THE ORIGINS OF THE FEDERAL RESERVE

Murray N. Rothbard reports:

The Federal Reserve Act of December 23, 1913 was part and parcel of the
wave of Progressive legislation, on local, state, and federal levels of government,
that began about 1900. Progressivism was a bipartisan movement
which, in the course of the first two decades of the twentieth century, transformed
the American economy and society from one of roughly laissez-faire to one of
centralized statism.
Until the 1960s, historians had established the myth that Progressivism was a
virtual uprising of workers and farmers who, guided by a new generation of
altruistic experts and intellectuals, surmounted fierce big business opposition in
order to curb, regulate, and control what had been a system of accelerating
monopoly in the late nineteenth century. A generation of research and scholarship,
however, has now exploded that myth for all parts of the American polity, and
it has become all too clear that the truth is the reverse of this well-worn fable. In
contrast, what actually happened was that business became increasingly competitive
during the late nineteenth century, and that various big-business interests, led
by the powerful financial house of J.P. Morgan and Company, tried desperately to
establish successful cartels on the free market.

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