austrian economics
Ron Paul’s Texas Straight Talk: The Fed Twists, The Market Shouts
Ron Paul’s Texas Straight Talk 10/3/11: The Fed Twists, The Market Shouts.
Last week the Federal Reserve began the second incarnation of “Operation Twist”, an attempt to drive down interest rates by purchasing long-term Treasury debt and selling short-term debt. This is just the latest instance of the central bank desperately flailing around doing something merely for the sake of doing something. Fed officials still do not understand– or admit– that the Fed itself caused the financial crisis by driving interest rates too low and relentlessly expanding the money supply. Thus, this latest action will just exacerbate the problem.
Ron Paul’s Texas Straight Talk: Time to De-Recognize the United Nations
Ron Paul’s Texas Straight Talk 9/26/11: Time to De-Recognize the United Nations
Ron Paul’s Texas Straight Talk: Foreign Occupation Leads to Terrorism
Ron Paul’s Texas Straight Talk 9/12/11: Foreign Occupation Leads to Terrorism
Ron Paul’s Texas Straight Talk: End FEMA; It’s the Compassionate Thing to Do!
Ron Paul’s Texas Straight Talk 9/5/11: End FEMA; It’s the Compassionate Thing to Do!
Ron Paul’s Texas Straight Talk: Liberty is More Important Than the Illusion of Safety
Ron Paul’s Texas Straight Talk 8/22/11: Liberty is More Important Than the Illusion of Safety
Ron Paul’s Texas Straight Talk: S&P States the Obvious
Ron Paul’s Texas Straight Talk 8/15/11: S&P States the Obvious
S&P States the Obvious
by Ron Paul
Politicians did not get much time to pat themselves on the back for supposedly rescuing the economy with the debt limit deal last week. The ink was barely dry when Standard & Poor’s downgraded the US debt ratings anyway, roiling world financial markets. Anyone who has taken an honest look at the government’s fiscal situation, taken into account how Washington works and the direction it is going would have a very difficult time arguing with S&P’s decision, although a strong case can be made that this was too incremental a downgrade and that it took far too long for S&P to admit the obvious.
Nonetheless, the administration nitpicked over a $2 trillion “mistake”. S&P rejoined with the fact that $2 trillion here or there hardly makes a difference in the time frame under discussion. That, if nothing else, should tell you the magnitude of the problem. $2 trillion has become a drop in the bucket.
S&P cited Congress’s inability to act like grownups and make necessary, meaningful cuts, which is true. I must take issue however, with their suggestion that tax increases are part of the answer. Taking capital out of the private sector, where it can create real value in the form of new jobs and products, and instead giving it to Washington to waste and squander is not the solution. Tax increases may seem penny-wise to some, but in reality they would be very pound-foolish. The government currently takes in $2.2 trillion in taxes per year, which is far too much already. It spends $3.7 trillion, which is ridiculous and criminal. The problem is runaway government spending, not the American people having too much money.
And yet we can’t even have a serious discussion about bringing our troops home and ending our expensive occupations around the world — things the president used to claim to favor!
Even without this downgrade, major investors are waking up to what lies down the road for the United States in fiscal terms. China is showing more signs of losing its taste for our debt. Others are following suit. What we are about to see is the end of the dollar as the reserve currency of the world. When that happens, we will no longer be in a position to have pretend debates about things we probably should spend a little bit less on – we will be forced to implement serious spending cuts as our sources of credit dry up. Of course, we can try to postpone the day of reckoning by printing more money but the resulting “inflation tax” will be far worse than a reduction in government benefits.
Hyperinflation devastates the middle class. After Weimar Germany hyper-inflated their currency in the 1920s, an entire life savings couldn’t buy a postage stamp. The bank wouldn’t even send customers a check for all the money they had saved their whole lives. It wasn’t worth the paper it was printed on or the stamp to send it. This is what is meant when it is said that the middle class gets wiped out. The pieces for this to happen here are all falling into place, and have been since 1971. The only way to avoid that sort of chaos now is for Congress to immediately reduce federal spending and take the Constitution seriously again. The welfare/warfare state will end either way, but winding it down responsibly is a far better way to do it.
Ron Paul’s Texas Straight Talk: Say No to the Dangerous Super Congress
Ron Paul’s Texas Straight Talk 8/8/11: Say No to the Dangerous Super Congress
Ron Paul’s Texas Straight Talk: A Commonsense Approach to the Debt Ceiling Debate
by Ron Paul | Texas Straight Talk
August 1, 2011
One might think that the recent drama over the debt ceiling involved one side wanting to increase or maintain spending with the other side wanting to drastically cut spending, but that is far from the truth. In spite of the rhetoric being thrown around, the real debate is over how much government spending will increase. No plan under serious consideration cuts spending in the way you and I think about it. Instead, the cuts being discussed are illusory and are not cuts from current amounts being spent, but cuts in prospective spending increases. This is akin to a family saving $100,000 in expenses by deciding not to buy a Lamborghini and instead getting a fully loaded Mercedes when really their budget dictates that they need to stick with their perfectly serviceable Honda.
But this is the type of math Washington uses to mask the incriminating truth about the unrepentant plundering of the American people. The truth is that frightening rhetoric about default and full faith in the credit of the United States being carelessly thrown around to ram through a bigger budget than ever in spite of stagnant revenues. If your family’s income did not change year over year, would it be wise financial management to accelerate spending so you would feel richer? That is what our government is doing, with one side merely suggesting a different list of purchases than the other.
In reality, bringing our fiscal house into order is not that complicated or excruciatingly painful at all. If we simply kept spending at current levels, by their definition of cuts that would save nearly $400 billion in the next few years, versus the $25 billion the Budget Control Act claims to cut. It would only take us five years to cut $1 trillion in Washington math just by holding the line on spending. That is hardly austere or catastrophic.
A balanced budget is similarly simple and within reach if Washington had just a tiny amount of fiscal common sense. Our revenues currently stand at approximately $2.2 trillion a year and are likely to remain stagnant as the recession continues. Our outlays are $3.7 trillion and projected to grow every year. Yet we only have to go back to 2004 for federal outlays of $2.2 trillion, and the government was far from small that year. If we simply referred to that year’s spending levels, which would hardly do us fear, we would have a balanced budget right now. If we held the line on spending and the economy actually did grow as estimated, the budget would balance on its own by 2015 with no cuts whatsoever.
We pay 35% more for our military today than we did 10 years ago for the exact same capabilities. The same could be said for the rest of the government. Why has our budget doubled in 10 years? This country doesn’t have double the population or double the land area or double anything that would require the federal government to grow by such an obscene amount.
In Washington terms a simple freeze in spending would be a much bigger cut than any plan being discussed. If politicians simply cannot bear to implement actual cuts to actual spending, just freezing the budget would give the economy the best chance to catch its breath, recover and grow.
Calvin Coolidge – Ron Paul, MONEY BOMB: August 3rd, 2011
URGENT!!! The Ron Paul 2012 presidential campaign recently sent out a letter asking the grassroots to help them raise needed funds before the Ames straw poll in Iowa on August 13th. In light of this call to action, on August 3rd, 2011, supporters of Ron Paul will hold a ‘moneybomb’ for THREE reasons:
1) The campaign has asked us to help them reach a goal.
2) August 3rd is the date Calvin Coolidge was sworn in as president 88 years ago. Coolidge shared many views that are synonymous with what Ron Paul believes in — taxation, non-interventionist foreign policy, individualism — Calvin Coolidge serves as proof that not only is Ron Paul a REAL Republican, but THE Republican that the GOP should nominate in their primaries to go up against Obama in 2012.
3) August 3rd is exactly one day after the supposed “apocalyptic” catastrophe that will occur on August 2nd if America’s debt ceiling is not raised. We believe that Congressman Paul’s argument that the world will NOT come to an end after this date will be vindicated.
These are the reasons why August 3rd, 2011, has been chosen as the date for the next MoneyBomb fundraiser.
THEN, throughout the week following August 3rd, we will continue to donate money to Dr. Paul’s campaign up until Wednesday, August 10th. This will help ensure that the campaign will have all the funds it needs in order to properly advertise, etc. for the Ames straw poll three days later on the 13th.
Ron Paul’s Texas Straight Talk: Hey Congress, Stop Stealing From the American People
Ron Paul’s Texas Straight Talk 7/25/11: Hey Congress, Stop Stealing From the American People
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