According to his own statements and the facts, Paul M. Warburg set out to reform the monetary system of the United States, and did so. He had the success which comes to few men, of coming an alien to the United States, connecting himself with the principal Jewish financial firm here, and immediately floating certain banking ideas which have been pushed and manipulated and variously adapted until they have eventuated in what is known as the Federal Reserve System.
When Professor Seligman wrote in the Proceedings of the Academy of Political Science that “the Federal Reserve Act will be associated in history with the name of Paul M. Warburg,” a Jewish banker from Germany, he wrote the truth. But whether that association will be such as to bring the measure of renown which Professor Seligman implies, the future will reveal.
What the people of the United States do not understand and never have understood is that while the Federal Reserve Act was governmental, the whole Federal Reserve System is private. It is an officially created private banking system.
Examine the first thousand persons you meet on the street, and 999 will tell you that the Federal Reserve System is a device whereby the United States Government went into the banking business for the benefit of the people. They have an idea that, like the Post Office and the Custom House, a Federal Reserve Bank is a part of the Government’s official machinery.
It is natural to feel that this mistaken view has been encouraged by most of the men who are competent to write for the public on this question.