Imperium Libertatis

Disclosure: I realize this TL may not be received well by many on here. I will admit beforehand that I am a libertarian, or more accurately a Classic Liberal. As such, my political beliefs do influence this TL to a great extent. However, please realize that most TL's regarding the US on this board, and particularly the "Ameriwank" genre TL's tend to always have the US become more "progressive" and by that I mean the existence of "Progressive Era" legislation and reform in the TL. Though I respect those authors who choose to take this route, I wanted to create an alternative; an "Ameriwank" that sticks to the Classic Liberal principles that founded the US.

Having said that, I am not writing this TL to start a political flame war or convince anyone to change their political views; this project is simply for fun. I realize many of you will be opposed to some of the things mentioned in the TL or the overall libertarian feel to it; that's fine and I respect that. Please don't turn this thread into political debate as you will not convince me of Progressivism/modern liberalism and I will not convince you of my belief in true free markets and classic liberalism. Considering that almost every TL on here dealing with America has a Progressive feel to it and our very own history represents the Statist view of the world, see this as simply a thought experiment and alternative. Finally the basic premise of this TL may seem to completely contradict my political views; it will not by the end, I can assure you. Now, let the fun begin!

Imperium Libertatis: The Reign of Classic Liberalism
A Different Kind of "Ameriwank"

1782 – Martha Jefferson, wife of Thomas Jefferson, does not die several months after giving birth as in OTL. This leads to Jefferson not being appointed minister to France in 1786.

1785 – Thomas Jefferson and James Madison jointly author the Jefferson-Madison Manifesto calling for a Constitutional Convention to fix or replace the ineffective Articles of Confederation. The Manifesto calls for the States to send delegates to Philadelphia for the purpose of strengthening the federation between the States by voluntarily joining into a contract whereby some sovereignty is delegated (not given up completely) to a federal government created and ran by the States themselves. The Manifesto includes many principles enshrined in The Wealth of Nations by Adam Smith and Two Treatises of Government by John Locke and ties these together with the need for a voluntary association of free and sovereign States working together for mutual defense and benefit. Invitations are sent to many of the States’ leading politicians and important figures to convene a Convention. Patrick Henry, though suspicious of the aims of such a Convention, decides to attend the Convention due to Jefferson’s impassioned plea in a letter he wrote personally to Henry asking for his attendance.

1787 – The Constitutional Convention opens on May 2nd, but due to travel difficulties, many of the delegates arrive late and it isn’t until May 17th that a quorum of at least seven States was met to allow debate to go forward. Alexander Hamilton, the biggest supporter of a powerful federal government, based on the British model, does not attend the Convention due to illness. Several plans were considered and rejected, with most of the controversy is centered on the nature of the Senate, the Presidency, slavery, and the relationship of the States to the new federal government. The Virginia Plan was initially used to begin the proceedings, but eventually it was rejected as being too unlikely to restrain the power of the federal government by the “States Rights” lobby. Many delegates wanted specific language in the Constitution that would protect State sovereignty, as well as that of the People. In response, Patrick Henry and Thomas Jefferson proposed the Henry-Jefferson Plan that took pieces of each of the plans proposed up to that point and inserted specific language protecting the sovereignty of the States, the voluntary nature of the Union, the right of secession, and the right of nullification. The Plan also addressed the issue of currency and war in detail.

Toward the end of the convention, the topic of slavery threatened to end the proceedings altogether. Many of the Southern delegates refused to talk about ending of slavery and demanded representation for slaves in the House. Henry and Jefferson, though slave owners themselves, made impassioned speeches against the institution of slavery, stating that the peculiar institution is completely antithetical to the notion of individual liberty and sovereignty. Jefferson proposed a graduated emancipation and abolishment of slavery to be implemented over a number of years by a new federal government. The plan called for a gradual manumission of slavery in ten year stages over the course of three decades. The federal government would allocate the majority of its expenses (paid for by duties, imposts, and excise taxes) to compensating slave owners and helping them transition to a different way of life. Also, slaves would count as representation in the House. Though many Southern delegates were still not completely satisfied, many were persuaded by Jefferson and Henry’s pledges to free their own slaves without compensation as an example to the Convention body. Finally, a provision in the plan to resettle many of the freed slaves in a future territory in West Africa appeased some of the fears of the slave-owning delegates in attendance.

On October 12th, 1787, the final version of the Constitution, based on the amended Henry-Jefferson Plan was signed by 54 of the 62 delegates (all of those refusing to sign were Southern delegates disagreeing with the Slavery Provisions) attending the Convention. The main differences with the OTL Constitution are as follows:

1. Executive made up of three “Consuls”: one elected by an Electoral College (as in OTL), one elected by the Senate, one elected by the House. All three Consuls are limited to a single, six year term. Laws become official when 2 out of the 3 Consuls sign a bill passed by Congress. There is no Vice Presidency.

2. Supreme Court judges are nominated by the House and appointed by the Senate.

3. OTL Bill of Rights are included in the main body and specifically apply to the federal government, not the State governments

4. A list of State rights are included as well, including specific language on the voluntary nature of the Union, the right of secession and nullification, and that the States are sovereign and only delegating authority to a federal government and therefore they may take it back, through amendment or dissolving the Union at any time

5. Explicitly forbids the executive from signing treaties or initiating war, leaving both of these as express powers of Congress and the signing of treaties specifically to the Senate

6. Article 3, establishing the Supreme Court, specifically forbids the practice of judicial review, limiting the scope of the Court’s jurisdiction to the specific language and original intent of the Constitution

7. War debt is forbidden and a system of raising money for defensive wars is established whereby the cost is shared by both the States and the federal government. A provision allowing the Congress to save money for future wars (so as to avoid foreign loans and debt) is also added

8. A militia/army system is established whereby the independent State militias are federalized during wartime (though States can refuse to have their militia federalized if they wish, should they oppose a particular war) and de-federalized during peacetime. The federal government is restricted to having a professional, standing army of no more than one-half the size of all the State militias combined, even during wartime (though the Senate may, through a unanimous vote expand the army to a larger size, though such a measure is only temporary for the term of the war). A draft is specifically prohibited at the federal level.

9. The navy is set up in much the same way as the army, though there is no restriction on the size of the federal navy. The States may create navies which can be federalized during wartime. Both the States and the federal government share the cost of the federal navy.

10. A central bank is specifically prohibited, as is a paper/fiat currency. Gold and silver are established as the only legitimate currencies at the federal as well as State levels.

11. The principles of a free market/free banking system are specifically mentioned

12. Specific language limits Congress to the enumerated powers in Article 1

13. Congress is granted the power to buy and sell land to foreign powers

14. Territory gained by the US is under the jurisdiction of Congress, not the executive

15. The regulation of Commerce within the US by Congress is limited to making trade “regular” among all the States equally (States cannot tax or embargo each other, the establishment of free trade, etc.); language is inserted to protect the States’ rights to regulate trade within their borders, including rivers and bodies of water

16. Slavery will be ended in three stages, each lasting ten years (starting in 1790). Slave owners will be compensated for manumission of slaves, slaves will count for purposes of representation, and an initiative will be created for the return of most freed slaves back to Africa in return for the abolition of the slave trade, no fugitive slave law, and the abolition of slavery, with full rights under the Constitution for those freed, by the year 1820. No new slave States may be added to the Union.

17. A mandate is given to Congress to purchase and establish a colony in Africa for returning freed slaves.

18. The federal government is specifically prohibited from funding internal improvements within the States or bribing the States with money.

19. The only process for proposing amendments is a Constitutional Convention held by ¾ of the States complete with a ¾ quorum of those States holding the Convention to pass amendments. The States do not have to petition Congress for such a Convention to occur. Amendments are stated as the only way to change the Constitution.

20. Congress is given the express authority to negotiate and sign treaties with the Native American nations

21. Federal/national police are prohibited

22. Impeachment trials remain in the courts

23. No General Welfare or Necessary and Proper clauses

1787-1788 – The ratification process went to the States (9 being required for ratification). Unlike OTL, the main division between those supporting and those opposing the new Constitution were those supporting the Slavery Provisions in Article 8 and those opposed. Initially, Virginia, North Carolina, South Carolina, and Georgia were opposed to ratification. Jefferson, Henry, and Madison authored a set of essays collectively called the The Liberty Papers in support of the Constitution generally and arguing for the Revolutionary-era principles of individual liberty and God-given natural rights. Those opposed responded with economic arguments that abolishing slavery would destroy the slave States and marginalize the economic system in the South. Henry, Jefferson, and Madison, all from Virginia, were able to move the Virginia legislature in support of ratification by freeing their own slaves with no financial help. This act and their impassioned speeches before the legislature throughout June 1788 led to Virginia ratifying the Constitution on July 5th, 1788. Similar speeches before the North Carolina legislature were not successful in turning the opinion of the legislators and the Georgia and South Carolina assemblies refused to hear speeches in favor of the Constitution. By October 1st, 1788, the required nine States had ratified the new Constitution, making it officially the Law of the Land.

Following the official ratification, the Succession Crisis of 1788 began with a joint declaration by Georgia and South Carolina that they were opposed to the Constitution and left the Union on December 13th, 1788. North Carolina remained in the Union until March 3rd, 1789 when that State seceded from the Union as well. Georgia, North Carolina, and South Carolina were recognized as free and sovereign nations by the other States. The US retained the Mississippi territory.

1789 – Several European nations recognize the independence of Georgia, South Carolina, and North Carolina. Connecticut becomes the 10th and last State to ratify the US Constitution. In May, the French Revolution begins. George Washington [EC], Thomas Jefferson [H], and James Madison are elected the first Consuls of the US on February 4th and elections for the House of Representatives are held. The US Department of War is created and Congress authorized the creation of an army and navy. The army initially consisted of 48,000 men as the combined strength of the various State militias at this time was estimated at roughly 110,000 men. The US sent requests to their embassies in various countries on Continental Europe for training of the new professional army in exchange for free land and life-time pensions upon retirement. Several Prussian generals express interest in this and Frederick II allows them to move to the US. Several French generals, worried about the increasing violence in France, opt to move to the US and help train the army and the navy. Lafayette, though interested in the proposal, decides to remain in France for now to direct the Revolution. Friedrich von Steuben, though retired and living in the US, comes out of retirement to help train the army as well.
 
This is fantastic. Keep it up.

What happens when the three independent Southern states decide they want to press their claims to the west (at least as far as the Mississippi)? And what will happen to Florida? Does the US get into a bidding war with Georgia (though Georgia probably has no money).

My only point of dispute would be the size of the federal army. After the war of independence in OTL the Continental Army had less than 3,000 men, by the 1790's the American Legion - had maybe 4,000 or so.

But keep going this is great stuff.
 
This is fantastic. Keep it up.

What happens when the three independent Southern states decide they want to press their claims to the west (at least as far as the Mississippi)? And what will happen to Florida? Does the US get into a bidding war with Georgia (though Georgia probably has no money).

My only point of dispute would be the size of the federal army. After the war of independence in OTL the Continental Army had less than 3,000 men, by the 1790's the American Legion - had maybe 4,000 or so.

But keep going this is great stuff.

Thanks! I struggled with how large the professional army should be starting out. I figured 48,000 wasn't impossible for the time period. As far as the independent States go, they only have their territory as of the time of secession, no claims on territory past their western borders.
 
I'm finding this quite interesting.
It's nice to see a quite radically different US.

Will there be a manifest destiny? What about filibusterers (in the sense of setting up countries) ?

While I understand your political beliefs have obviously shaped the TL, I don't see how this could be considered any form of 'flaming'.
 
I'm finding this quite interesting.
It's nice to see a quite radically different US.

Will there be a manifest destiny? What about filibusterers (in the sense of setting up countries) ?

While I understand your political beliefs have obviously shaped the TL, I don't see how this could be considered any form of 'flaming'.

There will be a form of Manifest Destiny, but not in the OTL sense. It will be more or less a push for a New World-wide Republic (and more later), not only within the US, but outside of it, based on the principles of the Enlightenment, Classic Liberalism, anti-colonialism, and in general a desire to unite former European colonies in the spirit of doing things differently than the Old World.

The United States in this TL will by and large only fight defensive wars, not imperialistic wars of conquest. Granted, the end result of these defensive wars will be conquest of new land, but it won't be through aggression and native people (including Native Americans) will be respected much more than in OTL. Basically, there will be a cosmopolitan feel to the US in this TL as it will be truly a "Melting Pot". The underlining idea I am going for is that the larger the "nation" (if you want to call it that) gets, the harder it becomes to have a centralized, national government because the different ethnic groups, cultures, etc. that make up the various far-flung States in this US will value their independence and sovereignty more than anything else, but will also want common defense and security against the empires of Europe. Basically, the States will actually run the Federal government and not the other way around.

The reason I put the disclaimer on my thread is because my libertarian leanings will definitely spill over into the TL. I will mention from time-to-time the prosperity and wealth created due to the free market/banking system in the US and will probably mention at some point international bankers who desire to establish control over the US money supply (as I contend happened early on in our history), but are not successful in this TL. Granted, most of the TL will not mention that, but there will definitely be things in this TL that I know some will want to debate, and though I don't mind debate, I don't want to turn this into a "how do you know libertarianism works?" "No one has ever tried it, therefore it doesn't work" "if it was so great, why doesn't everyone do it" "free markets lead to hoarding wealth and fascism". Of course as far as I'm concerned these arguments are fallacies and the idea that free markets lead to the Corporatism we have today is completely wrong (I contend it is actually Central Banking and regulations that create monopolistic cartelization of industry that then leads to the Corporatism we have today). In a nutshell, I'm worried that the thread will devolve into political arguing rather than just a fun TL.
 
There will be a form of Manifest Destiny, but not in the OTL sense. It will be more or less a push for a New World-wide Republic (and more later), not only within the US, but outside of it, based on the principles of the Enlightenment, Classic Liberalism, anti-colonialism, and in general a desire to unite former European colonies in the spirit of doing things differently than the Old World.

A New World Republic, I like the sound of that.

The United States in this TL will by and large only fight defensive wars, not imperialistic wars of conquest. Granted, the end result of these defensive wars will be conquest of new land, but it won't be through aggression and native people (including Native Americans) will be respected much more than in OTL. Basically, there will be a cosmopolitan feel to the US in this TL as it will be truly a "Melting Pot". The underlining idea I am going for is that the larger the "nation" (if you want to call it that) gets, the harder it becomes to have a centralized, national government because the different ethnic groups, cultures, etc. that make up the various far-flung States in this US will value their independence and sovereignty more than anything else, but will also want common defense and security against the empires of Europe. Basically, the States will actually run the Federal government and not the other way around.
With this melting pot I forsee it to be much easier for arguments over the 'nations' direction coming up, and especially some language arguments.

This sounds much more like a Confederation, maybe use confederal government instead of federal? :confused:

The reason I put the disclaimer on my thread is because my libertarian leanings will definitely spill over into the TL. I will mention from time-to-time the prosperity and wealth created due to the free market/banking system in the US and will probably mention at some point international bankers who desire to establish control over the US money supply (as I contend happened early on in our history), but are not successful in this TL. Granted, most of the TL will not mention that, but there will definitely be things in this TL that I know some will want to debate, and though I don't mind debate, I don't want to turn this into a "how do you know libertarianism works?" "No one has ever tried it, therefore it doesn't work" "if it was so great, why doesn't everyone do it" "free markets lead to hoarding wealth and fascism". Of course as far as I'm concerned these arguments are fallacies and the idea that free markets lead to the Corporatism we have today is completely wrong (I contend it is actually Central Banking and regulations that create monopolistic cartelization of industry that then leads to the Corporatism we have today). In a nutshell, I'm worried that the thread will devolve into political arguing rather than just a fun TL.
I find that Human greed is the key cause of the dismal failings of a free market, if you can make money at the expense of others, someone will hoard it all. Someone will always want to get on top and dominate. This set-up seems very likely to allow that to happen later on. Especially with no regulations.


There's not a strong enough executive to take action quickly, just lots of bickering.

And with some states allowed to say no to helping with troops, people will ask why should the confederal government and the other states protect them? They want to be in for free basically, they don't pull their weight.

If the states are so independent, then in a large war/invasion, some may actively help the enemy(they don't want to secede because they'd lose the market access but they don't like the nations direction), and the congress won't be able to marshal a unified response in time. If a plucky military leader fights the enemy off while congress bickers, the public will probably turn against the decentralisation and to a central leader who can act without trying to please everyone.

What about a Roman style dictator whom is appointed during such times? I know it failed with Caesar, but perhaps that's just the scenario I said about before.
 
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A New World Republic, I like the sound of that.

With this melting pot I forsee it to be much easier for arguments over the 'nations' direction coming up, and especially some language arguments.

This sounds much more like a Confederation, maybe use confederal government instead of federal? :confused:

I find that Human greed is the key cause of the dismal failings of a free market, if you can make money at the expense of others, someone will hoard it all. Someone will always want to get on top and dominate. This set-up seems very likely to allow that to happen later on. Especially with no regulations.


There's not a strong enough executive to take action quickly, just lots of bickering.

And with some states allowed to say no to helping with troops, people will ask why should the confederal government and the other states protect them? They want to be in for free basically, they don't pull their weight.

If the states are so independent, then in a large war/invasion, some may actively help the enemy(they don't want to secede because they'd lose the market access but they don't like the nations direction), and the congress won't be able to marshal a unified response in time. If a plucky military leader fights the enemy off while congress bickers, the public will probably turn against the decentralisation and to a central leader who can act without trying to please everyone.

What about a Roman style dictator whom is appointed during such times? I know it failed with Caesar, but perhaps that's just the scenario I said about before.

Human greed exists when you have a strong executive and a controlled economy as well - except in that case, you have no redress at all (the government is a monopoly on power) and corporations can use their influence to get the government to codify and protect their monopoly by cartelizing them through regulation. That is what we have and have had for a long time - that is not a free market. You can't have a central bank and have a free market. Money is the central issue in an economy. If the State controls that completely, you have no free market, not to mention the huge number of regulations already in place. Yet we have banks with record profits still. Probably because the big banks write the very bills that are meant to supposedly reign them in. That is what I'm trying to avoid in this TL.

With regard to war, given that most wars this US will be fighting are defensive and not offensive, the States will by and large support the wars out of mutual defense. In this TL, a war like the War of 1812 or Vietnam probably wouldn't fly with some of the States. But being attacked is a whole different situation.
 
The problem is that they believe their western borders go at least as far as the Mississippi. Have a look at the map here: http://en.wikipedia.org/wiki/State_cessions

In their views, these aren't claims, they are integral territories. It's going to be an issue.

No I understand that; I mean as part of the treaty recognizing Georgian independence, the US retained the Mississippi Territory. That is recognized by Georgia as legitimate.
 
1790 – The first US census is commissioned in this year. The US Congress passes the Capital Act, establishing a capital for the new nation north of the Potomac. Virginia and Maryland donate land for this new city. The city is named Washington, D.C. A US tariff bill creates the United States Revenue Cutter Service for tariff enforcement due to rampant smuggling. Georgian diplomats arrive in France, Spain, and Britain and officially set up embassies. Later in the year, South Carolina and North Carolina do the same. The US Congress commissions 12 frigates to be completed and manned within the next several years. Though the cost of the naval program is more expensive than some in Congress had been willing to invest, the overall cost is distributed between the States and the Federal government in such a way, that the building of the new ships does not hurt the Federal budget too badly. In addition, the free market and banking system in the US (with no OTL First Bank of the US in existence) has helped expand Federal revenue 7-9% higher than in OTL US of the same year.

1791 – Vermont is admitted to the Union as the 11th State. Construction starts on the new capital on the Potomac. A slave rebellion breaks out in Haiti, a French colony. Several foreign generals helping to train the US army push for the establishment of a formal military academy. In France, Francisco de Miranda, a Venezuelan revolutionary, joins the French Revolutionary Army.

1792 – The United States Postal Service is established. Raleigh becomes the new capital of the Republic of North Carolina. The US Mint is established in this year. Georgia seeks an alliance with France and secretly agrees to send an expeditionary force to help quell the slave rebellion in Haiti, fearing the example of a successful slave uprising on their own slave population. Kentucky is admitted as the 12th State. Fearing for the increased violence of the French Revolution and his own personal safety, Gilbert du Motier, Marquis de Lafayette, an American Revolutionary War hero, flees to the United States through the Dutch Republic, seeking political asylum. Lafayette arrives in Boston in December despite nearly being captured by the Austrian army. By this time, nearly 26,000 men form the core of a highly trained and disciplined United States professional army. At the urging of several foreign generals, and especially of von Steuben, Congress establishes the US Marine Corp as a maritime arm of the Army. The War of the First Coalition begins in Europe with Prussia, Britain, Austria, Spain, the Kingdom of Naples, and the Kingdom of Sardinia declaring war on France in an attempt to contain revolutionary France.
 
I'll pm you later about politics so this thread doesn't become that.

Doesn't a postal service and a mint mean centralisation? In a free market shouldn't private enterprise handle post?
 
I'll pm you later about politics so this thread doesn't become that.

Doesn't a postal service and a mint mean centralisation? In a free market shouldn't private enterprise handle post?

Not necessarily. In OTL US, we had a mint and at the very same time we had a situatation (at least in the very beginning) where even private citizens could take their own gold to be minted at the Federal Mint OR could even mint coins themselves. In fact in OTL, for a short period of time, private minters were very popular AND they had extremely high quality coins (in many cases of higher quality than those coming from the Federal Mint). Just because there is a US Mint, that doesn't mean it has to control the entire process of minting coin. In OTL, competition guaranteed high quality privately minted coin. Research it.

This is a much more libertarian US, but the government still has a function and a role. In this case, it is mostly to protect life, liberty, and property, but it is also those functions delegated to it; in this case, a mint and a postal service are clearly delegated to it, just as in OTL. I have no problem with the Federal government doing those things which it was delegated to do in the Constitution; libertarians like me have a problem with the government exceeding its delegated authority or interpreting new powers out of thin air.
 
Not necessarily. In OTL US, we had a mint and at the very same time we had a situatation (at least in the very beginning) where even private citizens could take their own gold to be minted at the Federal Mint OR could even mint coins themselves. In fact in OTL, for a short period of time, private minters were very popular AND they had extremely high quality coins (in many cases of higher quality than those coming from the Federal Mint). Just because there is a US Mint, that doesn't mean it has to control the entire process of minting coin. In OTL, competition guaranteed high quality privately minted coin. Research it.

This is a much more libertarian US, but the government still has a function and a role. In this case, it is mostly to protect life, liberty, and property, but it is also those functions delegated to it; in this case, a mint and a postal service are clearly delegated to it, just as in OTL. I have no problem with the Federal government doing those things which it was delegated to do in the Constitution; libertarians like me have a problem with the government exceeding its delegated authority or interpreting new powers out of thin air.

I never knew that. But wouldn't it allow people to make themselves rich simply by being rich, or with an independent mint, to allow someone to 'water down' the gold content? Especially if it's far away from oversight.

What happens if a private mail service is bigger, better, and cheaper? Would the government keep funding their own?
 
I never knew that. But wouldn't it allow people to make themselves rich simply by being rich, or with an independent mint, to allow someone to 'water down' the gold content? Especially if it's far away from oversight.

What happens if a private mail service is bigger, better, and cheaper? Would the government keep funding their own?

Not really. Back in beginning of this nation, people had a choice to take their gold/silver to a government Mint or to one of many private minters. The reason it worked is because competition kept the private minters from debasing the coin they minted. If a minter did debase the coins minted, he would lose business - fast. And there would be no bailouts of his business. Think about it this way: when you have a Central Bank, the government is the one, without oversight, doing the "watering down". And quite a bit of watering down may I add. What, after all, is the main function of a paper/fiat currency? To water it down, debase it, inflate it. That's the entire purpose. What in practical terms is the difference between a government or private individuals counterfeiting? Absolutely none, except that the government can and will do it on a much larger scale and it has no competition to keep it in check.

As far as mail is concerned, sure a private company could deliver mail faster and more efficiently or cheaper than a government postal service. If that happens, I suppose the government could chose to stop funding its own service.
 
Not really. Back in beginning of this nation, people had a choice to take their gold/silver to a government Mint or to one of many private minters. The reason it worked is because competition kept the private minters from debasing the coin they minted. If a minter did debase the coins minted, he would lose business - fast. And there would be no bailouts of his business. Think about it this way: when you have a Central Bank, the government is the one, without oversight, doing the "watering down". And quite a bit of watering down may I add. What, after all, is the main function of a paper/fiat currency? To water it down, debase it, inflate it. That's the entire purpose. What in practical terms is the difference between a government or private individuals counterfeiting? Absolutely none, except that the government can and will do it on a much larger scale and it has no competition to keep it in check.

As far as mail is concerned, sure a private company could deliver mail faster and more efficiently or cheaper than a government postal service. If that happens, I suppose the government could chose to stop funding its own service.


My scenario was meant to be more of (in simple form):

Rich person makes private mint.
People with 100 gold pieces come and can have 100 gold coins made, but says owner, if I add a little bit of copper, you can have 110 gold coins, and as we're so far away from government oversight (or if it's near they can be bribed) no one will know and us rich folk can get richer without anyone knowing.

I'll come to the fiat currency in my pm, I really must start it...
 
My scenario was meant to be more of (in simple form):

Rich person makes private mint.
People with 100 gold pieces come and can have 100 gold coins made, but says owner, if I add a little bit of copper, you can have 110 gold coins, and as we're so far away from government oversight (or if it's near they can be bribed) no one will know and us rich folk can get richer without anyone knowing.

I'll come to the fiat currency in my pm, I really must start it...

The problem with that scenario is that in the short bursts of time, especially in the early US where free banking largely went unhindered by the government, this really didn't happen. Anytime a private minter had low quality coins or attempted to debase the coins minted, he would lose business and go bankrupt. Combine that with competition and they stayed in line. The banks acted as clearing houses on each other. Look also at the system of free market banking in Scotland between roughly 1750 and 1820/30. While in England hundreds of banks failed and inflation was rampant under the Bank of England, in neighboring Scotland only 1 or 2 banks failed in the same time period and the money increased in value, with inflation being nearly non-existent.

The system we have now with the Federal Reserve is the system that make the "rich get richer and the poor get poorer", along with destroying the Middle Class. A Central Bank does nothing but debase and counterfeit, that's it's job...and there is absolutely no oversight of that process. The rich "Money Interests" of the late 19th/early 20th Century like Paul Warburg and JP Morgan not only helped craft the bill in 1910, they used their stooge in the Senate, Senator Aldrich to pass the second draft of the bill, the Federal Reserve Act (the first incarnation was the Aldrich Bill and the public knew he was a stooge of the big bankers so it failed). The point is, these rich people were able to buy politicians and craft a bill that created a quasi-governmental, quasi-private banking cartel to protect their profits and DESTROY COMPETITION. This system is called the Federal Reserve. So under this system, the rich folks you are talking about still find a way to hoard wealth, get richer at the expense of others, basically own the government, and in the case of a central bank, own the entire economy. In other words, they wrote a bill meant to reign them in, which has done nothing but institutionalize their monopoly and profit.

The thing I never understood is how people on the other side of the political spectrum from me can decry human greed and the greed of the rich specifically, but desire a powerful government, made up of these same greedy people (and often specifically greedy rich people) to fix the problem of greedy rich people. It makes no sense to me. The government, just like private corporations, are made up of people, all of them greedy to a certain extent. In a free market, a corporation with actual competition, no government backing or insurances, and which must compete for its survival for customers and labor, will not be able to screw people over for long - because they will be bankrupt. In other words, in that scenario, you have redress to fix a problem. With the government, it has total 100% control - a monopoly on power. There is no redress if the government screws you. Now take what we have - a system where the most powerful corporations in many sectors of the economy have written bills and regulations (supposedly meant to reign them in) that have done nothing but kill their competition and codify their monopoly. So now we have corporations basically owning the government and this same government, run by these greedy billionaires for their exclusive benefit, is the one you want controlling and running everything with a monopoly on power?

It makes no sense.
 
Update:

1793 – Francisco de Miranda, after being tipped off by a colleague in the French Revolutionary Army that he was going to be arrested and prosecuted for “conspiring against the Republic”, flees to the Dutch Republic and then Britain, before boarding a ship bound for New York in September. Miranda arrives in the US in October and offers his services to Congress as a general, hoping to train the growing professional US army. Congress accepts and grants him a commission within the army. During this time Miranda begins to write down his ideas and aspirations for a hemisphere-wide Republic, from Canada to Patagonia and including all the current and former colonies of European powers, based on the principles of the Enlightenment and the US constitutional system, under the pen name Cicero. His collection of writings eventually becomes known as the Letters for the Formation of an Empire of Liberty and eventually would become the basis for a group of Republicans, calling for worldwide Republicanism, free trade, free markets, natural rights, and Federalism, to form into the First Republican International in 1816. Many of Miranda’s points and aspirations form the founding principles of the FRI. The Spanish invade Haiti in an attempt to quell the slave rebellion and conquer the French colony. Georgia, despite having its alliance propositions rejected by the French Republic, sends a small expeditionary force of 6,500 men to Haiti and supplies for the former plantation owners on the southern part of Haiti not yet controlled by the rebels. Louis XVI is guillotined in Paris.

1794 – Congress creates the American Colonial Committee, an organization initially charged with hiring privateers to explore the western coast of Africa and found an initial settlement for the eventual resettlement of freed slaves. The first privateers leave for Africa by July hoping to be the first to reap a handsome reward for finding a suitable settlement. Eli Whitney is granted a patent for the Cotton Gin. The British capture Port-au-Prince, but later in the year are forced to withdraw due to a combination of disease and Toussaint L’Ouverture’s brilliant campaign to drive them into the sea. Georgian troops reinforce the southern part of Haiti, helping white plantation owners hold off the rebels for the time being. A complaint by the US to the British regarding British occupation of border forts in the Northwest Territory and an end to British support for Native Indians in the area is rejected, directly insulting the US ambassador in the process. This incident, the Northwest Incident, incites public opinion in the US, but the Consuls work hard to avoid war between the two countries (this is made easier by Hamilton’s affinity for the British Empire and system of governance/economics). Congress commissions the first official US military academy, the Friedrich von Steuben War College located at Concord, Massachusetts. The college is named after the esteemed Prussian general after his death in February of this year. New York and New Jersey issue the Joint Proclamation, issuing a two-year plan to abolish slavery within their territory.

Elections in the US: Patrick Henry (EC), John Adams (H), and John Jay (S) are elected Consuls of the US.

1795 – The Kingdom of Hawaii is proclaimed by Kamehameha I. A combined Haitian/Georgian/Spanish force is defeated by Toussaint L’Ouverture after an attempted re-conquest of Port-au-Prince. A treaty leads to the end of the war between France and Spain later in the year and France is granted the Spanish half of Hispaniola. Georgia officially withdraws from Haiti due to the losses at Port-au-Prince. The US army defeats a confederation of Indians in the Northwest Territory decisively, putting an end to the “Northwest Indian War”. Congress ratifies a treaty with the Western Confederacy promising them land in OTL northwestern Indiana/southwest Michigan and eventual path to statehood if they discontinued their relationship with the British. The majority of the tribes agree to the provisions of the treaty, with Tecumseh of the Shawnee being key in forging an agreement between the tribes to stop fighting the US and organize an eventual sovereign Native State within the Union. The Treaty of Three Fires between the US and the Western Confederacy angers the British, pushing the two countries closer to war. Only timely diplomacy by Hamilton averts war with the British. The Hamilton Treaty ensures American sovereignty over the Northwest Territory and the British officially hand over control of Detroit to US forces. In addition, Hamilton was able to get the British to commit to ending the practice of seizing US merchant ships trading with France. Despite the peaceful resolution to the crisis, anger persists on both sides. The Treaty of Madrid is signed between the US and Spain, setting boundaries between the two countries and ceding northern Spanish western Florida to the US. By this year, State militias have expanded to roughly 140,000 men and Congress expands the Army by another 15,000 men. The first 7 frigates of the US navy are completed and Congress commissions another 5 frigates in addition to the other 5 still in construction.

1796 – Several US merchant ships are captured by Barbary pirates from Algeria while delivering trade goods to southern France. The US demanded that the Dey of Algiers free the merchants, to which the Dey responded by executing the captain of one of the US ships captured. This enrages the public and Congress declares war against Algiers in May, followed by a declaration of war by Morocco, Tunis and Tripoli on the US in support of their mutual ally Algiers. In August, a squadron of three US frigates and a dozen State naval ships win a naval battle against Morocco and Algeria off the coast of Morocco. In September, US marines land ten miles west of Casablanca and defeat King Slimane of Morocco, killing him in the process. US forces quickly occupy Casablanca and the US squadron enters the Mediterranean by early January 1797. Spain and France form an alliance against Britain. Tennessee is admitted as the 13th State. American privateers hired by the American Colonial Committee found a small settlement called Liberty Town on the Pepper Coast in Africa near OTL Monrovia. The settlers build a small fort to protect the settlement called Fort Washington.

New York and New Jersey officially abolish slavery and former slave owners are compensated generously. In response to this, Delaware begins the process of gradual manumission of slaves within its territory to be completed by 1800. Both the British and the French begin intercepting ships from the various American Republics trading with their adversary. The US is particularly outraged as the British broke the agreement reached just 10 months prior in the Hamilton Treaty. The public, though calling for blood, is calmed by politicians calling for neutrality and pragmatism with the prospect of war with two of Europe’s most powerful countries on the horizon. Georgia and North Carolina sign a treaty that results in both nations boycotting both British and French goods and both move to arm their merchant ships against further aggression from either side. Both Republics also stop trading with the belligerent European powers, sending their economies into a downward spiral. South Carolina, beholden to both powers because of loans taken out over the course of the past several years, takes no action against either power. The US condemns both powers and though it takes no action, most of the public and those in power realize the immediate need for a strong army and navy in preparation for war with either or both of the belligerents. In reaction to the recent string of near-wars, Congress passes the Expansion Act, a bill which calls for a doubling in the size of the Navy and encourages the States to expand their State militias vigorously. All of the States respond with legislation of their own, laying the groundwork for a much expanded militia network in the next few years and eventually a larger Federal Army.
 
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