by Ron Paul: The
Fed’s Interesting Week
Wants to "End the Fed": Bring Back Sound Monetary Policies
Backed by Something More Substantial Than Printing Presses
the Government Hates Competition. ~ Plaque on the desk of Rep.
the plaque on the desk of Ron Paul, R-TX, the so-called (by his
detractors) "Doctor No" of the Congress, one would think
he hates government. But, as he shows in his latest book, End
the Fed (Grand Central Publishing, 224 pages, $21.99) he
doesn’t hate government, he just wants it to do what the Constitution
says it should do — nothing more and nothing less.
that he thinks is not only unconstitutional, but philosophically,
economically and morally wrong is the Federal Reserve System, established
in 1913 — the same year as the federal income tax — as a backdoor
approach to a central bank. It was developed — like the various
czars, Troubled Asset Rescue Program (TARP) and bailouts of car
companies and banks — in response to a financial depression, one
that occurred in 1907.
In the post-meltdown
world, Paul says it is irresponsible, ineffective, and ultimately
useless to have a serious economic debate without considering and
challenging the role of the Federal Reserve. Throughout the book
— and especially in the last chapter, "The Way Out,"
Paul shows how the nation functioned just fine without a central
bank. The states don’t have central banks and must rely on tax revenue
to live within their means, he says. He would like to see a return
to the gold standard, but even without this ideal situation we shouldn’t
wait for one before we end the Fed. Too, arguments that a central
bank would prevent financial panics certainly haven’t come true
in the almost 100 years we’ve had the Fed. In his view, the Great
Depression was at least partially caused by the actions of the Fed.
the Fed is like questioning Mom, apple pie and the American way
to most people who are unaware of its genesis at a meeting at Jekyll
Island, Georgia in 1910. Most people think of the Fed as an indispensable
institution without which the country’s economy could not properly
function. But in End the Fed, Ron Paul, a 2008 GOP Presidential
contender and the 1988 Libertarian Party Presidential candidate,
draws on American history, economics, and fascinating stories from
his own long political life to argue that the Fed is both corrupt
and unconstitutional. It is inflating currency today at nearly a
Weimar Republic (Germany from 1919—1933) or Zimbabwe level,
a practice that threatens to put us into an inflationary depression
where $100 bills are worthless.
What most people
don’t realize is that the Fed — created by the Morgans and
Rockefellers at a private club off the coast of Georgia — is
actually working against their own personal interests. Paul’s urgent
appeal to all citizens and officials tells us where we went wrong
and what we need to do fix America’s economic policy for future
Paul, a physician,
is a dedicated follower of the Austrian school of economics — he’s
a distinguished counselor to the Ludwig von Mises Institute, keeper
of the flame for the Austrian school — and he quotes many of that
school’s economists in his arguments against the Fed.
One of them
is the late Murray N. Rothbard, who argued in his book History
of Money and Banking, that the Fed did not originate as
a policy response to national need. It wasn’t erected for any of
its stated purposes. It was founded by two groups of elites: government
officials and large financial and banking interests. Rothbard adds
a third critical element: economists hired to give the scheme a
to the Fed has come from the Left and the Right. An AlterNet story
on the Left quotes a study by Huffington Post’s Ryan Grim makes
the same point Rothbard made in his book: That the Fed has dedicated
itself to marginalizing economists who question the Fed.
Paul is a Republican member of Congress from Texas.
© 2009 Basil