Category Archives: Politics

Ron Paul – Stimulus for Who?

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This week the House is expected to pass an $825 billion economic stimulus package.  In reality, this bill is just an escalation of a government-created economic mess.   As before, a sense of urgency and impending doom is being used to extract mountains of money from Congress with minimal debate.  So much for change.  This is déjà vu.  We are again being promised that its passage will help employment, help homeowners, help the environment, etc.  These promises are worthless.  This time around especially, Congress should know better than to pass anything of this magnitude without first reading the fine print.  There a many red flags that I have found in this bill.

At least $4 billion is allocated to expanding the police state and the war on drugs through Byrne grants, which even the Bush administration opposed, and the COPS program, both of which are corrupt and largely ineffective programs. 

To help Big Brother keep a better eye on us and our children, $20 billion would go towards health information technology, which would create a national system of electronic medical records without adequate privacy protection.  These records would instead be subject to the misnamed federal “medical privacy” rule, which allows government and state-favored special interests to see medical records at will.  An additional $250 million is allocated for states to nationalize individual student data, expanding Federal control of education and eroding privacy.

 $79 billion bails out states that haphazardly expanded their budgets during the bubble years, but refuse to retrench and cut back, as their taxpayers have had to, during recession years.   

$200 million expands Americorps.  $100 million goes to “faith-and-community” based organizations for social services, which will further insinuate the government into charity and community service.  Private charities are much more efficient and effective because they are directly accountable to donors, while public programs tend to get rewarded for failure. With its money, the Federal Government brings its incompetence and its whims, while creating foolish dependence.  This is sad to see.

Of course the bill is rife with central planning projects.  $4 billion for job training, much of which will be used to direct workers into “green jobs”.  $200 million to “encourage” electric cars, $2 billion to support US manufacturers of advanced batteries and battery systems, which is yet another function of government I can’t find in the Constitution. Not to mention $500 million for energy efficient manufacturing demonstration projects, $70 million for a Technology Innovation Program for “research in potentially revolutionary technologies” in which government, not supply and demand, will pick winners and losers.  $746 million for afterschool snacks, $6.75 billion for the Department of Commerce, including $1 billion for a census. 

This bill delivers an additional debt burden of $6,700 to every American man, woman and child.

There is a lot of stimulus and growth in this bill – that is, of government.  Nothing in this bill stimulates the freedom and prosperity of the American people.  Politician-directed spending is never as successful as market-driven investment.  Instead of passing this bill, Congress should get out of the way by cutting taxes, cutting spending, and reining in the reckless monetary policy of the Federal Reserve.

Ron Paul

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Ron Paul – Strengthening or Weakening the Economy?

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The economic situation continues to deteriorate this week as past and future bailouts were discussed on Capitol Hill.  The debate was over the accountability of already disbursed TARP money, and on whether or not to release remaining funds.   Banks that had already been bailed out before are looking for more money to fill the black holes that are their balance sheets, warning that they are simply too big to fail.  However, whatever ‘devastating’ consequences these banks are dreaming up and pushing on Capitol Hill regarding their own collapse will be nothing compared to the collapse of our currency if we keep debasing it through these foolish bailouts.  It should be that they are too big to bailout.  The world will not come to an end without this or that bank.  The most troubling thing to me is this rhetoric that only government can save the economy, and must act.  This is so counter-productive.

We must ask ourselves what strengthens this country, and what weakens it.

Government is a monumental drag on this economy.  Government at all levels currently absorbs about 35-40 percent of GDP, which is still not enough for its voracious appetite. While productivity is already overtaxed, the government routinely spends more than it takes in and makes up for the shortfall by constantly borrowing or debasing our dollars through inflation.  It pains me to think of all the opportunities for productive economic growth we have given up simply because our government is super-sized instead of Constitution-sized.  There are just a few constitutionally sanctioned activities for government to engage in, but it is so overstretched with unconstitutional encroachments that what it is legitimately supposed to do, it does very badly.  And yet we are to believe the solution to our problems is to make government bigger.  On the contrary, government makes our problems bigger.  The central bank’s meddling with monetary policy led to overheated lending, and now massive defaults.  The government used manipulative tax policy to distort the housing market which has had many unintended consequences, and here we are.  Government is quick to enact and slow to correct bad policy.  Yet in spite of government’s failures, it flourishes and grows, thanks to the continual bailouts from the unwitting taxpayer. 

Big government has been tried and has failed miserably.  What we need now is small government, and freedom.  We need the freedom to pull ourselves up by our own bootstraps again, as we traditionally do in this country.  But try to start a business or charity today, and you will understand how little economic freedom we really have left.  Freedom, not government, made this the land of opportunity.  Freedom laid the foundation that catapulted us to becoming the strongest economic power in the world.  The American people are strong and capable.  We can pull ourselves out of this mess.  All we need is for the nanny-state to get out of the way and allow us to do it.  Freedom is our strength, government is our weakness.  Only by recognizing this and unleashing our strengths will we solve the problems we face today.

Ron Paul

Brought to you by Alan’s Money Blog:
http://alansmoneyblog.com

Ron Paul – The American Power Structure Video (1988)

Revealing interview from the August, 1988 broadcast of Frank Morrow’s “Alternative Views” found at archive.org. It cements Dr. Paul’s place as America’s leading economic prophet crying in the wilderness and a voice we ignore at our own loss. At the time of the interview, Dr. Paul was the Libertarian candidate for president.

From the original description:

“Former four-term Congressman Ron Paul describes the American power structure. As a member of the House Banking and Currency Committee, Paul was in a unique position to see the inner workings of economic power and control of the country, and how this power translates into political power. Paul describes how, through the control of the Federal Reserve and the banking system, the American power elite is basically out of reach of the democratic system.”

There’s a lot of information contained. Dr. Paul rightly states that many politicians in DC aren’t informed about the nature of banking or economics, a condition that serves the interests of the central banking establishment. He also rightly states that the Federal Reserve, due to its secrecy and power, is nothing less than evil.

Enjoy the video! (below)

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Brought to you by Alan’s Money Blog:
http://alansmoneyblog.com

Ron Paul – Stimulating Our Way to Rock Bottom

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With attention turning to the next big economic stimulus package, questions are still swirling about our economic troubles. How did we get here? How do we get out? As usual, Washington has all the wrong answers. According to many politicians, we got here by not spending enough, not consuming enough, and not regulating enough. Now government, like some mythical white knight, is going to ride in to save the day by blanketing the economy with dollars, hiring an army of new bureaucrats, creating make-work jobs, and sending everyone some form of a bailout check. The debate seems to focus on whether this will cost enough to save the economy, or if this is just a “down payment” with much more government spending to come. Talk like that would be comical, if the results weren’t going to be so tragic.

The results will be worsening economic woes until we learn our lesson. But instead Congress is behaving like drug addicts who must hit rock bottom before they are ready to face reality. They are playing foolish games with the economy now because they are thinking only of political expedience. This talk of job creation is a perfect example.

Contrary to the belief of many, the goal of the economy is not job creation. Jobs can be a sign of a healthy economy, as a high energy level can be a sign of a healthy body. But just as unhealthy substances can artificially give the addict that burst of energy that has nothing to do with health, artificially created jobs just exacerbate our problems. The goal of a healthy economy is productivity. Jobs are a positive outcome of that. A “job” could be to dig a hole one day, and fill it back up the next, or perhaps the equivalent at a desk. This does no one any good. But the value in that paycheck ultimately has to come from taxing someone productive. Some think this round-robin type of economic model is supposed to get us somewhere.

Politicians and bureaucrats have already done their fair share to ensure that jobs in the private sector are prohibitively complicated and expensive to create. They are now shocked that the economy is shedding jobs, and want to simply create hundreds of thousands of jobs to make up for the job losses, through another so-called economic stimulus package. The private sector must be permitted to do that, but instead they are massively burdened with taxes and webs of red tape and regulation. Washington’s bandaids will only prolong this agony. The Austrian school of economics teaches that only a free market economy, unencumbered by onerous government controls, creates long-term prosperity. Politicians, however, tend to be notoriously short-sighted.

I am left with these questions – who is going to be left standing, to tax in the private sector, to pay for all these public sector make-work jobs? Is Washington really to be considered some sort of savior for creating unproductive jobs in place of the productive jobs they eliminated?

We are at an economic dead-end and those in power are in denial. The truth is our economic problems are due to loose monetary policy, central economic planning, and the parasitic expenses of government. Unless we assess these problems honestly, we unfortunately have a long way to go until, like the junkie, we hit rock bottom.

New!  Listen to Texas Straight Talk!

Ron Paul

Brought to you by Alan’s Money Blog
http://alansmoneyblog.com

Ron Paul – Transition and Hope

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As another year draws to a close, there are some important transitions ahead of us.  Not just transitions to a new administration, but also economically, politically and culturally.

Many hoped that the changes would signify overwhelming positive steps for our country, and that we would enter a new era, as promised during the campaign.  I would like for this to be true, but based on the continuity so far, I would not be surprised to see America stay on the same course of failed monetary and economic policies.  The course has been set for several decades, and in reality there is little the new administration could do to fix things without actually making them worse.  But I expect them to try.  The only real solutions involve allowing the market to liquidate the debt and malinvestment.  The political reality is that this is not going to happen.

Through the coming months and years, our nation will find itself at many crossroads, as all manner of socialist, corporatist, protectionist and nationalist initiatives will be thrown at the economy to see if anything will reflate it.  Some of these so-called fixes will be enacted amidst much outcry, as with the $700 billion TARP bailout, which the public was right to oppose.  About half of that money is gone without a trace, with no accountability, and the economy is no better off for it.  Others, such as the proposed new $800 billion plus economic stimulus the new administration is already clamoring for, might have limited public support, as many will find the prospect of receiving a government check a little too tempting to object to.  After all, Wall Street got a bailout.  What about the little guy?  Everything will be attempted by government in the short run to remedy the worsening situation – everything, that is, but freedom.  Therefore everything attempted will fail.  Unfortunately, government will continue to consolidate and abuse power at an accelerated pace.  Government will get bigger, in the short term, and as monetary policy goes from irresponsible to absurd, I have every expectation that we will soon shift from some prices falling to an inflationary nightmare.

But there is hope.  As all these attempts fail, more people will demand freedom, and see that it is the only way.  Government can only get so big before the country goes broke. 

It is regrettable that we keep forgetting what history has shown over and over to be true, because truly, it is a hard and destructive lesson to keep learning.  Perhaps it is just something that every generation has to learn for itself.  The political and cultural changes that come from these economic transitions will be key to the direction and quality of life for future generations.  But I am hopeful because of the strength of the American people and the increased number of voices recognizing that liberty really is the only way to peace and prosperity.

Brought to you by Alan’s Money Blog:
http://alansmoneyblog.com

Ron Paul – Government and Fraud

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Billions of dollars were recently lost in the collapse of Bernie Madoff’s self-described Ponzi scheme, in which too-good-to-be-true returns on investments were not really returns at all, but the funds of defrauded new investors.  The pyramid scheme collapsed dramatically when too many clients called in their accounts, and not enough new victims could be found to support these withdrawals.  Bernie Madoff was running a blatant fraud operation.  Fraud is already illegal, and he will be facing criminal consequences, which is as it should be, and should act as an appropriate deterrent to potential future criminals.  But it seems every time someone breaks the law, politicians and pundits decide we need more laws, even though lack of laws was not the problem. 

The government itself runs a fraud much bigger than Madoff’s.  Our Social Security system is the very definition of a Ponzi, or pyramid scheme.  If the government truly had an interest in protecting people’s savings, they would allow people to opt out of Social Security altogether.  We would cut wasteful spending, such as our overseas empire, to honor current obligations to seniors, and eventually phase the program out.  Instead, as with Enron and Sarbanes Oxley, I expect new, unrelated legislation to be proposed that further damages freedom in the name of protecting us, amidst loud proclamations that they have made the world safe.

Merely passing a law does not fix any problems, just as throwing paper at a recession does not stop it.  How can a government so complicit in mandatory public fraud effectively pre-empt private fraud?   I see no reason to believe that any new law, or regulatory agency will solve anything.  But I do see liberty slipping away every time Congress decides to “do something”.  We already have an oversight agency, the SEC, which did a poor job overseeing and preventing this, but does a great job hamstringing honest, productive businesses and driving them overseas. 

Total trust in government solutions only creates moral hazard, and amplifies risky behavior.  Trust in government got us here.  We trusted government to eliminate risk, but it just made risk more creative and dangerous.  We trusted the Federal Reserve, a supra-governmental cabal of private banks, to know better than the free market what interest rates should be, and how to stabilize the business cycle, but like a spinning top that loses its balance, it has instead spun the business cycle and the economy wildly out of control. 

No governmental activity can negate market forces or nullify the cardinal rule of caveat emptor.  Government can however, use our fears against us and promise unrealistic outcomes as a means to consolidate power and erode our liberties.  Liberty comes with risk.  This is a fact of life.  But life without liberty is not much of a life at all.

The only way the American people will get through these difficult times is through our own resilience and ingenuity.  At best, the government is irrelevant in finding prosperity again.  At worst, government can present a massive obstacle for the economy to overcome.   If we do not wise up and rein government back in to its Constitutional limitations, bloated government could be a cumbersome unnecessary weight the economy will continually have to support to stay afloat

Brought to you by Alan’s Money Blog:
http://alansmoneyblog.com