Lessons from the Wizard of Oz

From: THE WEB OF DEBT by Ellen Brown

Chapter 1

LESSONS FROM
THE WIZARD OF OZ

"The great Oz as spoken! Pay no attention to that man behind the
curtain! I am the great and powerful Wizard of Oz!"

In refreshing contrast to the impenetrable writings of economists, the
classic fairytale The Wizard of Oz has delighted young and old for
over a century. It was first published by L. Frank Baum as The
Wonderful Wizard of Oz in 1900. In 1939, it was made into a hit
Hollywood movie starring Judy Garland, and later it was made into the
popular stage play The Wiz. Few of the millions who have enjoyed this
charming tale have suspected that its imagery was drawn from that most
obscure and tedious of subjects, banking and finance. Fewer still have
suspected that the real-life folk heroes who inspired its plot may
have had the answer to the financial crisis facing the country today!

The economic allusions in Baum's tale were first observed in 1964 by a
schoolteacher named Henry Littlefield, who called the story "a parable
on Populism," referring to the People's Party movement challenging the
banking monopoly in the late nineteenth century.1 Other analysts later
picked up the theme. Economist Hugh Rockoff, writing in the Journal of
Political Economy in 1990, called the story a "monetary allegory."2
Professor Tim Ziaukas, writing in 1998, stated:
"The Wizard of Oz" . . . was written at a time when American society
was consumed by the debate over the "financial question," that is, the
creation and circulation of money. . . . The characters of "The Wizard
of Oz" represented those deeply involved in the debate: the Scarecrow
as the farmers, the Tin Woodman as the industrial workers, the Lion as
silver advocate William Jennings Bryan and Dorothy as the archetypal
American girl.3

The Germans established the national fairytale tradition with Grimm's
Fairy Tales, a collection of popular folklore gathered by the Brothers
Grimm specifically to reflect German populist traditions and national
values.4 Baum's tale did the same thing for the American populist (or
people's) tradition. The Wizard of Oz has been called "the first truly
American fairytale."5 It was all about people power, manifesting your
dreams, finding what you wanted in your own backyard. According to
Littlefield, the march of Dorothy and her friends to the Emerald City
to petition the Wizard of Oz for help was patterned after the 1894
march from Ohio to Washington of an "Industrial Army" led by Jacob
Coxey, urging Congress to return to the Greenback system initiated by
Abraham Lincoln. The march of Coxey's Army on Washington began a long
tradition of people taking to the streets in peaceful protest when
there seemed no other way to voice their appeals. As Lawrence Goodwin,
author of The Populist Moment, described the nineteenth century
movement to change the money system:
[T]here was once a time in history when people acted. . . . [F]armers
were trapped in debt. They were the most oppressed of Americans, they
experimented with cooperative purchasing and marketing, they tried to
find their own way out of the strangle hold of debt to merchants, but
none of this could work if they couldn't get capital. So they had to
turn to politics, and they had to organize themselves into a party. .
.. . [T]he populists didn't just organize a political party, they made
a movement. They had picnics and parties and newsletters and classes
and courses, and they taught themselves, and they taught each other,
and they became a group of people with a sense of purpose, a group of
people with courage, a group of people with dignity.6

Like the Populists, Dorothy and her troop discovered that they had the
power to solve their own problems and achieve their own dreams. The
Scarecrow in search of a brain, the Tin Man in search of a heart, the
Lion in search of courage actually had what they wanted all along.
When the Wizard's false magic proved powerless, the Wicked Witch was
vanquished by a defenseless young girl and her little dog. When the
Wizard disappeared in his hot air balloon, the unlettered Scarecrow
took over as leader of Oz.

The Wizard of Oz came to embody the American dream and the American
national spirit. In the United States, the land of abundance, all you
had to do was to realize your potential and manifest it. That was one
of the tale's morals, but it also contained a darker one, a message
for which its imagery has become a familiar metaphor: that there are
invisible puppeteers pulling the strings of the puppets we see on the
stage, in a show that is largely illusion.

Money in the Land of Oz

The 1890s were plagued by an economic depression that was nearly as
severe as the Great Depression of the 1930s. The farmers lived like
serfs to the bankers, having mortgaged their farms, their equipment,
and sometimes even the seeds they needed for planting. They were
charged so much by a railroad cartel for shipping their products to
market that they could have more costs and debts than profits. The
farmers were as ignorant as the Scarecrow of banking policies; while
in the cities, unemployed factory workers were as frozen as the Tin
Woodman from the lack of a free-flowing supply of money to "oil" the
wheels of industry. In the early 1890s, unemployment had reached 20
percent. The crime rate soared, families were torn apart, racial
tensions boiled. The nation was in chaos. Radical party politics
thrived.

In every presidential election between 1872 and 1896, there was a
third national party running on a platform of financial reform.
Typically organized under the auspices of labor or farmer
organizations, these were parties of the people rather than the banks.
They included the Populist Party, the Greenback and Greenback Labor
Parties, the Labor Reform Party, the Antimonopolist Party, and the
Union Labor Party. They advocated expanding the national currency to
meet the needs of trade, reform of the banking system, and democratic
control of the financial system.7

Money reform advocates today tend to argue that the solution to the
country's financial woes is to return to the "gold standard," which
required that paper money be backed by a certain weight of gold
bullion. But to the farmers and laborers who were suffering under its
yoke in the 1890s, the gold standard was the problem. They had been
there and done it and knew it didn't work. William Jennings Bryan
called the bankers' private gold-based money a "cross of gold." There
was simply not enough gold available to finance the needs of an
expanding economy. The bankers made loans in notes backed by gold and
required repayment in notes backed by gold; but the bankers controlled
the gold, and its price was subject to manipulation by speculators.
Gold's price had increased over the course of the century, while the
prices laborers got for their wares had dropped. People short of gold
had to borrow from the bankers, who periodically contracted the money
supply by calling in loans and raising interest rates. The result was
"tight" money – insufficient money to go around. Like in a game of
musical chairs, the people who came up short wound up losing their
homes to the banks.

The solution of Jacob Coxey and his Industrial Army of destitute
unemployed men was to augment the money supply with government-issued
United States Notes. Popularly called "Greenbacks," these federal
dollars were first issued by President Lincoln when he was faced with
usurious interest rates in the 1860s. Lincoln had foiled the bankers
by funding the government with U.S. Notes that did not accrue interest
and did not have to be paid back to the banks. The same sort of
debt-free paper money had financed a long period of colonial abundance
in the eighteenth century, until King George forbade the colonies from
issuing their own currency. The money supply had then shrunk,
precipitating a depression that led to the American Revolution.

To remedy the tight-money problem that resulted when the Greenbacks
were halted after Lincoln's assassination, Coxey proposed that
Congress should increase the money supply with a further $500 million
in Greenbacks. This new money would be used to redeem the federal debt
and to stimulate the economy by putting the unemployed to work on
public projects.8 The bankers countered that allowing the government
to issue money would be dangerously inflationary. What they failed to
reveal was that their own paper banknotes were themselves highly
inflationary, since the same gold was "lent" many times over,
effectively counterfeiting it; and when the bankers lent their paper
money to the government, the government wound up heavily in debt for
something it could have created itself. But those facts were buried in
confusing rhetoric, and the bankers' "gold standard" won the day.

The Silver Slippers: The Populist Solution
to the Money Question

The Greenback Party was later absorbed into the Populist Party, which
took up the cause against tight money in the 1890s. Like the
Greenbackers, the Populists argued that money should be issued by the
government rather than by private banks. William Jennings Bryan, the
Populists' loquacious leader, gave such a stirring speech at the
Democratic convention that he won the Democratic nomination for
President in 1896. Outgoing President Grover Cleveland was also a
Democrat, but he was an agent of J. P. Morgan and the Wall Street
banking interests. Cleveland favored money that was issued by the
banks, and he backed the bankers' gold standard. Bryan was opposed to
both. He argued in his winning nomination speech:
We say in our platform that we believe that the right to coin money
and issue money is a function of government. . . . Those who are
opposed to this proposition tell us that the issue of paper money is a
function of the bank and that the government ought to go out of the
banking business. I stand with Jefferson . . . and tell them, as he
did, that the issue of money is a function of the government and that
the banks should go out of the governing business. . . . [W]hen we
have restored the money of the Constitution, all other necessary
reforms will be possible, and . . . until that is done there is no
reform that can be accomplished.

He concluded with these famous lines:
You shall not press down upon the brow of labor this crown of thorns,
you shall not crucify mankind upon a cross of gold.9

Since the Greenbackers' push for government-issued paper money had
failed, Bryan and the "Silverites" proposed solving the liquidity
problem in another way. The money supply could be supplemented with
coins made of silver, a precious metal that was cheaper and more
readily available than gold. Silver was considered to be "the money of
the Constitution" although the Constitution only referred to the
"dollar," because the dollar was understood to be a reference to the
Spanish milled silver dollar coin then in common use. The slogan of
the Silverites was "16 to 1": 16 ounces of silver would be the
monetary equivalent of 1 ounce of gold. Ounces is abbreviated oz,
hence "Oz." The Wizard of the Gold Ounce (Oz) in Washington was
identified by later commentators as Marcus Hanna, the power behind the
Republican Party, who controlled the mechanisms of finance in the
administration of President William McKinley.10 (Hanna was reportedly
admired by Karl Rove, who followed the model as political adviser to
President George Bush Jr.11)

Frank Baum, the journalist who turned the politics of his day into The
Wonderful Wizard of Oz, marched with the Populist Party in support of
Bryan in 1896. He is said to have had a deep distrust of big-city
financiers. But when his dry goods business failed, he bought a
Republican newspaper, which had to have a Republican message to retain
its readership.12 That may have been why the Populist message was so
deeply buried in symbolism in his famous fairytale. Like Lewis
Carroll, who began his career writing uninspiring tracts about
mathematics and politics and wound up satirizing Victorian society in
Alice's Adventures in Wonderland, Baum was able to suggest in a
children's story what he could not say in his editorials. His book
contained many subtle allusions to the political and financial issues
of the day. The story's inspirational message was evidently a product
of the times as well. Commentators trace it to the theosophical
movement, of which Baum was an active member.13 Newly-imported from
India, it held that reality is a construct of the mind. What you want
is already yours; you need only to believe it, to "realize" it or
"make it real."

Looking at the plot of this familiar fairytale, then, through the lens
of the contemporary movements that inspired it . . . .

An Allegory of Money, Politics
and Believing in Yourself

The story began on a barren Kansas farm, where Dorothy lived with a
very sober aunt and uncle who "never laughed" (the 1890s depression
that hit the farmers particularly hard). A cyclone came up, carrying
Dorothy and the house into the magical world of Oz (the American dream
that might have been). The house landed on the Wicked Witch of the
East (the Wall Street bankers and their man Grover Cleveland), who had
kept the Munchkins (the farmers and factory workers) in bondage for
many years.

For killing the Wicked Witch, Dorothy was awarded magic silver
slippers (the Populist silver solution to the money crisis) by the
Good Witch of the North (the North was then a Populist stronghold). In
the 1939 film, the silver slippers would be transformed into ruby
slippers to show off the cinema's new technicolor abilities; but the
monetary imagery Baum suggested was lost. The silver shoes had the
magic power to solve Dorothy's dilemma, just as the Silverites thought
that expanding the money supply with silver coins would solve the
problems facing the farmers.

Dorothy wanted to get back to Kansas but was unaware of the power of
the slippers on her feet, so she set out to the Emerald City to seek
help from the Wizard of Oz (the apparently all-powerful President,
whose strings were actually pulled by financiers concealed behind a
curtain).

"The road to the City of Emeralds is paved with yellow brick," she was
told, "so you cannot miss it." Baum's contemporary audience, wrote
Professor Ziaukas, could not miss it either, as an allusion to the
gold standard that was then a hot topic of debate.14 Like the Emerald
City and the Great and Powerful Oz himself, the yellow brick road
would turn out to be an illusion. In the end, what would carry Dorothy
home were silver slippers.

On her journey down the yellow brick road, Dorothy was first joined by
the Scarecrow in search of a brain (the naive but intelligent farmer
kept in the dark about the government's financial policies), then by
the Tin Woodman in search of a heart (the factory worker frozen by
unemployment and dehumanized by mechanization). Littlefield commented:
The Tin Woodman . . . had been put under a spell by the Witch of the
East. Once an independent and hard working human being, the Woodman
found that each time he swung his axe it chopped off a different part
of his body. Knowing no other trade he "worked harder than ever," for
luckily in Oz tinsmiths can repair such things. Soon the Woodman was
all tin. In this way Eastern witchcraft dehumanized a simple laborer
so that the faster and better he worked the more quickly he became a
kind of machine. Here is a Populist view of evil Eastern influences on
honest labor which could hardly be more pointed.

The Eastern witchcraft that had caused the Woodman to chop off parts
of his own body reflected the dark magic of the Wall Street bankers,
whose "gold standard" allowed less money into the system than was
collectively owed to the banks, causing the assets of the laboring
classes to be systematically devoured by debt.

The fourth petitioner to join the march on Oz was the Lion in search
of courage. According to Littlefield, he represented the orator Bryan
himself, whose roar was mighty like the king of the forest but who
lacked political power. Bryan was branded a coward by his opponents
because he was a pacifist and anti-imperialist at a time of American
expansion in Asia. The Lion became entranced and fell asleep in the
Witch's poppy field, suggesting Bryan's tendency to get side-tracked
with issues of American imperialism stemming from the Opium Wars.
Since Bryan led the "Populist" or "People's" Party, the Lion also
represented the people, collectively powerful but entranced and
unaware of their strength.

In the Emerald City, the people were required to wear green-colored
glasses attached by a gold buckle, suggesting green paper money
shackled to the gold standard. To get to her room in the Emerald
Palace, Dorothy had to go through 7 passages and up 3 flights of
stairs, an allusion to the "Crime of '73," the congressional Act that
changed the money system from bimetallism (paper notes backed by both
gold and silver) to an exclusive gold standard. The Crime of '73
proved to all Populists that Congress and the bankers were in
collusion.15

Dorothy and her troop presented their requests to the Wizard, who
demanded that they first vanquish the Wicked Witch of the West,
representing the McKinley/Rockefeller faction in Ohio (then considered
a Western state). The financial powers of the day were the Morgan/Wall
Street/Cleveland faction in the East (the Wicked Witch of the East)
and this Rockefeller-backed contingent from Ohio, the state of
McKinley, Hanna, and Rockefeller's Standard Oil cartel. Hanna was an
industrialist who was a high school friend of John D. Rockefeller and
had the financial backing of the oil giant.16

Dorothy and her friends learned that the Witch of the West had
enslaved the Yellow Winkies and the Winged Monkeys (an allusion to the
Chinese immigrants working on the Union-Pacific railroad, the native
Americans banished from the northern woods, and the Filipinos denied
independence by McKinley). Dorothy destroyed the Witch by melting her
with a bucket of water, suggesting the rain that would reverse the
drought, and the financial liquidity that the Populist solution would
bring to the land. As one nineteenth century commentator put it,
"Money and debt are as opposite in nature as fire and water; money
extinguishes debt as water extinguishes fire."17

When Dorothy and her troop got lost in the forest, she was told to
call the Winged Monkeys by using a Golden Cap she had found in the
Witch's cupboard. When the Winged Monkeys came, their leader explained
that they were once a free and happy people; but they were now "three
times the slaves of the owner of the Golden Cap, whosoever he may be"
(the bankers and their gold standard). When the Golden Cap fell into
the hands of the Wicked Witch of the West, the Witch had made them
enslave the Winkies and drive Oz himself from the Land of the West.

Dorothy used the power of the Cap to have her band of pilgrims flown
to the Emerald City, where they discovered that the "Wizard" was only
a smoke and mirrors illusion operated by a little man behind a
curtain. A dispossessed Nebraska man himself, he admitted to being a
"humbug" without real power. "One of my greatest fears was the
Witches," he said, "for while I had no magical powers at all I soon
found out that the Witches were really able to do wonderful things."

If the Wizard and his puppet were Marcus Hanna and William McKinley,
who were the Witches they feared? Behind the Wall Street bankers were
powerful British financiers, who funded the Confederates in the Civil
War and had been trying to divide and conquer America economically for
over a century. Patriotic Americans had regarded the British as the
enemy ever since the American Revolution. McKinley was a protectionist
who favored high tariffs to keep these marauding British free-traders
out. When he was assassinated in 1901, no conspiracy was proved; but
some suspicious commentators saw the invisible hand of British high
finance at work.18

The Wizard lacked magical powers but was a very good psychologist, who
showed the petitioners that they had the power to solve their own
problems and manifest their own dreams. The Scarecrow just needed a
paper diploma to realize he had a brain. For the Tin Woodman, it was a
silk heart; for the Lion, an elixir for courage. The Wizard offered to
take Dorothy back to Kansas in his hot air balloon, but the balloon
took off before she could get on board. Dorothy and her friends then
set out to find Glinda the Good Witch of the South, who they were told
could help Dorothy find her way home.

On the way they faced various challenges, including a great spider
that ate everything in its path and kept everyone unsafe as long as it
was alive. The Lion (the Populist leader Bryan) welcomed this chance
to test his new-found courage and prove he was indeed the King of
Beasts. He decapitated the mighty spider with his paw, just as Bryan
would have toppled the banking cartel if he had won the Presidency.

The group finally reached Glinda, who revealed that Dorothy too had
the magic tokens she needed all along: the Silver Shoes on her feet
would take her home. But first, said Glinda, Dorothy must give up the
Golden Cap (the bankers' restrictive gold standard that had enslaved
the people).

The moral also worked for the nation itself. The economy was deep in
depression, but the country's farmlands were still fertile and its
factories were ready to roll. Its entranced people merely lacked the
paper tokens called "money" that would facilitate production and
trade. The people had been deluded into a belief in scarcity by
defining their wealth in terms of a scarce commodity, gold. The
country's true wealth consisted of its goods and services, its
resources and the creativity of its people. Like the Tin Woodman in
need of oil, all it needed was a monetary medium that would allow this
wealth to flow freely, circulating from the government to the people
and back again, without being perpetually drained into the private
coffers of the bankers.

Sequel to Oz

The Populists did not achieve their goals, but they did prove that a
third party could influence national politics and generate
legislation. Although Bryan the Lion failed to stop the bankers,
Dorothy's prototype Jacob Coxey was still on the march. In a plot
twist that would be considered contrived if it were fiction, he
reappeared on the scene in the 1930s to run against Franklin D.
Roosevelt for President, at a time when the "money question" had again
become a burning issue. In one five-year period, over 2,000 schemes
for monetary reform were advanced. Needless to say, Coxey lost the
election; but he claimed that his Greenback proposal was the model for
the "New Deal," Roosevelt's plan for putting the unemployed to work on
government projects to pull the country out of the Depression. The
difference was that Coxey's plan would have been funded with debt-free
currency issued by the government, on Lincoln's Greenback model.
Roosevelt funded the New Deal with borrowed money, indebting the
country to a banking cartel that was surreptitiously creating the
money out of thin air, just as the government itself would have been
doing under Coxey's plan without accruing a crippling debt to the
banks.

After World War II, the money question faded into obscurity. Today,
writes British economist Michael Rowbotham, "The surest way to ruin a
promising career in economics, whether professional or academic, is to
venture into the 'cranks and crackpots' world of suggestions for
reform of the financial system."19 Yet the claims of these cranks and
crackpots have consistently proven to be correct. The U.S. debt burden
has mushroomed out of control, until just the interest on the federal
debt now threatens to be a greater tax burden than the taxpayers can
afford. The gold standard precipitated the problem, but unbuckling the
dollar from gold did not solve it. Rather, it caused worse financial
ills. Expanding the money supply with increasing amounts of "easy"
bank credit just put increasing amounts of money in the bankers'
pockets, while consumers sank further into debt. The problem proved to
be something more fundamental: it was in who extended the nation's
credit. As long as the money supply was created as a debt owed back to
private banks with interest, the nation's wealth would continue to be
drained off into private vaults, leaving scarcity in its wake.
Today's monetary allegory goes something like this: the dollar is a
national resource that belongs to the people. It was an original
invention of the early American colonists, a new form of paper
currency backed by the "full faith and credit" of the people. But a
private banking cartel has taken over its issuance, turning debt into
money and demanding that it be paid back with interest. Taxes and a
crushing federal debt have been imposed by a financial ruling class
that keeps the people entranced and enslaved. In the happy storybook
ending to the tale, the power to create money is returned to the
people, and abundance returns to the land. But before we get there,
the Yellow Brick Road takes us through the twists and turns of history
and the writings and insights of a wealth of key players. We're off to
see the Wizard .
--
I am working on creating wildlife habitat that is off-limits to
humans ("pure habitat"). Want to help? (I spent the previous 8
years fighting auto dependence and road construction.)

Please don't put a cell phone next to any part of your body that you are fond of!

http://home.pacbell.net/mjvande

Yawn. ZZZZZZZ.

On Sep 24, 12:29*am, Mike Vandeman wrote:

Mike can relate to The Wizard Of Oz.


He chops down trees, like the Tinman.

He has no brain, like the Scarecrow.

He rides a mountain bike, like Miss Gulch.

He's a coward, like the Cowardly Lion.

He's a phony, like the Wizard.

He has more frequent flyer miles than all the flying monkeys combined.

"Siskuwihane" wrote in message
...
On Sep 24, 12:29 am, Mike Vandeman wrote:

Mike can relate to The Wizard Of Oz.


He chops down trees, like the Tinman.

He has no brain, like the Scarecrow.

He rides a mountain bike, like Miss Gulch.

He's a coward, like the Cowardly Lion.

He's a phony, like the Wizard.

He has more frequent flyer miles than all the flying monkeys combined.

---------
Priceless! DUH!

Siskuwihane wrote:
On Sep 24, 12:29 am, Mike Vandeman wrote:

Mike can relate to The Wizard Of Oz.


He chops down trees, like the Tinman.

He has no brain, like the Scarecrow.

He rides a mountain bike, like Miss Gulch.

He's a coward, like the Cowardly Lion.

He's a phony, like the Wizard.

He has more frequent flyer miles than all the flying monkeys combined.

Check and mate! Nicely done!