Are US Taxpayers Bailing Out Greece?

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by Ron Paul: More
Spending Is Always the Answer

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Last week we
were reminded that ours is not the only country suffering from severe
economic turmoil. The Greek government is the latest to come close
to default on their massive public debt. Greece has insufficient
funds in their treasury to make even the minimum payments that are
now coming due. Their debt level is about 120 percent of their gross
domestic product and their public sector absorbs what amounts to
40 percent of GDP. Any talk of cutting costs and spending is met
with violent protests from the many Greeks heavily dependent on
government payments. Mounting fears of default have sent shockwaves
through their creditors and all of the eurozone countries.

But there have
been statements made by the European Central Bank to calm fears
and give assurances that Greece will get the aid it needs. Details
of agreements are not forthcoming.

Is it possible
that our Federal Reserve has had some hand in bailing out Greece?
The fact is, we don’t know, and current laws exempt agreements
between the Fed and foreign central banks from disclosure or audit.

Greece is only
the latest in a series of countries that have faced this type of
crisis in recent memory. Not too long ago the same types of fears
were mounting about Dubai, and before that, Iceland. Several other
countries (Spain, Portugal, Ireland, Latvia) are approaching crisis
levels with public debt as well. Many have strong ties to Goldman
Sachs and the case could easily be made that default could have
serious implications for big US banking cartels. Considering the
ties between the Fed and these big banks, it is not outlandish to
wonder if the US taxpayer is secretly bailing out the entire world,
country by country, even as our real unemployment tops 20 percent.
Unless laws are changed to allow a complete and meaningful audit
of the Federal Reserve, including its agreements with foreign central
banks, we might never know if this is occurring or not.

This global
financial crisis is a predictable result of secretive central banking
and unsound fiat currency. Governments are entirely committed to
this system of fiat money and fractional reserve banking for obvious
reasons: it enables them to do what they love most, namely, spend
hoards of money with near impunity. Without the limitations of sound
money, governments will spend without limit. They will spend money
to hire their cronies, pay off special interests, give out favors,
create dependence and generally distract from the terrible job they
do at their chief mandate, which is to protect the liberties of
the people. Fiat money is a blank check to government, which is
very dangerous, and we are witnessing the death throes of the system
as the bills come due and the underlying capital is squandered away.

Because of
our globe-straddling empire and lingering reserve currency status,
perhaps no one has a more vested interest in keeping this system
cobbled together than our own government and the Federal Reserve.
The agreements that Iceland and Dubai and Greece have negotiated
can amount to little more than kicking the can down the road, as
their overall spending habits remain largely intact, fiat currencies
are still legal tender and more debt is issued on top of unsustainable
debt. The American people have the right to know if they are going
to be the ones holding the bag in the end because the Federal Reserve
secretly put them on the hook for it. This knowledge would be a
key factor in peacefully dismantling this immoral and unconstitutional

the Ron Paul File

22, 2010

Dr. Ron
Paul is a Republican member of Congress from Texas.

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