War is the Health of the State

claudio_grass_globall_gold_mdWar is the Health of the State

 By Claudio Grass

Managing Director, Global Gold AG

In an essay titled “The State”, Randolph Bourne, an American writer, made a distinction between a country and a state that I find crucial. He described one’s country as “an inescapable group into which we are born”. In his view, a country is “a concept of peace, tolerance, of living and letting live. But the State is essentially a concept of power, of competition; it signifies a group in its aggressive aspects. And we have the misfortune of being born not only into a country but into a State, and as we grow up we learn to mingle the two feelings into a hopeless confusion”. Bourne continues to say:

 “It cannot be too firmly realized that war is a function of States and not of nations. Indeed, that it is the chief function of States. War is a very artificial thing. It is not the naïve spontaneous outburst of herd pugnacity; it is no more primary than is formal religion. War cannot exist without a military establishment, and a military establishment cannot exist without a State organization. War has an immemorial tradition and heredity only because the State has a long tradition and heredity. But they are inseparably and functionally joined. We cannot crusade against war without crusading implicitly against the State. And we cannot expect, or take measures to ensure that this war is a war to end war, unless at the same time we take measures to end the State in its traditional form.”


Ludwig von Mises came to a similar conclusion, when he stated:

 “As tax-funded monopolists of ultimate decision making, states can externalize the costs associated with aggressive behavior onto hapless taxpayers. Hence, states are by nature more prone to become aggressors and warmongers than agents or agencies that must themselves bear the costs involved in aggression and war.”


So, is there any truth to what Bourne and Mises believe? Is it applicable to today’s world? The short answer is: Yes. I would like to take the opportunity to explain, why I am convinced that war and the state are inseparable, even today. I would like to draw your attention to some historical facts, since I believe that it is essential to understand history in order to understand the present.


Sutton’s analysis of US military aid to Russia

Professor Anthony C. Sutton, a professor of history, economics and politics, who was born 1925 in London and taught at the Universities of London, Göttingen and California had a huge impact on my beliefs. In 1962, he became a US citizen and worked as a research fellow at Stanford University’s Hoover Institution from 1968 to 1973. In 1973, he published his first book “National Suicide – Military Aid to the Soviet Union”, in which he found that the Soviet Union received approximately 90% of its technology directly from the West, with the particular support of the US government and large US multinational companies.

At the time, Sutton still believed in an open society and thought that these deals originated because of the ignorance, mental laziness and the incapability of an open society to understand the long-term implications of a totalitarian system. However, he never thought that a certain agenda by the US establishment stood behind the “military aid”.

In 1974, Sutton published another book titled “Wall Street and the Bolshevik Revolution”, in which he wrote about the financial support that the Russian October Revolution of 1917 got from Wall Street. He exposes the “relief payments” the Russian revolutionaries received as well as the trade with Russian gold for financing the Bolsheviks. The USA even supported revolutionary propaganda and employed pro-communist writers. In summary: According to Sutton, major players in both the US economy and US government supported the communist revolution in Russia. Sutton believed that there were two reasons for the US support of the Bolsheviks. First, they believed that providing technology to Russia would reduce the technological development of the country and thus would minimize future competition from Russia. Second and more important, according to Sutton, was the fact that foreign companies were given access to the Russian market with quasi monopolies as long as they complied with the wishes of the Bolsheviks.

Sutton wrote several other noteworthy books including “Wall Street and the Rise of Hitler” (1976), were he describes the intricate relationship between Wall Street and the Nazi regime. He believed that without the financing from Wall Street, the German war machine would have not been able to sustain itself.


Government lies and their cost

This leads me to another point: Most people don’t question what their government does, especially when it comes to foreign policy. This gives power-hungry politicians the opportunity to lie to the public, so they willingly accept a war in a foreign country. A recent example is the Iraq war, where the public was led to believe that Saddam was hiding weapons of mass destruction and was an imminent threat to the United States. After the invasion, however, it turned out that Iraq had no WMDs and the threat was exaggerated to gain public support for the war.

Another example. We all know that the CIA and other intelligence services have been involved in questionable activities for ages. My initial motivation for this article was a video with the title “The War Against The Third World” describing America’s foreign interventionism and the expansion of the military-industrial complex. The video shows a speech by John Stockwell, a former Marine and CIA paramilitary intelligence case officer. The video has several different aspects, but I will only mention a few. One of the most shocking excerpts was the section where Stockwell talks about the Church Committee investigation:

“Senator Church said that in the 14 years before he did his investigation he found that they had run 900 major operations and 3000 minor operations. And if you extrapolate that over the whole period of the 40 odd years that we’ve had a CIA, you come up with 3000 major operations and over 10,000 minor operations. Every one of them illegal. Every one of them disruptive of the lives and societies of other peoples and many of them bloody and gory beyond comprehension, almost.”


Another important aspect is how Nixon and Kissinger “secretly” bombed neutral Cambodia for 14 months in 1969, unleashing 110,000 tons of bombs on the country. The irony of this story is that Kissinger actually received the Nobel Peace Prize in 1973 for his “honorable” actions to solve the Vietnam War. This covert action was easier in the past, because the government controlled radio, TV and newspapers. As we will show later, this is becoming increasingly difficult; due to the fact the Internet has become an independent news source for many.


Are the elites implementing a “Divide and Conquer” strategy?

“Divide and Conquer” is one of the oldest strategies used by the ruling powers. The focus of this strategy is to turn people against each other so that they don’t turn against the establishment itself. This division can take on different forms, such as dividing by race, religion, nationality, poor vs. rich or East vs. West.

When I look at the world today and see what is happening, it is obvious that racism is accelerating and tensions between Christians, Jews and Muslims are spiking upward tremendously. Europe is currently being flooded with a wave of refugees from the Middle East and Africa who have nothing to lose. I remember the conversations I had, while living in the Middle East for two years. Back in 2004 in Syria the overwhelming majority of the people I spoke to thought that Europe was a sort of “Promised Land”. They believed that they would live a picturesque life, similar to what they see on TV, if they only made it to Europe. Now their dream has been destroyed within seconds.

The “Promised Land” turned out to be nothing more than a mirage. They are ending up in refugee camps and the majority will not even be allowed to work. With no way of working or supporting their families, I am confident they will become vulnerable to radical ideas they hear in some mosques from extremist Wahabis and Salafists. Therefore I am certain that the situation can and will lead to social tensions.

Additionally, the European welfare state is essentially broke and unsustainable. When we take the economic weakness into consideration it becomes clear that most refugees will not find the “European Dream” they were looking for. Ironically, most of the refugees currently fleeing war or oppressive regimes are fleeing situations, which Western governments have created or at least endorsed in the first place.


Ever expanding state power at home

All this meddling in foreign affairs does not only impact foreign countries, but also affects domestic policies. War is often used by the state to further restrict individual liberties and increase the power of the police apparatus. In the essay we mentioned earlier, Randolph Bourne summed up the impact of war on domestic policy as follows:

“With the shock of war the state comes into its own again. It is the reason given for high taxes, internal revenue bureaucracies, pervasive spying, censorship, military conscription, the abolition of civil liberties, heavy debt, an explosive growth of government spending and borrowing, extensive excise taxation, nationalization of industries, socialist central planning, massive public indoctrination campaigns, the punishment and imprisonment of dissenters to the state’s rule, the shooting of deserters from its armies, the conquest of other countries, inflation of the currency, demonization of private enterprise and the civil society for being insufficiently “patriotic”, the growth of the military/industrial complex, a vast expansion of government pork barrel spending, the demonization of the ideas of freedom and individualism and those who espouse them, and a never-ending celebration, if not deification, of statism and militarism.”


Additionally, today terrorism is increasingly being used to increase the government powers at home. According to John Whitehead from the Rutherford Institute, North Dakota has become the first state to make it legal for the police to fly drones equipped with everything from rubber bullets and pepper spray to tear gas, sound cannons and tasers. He expects 30,000 drones to be airborne in American airspace by 2020. I would like to mention a statement by Prof. Carroll Quigley in his book “Weapons Systems and Political Stability”. He claims that as weapons become more sophisticated and professional, the government employing them becomes more totalitarian.


How can you protect yourself in such an environment?

I am confident that physical Gold and Silver can protect you to a certain extent from government tyranny. Let me start by explaining the reason why I work in the gold business. First, I am confident that with a monetary system based on free banking, the system of today would never exist. This is because most people would not carry out transactions in a fragile and debt based currency. Second, I learned from history that gold is money – everything else is credit!

Gold has been money for over 5000 years. On the other hand, our current monetary system has been in place for only slightly over 40 years. I believe economic prosperity is not possible when the money that we use can be printed out of thin air. Since 2008, global debt has increased from 140 trillion to 200 trillion dollars. Our economy is in shambles and the newly created money goes to the state and its allies bypassing the real economy. I don’t think that we will ever see a real recovery until we return to a system of sound money. We have to choose between freedom or slavery. Only with free markets and the potential of individual minds as a source of inspiration, can we build the basis for a free society.

The root cause of many evils that we have today is our current monetary system. Let’s take war, a topic we discussed in this article, as an example. Without a monetary system that creates currency out of thin air, most of the wars that we have had and still have would simply not be financeable. This system is controlled by a few, who change the rules to their own benefit. And as we have seen they use their privilege to finance wars and to bribe politicians. By holding your wealth in precious metals you are rejecting the current system and also protecting yourself from “financial tyranny”. This includes: capital exchange controls, expropriation, bail-ins, bailouts, negative interest rates, market manipulation on a wide scale and massive paper currency fluctuations. The jurisdiction where you keep your precious metals is also essential in my view. I personally feel safe having my metals stored in Switzerland, a neutral country that doesn’t intervene in international affairs.


The Internet is the light at the end of the tunnel

Although things don’t look very positive at the moment, I’m convinced that sooner or later with the help of the Internet, people will start to understand the principles of freedom and appreciate what it means to be free. Broadcasting and distributing information that is accessible from all over the world and uncontrollable by the establishment is helping to spread better ideas. You probably wouldn’t be reading these lines, if it weren’t for the Internet. The Internet is already making it increasingly difficult for governments to cover up their actions.

However, more importantly the Internet will not only change the way we access information. It will also change the financial system. We are standing at a crossroads and I am convinced that the crypto currency movement will change the currency landscape in the foreseeable future. We will have different digital currencies, some of them may even be based on gold. They will all compete freely on the market. Cash, checks, and other forms of “money” will gradually disappear. I am certain that taking away the government monopoly of money will lead to a safer world, with fewer wars as governments will not be able to print money out of thin air to finance their never ending wars.

Never forget that we always have a choice, even if the establishment is telling us otherwise. I personally choose voluntarism and a free market, what would your choice be?


Claudio Grass is the Managing Director of Global Gold, a company Q Wealth has known and been associated with for many years.

To read more about holding physical gold outside the banking system and the available solutions offered by Global Gold, please visit GlobalGold.ch/physicalgold and request an investor kit for free.



Leave a Comment