On the Bank of North America
©1997 by Gerry Rough

In the broader scheme of things, the Bank of North America does not see very much print in New World Order circles. The Bank of North America is barely a bump in the road on the way to the modern Federal Reserve system. The real battle for central banking comes a decade later when the first Bank of the United States appears in the pages of history. As background, the Bank of North America was started in 1781 by an act of Congress. Up until this point, Congress had experimented with paper currency issues to help finance the Revolutionary War, but the complete collapse of these currencies lead not only to economic depression, but a serious morale problem for the troops and the populace. By 1780, Congress had become desperate for new ways to finance the war with England. Enter the newly created office of Superintendent of Finance. Its first leader, Robert Morris, was known at the time as a wealthy merchant and financial wizard. He proposed a new idea to Congress to start a commercial bank that would act as fiscal agent for the government, and help to correct the problems with issuing paper money that was rapidly depreciating. A few conspiracy theorists, of course, try to spin this into the New World Order conspiracy. The following will no doubt come as a shock to those who have never seen the facts.

Our first example comes from G. Edward Griffin, author of, The Creature from Jekyll Island:

Griffin is partially correct in that the Bank was given a monopoly, but the rub here is that the monopoly status was only in effect during the Revolutionary War, not indefinitely. It is highly unlikely that Griffin was even aware of this fact, since the second half of the above citation completely redefines the word monopoly as used in the original charter. The charter stated that no other banks were to be chartered by the several states for the duration of the war, directly contradicting Griffin's redfinition. The Bank of North America was the first commercial bank in the United States, but there were two other banks that were created during the confederation period as well (1776-1789). [2] The Bank of New York and the Bank of Massachusetts were both started in 1784. [3] The Bank of North America was given a monopoly of its charter, not of note issue.

Second, there were other bank notes allowed to circulate. In fact, the Bank of North America circulated two different bank notes at the same time. The first were the notes of the Bank. The second were called Morris notes. These were bank notes backed by the personal fortune of Robert Morris. E. James Ferguson picks up the story:

So, on further examination, Robert Morris, far from the fellow conspirator of the New World Order, sacrificed his own personal fortune for the sake of the new fledgling democracy. Of interesting note, Morris would suffer financial ruin because of his lack of attention to his private affairs while in office; a devastating argument against any ridiculous conspiracy theory. [5] It is astounding to this observer that the conspiracy theorists have failed to see such an obvious point. Griffin’s assertions, then, have been found to be grossly wanting on the facts.

For this next argument, we’ll have to cut this paragraph one slice at a time in order to get the real picture. Griffin writes:

Of the $400,00 initial subscription, only $70,000 were subscribed by individual investors. Morris then used $254,000 of this loan from France to subscribe the remaining shares to the government, making the U.S. government the principle stockholder. [7] How both Griffin and his source came up with the ridiculous notion that any of this was legalized embezzlement, especially since Congress granted the charter for the Bank, is really beyond comprehension. [8] But the ironic rub of all this is that nowhere in any conspiracy writing is it realized that at this point, the Bank of North America was a government bank, since the government was the principle stockholder. Conspiracy theorists are universal in their condemnation of central banks, by the way, because they are privately owned. Here is the prime historical example of a central bank not controlled by any foreigners or private investors, and still it is derided, chided and otherwise maligned as the enemy of a free people.

Griffin continues the aforementioned paragraph:

For those who may not be aware of the term, fractional-reserve base means that you keep only a fraction of the original money, say 10%, then loan out the rest. This is how modern banks work. They keep 10% in their vaults as reserve, then loan out the rest of their depositors’ money. An obvious fabrication on his part, Griffin at this point has crossed the line of blatant fraud. Morris only used that money for subscribing the remaining shares to the government. He never used it for a fractional-reserve base, never lent it to himself, never lent it to his associates.

Griffin will no doubt soil his central banking skivvies upon hearing this, so a slight digression is in order. Robert Morris, as mentioned earlier, was elected by the Continental Congress to head the office of Superintendent of Finance. Prior to this, he was a former congressman and merchant who had dealings in arms and supplies to help fight the Revolutionary War. During his stay with Congress, Morris was made head of the Secret Committee of trade. E. James Ferguson picks up the story:

Griffin and others will be quick to point the finger at evidence like this and spin conspiracy into the facts. But what the inevitable end of the argument will be is that Morris was several times investigated by his enemies in Congress and found to be innocent of all charges. Then, as now, it was far easier to run a smear campaign than it was to get at the truth. Albert S. Bolles, author of, The Financial History of the United States: 1774-1789, summarizes: Thomas D. Schauf provides our next example. The reader is reminded that the subject matter we are discussing is the Bank of North America, begun in 1781 and founded by Robert Morris. Schauf writes: Believe it or not, we are still on the same subject. Schauf’s blatant ignorance is frankly beyond insult. This is what actually passes for scholarship for New World Order conspiracy theorists. Although the average reader will see that there is a difference between the Bank of North America and the Bank of America, it is interesting to note that the Bank of America was started in 1904 by A.P. Giannini, and was originally called the Bank of Italy. [13] If I were Thomas D. Schauf, I would be embarrassed to know that I had made this magnitude an error and yet still claim to be credible.

Our Last example comes from Bob Adelmann. The article is a reprint from "The New American" magazine. Adelmann writes of the Bank of North America:

Words could never do justice to this magnitude of outright fraud. The entire statement is a deliberate fabrication. Adelmann has done virtually no research on the issue, yet still continues to be credible in the eyes of his devoted following. If New World Order conspiracy theorists are wanting to be credible, they can start by cleaning house of those who would so blatantly deceive as serious researchers.

Sources

1) G. Edward Griffin, The Creature from Jekyll Island (Appleton: American Opinion Publishing, Inc., 1995) 326
2) E. James Ferguson, The Power of the Purse (Chapel hill: The University of North Carolina Press, 1961) 136
3) Margaret G. Myers, A Financial History Of The United States (New York: Columbia University Press, 1970) 43
4) Ferguson, p. 135, 136
5) Clarence L. Ver Steeg, Robert Morris: Revolutionary Financier (Philadelphia: University of Pennsylvania Press, 1954) 190,191
6) Griffin, p. 326
7) William M. Gouge, A Short History of Paper Money and Banking in the United States (Philadelphia: T.W. Ustick, 1833; reprinted August M Kelley, 1968) 34
8) Griffin, p. 325-327. See also Murray N. Rothbard, Conceived In Liberty: The Revolutionary War, 1775-1784 (New Rochelle, New York: Arlington House, 1979), Vol. IV, p. 392
9) Griffin, p. 326
10) Ferguson, p. 76,77
11) Albert S. Bolles, The Financial History of the United States: 1774-1789 (New York: D. Appleton & Company, 1884; reprinted August M. Kelly, 1969) 328, 329
12) Thomas D. Schauf, "The Federal Reserve," 1992
13) "Bank of the United States," The World Book Encyclopedia, volume 2, 1973, p. 60
14) Bulletin: Committee To Restore The Constitution, February, 1989. P.O. Box 986, Ft. Collins, CO 80522

Additional Resources

Norman Angel, The Story of Money (New York: Frederick A. Stokes Company, 1929)
Elgin Groseclose, Money and Man (Oklahoma: University of Oklahoma Press, 1976)
Davis Rich Dewey, Financial History of the United States ( New York: Longmans, Green, and Co., 1903)
Richard Hildreth, The History of Banks (Boston: Hilliard, Gray & Company, 1837; reprinted Augustus M. Kelley, Publishers, 1968)

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