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The Road to Authoritarianism Is Paved with Fiat Currency
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Last week, the Federal Reserve announced it will maintain an interest rate target of zero to 0.25 percent for the rest of 2021. The Fed said it will also continue its monthly purchase of 120 billion dollars of Treasury and mortgage-backed securities.

Some Fed board members are forecasting a rate increase by late 2022 or 2023, though with the rate still not reaching one percent. The Fed will neither allow interest rates to rise to market levels nor reduce its purchase of Treasury securities. A significant increase in interest rates would make the government’s borrowing costs unsustainable.

The Fed also raised its projected rate of inflation to three percent, although it still insists the rise in prices is a transitory effect of the end of the lockdowns. There is some truth to this, as it will take some time for businesses to get back to full capacity. However, the Fed began taking extraordinary measures to prop up the economy in September of 2019, when it started pumping billions of dollars a day into the repo market that banks use to make short-term loans to each other. The lockdowns only postponed and deepened the forthcoming Fed-caused meltdown.

Germany’s Deutsche Bank recently released a paper warning about the Federal Reserve continuing to disregard the inflation risk caused by easy money policies designed to “stimulate” the economy and facilitate massive government spending. Germans have reason to be sensitive to the consequences of inflation, including hyperinflation. Out-of-control inflation played a major role in the collapse of the German economy in the 1920s, which led to the rise of the National Socialists.

This pattern could repeat itself in America where we have already witnessed the rise of authoritarian movements. Last summer, groups exploited legitimate concerns about police misconduct to ferment violence across the country. Can anyone doubt that an economic crisis that leads to mass unemployment, foreclosures, and maybe even shortages will result in large-scale violence? Or that the violence will be exploited by power-hungry politicians? Or that many people will once again fall for the big lie that preserving safety requires giving up their liberty?

The apparatus of repression already exists in the form of a surveillance state, police militarization, and big tech’s cooperation with big government to stamp out dissent. Now, President Biden and his congressional allies want to use the January 6 US Capitol turmoil to justify expanding government powers in the name of stopping “domestic terrorists.” Part of this new campaign is expanding censorship of “extremism,” defined as any views that threaten the status quo. The Biden administration has taken a page from the Communist playbook in suggesting people report their friends and family who are becoming “radicalized.”

We may still have time to prevent collapse in America, or at least to make sure the collapse leads to a transition to a free society. The key to success is spreading the ideas of liberty until we have the ability to force the politicians to dismantle the welfare-warfare state and the fiat money system that is the lifeblood of authoritarian government.

(Republished from The Ron Paul Institute by permission of author or representative)
 
• Category: Economics • Tags: Civil Liberties, Federal Reserve, Inflation 
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  1. In the face of creeping totalitarianism, a conservative manifesto for American Conservatives must be developed and consecrated.

    In this document, the fundamental liberties must be reaffirmed, including the right to criticize, satirize and mock anyone. Anything can be questioned, including World War 2 history. The right to assemble and freedom of conscience shall not be infringed. The right to private communications shall be protected, and censorship by tech providers shall not be permitted.

    The cost of taking this stand will be fire and fury, but there is no other way to stop an ideological steamroller.

  2. SafeNow says:

    It has been said that Americans tend to embrace what has been called “the con style.” Cuomo’s 82% approval rating, or the preposterous Dr. Fauci’s having mesmerized the country; and on and on. The country is now at the mercy of its preference for “the con style.” This predilection is the trunk and taproot of the unraveling, everything else the branches and leaves.

  3. We may still have time to prevent collapse in America,

    Nah.

    or at least to make sure the collapse leads to a transition to a free society.

    Right!

    I’m glad Ron Paul is coming around to the truth in his last, normally optimstic, now semi-optimistic, last paragraphs.

  4. Out-of-control inflation played a major role in the collapse of the German economy in the 1920s, which led to the rise of the National Socialists.

    Thank God we defeated Hitler! Can you imagine living in a world of open borders, credit card usury, government-approved riots, sleight-of-hand tricks by a (((central banking cabal))), no freedom of speech and grooming children? Where your race is demonized for its evil, unforgivable achievements, culture and traditions?

    Hug your mulatto transexual grandchild a little tighter tonight. The good guys won.

    • LOL: The Anti-Gnostic
    • Troll: Corvinus
  5. I thought the headline an odd subject for Mr. Paul to be ignorant enough on, so as to write that headline. I read it just to see where I need to “correct my betters”. Turns out the article does not mention fiat currency even once.
    So, there’s no need for me to point out that “fiat money” is not some devilish scam; if my government decides tomorrow we all use diamonds to pay for stuff, diamonds become the new fiat currency. “Fiat” really just means “as declared by decree”. Such a decree is very much needed, for us to know what to pay taxes with, we need a “fiat” currency.
    Related to the things I have no reason to say, is, of course, “Greenbacks”. Had the author used that term in the spirit of the headline, I would need to point out that “greenback” does not equal “dollar”. I would go into a tirade about how “greenbacks” refer to State-issued money, as opposed to the current scam, where the State has to borrow every blue cent from “Investors”, at interest rates and preconditions that ensure it is never paid back, needing new lowns on a regular basis, JUST TO SERVE THE OLD LOANS.
    This corrupt system of public wage enslavement is what I think people refer to as “fiat money”. They should be demanding Greenbacks, instead of “foreign loans”. That would be the road back from the hellish pits of Bolshevik globalism.
    So, to at least fix that damnable headline:
    The Road to Authoritarianism is Paved with Privatised Central Banksters.

  6. Germany’s well-known hyperinflation of the 1920s took place in a defeated, disarmed, dismembered nation, its gold reserves looted by the conquerors, after it defaulted on the massive, impossible “reparations” payments demanded by its overlords. It was only natural that a strong authoritarian government emerged to replace the American style pretend democracy imposed on Germany by the imperialist powers in order to facilitate the plunder. The United States on the other hand has a massive, robust economic and military machine, with no enemies strong enough to dictate its policies (save one erstwhile “ally”) and a tradition of civil liberty that goes back centuries. The endless comparisons to 1920s Germany, with the sensationalized warning of impending tyranny, are no more than red herrings artfully employed by both Rightists and Leftists who lust to have their extremist agendas taken seriously despite having almost exactly zero popular support. Wikipedia says that of the 620 bills that Ron Paul sponsored over his twenty-two years in Congress, only one became law – allowing a federal customhouse to be sold to a local historic preservation society. Do we hear the phrase “out of touch with reality,” at all here?

    • Replies: @Achmed E. Newman
  7. @Observator

    While I agree with your comparison of 1920s Germany and the former American Republic, Observator, if you can’t see what’s going on financially right now, I don’t know what more to tell you. The financial shit WILL hit the fan. It’s not a question of “if”, but whether next year or later in the decade.

    As for Ron Paul, his problem (and ours) was that there weren’t a couple of hundred Constitutionalists like him in the House and in the Senate. The fact that he didn’t add more regulation on top of the Feral Gov’t clown show we have now is something to be proud of.

    In case you don’t recall, Rep. Ron Paul was known as “Dr. No”. He’s a doctor, of course, and he’d vote “nay” on any bill that wasn’t Constitutional. Again, if we’d had many others like him, no, we wouldn’t have to discuss this financial SHTF coming soon.

    • Agree: nokangaroos, Rurik
  8. Gerion says:

    The entire article is poorly posed, as was the entire first half of the 20th century. It is the liberal democracies that have become totalitarian (globalist). The so-called extremists fight this. The victorious democracies of World War II are the ones that are orchestrating the false pandemic. Ergo, many of the totalitarianisms of the early twentieth century, would be against this current principle of totalitarianism. Things are not as they are counted.

  9. It is not that a Gold Standard cannot be manipulated. The best example would be the British India; in spite of always having the largest holdings and hoardings of gold, British put India on a silver standard, and refused to mint gold coins. And this in spite of open minting, where anyone can exchange metal gold for coins. This led to a scarcity of gold coins, and proved to be a boon to those who had first access to the new coins. At some stage, EIC altogether stopping minting gold coins. Then only gold bars were allowed to be traded; most of that was bought by the EIC and sent home, towards repayment of innumerable loans, pensions to retired officers, and plain old tribute. India became progressively weak; the discovery of silver in immense quantities lowered the value of Indian silver Rupee by 33%, and even after that, it had to be artificially propped up by the Indian government subsidies. (Indian pension to the British officers was in silver Rupees, but payable in England in gold standard Pounds; the Indian government undertook to pay the pension at fixed rates of 1 pound = Rs 15).

    Even the most liberal Gold Standard can be manipulated by simply preventing gold coinage, and then restricting promissory notes and bank notes. This results in an increased demand for high value currency, and the debtors are squeezed out of existence.

    So, if there is going to be a gold standard, it has to be along the original pattern: a fixed weight of gold, instead of a unit of currency; that is, 8 grams of gold instead of 1 pound gold coin. Coins can always be debased. And remove the Central Bankster monopoly of debt based paper currency.

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