Monday, February 23, 2009
Ron Paul: On Transparency of the Fed......
by Ron Paul | Texas Straight Talk
February 23, 2009
This week the Federal Reserve responded to the American people’s increased concerns over our monetary policy by presenting new initiatives aimed at enhancing the Fed’s transparency and accountability. As someone who has called for more openness from the Fed for over 30 years, I was pleased to see the Fed acknowledge the legitimacy of this need.
The Federal Reserve controls the flow of money and credit in our economy because Congress has abdicated its responsibility over the nation’s currency. This process therefore occurs centrally, and almost completely outside the system of checks and balances. Because of legal tender laws, people are left with no real choice, except to build their lives and futures around this monopoly currency, vulnerable to powerful central bankers. The Founding Fathers intended only gold and silver to be used as currency, however, inch by inch over the decades, this country has backed away from this important restraint. Our money today has no link whatsoever to gold or silver. For many reasons, this is extremely dangerous, and has a lot to do with the boom and bust cycles that have resulted in the crisis in which we find ourselves today.
The Fed is now pledging to reveal to the public more about its economic predictions, and calls this greater transparency. This is little more than window-dressing, at best, utterly useless at worst. Many analysts, especially those familiar with the Austrian school of economics, saw the current economic crisis coming years ago when the Federal Reserve was still telling the American people their policies were as good as gold. So while it might be nice to know what fantasy-infused outlook the Fed has on the economy, I am much more interested in what they are doing as a result of their faulty, haphazard interpretation of data. For instance, what arrangements do they have with other foreign central banks? What the Fed does on that front could very well affect or undermine foreign policy, or even contribute to starting a war.
We also need to know the source and destination of funds provided through the Fed’s emergency funding facilities. Information such as this will provide a more accurate and complete picture of the true cost of these endless bailouts and spending packages, and could very likely affect the decisions being made in Congress. But with so much of the Fed’s business cloaked in secrecy, these latest initiatives will not even scratch the surface of the Fed’s opaque operations. People are demanding answers and explanations for our economic malaise, and we should settle for nothing less than the whole truth on monetary policy.
The first step is to pass legislation I will soon introduce requiring an audit of the Federal Reserve so we can at least get an accurate picture of what is happening with our money. If this audit reveals what I suspect, and Congress has finally had enough, they can also pass my legislation to abolish the Federal Reserve and put control of the economy’s lifeblood, the currency, back where it Constitutionally belongs. If Congress refuses to do these two things, the very least they could do is repeal legal tender laws and allow people to choose a different currency in which to operate. If the Fed refuses to open its books to an audit, and Congress refuses to demand this, the people should not be subject to the whims of this secretive and incompetent organization.
February 23, 2009
This week the Federal Reserve responded to the American people’s increased concerns over our monetary policy by presenting new initiatives aimed at enhancing the Fed’s transparency and accountability. As someone who has called for more openness from the Fed for over 30 years, I was pleased to see the Fed acknowledge the legitimacy of this need.
The Federal Reserve controls the flow of money and credit in our economy because Congress has abdicated its responsibility over the nation’s currency. This process therefore occurs centrally, and almost completely outside the system of checks and balances. Because of legal tender laws, people are left with no real choice, except to build their lives and futures around this monopoly currency, vulnerable to powerful central bankers. The Founding Fathers intended only gold and silver to be used as currency, however, inch by inch over the decades, this country has backed away from this important restraint. Our money today has no link whatsoever to gold or silver. For many reasons, this is extremely dangerous, and has a lot to do with the boom and bust cycles that have resulted in the crisis in which we find ourselves today.
The Fed is now pledging to reveal to the public more about its economic predictions, and calls this greater transparency. This is little more than window-dressing, at best, utterly useless at worst. Many analysts, especially those familiar with the Austrian school of economics, saw the current economic crisis coming years ago when the Federal Reserve was still telling the American people their policies were as good as gold. So while it might be nice to know what fantasy-infused outlook the Fed has on the economy, I am much more interested in what they are doing as a result of their faulty, haphazard interpretation of data. For instance, what arrangements do they have with other foreign central banks? What the Fed does on that front could very well affect or undermine foreign policy, or even contribute to starting a war.
We also need to know the source and destination of funds provided through the Fed’s emergency funding facilities. Information such as this will provide a more accurate and complete picture of the true cost of these endless bailouts and spending packages, and could very likely affect the decisions being made in Congress. But with so much of the Fed’s business cloaked in secrecy, these latest initiatives will not even scratch the surface of the Fed’s opaque operations. People are demanding answers and explanations for our economic malaise, and we should settle for nothing less than the whole truth on monetary policy.
The first step is to pass legislation I will soon introduce requiring an audit of the Federal Reserve so we can at least get an accurate picture of what is happening with our money. If this audit reveals what I suspect, and Congress has finally had enough, they can also pass my legislation to abolish the Federal Reserve and put control of the economy’s lifeblood, the currency, back where it Constitutionally belongs. If Congress refuses to do these two things, the very least they could do is repeal legal tender laws and allow people to choose a different currency in which to operate. If the Fed refuses to open its books to an audit, and Congress refuses to demand this, the people should not be subject to the whims of this secretive and incompetent organization.
Democrats who backed Bush policies....
In a little noticed one-line remark on Sunday, Senate Judiciary Chairman Patrick Leahy (D-VT) endorsed the investigation of Democrats who approved of President George W. Bush's policies as president that he aims to review as part of a "truth commission." The veteran Democrat has floated the idea of a "truth commission" to probe and put to rest alleged Bush Administration constitutional abuses, in areas such as wiretapping and harsh interrogation. Those who participated would likely be granted immunity from prosecution so long as their testimony is truthful, mirroring similar venues of public catharsis as were practiced in South Africa and Chile in previous decades...Link
Iran's nuke program not weapons-capable....
Can Iran build a nuclear bomb? The new answer to that long-debated question is "yes," if you ask the Washington-based Institute for Science and International Security (ISIS). The non-partisan think-tank, which focuses on stopping nuclear proliferation, released a report Thursday citing a brand-new report from the U.N.'s nuclear watchdog that declared Iran had reached "nuclear weapons breakout capability." Not so fast, says an official at the International Atomic Energy Agency, which released its report Thursday, according to IAEA's website. The report can be found here, at ISIS's website....Link
Obama administration backs Bush........
The Obama administration, siding with former President George W. Bush, is trying to kill a lawsuit that seeks to recover what could be millions of missing White House e-mails in a stunning reversal of Obama's rhetoric about Bush secrecy on the campaign trail. Two advocacy groups suing the Executive Office of the President, including one of the groups that helped derail former House Speaker Tom DeLay, say that large amounts of White House e-mail documenting Bush's eight years in office may still be missing, and that the government must undertake an extensive recovery effort. They expressed disappointment that Obama's Justice Department is continuing the Bush administration's bid to get the lawsuits dismissed....Link
Obama's take on the drug war.......
Fissures are suddenly forming along the edges of the giant iceberg of America's multibillion-dollar "war" on drug use, first formally proclaimed by President Richard Nixon in 1971. But so much depends on what President Barack Obama decides to do with the issue. This month a Latin American commission headed by former Presidents Fernando Henrique Cardoso of Brazil, Ernesto Zedillo of Mexico and Cesar Gaviria of Colombia condemned harsh U.S. drug prohibition policies that are based, in Gaviria's words, "on prejudices and fears and not on results." Fueled by Americans' drug appetite and dollars, drug-gang violence is engulfing Mexico, threatening the very stability of the state with massive corruption and close to 6,000 killings last year. Brazil is afflicted with daily gun battles between police and gangs in urban slums. And despite years of intensive U.S.-backed efforts to eradicate Colombia's cocaine exports, official reports show they've risen 15 percent in this decade. A high proportion are smuggled into the U.S.....Link
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