by Ron Paul: US
Out of Yemen
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the House approved another increase in the national debt ceiling.
This means the government can borrow $1.9 trillion more to stay
afloat and avoid default. It has been little more than a year since
the last debt limit increase, and graphs showing the debt limit
over time show a steep, almost vertical trend. It is not likely
to be very long before this new ceiling is met and the government
is back on the brink between default and borrowing us further into
oblivion. Congressional leaders and the administration acknowledge
that the debt limit will need to be increased again next year. They
are crossing their fingers that the forecasts are correct and they
will not need another increase sooner, even before the 2010 midterm
increasing the debt is one of the logical outcomes of Keynesianism,
since more government spending is always their answer. It is claimed
that government must not stop spending when the economy is so fragile.
Government must act. Yet, when times are good, government also increases
in size and scope, because we can afford it, it is claimed. There
is never a good time to rein in government spending according to
Keynesian economists and the proponents of big government.
Austrian economists on the other hand know that times are bad because
of the size and scope of government. The economy is fragile because
of the overwhelming stranglehold of bureaucracy and taxation of
Washington. Any jobs Washington might create through these endless
spending programs are paid for through more taxation and debt put
on the productive sectors of the economy. Just as insidious is the
hidden tax of inflation caused by the Fed and its ever-expanding
credit bubble. When the Fed steps in with its solutions, it only
devalues the dollars in everyone’s pocket while encouraging
more reckless waste on Wall Street. All of this leads to a worsening
economy, not an improved one.
And so the
downward spiral continues. The worse things get, the more politicians
want to spend. The more they spend, the heavier the debt load becomes
and the more we have to spend just to maintain our interest payments.
As our debt load becomes unsustainable, the alarm of our creditors
increases. It is becoming so serious that our credit rating, as
a nation, could be downgraded. If this happens, interest on the
national debt will increase even more, leading to even higher taxes
on Americans and inevitably, price inflation.
is full of talk of more regulation, more taxation and more spending.
The Senate is still struggling to pass a massive regulatory increase
on the financial sector, even as the stock market suffers more shockwaves.
Pay-as-you-go rules give the appearance of fiscal responsibility,
but in truth these rules are only used as a justification to raise
taxes. Spending programs like healthcare reform, increased military
spending, and a recent doubling of destructive foreign aid are viewed
by Washington as necessary and reasonable, instead of foolishness
we absolutely cannot afford.
understand this, which is why there is so much anger directed at
politicians. Washington needs to change its thinking and adopt some
commonsense priorities. The Constitution gives some excellent limitations
that would get us back on the right path if we would simply abide
by them. The framers of the Constitution understood that only the
ingenuity of the American people, free from government interference,
could get us through hard times, yet Washington seems bent only
on prolonging the agony.
Paul is a Republican member of Congress from Texas.