The Fed? Ron Paul Is Not a Fan By SEWELL CHAN |
December 11, 2010
Ben S. Bernanke, the chairman of the Federal Reserve, has
been attacked for failing to foresee the financial crisis,
for bailing out Wall Street, and, most recently, for injecting
an additional $600 billion into the banking system to give
the slow recovery a boost.
But
Mr. Bernanke will face even more scrutiny in the months
to come. On Thursday, House Republican leaders announced
that Representative Ron Paul of Texas, the outspoken Republican
libertarian who ran for president in 2008, will become the
chairman of the subcommittee that oversees the Fed. His
position on the central bank is captured in the title of
his 2009 book, “End the Fed” (Grand Central
Publishing).
Here’s some of what he wrote:
The Beginning of the End
“The day the Fed came into being in 1913 may have
been the beginning of the end, but the powers it obtained
and the mischief it caused took a long time to become a
serious issue and a concern for average Americans.”
The Gold Standard
“Whenever I talk of a gold standard, there are always
people ready to accuse me of having some obsession or fixation.
Fetish is a word thrown around. In fact, I’m only
observing reality: the idea of sound money in most of human
history has been bound up with gold money.”
A Full-Time Counterfeiting Operation
On Mr. Bernanke: “There is something fishy about
the head of the world’s most powerful government bureaucracy,
one that is involved in a full-time counterfeiting operation
to sustain monopolistic financial cartels, and the world’s
most powerful central planner, who sets the price of money
worldwide, proclaiming the glories of capitalism.”
New Money Out of Thin Air
“Only the Federal Reserve can inflate the currency,
creating new money and credit out of thin air, in secrecy,
without oversight or supervision. Inflation facilitates
deficits, needless wars and excessive welfare spending.”
Fed Chairmen He Has Known
“Being in Congress in the late 1970s and early 1980s
and serving on the House Banking Committee, I met and got
to question several Federal Reserve chairmen: Arthur Burns,
G. William Miller and Paul Volcker. Of the three, I had
the most interaction with Volcker. He was more personable
and smarter than the others, including the more recent board
chairmen Alan Greenspan and Ben Bernanke.”
Low Interest Rates
“Artificially low interest rates are achieved by
inflating the money supply, and they penalize the thrifty
and cheat those who save. They promote consumption and borrowing
over savings and investing. Manipulating interest rates
is an immoral act. It’s economically destructive.”
The Bailouts
“Today, there is no principled opposition to the
corporate bailouts and the Fed’s trillions of dollars
of new credit and the takeover of insurance, mortgages,
medical care, banks and the auto industry. The arguments
have only been over amounts, financial vehicles, and which
political group gets to wield the economic power. If there
is no moral argument against the economic takeover of America,
there will be no resistance to the dictator who rules over
our lives with an iron fist.”
The Obama Legacy
“For the same reason a disease cannot be cured by
more of the germ that caused it, the inflation and debt
accumulation of the Obama years will not inflate our way
out of it. This depression will likely last and last.”
This article has been revised to reflect the following
correction:
Correction: December 19, 2010:
An article last Sunday about Representative Ron Paul, a
Texas Republican who is in line to become head of the subcommittee
that oversees the Federal Reserve, transposed two of the
digits in one of the decades in which he served on the House
Banking Committee. It was during the early 1980s, not the
1908s.