE to pay the INCOME (indirect/excise/duty) TAX.

Are you "self employed"? Did you know what the Internal Revenue Code says concerning filing quarterly estimated returns? Read below!

SEC. 6654. FAILURE BY INDIVIDUALS TO PAY ESTIMATED INCOME TAX.

(e) Exceptions. -Where tax is small amount. -- No addition to tax shall be imposed under subsection (a) for any taxable year if the tax shown on the return for such taxable year (or, if no return is filed, the tax), reduced by the credit allowable under section 31, is less than $500.


Where no tax liability for preceding taxable year.--No addition to tax shall be imposed under subsection (a) for any taxable year if:

A. the preceding taxable year was a taxable year of 12 months.

B. the individual did not have any liability for tax for the preceding taxable year, and

C. the individual was a citizen or resident of the United States throughout the preceding taxable year. (emphasis added)


What can you do about it? For one thing, require them to follow their own statutes and regulations. IRS is notorious for violating due process. Get a professional with 20 years experience helping people with tax problems. Click here to GET STARTED NOW!


Contact your congressman and senators to protest and demand hearings to investigate the unconstitutional structure and function of the Internal Revenue Service. You can find their name, address, email address, phone number or fax number at http://thomas.loc.gov . Tell your friends, send them the URL of this page, talk about it, tell your friends to tell their friends.


What else can you do? File your UCC-1 claim on the CORPORATION that carries your name in their ledgers and take control of your Treasury Direct Account. You are considered a citizen of a Federal territory because of Fourteenth Amendment citizenship. Since you have not objected to your status as a subject of the Federal jurisdiction, you may be presumed to be content with your Federal citizenship. To guide you through the legal brambles to freedom you will need the help of an experienced advisor. GET STARTED NOW!


FREE! 2300+ Page Research Report, "The Great IRS Hoax: Why We Don't Owe Income Tax"

Exhaustive overview of the income tax laws and regulations. Excellent legal research and documentation including specific legal cites, court decisions and procedural tools to help in dealing with the IRS. Includes legal opinion letters, information on employer/employee withholding, sample IRS response letters and an overview on strategies and tactics to handle tax situations. Includes transcripts of taxpayer audits with the IRS. (Special thanks to Chris Hansen)

Comprehensive Annual Financial Reports Exposed RealVideo (streaming) :: (37:01) The Biggest Game in Town exposes the two-tiered accounting of all federal, state, county governments. Find out how the issue is confused by focusing on the budget and not discussing the investments. There is no reason for continued taxation.

"Connecting the Dots." The basic flow of law showing WHY there is no income tax.


"Who Was Philander Knox?" Details about the man behind the most expensive fraud in history

MONEY & BANKS...THE HIDDEN TRUTH BEHIND GLOBAL DEBT

1) What is money... how is it created and who creates it?

2) Why is almost everyone up to their eyeballs in debt... individuals, businesses and whole nations?

3) Why can’t we provide for our daily needs - homes, furnishings cars etc. without borrowing?

4) How much could prices fall and wages increase if businesses did not have to pay huge sums in interest payments which have to be added to the cost of goods and services they supply...?

5) How much could taxes be reduced and spending on public services such as health and education be increased if governments created money themselves instead of borrowing it at interest from private banks…?

"If you want to be the slaves of banks and pay the cost of your own slavery, then let the banks create money…" Josiah Stamp, Governor of the Bank of England 1920.

WHAT IS MONEY....?

It is simply the medium we use to exchange goods and services.

Without it, buying and selling would be impossible except by direct exchange.
Notes and coins are virtually worthless in their own right. They take on value as money because we all accept them when we buy and sell.
To keep trade and economic activity going, there has to be enough of this medium of exchange called money in existence to allow it all to take place.
When there is plenty, the economy booms. When there is a shortage, there is a slump.
In the Great Depression, people wanted to work, they wanted goods and services, all the raw materials for industry were available etc. yet national economies collapsed because there was far too little money in existence.
The only difference between boom and bust, growth and recession is money supply.
Someone has to be responsible for making sure that there is enough money in existence to cover all the buying and selling that people want to engage in.
Each nation has a Central Bank to do this - in Britain, it is the Bank of England, in the United States, the Federal Reserve.
Central Banks act as banker for commercial banks and the government - just as individuals and businesses in Britain keep accounts at commercial banks, so commercial banks and government keep accounts at the Bank of England.
TODAY’S "MONEY"... CREATED BY PRIVATE INTERESTS FOR PRIVATE PROFIT.

"Let me issue and control a nation’s money, and I care not who writes it’s laws." Mayer Amschel Rothschild (Banker) 1790

Central banks are controlled not by elected governments but largely by PRIVATE INTERESTS from the world of commercial banking.
In Britain today, notes and coins now account for only 3% of our total money supply, down from 50% in 1948.
The remaining 97% is supplied and regulated as credit - personal and business loans, mortgages, overdrafts etc. provided by commercial banks and financial institutions - on which INTEREST is payable. This pattern is repeated across the globe.
Banks are businesses out to make profits from the interest on the loans they make. Since they alone decide to whom they will lend, they effectively decide what is produced, where it is produced and who produces it, all on the basis of profitability to the bank, rather than what is beneficial to the community.
With bank created credit now at 97% of money supply, entire economies are run for the profit of financial institutions. This is the real power, rarely recognised or acknowledged, to which all of us including governments the world over are subject.
Our money, instead of being supplied interest free as a means of exchange, now comes as a debt owed to bankers providing them with vast profits, power and control, as the rest of us struggle with an increasing burden of debt....
By supplying credit to those of whom they approve and denying it to those of whom they disapprove international bankers can create boom or bust and support or undermine governments.
There is much less risk to making loans than investing in a business. Interest is payable regardless of the success of the venture. If it fails or cannot meet the interest payments, the bank seizes the borrower’s property.
Borrowing is extremely costly to borrowers who may end up paying back 2 or 3 times the sum lent.
The money loaned by banks is created by them out of nothing – the concept that all a bank does is to lend out money deposited by other people is very misleading.
MONEY CREATED AS A DEBT

We don’t distinguish between the £25 billion in circulation as notes and coins (issued by the government) and £680 billion in the form of loan accounts, overdrafts etc. (created by banks etc,).
£100 cash in your wallet is treated no differently from £100 in your current account, or an overdraft facility allowing you to spend £100. You can still buy goods with it.
In 1948 we had £1.1 billion of notes and coins and £1.2 billion of loans etc. created by banks – by 1963 it was £3 billion in cash and £14 billion bank created loans etc.
The government has simply issued more notes and coins over the years to cover inflation, but today’s £680 billion of bank created loans etc. represents an enormous increase, even allowing for inflation.
This new "money" in the form of loans etc, which ranks equally with notes and coins – how has it come into existence?
"The process by which banks create money is so simple that the mind is repelled." Professor. J. K. Galbraith

This is how it’s done…. a simplified example...

Let’s take a small hypothetical bank. It has ten depositors/savers who have just deposited £500 each.
The bank owes them £5000 and it has £5000 to pay out what it owes. (It will keep that £5000 in an account at the Bank of England – what it has in this account are called its liquid assets).
Sid, an entrepreneur, now approaches the bank for a £5000 loan to help him to set up a business.
This is granted on the basis of repayment in 12 months - plus 10% interest – more on that later.
A new account is opened in Sid’s name. It has nothing in it, nevertheless the bank allows Sid to withdraw and spend £5000.
The depositors are not consulted about the loan. They are not told that their money is no longer available to them– The amounts shown in their accounts are not reduced and transferred to Sid’s account.
In granting this loan, the bank has increased its obligations to £10,000. Sid is entitled to £5000, but the depositors can still claim their £5000.
If the bank now has obligations of £10,000, then isn’t it insolvent, because it only had £5000 of deposits in the first place? Not exactly..
The bank treats the loan to Sid as an ASSET, not a liability, on the basis that Sid now owes the bank £5000.
The bank’s balance sheet will show that it owes its depositors £5000, and it is now owed £5000 by Sid. It has created for itself a new asset of £5000 in the form of a debt owed by Sid where nothing existed before - this on top of any of the original deposits still in its account at the Bank of England. - it is solvent - at least for accounting purposes!
(At this stage the bank is gambling that as Sid is spending his loan, the depositors won’t all want to withdraw their deposits!)
The bank had a completely free hand in the creation of this £5000 loan which, as we shall see, represents new "money", where nothing existed before. It was done at the stroke of a pen or the pressing of a computer key.
The idea that banks create something out of nothing and then charge interest on it for private profit might seem pretty repellent. Anyone else doing it would be guilty of fraud or counterfeiting!
New "money" into the economy...

Sid’s loan effectively becomes new "money" as it is spent by him to pay for equipment, rent and wages etc. in connection with his new business.
This new "money" is thus distributed to other people, who will in turn use it to pay for goods and services - soon it will be circulating throughout the economy.
As it circulates, it inevitably ends up in other people’s bank accounts.
When it is paid into someone’s account which is not overdrawn, it is a further deposit - Sid pays his secretary £100 and she opens an account at our hypothetical bank – it now has £5100 of deposits.
If we assume for a moment that the remaining £4900 ends up in the accounts of the original depositors of our hypothetical bank, it now has another £4900 in deposits - £10000 in total if the depositors have not touched their original deposits. In practice much of it would end up in depositors accounts at other banks, but either way there is now £5000 of new "money" in circulation.
Thus in reality, all deposits with banks and elsewhere actually come from "money" originally created as loans – (except where the deposits are made in cash – more on cash very shortly).
If you have £500 in your bank account, the fact is someone else like Sid went into debt to provide it.
The key to the whole thing is the fact that :-

Cash withdrawals account for only a tiny percentage of a bank’s business.
Bank customers today make almost all payments between themselves by cheque, switch, direct debit or electronic transfer etc. Their individual accounts are adjusted accordingly by changing a few figures in computer databases – just book keeping entries. No actual money/cash changes hands. The whole thing is basically an accounting process that takes place within the banking system.
THE ROLE OF CASH

The state is responsible for the production of cash in the form of notes and coins.
These are then issued by the Bank of England to the high street banks - the banks buy them at face value from the government to meet their customers’ demands for cash.
The banks must pay for this cash and they do so out of what they have in the accounts which they hold at the Bank of England – their liquid assets. Their accounts are debited accordingly.
The state (through the Treasury) also keeps an account at the Bank of England which is credited with the face value of the notes and coins as they are paid for by the banks. (This is now money in the public purse available for spending on public services etc.)
This is how all banks acquire their stocks of notes and coins, but the cash a bank can buy is limited to the amount it holds in its account at the Bank of England – its liquid assets.
As this cash is withdrawn by banks’ customers, it enters circulation in the economy.
Unlike bank created loans etc, cash is interest free and can circulate indefinitely.
NON CASH PAYMENTS - Book keeping entries

With so little cash being withdrawn, and from experience knowing that large amounts of deposits remain untouched by depositors for reasonable periods of time, banks just hope that their liquid assets will be sufficient to enable them to buy up the cash necessary to meet the relatively very small amounts of cash that are normally withdrawn.
A bank has serious problems if demands for cash withdrawals by depositors, and indeed borrowers who want to draw some of their loans in cash, exceed what the bank holds in its account at the Bank of England.
In practice it would probably try to get a loan itself from the Bank of England or another bank, to tide itself over. Failing that it would have to call in some loans and seize the property of borrowers unable to pay.
DEPOSITORS’ CLAIMS AGAINST BANKS …

Once you have made a deposit at the bank (in cash or by cheque), all you then have is a claim against the bank for the amount in your account. You are simply an unsecured creditor. Your bank statement is a record of how much the bank owes you. (If you are overdrawn, it is a record of what you owe the bank). It will pay you what it owes you by allowing you to withdraw cash, provided it has sufficient cash to do so.
If customers are trying to withdraw too much cash, this is a run on the bank, which will soon refuse further withdrawals. So it’s first come first served!
Should you want to make a payment by cheque, this is less likely to be a problem – you are simply transferring part of your claim against the bank to someone else – the person to whom your cheque is payable - just a book keeping entry.
If the person to whom your cheque is payable has an account at the same bank as you do, the deposit stays with that bank – overall the bank is in exactly the same position as it was before.
I give you a cheque for £50 – we both have accounts in credit at Barclays – what Barclays owes me is reduced by £50, what Barclays owes you increases by £50 – but nothing has left Barclays – the total deposits or claims against Barclays remain the same…..
BANKS’ CLAIMS AGAINST EACH OTHER

….BUT if you keep your account at Lloyds, deposits at Barclays are reduced by £50, whilst deposits at Lloyds increase by £50.
Millions of transactions like this take place every day between customers of the various banks, using switch cards, direct debits, electronic transfers as well as cheques – deposits are therefore constantly moving between the banks.
All these cheques and electronic transfers pass through a central clearing house (which is why we refer to a cheque being "cleared").
The transactions are set off against one another, but at the end of each day, a relatively small balance will always be owed by one bank to another.
A bank must always be ready to settle such debts.
To do this, it makes a payment from its account at the Bank of England to the creditor bank’s account at the Bank of England.
Thus a bank faces claims from two sources (which it meets out of its liquid assets) – its customers wanting cash, and other banks when it has a clearing house debt to settle.

Unless all the banks are faced with big demands for cash at the same time, the banking system as a whole is safe, although an individual bank is vulnerable, should a large number of depositors for some reason withdraw their deposits in cash or transfer their deposits to other banks.

We now see how today the whole system is basically a book keeping exercise where millions of claims pass between the banks and their borrowers and depositors every day with relatively very little real money or cash changing hands – backed by tiny reserves of liquid assets.
The system is known as FRACTIONAL RESERVE BANKNG and banks are sometimes accurately referred to as dealers in debts.
Barclays Bank’s 1999 accounts illustrate the whole thing very well - it had loans owing to it of £217 billion, it owed £191 billion to its depositors – backed by just £2.2 billion in liquid assets!
A bank’s level of lending is geared to the amount of cash it has or can buy up – its liquid assets - rather than the amount of its customers’ deposits.
But if a bank can attract customers deposits from other banks, it will add to its liquid assets, as other banks settle the resulting clearing house debts in its favour – hence there is tremendous competition between banks to attract deposits.
Interest …. Big Profits for the bank...

Let’s now return to Sid – he has to pay our bank 10% interest on his loan - £500. These interest payments are money coming into the bank, they are profits and they end up in its account at the Bank of England - additional liquid assets for the bank.
It now has an extra £500 to meet its depositors’ withdrawals. If Sid manages to repay the original loan as well, it will have an extra £5500.
Our bank created for itself out of nothing an asset of £5000 in the form of a loan to Sid. It is no longer owed anything by Sid, but in repaying his loan with interest, Sid turned a mere debt into £5500 of liquid assets for the bank – a tidy profit for the bank…. and the basis on which more loans can be made.
Banks today risk creating loans 100 times or more in excess of their liquid assets as Barclays Bank’s 1999 accounts show – (see above).
Thus our bank will soon be making many more loans. Thus, the deposits it receives back will increase and so will interest payments and therefore profits.
With more loans and more deposits, there will be a greater demand to withdraw cash – but increasing profits means more cash can bought by the bank. (This is how the amount of cash in circulation has been increasing to reach £25 billion by 1997.)
It is a myth to think that when you borrow money from a bank, you are borrowing money that other people have deposited – you are not – you are borrowing the bank’s money which it created and made available to you in the form of a loan.
More debt for the rest of us....

Sid’s interest payments and any repayment of the loan itself to the bank means however that this "money" is no longer circulating in the economy.
Any payment into an overdrawn account reduces that overdraft. It operates as a repayment to the bank and the "money" is lost to the economy.
More money must be lent out to keep the economy going. If people don’t borrow or banks don’t lend, there will be a fall in the amount of money circulating, resulting in a reduction in buying and selling - a recession, slump or total collapse will follow depending on how severe the shortage is.
The increase in bank created loans over the years is additional conclusive proof that banks do create "money" out of nothing - £1.2 billion in 1948 up to £14 billion by 1963 up to £680 billion by 1997.
Today’s supply of notes and coins after taking inflation into account, has similar buying power to the supply in 1948 (£1.1 billion) but since then, there has been a ten fold plus increase in real terms in money supply made up of credit created by banks.
This has enabled the economy to expand enormously, and as a result living standards for many people have improved substantially.... but it has been done on borrowed money! What is credit to the bank is debt to the rest of us.
The banks are acquiring an ever increasing stake in our land, housing and other assets through the indebtedness of individuals, industry, agriculture, services and government - to the extent that Britain and the world are today effectively owned by them.
THE REPERCUSSIONS OF OUR DEBT BASED MONEY SYSTEM...

1) Goods and services are much more expensive...

The cost of borrowing by producers, manufacturers, transporters, retailers etc. all has to be added to the price of the final product.

2) Consumers’ have much less money to spend...

They are burdened by the cost of mortgages, overdrafts, credit cards, personal loans etc. As a result of 1) and 2) there is...

3) A surplus of goods and services...

...because the population overall can’t afford to buy up all the goods and services being produced. This in turn creates.....

4) Cut throat competition...

Businesses try to cut prices and costs to grab a share of this limited purchasing power in the economy, as illustrated by:

(i) Wages being held down as much as possible.

(ii) Shedding of jobs.

(These both reduce people’s spending power

even more.)

(iii) Retailers importing cheap products from

abroad where wages are much lower.

(iv) Production of cheaper goods that don’t last

as long.

(v) Protection of the environment a low priority.

(vi) Mergers and take-overs - corporations get

bigger and bigger, driven to search out new

markets.

(vii) Big companies shifting production to

poorer countries which have cheap non-

unionised labour and the least stringent

safety and environmental laws or....

(viii) Demanding large government subsidies and

tax free incentives as the price for setting up

new production or not relocating abroad.

5) Ever increasing indebtedness.

When a bank creates money by making a loan, it does not create the money needed to pay the interest on that loan.
The bank lent Sid £5000, but it demands £5500 back. Sid has to go out into the business world and compete and sell to get that extra £500 from his customers. It can only come from money already circulating in the economy - made up of loans other people have taken out – so soon someone will be left short of money and have to borrow more.
Thus the only way for interest payments to be kept up is for more loans to be taken out.
Although a few individuals and businesses may pay off their debts or get by without additional borrowing, OVERALL people and industry must keep borrowing MORE AND MORE to provide the money in the economy needed to keep up interest payments on the overall volume of debt.
The present level of debt at £680 billion means we are borrowing about £60 billion of new "money" into existence each year to pay the interest on it.
But people and industry can’t go on borrowing indefinitely - they will no longer be able to afford to, and will gradually stop borrowing more money into existence. When this happens, the economy will go into decline. The system thus contains the seeds of its own destruction.
When loan repayments and interest payments are made to banks, this is money taken out of circulation. If it went on indefinitely, in an economy where the money supply is largely made up of loans etc. created by banks, there would eventually be almost no "money" left in circulation and with it no economy.
Under the present system, if the economy is to be kept going, money must be constantly lent out again. It would be possible simply re-circulate the existing money supply without creating new money were it not for the fact that extra money is needed to cover interest payments and also to enable the economy to grow.
6) Inflation....

is guaranteed because producers constantly have to borrow more, and must add the cost of that increased borrowing to the price of the goods produced.

Why is it that when the moneylenders hike their prices (i.e. put up interest rates) this is supposed to reduce inflation?
It doesn’t....
It’s just that there is a delay in industry putting up prices.
Initially industry is forced to hold or even reduce its prices with profits down, or even sustaining losses in a desperate bid to sell its products in an economy where money available for spending is reduced because of higher interest payments being made to the banks.
Inflation may be held in check or even reduced temporarily, but eventually industry must put its prices up in order to recover these higher costs.
This most readily happens when interest rates come down, more people borrow, and money supply and consumer spending increases. Inflation then races ahead.
The fact that levels of borrowing/money creation have to keep on rising as already explained, adding to the overall burden of interest payments, guarantees that inflation will be present as long as we have an economy based on an increasing burden of debt.
EFFECTS ON INTERNATIONAL TRADE

Surplus goods in the national economy have to be disposed of somehow. The obvious way to do this is to try to export them!
The absurdity is that every nation is trying to do this, because of the same fundamental problem at home.
This creates frenzied competition in world markets and masses of near identical goods madly criss-crossing the globe in search of an outlet.
Instead of international trade being based on reciprocal mutually beneficial arrangements where nations supply each others’ genuine needs and wants, the whole thing becomes a cut-throat competition to grab market share in order to stay solvent in a debt based economy.
Big corporations demand unrestricted access to every nation’s market – so called "free" trade.
The European Union "single market", the North American Free Trade Agreement and the World Trade Organisation are the best examples of the drive to open up all national markets.
Exporting is good for a nation’s economy...

because when exported goods are paid for, this brings money into the exporting nation’s economy free of debt.

The money to pay for them was borrowed from banks in the importing nation.
That money is lost to the importing nation’s economy, but the debt that created that money still has to be repaid by the importer out of the remaining money in the importing nation’s economy.
If a nation can become a big net exporter, for a time it’s economy will boom with all the interest free money coming in - a trade surplus will exist.
Importing is not so good for a nation’s economy...

If some nations are building up trade surpluses in this way, others must be net importers and building up trade deficits.
Ultimately, those with big deficits can no longer afford to import, since so much money is sucked out of their economies leaving a proportionally increasing burden of debt behind.
THIRD WORLD DEBT AND THE INTERNATIONAL MONETARY FUND (IMF)

The IMF was set up to provide an international reserve of money supposedly to help nations with big deficits.
In practice it makes matters worse.
A nation with a big deficit has to seek a bail out from the IMF.
BUT this comes in the form of a loan, repayable with interest.
Like loans from a commercial bank, IMF loans are money created out of nothing, based on a cash reserve pool, which is provided by western nations who go into debt to provide it (see National Debt).
The nation with the deficit goes even more heavily into debt.
It will however be able to carry on trading and importing goods from the wealthier nations.
As a result, much of this borrowed IMF loan money flows into the economies of wealthier western nations.
However, the repayment obligation including the interest payments remains with the debtor nation.
This is the true horror of third world debt - the poorest nations borrow money to bolster the money supply of the richer nations.
In order to secure income to pay the interest, and redress the trade balance, these poorest nations must export whatever they can produce. Thus they exploit every possible resource - stripping forests for timber, mining, giving over their best agricultural land to providing luxury foodstuffs for the west, rather than providing for local needs.
Today, for nations in Africa, Central and South America and elsewhere, the revenue from their exports does not even meet the interest payments on these IMF loans (and other loans from western banks).
The sums paid in interest over the years far exceed the amounts of the original loans themselves.
The result is a desperate shortage of money in their economies - resulting in cutbacks in basic health and education programmes etc.
Grinding poverty exists in nations with great wealth in terms of natural resources.
Structural Adjustment Programmes - these are now attached to IMF loans and include conditions that recipient countries will reduce or remove tariff barriers and "open up their markets to foreign competition" - in other words take surplus goods off another country that can’t be sold at home.
NATIONAL DEBT

British national debt now stands at £400 billion - the annual interest on that debt is around £25 -30 billion. The government can only pay it by taxing the population as a whole, so we pay! National debt is up from £26 billion in 1960 and £90 billion in 1980.

Successive governments have borrowed this money into existence over the years.
Instead of creating it themselves and spending it into the economy on public services and projects boosting the economy and providing jobs, they get banks to create it for them and then borrow it at interest.
It all started in 1694 when King William needed money to fight a war against France.
He borrowed £1.2 million from a group of London bankers and goldsmiths.
In return for the loan, they were incorporated by royal charter as the Bank of England which became the government’s banker.
Interest at 8% was payable on the loan and immediately taxes were imposed on a whole range of goods to pay the interest.
This marked the birth of national debt.
Ever since then the world over, governments have borrowed money from private banking interests and taxed the population as a whole to pay the interest.
How the Government Borrows Money

When governments borrow money, in return they issue to the lender, exchequer or treasury bonds - otherwise known as government stocks or securities.
These are basically IOU’s - promises by government to repay the loan by a particular date, and to pay interest in the meantime.
They are taken up chiefly by banks, but also by individuals with money to spare including very wealthy ones in the banking fraternity and, in more recent years, pension and other investment funds.
When government securities are taken up by banks, this is money creation at the stroke of a pen by the banks out of nothing.
Banks are creating money as loans out of nothing by lending it into existence to the government in very much the same way as they do to individuals and companies.
The government now has new money in the form of loans to spend on public services etc.
If this money was not borrowed into existence in this way, there would be that much less economic activity as a result.
Under this system NATIONAL DEBT IS CREDIT ISSUED TO THE GOVERNMENT AND AS SUCH HAS BECOME A VITAL PART OF THE TOTAL MONEY SUPPLY OF ANY MODERN NATION.
The government constantly tells us that there isn’t enough money for this that and the other, because it knows that the cost of borrowing any money it needs has to be passed on to the taxpayer.
Instead, it sells off state assets and now gets the private sector to fund public services instead.
War…...

enormous increases in national debt...

enormous profits for the banks...

Massive government borrowing and money creation by banks is required to fund a war effort.
The same international bankers have covertly funded both sides in both world wars and many other conflicts before and since.
Having profited from war leaving nations with massive debts and more beholden than ever to them, the banks then fund reconstruction.
Bankers have even helped bring wars about. The calling in of loans to the German Weimar republic largely created the conditions for the rise of Hitler.
The pattern was well established by the mid 19th. century - by then international banker and speculator Nathan Rothschild could boast a personal fortune of £50 million.
The Constant Increase in National Debt

In the same way that under the present system, industry and individuals must keep borrowing more and more to enable interest payments to be kept up on their existing loans, so government must constantly borrow more and more to keep up interest payments on its existing loans.
Furthermore, when a particular government stock is due for repayment, the government simply borrows more by issuing new government stocks.
Phasing out of National Debt.

"If the government can issue a dollar bond, it can just as easily issue a dollar bill." Thomas Edison.

Government could stop borrowing money at interest, and start creating it itself by spending it into the economy on public projects and services, at the same time creating jobs and stimulating the economy.
It already does this to a very limited extent – the amount it receives from the banks when it sells cash to them is added to the public purse and is available for spending on public services and projects.
FINAL REMARKS...

Seeking to redistribute what money there is by taxing the rich to pay for services for the less well off does nothing to solve the problem of the overall shortage of money in the economy caused by interest payments on a debt based money supply - a problem which most socialists have yet to recognise.

The world’s economies are our economies. We create the real wealth through our ingenuity, enterprise and hard work. The current banking system operates as a massive drain on that wealth as well as concentrating power and control in the hands of a tiny minority.

Money is the means of facilitating the exchange of goods and services . There is nothing wrong with creating it out of nothing, because this is the only way to provide the means of exchange. The amount that is printed or created simply needs to be matched to the amount of economic activity that is taking place. What is wrong is that the right to do this has been allowed to pass to private interests who create it as loans for private profit.

U. S. President Abraham Lincoln considered it a primary duty of the government to provide a nation with the medium of exchange to enable the economy to function.
TO CONCLUDE....

Can we not ultimately incorporate the humanitarian principles of a fair distribution of wealth that underlies socialism with the dynamic benefits of a free enterprise economy that lies at the heart of capitalism?
For so long as the power to create money is in the hands of private interests who do it for profit and control, we can never say that we live in a democracy.
POST SCRIPT...

The European Union single currency gives the power to regulate the money supply of all those states that join up, to the European Central Bank. The Maastricht Treaty (article 107) forbids national governments and all other EU institutions to seek to influence the bankers who make up the ECB. For the first time this puts the creators of money totally beyond any form of democratic control or accountability.

Bilawal Butto being naughty. Pictures say it all

His antics at Oxford University would shock people in Pakistan awaiting Bilawal Bhutto Zardari's return to take over the political dream shaped by his murdered mother Benazir.

The 19-year-old's preparation for his role in one of the world's Muslim states has certainly been unconventional.

Orthodox Muslims will be surprised to see the new leader of the Pakistani People's Party with his arms slung casually around two girls, one of whom declares herself as "bisexual" on a social networking website.

Conversations he has with friends on Facebook make reference to being hungover, his friendship with a girl he calls "Boozie Suzie" and "free alcohol".

There is no evidence that Bilawal drinks alcohol – but he was certainly living it up with his two female friends at a raucous black-tie party thrown by a student drinking society.

Bilawal had been enjoying his first year at Oxford before he was named as his mother's successor after her assassination last month.

It was all a far cry from the country of his birth, which is bound by Muslim customs where drinking is forbidden, homosexuality is illegal and male and female friendships carefully controlled.

Bilawal and the girls were dressed up for the annual Cardinals' Cocktails event where, for a £10 entrance fee, students can drink many cocktails.

The Cardinals is an exclusive all-male society favoured by the wealthiest undergraduates at Christ Church, Bilawal's college at Oxford.

They hold the event for non-members once a year to raise money for a lavish dinner to be enjoyed by their privileged members at a Michelin-starred restaurant.

Only a handful of Christ Church students are allowed to join each year and they are initiated by being forced to down a bottle of port followed by eight pints of beer.

Bilawal and his friends were among hundreds of other students – not Cardinal members – at the bash this year.

Fortunately for him, his father, Asif Ali Zardari, has announced his son is too young to take power and that he will maintain day-to-day control of the party while Bilawal continues his studies.

Bilawal, who arrived at Christ Church in September to read history, grew up in Dubai after his mother left Pakistan for a self-imposed exile in 1999.

At Oxford he has not been seen at the student Islamist Society.

One senior society member said: 'He doesn't come to any of our events.' He has chosen instead to spend his time with gregarious new friends.

Two of the girls to whom he is particularly close, as our pictures show, are described on Facebook as being "engaged" to each other – Julia Caterina Hartley and Kirini Kopcke.

Julia, who was educated in Brussels, lists herself as interested in both women and men and is a member of the university's Lesbian Gay And Bisexual Society.



She and Bilawal are obviously close, often pictured cosying up together, and after Benazir Bhutto's assassination on December 27 she wrote on her Facebook site: "Julia can only think of the Bhuttos." Many of Bilawal's conversations on Facebook can be openly viewed by dozens of his friends and countless other Oxford University students.

Bilawal flirts good natured with another female student, saying: "There is a void in my life now, it's a deep dark hole in my sloe [sic] ... that can only be filled with ... boozie suzie!!"

Fellow first-year student Sammy Jay is also a close friend.

The face of Bilawal appears on a number of pages throughout Facebook but only one, using the alias of Bilawal Lawalib, is authentic.

In one exchange, before Mrs Bhutto's assassination, he tells a female friend that he "misses his secret lover" and in another exclaims "what free alcohol! I may take you up on that when I get back to Oxford!".

Bilawal's grandfather Zulfiqar Ali Bhutto, who founded the Pakistan People's Party and was the country's first elected prime minister but was executed in 1979, attended the same college.

His mother was a popular student and president of the Oxford Union.

The current Oxford Union President, Luke Tryl, says the new Bhutto is "quite popular in Union circles; very charismatic and engaging".

Daily Mail

An Unlikely Celebrity Sex Tape: Malaysian Minister

By Mike Nizza

Chua Soi Lek found out the hard way that “some Malaysians have a holier-than-thou attitude.” (Photo: Associated Press)

If Malaysia’s Minister of Health, Chua Soi Lek, were a lucky man, he might have fended off recent accusations of infidelity the way many others have: by working the he-said/she-said angle for everything it is worth and hoping that the next news cycle forgets you.

But Mr. Chua is not a lucky man, at least not today.

It seems the ministerial sex romp in question was captured on tape — from four different angles — and then edited into not one but two full-length DVDs, which were peddled on streetcorners and even seemed to reach some people as junk mail, according to the New Straits Times, a major Malay daily controlled by the ruling party.

As you might guess, the tapes have produced one helluva political scandal, which Malaysian officials initially addressed with several creative versions of “no comment.” More from the New Straits Times:

Porn Video Clip Scandal of Student of Lahore College for Women University

Postet by: Asma Gilani

Where cellphones have been proved a boon for the developing nation like Pakistan and they have become more than a fad in our society, they have also created many problems for the society.

It’s not that society was like eden before the cellphones came, and as soon as they arrived, everyone started to get undress and making nude video clips of each other. Their was promiscuousness in the society before and it will remain so. Cellphones have just brought the degradation of society in the limelight with proofs.

LCWU, the prestigious Lahore College for Women University has banned the cellphones, because a pornographic video clip of a girl who allegedly belongs to LCWU is being circulated on the Internet and though the nude clip has been filmed outside of university premises and still it’s very much unsure as the girl really belong to LCWU, but the administration of LCWU is in panic and they have banned the mobile phones in the college premises.

Will that stop people filming girl in nude stealthily or openly in our society?

Governor of Punjab Salman Taseer's Daughter and Son

Governor of Punjab Salman Taseer with his family. Salman Taseer with Daughters, Sanam Taseer, Sheherbano Taseer, Anana Taseer his wife at back. Salman Taseer two sons, Sheheryar Taseer, Shahbaz Taseer.