At Religion Dispatches, Julie Ingersoll has an excellent post on the extreme fundamentalist sect known as “Christian Reconstructionism” and its influence on the modern libertarian movement’s call to destroy the Federal Reserve: Better Dead Than ‘Fed’: Behind Palin’s Dig at ‘Unbiblical’ Fed.
While Ron Paul’s anti-Fed crusade is widely thought of as economic libertarianism, the roots of this combat lie in a theocratic reading of the Bible, arising out of the nexus between Paul (and now his son, Senator-elect Rand Paul), Howard Phillips and his Constitution Party, and Gary North and the Christian Reconstructionists.
For decades, the elder Paul, Phillips, and North have shared the libertarian economic philosophy of the Austrian School, which advocates a strict free market approach to an economy they portray in terms of individual choices and agreements rather than systemic forces. With respect to the Federal Reserve System in particular, they have argued against its fractional reserve banking, and its manipulation of interest rates to control economic ups and downs.
North, the architect of Christian Reconstructionist economic theory, and controversial libertarian economist Lew Rockwell both worked on Ron Paul’s congressional staff in the late 1970s. That collaboration continues today, even after reports during the 2008 presidential campaign that Rockwell had ghostwritten racist and anti-gay statements in Ron Paul’s conspiracy-minded newsletter in the 1980s and ’90s. They continue to collaborate through the Ludwig von Mises Institute, founded by Rockwell and the anti-“statist,” anti-New Deal economist Murray Rothbard, who believed Joseph McCarthy was “the most smeared man in American politics” in the 20th century.
Their work is also found at LewRockwell.com, where North currently writes, often in support of Paul. In promoting their libertarian economic views, Rothbard and Rockwell have, according to the libertarian Reason magazine, “championed an open strategy of exploiting racial and class resentment to build a coalition with populist ‘paleoconservatives.’”
While each of these figures comes to the table from different places, they come together in agreement on Rothbard’s anti-statism, which dovetails with North’s views. For North, the Bible limits the legitimate functions of civil government to punishing “evildoers” and providing for defense. Reconstructionist theocracy, based on the Reconstructionists’ reading of the Bible, gives coercive authority to families and churches to organize other aspects of life. In this view—one that also meshes with Tea Party rhetoric—the Fed’s control of monetary policy is a prime example of federal government “tyranny.”
North argues that the Federal Reserve is unbiblical because it usurps power not legitimately held by civil government (because God didn’t grant it) and it promotes inflation, which he says is nothing more than theft from those who are not in debt in favor of those who are.