Unruly State of Affairs in the United States of America

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Silver bullet to your rights secured by the Constitution

A treatise on State Citizenship

American people are born upon the land and soil of this state - where they are not newborn on any territory owned by or ceded to the United States.  No person of authority shall by obscurity impede the identity rights of the new baby and the proprietary and intellectual property right of both the mother and the father.

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Important Note:  Edited into this information during early March 2023, long after this page was originally posted on line, a very young law school student at Utah was gunned down and murdered viciously by a group of police officers while stopping the man for not having a license plate on his car. Then as he rightfully told the citing officer that he is not theirs to detain or harass, the officer immediately escalated the situation, as a complete lawless thug. The young man's mother and he were involved in suing the same police agency for crimes that had been committed in the recent past. Police saw a lawfully owned firearm in the man's car during this stop, yet that man did not have his hands on the firearm and was not threatening officers. Officers yelled "gun-gun-gun-gun" and then shot 12 rounds into the man in less than 2 seconds from various angles - killing him instantly.  

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At the end of this treatise, is standing case law on citizenship and a 2-page example on how to fill out the passport form

 

Free yourself from tyranny

 

Everyone has tried many complicated and time consuming things to retrieve their rights that are secured by our constitutions, and to stop unconstitutional traffic tickets, taxes, prosecutions, foreclosures and lawsuits. I will not go into all that has been tried, happened and failed. It would be too time consuming and most would not understand.  I will give a brief description of how this works.

When you got your Social Security number, either you or your Mom or Dad checked off that you were a U.S. citizen on the SS-5 application. And then you continued to claim to be a U.S. citizen throughout your life and did so on all of the government forms and applications when you signed and/or filed which caused you to pay taxes, get tickets and every other act of treason that has happened to you.

The U.S. in this case, is the federal corporation, the District of Columbia, also known as USDC or the UNITED STATES.  Said corporation was created by the congressional act of 1871. Also see 28 U.S.C. 3002 (15) “United States” means — (A) a Federal corporation ….

So a U.S. citizen is a citizen of this federal corporation, and not a union State or USA republic.

So now it’s easy to see that a U.S. citizen is a legal fiction / U.S. corporation franchise and has no rights secured by the constitution. Only people have rights secured by the constitution, not legal fictions. You should have checked off “other” on the SS-5 form because you are a State Citizen of your State that you were born on, which makes you a Citizen of all states, and one of the people, and a beneficiary of, the republic U.S.A. constitution of 1789/1791. A State Citizen used to be known as a Citizen of the United States before the Civil War, but the meaning has been changed twice for the purpose of fraud. 

The United States of America is the de jure republic government, not the United States which is the corporation. The preamble to the constitution establishes the United States of America, not the United States. So we have Two Different and Distinct National Governments. This treachery has always been the goal of the enemy, which turns out to be Great Britain and the Vatican.

See case law….

"The idea prevails with some, indeed it has expression in arguments at the bar, that we have in this country substantially two national governments; one to be maintained under the Constitution, with all its restrictions; the other to be maintained by Congress outside and independently of that instrument, by exercising such powers as other nations of the earth are accustomed to... I take leave to say that, if the principles thus announced should ever receive the sanction of a majority of this court, a radical and mischievous change in our system will result. We will, in that event, pass from the era of constitutional liberty guarded and protected by a written constitution into an era of legislative absolutism... It will be an evil day for American Liberty if the theory of a government outside the Supreme Law of the Land finds lodgment in our Constitutional Jurisprudence. No higher duty rests upon this court than to exert its full authority to prevent all violation of the principles of the Constitution."

 

--Honorable Supreme Court Justice John Harlan

in the 1901 case of Downes v. Bidwell

 

 

It’s all about thy citizenship.  It’s that simple.

It's been an Unruly State of Affairs.

 

See case law:

"Taxpayers are not [de jure] State Citizens."

 

Belmont v. Town of Gulfport, 122 So. 10.

 

"The term resident and citizen of the United States is distinguished from a Citizen of one of the several states, in that the former is a special class of citizen created by Congress."

U.S. v. Anthony, 24 Fed. 829 (1873)

 

So you can see in the above case citations that there are two national governments and at least two types of citizens.  There are actually many more types of recognized citizens including a 14th amendment citizen.  But this treatise only concerns two.  More case law on citizenship listed at the end.

So to reclaim your citizenship, you need to certify your citizenship by getting a passport as a “State Citizen”. Your birth certificate that is required for your passport is proof that you are a State Citizen. However you will not find the term “State Citizen” on government forms because they are deceptively hiding it from the public.  They use terms such as “non-citizen national”, “national” or “other”. When you get your passport it will look like any other and say that your nationality is the United States of America.  This is true if you are a State Citizen, 14th amendment citizen or a U.S. citizen.  They do this to hide what they are doing. Remember that the U.S. citizen is a legal fiction, (a U.S. Corporation) with no rights. A 14th Amendment citizen has little rights. A State Citizen has absolute freedom and liberty protected by our founding documents. You are not a legal fiction, nor a U.S. corporation/US citizen, nor are you a 14th amendment citizen.

You are a State Citizen of the state you were born in,

which makes you a Citizen of all of the States, and

a non-citizen national of the United States of America.

passport1

SEE THE EXAMPLE PASSPORT FORM

ON THE LAST TWO PAGES OF THIS TREATISE.

 

The two main things to remember on the Passport form, is to….

  1. Put all zeros for the social security number:  000 00 0000
  1. They may give you a hard time about this; just continue to insist it’s okay and for them to send it in. The social security number is voluntary. If you put down your real number, then you are allowing the federal corporation and everyone else to come after you.
  1. Every place that it asks if someone is a U.S. citizen, you check off no. If you check off yes, then that makes you a U.S. citizen. Otherwise you are a state Citizen.  NO ONE IS A U.S. CITIZEN.  Not you, or your spouse, or your ex-spouse or your mom or dad. This is the most important step.  No to U.S. citizen on everything.
  1. Do not let them bully you into giving your Social Security number or check off yes to U.S. citizenship.

 

Additional things you can do are:

  1. Put “In care of:” with the mailing address and use the standard mailing address with zip code. This means that this is merely where you receive your mail and you do not live in their jurisdiction. And for the permanent address, use “R.F.D.” or “Rural Free Delivery” for the address and then the city and spell out the name of the state. Then use all zeros for the zip code. This means that you live in the Republic and not in any fictional jurisdiction.
  1. Put “without prejudice” above your signature. This insures that you are not a legal fiction and are not contracting away your rights. Although this should not be needed as a State Citizen.
  1. Expedite your passport. The faster you get it, the faster you will be free. In addition, the State Department will delay your passport to the maximum allotted time otherwise. They do not want you to have it.
  1. Do not check the status of your passport with your social security number. If you do, then you are confirming that you have one, and it will be linked to the passport. Of course you may not get a status report, but it is a trap to get your ss number.

 

The first two things is the most important.  (1) All zero’s for the social security number, and (2) no to all questions on U.S. Citizenship. If you fail or neglect the others it should be of no consequence. But I did all. If they give you any flack, just insist they send it in as is, that the State department will make that determination.

Even if you already got a passport before or have a current passport, you can get a new passport with this method by doing another DS-11.

It’s my understanding that most all the laws mentioned on the Passport form are for U.S. citizens and not for State Citizens. And they only have to do with TIN numbers issued by the IRS. Not a number issued by social security. Notice the last line on the application about your social security number says that it is voluntary. And further, it is a felony punishable up to 5 years for them to compel your social security number from you. See 42 U.S.C. 408(a)(8).  So they are only there to scare you into compliance.

I personally have done all of the above for myself and others.

 

Traps to avoid. 

  1. Do not put down that you are a U.S. citizen on anything.  They used to have places on the form to check off State Citizen but not anymore. The usual choice they give you is “other” or “non citizen national”. (Yes, they make it as confusing as possible.)  Either is ok. So check off either “non-citizen national” “national” or “other” for your citizenship. Or the form may only have a yes or no question if you are a U.S. citizen. Check off no. Checking off no to U.S. citizenship does not prevent you from benefits or rights.

 

  1. Your social security number is voluntary. Use all zeros for the social security number if you wish to not use it. You can use the SS number if you want to pay into Social Security or do anything else. But I would suggest you reserve it for “have to” situations. Most banks will not let you open an account without one. So it does not hurt you to use it if you need to. But it is a felony for anyone to compel your social security number from you.  See:  42 U.S.C. 408(a)(8).

 

  1. Always put the phrase “without prejudice” with your signature.  State Citizens do not have to do this.  But it sure does not hurt.  It means you are not giving up any rights or otherwise contracting.  See UCC 1-308, which was formerly UCC 1-207.

 

  1. Do not check the status of your passport with your social security number.  If you do, then you are confirming that you have one, and it may be linked to the passport.  Of course you may not get a status report, but it is a trap to get your ss number.

 

When you get a job, fill out the I–9 form. Check off “non-citizen national”.  You can use your social security number here if you wish, but the form itself says it is voluntary. But you do not have to. The employer has the choice of your passport for ID or both your DL and SS card. Use your passport for ID. Claiming State Citizen does not prevent you from getting any benefits from anything. Sign everything with the phrase “without prejudice”. Check off tax exempt. You do not have to file taxes. If you feel uneasy about not paying taxes, you can continue to pay them and see how your passport works for you. But you are only feeding the U.S.D.C. beast that is enslaving the country.

When you buy a gun and fill out the form, do not check off that you “have renounced your U.S. citizenship”.  You never were a U.S. citizen, so there is no citizenship to renounce. I have bought plenty of guns since.

Never put down you live in the United States.  You live in the United States of America (U.S.A.).  Or, simply say you live in America.

Once you receive your passport, you should never have to pay taxes, you can carry any gun, you should not get tickets, you do not need licenses permits and fees, the bills of exchange will work they cannot come after you for debt or foreclosure. You may get a few letters for not paying debt, but you cannot be sued for it. Simply send back any summons with a cease and desist letter as mentioned later. The only thing you cannot do is cause injury. They can arrest you for causing injury to someone. And anyone that causes injury needs to be arrested.

Even though you can do all these things, I highly recommend that you do not shove it in their face. Be on good behavior and do not draw attention to yourself. Also give any police officer a friendly chance to discover who you are. Hand him whatever he asks for. Most usually you will not get a ticket. If he writes you a ticket, sign it “without prejudice” and forget it. Do not go to court. There is nothing they can lawfully do. If you receive a letter from the court, send them a cease and desist letter identifying yourself as a State Citizen, with a photo copy of your birth certificate and your passport to each and every letter. There is nothing they can lawfully do. DO NOT GO TO COURT, THERE IS NOTHING THEY CAN LAWFULLY DO. Always use the passport for your ID where possible. I highly recommend that you order the card, to carry in your wallet or purse. When the officer runs your ID, he/she will see your status and has to let you go. The status most law enforcement sees on your background check is similar to the following.

RED FLAG

DO NOT STOP, DO NOT DETAIN, DO NOT INTERROGATE.

LIFE TIME CONCEALED WEAPONS PERMIT.

 The latter is to mislead the officer on why you may have a gun on you. You have your second amendment rights back. I always try to educate the officer on citizenship. But their overseers mislead them from the truth.

I have received a passport using this method. And so have many others using this method. I don’t pay income taxes, I do not get tickets, I do not have to register things or get permits or licenses, and I am left alone for the most part. Remember that most insurance companies will not insure your car if you do not have a license, but then again, you do not have to buy insurance. So weigh your options.  The first two steps in getting a passport are the most important. Don’t worry if you do not get the other steps done.

I have found this to be the silver bullet. It is the difference between night and day. Foreclosures are stopped cold because they cannot collect debt against a State Citizen valued in anything other than gold and silver coin. See USA Constitution Article 1, Section 10.  Federal Reserve Notes are not gold and silver coin, nor are they valued as such.  Prison sentences for those out on bond have gone away, real estate taxes have disappeared, and I can go on and on. But experiences do differ throughout America.

See how the passport works for you on small things before you go to bigger things. If you do not get tickets or other types of non violent misdemeanors, then you did it right.

The last two pages of this treatise are an example of how the form may be filled out.  Do not sign it until you are in front of the acceptance agent.

This treatise is not to be taken as legal advice, and I do not accept any liability for what you do with the information. Please do not share this treatise with those of questionable morals.

About Taxes

Article I, Section 10 of the USA 1789/1791 Constitution prohibits States from using anything but actual gold and silver coin as tender and payment of debt.  So how do they tax you in Federal Reserve notes?  Federal Reserve notes are defined as obligations in 18 U.S.C. 8. And 31 U.S.C. 3124 prohibits states from taxing federal obligations except for corporations. So if a U.S. citizen or resident alien can be taxed in Federal Reserve notes, then they are a corporation.  A State Citizen is not, and no unconstitutional tax can be levied against a State Citizen.  Since many across this nation has figured out the citizenship fraud, and are correcting the fraud via passport, the enemy is in panic.  The IRS has the right to inquire about taxes if you cannot prove State Citizenship.  See: "Unless the defendant can prove he is not a citizen of the United States, the IRS has the right to inquire and determine a tax liability." U.S. v. Slater, 545 Fed. Supp. 179,182 (1982).

So make a photo scan of your passport and your birth certificate.  Then make sure that you include both copies with any correspondence with government.  If you receive letters from any government entity, mail them the birth certificate and the passport with a letter telling them to cease and desist.  Do this for each and every letter they send you.  Do not let them scare you.  Then they are finished. This goes for any government entity.  The following is a sample letter of cease and desist.

“It is a fact, that I am a State Citizen and not a U.S. citizen slave.  My birth certificate is proof of this fact.  Further the State Department has certified this fact.  And it is a fact that I always retain all of my rights.  You are depriving me of my right, to the pursuit of happiness and tranquility.  I order you to cease and desist. “

Do not panic should you receive scare letters.  They are meant to scare you into capitulation.  They are meaningless, but they look like they have official jurisdiction and sites lots of law and etc.  They most typically use words such as offer, request, proposal, notice of non filing, possible prosecution, (note the word possible) and etc.  And the enemy sometimes stuffs your mailbox full of these official looking scare letters, to enhance the scare factor (4 or 5 at a time.)  And send them often.  They are trying scare you into obedience.  These letters are carefully crafted to leave you shaking with fear.  The people who receive them, send back a cease and desist letter with a copy of their passport and birth certificate.

This should be your reply with a scanned copy of your passport and birth certificate to each and every letter you receive from any source on any subject.  Should you receive follow up letters, simply send the same thing each and every time.  You include the passport and birth certificate because it is proof of your State Citizenship.

I personally received a letter that said I had “10 days to comply with their request.  I laughed out loud, and threw it in the trash.  Complying with a request, proposal, notice of non filing, offer of settlement or anything with such wording is not mandatory.  And had they used words like demand, amount due, tax court, I answer with a cease and desist letter with a copy of my passport and birth certificate and do not let them scare you with any threat.

DO NOT LET THEM SCARE YOU INTO COMPLIANCE.

Fear is their only tool.

 

Example of how to fill out the current passport form is on the last two pages.

 

State citizenship Case Law

 

"The term resident and citizen of the United States is distinguished from a Citizen of one of the several states, in that the former is a special class of citizen created by Congress."

U.S. v. Anthony 24 Fed. 829 (1873)

 

“We have in our political system a government of the United States and a government of each of the several States.  Each one of these governments is distinct from the others, and each has citizens of it’s own ....”

 

United States v. Cruikshank, 92 U.S. 542 (1875)

 

“...he was not a citizen of the United States, he was a citizen and voter of the State ....”  “One may be a citizen of a State an yet not a citizen of the United States”.

 

McDonel v. The State, 90 Ind. 320 (1883)

 

“That there is a citizenship of the United States and citizenship of a state ....”

 

Tashiro v. Jordan, 201 Cal. 236 (1927)

 

"A citizen of the United States is a citizen of the federal government ...."

 

Kitchens v. Steele, 112 F.Supp. 383

 

"Taxpayers are not [de jure] State Citizens."

 

Belmont v. Town of Gulfport, 122 So. 10.

 

"the term 'citizen' in the United States, is analogous to the term ‘subject’ in common law; the change of phrase has resulted from the change in government."

 

State v. Manuel, 20 NC 122

 

"The privileges and immunities clause of the 14th Amendment protects very few rights because it neither incorporates the Bill of Rights, nor protects all rights of individual citizens. Instead this provision protects only those rights peculiar to being a citizen of the federal government; it does not protect those rights which relate to state citizenship."

Jones v. Temmer, 89 F. Supp 1226

"The only absolute and unqualified right of a United States citizen is to residence within the territorial boundaries of the United States."

 

U.S. v. Valentine, 288 F. Supp. 957

 

The Amendment (14th) recognized that "an individual can be a Citizen of one of the several states without being a citizen of the United States," (U.S. v. Anthony, 24 Fed. Cas. 829, 830), or, "a citizen of the United States without being a Citizen of a state."

Slaughter-House Cases, supra;

 cf. U.S. v. Cruikshank, 92 U.S. 542, 549 (1875))

 

A more recent case is Crosse v. Bd. of Supervisors, 221 A.2d 431 (1966), which says:

 

"Both before and after the Fourteenth Amendment to the federal Constitution, it has not been necessary for a person to be a citizen of the United States in order to be a citizen of his state."  Citing U.S. v. Cruikshank, supra.

 

The courts presume you to be a federal citizen, without even telling you that there are different classes of citizens. It is up to you dispute this.  See:

"Unless the defendant can prove he is not a citizen of the United States, the IRS has the right to inquire and determine a tax liability."

 

U.S. v. Slater, 545 Fed. Supp. 179, 182 (1982)

"There are, then, under our republican form of government, two classes of citizens, one of the United States and one of the state".

 

Gardina v. Board of Registrars of Jefferson County

160 Ala. 155; 48 So. 788 (1909)

 

"The governments of the United States and of each state of the several states are distinct from one another.  The rights of a citizen under one may be quite different from those which he has under the other".

 

Colgate v. Harvey, 296 U.S. 404; 56 S.Ct. 252 (1935)

 

"... rights of national citizenship as distinct from the fundamental or natural rights inherent in state citizenship".

 

Madden v. Kentucky, 309 U.S. 83:  84 L.Ed. 590 (1940)

 

"There is a difference between privileges and immunities belonging to the citizens of the United States as such, and those belonging to the citizens of each state as such".

Ruhstrat v. People, 57 N.E. 41 (1900)

 

"... the first eight amendments have uniformly been held not to be protected from state action by the privilege and immunities clause [of the 14th Amendment]."

 

Hague v. CIO, 307 U.S. 496, 520

 

"The right to trial by jury in civil cases, guaranteed by the 7th Amendment…and the right to bear arms guaranteed by the 2nd Amendment…have been distinctly held not to be privileges and immunities of citizens of the United States guaranteed by the 14th Amendment…and in effect the same decision was made in respect of the guarantee against prosecution, except by indictment of a grand jury, contained in the 5th Amendment…and in respect of the right to be confronted with witnesses, contained in the 6th Amendment…it was held that the indictment, made indispensable by the 5th Amendment, and trial by jury guaranteed by the 6th Amendment, were not privileges and immunities of citizens of the United States, as those words were used in the 14th Amendment. We conclude, therefore, that the exemption from compulsory self-incrimination is not a privilege or immunity of National citizenship guaranteed by this clause of the 14th Amendment."

 

Twining v. New Jersey, 211 U.S. 78, 98-99

 

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passport3

 

State Citizenship Test

 

The following are some of the citizenship questions you will see on various government forms styled in a way to deceive you out of your rights secured by the original constitution of our republic. United States of America and the original State constitutions.  They have stopped using the term State Citizens on all of the forms for the purpose of constructive fraud.

Answers at the end.

Which answer should a State Citizen choose?

 

A. Social Security form SS 3 application.

B. It is most important to be familiar with this form. This is the form that automatically removes you citizenship and rights. On this form are the following choices. Which answer should a State Citizen choose?

    1. U.S. Citizen

    2. Legal alien allowed to work

    3. Legal alien not allowed to work

    4. Other

C. On employee Eligibility Verification Form I-9 form. Which answer should a State Citizen choose?

    1. A citizen of the United States

    2. A noncitizen national of the United States 

    3. A lawful permanent resident

    4. An alien authorized to work

D. Questionnaire for National Security Positions. Form 86. Which answer should a State Citizen choose?

    1. I am a U.S. citizen or national by birth, or U.S. territory/commonwealth.

    2. I am a U.S. citizen or national by birth born to U.S. parent(s) in a foreign county.

    3. I am a naturalized U.S. citizen.

    4. I am not a U.S. citizen.

E. If you receive a CP 59 form or other letter from the IRS, You will tell them that you are a State Citizen and to cease and desist. Be sure to include a copy of your birth certificate and passport. If you receive the CP 59 form to complete, which answer should a State Citizen choose? 

 

Explain why you do not have to file a tax return. (From 2013 CP 59 form)

My filing status was:

  1. Head of Household
  1. Married filing jointly
  1. Married filing separately

The following applied to me:

  1. I was 65 or older
  1. I am blind
  1. My spouse was 65 or older
  1. My spouse is blind
  1. I am not a U.S. citizen or permanent resident
  1. My work was performed in another county
  1. I could be claimed as a dependant on someone else’s tax return

 

Answers are as follows……

 

Answers

 A.  There is no choice for State Citizen, so the correct answer is 4. Other.  The form goes on to explain that you need paper work from the State as to why you need a social security number.  Your birth certificate is the paper work.  As usual, your birth certificate is proof of your citizenship and should always be included with any answer or application.

B.  Again no State Citizen choice.  A State Citizen is also a national or non citizen national of the United States of America.  However, when the USA is intended, they use U.S. or United States for the purpose of confusion.

  • So citizen of the United States in this case is the U.S. corporation.
  • A non citizen national or national of the United States means the republic United States of America. Of which a State Citizen is.

So the correct answer is 2. A noncitizen national of the United States.

C. Again, the Questionnaire for National Security Positions.  Form 86 is an attempt to confuse.  They combine U.S Citizen of the corporation with a national of the USA republic.  A State Citizen is a national by birth.  So the answer is 1. I am a U.S. citizen or national by birth, or U.S. territory/commonwealth. 

D. If you receive a CP 59 form or other letter from the IRS, then you send it back with a copy of your birth certificate and passport.  You tell them you are a State Citizen and to cease and desist.  If  you receive the CP 59 form, the correct answer is 8. I am not a U.S. citizen or permanent resident.  A State Citizen is not a U.S. citizen or a resident of the United States the Federal corporation.  A State Citizen is an inhabitant in the State in which they live.  The Federal area is a fictional area, not physical.

 

 

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    THE ABUNDANCE PARADIGM: WHY AI FORCES A RETHINKING OF MONEY ITSELF — PART 1

    By Ellen Brown on May 11, 2026

    A Universal Basic Income (UBI) has long been proposed as a way to cushion the blow of jobs lost to automation. Under that model, everyone receives a modest monthly payment – enough to cover basic needs and prevent extreme poverty. 

    But Elon Musk has gone further. On April 16, he posted on X:

    Universal HIGH INCOME via checks issued by the Federal government is the best way to deal with unemployment caused by AI.

    Rather than a subsistence stipend, Universal High Income (UHI) would be a level of income allowing ordinary people to live well in a world where machines do most of the work. Musk has also said that AI and robotics are the only things that can solve the massive U.S. debt crisis. 

    That sounds promising, but where will the government get the money to pay the UHI? Critics say any government that tried it would go bankrupt. There are also other concerns, which will be addressed in Part 2 of this article. Here we will look at the financial underpinnings: why UHI is even thinkable, why AI forces a reexamination of how money enters the economy, why the current system cannot scale to meet what is coming, and the implicit transition needed to meet that challenge.

    Why the Current Money System Cannot Scale

    The national debt of the U.S. government just topped $39 trillion. China’s is $18.7 trillion. Japan’s is $8.6 trillion. Those of the UK, France, Germany, Italy and Spain are each in the multi-trillion-dollar range. Collective global debt now stands at $353 trillion, 305% of the world’s annual economic output. So even if, hypothetically, everything produced in the world in a year were applied toward liquidating the debt, it still would not be enough to pay it all off. 

    In fact the debt can never be repaid, because of the way money currently enters the system. Nearly all of the money supply today is created by banks when they make loans. Banks do not lend their existing capital. The loan itself creates the money. The bank adds the loan amount to the asset side of its balance sheet and balances that sum with the same amount on the liability side. When the borrower withdraws or transfers the funds, either the bank takes them from its reserves in “vault cash” or the Federal Reserve debits the bank’s digital reserve account at the central bank. But the lending bank typically has funds coming into its reserve account at about the same rate as they are going out, so its reserves are continually replenished. Thus a very small reserve account can support a much larger money creation engine. For decades before the Fed discontinued the reserve requirement in 2020, it hovered at around 10%.

    The chief problem with this debt-based system is the interest, which the bank does not create in its original loan. For a typical long-term loan, interest can double the total tab or more. Where is the money to come from to pay this added liability? Across the system as a whole, it must either come from more borrowing or from existing funds. In the case of governments, that means issuing interest-bearing bonds or tapping taxes and other revenues. The interest on the debt compounds, meaning the government is paying interest on interest. This makes the debt increase exponentially, until it is mathematically unsustainable. Then bankruptcies occur, of banks or even whole governments. Booms turn into busts, and the cycle begins again.

    Today, interest on the federal debt is the second largest budget line item after Social Security, exceeding $1 trillion. Meanwhile, workers are losing jobs to AI/robotics, shrinking the income tax base. The system is clearly unsustainable.

    How to Raise Demand to Scale to the Upcoming Supply

    A Universal High Income would replenish the shrinking tax base by replacing the lost wages of unemployed workers. But where will the money come from to pay the UHI? The only sustainable solution is for the government to issue it interest-free. That does not mean through the Federal Reserve, which creates money in the same way banks do: it buys federal interest-bearing securities with accounting entries. The Fed collects the interest, which it is supposed to return to the Treasury after deducting its costs. But since 2008, its costs include paying interest on the reserves of its participating banks, which consumes its profits. (See my earlier article here.) 

    The only interest-free, debt-free solution that will actually increase the money supply sufficiently to match the projected productivity of AI/robotics is for the money to be issued directly by the Treasury.

    This is not a radical new idea. It is authorized in the U.S. Constitution, which provides in Article 1, Sec. 8, that “The Congress shall have Power To … coin Money [and] regulate the Value thereof .…” Abraham Lincoln used government-issued “Greenbacks” to avoid a crippling debt to British-backed bankers. Debt-free government-issued money was also the funding mechanism by which the American colonists succeeded in creating a thriving economy and liberating themselves from the oppressive yoke of the British Empire.

    In his 1729 pamphlet “A Modest Inquiry into the Nature and Necessity of a Paper-Currency,” Benjamin Franklin argued that a lack of currency was a tax on industrious farmers and producers, and that a reliable, locally issued paper currency was the “oil” for the gears of trade. The “Nature and Necessity” of this currency was to facilitate the movement of goods between neighbors. Franklin observed that the British strategy of keeping the colonies short of cash was a method of economic suppression. By forcing the colonies to use gold and silver, which were constantly drained back to London to pay for imports, the Crown kept the colonies in a state of permanent debt and low productivity. When the money supply matched the productive capacity of the people, universal prosperity resulted without inflation. 

    This logic evolved into the “American System of Political Economy” championed by Henry Carey, economic advisor to Abraham Lincoln. He wrote:

    Two systems are before the world… One looks to pauperism, ignorance, depopulation, and barbarism; the other in increasing wealth, comfort, intelligence, combination of action, and civilization. … One is the English system; the other we may be proud to call the American system, for it is the only one ever devised the tendency of which was that of elevating while equalizing the condition of man throughout the world.

    In the context of the 21st century, the “oil” that best lowers the friction of trade is debt-free government-issued money similar to Lincoln’s Greenbacks and colonial scrip. Rather than implementing a radical financial innovation, we would be returning to our roots.

    Inflation or Deflation?

    The chief objection to the colonies’ paper “scrip” was that they tended to over-print, so that “demand” (money) outstripped supply. Too much money chasing too few goods produced price inflation. But in the 21st century, we will soon have the opposite problem: too little money chasing too many goods. Machines don’t need food, clothing, shelter, transportation, medical treatment or other services. So who will buy those goods and services? 

    Money needs to be issued to human consumers, and not just to a few wealthy human consumers serving as debt brokers thriving on interest. To create sufficient demand for the voluminous output of AI/robotics, it needs to go to the whole national population, evenly distributed. Not only can UHI work in that sort of abundant supply without producing price inflation; it is actually essential to prevent deflation.

    In a conversation on X, Musk wrote:

    In a normal economy, issuing more money simply increases the dollar price of the existing output of goods & services, meaning people do NOT get more stuff. If AI/robotics massively increase goods & services output, then you actually MUST issue dollars to people or there will be massive disinflation. 

    As paraphrased on Yahoo Finance (reposted from Benzinga), Musk wrote that handing out more dollars becomes a problem only when the economy’s supply of goods and services fails to surge alongside the money supply. His claim is that AI and robotics could lift production so sharply that the bigger risk would be falling prices, not rising ones.

    But aren’t falling prices a good thing? In this case, no. Prices would be falling due to a lack of demand, meaning producers can’t find customers for their products. They wind up laying off workers and eventually going bankrupt. When spread across the whole economy, the result is a deflationary spiral: prices fall, businesses lose revenue, and the economy contracts, not because production is inadequate but because purchasing power is insufficient. The result is recession or depression. In the Great Depression of the 1930s, food was rotting in the fields while people were starving, because they were out of work and had no money to spend. 

    Job cuts from AI are already happening. According to the same Benzinga article:

    Evidence of near-term strain is showing up in corporate announcements: employers disclosed more than 27,000 job cuts linked to AI in the first quarter of 2026, according to Challenger, Gray & Christmas. The outplacement firm said that figure was up 40% from the same period a year earlier. 

    Robert Reich reports that wages are around two-thirds of the typical corporation’s total cost, and that in the first four months of 2026, big U.S. corporations cut over 128,000 jobs. 

    How Soon Will All This Happen?

    Another Benzinga article, reposted on Yahoo Finance on March 16, detailed Musk’s projected time frame:

    Speaking remotely to the Abundance Summit last week, Musk told XPRIZE founder Peter Diamandis that the global economy is on the verge of an explosion so massive it defies historical precedent.

    “I’d say the economy is 10 times its current size in 10 years,” Musk said, before quickly clarifying that the growth could be even more explosive. “Greater than,” he added, framing the projected shift in economic output as a “fairly comfortable prediction.” …

    Ray Kurzweil, author of The Singularity Is Near, sees AI reaching Artificial General Intelligence (human-level intelligence across virtually all domains) by 2029, and full transformative abundance by 2045.

    Other experts question these time projections, but a radical transformation of traditional manufacturing and trade is likely to happen sometime in the reasonably near future. The question is, will the money system transition soon enough to rescue all the laid-off workers from homelessness and famine?

    The Sovereign Wealth Fund Alternative

    There is another model for distributing the gains of automation, one that can be phased in gradually as the AI workforce expands. It comes from Sam Altman, CEO of OpenAI. In an ironic twist, Altman and Musk, who jointly founded OpenAI in 2015, are now locked in a high-profile legal battle over whether Altman diverted Musk’s $44 million investment to transform what was conceived as a nonprofit “for the benefit of humanity” into a highly lucrative for-profit enterprise.

    That dispute aside, Altman’s alternative model for sharing AI-generated wealth is a national sovereign wealth fund seeded by the profits of AI and robotics. His proposed American Equity Fund would take public stakes in the companies and technologies driving automation, capture a portion of the resulting productivity gains, and distribute them as universal dividends. The Fund would not replace a Universal High Income but would complement it.

    This approach has several advantages. It ties payments directly to real output, scales automatically with productivity, and can be introduced gradually, avoiding the shock of issuing large payments before the supply side has fully expanded. It would resemble the Alaska Permanent Fund, which distributes oil revenues to residents, except that here the resource would be the most powerful general-purpose technology since electricity.

    Conclusion: A New Monetary Logic for a New Productive Era

    For centuries, money has been issued as a claim against the future productivity of human labor, repaid from the income that labor generates. The logic of this debt-based system collapses when machines become the primary producers of goods and services. Then the limiting factor becomes purchasing power — the ability of human beings to access the abundance their own technologies create. That requires a monetary architecture that expands with output rather than debt, and distributes income not through wages alone but through mechanisms tied to the productive capacity of the whole system.

    Universal High Income and a sovereign wealth fund are two ways of doing that. One ensures a stable floor of demand; the other ensures that the public shares in the gains of automation. Both would be grounded in real production. But for the public to have access to those gains, the money supply needs to expand in proportion to the expanding pool of goods and services. This can be done by restoring the innovation our forefathers baked into the Constitution: debt-free money issued by the government itself.

    How to fund a UHI without triggering inflation or driving the government into bankruptcy is the first objection critics raise, but there are others. They argue that people would stop working or stop learning, that society would collapse into idleness or chaos, that life would lose meaning without jobs, that the government would have the power to control how people spend their money.  Will a UHI ring in the promised utopia or lock us into a state-controlled digital prison? Part 2 of this article will address those concerns. 

    _______________

    This article was first posted as an original to ScheerPost.com. Ellen Brown is an attorney, founder of the Public Banking Institute, and author of thirteen books including Web of DebtThe Public Bank Solution, and Banking on the People: Democratizing Money in the Digital Age. Her 400+ blog articles are posted at EllenBrown.com.tom of Form

     

     

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    Posted By: The_Fox [Send E-Mail]
    Date: Thursday, 1-Dec-2022 05:31:08
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