Part 13: High-Scalers

I am a most unhappy man.  I have unwittingly ruined my country.  A great industrial nation is controlled by a system of credit.  Our system of credit is concentrated.  The growth of the nation, therefore, and all our activities are in the hands of a few men. 

We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in civilized world – no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men.  Woodrow Wilson

            Bartholomew “Buddy” Peoples, Executive Director of the Studebaker Institute called an impromptu staff meeting bright and early Monday morning for him and two other attendees in the fourth floor conference room: McKinley “Mac” Kopstein, Director of Security and Dr. R. Cinza Brown, Director of Strategic Planning & Business Development.  This wasn’t exactly his style because he was accustomed to giving people a few days notice between meetings which was much more efficient all around. 

But when Chairman Greese called him late the night before during the Super Bowl from his office at SI and asked him for an update on two important issues, he had no choice.  Anytime he got a call from Greese he got heartburn, and getting a call last night produced a very fitful evening of rest indeed, despite the fact that his home team Steelers won a thriller.  His boss explained to him how to handle underperforming underlings, “shoot the dogs, ride the horses, and feed the tigers!” 

                “Good morning guys, hope you enjoyed last night’s game,” Buddy mumbled after brief pleasantries, then immediately got to the matters at hand.  “Mr. Greese called me last night and asked I give him a briefing this week on the ongoing Archie Jefferson and Sam Noble document theft investigation, and progress thus far on Operation GERDA.  These topics have been dragging on for some time and he wants answers. 

As you know both he and the SI are extremely busy with many other projects right now helping the new administration with downsizing the federal bureaucracy.  Let’s start with our old nemesis the Jefferson document theft.  Mac, please take it from here.”

                “Well Buddy, we’ve done extensive surveillance and investigation regarding this affair.  I have with me here a number of classified files including correspondence, transcripts of phone calls, emails, snail mail, and photos collected thus far,” and with that Mac pushed to the center of the conference room table stacks of materials.

                “What about text messages Mac,” Buddy queried.  “Nope, nothing, these two have cell phones but hardly use them, cheapo Nokias.  The communications we have from Noble’s wife is all handwritten from letters, nothing electronic, as are letters she received from relatives in Brazil,” Mac said in feigned disgust.  “Remember that joker over at State, that guy Atwood?  He has actually given us some interesting things.”

                With that Mac explained to his two colleagues what he had discovered thus far.  Apparently Noble had sent emails to the State Department Human Resources Department asking about cashing out his 401k when he retires next year.  He also asked HR about how receiving his federal government pension in Brazil could be handled, asking about electronic transfer to a local bank down there.  Likewise he queried the Social Security Administration on how to receive his benefits via bank transfer to Brazil, and how Medicare would be handled in a foreign country.  He also asked HR about IRS tax obligations when he retired to Brazil as an expatriate.

                “Apart from what we got from Atwood, my FBI guy learned other things about Mr. Noble. He used the Vienna city library to research realtors online, with the help of a librarian, which we assume has to do with a desire to sell his townhome over the next few months.  The correspondence mailed to Brazil by his wife, and responses by her relatives which we had translated from Portuguese into English, also shows plans for moving to Brazil a little over a year from now, to her hometown Campo Dourado,” Mac concluded.

                Buddy’s response, “So what does Noble intend to do when he gets down there, open a checking account on the Bank of Podunk!”  Mac and Buddy guffawed, Cinza just smiled.

                “But on a serious note, does the U.S. have an extradition agreement with Brazil, in case we need to get our hands on this guy,” Buddy continued.

                “Yes sir, but realistically Noble would be a long way from the reach of U.S. federal law enforcement where Campo Dourado is located, I mean jungle country.  It’s a small town of just 20,000 people with a lot of the inhabitants from local indigenous tribes, you know, ignorant Indians.  Local authorities in the Brazilian outback can be very hard to deal with and if Noble wanted to disappear, his wife’s people could hide him in the wilderness for years.  He’s an old guy so time is on his side should he choose jungle over jail,” and there were more laughs except Cinza.  Mac’s words were slightly offensive to the African American.

                Actually, Buddy wasn’t worried about Sam Noble and his wife because they might not even be around a year from now, or anyone else for that matter even tangentially associated with the document scandal, unless SI’s investigation into the matter can be concluded before Operation GERDA is presented to President Hapgood.  That meant six months max.  Chairman Greese made this clear to Buddy and Mac by glance and innuendo nine months ago with his so-called Plan B should things go sideways. 

Mac was onboard from the get go, but gradually Buddy had also come over to the dark side.  Greese would never give the order himself; it would have to be Mac and Buddy.  A team of “cleaners” was on standby at a CIA Black Site in Panama waiting for the green light with a simple three-word directive: everyone must go.

                “Mac, what about the material we received thus far, have we learned anything more about what he’s writing about and why?  Have we determined anything about his handler or cut-out Duke Mitchum,” Buddy wanted to know.

                “Nothing on Mitchum.  I had psychological profilers at the FBI look at everything including personnel files and the manuscript Noble has been sending over to Jefferson.  They think Noble is a zeitgeist wannabe, someone who feels he is in some way a prophet of his era, and possesses delusions of grandeur as being some kind of unique spirit of our time.  This doesn’t necessarily mean he’s dangerous however, just that he may need professional clinical help and/or certain types of medication.”

                “Okay, so in other words the profilers don’t know shit.  Dr. Brown, you’ve been awfully quiet, what do you think about this mess?”  And with that Buddy threw the problem in his lap.

#

Cinza’s IQ was higher than the other two Studebaker executives combined.  He was a voracious reader with photographic memory and had mentally absorbed data from all the files, all the chapters of Noble’s manuscript, and seen all the photographs taken at the homes of Jefferson and Noble.  He missed nothing, but experience had taught him to never let anyone see all your cards at once. 

Take your time, go slow he had learned, and use the ignorance of others to your advantage.  He wouldn’t even be in this meeting if Chairman Greese had not asked him to make a photocopy of his “Atlantean Geodesy” for Greese’s files that got him in trouble in the first place.  Greese was not computer literate so knew nothing about using a digital file, preferring only paper copies instead.

“Thank you Buddy, for allowing me to participate in this meeting.  I think my take on the affair might be somewhat different than that of you two gentlemen.  I see here two regular guys, both Vietnam vets, in the twilight of their small lives.  I have great respect for veterans.”

Cinza’s father served with the Marine Corps in Vietnam and to this day never mentioned anything to him about his military service although he knew his dad fought in the bloody Battle of Hue.  “There is only one real crime committed, and that was by Jefferson, for which we have forensic evidence to convict Jefferson should we chose to have him arrested because his DNA is on the shredded documents he stole,” Cinza opined.

Mac’s laughing response was, “Holy shit Cinza, you sound like a TV episode out of CSI!”  Buddy just glared at Mac and said, “Dr. Brown, please continue.”

“The point I’m trying to make is that Mr. Noble has done nothing wrong that we can prove.  True, he is Jefferson’s friend and true, he owns an M-16 assault rifle with automatic selector switch, one of the older Armalite models, but we gained that information from entering his home possibly illegally, with all due respect to the Patriot Act.  Having said that, 10 million Americans own assault weapons which as the Constitution is written today is not a crime. 

If we can keep any legal action Mr. Greese is considering to prosecuting only Jefferson, and not worrying about Noble, than we have only one person involved.  One person is not a conspiracy.  If we insist on involving Noble, then we have at least two people involved, and that is the definition of conspiracy.”

“Hmm, not bad Dr. Brown, not bad at all.  I shall take what you say under advisement and discuss the subject with Mr. Greese.  Mac, the investigation is not concluded by any means but let’s focus more going forward on how Jefferson got those documents in the first place.  We’ll give it a few more weeks and then we’ll call Jefferson in for a little chat and lay the hammer down.”

But Cinza was holding something back, and that was some of the themes Noble had included in his manuscript.  “Too many coincidences,” he thought.  “I mean it’s weird enough he writes about gold, and touches briefly on the gold standard in his first two chapters, but he also talks about other topics I wrote about in my ‘Atlantean Geodesy” like Atlantis, Scythia, Antarctica, the Ice Age, and ancient civilizations, and none of these subjects had appeared on the last three pages of the ‘Geodesy’ but on previous pages!” 

To Cinza the most disturbing coincidence though had to do with the metal clamps used in antiquity to hold precisely cut stones together during construction of pyramids and temples around the globe. Noble referred to these as “bowtie” shaped metal clamps in his first two chapters, and what Cinza called tenents in one of the legible documents stolen by Jefferson. 

And the color photos taken in Noble’s den when the Feds went in without a warrant to snoop around, those pictures that showed four stacks of paper with so-called paperweights shaped like tenents, piqued his curiosity.  Where did they come from, and how did Noble get them?  All this was still a mystery and Cinza was dying to find out.

#

“Alright then gentlemen the other subject needing our attention is the status of Operation GERDA.  Chairman Greese said he had sounded out some influential members of Congress about the United States returning to the gold standard as a way out of our worsening mess, but the bureaucrats are lukewarm about the idea with the exception of a Congressman from Texas. 

Greese would like to hear more ideas Dr. Brown on how to convince people into supporting GERDA,” Buddy began.  It was the chairman who first had the idea for this project in the first place after Hurricane Katrina back in 2005 and he correctly saw that the economy was about to enter a severe recession, which it did in 2008. 

Greese wanted a project bigger and more lucrative than the Armalite project was for the Institute, one wrapped in yellow ribbons that would financially bail out the United States now and for all time.  Greese reiterated time and again he wanted America to always be in the catbird seat.  We needed more money to fight all our wars and bail us out of one economic recession after another. 

It would be hailed as a great New Deal to help all Americans, and especially to the delight of FDR-worshipping Democrats who now had a newly elected president.  Once GERDA – Gold Extraction and Relocation for Defense of America - was launched America would never again have to be concerned with financial insolvency and the 21st Century would become the Golden Era of our country – “Katie bar the door!” – which Greese felt was our God-given right.

"Mac, this is a subject that may or may not be of interest to you so you can stay or excuse yourself, it’s up to you.”  With that Buddy also added a slight wink which he didn’t think Cinza saw.  Mac smiled, leaned back, crossed both arms and stayed put: he loved watching Dr. Brown squirm.  “Dr. Brown, the ball is in your court sir,” and with that Cinza began.

“What the hell was that wink about!” Cinza thought.  He would have to be careful going forward on what he said and to whom he said it.  Chairman Greese was growing more and more unhinged daily because his baby, Operation GERDA, was losing favor with the Studebaker board of directors. 

Cinza already had one strike against him because his “Atlantean Geodesy” had been a dud.  Looking for lost hordes of gold from antiquity was just stupid in retrospect but not its premise.  He would try one more time to try and explain to these dumbos why returning to the gold standard was America’s only hope.  One more calamity, one more crisis here or abroad could throw the country’s economy into an abyss that it may never climb out of.  He would keep his comments to these two brief.

“Gentlemen,” Cinza said addressing both Buddy and Mac, “the very foundation of Operation GERDA is solid and there are two tiers pertinent to supporting its rationale.  First, we must convince Washington leadership that it is of paramount importance to convert our economy to the gold standard.  Second, having done that, we must by then have found access to enough gold, huge quantities in fact, to back our return to the gold standard or it won’t work.  The project in my opinion is a go once the volume of gold is identified and its extraction is considered a guaranteed outcome, even if the extraction process and relocation takes several years. 

As you both know, my white paper last year entitled ‘Atlantean Geodesy’ attempted to locate enough gold, vast quantities I believe have been lost to antiquity, to proceed with tier one, but in retrospect and I admit it, it was fanciful and impractical.”  Buddy concurred with Cinza, and Mac just snickered.

“As you know America’s recession worsens each day and the contagion is spreading globally.  That should not come as a surprise to anyone since despite negative economic growth for six quarters we still represent one-quarter of the world’s GDP.  Let me again explain why we and by extension the rest of the planet must return to the gold standard and hopefully you can re-emphasize this message to Mr. Greese and other board members at SI.”  Cinza had written paper after paper, complete with charts and diagrams, these past two years but apparently no one read them. 

He had gotten into the weeds with sophisticated “road not taken” modeling using high speed computers and special algorithms he designed personally.  He looked at everything in America’s past: the price per troy ounce of gold since 1792, the causes of historical “Panics,” taxes and government spending, international markets, and a host of other complex variables.  If anyone knew more about the gold standard than Cinza, he would like to meet him or her.  He then began his layman explanation.

#

 The United States has lived through recession after recession since its founding.  But back in the day, they didn’t call them recessions.  They called them “Panics.”  There were sixteen major Panics beginning in 1797 up until the Great Depression beginning in 1929.  Cinza said this year 2009 was shaping up to be possibly the worst financial crisis ever.  The current great recession began in 2008 and was getting worse. 

The collapse of the housing market and the financing of foreign wars were having an impact on worldwide credit.  Traditional financial institutions in New York were declaring bankruptcy and banks heretofore thought too big to fail were on the verge of collapse.  One more shock to the system and the American economy would collapse.

In the early days of the United States, its monetary system was comprised mainly of two precious metals, gold and silver called specie, which Andrew Jackson termed “a manly coin.”   In 1792 the country officially adopted the Bi-Metallic Standard of the two metals which stayed into effect 42 years until America officially adopted the gold standard in 1834.  National debt was almost nothing at the time.

In 1933 Franklin Delano Roosevelt cut all domestic dollar ties with gold allowing his government to pump vast quantities of money into the economy and lower interest rates to spur business re-growth and re-employment during the Great Depression.  The U.S. continued to allow foreign governments to exchange dollars for gold until 1971, when Richard Nixon killed the last remaining vestige of America’s gold standard.

Since departing from the gold standard decades ago, many economist and financial experts have repeatedly warned U.S. Presidents, Congressmen, Treasury Secretaries, Fed Chairmen, and whoever else would listen that when the American Republic was created its Founding Fathers always intended that the government needed to pay as you go, and the only way to ensure fiscal and monetary responsibility by irresponsible bureaucrats, and fiscal austerity, was to make gold the true foundation of the country’s currency. 

National debt would be held in check as would government deficit spending.  Critics of just printing fiat money, Federal Reserve Notes backed by nothing but hot air, warned that history always showed that a gold reserve was needed by countries engaged in international trade.  The printing of fiat money with no gold backing was foolish as experienced by the Weimar Republic and hyperinflation. 

It was Germany’s economic collapse that led to the rise of Adolf Hitler, who emboldened other regional despots like Mussolini and Stalin to push fascism and socialism ideologies across Europe. 

John Maynard Keynes, the famous British economist, whose theories were very influential in world economics during the years leading up to and following World War II, did not support a gold standard.  Keynes argued that supply and demand must equal in the long term, although as he did once admit in his most famous aphorism, “in the long term we’re all dead.”  However, in the short-term, supply and demand can and always will be out of balance. 

If there was too much supply, depression resulted; too much demand and inflation broke out.  He ignored Adam Smith’s invisible hand metaphor and conventional laissez faire thinking regarding government intervention arguing that it should indeed use fiscal policy, tax and spending programs, to stabilize the economy.

To dig out of a severe economic crisis, the government needed to dramatically increase its spending, cut taxes, or do both to stimulate aggregate demand – the total spending by individuals, businesses, and government.  Keynes found an avid supporter in FDR during the 1930s; government spending was the silver bullet FDR was looking for to climb out of the Great Depression. 

Keynes thought the gold standard was illogical, unreasonable, and too confining to allow for rapid stimulation of effective demand, and although he never advocated doing away with gold entirely as a monetary metal, he did call it a “barbarous relic.”  Monetarists, those that believed controlling interest rates and the money supply were keys to managing efficiently the economy, disagreed with Keynesian macroeconomic theory and blamed policies embracing his theories as the cause for stagflation.  It was Keynes and FDR who green lighted unchecked government spending by the political class, both Republican and Democrat, year after year up until this very day.

#

                Dr. Brown paused and asked, “Any Questions so far.”  Mac Kopstein just shook his head from side to side but Buddy Peoples spoke up, “So let me get this right, Franklin Delano Roosevelt took the advice of some snooty Brit economist and started us down the road to the doomsday scenario we’re in now, is that what you’re saying?”

                “Not at all Buddy, on the contrary, I mean what choice did FDR have?  The Stock Market crash caused stocks to lose 90-percent of their value, and unemployment reached 25-percent.  Unemployment in some large cities hit 80-percent.  Two-thirds of the country’s GDP depends on consumer spending, so if FDR couldn’t get people working again the societal calamity would have worsened.  That’s why he come up with major public works projects and federal programs like the Tennessee Valley Authority, CCC, CWA, FSA, and NIRA to name a few, and the Social Security Act he passed as a safety net for elderly retirees.  These were mega-projects under the New Deal."

At which point Mac spit out, “Oh yeah, like the construction of the Hoover Dam!” at which point Cinza politely countered, “Actually no Mr. Kopstein, the Hoover Dam was started before FDR took office, under President Hoover’s administration, as the Boulder Dam.  In 1947 it was renamed the Hoover Dam in President Hoover’s honor.”  Mac just took on the facial appearance of a puffer fish while Buddy rolled his eyes, as Cinza continued his explanation.

From then on government was on steroids and just kept getting bigger and bigger.  Dr. Brown likened the big government phenomenon to a virus whose priority was to perpetuate the survival of its species first and foremost.  Because it’s so big, no one individual can ever be held directly accountable for making a mistake or breaking the law.  When in doubt just throw more money at the problem because the bigger the lie, the easier it was to get people to believe it. 

But even after all the government spending it still took America’s entry into World War II to shock our manufacturing base back to full capacity to escape the Depression.  After that America became a super power, cornering half of the world’s gold bullion supply.  Buddy Peoples quipped, “No shit, why do you think the Studebaker Institute is so profitable, it’s all that sweet government money!  The only difference between men and boys is the size of their feet and the price of their toys.”  Both Buddy and Mac had a good laugh.

Dr. Brown could see he was losing his audience so tried to make things as simple as possible for these two dunderheads.  “Despite everything, Franklin Delano Roosevelt is one of our greatest presidents and by the end of World War II the United States was at the peak of its economic might, a super power in military and financial strength and we would remain so.  After the end of the war our national debt was only $260 billion dollars, and by 1960 had only reached $320 billion.  But by 1992 it had ballooned to $4.2 trillion and this year we could hit $9 trillion!” Cinza emphasized.

He explained that this was the accumulated debt government has run up on its credit card over and above how much it has taken in from hardworking men and women in taxes since the founding of the country.  This is what government has overspent!

“Holy shit, so how high do you think it’ll go? Mac spoke up with a surprisingly cogent question.  Cinza thought for a second and said, “Hell, in this economic environment and with all the bailouts and investments we’re going to have to make, I could see us doubling that to $18 trillion easily in a couple of years.”

“Why the hell doesn’t Congress do something!”was all Buddy could manage to say.  “Well Buddy, that’s why we’re pitching Operation GERDA – Gold Extraction and Relocation for Defense of America – to the current administration because we’re in uncharted territory, this could be worse than the Great Depression,”  Cinza replied.

Cinza knew that if the President and Congress kicked this can down the road yet again with massive government expenditures, just the staggering annual interest payments associated with debt servicing would impoverish future generations of Americans and national debt would still keep growing and growing. 

“So that takes us back to the gold standard and the pros and cons doesn’t it Dr. Brown, and those are?” Buddy said throwing the subject back to Cinza who then continued with his explanation.

The benefit of a gold standard is that a fixed asset backs the money's value.  It provides   a self-regulating and stabilizing effect on the economy. The government can only print as much money as its country has in gold.  This discourages inflation, which is too much money chasing too few goods.  

It also discourages government budget deficits and debt, which can't exceed the supply of gold.  Over time, the national debt will start coming down, and over a longer period of time will disappear altogether.

A gold standard rewards the more high productivity nations like the United States.  The more gold held in reserves, the more money it can print. This boosts investment in manufacturing jobs and less offshore sourcing of goods and services.  The money and jobs stay home. 

The gold standard will spur exploration and lead to more gold being processed from within the earth.  It's why Spain and Portugal got rich after discovering and exploiting South America in the 1500s during the Age of Discovery.  It also prompted the Gold Rush in California and Alaska during the 1800s and propelled our God given right to Manifest Destiny. 

One problem with a gold standard is that the size and health of a country's economy are dependent upon the quantity of gold it has in its vaults, like Fort Knox, which in America’s case means it’s going to need a lot of gold, a shitload of gold, an amount so large it exceeds the amount of all known gold mined since the beginning of recorded history – and Cinza identified in his “Atlantean Geodesy” – more than 130,000 metric tons. 

He did not believe so-called “experts” who said only ten-percent of this amount or 13,000 tons had been mined prior to 1850 A.D. – Cinza felt the quantities mined in antiquity had to be much, much larger, perhaps as much as a million tons.  The board of directors of the Studebaker Institute shot down his theory when they shot down the “Geodesy.”

#

Returning to a gold standard would constrict a bureaucrat’s ability to manage the economy. Particularly now with the raging war in the Middle East the government could not be restricted by its deficit spending.  Central banks have consistently caused more problems than they have solved wherein Andrew Jackson was right.  The Fed would no longer be able to reduce the money supply by raising interest rates in times of inflation. Nor could it increase the money supply by lowering rates in times of recession.  

In fact, this is why we should return to the gold standard. It would force fiscal discipline, balance the budget and limit government intervention.  The forced austerity would make the government lean and mean, rather than bloated and incompetent, or as President Ronald Reagan once famously said, “Government is not the solution to our problem; government is the problem.”  But the United States could not unilaterally convert to a gold standard if the rest of the world didn't.  
            So this makes the job even harder for the President and Congress; they would not only have to convince Americans that we need to return to the gold standard, but leaders of foreign countries as well.  The United Nations would not be a problem because we can always bribe those guys, but that support alone might not be enough.

“Well Dr. Brown therein we have the nub don’t we, what you call your Operation GERDA tier two?  To get to tier one, return to the gold standard, you said it was conditioned to finding vast quantities of gold, your tier two.  You also said the quantity needed was likely more than the 130,000 metric tons you had previously identified.  

That being said, how much gold does the Studebaker Institute tell President Hapgood, a big proponent of military spending, and Congress our financial system will need in order to make returning to the gold standard something viable and without major risks, so they can in turn convince the American voter?  And that said, how and where do we get it?  Where does all this gold come from?”  Buddy queried a suddenly silent Dr. Cinza Brown.  “Damn good question,” Cinza said after a long pause.

                At this juncture Cinza didn’t know whether he should be vaguely clever or cleverly vague, so he decided to just blurt out a number.  “I think Buddy, we will need to identify approximately 900,000 metric tons of gold to make GERDA viable,” he said rather meekly.  Buddy Peoples and Mac Koptstein just looked at each other dumbfounded, and then Buddy asked incredulously, “Huh, what was that?  Say again please?”

#

“How much gold would the United States need indeed,” Cinza thought.  Truth was no one could really answer that question because there were just too many variables, including the prevailing price of a troy ounce of gold on the one hand and economic dynamics on the other.  Cinza remembered when he tackled answering that question for Chairman Greese and the Board of Directors of the Studebaker Institute.  You had to look at America’s balance sheet, its debits and credits, and he doubted very much if Buddy Peoples or Mac Kopstein would understand that.

                After getting the go ahead for Operation GERDA from the chairman, Cinza had turned to econometric modeling in order to put a total dollar number on the country’s “financial imbalance,” in an effort to apply a massive electric shock to the system. 

Although his credentials from the Studebaker Institute usually gave him VIP status when dealing with federal agency after federal agency, much of the information he obtained was impossible to cross-reference and correlate – Washington’s Office of Management and Budget’s numbers had almost no connection to reality.  It was the old Potomac two-step.

The more Cinza researched, and the more he dug, the more he came to realize two immutable facts: the federal government had manipulated and lied for so long about the state of budgeting and actual expenditures that even they didn’t know anymore what was real and what was Memorex; and the extent of the mess the United States was in financially just kept proving to be worse and worse the more he peeled back the onion layers.

                After months and months of research and trying to show coherently as possible the present-day unfunded liability worth of all of America’s financial commitments and requirements, he added the current federal debt held by the public plus the private individual, state, and corporate debt, plus the present-value of all future non-interest spending, minus the present value of all future federal and private receipts. 

Resulting from this simple fifty-year-forward-looking model, and after netting out anticipated tax revenues to get at core deficits, he had first calculated a national federal debt of $9 trillion; present-value unfunded commitments for Social Security and Medicare of $56 trillion; current state, private-individual, and business debt of $10 trillion; national public-sector long-term liabilities, including retired civil servant and military personnel life-long retirement benefits, of $32 trillion; Federal Reserve Note debt in circulation of $2 trillion; and new federal project spending under the rubric “national security projects” of $30 trillion. 

                Included in the new national security projects price tag was not only defense spending and Operation GERDA, which thrilled the board of the Studebaker Institute immensely, but a whole host of ancillary projects which would line the pockets of the military-industrial complex for decades to come to fight endless wars anywhere on the planet it chose.  Congress would have to act quickly during the first 100 days to pass new legislation after GERDA became official policy, a speed unheard of since the days of FDR. 

#

With the windfall ensured, the Department of Defense would wholeheartedly embrace Operation GERDA from the get-go and the Studebaker Institute would be halfway home as soon as the presentation to the President of the United States, his Cabinet, and advisors concluded.

                According to Cinza’s calculations, the U.S. was in the hole $139 trillion!  When the United States abandoned the gold standard in 1933, it had a gold supply of 12,000 metric tons.  Now in 2009 the country only had in its Federal Reserve vaults across the country, including New York City and Fort Knox, only 8,200 metric tons of gold worth $262 billion at the prevailing price per troy ounce. 

Compared to how much it was in the hole, the U.S. had managed to leverage its debt-to-gold-ratio to 530:1 and the economy was just barely hanging on by its fingernails.  Our economic foundation was built on house-of-cards debt! 

The premise of “national security risk” was unanimously accepted and approved by the SI board as the basis for Operation GERDA only after Cinza reduced his analysis into the simplest binary terms possible, “Does America have a liquidity problem of biblical proportions or doesn’t it?” to which all could agree, “It did.”

                It was during the same board meeting when Cinza was giving his board presentation that a former Under Secretary of the U.S. Treasury and current SI board member Richard “Don’t Call Me Dick” van Bohlt made a most profoundly stupid pronouncement and said, “Why doesn’t the President just give the Fed permission to print more money?”  Hyperinflation in the economy à la Wiemar Germany after the First World War was obviously not the least bit of concern to the ex-fed and history buff Dick.

                Cinza thought about his comment later, though, and found a nugget of wisdom there although totally unintentional by Dick of course.  America would in fact have to print many more Federal Reserve Notes as well as issuing massive amounts of new debt instruments in the way of Treasury bills and bonds, because not to do so meant collapse of the country’s economy – so bad would the coming depression be that we could in fact see what the Civil War and the Great Depression were not able to bring about: the Balkanization of the United States. 

Having accepted logically that more notes had to be printed, Cinza knew the only remaining natural corollary to that hypothesis was that something other than air would have to back up the printing, and that tangible something could be nothing but gold to regain and restore faith and confidence in America.  It had to be the noble metal; there just wasn’t any other choice.  So here, once again, history was repeating itself.

Cinza used the prevailing market price for a troy ounce of fine gold for his base calculation, knowing full well the price would rise with the announcement that America was returning to the gold standard at first, but over time, it would fall much lower than the prevailing panic-price assuming everything went according to plan. 

But since he had penned his “Atlantean Geodesy” the economy had worsened considerably.  The debt would soon double, as would the need for more gold than the 130,000 metric tons he initially identified, much more. 

To fast track Operation GERDA and minimize the immediate fallout, mostly negative, in going back to a gold standard, the U.S. Treasury would now need access to $4 trillion worth of gold bullion to cover more Federal Reserve Notes in circulation, $8 trillion to pay back the Social Security Trust Fund and exchange the worthless IOUs held in a West Virginia filing cabinet for gold certificates, $18 trillion to pay down the anticipated national debt resulting from wars and corporate bailouts, and $10 trillion to front-end load a batch of new initiatives Washington would need to undertake. 

This included national infrastructure projects and long-term ancillary national security projects, including startup fees that SI will charge for overseeing the success of Operation GERDA.  The total came to $40 trillion, which even at increasingly higher prices for a troy ounce of gold still came to a staggering 900,000 metric tons or seven times the weight of 130,000 metric tons of all known above ground gold ever mined, identified in Cinza’s “Atlantean Geodesy!”

#

                Cinza never really envisaged the return to a gold standard with 100-percent reserve backing.  He recommended keeping the Federal Reserve Bank, and maintaining their fractional reserve system but at a modest 10:1 ratio, coincidentally the same as the old Knights Templar goldsmith ratio, as a self-limiting control mechanism.   

This meant there was a buffer stock to cover the total hole the United States was in of $139 trillion with plenty left over.  Using this logic, 900,000 tons of gold could be leveraged to a value ten times what it was worth as a stand-alone metal – to $400 trillion, which would provide the United States with more than enough runway to finance the country’s new golden age well into the 22nd century! 

America would also be in the advantageous position of selling and/or lending gold to its allies, but withholding it from its enemies.  No matter how many worldwide scenarios of econometric modeling Cinza ran on the Studebaker Institute’s Cray supercomputers, the far-reaching implications for the international monetary and trading system were difficult to fathom. 

When, not if, the United States unilaterally announced its plan to return to the gold standard with access to a huge cache of gold reserves, the international confidence in the dollar and the U.S. economy would soar overnight, producing short-term heavy buying of the dollar, causing a drastic appreciation of it and a depreciation of the rest of the world’s fiat currencies. 

                The price of gold would increase dramatically, but like the buying of the dollar, the frenzy would soon die down because speculators, knowing that their profit potential after the official gold price stabilized would be nil, would no longer buy gold.  Apart from speculation in stock, ETF, and commodity markets, foreign nations would have no choice but to adopt a gold standard as well, and Cinza predicted the major industrialized countries would want to join the U.S. in a matter of hours because the alternative was to watch their currencies become worthless. 

Although it was difficult to predict with any degree of certainty the consequences of a unilaterally established gold standard by the United States, it seemed beyond doubt that such an announcement would cause the disruption of world money markets necessitating a global realignment of interest rates, foreign exchange rates, and the relative trade position of America and its partners – it was safe to say that the U.S. would be in the catbird seat regarding positive balance of trade statistics for decades, if not centuries, to come.  The American Stock Market and new employment opportunities for citizens would take off like a rocket! 

The burden of monetary adjustments, given the relatively small balances of monetary gold reserves maintained by the treasuries and central banks of all major economic powers, would severely strain the capacity of governments to cope in a number of countries, even those countries with large oil reserves since they were black gold rich but yellow gold poor.  The price of a barrel of crude oil would fall dramatically as OPEC and its member states looked to the U.S. for supplying them with gold stock – once you had’em by the balls, their hearts and minds will follow!

                But after all was said and done, the major industrialized nations would join the United States in adopting a gold standard, and a reformation of the international monetary system would be needed since a fixed-exchange rate system, pegging foreign currencies to the U.S. dollar once again, would need to be agreed to by all member countries of the IMF. 

Third-world countries would want economic concessions like foreign-debt forgiveness or at a minimum long-term refinancing at zero interest rate, a position that the United States would support wholeheartedly and in so doing begin recovering its tarnished image from negative press coverage around the world.

                Cinza continued to work his numbers; he didn’t have to worry about diplomacy and international opinion on the merits of Operation GERDA.  That would be President Hapgood’s problem, but if there was one certainty in global geopolitics it was that “might makes right” – if the U.S. could drastically increase its gold supply, everything else would fall into place. 

#

                So now rather than to get in the weeds with Buddy and Mac, he just reiterated again what he had just said, “We will need to identify the whereabouts of 900,000 metric tons of gold.”  Buddy appeared to be at wits end and Mac just smiled, “Dr. Brown, how the hell do we do that!”  The staff meeting went a lot longer than all three had planned so Cinza felt it was time to wrap it up. 

“With the help of Chairman Greese, I’m trying to set up a meeting over at the U.S. Geological Survey to determine where the richest finds of gold ore are most likely found on the planet, and once that’s determined, chart a course of action which will ultimately include a massive mining operation like never seen before. 

But I’m getting some pushback because all federal agencies, the USGS included, have implemented a drastic reduction in force so bureaucrats are losing their jobs in droves.  The Geological Survey must think I’m just another consultant sent over to look at ways to trim more fat.  RIFs scare the shit out of D.C.”

                “Well good luck Dr. Brown, I’ll loop back with the chairman and fill him in on our meeting.  I suggest we end this now so you are excused sir and thank you very much, this has been most enlightening.  Mac, do you mind holding back for a second,” and with that Buddy wrapped it up and politely dismissed Cinza. 

Once Cinza had left the room, Buddy instructed Mac Kopstein, “Okay, all that horseshit Brown spouted about not worrying about Sam Noble but rather focusing our full attention on Archie Jefferson, forget it.  If I told that to Greese he’d dropkick my ass out of the building and rightly so.  Keep that ‘cleaner’ team on alert in Panama.” Mac gave the thumbs up sign, said nothing more, and walked out of the conference room with his files.

#

            “Wonder what those jackasses are saying behind my back, must have something to do with that wink,” Cinza thought to himself.  The comment earlier in the day from Mac about the Hoover Dam had been stupid and clumsy, but it did trigger a few fond childhood memories.  He very much resented being mocked by the likes of Mac Kopstein and Buddy Peoples both of whom he considered to be intellectually inferior morons.

Nobody laughed at R. Cinza Brown back in 2002 when he turned in his doctoral thesis although a few people certainly wanted to; they couldn’t because he was generally considered one of the smartest young men to ever attend the Economics Department at the University of Maryland and was a perennial summa cum laude while climbing every rung of the higher education ladder. 

To avoid being stuck in the economist’s narrow mindset and show his academic versatility, Cinza even took extra courses and earned enough credits at the university to be awarded an advanced degree in anthropology as well, a subject he loved but one that would never afford him the type of lifestyle he desired. 

Cinza had done pretty well for himself considering his humble origins.  After leaving the Marine Corps his black father, Frederick Douglas Brown, became a letter carrier for the U.S. Postal Service.  Judging by the number of old Marine buddies who stopped by the house for visits, “Downtown Freddy Brown” must have been really something in his younger days.  Of average height and build, he nonetheless had a booming drill instructor’s voice and everyone in the neighborhood respected Sergeant Freddy.  

He flew the American flag on the front porch every day until he died, not that long ago.  Freddy was a Vietnam vet like Sam Noble and also like Noble, Cinza’s father admired America’s big construction projects like the Transcontinental Railroad that many ex-slaves had worked on after the Civil War.

Cinza’s mother Becky was a white elementary school teacher and the family had always lived in a small yellow house in a lower-middleclass neighborhood on the outskirts of Baltimore – located not far from Fort McHenry – where Cinza grew up with three younger siblings.  Whatever shortcomings there were at the public school, Becky more than made up for after school with intense study sessions. 

The Sergeant said attendance was mandatory as was Sunday attendance at the First Baptist Church so that was that.  Cinza earned two doctorates, in economics and anthropology, his two younger brothers both became lawyers, and the youngest sister, Sarah, graduated from Annapolis and became a Naval Aviator.

His first name was Randall and growing up everyone called him Randy, but after college he preferred to abbreviate it using only the first letter, choosing instead to be called by the middle name that his father said was part of his Eastern African heritage.  His family still called him Randy, and a few close friends, but everyone else began calling him Cinza.

He had gotten the highest grades in class since kindergarten and had an IQ of 184, so knowing he was different from other boys didn’t bother him in the least.  He was effeminate and didn’t date girls in high school.  It was a different era back then, there was much less acceptance of people’s personal choices when he was growing up but his family never chided him or mocked him for being gay, they accepted him and loved him the way he was. 

His goal in life was to be rich and famous and move down to Washington and get himself a high paying job with some think-tank or consulting firm.   Randy knew a Ph.D. degree in economics was always in demand and that’s what he was shooting for – he never dreamt he’d eventually get a job with the prestigious Studebaker Institute.

The summer after Randy graduated high school and before college, Sergeant Brown decided the family needed a road trip to see his favorite construction project – Hoover Dam.  The Sergeant had heard many stories about the dam growing up, and now he wanted to see it firsthand with his own family. 

It was the most memorable trip of young Randy’s life, and he can still recall the old black and white photographs he and his father saw hanging on the walls of the Visitor Center and can remember clearly what the captions and haunting personal stories said beneath the photos, and what his father told him at the end of the tour.  Randy wrote an essay for his father after returning home to Baltimore, that Sergeant Brown said was the best present he ever got.  His dad read the essay many times over the years, those now wrinkled and worn pages and he choked up every time he read them:

#

The construction site for the Boulder Dam, the original name of Hoover Dam, was located on the Colorado River thirty miles east from the dirty little frontier railroad crossroads of Las Vegas.  It was at the beginning of the Great Depression when thousands of unemployed men and their hungry families crowded into southern Nevada, begging for work, three square meals a day, and a roof over their heads. 

Pushing to start construction quickly and provide people with employment, work started even though a new support city called Boulder City had not been erected when the first dam workers arrived in early 1931 and wouldn’t be ready for occupancy until more than a year later. 

But nobody cared; they had paying jobs so everybody pitched in and built a temporary shantytown home along the muddy banks of the wild Colorado River they called Ragtown.  Native Murl Emery, boatman of the Colorado, who owned a small store and tourist facility nearby recalled the crowds of people he watched moving into this vast squatter settlement sprawled across the desert floor and said, “People came with their kids.  They came with everything on their backs.  Their cars had broken down before they got here and they walked.  No one helped them.  The government would have nothing to do with them.”

Velma Holland described the scene when she arrived at Ragtown in 1931 and said, “We left Las Vegas and came out to the river.  The moon was shining and that river was the most beautiful silver strand you ever saw.  We got up the next morning, I looked out and it was awful – tents, big wood-colored stuff that looked so beautiful the night before in the moonlight.”  That spring and summer of 1931 was the hottest on record when on July 24th the temperature reached 126-degrees Fahrenheit by midday. 

Erma Godbey got to Ragtown in June with her husband Tom, who was looking for work and she remembered, “It would routinely get to be 115 degrees by nine in the morning and it wouldn’t get below 100 degrees before nine at night.  You could see the heat dancing off the cliffs.  For my littlest baby, the one that was only five months old, I would put a wet sheet around her crib so the air would blow through it.  But it wasn’t enough.”  The heat rotted the food or black ants got to it first; and freshwater was a serious problem since the river was muddy and even boiling it didn’t help prevent frequent outbreaks of dysentery from sickening the encampment. 

Sanitary facilities were primitive and ditch latrines were the norm, sprinkled with slaked lime to control stench and disease.  Yet Ragtown grew into a community, with makeshift businesses, church services, and schools – and children took as pets kangaroo rats, lizards, snakes, and horned toads.  Some of the pets found their way into mother’s stewpot for the evening supper.

While the wives struggled to make a home for the family at the settlement, husbands packed the construction site in Black Canyon competing with younger, single men for any kind of low paying, dangerous, and dirty work they could find.  Work on the four immense diversion tunnels, needed to divert the river away from the construction site so the dam could be built, was especially backbreaking toil. 

Men handling immensely heavy rock-cutting and hauling machinery in the tunnels routinely worked in a humid atmosphere with temperatures hovering at 135 degrees, no air movement whatsoever, in choking dust and under the constant threat of falling debris.  The gasoline fumes from the internal combustion engines caused frequent carbon monoxide poisoning for men earning a four-dollar-a-day wage but no one complained – it was work.

And their spirit was strong.  To pass the time, men invented strange and exotic names and continuously kidded and chided each other over their relative position within the laborer hierarchy.  Truck drivers were called “double-uglies,” while those who worked electricity were called “juicers.” 

The most menial workers, those who scraped up and removed the mud and debris from the tunnel floors were called “muckers,” and bosses were known as “easy-doughs.”  Men guiding the cableways were referred to as “signal-punks,” running the small electric locomotives were “dinky-skinners,” and carpenters were called “wood-butchers.” 

But the most glamorous and highest paying job belonged to the men who were suspended 700 feet above the canyon floor, who swung on ropes and bosun’s chairs from side to side, prying away loose rock and boulders from the steep gorge’s cliffs – these men were called “high-scalers.”

By the late spring of 1932 Boulder City was finally completed and without much urging, everyone left Ragtown to live in a real city, one with green parks, wide streets, barracks for single men, and bungalows for families; with clean, running water and electricity – it must have seemed like paradise to the Ragtowners.  Now construction started in earnest and thousands were employed seeing to the dam’s rapid completion. 

Newcomers thought they had died and gone to heaven – full time mess halls churned out everyday breakfasts of fresh grapefruit, oatmeal, mounds of bacon and eggs, stacks of wheat cakes, gallons of coffee, and fresh milk and butter from the construction company’s own dairy.  Men were burning eight to ten-thousand calories a day from the hard physical labor and so consumed vast amounts of food.  Never had they eaten so well. 

For lunch it was roast beef or pork sandwiches, jellyrolls, pies, and fruit.  And supper was like dining on divine “manna from heaven” – roast sirloin of beef, heaps of mashed potatoes and gravy, fresh salad, spinach greens, mince pie, rice pudding, and milk and coffee – all you could eat.  By the time dam construction had finished, almost eight million meals were served to the men who built Boulder Dam.

As Lake Mead rose behind the dam nearing completion, much of Ragtown vanished under 500 feet of dark, cold water as did the cemetery where many of the men died building the dam were buried; and other men, women, and children who died from accidents, heat prostration, or disease.  A few of the ninety-six men who died from construction-related accidents are entombed to this day inside the gigantic concrete structure and their spirits still flitter hither and thither – those remarkably brave “high-scalers,” “muckers,” and “double-uglies.”   

All in all, 16,000 men worked to complete the Boulder Dam two years ahead of schedule and it was officially dedicated by President Franklin D. Roosevelt on September 30, 1935 – a concrete monument to their blood, sweat, and tears.  In 1947 the 80th U.S. Congress passed legislation in Washington officially renaming the dam Hoover Dam in honor of a once orphaned boy, the then 71-year-old ex-President Herbert Hoover.  He died 17 years later. 

Its construction had started with the country stuck in an economic misery unparalleled in American history, yet the Hoover Dam stands today as an inspiring symbol of ingenuity, perseverance, and the spirit of achievement against prevailing hard times and the forces of nature. 

Throughout human history mankind has built monuments to its ingenuity and skill.  In Egypt it was the Great Pyramids, the Romans built the Coliseum, the Greeks the Acropolis, and Europe has its great cathedrals – all awe inspiring structures.  The Americas have their cliff dwellings of Mesa Verde and the mysterious high mountain city of Machu Picchu, which speak to the skill of their ancient builders. 

From the late nineteenth to the twentieth-century, it was the steel and concrete buildings that reached almost a quarter-mile into the sky, the great bridges like the Brooklyn and Golden Gate, miles of mountain tunnels dug out of solid rock, the Interstate Highway System, the Panama Canal, the Transcontinental Railroad, the Trans-Alaska Pipeline, and the fantastic flying machines that extend mankind’s reach far into space. 

Of all the monuments to man’s achievement, one that has to be counted among the great ones is the Hoover Dam.  And long after the story of its making has been forgotten and its builders pass into myth, the dam will endure as a reminder that when times were darkest, Americans turned their face towards the Sun so they couldn’t see their shadow.

It was at the end of the tour that I saw my dad looking at an old photograph on the wall showing African-Americans who had once worked construction on the dam.  There weren’t many.  In 1930, fully 50-percent of able-bodied black men were unemployed. 

They got the worst jobs, the “muckers.”  My dad told me he was looking for a photo that might show the face of his granddaddy but couldn’t find one.  He was the son of an ex-slave, but unlike the “muckers” granddaddy got to be a “high-scaler” because he was a proud man, hardworking, fearless and determined, and the color of his skin had nothing to do with it.  As we walked out of the Visitor Center my dad told me, “Randy, always remember son, we’re a family of high-scalers.”  

                               

(This is a work of fiction.  Although some real-world names, organizations, historical settings, and situations are used to enhance the authenticity of the story, any similarities to actual persons, organizations, or situations are coincidental and all portrayals are purely the product of the author’s imagination.  This is the second edition abridged version 2019.  First edition Copyright © 2006.  All rights reserved)