The American Dream is a 30-minute animated film from 2010, written and directed by Tad Lumpkin and Harold Uhl, that tells the history of American money as a story of ordinary people kept in debt by banks and the Federal Reserve. It is satirical, fast and often funny, with voice work by D.C. Douglas and Jess Harnell, and it has been widely shared online as an easy introduction to how money works.
The film is worth watching, and worth checking. Some of its core points are openly confirmed by central banks today, while its biggest claim, that the system is a deliberate scheme to enslave the public, is an argument rather than an established fact. Below you will find the film itself, a plain explanation of how money is actually created, what the Federal Reserve is and is not, and where the film's case holds up or overreaches.
Captions are available in several languages, including English, Spanish, Greek, Portuguese, Czech, Hungarian, Romanian, Bulgarian and Finnish; switch them on with the CC button in the player.
What the film argues
The film starts from the American Dream of a home, a job and security, and keeps asking why that dream seems to move further away. Its answer is the money system. The film walks through the history of banking up to modern central banks, then argues that private banks create money as debt, that interest on that debt can never be fully repaid without more borrowing, and that the Federal Reserve, created in 1913, protects bankers rather than citizens.
It links this to the housing boom and crash of the 2000s, to inflation that eats savings, and to bailouts that rescued financial firms. It also quotes earlier American leaders who were suspicious of central banking, presenting today's system as the outcome of a long fight that the public lost. The tone is that of a pamphlet with cartoons: clear, angry and designed to make you look further.
How money is actually created
The most surprising claim in the film, that banks create money when they lend, is true, and you do not need a conspiracy to explain it. In March 2014 the Bank of England published a widely read article, "Money creation in the modern economy", which says plainly that most money in the modern economy is created by commercial banks making loans. When a bank approves a mortgage, it does not hand over someone else's savings; it credits the borrower's account with a new deposit.
The same article corrects two textbook ideas. Banks are not simple middlemen that lend out existing deposits, and the old "money multiplier", in which banks mechanically multiply reserves from the central bank, does not describe how things work today. What limits money creation is mainly the central bank's interest-rate policy, along with banks' own need to stay profitable and solvent, and regulation. In unusual times central banks also buy assets on a large scale, known as quantitative easing.
So the film is right that money is largely bank-created debt. Where it goes further than the evidence is in the claim that this design is hidden or exists to trap people. Central banks publish detailed explanations, and economists argue openly about whether the system is fair and stable.
What the Federal Reserve is, and is not
The Federal Reserve was set up by the Federal Reserve Act on 23 December 1913, after a series of bank panics, especially the Panic of 1907. It has a Board of Governors in Washington, whose seven members are appointed by the President and confirmed by the Senate for 14-year terms, and twelve regional Reserve Banks. Monetary policy is set by the Federal Open Market Committee.
A common claim, repeated in many films of this kind, is that the Fed is simply a private bank owned by bankers. The real picture is more mixed. Member banks must buy stock in their regional Reserve Bank, but that stock cannot be sold or traded, does not give control, and pays a capped dividend. After costs and dividends, the system's profits go to the US Treasury; in 2015, for example, it sent about $97.7 billion. The Government Accountability Office can audit parts of its work, although most monetary-policy decisions are excluded, and an outside auditor reviews its accounts.
Its legal mandate from Congress is maximum employment and stable prices, which it interprets as inflation of around 2 percent a year. Whether it meets that mandate well is a fair debate. Milton Friedman blamed the Fed for deepening the Great Depression, and politicians such as Ron Paul have called for it to be abolished. Those are serious critiques, made in public, by people who disagree about the remedy.
Where the film has a point, and where it overreaches
The film is strongest on everyday effects. Debt really does make up most of the money supply, house prices did rise and collapse spectacularly before 2008, and the Fed's emergency actions in the crisis, such as an $85 billion loan to the insurer AIG and large purchases of mortgage-backed securities, did protect financial firms. Critics across the political spectrum argue that such rescues encourage reckless risk-taking.
It is weakest when it turns complex trade-offs into a single villain. Inflation, housing bubbles and inequality have many causes, including tax policy, planning rules, global trade and household borrowing habits. Countries with very different central banks have had similar booms and busts. And the claim that this is the same "scam" in nearly every country ignores the large differences between monetary systems.
A practical way to watch it is as an opening argument. Note each claim, then check it against a neutral source such as a central bank's own explainers, an economics textbook or a reputable news archive. The habit of asking how money works, which the film encourages, is valuable whatever conclusion you reach.
A protester holds a hand-lettered sign quoting the comedian George Carlin, in a street photograph watermarked RNAPhoto 2011, the year of the Occupy protests against economic inequality. The sign shows how far Carlin's joke had travelled beyond comedy clubs into political protest.
The Carlin line and the hunger quote
The film's title gets a famous echo from George Carlin, whose punchline appears on that sign:
"It's called the American Dream because you have to be asleep to believe it." (George Carlin)
Wikiquote lists the line among material from his 1990 album Parental Advisory: Explicit Lyrics. Like most Carlin jokes, it is a provocation rather than a policy argument, and it works because it puts into words a frustration many people share.
A remark often shared alongside the film comes from the actor Jeff Bridges, speaking about child hunger in the United States, ending with the thought that if another country did this to American children, "we'd be at war." Bridges has campaigned on the issue for decades: he founded the End Hunger Network in the early 1980s and became the public face of the No Kid Hungry campaign run by the charity Share Our Strength in 2010. His figures were close to official estimates of the time; in 2011 about 16.7 million American children lived in households that the US Department of Agriculture classed as food insecure, meaning they could not always be sure of enough food.
The second video, and a note on self-government
The film is often paired with a second video called "The Story of Your Enslavement", a short history of human servitude produced by Freedomain Radio, the podcast and channel Stefan Molyneux started in 2004. That video is no longer available.
(The video originally embedded here is no longer available on YouTube.)
YouTube removed Molyneux's channel on 29 June 2020 for breaking its hate-speech rules. Before then his work had moved from libertarian philosophy toward views that the Southern Poverty Law Center and many journalists describe as racist and far-right, a description he rejects. Readers who come across his older videos should keep that context in mind.
The idea people usually draw from it is an old one: that the best kind of government is self-government, and that freedom starts with understanding why you think and act as you do, rather than simply following or rejecting others. You do not need any particular channel for that. Learning how money, credit and public institutions really work, from sources that show their evidence, is one of the most useful forms of self-reliance there is.
Sources: Bank of England: Money creation in the modern economy (2014); Wikipedia: Federal Reserve; FilmAffinity: The American Dream (2010); D.C. Douglas: The American Dream; Wikiquote: George Carlin; NBC News: Jeff Bridges and childhood hunger; Wikipedia: Food security in the United States; Wikipedia: Stefan Molyneux.
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brilliant
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