Ron Paul Introduces Legislation To Get Rid Of Federal Reserve

WorldNetDaily.com ^ | September 17, 2002 | Jon Dougherty

[Red Jones]

Bill to eliminate the Fed introduced Rep. Paul: Legislation seeks to 'restore financial stability' to U.S.

By Jon Dougherty © 2002 WorldNetDaily.com

A Republican lawmaker has introduced legislation to abolish the Federal Reserve as a way to "restore financial stability" to the country and re-establish the once-used gold standard.

"Since the creation of the Federal Reserve, middle and working-class Americans have been victimized by a boom-and-bust monetary policy," said Rep. Ron Paul, R-Texas, in a speech to colleagues on the House floor.

"In addition, most Americans have suffered a steadily eroding purchasing power because of the Federal Reserve's inflationary policies. This represents a real, if hidden, tax imposed on the American people," he said last week while introducing the bill.

The Texas Republican went on to blame each economic downturn from the Great Depression of the 1930s to 2001's "dot-com bubble" on Fed policies.

"The Fed has followed a consistent policy of flooding the economy with easy money, leading to a misallocation of resources and an artificial 'boom' followed by a recession or depression when the Fed-created bubble bursts," said Paul.

On the gold standard, however, which the congressman described as "stable currency," U.S. "exporters will no longer be held hostage to an erratic monetary policy.

"Stabilizing the currency will also give Americans new incentives to save as they will no longer have to fear inflation eroding their savings," he added.

"Those members concerned about increasing America's exports or the low rate of savings should be enthusiastic supporters of this legislation," he said.

Paul's office did not return phone calls before press time.

The libertarian lawmaker also introduced into the congressional record a column by Llewellyn Rockwell, a former WND columnist and current president of the Ludwig von Mises Institute, a libertarian economic policy think tank based in Auburn, Ala.

Entitled, "Why Gold?" Rockwell writes, "The Fed has been inflating the dollar as never before, driving interest rates down to absurdly low levels, even as the federal government has been pushing a mercantile trade policy, and New York City, the hub of the world economy, continues to be threatened by terrorism. ..."

"The government is failing to prevent more successful attacks by not backing down from foreign-policy disasters and by not allowing planes to arm themselves. These are all conditions that make gold particularly attractive," he said.

But, he continued, "there is no stash of gold held by the Fed or the Treasury that backs our currency system. The government owns gold, but not as a monetary asset. It owns it the same way it owns national parks and fighter planes. It's just another asset the government keeps to itself."

Rockwell said the dollar, which has not been based on gold for nearly three decades, is virtually worthless or, at most, whatever the Fed says it's worth.

"The dollar, and all our money, is nothing more and nothing less than what it looks like: a cut piece of linen paper with fancy printing on it," he wrote.

Paul said he believed the system was inherently unfair to ordinary Americans.

"Though the Federal Reserve policy harms the average American, it benefits those in a position to take advantage of the cycles in monetary policy," he said. "The main beneficiaries are those who receive access to artificially inflated money and/or credit before the inflationary effects of the policy impact the entire economy."

He also said most politicians used the Fed's "inflated currency" to hide the "true costs of the welfare state."

"It is time for Congress to put the interests of the American people ahead of the special interests and their own appetite for big government," said Paul. "Abolishing the Federal Reserve will allow Congress to reassert its constitutional authority over monetary policy."

[elfman2]

"So in your world, civilian non-combatants are fair game? Mr Vlad Tepes on line 3 for you. Adolf is still waiting on line 2 as well."

So you're denying that the anti-war anti-capitalism left doesn't lead with appeals for "innocent civilians" whenever America threatens military action?

I don't know Ron Paul enough to accuse him of aligning with anti-war populists on this, but the phraseology is suspicious, especially considering the way we bend over backwards to minimize civilian casualties.

[logician2u]

We are publik skool graduates and we are ignorant.

LOL, Red, so are me.

The US managed to become the world's biggest economic power before the Fed was put into law in 1913, so obviously it's unnecessary to have a central bank for the country's well-being.

Let's begin with what the Constitution says on the subject of money.

Article I, Section 8, which lays out the powers of Congress, says "The Congress shall have Power . . To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures; [and] To provide for the Punishment of counterfeiting the Securities and current Coin of the United States . ."

Then over in Section 10 are limitations on what States may do: "No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility."

The way I read it, the Fedgov has the sole government responsibility for coining money, which would by necessity be coin of gold and silver if the States are required to accept them. "Regulating the value thereof" simply means establishing a conversion rate, which, IMHO, is a market function that could as well be delegated, and in fact works better that way.

The Founding Fathers had recent, disastrous experience with funny money issued after the Revolution and were very skeptical of letting States print currency. "Not worth a Continental" was an 18-century forecast of things to come: not worth a mark, not worth an old ruble, not worth a peso.

All of these currencies collapsed due to not having something of value to back them and the temptation of central bankers to print money to shore up a sagging economy. The really neat thing about inflation, as you know, is that favored interests (banks, the government itself) who get the money right after it's printed can spend it before prices go up, as they inevitably will. Everyone else has to wait until payday or later, when it becomes general knowledge that more money is in circulation and if you want to maintain your purchasing power you'll want to charge more for your goods and labor.

So what is the solution if we don't have a Federal Reserve?

You go back to a metallic currency standard, probably gold, and you don't print any more paper money in excess of the value of gold in the Treasury.

You don't need actual gold coins, although they're pretty to look at. EFTs and ATMs and all the other modern conveniences would still function as usual. We wouldn't need to redeem our Federal Reserve Notes for gold coins. They could simply be gradually replaced with new notes backed by gold.

[Cold Heat]

The Fed's main role is to smooth the knee jerk political and emotional reactions in the financial arena. They regulate the nations money flow by regulating the supply and without them there would be chaos.

This does not exempt them from critisism how ever. They do, on occasion make mistakes. To advocate the removal of the Fed is just plain silly.

[FormerLurker]

Ron Paul is about the ONLY true patriot that holds a seat in Congress that I'm aware of. I respect him and his courage, we DEFINITELY need many more like him.

[Jeff Head]

Well, like I said, while I disagree with him on the kernal reason why the Islamic extremist hate us ... I do agree with him that the less dependancey on foreign oil, the better.

I believe with our own oil reserves (particularly those we are placing "off limits") and with our nuclear (which we have also effectively placed "off limits") and alternate energy capabilities, that our nation could be energy independent within a fe short years if our leaders worked to make it a national priority.

I believe it should be a priority and I believe there are very strong lobbying, internatlional/foreign and internal interests that are bent on keeping it from happening ... and I do not believe that it is in this nation's best interest.

Anyhow, we each have our "moments". While I do not agree with a few things Paul says, I must admit that I find myself in agreement with the vast majority of what he puts forward legislatively and do wish there were many more like him in Congress ... as opposed to the Ted Kennedy's, the Boxers, the Feinsteins, the Shumers, the Dashels, etc., etc.

[2iron]

My view of libertarians is that they tend to be a little strange, invest too much of their savings in gold, believe that the requirement to pay income tax is still an open question, tend to be a little strange, vote for a party that has been increasingly coopted by left leaning people interested in legalizing hemp, and tend to be a little strange.

[Texaggie79]

Ron Paul is taking the correct rout, which is fighting from within the Rep Party.

I don't see the problem in legalizing hemp, or all types of marijuana for that matter. It's a state's issue anyways.

[Dead Corpse]

It isn't so much anti-war as it is a non-initiation of force moral stance that colors his language. The Left has co-opted a lot of interesting language and twisted its meanings.

Anyone trying to equate Dr. Paul with anti-capitalism has no idea what "capitalism" means.

[Destructor]

"You know the card that you signed to open your checking account? That is an agreement to abide by the rules and policies of the Federal Reserve system that gives the government the authority to tax you"

"Care to back that up?"

Naw. I thought about it, but I've decided that I'll just let you find it out first hand at your next audit.

[Mark Felton]

"If you think inflation is a bad problem wait until you see the effects of bank failures on America when there is no Fed or FDIC."

The banks are on their way to failure anyway. Inflation is kept down at a retail level largely due to dirt cheap consumer products made in impoverished, slave-states. And energy prices have been kept low by the cartels.

Debt is at incredibly high levels per GDP (as I understand), and foreign debts payment failures have been covered by large cash infusions from the IMF, world bank etc (US taxpayers mostly), but that is close to being maxed out.

Unsecured debt is failing apace with increasing bankruptcies (both personal and corporate).

At some point, bankruptcies may go nuclear. What happens then?

[tallhappy]

Read number 30 of this thread. They are long quotes from Paul's post 911 speech. Liberal mantras abound.

[Dead Corpse]

Post 50 has the whole statement.

In our grief, we must remember our responsibilities. The Congress' foremost obligation in a constitutional republic is to preserve freedom and provide for national security. Yesterday our efforts to protect our homeland came up short. Our policies that led to that shortcoming must be reevaluated and changed if found to be deficient.

Doesn't sound very liberal at all. He doesn't mention "democracy" or "it's for the children" once.

You, on the other hand, sound like a big government authoritarian.

Got yours yet?

[Smile-n-Win]

Refreshing to see a post on this thread that I completely agree with!

[Smile-n-Win]

If the world was on the gold standard, all the gold in the world would represent all that exists in the world.

You must have read a radical Islamist's definition of the gold standard! ;-) The gold standard doesn't mean, "blow up everything that isn't gold." It simply means that, if you have a dollar bill, you can exchange it to a fixed amount of gold whenever you wish to.

Since most of the people hardly ever want to exchange their banknotes to gold, it wouldn't mean any significant change in how you use your money. But it would change what your money means. Right now, the value of your cash is determined by the Federal Reserve. Alan Greenspan could turn you into a beggar any moment he decided to. With the gold standard, you can always turn your cash into gold, and of course you can then turn the gold into anything you want. Currency, as hard as it gets.

[be131]

Anyone who looks at the history of the U.S. while it was on the Gold Standard would find the notion that it promotes economic stability laughable.

[tallhappy]

Some things override other things.

Who would you think said this:

The continuous bombing and embargo of Iraq, has intensified the hatred and contributed to more than over 1,000,000 deaths in Iraq.

Do you really think that US policy caused 1 million deaths in Iraq? (That's rhetorical, I know you don't).

That's is standard leftist propaganda.

[TexasRepublicans]

Though I have never been quite well-versed enough in monetary policy (confessing that it is very difficult stuff), I am certainly a huge fan of Austrian economics and the general economic libertarian position. Therefore I like Dr. Paul.

But how about this as a starting agenda, seeing as the Fed is likely not to be abolished:

1) Constitution amendment asserting the 10th amendment and saying we mean it this time;

2) Constitutional amendment asserting that the fed o nly gets enumerated powers and saying that we mean it this time;

3) Constitutional amendment repealing the 16th A.;

4)Domestic legislation removing us from the UN.

Well maybe that is not going to fare any better than the gold standard stuff, but I'm inclined to think that it would have an even stronger impact.

[Sonny M]

I'm not sure about this, but didn't the founding fathers, Jefferson and Hamilton in particular have quotes about the dangers of letting banks and bankers controlling monetary policy?

[Tailgunner Joe]

bttt

[weikel]

Okay so which one of you is the real one LOL?