Imagine, being the little capitalists you are, you invite your friends over to play a smashing game of Monopoly. As you’re selecting the pieces and sorting out all the money, the inevitable question arises, “Who wants to be the banker?”. Now, usually people just argue over this, or one is selected by some form of democracy, or everyone but one person is apathetic to being it – it doesn’t matter, the end result is one banker who is also involved in the game. However, this time instead of arguing over who gets to be the banker you decide to outsource that job to someone who is particularly close to you, i.e. a best friend, a boy/girl friend, etc., (from this point forward, I will refer to this as your best friend for clarity’s sake) to be the central banker.
At first, disregarding the emphasis of a particular relationship with the owner of the game, in this case you, this might seem to be better for all players involved. You think this would be the fairest way to regulate your game, knowing that your friends will try to one-up you in an endless cycle of trying to be victorious. You might now recall the special relationship that exists between the owner and the banker, which begins to give you some doubts. But, you write them off because all the other players think this is an excellent and revolutionary idea. You didn’t even realize that even without a special relationship between the owner of the game and the central banker, the game is rigged¹.
In monopoly there are only a few ways to cheat. One could not pay the owner of the building if the owner isn’t giving all his attention to the game, one could steal extra money from the bank, or one could miscount his roll to avoid dangerous landing spots. When there lacks a central banker or “third-party” regulator to enforce the rules, each player has a vested interest to protect his property, get paid, and hold the other players accountable for their actions. Remove this self-regulating force and it’s up to the discretion of the third party – in this case, a friend you have a special relationship with over the other players.
Naturally, corruption ensues. The third party now has full power to decide if Player A tried to skip out on paying rent, or if Player B rolled a 9 but only advanced 8 spaces, or if you (having that special relationship already developed) needed an additional $100 when passing ‘Go’. The third party receives a monopoly (no pun intended) on enforcing the rules. This happens because it was deemed legitimate, and as a result, the self-regulating players accepted that there is a figurative police officer so they can simply enjoy the game instead of worrying about cheaters.
In theory, this could go on forever as long as the owner and the banker were discrete about getting that extra $100 dollars every time ‘Go’ had been passed.The other players wouldn’t even realize they were at a huge disadvantage to their opponent (you) because you rigged the game by adding an outside party to the game.
This is essentially an elementary description of the Federal Reserve.
Much like the example, the Federal Reserve is considered an outsider from the political realm, just like your best friend. The Federal Reserve has acquired a sense of legitimacy by the people it is manipulating to better serve the special relationship they have with the federal government, just like the monopoly game. And they get to call all the shots, printing (or handing out) all the money they would like, or not like, to. Consequently, this allows them to rig the monetary policies, or the Monopoly game, for the benefit of themselves and the government as a whole.
When Nixon took the American dollar off the Gold Standard in 1971, it was the equivalent to when you outsourced the banker job to your best friend, who’s entire goal was to help you win. The Gold Standard in this Monopoly scenario would be the general checks and balances your friends relinquished when they allowed your best friend to be the unchecked regulator/enforcer of the rules and the money supply.
Just like the example, what naturally kept central bankers in check in real life was removed by their special friend – the U.S. Federal Government. Yet now we face the curious situation of letting all the other players, in this case all Americans, know that the game is indeed rigged for the people at the top; namely, the central bankers themselves and the greater U.S. Federal Government.
¹ The game would still be rigged despite a special relationship not yet existing because the central banker would find it is in their best interest to develop that special relationship with any, singular player. Likewise, the individual player will find it is in their best interest to develop this relationship too.
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