The Franklin Prophecy is a forgery. It was first published in February 1934 in William Dudley Pelley’s publication, Liberation. It refers to an anti-Semitic speech which Benjamin Franklin is alleged to have made at the Constitutional Convention of 1787, written down by Charles Pinckney of South Carolina and preserved in his journal. In a letter to John Quincy Adams dated 30 December 1818, Pinckney said he had kept a journal of the proceedings at the Convention. Pelley claimed that Pinckney published the Journal "for private distribution among his friends" under the title Chit-Chat Around the Table During Intermissions.
Use by American fascist groups
Following its publication in Liberation, the "Prophecy" was widely circulated throughout the United States. In the 1930s it was disseminated by chain letters, and printed copies of the speech were placed in trains, buses, railway stations and similar public places. It appeared in the propaganda press and broadcasts of Nazi Germany and fascist Italy, and a version was included in the 1935 edition of Handbuch der Judenfrage ("Handbook On The Jewish Question"), a political publication by Theodor Fritsch, first written several decades earlier, that went on to become a Nazi "bible".
In the United States, anti-Semitic groups such as Chicago’s We The Mothers Mobilize For America used the Prophecy as their raison d'etre. Gerald L. K. Smith and other anti-Semitic propagandists argued strongly in favor of its authenticity, and it was printed in Women’s Voice (31 July 1952) and the Political Reporter (July 1953). In May 1954 it was published in The Point, put out by Roman Catholic Father Leonard Feeney of St Benedict’s, Cambridge, Massachusetts.
Historians have overwhelmingly concluded that the Prophecy is fraudulent. Charles A. Beard wrote: "I cannot find a single original source that gives the slightest justification for believing that the Prophecy is anything more than a barefaced forgery. Not a word have I discovered in Franklin’s letters and papers expressing any such sentiments against the Jews as are ascribed to him by the Nazis — American and German. His well-known liberality in matters of religious opinion would, in fact, have precluded the kind of utterances put in his mouth by this palpable forgery." Beard also pointed out: "The phraseology of the alleged Prophecy is not that of the 18th century; nor is the language that of Franklin. It contains certain words that belong to contemporary Nazi [ideology] rather than America of Franklin’s period. For example, the word homeland was not employed by Jews in Franklin’s time. It was created in connection with the Palestine mandate."
J. Henry Smythe, Jr., concluded that it was a "libel of the Jewish race, unjust both to Jews and to the name and fame of Benjamin Franklin. I have investigated this calumny and find no historical basis."
In fact, Benjamin Franklin was friendly towards the Jews even contributing towards the building of Mikveh Israel, the first permanent synagogue in America.
Text of the "Prophecy"
There is a great danger for the United State of America. This great danger is the Jew. Gentlemen, in every land the Jews have settled, they have depressed the moral level and lowered the degree of commercial honesty. They have remained apart and unassimilated; oppressed, they attempt to strangle the nation financially, as in the case of Portugal and Spain.
For more than seventeen hundred years they have lamented their sorrowful fate — namely, that they have been driven out of their mother land; but, gentlemen, if the civilized world today should give them back Palestine and their property, they would immediately find pressing reason for not returning there. Why? Because they are vampires and vampires cannot live on other vampires - they cannot live among themselves. They must live among Christians and others who do not belong to their race.
If they are not expelled from the United States by the Constitution within less than one hundred years, they will stream into this country in such numbers that they will rule and destroy us and change our form of Government for which we Americans shed our blood and sacrificed our life, property and personal freedom. If the Jews are not excluded within two hundred years, our children will be working in the field to feed Jews while they remain in the counting houses, gleefully rubbing their hands.
I warn you, gentlemen, if you do not exclude the Jews forever, your children and your children’s children will curse you in their graves. Their ideas are not those of Americans, even when they lived among us for ten generations. The leopard cannot change his spots. The Jews are a danger to this land, and if they are allowed to enter, they will imperil our institutions. They should be excluded by the Constitution.
- http://www.mikvehisrael.org/History/ Mikveh Israel: History