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These Gold Clauses were not in federal loans, bank deposits, insurance contracts, and other private agreements. When Roosevelt outlawed the Gold Clause, he stole billions from investors. In fact, a Harvard paper estimates this rule took $700 million a year from private investors who bought government bonds. Billions more were stolen from folks who lost money from the elimination of the Gold Clause in private contracts, bank accounts, and insurance deals. Eliminating the Gold Clause was so controversial, investors sued the government. The case went to the Supreme Court. Roosevelt was terrified his Debt Jubilee would be overturned. He even drafted a speech saying he would ignore the court if it ruled against him. But his political pressure worked, and the court ruled 5-4 in Roosevelt’s favor. Tens of millions of Americans lost massive amounts of their savings . And after booming, the stock market soon fell 50% in a single year . Investor confidence was crushed. Supreme Court Justice Harlan Fiske Stone vowed he would never buy another federal bond. Starting in the late 1960s, we saw another Populist uprising... a combination of economic and social upheaval. If you’re old enough to remember, think about the anger and resentment of the 1960s. The Black Panthers’ slogan was: “Power to the People.” The idols of the day were people like Latin-American guerrilla leader Che Guevara, Malcolm X, and Muhammad Ali. Of course, there were consequences... We had another Debt Jubilee in America about 40 years later...
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