Sunday, March 29, 2015

Government by Contract

© by Linda Minor

An Unbridled Administrator

If Jesse Jones served as the “bridge” between the purposes of the Democratic Party in the 1930s and the source of funds to accomplish those purposes, those allegedly egalitarian purposes quickly disintegrated into a factional grab for government succor—much as a newly born puppies fight amongst themselves in competition for access to their mother’s teats.

The New Deal was merely an updated continuation of the unfinished agenda begun by the previous Democratic President, Woodrow Wilson—interrupted by Republicans Coolidge, Harding and Hoover. An outline of that platform had conveniently been set forth for us in a pathetically-written novel, originally published anonymously shortly before the 1912 election, whose author was revealed in the spring of 1916 to be none other than the mysterious little man from Texas known as Colonel House.

In Philip Dru, Administrator House laid out his plans for an efficiently run new world order—a model for rule by a beneficent executive officer in whose hands power would be centralized. The legislative agenda necessary to accomplish that ideal government was systematically put in place during the Woodrow Wilson administration (1913-1921) through enactment of:
  • The Federal Reserve Banking System (Owen-Glass Act, signed December 23, 1913) and
  • The progressive federal income tax (Sixteenth Amendment, U.S. Constitution, ratified February 3, 1913).
The motive behind the Wilson agenda, to control the masses without upsetting the applecart, was reflected on the title page of House’s novel:
"No war of classes, no hostility to existing wealth, no wanton or unjust violation of the rights of property, but a constant disposition to ameliorate the condition of the classes least favored by fortune." —Giuseppe Mazzini[1]
In this paper, we will observe the results of that effort to make the executive branch of government, delineated by the U.S. Constitution to be only one of three co-equal branches of government, into what it is today—a centralized clearinghouse capable of obtaining natural resources and redistributing them by means of an oligarchical administrative system in which a bureaucracy contracts with corporations set up by factions within the financial elite. In another essay, “Rewriting History,” we describe that clearinghouse function using a spider plant metaphor to illustrate how an elected executive government has over time spun off various unelected and unaccountable offshoots, through which it distributes its gathered resources. Ongoing historical research continues to support that metaphor.

The Model

House was assisted in his effort by other behind-the-scenes advisers (in a curtain-behind-the-curtain sleight-of-hand maneuver), the most important of which was the German Jewish banker Paul Warburg. In 1907 Warburg met Senator Nelson Aldrich, who
The Warburgs
visited [Jacob Schiff’s office at] Kuhn, Loeb to ask how the Reichsbank issued treasury bills. Schiff didn’t know and summoned Paul. By the time Aldrich left, an enthusiastic Paul mused,
‘There marches national bank currency and there goes currency reform.' [2]
The distribution clearinghouse Warburg designed, which was modified by Congress before final passage, is comprised of an elite class of bankers who are shareholders of the private centralized banking system granted power in 1913—a class whose ultimate goal is to break free of any legislative or judicial constraints and to govern the country much as Philip Dru was allowed to do in Col. House’s warped imagination.  The bankers operate within twelve separate regions of the country, each of which is governed by a separate governing board. 

Col. House’s challenge after the Act was passed (but before the system was actually operating to its full extent) was beginning to put in place the administrative infrastructure he had laid out in his book. As individuals in power tend to do, he sought expertise for his experiment only from his inner circle of acquaintances.

Click to enlarge; note where Jesse's arms led.
Jesse Jones states in his autobiography that, though he had refused House’s repeated summonses to Washington throughout the Wilson Administration, he finally gave in to the entreaties because his country needed him to help alleviate the symptoms of the depression; Jones thus viewed himself as the ideal administrator. Once Roosevelt replaced him, Jones’ support for the New Deal waned. Nevertheless, once the legislation had been enacted and forced down the throat of the Supreme Court, the enhanced administrative power given the executive branch remained. 

Acting as the financial hub of the New Deal government of Franklin D. Roosevelt, Jones distributed “Fifty Billion Dollars,” according to the title of his autobiography, though it has never been clear how that money was created. While Jones was head of the Reconstruction Finance Corporation (RFC), he had the power to dole out or to deny contracts to individuals and corporations in order to keep the masses employed, so as not to be engaged in revolutionary activity against the existing power structure. Upon his return to Houston in 1946, he would not only continue his commercial real estate develop business, but would work through his Houston Endowment Foundation to set up a secret method to finance intelligence operations, as well as to fund political campaigns.[3]

Secret Visionaries

One platform plank remained unfulfilled by the end of Wilson’s term of office. Although it would take another world war to gain approval for that goal—which, incidentally, helped to further the international banking ideal desired by the Bank for International Settlements in Switzerland—Wilson was still hopeful he could achieve that goal before his term of office ended in 1921. In order to draft a constitution for the League of Nations, Wilson appointed a four-main committee chaired by Col. House and named another man, like Warburg from a German Jewish background, as adviser to the committee. George Louis Beer, whose father Julius Beer lived next door to Swiss-born Meyer Guggenheim and his son William on West 77th Street in New York,[4]  used his knowledge of British imperial and colonial policy to develop a constitution for world government along similar lines.[5] He was chief of the colonial division of the American delegation at the Paris Peace Conference and in charge of helping to draft the mandates for the administration of the former German colonies.

The Guggenheims

The Guggenheim family—just as a plant absorbs its required nutrients from the soil—had been instrumental in acquiring for the United States scarce minerals necessary for the nation’s strategic purposes—coinage, weapons manufacturing, etc. Because of the scarcity and the expense in obtaining those minerals, the Guggenheims therefore occupied a powerful position in America at the turn of the century. Having been a member of the Jewish clique which included the Guggenheims as well as an assortment of Jewish bankers in Kuhn, Loeb and other Wall Street firms, George Louis Beer understood the importance of such strategic metals in banking and world trade.[6] His family maintained connections among the Jewish banking community which moved from one nation to the next, setting up centralized banking systems which could act within a global clearinghouse in an attempt to stabilize each nation to maintain control over its currency.[7]

The Texas Network

Like Col. House, Jesse Jones greased a political machine composed of Texans with whom he had been associated in business and banking. It is the network to which they gave power which maintains power today. It is that network that explains who Halliburton is. Without understanding the past, we can never hope to understand the current power structure—how it thinks and how it works.

We can identify the network by its components—the businesses in which its constituents were engaged. The purpose of the “administrator” is to distribute the government’s money to those businesses, assuring the network that it will not need to compete with the same type of businesses not controlled by the network. Since money usually determines the outcomes of elections, the network sets up its own method of bypassing the law in order to funnel money to its candidates.

Vice President Dick Cheney’s primary function under George W. Bush was to distribute contracts to his old employer, Halliburton, as well as to lay the groundwork for the pretext necessary to get the United States involved in a war. Can it really be that simple? The best way to answer that question is to examine and analyze the governing boards of Halliburton throughout its history—a time-consuming process.  In an essay called “The Halliburton Riddle,” we stated:
“Connally, Rumsfeld, Cheney and Armstrong—of those four, three would serve as directors of Halliburton. The fourth, Rumsfeld, as Secretary of Defense would help George W. Bush engineer the war in Iraq, to Halliburton’s benefit.” 
Thus it was intimated that there is a definite connection between that corporate clique and the policy decisions being made in George W. Bush's White House, and that, to a great degree, those policy decisions are concerned primarily with trade deficits and currency stabilization—issues with which the United States has been dealing throughout its history.

The State of Texas houses one of the twelve district banks that operate the Federal Reserve.  Located in Dallas, it controls all banks in Texas, southern New Mexico and northern Louisiana.  Texans have always resented their subservience to Eastern capital, always searching for a way to avoid having to go to New York or Boston to sell their bonds or issue new corporate stock. When Jesse Jones headed the RFC, he made sure that his friends back home were not neglected, and those friends liked having one of their own as the nation’s chief banker.

Although Jones had, in 1917 been one of the initial incorporators of Houston-based Humble Oil Company (a majority of whose stock was secretly, and illegally, owned by Standard Oil of New Jersey), he sold his stock when began work for the Red Cross at the end of World War I. His co-founders, however, because of Texas’ importance as a resource for petroleum and natural gas, would eventually see themselves in the chairmanship of Standard Oil of New Jersey.

They would also gain access to the board of Houston’s prestigious Rice University, patterned along the lines of Princeton, where Jersey Standard was originally headquartered. The Humble founders would also control a major segment of the beef producing industry—with its King Ranch in South Texas performing a dual function as cattle raiser and oil producer (having leased its land to Humble Oil, which found huge oil fields there).

It was, in fact, a scion of the King Ranch—Congressman Richard Mifflin Kleberg—who gave Jesse Jones’ replacement as head of the Texas network his first job in Washington, D.C. in 1932. While young Lyndon Baines Johnson was still learning the ropes as Congressman Kleberg’s aide, Col. House was in New York meeting periodically with FDR. But between 1938 (when Col. House died) and about 1941, control of the Texas network wavered between Jesse Jones and Vice-President John Nance Garner.

Once Garner was replaced as Vice-President by Henry Wallace, both Garner and Jones returned to Texas and began to operate a top-secret network of Texans to counter what they saw as the evil influences of Franklin Roosevelt, who now had no loyalty to the vision of Col. House. Jones’ power within the RFC and the Commerce Department disappeared almost overnight. Garner retired to Uvalde, where he lived until 1967, perhaps mentoring a whole new generation of Democrats with a more conservative focus than FDR. The Texas network came increasingly under the influence of Lyndon Johnson, and it was at that point that George and Herman Brown, founders of Brown & Root as a construction company, began to use Johnson’s inside information and connection to FDR to keep the federal dollars flowing into Texas. After FDR's death in 1945, Johnson made a decision to stay within the Democratic establishment, while other Texas Democrats openly rebelled against the New Deal. FDR's last vice-president came from Missouri, and therefore, when Harry Truman rose to the Presidency, so too did Missouri's influence within the banking establishment rise to some extent—including the influence of St. Louis investment banker G.H. "Bertie" Walker and his son, "Herbie," a grandfather and uncle, respectively, of George H. W. Bush. We will return to this family in the future.

Lyndon Johnson, nevertheless, had a secret tap into the role that had been assigned to Robert Bernerd Anderson, a Texas Republican appointed by Truman to a task even more mysterious than the work engaged in by Col. House. An essay about Anderson, "Tilting at Oil Wells," was posted at other of the blogs written by this author—Where the Gold Is. Anderson possibly did more than any other individual to ensure Texas’ access to mineral resources independent of the Federal Reserve’s New York and Boston districts. He acted as a transition between the old Texas network (which obtained political power through the Democratic Party) and the new Bush network, which led Texas into the Republican Party. Because of what Anderson knew, the Texas network in 1968 turned Republican. Despite what they owed to LBJ (what he helped them do in November 1963), former Governor John Connally organized Democrats for Nixon, and Lyndon knew his time for power was over.

The political machine for which LBJ worked (he only thought he controlled it; whereas, it was the other way round) continues to reside in Texas today, although it is now headed by Republicans rather than Democrats. Thus, it is no mere coincidence that three of the last eight Presidents allegedly “elected” by the people of the United States have claimed Texas as their residence. The disproportionate influence asserted by Texans stems no more from a coincidence than does the fact that the election of 2004 pitted two members of the Yale secret society Skull and Bones against each other. Identification of the financial/political network (some have used the term “cabal”) which rose to power in 1963—and which is so reluctant to relinquish that power—is of urgent importance in order to change the paradigm that has taken America ever closer into the grips of globalism.

Just as Brown & Root understood that maintaining political power is a necessary step in order to assure its continued access to government contracts, the contracts themselves helped to determine what policies those politicians, whose power was contingent on continuing to feed contracts to the network which elected them, would pursue. It is a vicious cycle that, in the hands of Texans, always becomes deadly and dangerous.


  1. Philip Dru Administrator: A Story of Tomorrow, 1920-1935, originally published anonymously in 1912 by B.W. Huebsch.  The badly written novel was in 1916 disclosed to have been authored by Col. Edward M. House, the man behind Woodrow Wilson’s rise to prominence.   Indicating that his true purpose in creating such an administrative framework within the federal executive branch of government was to keep the peasants happy so as not to upset the existing order, House began his book with a quote from the Italian nationalist, Giuseppe Mazzini, whom present-day conspiracy theorists have called an Illuminati leader.

  2. Ron Chernow, The Warburgs: The Twentieth-Century Odyssey of a Remarkable Jewish Family (New York:  Random House, 1993), 132.  Chernow reveals that Paul Warburg, along with Aldrich, “sneaked off” to Jekyll Island, Georgia late in 1910 to discuss currency reform with other wealthy men from American banking circles.  This meeting was discussed in my essay “Membership by Inheritance Only.”

  3. William R. Corson, The Armies of Ignorance: The Rise of the American Intelligence Empire (New York: Dial Press/James Wade Books, 1977). According to Corson, Jones had been chosen by Colonel House to serve under Major General Ralph H. Van Deman—General Pershing's senior intelligence officer and Chief of Allied Counterintelligence—at the Paris Peace Commission after World War I. Van Deman’s 38-year career in intelligence had taken place long before the Office of Strategic Services, the Central Intelligence Agency, or National Security Agency had been created, before any funding mechanism for intelligence operations existed. Corson had lived, worked, and traveled in Japan, China, Indonesia, Thailand, Burma, Laos, and Cambodia throughout the cold war years and had fought in World War II, Korea, and Vietnam—retiring as a retired lieutenant colonel from the Marine Corps. He had “learned the intricate workings of the intelligence community in a wide variety of field and staff intelligence assignments,” including “Staff Secretary of the President's Special Group (CI) joint DOD-CIA Committee on Counterinsurgency R & D, Special Assistant to the Secretary of Defense's Director of the Advanced Research Projects Agency, and Officer in Charge of the Assistant Secretary of Defense (Systems Analysis) Southeast Asia intelligence evaluation program.” Yet, with all that experience, after talking with Van Deman, Corson admitted to being left 

with a conundrum which after 27 years remains unresolved. It involved my stated disbelief that the activities surrounding his card file project could have been carried out without the financial assistance of others. His reply was equally disarming and bemusing. In essence he said, "I have never personally accepted a penny to carry out this work; however, others have had need for funds to do what is necessary" and he asked, "Do you have any quarrel with the idea that private citizens should not make funds available to those able and willing to carry out the work required to keep us free?"  We left it there with his gentle admonition, "Your father understood this and there is no reason you should not." My thoughts jumped to my father's relationship with Jesse Jones and the Houston Endowment, but Van Deman, in a sphinxlike pronouncement said, "Your future lies with those in the active forces, but never fear, there are those in reserve who will help in their own silent ways." (See footnote at pages 104-105.)
  4. The Guggenheims were discussed in Linda Minor, “Who “Created” Condi Rice?” in 2004. As stated in that essay, the Guggenheims had amassed a fortune in lead, copper and silver smelting in Colorado, which “in 1887, led to the formation of the American Smelting & Refining Company (ASARCO) and the Guggenheim Exploration Company in 1899 and created the American Smelting and Refining Co. (ASARCO).”

  5. In addition to becoming wealthy from importing tobacco, Beer’s studies had been pursued first at Columbia in New York and later in London, where he learned how the British socialists had financed their own welfare scheme, first with Indian opium, and later with gold and diamonds from South Africa.

  6. The Federal Reserve Act’s “chief architect was Paul Warburg of the German and Swiss  banking house who moved to America only nine years earlier. He brought with him all the experience of European central banking. His brother Max Warburg was financial adviser to the Kaiser and later Director of Germany's central bank, The Reichsbank. Paul Warburg’s Wall Street banking operation was a partnership with the Rothschilds in Kuhn Loeb & Co.”  G. Edward Griffin, The Creature from Jekyll Island (American Media, Fourth Edition, 2002).

  7. Julius Beer’s name appeared often in The New York Times in conjunction with names such as Schiff, Guggenheim, Rothschild, Warburg, Lewisohn, Lehman and Loeb—within the context of “Jewish society” and charitable causes of that day.

  7. The first of the three, Lyndon B. Johnson, entered the White House as a result of John F. Kennedy’s assassination on November 22, 1963 and was elected in 1964. The second was George H.W. Bush, virtual president for much of Reagan’s eight years in the Office, elected in 1988. The third was George W. Bush, who held the job from 2001 through 2008.  We don’t count Gerald Ford as being “elected”; he was appointed to the vice presidency after Spiro Agnew resigned and ascended to the Presidency following Richard Nixon’s disgrace. We also use the term “elected” loosely because of disputes surrounding the elections of 2000 and 2004.