The Unz Review - Mobile
A Collection of Interesting, Important, and Controversial Perspectives Largely Excluded from the American Mainstream Media
 BlogviewRon Paul Archive
Economic Storm Clouds Gather, But Ending the Fed Provides Hope
🔊 Listen RSS
Email This Page to Someone

 Remember My Information



=>

Bookmark Toggle AllToCAdd to LibraryRemove from Library • BShow CommentNext New CommentNext New ReplyRead More
ReplyAgree/Disagree/Etc. More... This Commenter This Thread Hide Thread Display All Comments
AgreeDisagreeLOLTroll
These buttons register your public Agreement, Disagreement, Troll, or LOL with the selected comment. They are ONLY available to recent, frequent commenters who have saved their Name+Email using the 'Remember My Information' checkbox, and may also ONLY be used once per hour.
Ignore Commenter Follow Commenter
Search Text Case Sensitive  Exact Words  Include Comments
List of Bookmarks

The Federal Reserve recently increased interest rates to 1.75 percent. This is the highest interest rates have been since 2008, but it still leaves rates at historic lows. While the Fed says economic growth justifies future rate increases, an honest examination of the economy suggests that future rate increases are unlikely.

The Fed’s claim that the economy is strong is based on misleading government statistics. For example, the official unemployment rate understates true unemployment by not counting those who have given up looking for work. According to John Williams of Shadow Government Statistics, the real unemployment rate is above 20 percent. Government figures also understate the rate of inflation by pretending that you are not negatively impacted by inflation if you can still buy hamburger when you cannot afford steak. Shadow Stats estimates that the real rate of inflation is as much as four times higher than the official rate.

President Trump’s tariffs will further weaken the economy. While export-driven industries, including manufacturers that rely on imported materials, will be particularly hard-hit, the tariffs combined with the inevitable retaliation from other counties will impact all sectors of the economy. A global trade war could also lead other countries to stop buying US debt instruments, increasing pressure on the Fed to keep rates low.

Since Republicans have held control of the White House and Congress over the last year, federal spending has increased 12.9 percent. Clearly those in Congress serious about reducing government spending are few and far between. The sad fact is that both major parties are happy to increase welfare and warfare spending, although many Republicans pretend to oppose deficits when a Democrat sits in the White House. This puts tremendous pressure on the Fed to keep rates low so as not to increase the federal government’s already high interest payments.

This cannot last forever. Eventually the combination of a spendthrift Congress and a print-happy central bank will cause a major economic crisis. This crisis will herald the end of the welfare-warfare state and the fiat money system that sustains it. The only question is whether the existing system will be replaced by a free market and limited constitutional government or we will complete our descent into totalitarianism.

Fortunately, more Americans are becoming aware of the freedom philosophy and demanding that government roll back the welfare-warfare state and rein in the Fed. Many are also demanding protection of their right to opt out — not just from government programs like Obamacare but also from the Federal Reserve System. For example, Wyoming recently joined Arizona in passing a law recognizing gold and silver as legal tender. Citizens of these states are now able to protect themselves from the coming dollar crisis by using what has historically been considered real money.

At the federal level, the movement to audit the Fed remains strong. As the failures of Keynesianism become more apparent, the movement to audit and end the Fed will grow in size and strength. Hopefully this movement will ensure the end of the welfare-warfare state and the fiat currency system as well as lead to a new era of liberty.

(Republished from The Ron Paul Institute by permission of author or representative)
 
• Category: Economics • Tags: Federal Reserve, Government Spending 
Hide 9 CommentsLeave a Comment
Commenters to Ignore...to FollowEndorsed Only
Trim Comments?
    []
  1. D. K. says:

    “The only question is whether the existing system will be replaced by a free market and limited constitutional government or we will complete our descent into totalitarianism.”

    How can Dr. Paul doubt that when the United States of America becomes the largest, most diverse, and most overpopulated country in Latin America that it will have become a Libertarian Utopia?

  2. Svigor says:

    Ron, we got plenty of other existential crises to cover, but you libertardians are still stuck on the fed and legal pot.

    GROW SOME BALLS. Act like your values are genuinely held, and denounce anti-Freedom laws (so-called “anti-discrimination” laws). Denounce the ongoing project of soft genocide of European peoples by open borders and mass immigration invasion.

    At least acknowledge how thoroughly the opioid crisis has raped the stupid libertardian obsession with drug legalization.

    • Replies: @advancedatheist
    , @jtgw
  3. You can already find Federal Reserve audits online as free public documents:

    https://www.federalreserve.gov/aboutthefed/audited-annual-financial-statements.htm

    So I don’t see what Dr. Paul gratuitous audit would accomplish, other than telling us what we already know, namely, that the Fed has complied with the law.

  4. @Svigor

    Dr. Paul keeps up his nonsensical attacks on the Fed because he knows that he can pretend to defy the state without having to inconvenience his comfortable life; as long as he avoids the JQ aspect of who runs the Fed, he can condemn fiat money, central banking and inflation without fear that anything bad will happen to him as a consequence.

    Which at least shows that he has more sense than the crackpots who took their libertarianism “seriously” by denying the tax laws and going to prison, like Irwin Schiff and Robert Beale.

    • Replies: @jtgw
  5. A debt-based monetary system will always fail. END THE FED….. MAGA will follow.
    All wars are banker/MIC wars. So long as the devil has a blank check, expect him to do bad things.

    • Agree: jacques sheete
  6. jtgw says:
    @advancedatheist

    “as long as he avoids the JQ aspect of who runs the Fed, he can condemn fiat money, central banking and inflation without fear that anything bad will happen to him as a consequence.”

    I’m confused. Do you think the Fed is a good or bad thing? Just above you claimed that the Fed is already audited (by an accounting firm employed by the Fed rather than by Congress, but whatever); you made it sound like there was nothing there to worry about. Now you’re castigating RP for not talking about the Jews at the Fed. Why would he need to talk about the Jews or anybody else at the Fed if the Fed is nothing to worry about?

  7. jtgw says:
    @Svigor

    The Fed is the main reason our economy sucks. All the other ills people worry about flow from Fed policy. Fed policy is why we’re running a permanent trade deficit with China and other trading partners; under a hard money system, money flowing out of the country in exchange for foreign goods would either have to be used to buy American goods or else our purchase of foreign goods would have to stop. But if we keep adding new money, we can keep buying foreign goods without the foreigners needing to buy our goods in return.

    http://davidstockmanscontracorner.com/hey-donald-its-not-bad-trade-deals-its-bad-money-part-1/

    http://davidstockmanscontracorner.com/its-not-bad-trade-deals-its-bad-money-part-2/

    Fed policy is also the reason middle and working class incomes stagnate while rich people’s incomes soar. Worker productivity has been rising due to capital investment, but this should lead to higher real wages as the cost of goods goes down. New money creation means the banks and big corporations that get the new money first can buy up all the goods, driving up prices for the rest of us and leaving us with less.

  8. Miro23 says:

    This is a good article with an interesting observation:

    Many are also demanding protection of their right to opt out — not just from government programs like Obamacare but also from the Federal Reserve System. For example, Wyoming recently joined Arizona in passing a law recognizing gold and silver as legal tender. Citizens of these states are now able to protect themselves from the coming dollar crisis by using what has historically been considered real money.

    “Demanding protection of their right to opt out” is an interesting concept.

    It’s a way for local political units (States in this case) to claim some autonomy for their people. Metaphorically, they are building lifeboats to escape a sinking ship. No doubt the upper decks will try to lock down steerage (need to keep control – don’t want a riot) but the activity below decks shows a lack of confidence in the officers running the ship.

    Wyoming could for example continue the process, by developing shadow state authorities to cover all the major areas like education, healthcare, law, commerce etc. in case the Federal level fails. If the dollar collapses then they have their own currency ready to go based on local stocks of precious metals or Wyoming land value certificates.

  9. No doubt the upper decks will try to lock down steerage …

    No doubt about it, and that answers RP’s question, (which need not have been asked):

    The only question is whether the existing system will be replaced by a free market and limited constitutional government or we will complete our descent into totalitarianism.

    In fact, if we’re not living under totalitarianism as we speak, then what would qualify?

Current Commenter
says:

Leave a Reply - Comments on articles more than two weeks old will be judged much more strictly on quality and tone


 Remember My InformationWhy?
 Email Replies to my Comment
Submitted comments become the property of The Unz Review and may be republished elsewhere at the sole discretion of the latter
Subscribe to This Comment Thread via RSS Subscribe to All Ron Paul Comments via RSS