The Global Transformation

The information in this brochure is organized in such a way that it is factual (and immutable) and easy to glean with a cursory glance. But also, there is hours and hours of substantive depth and revelations if the basic skeleton is compelling enough to induce the reader to inquire further. Committed patriots should look at every link and read every article. “WE” are the one’s that are here because of our commitment to save our country…so it is incumbent upon us to be the experts so we can in turn lead others into opening their eyes! We cannot save this country by continuing to fail to recognize where the real problem lies and then being endlessly distracted by the comparative superfluous.

We need to be aware of what is driving ALL this policy so we can begin to cut the head off the snake. We need to make sure those candidates whom we think will change Washington in 2010 understand what is REALLY going on…otherwise what success could they possibly have?

This is why I did the handbook. Understanding Agenda 21; (and how the processes to circumvent treaty’s and still engage in international law are really working); identifies entirely the problem–for Health Care, Cap and Trade, Codex Alimentarius, etc etc…they are all part of Agenda 21. Now we need to make EVERYONE aware so each has the ‘big picture’. It is essential that our candidates are aware, otherwise there is nothing they can really do.


“We are five days away from fundamentally transforming the United States of America.” — Barack Obama, October 30, 2008

“The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary.” — H.L. Mencken (1918)

“Our job is to give people not what they want, but what we decide they ought to have.” — Richard Salent, Former President CBS News.

“News is what someone wants to suppress. Everything else is advertising”. — former NBC news President Rubin Frank

If your partner were to come home one evening and announce to you that he/she is 5 days away from radically transforming you, would it be reasonable to ask a few questions, such as: Why? Into what? How are you going to do it? Who is going to transform me? How radically will I be transformed? What will it cost? What benefit will it have? Will it hurt? (Are you related to Lorraine Bobbitt?)

We are standing on the precipice of destruction, teetering unbalanced on one toe while inebriated, with the crevasse of unfathomable darkness looming menacingly below. We are about to plunge into an abyss from which there will be little hope of return. It will hurt! Both Liberals and Conservatives alike are united in their obliviousness to what is really transpiring, and what the outcome will be. Similarly, both the Left and the Right will equally suffocate when the coffin lid on America shuts tight. The radical transformation of America is completely bi-partisan in its cold neutrality.

I do not mean to be disparaging to either the Left or Right, but it becomes discouraging to see how the Left cheers the current Administration while unaware of the truth; and how the Right is easily distracted as they embroil themselves in ferreting out meaning contained within each piece of new legislation. Individuals from both sides of the fence are failing to glean the bigger picture that provides the context from which all this legislation flows. It is not that what the Conservatives are uncovering is in any way false, it is only that it is just fragments of a much bigger picture. If we continue to fail to recognize where the battlefield is, there is little hope of winning the war.

Before delving into the subject at hand, I must dispel one false hope that many Conservatives have. The biggest delusion I see my fellow Conservatives engaged in is the hope that if Obama is proved ineligible to hold office that we can then take our country back. Although I think it is important to resolve this issue, its resolution will not in any way affect the course we are on. Certainly, any laws that have been signed into being by an illegitimate President can be repealed, but this means only that the Health Care Bill (as of this writing) can be abolished. Our problems are much greater than this, with tentacles that have infested our Society and are about to choke the life out of our nation.

The international mantra that is the drive behind re-shaping the world is ‘man-made climate change’. The ‘green revolution’ has pervaded every level of our Society and there is not a day that goes by that we are not bombarded with advertisements touting how environmentally friendly some product is, or how ecologically responsible some corporation is. Its nauseating.

I am neither a Geologist nor a Climatologist, so as I pour through all the scientific arguments I must admit that I cannot confer credibility with absolutism upon either side of the debate.  However, I can ask if this ‘climate-change’ is being used as an excuse to foist a political agenda?

There have been numerous publications and statements made that certainly reveal the intent to create a crisis so that the Elitists can step in and tender their solution.

“The common enemy of humanity is man.
In searching for a new enemy to unite us, we came up
with the idea that pollution, the threat of global warming,
water shortages, famine and the like would fit the bill. All these
dangers are caused by human intervention, and it is only through
changed attitudes and behavior that they can be overcome.
The real enemy then, is humanity itself.”

Club of Rome-premier environmental think-tank,consultants to the United Nations

“We’ve got to ride this global warming issue.
Even if the theory of global warming is wrong,
we will be doing the right thing in terms of
economic and environmental policy.”

Timothy Wirth, President of the UN Foundation

“Adopting a central organizing principle…
means embarking on an all-out effort to use every
policy and program, every law and institution…
to halt the destruction of the environment.”

Al Gore-Earth in the Balance, member of Club of Rome, co-founder of Generations Investment Fund

Effective execution of Agenda 21 will require a profound
reorientation of all human society, unlike anything the world
has ever experienced – a major shift in the priorities of both
governments and individuals and an unprecedented
redeployment of human and financial resources. This shift
will demand that a concern for the environmental consequences
of every human action be integrated into individual and
collective decision-making at every level.

UN Agenda 21(signed by G.H. Bush, 1992)

This has been just a small sampling of many similar quotes,  to read more click [here].  For a list of references to all quotes, click [here].

If you are a functional human being in possession of a modicum of intellect, it should be glaringly obvious that something nefarious is afoot.  It may come as a surprise to many that revenues from Cap and Trade have already been accounted for in the 2012 budget. The Elite Class has had a plan in the hopper for some time now, and it is rapidly coming to fruition.  The universal acceptance of Agenda 21 has ushered in this new era, and just by giving a cursory glance over the 40 chapter titles that comprise Agenda 21 would reveal the depth of this Master Plan.

Never heard of Agenda 21?  Perhaps you have heard the words ‘sustainable’, ‘smart growth’, ‘social justice’, ‘biological equity’, and a plethora of similar words that have pervaded our societal lexicon.  Whenever you hear such words realize they are derivatives of Agenda 21.   Enclosed below is a description of Agenda 21 taken from the Johannesburg Summit of 2002.

This meeting will review progress in implementing Agenda 21, the plan of action for sustainable development that was agreed in Rio, and develop a plan for the further implementation of sustainable development policies and programmes worldwide. Secretary-General Kofi Annan has identified five themes for particular attention at the Summit: water, energy, health, agriculture and biodiversity. These are critical areas for long-term development, involving complex interactions among economic, social and environmental factors and involving different sectors, organizations and disciplines. Those issues, together with population and poverty, and the relationships among them, are the focus of the material collected here.
Agenda 21 is the blueprint for globalization and is the precursor to all legislation, taxes, and regulations you see coming out of Washington.  It is the vehicle by which the Master Class has found its Utopian dream of absolute control over you while simultaneously raping the world of all its wealth.  Power and money.  Since its inception in 1992, they have held 18 annual meetings.  Between May 3-14th of 2010 they held another meeting in NYC.  In attendance were all 50 signatory nations and representatives from 2,146 CSO’s (Civil Society Organizations, which are NGO’s that are accredited by the United Nations to have consultative status).  Want to know when America as you know it is coming to an end?  Well, that information is well documented too, and is known as the Marrakech Transition Process.  It may be comforting to some to know they have a life plan.  Unfortunately, it is being planned by someone else.
Do not let the noble sounding drivel of Agenda 21 fool you-remember, this is all steeped in the contrived notion that your presence on earth is contributing to cataclysmic climate change; authored by the elitists.  This Elite Class is comprised of internationalists from the financial world, media moguls, powerful politicians, upper echelon military, and multinational CEO’s.  Regardless their country of origin, they fail to see the world as you and I might see it, because they play ball on a global field.  Where we see regions of national sovereignty, they see only potential markets to be exploited.  Where we see individuals trying to lead their lives, they see us as merely insects to be squeezed for every last ounce of juice they can wring out of us.

An example that lends veracity to the bold statements made above is the creation of the Chicago Climate Exchange (CCX). All of the usual global elitists got together (either directly or indirectly) to form a company that is going to capitalize on regulations that will be levied against all persons and companies via Cap and Trade.  This bill has not even been signed into law, yet the company was formed 10 years ago in preparation of what they will do to us.  Al Gore has set up his company, Generations Investment Management that is poised to profit from the re-distribution of wealth.  The following is taken directly off his website:

According to some experts, the Base of the Pyramid is an untapped market opportunity of $13 trillion in annual sales as well as significant invisible assets.

I am baffled that no seems to have put together what should be the most alarming 2 pieces of information ever announced:  Just as Generations Investment Management states they anticipate $13 trillion in annual sales, the Chicago Climate Exchange announced that they expect $10 trillion in annual sales.  The worlds entire annual GDP is $69 trillion.  The United States annual GDP is $17 trillion. What they are saying is that just these two companies alone plan on capturing 33% of the worlds entire wealth!

The Elitists behind the theoretical development of these political platforms are Maurice Strong, David Rockefeller, Al Gore, Mikhail Gorbachev, Robert Muller, George Soros, and about 100 others that will always appear on boards of various NGO’s (non-government organizations).  Although I can trace these individuals to connections with apprx. 1,800 other organizations, they all sit on the Board of the Club of Rome.  These names will repeat themselves as you start sifting through each and every one of these organizations. For an in-depth look at the people and organizations, click [here].

For example, it is interesting to note that the Trilateral CommissionThe Council on Foreign RelationsThe Rockefeller Foundation, and the Club of Rome were all founded by David Rockefeller.  It is also interesting to note that all these organizations and the plethora of their alliances all carry the same message, and all have the usual people associated with them.

The collaborative efforts of these CSO’s work to shape policy. Maurice Strong is founder of the Earth Council Alliance, and is responsible for writing policy underlying the Kyoto Treaty, the Rio Earth Summit, and the Earth Charter Initiative.  The Club of Rome (via the collaborative efforts of all their different alliances), put together Agenda 21, adopted by the United Nations and signed by G.H. Bush in 1992.  The Earth Charter Initiative is a global curriculum for the re-education of our children, adopted by UNESCO and signed by G.W. Bush in 2000.

Have you ever wondered where the 1.2 trillion dollars funneled through the IMF goes? What about annual payment of 46 billion dollars paid out via the Millennium Accords and Global Poverty Act?  Much of it is given to these NGO’s in the form of grants. The recent Health Care Bill had 159 such grants embedded in it. Your money is being used to dig your own grave with.

I cannot fully expose the labyrinthine corridors of corruption in a singular accounting, but it is vitally important you begin to understand the depth of the ruse being foisted upon us.  We cannot fight these powers, but we can hold our elected officials feet to the fire and have them resolve this mess.  The 2010 elections are going to be the most important event in your lifetime.  We need a supermajority in the House, and those individuals must be willing to not only restore our country through Constitutional leadership, but they must also be aware of the corruption being foisted upon us and honor-bound to fight our fight!  We cannot hold them accountable unless we ourselves are knowledgeable as to where exactly the problem exists.

Recommended Reading:

Links to NGO’s and their Masters
Understanding NGO’s
Exposing the Club of Rome
Local Government for Sustainability


Bretton Woods is a name we have all heard of since high school history class, but do we remember what took place there? Quite a lot happened there, but what we are focused on now is what was initially called the United Nations Monetary and Financial Conference. At that meeting five institutions were created; we are only concerned with two, the International Monetary Fund (IMF) and the World Bank (officially the International Bank for Reconstruction and Development) which were conceived in July 1944 and formally organized in July of the following year.

G. Edward Griffin explains the façade and the reality of these two entities, “The announced purpose of these organizations were admirable. The World Bank was to make loans to war-torn and underdeveloped nations so they could build stronger economies. The International Monetary Fund was to promote monetary cooperation between nations by maintaining fixed exchange rates between their currencies. But the method by which these goals were to be achieved was less admirable. It was to terminate the use of gold as the basis of international currency exchange and replace it with a politically manipulated paper standard. In other words, it was to allow governments to escape the discipline of gold so they could create money out of nothing without paying the penalty of having their currencies drop in value on world markets.”[2]

Both the IMF and the World Bank are based in Washington, D.C. The IMF always has a European head while the World Bank’s leader is an American.

Initially, as noted, they were set up to fund the reconstruction of Europe and Asia after World War II, and then to build infrastructure and provide for the basic needs of people in the developing world. But in the 1960s, the World Bank shifted the focus of its loans from infrastructure to social services and other social justice[3] sectors.

As Griffin points out, “The International Monetary Fund appears to be a part of the United Nations, much as the Federal Reserve System appears to be part of the United States government, but it is entirely independent. It is funded on a quota basis by its member nations, almost 200 in number. The greatest share of capital, however, comes from the more highly industrialized nations such as Great Britain, Japan, France, and Germany. The United States contributes the most, at about twenty percent of the total. In reality, that twenty percent represents about twice as much as the number indicates, because most of the other nations contribute worthless currencies which no one wants. The world prefers dollars.

One of the routine operations at the IMF is to exchange worthless currencies for dollars so the weaker countries can pay their international bills. This is supposed to cover temporary “cash-flow” problems. It is a kind of international FDIC[4] which rushes money to a country that has gone bankrupt so it can avoid devaluing its currency. The transactions are seldom paid back.”

“Although escape from the gold-exchange standard was the long-range goal of the IMF, the only way to convince nations to participate at the outset was to use gold itself as a backing for its own money supply – at least as a temporary expedient.”[5]

So now instead of IMF loans for concrete projects – infrastructure, private industry, and other sound investments — the loans are going to governments in pursuit of “humanitarian goals.” Actually much of the money ends up in the pockets of the leaders and bureaucrats. Some, very little, is actually used for aid to the starving citizens of those countries.

Part 1, Purpose

The International Monetary and Financial Committee (IMFC)[6][7] has now requested that the IMF review “its mandate to cover the full range of macroeconomic and financial sector policies that bear on global stability,” and to report back to the Committee next year. On January 22, 2010, the International Monetary Fund’s Strategy, Policy, and Review Department (in consultation with the Legal Department) prepared an overview of the Fund’s Mandate and what it saw as the problems of control facing the Fund and how they could tweak the mandate “without the politically taxing process of amending the Articles of Agreement.”

What that means is how to make the IMF far more powerful than it already is without having the members vote on the changes, since the members would not be willing to make such far-reaching and drastic changes. For instance, regarding financial data of IMF members:

First, it (the IMF) has only limited and episodic access to supervisory data (e.g., in the context of FSAPs (Financial Sector Assessment Program), and members often decline to provide systemically relevant information on grounds of confidentiality. Second, the Fund has no authority to require confidential data on entities such as large complex financial institutions (LCFIs), a few dozen of which make up the basic plumbing of global finance. The reason is that Article VIII, Section 5 provides that members are under no obligation to furnish information that exposes individual corporations. Yet understanding the linkages between LCFIs, and changing patterns and concentrations in exposure, is crucial to any institution claiming to be a guardian of global stability. As amendment of the Articles to require such disclosure is unlikely to find broad support, alternative arrangements will be needed.

Already we see that the IMF is facing a brick wall if they have to go to the members for permission, but not if they go around the members via executive decisions. The IMF sees itself as a “guardian of global stability,” that is literally how they put it; yet a normal person, even one with little economics savvy, would consider them just the opposite. What the IMF, World Bank, the Federal Reserve, Bank of England, etc. are doing is working toward global instability – not stability – until they can wrest controlling power. Then they will set up stability in a world of masters (them) and slaves (us).

You don’t think so? Here is an interview of Maurice Strong, one of the world’s richest men, the Secretary-General of the 1992 Earth Summit in Rio, President of the World Federation of United Nations, and on and on, speaking to journalist, Daniel Wood of WEST Magazine:

Each year the World Economic Forum convenes in Davos, Switzerland. Over a thousand CEOs, prime ministers, finance ministers, and leading academics gather in February to attend meetings and set the economic agendas for the year ahead. What if a small group of these word leaders were to conclude that the principle risk to the earth comes from the actions of the rich countries? And if the world is to survive, those rich countries would have to sign an agreement reducing their impact on the environment. Will they do it? Will the rich countries agree to reduce their impact on the environment? Will they agree to save the earth?

The group’s conclusion is “no.” The rich countries won’t do it. They won’t change. So, in order to save the planet, the group decides:isn’t the only hope for the planet that the industrialized civilizations collapse? Isn’t it our responsibility to bring that about?

This group of world leaders form a secret society to bring about a world collapse. It’s February. They’re all at Davos. These aren’t terrorists – they’re world leaders. They have positioned themselves in the world’s commodity and stock markets. They’ve engineered, using their access to stock exchanges, and computers, and gold supplies, a panic. Then they prevent the markets from closing. They jam the gears. They have mercenaries who hold the rest of the world leaders at Davos as hostage. The markets can’t close. The rich countries…?[8]

Or as Griffin puts it in Creature, “Destruction of the economic strength of the industrialized nations is merely a necessary prerequisite for ensnaring them into the global web. The thrust of the current ecology movement is directed totally to that end.”[9]

Capital flows

(I)t seems appropriate that Fund surveillance cover more effectively capital flows and related policies. Granting the Fund the authority to approve — or not — capital controls would require amending the Articles, which is never an easy process, especially on an issue on which the membership is highly divided.

As will be shown further into this paper, the IMF wants capital to flow from the U.S. and other First World Countries to Third World Countries – from the “haves” to the “have nots.” Capital flow is not meant to promote technological or industrial growth, but will be used for welfare in order to create dependency; the IMF does not want the poor people of the world becoming strong and healthy economically or physically.

Role in Low Income Countries

In particular, the Fund may need to expand its role as a provider of insurance against global volatility and other shocks, including from the effects of climate change.[10]

Even though the global warming scare has been shown as a fraud to promote onerous legislation like “cap and trade,” to shut down industry in the U.S., and to prevent people from using their private property, all of these actions are still being carried out so the IMF pretends there is still a basis for it.

Also, Agenda 21 – the Earth Charter, calls for the redistribution of wealth between rich and poor countries as seen in section 2.1 on page 19:

“In order to meet the challenges of environment and development, States have decided to establish a new global partnership. This partnership commits all States to engage in a continuous and constructive dialogue, inspired by the need to achieve a more efficient and equitable world economy, keeping in view the increasing interdependence of the community of nations and that sustainable development should become a priority item on the agenda of the international community….

Economic policies of individual countries, and international economic relations both have great relevance to sustainable development. …Neither will it gather momentum if the developing countries are weighted down by external indebtedness…. Therefore, it is the intent of Governments that consensus-building at the intersection of the environmental and trade and development areas will be ongoing in existing international forums, as well as in the domestic policy of each country.”


The build-up of international reserves as a buffer against shocks is widely expected to resume as the crisis fades and to some extent already has. While such accumulation can be costly for surplus and reserve-issuing countries alike, there are three underlying problems. First, there are concerns about the availability of international liquidity in times of crisis, prompting a precautionary reserve buildup, especially when heavy capital inflows threaten to overwhelm emerging markets. Second, there is no automatic adjustment of current account imbalances, neither surplus countries nor reserve-issuing deficit countries facing pressure to adjust. Third, the concentration of reserves in US dollars reflects the absence of close substitutes as a global store of value and anchor for asset and price stability. The Fund’s overarching responsibility to promote the effective operation of the international monetary system requires that it seek solutions to the above problems. While it may draw on all its powers for this purpose, a rarely discussed one is to be found in Article VIII, Section 7, which calls on members to collaborate on reserve policies with the objective of “better international surveillance of international liquidity and making the special drawing right the principal reserve asset in the international monetary system.” Consideration may need to be given to reviving this forgotten provision as a basis for action, not least because official reserves have become large enough relative to private flows as to have significant—and potentially destabilizing—market impact from a sudden portfolio reallocation.

A key problem with using a national currency as the main global reserve asset is that instability in its value translates to the entire system. The problem can be ameliorated by the presence of several suppliers of reserve assets—the euro has emerged as an alternative to the dollar and at some point in the future the yen and, further out, the renminbi[11] might also—or by globally-issued reserves. Given the network externalities associated with a single reserve asset, neither solution is likely to emerge spontaneously any time soon. Thus, it may be necessary to consider giving content to members’ obligation, under Article VIII, Section 7, “to collaborate with the Fund and with one another with regard to policies on reserve assets” so as to facilitate a smooth transition to a more stable system.

The IMF is making the point that the U.S. Dollar should no longer be used as the main global reserve asset. While they are considering using the yuan, they actually have other plans:

A global currency. The SDR is not a currency but a right to access freely usable currencies in case of balance of payments difficulties; its stability rests on that of its component currencies. A more far reaching approach would be to introduce a new global reserve currency, similar to Keynes’ bancor[12], issued by an institution with an impeccable balance sheet and a governance structure that gives confidence that it can function as a prudent and independent world central bank. A global reserve currency that is not associated with the economic developments of any particular country would remove the vulnerabilities associated with reserve accumulation in national currencies and could remedy the lack of automatic adjustment. The operational and political challenges, however, would be huge. As such, the idea is clearly one for the long term.

While the IMF’s Overview writers predict only positive effects of a global currency, what about the fact that there is no basis in gold or oil or precious metals for their currency? Without something to define the value of a currency, some standard on which to measure it, it then becomes the monetary equivalent of moral relevancy – it’s worth changing with the whims of the power elite.

That is a quick look at the Overview of the IMF’s Mandate.

Part 2, The Lawyers; or how to get around the rules

A month to the day after that was submitted, “The Fund’s Mandate – The Legal Framework” was offered up to accompany the Overview. Interestingly, it begins with a note on the specialization of the organization and states,

While, at a certain level of abstraction, it may be said that all international organizations have been established to enhance human welfare, the assumption underlying the design of the post-war international architecture was that each organization would make its own distinct contribution to that objective; … since all of the enumerated purposes are of an economic nature, it has been understood that, unlike some other organizations, the Fund is precluded from using its powers for political objectives. (italics mine)

It would be hard to see any other use of its powers. The IMF is one of the tentacles of Agenda 21 which is totally political – working toward a totalitarian socialistic world government through the redistribution of wealth.

The powers conferred upon the Fund under the Articles can be divided into three categories: (a) oversight powers,relating primarily to the Fund’s responsibility to monitor and promote the observance of members’ obligations under the Articles; (b) the power to provide financial assistance; and (c) advisory powersConsistent with the principles of national sovereignty (italics mine) and specialization noted above, the powers conferred upon the Fund are generally limited to those explicitly identified in the Articles.

But they go onto state:

Accordingly, while the key parameters of the Fund’s mandate are established in the Articles of Agreement, it may be said that the operational content of the Fund’s mandate has been updated over time by Executive Board decision.

In other words, the Executive Board has made many changes that the members never would have allowed.

The legal department gripes that regarding domestic policies, including financial sector policies, member obligations are limited in two important respects:

  • First, the relevant text reveals that these obligations (Article IV, Section 1 (i) and (ii)) are of a “soft” nature: taking into account the fact that members retain great sovereignty in terms of the conduct of their domestic policies, they are only required to exercise “best efforts” in this area. In contrast, those obligations that relate to members’ external policies, including exchange rate policies (Article IV, Section 1 (iii) and (iv)), are of a “hard” nature—requiring the achievement of results rather than just the exercise of best efforts—reflecting the direct international impact of these policies.
  • Second, members’ obligations respecting domestic policies only require members to take action to promote their own domestic stability. As long as a member is implementing domestic policies in a manner that ensures such stability, it is under no obligation to change these policies, even if a change would further enhance the stability of the overall exchange rate system.

They are not happy that the members “retain great sovereignty in terms of the conduct of their domestic policies” or that the members’ obligations are to promote their own domestic stability – not that of the rest of the world (and they say this). In order to get around the Articles in the Mandate that they find to be too restricting, the legal department suggests that the constraints could be addressed through the adoption of decisions by the Executive Board.

What they are saying is that even though a country is being fiscally responsible, if the IMF decides that their domestic policies are impacting the “the balance of payments of other countries, even where this effect is not transmitted through the member’s own balance of payment,” then the IMF could step in and make those fiscally responsible countries change their fiscally conservative policies.

In order for the type of situation identified in paragraph 15 above to be made central to bilateral surveillance, it would be necessary to amend Article IV itself. Such an amendment could reconsider the primacy that is given to exchange rate policies over domestic policies and, in that context, expand members’ obligations relating to domestic policies in a manner that would require a member to adjust its domestic policies to support systemic stability—even if the domestic policies in question are not undermining the member’s own domestic stability. This would represent, however, a significant surrender of national sovereignty. (italics mine)

Much of the review is working out how the IMF can broaden its surveillance scope of countries. Right now member countries are under no obligation to furnish information in “such detail that the affairs of individuals or corporations are disclosed.” The IMF would like to change this without having to amend the Agreement (remember member countries are unlikely to want to give up either more information or their sovereignty), so they are looking to the Executive Board to make the necessary changes and to read the Articles in a new light to change “expectations” of information from members to solid demands.

And now to the Reserve Policies of Members:

“[e]ach member undertakes to collaborate with the Fund and with other members in order to ensure that the policies of the member with respect to reserve assets shall be consistent with the objectives of promoting better international surveillance of international liquidity and making the special drawing right the principal reserve asset in the international monetary system.” (italics mine)

As stated by the Legal Department, this provision was one of several new provisions that “were designed to reduce the role of gold and to strengthen the role of SDRs in the international monetary system,” or to put it another way, to have fiat money as the sole reserves.

The Fund would also need to provide further guidance on the meaning of the obligation of members to collaborate towards the objective of making the SDR the principal reserve asset in the international monetary system. Two important features of this objective should be noted. First, making the SDR the principal reserve asset of the international monetary system is identified as an objective, but not necessarily as a result that has been—or is required to be—achieved.

In discussing the Oversight of International Capital Movements, the Legal Department admits that while they want a more active role in overseeing members’ regulation of these movements, designing “an appropriate approach is far more complex and nuanced” than it was when they were just controlling current payments and transfers.

They admit that free capital movements “help channel resources to their most productive uses and increase economic growth and welfare.” But they then blame the free markets for the recent crises.

With that, the Legal Department says it would be open for the Fund to establish policies (which they would call “recommendations” for a softer sell), that provide guidance to members;

as to: (a) what conditions should be in place before a member liberalizes its capital account, and (b) when the imposition of controls on outflows or inflows may be an appropriate response to balance of payments or macroeconomic pressures. In the conduct of bilateral surveillance, the Fund would assess the extent to which members’ actions are consistent with these recommendations. The Fund could also take up the systemic role of capital movements—and the impact of controls on such movements—in the context of multilateral surveillance.

In other words, the IMF would decide what the countries’ fiscal and economic policies MUST be.


“Power tends to corrupt, and absolute power corrupts absolutely.”
— Lord Acton

That sentence sums up this document very well. What happens when a group of powerful people decide that they do not have enough wealth and power and need to find more, is what happened here, or rather at Bretton Woods. Harry Dexter White, Assistant Secretary of the U.S. Treasury and John Maynard Keynes were the designers of the IMF and World Bank on behalf of themselves and their cronies in finance and government in the U.S. and Europe.

These same people also believe that what the world needs now is global governance. As a former U.S. Foreign Service Officer put it in his book, Ecology and the Politics of Scarcity Revisited, the Unraveling of the American Dream, “… the golden age of individualism, liberty, and democracy is all but over. The need for a world government with enough coercive power over fractious nation states to achieve what reasonable people would regard as the planetary common interest has become overwhelming.”[13]

I have quoted G. Edward Griffin a number of times, let me add one more because he puts his finger on it so well. “Although most of the policy statements of the World Bank (and the IMF by extension, author’s note) deal with economic issues, a close monitoring of its activities reveal a preoccupation with social and political issues. This should not be surprising considering that the Bank was perceived by its founders as an instrument for social and political change. The change which it was designed to bring about was the building of world socialism, and that is exactly what it is accomplishing today.”[14]

Remember, the IMF doesn’t want the poor people of the world becoming strong and healthy economically or physically. What they want is control of the world – of both the rich and the poor countries – but they have to make the rich countries far poorer first (through their economic policies) in order to control them.


[1] While the International Monetary Fund is referred to as the IMF in most media sources, insiders call themselves the Fund.

[2] Griffin, G. Edward, The Creature from Jekyll Island, A Second Look at the Federal Reserve. America Media, 2009 edition, p. 86.

[3] A system of human rights operates in concert with the pursuit of “social justice,” which can be defined as law formulated to obtain government’s social objectives at the expense of individual liberty.

[4] Federal Deposit Insurance Corporation

[5] Griffin, op. cit., p. 89.

[6]Quote from the INTERNATIONAL MONETARY FUND, The Fund’s Mandate—An Overview, prepared by the Strategy, Policy, and Review Department.

[7] Bank-Fund Annual Meetings and in March or April at what are referred to as the Spring Meetings. The Committee discusses matters of concern affecting the global economy and also advises the IMF on the direction of its work. At the end of the meetings, the Committee issues a communiqué summarizing its views. These communiqués provide guidance for the IMF’s work program during the six months leading up to the next Spring or Annual Meetings. There is no formal voting at the IMFC, which operates by consensus.

[8] Wood, Daniel. “The Wizard of Baca Grande,” West Magazine, May, 1990, p. 35.

[9] Griffin, op. cit., p. 534.

[10] Note that this was written after the Climate Change scandal was exposed.

[11] The renminbi or the Chinese yuan is the official currency of the People’s Republic of China (PRC), with the exception of Hong Kong and Macau.

[12] John Maynard Keynes proposed a global bank, which he called the International Clearing Union. The bank would issue its own currency – the bancor – which was exchangeable with national currencies at fixed rates of exchange. The bancor would become the unit of account between nations, which means it would be used to measure a country’s trade deficit or trade surplus. (

[13] Orphuls, William, Ecology and the Politics of Scarcity Revisited, the Unraveling of the American Dream, W.H. Freedman & Co., New York, 1992, p. 78.

[14] Griffin, op. cit., p. 95.

This did not make the news!

Challenging America was the prime focus of extended meetings in Yekaterinburg, Russia (formerly Sverdlovsk) June 15-16 for Chinese President Hu Jintao, Russian President Dmitry Medvedev and other top officials of the six-nation Shanghai Cooperation Organization (SCO). The alliance is comprised of Russia, China, Kazakhstan, Tajikistan, Kyrghyzstan and Uzbekistan, with observer status for Iran, India, Pakistan and Mongolia. It will be joined on Tuesday by Brazil for trade discussions among the BRIC nations (Brazil, Russia, India and China).

The attendees have assured American diplomats that dismantling the US financial and military empire is not their aim. They simply want to discuss mutual aid – but in a way that has no role for the United States, NATO or the US dollar as a vehicle for trade. US diplomats may well ask what this really means, if not a move to make US hegemony obsolete. That is what a multipolar world means, after all. For starters, in 2005 the SCO asked Washington to set a timeline to withdraw from its military bases in Central Asia. Two years later the SCO countries formally aligned themselves with the former CIS republics belonging to the Collective Security Treaty Organization (CSTO), established in 2002 as a counterweight to NATO.

Yet the meeting has elicited only a collective yawn from the US and even European press despite its agenda is to replace the global dollar standard with a new financial and military defense system. A Council on Foreign Relations spokesman has said he hardly can imagine that Russia and China can overcome their geopolitical rivalry, suggesting that America can use the divide-and-conquer that Britain used so deftly for many centuries in fragmenting foreign opposition to its own empire. But George W. Bush (“I’m a uniter, not a divider”) built on the Clinton administration’s legacy in driving Russia, China and their neighbors to find a common ground when it comes to finding an alternative to the dollar and hence to the US ability to run balance-of-payments deficits ad infinitum.

What may prove to be the last rites of American hegemony began already in April at the G-20 conference, and became even more explicit at the St. Petersburg International Economic Forum on June 5, when Mr. Medvedev called for China, Russia and India to “build an increasingly multipolar world order.” What this means in plain English is: We have reached our limit in subsidizing the United States’ military encirclement of Eurasia while also allowing the US to appropriate our exports, companies, stocks and real estate in exchange for paper money of questionable worth.

“The artificially maintained unipolar system,” Mr. Medvedev spelled out, is based on “one big centre of consumption, financed by a growing deficit, and thus growing debts, one formerly strong reserve currency, and one dominant system of assessing assets and risks.” At the root of the global financial crisis, he concluded, is that the United States makes too little and spends too much. Especially upsetting is its military spending, such as the stepped-up US military aid to Georgia announced just last week, the NATO missile shield in Eastern Europe and the US buildup in the oil-rich Middle East and Central Asia.

The sticking point with all these countries is the US ability to print unlimited amounts of dollars. Overspending by US consumers on imports in excess of exports, US buy-outs of foreign companies and real estate, and the dollars that the Pentagon spends abroad all end up in foreign central banks. These agencies then face a hard choice: either to recycle these dollars back to the United States by purchasing US Treasury bills, or to let the “free market” force up their currency relative to the dollar – thereby pricing their exports out of world markets and hence creating domestic unemployment and business insolvency.

When China and other countries recycle their dollar inflows by buying US Treasury bills to “invest” in the United States, this buildup is not really voluntary. It does not reflect faith in the U.S. economy enriching foreign central banks for their savings, or any calculated investment preference, but simply a lack of alternatives. “Free markets” US-style hook countries into a system that forces them to accept dollars without limit. Now they want out.

This means creating a new alternative. Rather than making merely “cosmetic changes as some countries and perhaps the international financial organisations themselves might want,” Mr. Medvedev ended his St. Petersburg speech, “what we need are financial institutions of a completely new type, where particular political issues and motives, and particular countries will not dominate.”

When foreign military spending forced the US balance of payments into deficit and drove the United States off gold in 1971, central banks were left without the traditional asset used to settle payments imbalances. The alternative by default was to invest their subsequent payments inflows in US Treasury bonds, as if these still were “as good as gold.” Central banks now hold $4 trillion of these bonds in their international reserves – land these loans have financed most of the US Government’s domestic budget deficits for over three decades now! Given the fact that about half of US Government discretionary spending is for military operations – including more than 750 foreign military bases and increasingly expensive operations in the oil-producing and transporting countries – the international financial system is organized in a way that finances the Pentagon, along with US buyouts of foreign assets expected to yield much more than the Treasury bonds that foreign central banks hold.

The main political issue confronting the world’s central banks is therefore how to avoid adding yet more dollars to their reserves and thereby financing yet further US deficit spending – including military spending on their borders?

For starters, the six SCO countries and BRIC countries intend to trade in their own currencies so as to get the benefit of mutual credit that the United States until now has monopolized for itself. Toward this end, China has struck bilateral deals with Argentina and Brazil to denominate their trade in renminbi rather than the dollar, sterling or euros, and two weeks ago China reached an agreement with Malaysia to denominate trade between the two countries in renminbi.  Former Prime Minister Tun Dr. Mahathir Mohamad explained to me in January that as a Muslim country, Malaysia wants to avoid doing anything that would facilitate US military action against Islamic countries, including Palestine. The nation has too many dollar assets as it is, his colleagues explained. Central bank governor Zhou Xiaochuan of the People’s Bank of China wrote an official statement on its website that the goal is now to create a reserve currency “that is disconnected from individual nations.”  This is the aim of the discussions in Yekaterinburg.

In addition to avoiding financing the US buyout of their own industry and the US military encirclement of the globe, China, Russia and other countries no doubt would like to get the same kind of free ride that America has been getting. As matters stand, they see the United States as a lawless nation, financially as well as militarily. How else to characterize a nation that holds out a set of laws for others – on war, debt repayment and treatment of prisoners – but ignores them itself? The United States is now the world’s largest debtor yet has avoided the pain of “structural adjustments” imposed on other debtor economies. US interest-rate and tax reductions in the face of exploding trade and budget deficits are seen as the height of hypocrisy in view of the austerity programs that Washington forces on other countries via the IMF and other Washington vehicles.

The United States tells debtor economies to sell off their public utilities and natural resources, raise their interest rates and increase taxes while gutting their social safety nets to squeeze out money to pay creditors. And at home, Congress blocked China’s CNOOK from buying Unocal on grounds of national security, much as it blocked Dubai from buying US ports and other sovereign wealth funds from buying into key infrastructure. Foreigners are invited to emulate the Japanese purchase of white elephant trophies such as Rockefeller Center, on which investors quickly lost a billion dollars and ended up walking away.

In this respect the US has not really given China and other payments-surplus nations much alternative but to find a way to avoid further dollar buildups. To date, China’s attempts to diversify its dollar holdings beyond Treasury bonds have not proved very successful. For starters, Hank Paulson of Goldman Sachs steered its central bank into higher-yielding Fannie Mae and Freddie Mac securities, explaining that these were de facto public obligations. They collapsed in 2008, but at least the US Government took these two mortgage-lending agencies over, formally adding their $5.2 trillion in obligations onto the national debt. In fact, it was largely foreign official investment that prompted the bailout. Imposing a loss for foreign official agencies would have broken the Treasury-bill standard then and there, not only by utterly destroying US credibility but because there simply are too few Government bonds to absorb the dollars being flooded into the world economy by the soaring US balance-of-payments deficits.

Seeking more of an equity position to protect the value of their dollar holdings as the Federal Reserve’s credit bubble drove interest rates down China’s sovereign wealth funds sought to diversify in late 2007. China bought stakes in the well-connected Blackstone equity fund and Morgan Stanley on Wall Street, Barclays in Britain South Africa’s Standard Bank (once affiliated with Chase Manhattan back in the apartheid 1960s) and in the soon-to-collapse Belgian financial conglomerate Fortis. But the US financial sector was collapsing under the weight of its debt pyramiding, and prices for shares plunged for banks and investment firms across the globe.

Foreigners see the IMF, World Bank and World Trade Organization as Washington surrogates in a financial system backed by American military bases and aircraft carriers encircling the globe. But this military domination is a vestige of an American empire no longer able to rule by economic strength. US military power is muscle-bound, based more on atomic weaponry and long-distance air strikes than on ground operations, which have become too politically unpopular to mount on any large scale.

On the economic front there is no foreseeable way in which the United States can work off the $4 trillion it owes foreign governments, their central banks and the sovereign wealth funds set up to dispose of the global dollar glut. America has become a deadbeat – and indeed, a militarily aggressive one as it seeks to hold onto the unique power it once earned by economic means. The problem is how to constrain its behavior. Yu Yongding, a former Chinese central bank advisor now with China’s Academy of Sciences, suggested that US Treasury Secretary Tim Geithner be advised that the United States should “save” first and foremost by cutting back its military budget. “U.S. tax revenue is not likely to increase in the short term because of low economic growth, inflexible expenditures and the cost of ‘fighting two wars.’”

At present it is foreign savings, not those of Americans that are financing the US budget deficit by buying most Treasury bonds. The effect is taxation without representation for foreign voters as to how the US Government uses their forced savings. It therefore is necessary for financial diplomats to broaden the scope of their policy-making beyond the private-sector marketplace. Exchange rates are determined by many factors besides “consumers wielding credit cards,” the usual euphemism that the US media cite for America’s balance-of-payments deficit. Since the 13th century, war has been a dominating factor in the balance of payments of leading nations – and of their national debts. Government bond financing consists mainly of war debts, as normal peacetime budgets tend to be balanced. This links the war budget directly to the balance of payments and exchange rates.

Foreign nations see themselves stuck with unpayable IOUs – under conditions where, if they move to stop the US free lunch, the dollar will plunge and their dollar holdings will fall in value relative to their own domestic currencies and other currencies. If China’s currency rises by 10% against the dollar, its central bank will show the equivalent of a $200 million loss on its $2 trillion of dollar holdings as denominated in yuan. This explains why, when bond ratings agencies talk of the US Treasury securities losing their AAA rating, they don’t mean that the government cannot simply print the paper dollars to “make good” on these bonds. They mean that dollars will depreciate in international value. And that is just what is now occurring. When Mr. Geithner put on his serious face and told an audience at Peking University in early June that he believed in a “strong dollar” and China’s US investments therefore were safe and sound, he was greeted with derisive laughter.7

Anticipation of a rise in China’s exchange rate provides an incentive for speculators to seek to borrow in dollars to buy renminbi and benefit from the appreciation. For China, the problem is that this speculative inflow would become a self-fulfilling prophecy by forcing up its currency. So the problem of international reserves is inherently linked to that of capital controls. Why should China see its profitable companies sold for yet more freely-created US dollars, which the central bank must use to buy low-yielding US Treasury bills or lose yet further money on Wall Street?

To avoid this quandary it is necessary to reverse the philosophy of open capital markets that the world has held ever since Bretton Woods in 1944. On the occasion of Mr. Geithner’s visit to China, “Zhou Xiaochuan, minister of the Peoples Bank of China, the country’s central bank, said pointedly that this was the first time since the semiannual talks began in 2006 that China needed to learn from American mistakes as well as its successes” when it came to deregulating capital markets and dismantling controls.

An era therefore is coming to an end. In the face of continued US overspending, de-dollarization threatens to force countries to return to the kind of dual exchange rates common between World Wars I and II: one exchange rate for commodity trade, another for capital movements and investments, at least from dollar-area economies.

Even without capital controls, the nations meeting at Yekaterinburg are taking steps to avoid being the unwilling recipients of yet more dollars. Seeing that US global hegemony cannot continue without spending power that they themselves supply, governments are attempting to hasten what Chalmers Johnson has called “the sorrows of empire” in his book by that name – the bankruptcy of the US financial-military world order. If China, Russia and their non-aligned allies have their way, the United States will no longer live off the savings of others (in the form of its own recycled dollars) nor have the money for unlimited military expenditures and adventures.

US officials wanted to attend the Yekaterinburg meeting as observers. They were told No. It is a word that Americans will hear much more in the future.

Dr. Hudson’s website is: