Don’t count Ron Paul out yet. The Texas Congressman may not have secured any headline-grabbing victories in state primaries and caucuses. He may be trailing in the unofficial delegate counts based on these contests. But he is cheerfully pressing onward, confident that he can keep right on going all the way to the Republican National Convention (RNC) in Tampa and possibly even come out of the convention the GOP’s nominee for President.
Even among Paul’s most ardent supporters, few would now argue that the 76-year-old physician is anything but a long shot for the nomination. Long shots, however, occasionally pay off. And Paul has a strategy that he believes just might produce one of the most unexpected come-from-behind victories in U.S. political history.
The Paul campaign understands what few observers of the political scene — and even many players within it — realize: A significant number of the state primaries and caucuses covered by the national media as if they determined the Republican nominee are, as the Paul campaign likes to put it, “beauty contests” that make for an exciting horse race but may have little to do with who ultimately gets the nomination. The media report the popular vote results from a particular state and, unless it is a winner-take-all state, assume that each candidate will receive delegates to the RNC in roughly equal proportion to his share of the popular vote. Thus, reports typically state that Paul has only a tiny fraction of the delegates that former Massachusetts Gov. Mitt Romney has and that therefore he has no chance of being the GOP nominee.
In fact, says Thomas Mullen of the Washington Times' Communities website, “no one knows” how many delegates any of the candidates has — not even the Republican Party itself. We know that the delegates from winner-take-all states such as Florida will be bound to vote for the winners of their respective states’ primaries during the first round of voting at the convention. Likewise, in some states (Nevada, for instance), during the first round delegates will be bound to certain candidates on the basis of the popular vote. Beyond that, Mullen writes, very little is certain:
In other states, the process is not that simple. A popular vote is held, but it’s really no more than a preference poll or “straw poll.” After the straw poll is closed, a series of meetings commence in which delegates are elected from a precinct, district or county, which then elect delegates to a state convention, which then elect the delegates to represent that state at the RNC. This process typically takes months after the straw poll is over and the resulting delegates for each candidate may bear little resemblance to the vote percentage that candidate won in the straw poll.
Paul’s campaign believes that his supporters, typically more enthusiastic and devoted to his candidacy, are more likely to remain after the straw poll and participate in the delegate selection process. There is some evidence that they are correct. For example, the Iowa Republican Party confirms that delegate assignment has nothing to do with the straw poll and that Paul may secure the most delegates from Iowa.
Missouri provides additional evidence that Paul’s delegate strategy could succeed. While former Pennsylvania Sen. Rick Santorum swept the state in the nonbinding presidential primary in February, he did not perform as well during the later caucuses.
The local caucuses chose over 2,000 delegates to regional conventions, which will then send people on to the state convention, where delegates to the RNC will be bound to vote for certain candidates. In several local caucuses Paul and Romney supporters teamed up to deny most or all of the delegates to Santorum. In at least three counties Santorum didn’t get a single delegate while Paul got a majority of the delegates. In Greene County Paul got 65 delegates; Romney, 40; and Santorum, just six.
“We are focusing on caucus states, just like we always have,” Paul Campaign Chairman Jesse Benton told U.S. News & World Report. “It puts us in the driver’s seat to easily win many. There is still work to be done, and we understand that we are going to have to stay on our game to maintain our position.”
The campaign believes that it may very well walk away with a majority or plurality of the delegates in several states.
“We are training people to go, show up and go through the delegate process,” Benton added.
The campaign is also “hoarding cash” in order to make a good showing in California and Texas, Benton told MSNBC. Doing well in the popular vote in those big states would almost certainly secure some bound delegates from them. It could also provide a boost to fundraising and encourage more people to sign on as Paul delegates in the belief that he could win the nomination after all.
How he could win it is another matter. He is still highly unlikely to overtake Romney in the quest for a majority of the delegates to the RNC. However, if at least 1,144 delegates do not vote for Romney on the first ballot at the convention, there will be a “brokered convention.” Delegates will vote a second time (and successive times if necessary); but after the first vote they are no longer committed to any particular candidate. “Then they can vote their conscience,” Paul told Jay Leno last week. “Then I believe we’ll get a lot of their votes.”
Of course, one’s conscience does not always win out over one’s desire for partisan victory. People often vote for the candidate they think can win the general election even if they agree more with another candidate. In the event of a brokered convention, Paul will need to convince the now-unbound delegates that he is the one candidate who can defeat Barack Obama in November.
To that end, the Paul campaign has repeatedly highlighted polls showing that Paul is indeed a contender in a head-to-head matchup with the sitting President. Most recently, the campaign issued a press release trumpeting the results of a recent survey from Public Policy Polling that showed Romney losing to Obama 48 percent to 44 percent, but Paul leading him 46 percent to 43 percent. With the poll’s margin of error being +/- 3.3 percentage points, that means Obama would defeat Romney, while he and Paul would be statistically tied. The poll also showed that Paul would perform better among independent voters, Hispanic voters, and 18-to-29-year-old voters than any of the other Republican candidates.
“The media may find an inevitability about Romney becoming nominee, but it is clear that with anyone other than Ron Paul as nominee a second term for Obama is the inevitability,” Benton said in the press release.
With a brokered convention still a distinct possibility, the campaign will need to continue to drive home the message that Paul can become the next President of the United States if the Congressman hopes to win the nomination on a second or later ballot. Otherwise, the delegates previously committed to candidates other than Romney may very well hold their noses and cast their votes for the ex-Governor they think will return the White House to Republican hands.
Thursday
Wednesday
WHAT I THINK........UTAH REP. PHIL HART
The apostle Paul wrote at Philippians 2:12 “Work out your own salvation with fear and trembling.”
Embedded in this statement is the idea that each one of us is to have a personal relationship with our Creator. This is implied by the words “Work out your own salvation” In other words, each one of us is responsible for our individual relationship with God.
Those who came to America for religious freedom believed this. It was one of their major points of contention with the religious structure of Old World Europe. In the Old World, the church hierarchy believed that God did not speak directly to an individual person, but instead spoke only through church leadership.
This same mentality played itself out in the Old World political system by way of the Devine Right of Kings. The king would claim he was always right, because he was God’s representative to the nation. How could one argue with that?
The apostle Paul wrote at Colossians 2:10-11 “[You have] put on the new self who is being renewed to a true knowledge according to the image of the One who created him. A renewal in which there is no distinction between Greek and Jew, circumcised and uncircumcised, barbarian, Scythian, slave and freemen, but Christ is all, and in all.” This scripture makes it clear that we are all equal before God.
This spiritual belief of the founders of this nation worked itself out in our purely American political system were each one of us was equal before the law. Each of us has an equal vote in the electoral process.
In the same way, we are to “work out” our own understanding of the American political system. Since we all possess an equal vote to choose our leaders or to vote for any ballot item, we are each equally responsible for the outcome. America has rejected the “Devine right of kings” and instead we hold our leaders to the same standard that applies to each one of us.
And in the American political system, each one of us is entitled to the same “due process” as the next person.
When you realize this, you will quickly conclude that the Patriot Act is wrong! Because the Patriot Act denies due process rights to a certain class of people. When you come to this place in your thinking, the only candidate you can support is Ron Paul.
You will also conclude that the NDAA (National Defense Authorization Act) is wrong! Because the NDAA denies due process rights to a certain class of people. When you realize this, Ron Paul becomes your candidate.
And you will also realize that circumventing the Declaration of War process robs us of the vetting process where we can have a debate of the justness or unjustness of attacking another nation. When we circumvent this national debate, we are more likely to make a mistake and violate the due process rights of innocent people. When you understand this shortcoming of circumventing the Declaration of War process, Ron Paul becomes the only candidate you can support.
The bible speaks about money more than any other topic. Appearing numerous places in scripture is the admonition found at Leviticus 19:36 to have “just weights and measures.”
The money system of the Federal Reserve Bank is based on a fractional reserve model where money is created out of thin air and multiplies faster than weeds. Those who get the money first, the insiders, receive a huge benefit. All the while the rest of us experience a reduction of our purchasing power from the effects of inflation, which effectively steals our wealth.
When you get this figured out, Ron Paul becomes the only candidate you can support.
Ron Paul is the only candidate for president who understands our economy. Ron Paul is the only candidate for president who understands what Constitutional Government is supposed to look like. Ron Paul is the only candidate for president who has a realistic plan to Restore our Republic.
Embedded in this statement is the idea that each one of us is to have a personal relationship with our Creator. This is implied by the words “Work out your own salvation” In other words, each one of us is responsible for our individual relationship with God.
Those who came to America for religious freedom believed this. It was one of their major points of contention with the religious structure of Old World Europe. In the Old World, the church hierarchy believed that God did not speak directly to an individual person, but instead spoke only through church leadership.
This same mentality played itself out in the Old World political system by way of the Devine Right of Kings. The king would claim he was always right, because he was God’s representative to the nation. How could one argue with that?
The apostle Paul wrote at Colossians 2:10-11 “[You have] put on the new self who is being renewed to a true knowledge according to the image of the One who created him. A renewal in which there is no distinction between Greek and Jew, circumcised and uncircumcised, barbarian, Scythian, slave and freemen, but Christ is all, and in all.” This scripture makes it clear that we are all equal before God.
This spiritual belief of the founders of this nation worked itself out in our purely American political system were each one of us was equal before the law. Each of us has an equal vote in the electoral process.
In the same way, we are to “work out” our own understanding of the American political system. Since we all possess an equal vote to choose our leaders or to vote for any ballot item, we are each equally responsible for the outcome. America has rejected the “Devine right of kings” and instead we hold our leaders to the same standard that applies to each one of us.
And in the American political system, each one of us is entitled to the same “due process” as the next person.
When you realize this, you will quickly conclude that the Patriot Act is wrong! Because the Patriot Act denies due process rights to a certain class of people. When you come to this place in your thinking, the only candidate you can support is Ron Paul.
You will also conclude that the NDAA (National Defense Authorization Act) is wrong! Because the NDAA denies due process rights to a certain class of people. When you realize this, Ron Paul becomes your candidate.
And you will also realize that circumventing the Declaration of War process robs us of the vetting process where we can have a debate of the justness or unjustness of attacking another nation. When we circumvent this national debate, we are more likely to make a mistake and violate the due process rights of innocent people. When you understand this shortcoming of circumventing the Declaration of War process, Ron Paul becomes the only candidate you can support.
The bible speaks about money more than any other topic. Appearing numerous places in scripture is the admonition found at Leviticus 19:36 to have “just weights and measures.”
The money system of the Federal Reserve Bank is based on a fractional reserve model where money is created out of thin air and multiplies faster than weeds. Those who get the money first, the insiders, receive a huge benefit. All the while the rest of us experience a reduction of our purchasing power from the effects of inflation, which effectively steals our wealth.
When you get this figured out, Ron Paul becomes the only candidate you can support.
Ron Paul is the only candidate for president who understands our economy. Ron Paul is the only candidate for president who understands what Constitutional Government is supposed to look like. Ron Paul is the only candidate for president who has a realistic plan to Restore our Republic.
WHAT I THINK........UTAH REP. PHIL HART
As I have observed Dr. Paul’s life over the last few decades, I know him to be a friendly gentleman. And as both a medical doctor and a congressman, he is servant of people.
Dr. Paul is also the only member of Congress who has delivered over 4,000 babies. Congressman Ron Paul is 100% pro-life and has never voted for any funding for Planned Parenthood. As a doctor he refused to take Medicare, but when necessary would treat people for free instead.
He is the only veteran in the race. And he is the only candidate for president who advocates the Christian Just War Theory.
He is also a man who has a realistic plan to eliminate 5 cabinet departments of our federal government. A plan to eliminate $1 trillion of the federal budget, and to Restore America to our roots of limited government.
And as I have observed his life over the last 4 years, I see a man who has a passion for justice, an ambassador of free markets, and a champion of liberty. And with an aggressive plan as his to cut the size of government, he has also become a target of many.
What carries Ron Paul forward, against all the criticism of those who do not want to see a Trillion Dollars cut from the federal budget, is his knowledge that unless America makes a hard course correction our future is uncertain.
In 2011, Congress’s approval rating was only 9 percent.
And while Congress is going in the wrong direction, Congressman Paul was earning the nick-name “Dr. No.”
Congressman Paul votes NO on any legislation that is not expressly authorized by the Constitution. He votes No a lot.
He has NEVER voted to raise taxes; He has NEVER voted for an unbalanced budget; He has NEVER voted for a restriction on gun ownership; NEVER voted to raise congressional pay.
Nor has he ever voted to fund the United Nations.
According to a University of Georgia political scientist, Ron Paul had the most conservative voting record of any member of Congress from 1937 to 2002. His future performance as president can be predicted based on his past performance as a Congressman.
In 1775, the military commander of the British forces in Boston, General Gage, wrote a letter to King George. General Gage complained, “I have a nation of lawyers, everyone is a lawyer, they know your statutes better then you know them yourself.”
At that time more copies of Blackstone’s Commentaries on the Laws of England were sold in the Colonies then were sold in England. These colonists knew their rights, they knew the law, and consequently they were willing to fight for their rights.
So it is with those of us who, one by one, become Ron Paul supporters.
In 2008, Ron Paul held a national convention for his Campaign for Liberty at the Target Center in Minneapolis.
There were over 10,000 people in attendance. I was one of them. And when the name of a free market economist was mentioned, names like Fredrick Hyack, Milton Freedman or Ludwig von Misses, the crowd cheered as if Magic Johnson had been in the arena playing basketball.
Oh, and by the way, we booed economist John Maynard Keynes.
Those of us who support Dr. Paul do so because we know Dr. Paul has done the personal study to understand how our economy works, how our monetary system works, and mostly, how our government is supposed to work based on our Constitution.
He is like one of our Founding Fathers who knew all the failures of other systems of government in human history. But they also knew what worked. The same is true for Ron Paul. Congressman Paul knows what works for nations. And he knows what will work for America.
Congressman Paul is the only candidate for President who has a realistic plan to Restore our Republic.
Dr. Paul is also the only member of Congress who has delivered over 4,000 babies. Congressman Ron Paul is 100% pro-life and has never voted for any funding for Planned Parenthood. As a doctor he refused to take Medicare, but when necessary would treat people for free instead.
He is the only veteran in the race. And he is the only candidate for president who advocates the Christian Just War Theory.
He is also a man who has a realistic plan to eliminate 5 cabinet departments of our federal government. A plan to eliminate $1 trillion of the federal budget, and to Restore America to our roots of limited government.
And as I have observed his life over the last 4 years, I see a man who has a passion for justice, an ambassador of free markets, and a champion of liberty. And with an aggressive plan as his to cut the size of government, he has also become a target of many.
What carries Ron Paul forward, against all the criticism of those who do not want to see a Trillion Dollars cut from the federal budget, is his knowledge that unless America makes a hard course correction our future is uncertain.
In 2011, Congress’s approval rating was only 9 percent.
And while Congress is going in the wrong direction, Congressman Paul was earning the nick-name “Dr. No.”
Congressman Paul votes NO on any legislation that is not expressly authorized by the Constitution. He votes No a lot.
He has NEVER voted to raise taxes; He has NEVER voted for an unbalanced budget; He has NEVER voted for a restriction on gun ownership; NEVER voted to raise congressional pay.
Nor has he ever voted to fund the United Nations.
According to a University of Georgia political scientist, Ron Paul had the most conservative voting record of any member of Congress from 1937 to 2002. His future performance as president can be predicted based on his past performance as a Congressman.
In 1775, the military commander of the British forces in Boston, General Gage, wrote a letter to King George. General Gage complained, “I have a nation of lawyers, everyone is a lawyer, they know your statutes better then you know them yourself.”
At that time more copies of Blackstone’s Commentaries on the Laws of England were sold in the Colonies then were sold in England. These colonists knew their rights, they knew the law, and consequently they were willing to fight for their rights.
So it is with those of us who, one by one, become Ron Paul supporters.
In 2008, Ron Paul held a national convention for his Campaign for Liberty at the Target Center in Minneapolis.
There were over 10,000 people in attendance. I was one of them. And when the name of a free market economist was mentioned, names like Fredrick Hyack, Milton Freedman or Ludwig von Misses, the crowd cheered as if Magic Johnson had been in the arena playing basketball.
Oh, and by the way, we booed economist John Maynard Keynes.
Those of us who support Dr. Paul do so because we know Dr. Paul has done the personal study to understand how our economy works, how our monetary system works, and mostly, how our government is supposed to work based on our Constitution.
He is like one of our Founding Fathers who knew all the failures of other systems of government in human history. But they also knew what worked. The same is true for Ron Paul. Congressman Paul knows what works for nations. And he knows what will work for America.
Congressman Paul is the only candidate for President who has a realistic plan to Restore our Republic.
Tuesday
FIST FULL OF EUROS
This week, my congressional committee will hold a hearing to examine how the Federal Reserve bails out European banks, propping up spendthrift European governments in the process. Unfortunately this bailout comes at the expense of American citizens, in the form of higher prices and diminished savings down the road.
A good analysis of the Fed’s “swap” scheme first appeared in the Wall Street Journal back in December, in an article by Gerald O’Driscoll entitled, “The Federal Reserve’s Covert Bailout of Europe.” Essentially, beginning late last year the Fed provided U.S. dollars to the European Central Bank in exchange for Euros-- sometimes as much as $100 billion at a time. The ECB then funneled those dollars to European banks to provide liquidity and prevent crises from bank insolvencies. Since the currency swap was not technically a loan, the Fed did not have to embarrass itself by openly showing foreign bank debt on its balance sheet. The ECB meanwhile did not have to print new Euros and expose the true fragility of big European banks.
The entire purpose of this unholy arrangement was to obscure the truth: namely that the Fed was bailing out Europe with U.S. dollars.
But why is it the business of the Federal Reserve to bail out European banks that find themselves short of dollars to pay their dollar-denominated contracts? After all, those
contracts often were hedges taken to protect banks against weakness of the Euro. Hedges are supposed to reduce risk, but banks that miscalculate should suffer their own losses accordingly. It’s not our business if the ECB chooses to create moral hazards by providing liquidity to European banks, but why should the Fed prop up Europe’s bad decisions!
The Fed has promised to provide unlimited amounts of dollars to the ECB, should circumstances require it. It boggles the mind. Of course when Fed officials first entered into these swap agreements with the ECB last September, they did so quietly. The American public only found out via websites of the ECB, the Bank of England, or the Swiss Central Bank.
The Fed already has pumped trillions of dollars into the economy since 2008, and US banks currently hold $1.5 trillion of excess reserves. So why don't American banks lend those excess trillions to European banks if they really need dollars? If US banks could earn 1 or 2 percent on those loans, they might just be interested. But they can't compete with the ½ percent interest rate charged by the Fed to the ECB. That's one glaring example of the harm caused by the Fed's ability to create money and loan it at below-market interest rates.
The Fed argues that these loans will be temporary, merely providing a little boost to get Europe over the hump. But that's what they thought a few years ago when such lines of credit to the ECB were set to expire, only to see the Fed reauthorize them. What happens if the European financial system collapses? Will the Fed be left holding a bunch of worthless Euros? Will the ECB simply shrug and turn over the collateral it received from European banks, maybe in the form of bonds from Ireland, Italy, or Greece? Have the 17 individual central banks backing the ECB pledged their gold holdings as collateral?
The Fed has placed a hundred-billion dollar bet on the future of the Euro, with the strength of the dollar on the line. This is absolutely irresponsible, and directly contrary to market discipline. Let private banks, European or otherwise, take their own risks. Let foreign central banks inflate their own currencies and suffer the consequences. In other words, it’s time to apply market principles to banks and money.
A good analysis of the Fed’s “swap” scheme first appeared in the Wall Street Journal back in December, in an article by Gerald O’Driscoll entitled, “The Federal Reserve’s Covert Bailout of Europe.” Essentially, beginning late last year the Fed provided U.S. dollars to the European Central Bank in exchange for Euros-- sometimes as much as $100 billion at a time. The ECB then funneled those dollars to European banks to provide liquidity and prevent crises from bank insolvencies. Since the currency swap was not technically a loan, the Fed did not have to embarrass itself by openly showing foreign bank debt on its balance sheet. The ECB meanwhile did not have to print new Euros and expose the true fragility of big European banks.
The entire purpose of this unholy arrangement was to obscure the truth: namely that the Fed was bailing out Europe with U.S. dollars.
But why is it the business of the Federal Reserve to bail out European banks that find themselves short of dollars to pay their dollar-denominated contracts? After all, those
contracts often were hedges taken to protect banks against weakness of the Euro. Hedges are supposed to reduce risk, but banks that miscalculate should suffer their own losses accordingly. It’s not our business if the ECB chooses to create moral hazards by providing liquidity to European banks, but why should the Fed prop up Europe’s bad decisions!
The Fed has promised to provide unlimited amounts of dollars to the ECB, should circumstances require it. It boggles the mind. Of course when Fed officials first entered into these swap agreements with the ECB last September, they did so quietly. The American public only found out via websites of the ECB, the Bank of England, or the Swiss Central Bank.
The Fed already has pumped trillions of dollars into the economy since 2008, and US banks currently hold $1.5 trillion of excess reserves. So why don't American banks lend those excess trillions to European banks if they really need dollars? If US banks could earn 1 or 2 percent on those loans, they might just be interested. But they can't compete with the ½ percent interest rate charged by the Fed to the ECB. That's one glaring example of the harm caused by the Fed's ability to create money and loan it at below-market interest rates.
The Fed argues that these loans will be temporary, merely providing a little boost to get Europe over the hump. But that's what they thought a few years ago when such lines of credit to the ECB were set to expire, only to see the Fed reauthorize them. What happens if the European financial system collapses? Will the Fed be left holding a bunch of worthless Euros? Will the ECB simply shrug and turn over the collateral it received from European banks, maybe in the form of bonds from Ireland, Italy, or Greece? Have the 17 individual central banks backing the ECB pledged their gold holdings as collateral?
The Fed has placed a hundred-billion dollar bet on the future of the Euro, with the strength of the dollar on the line. This is absolutely irresponsible, and directly contrary to market discipline. Let private banks, European or otherwise, take their own risks. Let foreign central banks inflate their own currencies and suffer the consequences. In other words, it’s time to apply market principles to banks and money.
Wednesday
WHAT I THINK........ALLEN STEVO
I sat through a sometimes boring and very often disappointing GOP convention last Saturday in Clark County, Nevada.
I heard numerous delegates proclaim that the income tax was necessary and that it was just "really weird" to want to get rid of it.
I heard lots of jeering and booing during discussions on social issues. It descended into uncivil personal attacks and got ugly.
I heard many platitude-filled, inconsistent speeches. During one speech, many delegates lukewarmly cheered a Republican elected official when he contradictorily proclaimed "I am a low tax, reasonable regulation, free market capitalist." Somehow I accurately predicted that the next sentence out of his mouth would not be "Free markets regulate themselves – now that’s reasonable regulation."
I didn’t really like most of what happened at that county convention.
However, there were fantastic shining moments too – like watching Ron Paul supporters 1. showing up so well organized that they wrestled control of the county party from the insiders, 2. playing fun parliamentary tricks with Roberts Rules of Order, and 3. cutting their teeth for the future contests ahead. The meeting was boot camp for the next generation of the state’s liberty activists.
But one moment stood out above all. In Reagan’s big tent Republican Party there was one issue that was unanimously supported. I really do mean unanimously. Not a single hand was raised to vote in opposition, not a jeer rang out through the quiet ballroom, not a hiss, nothing. And believe me when I say that these people really knew how to voice their displeasure. Nothing but utter unanimity on a particular issue, and it’s all thanks to the obstetrician representing the 14th Congressional District of Texas.
Anyone who’s been to such a convention and then watched the succeeding elections take place knows that few politicians care about party platforms, but platforms are nonetheless contentiously battled over. Those battles are a sign of what’s on the minds of activists in a party.
A sentence calling "for a full and public audit of the Federal Reserve Bank" passed through the platform committee. Some 2,000 people were in the room as the lunch break ended making them eligible to vote. I always thought a random collection of 2,000 people couldn’t unanimously agree on anything. All other issue spoken of up until that point in the day certainly showed how unlikely it was that 2,000 people would agree. Calling for a full and public audit of the Fed, they could agree on.
Four years ago saying "audit the Fed" relegated you to the corner of the Republican tent next to Truthers and just a step below Birthers. You were just lumped into the group of people marginalized for a desire to have grievances redressed. "Go along to get along" was de rigueur and demanding that grievances be redressed, a right guaranteed by the First Amendment, was considered unpatriotic and strange. No more. Redressal of grievances seems to be coming back into vogue.
Ron Paul has started a return to sanity – that all aspects of governmental or quasi-governmental units should be audited and not allowed to run unfettered. Reining in the Fed has long been a key plank in Ron Paul’s personal platform. The step after transparent auditing is talking about how and what to cut. Audit the Fed is a start, a no-brainer, and I wonder if anyone other than me noticed what happened – Ron Paul’s key plank passed, and not a single objection could be heard.
The Fed is more significant than we realize. The Fed must be understood. The Fed is not to be trusted. In fact, the Fed, it’s control over the money supply and interest rates, in a system of fractional reserve banking are to blame for the booms and busts of the business cycle. Those sentences logically follow one another as a person investigates the central bank. Three of those four, once considered strange to speak about in polite company have become acceptable.
They’ve perhaps even become "common sense," so common sense that you’d now appear like an idiot to the masses to publicly stand against an audit of the Fed. America is changing. I was lucky enough to be there to see one example of that change occurring, such an important example. We’ve come a long way from freshman congressman Ron Paul being called before a Senate committee for daring to be the lone vote against the funding of the IMF.
The groupthink of statism as "common sense" and its seemingly unconquerable march forward has shifted. Two hundred years from now there will be many bodies of writing looking at when that shift occurred and mine might be among the primary sources referenced – arguing that that shift occurred in Las Vegas at the Orleans on March 10, 2012.
No more fitting scene could be found for such a moment - in this far off outpost of the Austrian school – the Las Vegas desert that Murray Rothbard called home when the East Coast academicians would not have him.
We are baby steps away from hearing popular criticism of the Fed with its control of the money supply and interest rates in a fractional reserve system of banking – the foundational stones of Austrian Business Cycle Theory’s explanation of booms and busts.
We are baby steps away from hearing that debate had among credible participants on a level playing field. That debate would include an Austrian view and some flavor of Keynsian view. Both sides expected to prove themselves, both given a fair shot at explaining their views of how the world works and the role of the Federal Reserve Bank in that process. We are baby steps away from that debate.
We are baby steps away from the masses looking to the remnant for a different explanation of the cause and correction of the booms and busts than that offered by the current prevailing orthodoxy.
Ludwig von Mises, welcome to the mainstream of American politics.
I heard numerous delegates proclaim that the income tax was necessary and that it was just "really weird" to want to get rid of it.
I heard lots of jeering and booing during discussions on social issues. It descended into uncivil personal attacks and got ugly.
I heard many platitude-filled, inconsistent speeches. During one speech, many delegates lukewarmly cheered a Republican elected official when he contradictorily proclaimed "I am a low tax, reasonable regulation, free market capitalist." Somehow I accurately predicted that the next sentence out of his mouth would not be "Free markets regulate themselves – now that’s reasonable regulation."
I didn’t really like most of what happened at that county convention.
However, there were fantastic shining moments too – like watching Ron Paul supporters 1. showing up so well organized that they wrestled control of the county party from the insiders, 2. playing fun parliamentary tricks with Roberts Rules of Order, and 3. cutting their teeth for the future contests ahead. The meeting was boot camp for the next generation of the state’s liberty activists.
But one moment stood out above all. In Reagan’s big tent Republican Party there was one issue that was unanimously supported. I really do mean unanimously. Not a single hand was raised to vote in opposition, not a jeer rang out through the quiet ballroom, not a hiss, nothing. And believe me when I say that these people really knew how to voice their displeasure. Nothing but utter unanimity on a particular issue, and it’s all thanks to the obstetrician representing the 14th Congressional District of Texas.
Anyone who’s been to such a convention and then watched the succeeding elections take place knows that few politicians care about party platforms, but platforms are nonetheless contentiously battled over. Those battles are a sign of what’s on the minds of activists in a party.
A sentence calling "for a full and public audit of the Federal Reserve Bank" passed through the platform committee. Some 2,000 people were in the room as the lunch break ended making them eligible to vote. I always thought a random collection of 2,000 people couldn’t unanimously agree on anything. All other issue spoken of up until that point in the day certainly showed how unlikely it was that 2,000 people would agree. Calling for a full and public audit of the Fed, they could agree on.
Four years ago saying "audit the Fed" relegated you to the corner of the Republican tent next to Truthers and just a step below Birthers. You were just lumped into the group of people marginalized for a desire to have grievances redressed. "Go along to get along" was de rigueur and demanding that grievances be redressed, a right guaranteed by the First Amendment, was considered unpatriotic and strange. No more. Redressal of grievances seems to be coming back into vogue.
Ron Paul has started a return to sanity – that all aspects of governmental or quasi-governmental units should be audited and not allowed to run unfettered. Reining in the Fed has long been a key plank in Ron Paul’s personal platform. The step after transparent auditing is talking about how and what to cut. Audit the Fed is a start, a no-brainer, and I wonder if anyone other than me noticed what happened – Ron Paul’s key plank passed, and not a single objection could be heard.
The Fed is more significant than we realize. The Fed must be understood. The Fed is not to be trusted. In fact, the Fed, it’s control over the money supply and interest rates, in a system of fractional reserve banking are to blame for the booms and busts of the business cycle. Those sentences logically follow one another as a person investigates the central bank. Three of those four, once considered strange to speak about in polite company have become acceptable.
They’ve perhaps even become "common sense," so common sense that you’d now appear like an idiot to the masses to publicly stand against an audit of the Fed. America is changing. I was lucky enough to be there to see one example of that change occurring, such an important example. We’ve come a long way from freshman congressman Ron Paul being called before a Senate committee for daring to be the lone vote against the funding of the IMF.
The groupthink of statism as "common sense" and its seemingly unconquerable march forward has shifted. Two hundred years from now there will be many bodies of writing looking at when that shift occurred and mine might be among the primary sources referenced – arguing that that shift occurred in Las Vegas at the Orleans on March 10, 2012.
No more fitting scene could be found for such a moment - in this far off outpost of the Austrian school – the Las Vegas desert that Murray Rothbard called home when the East Coast academicians would not have him.
We are baby steps away from hearing popular criticism of the Fed with its control of the money supply and interest rates in a fractional reserve system of banking – the foundational stones of Austrian Business Cycle Theory’s explanation of booms and busts.
We are baby steps away from hearing that debate had among credible participants on a level playing field. That debate would include an Austrian view and some flavor of Keynsian view. Both sides expected to prove themselves, both given a fair shot at explaining their views of how the world works and the role of the Federal Reserve Bank in that process. We are baby steps away from that debate.
We are baby steps away from the masses looking to the remnant for a different explanation of the cause and correction of the booms and busts than that offered by the current prevailing orthodoxy.
Ludwig von Mises, welcome to the mainstream of American politics.
Tuesday
DEMOLISHING DUE PROCESS
It is ironic but perhaps sadly appropriate that Attorney General Eric Holder would choose a law school, Northwestern University, to deliver a speech earlier this month in which he demolished what was left of the rule of law in America.
In what history likely will record as a turning point, Attorney General Holder bluntly explained that this administration believes it has the authority to use lethal force against Americans if the President determines them to be a threat to the nation. He tells us that this is not a violation of the due process requirements of our Constitution because the President himself embodies "due process" as he unilaterally determines who is to be targeted. As Holder said, "a careful and thorough executive branch review of the facts in a case amounts to 'due process.'" That means that the administration believes it is the President himself who is to be the judge, jury, and executioner.
As George Washington University Law Professor Jonathan Turley wrote of the Holder speech:
"All the Administration has said is that they closely and faithfully follow their own guidelines — even if their decisions are not subject to judicial review. The fact that they say those guidelines are based on notions of due process is meaningless. They are not a constitutional process of review."
It is particularly bizarre to hear the logic of the administration claiming the right to target its citizens according to some secret selection process, when we justified our attacks against Iraq and Libya because their leaders supposedly were targeting their own citizens! We also now plan a covert war against Syria for the same reason.
I should make it perfectly clear that I believe any individual who is engaging in violence against this country or its citizens should be brought to justice. But as Attorney General Holder himself points out in the same speech, our civilian courts have a very good track record of trying and convicting individuals involved with terrorism against the United States. Our civilian court system, with the guarantee of real due process, judicial review, and a fair trial, is our strength, not a weakness. It is not an impediment to be sidestepped in the push for convictions or assassinations, but rather a process that guarantees that fundamental right to be considered innocent until proven guilty in a court of law.
I am encouraged, however that there appears to be the beginning of a backlash against the administration's authoritarian claims. Just recently I did an interview with conservative radio talk show host Laura Ingraham who expressed grave concern over using these sorts of tactics against Americans using the supposed war on terror as justification. Sadly, many conservative leaders were silent when Republican President George W. Bush laid the groundwork for this administration's lawlessness with the PATRIOT Act, warrantless wiretapping, indefinite detention without trial, and other violations. Similarly, as Professor Turley points out, "Democrats previously demanded the 'torture memos' of the Bush administration that revealed poor legal analysis by Judge Jay Bybee and Professor John Yoo to justify torture. Now, however, Democrats are largely silent in the face of a president claiming the right to unilaterally kill citizens." The misuse of and disregard for our Constitution for partisan political gain is likely one reason the American public holds Congress in such low esteem. Now the stakes are much higher. Congress and the people should finally wake up!
In what history likely will record as a turning point, Attorney General Holder bluntly explained that this administration believes it has the authority to use lethal force against Americans if the President determines them to be a threat to the nation. He tells us that this is not a violation of the due process requirements of our Constitution because the President himself embodies "due process" as he unilaterally determines who is to be targeted. As Holder said, "a careful and thorough executive branch review of the facts in a case amounts to 'due process.'" That means that the administration believes it is the President himself who is to be the judge, jury, and executioner.
As George Washington University Law Professor Jonathan Turley wrote of the Holder speech:
"All the Administration has said is that they closely and faithfully follow their own guidelines — even if their decisions are not subject to judicial review. The fact that they say those guidelines are based on notions of due process is meaningless. They are not a constitutional process of review."
It is particularly bizarre to hear the logic of the administration claiming the right to target its citizens according to some secret selection process, when we justified our attacks against Iraq and Libya because their leaders supposedly were targeting their own citizens! We also now plan a covert war against Syria for the same reason.
I should make it perfectly clear that I believe any individual who is engaging in violence against this country or its citizens should be brought to justice. But as Attorney General Holder himself points out in the same speech, our civilian courts have a very good track record of trying and convicting individuals involved with terrorism against the United States. Our civilian court system, with the guarantee of real due process, judicial review, and a fair trial, is our strength, not a weakness. It is not an impediment to be sidestepped in the push for convictions or assassinations, but rather a process that guarantees that fundamental right to be considered innocent until proven guilty in a court of law.
I am encouraged, however that there appears to be the beginning of a backlash against the administration's authoritarian claims. Just recently I did an interview with conservative radio talk show host Laura Ingraham who expressed grave concern over using these sorts of tactics against Americans using the supposed war on terror as justification. Sadly, many conservative leaders were silent when Republican President George W. Bush laid the groundwork for this administration's lawlessness with the PATRIOT Act, warrantless wiretapping, indefinite detention without trial, and other violations. Similarly, as Professor Turley points out, "Democrats previously demanded the 'torture memos' of the Bush administration that revealed poor legal analysis by Judge Jay Bybee and Professor John Yoo to justify torture. Now, however, Democrats are largely silent in the face of a president claiming the right to unilaterally kill citizens." The misuse of and disregard for our Constitution for partisan political gain is likely one reason the American public holds Congress in such low esteem. Now the stakes are much higher. Congress and the people should finally wake up!
Thursday
WHAT I THINK........JUSTIN RAMANDO
Is Ron Paul running for president in the wrong party?
The results of the GOP primaries, so far, would certainly seem to suggest that. Paul’s support draws heavily from two constituencies one doesn’t normally associate with the Republican party: young voters, who are overwhelmingly independents, and antiwar voters, who tend to be Democrats. He has carried the youth vote and garnered a significant proportion of independents in virtually every contest: more significantly, polls show him beating President Obama in the general election by winning a huge portion of the independent and youth votes. Combined with the anybody-but-Obama vote, Paul’s potential base of support in a two-way race defines the contours of a winning electoral coalition, one that could win him the White House, bring about a major political realignment – and upend the political Establishment in this country.
The problem, for Paul, is that the GOP leadership is implacably opposed to his candidacy: never mind all that nonsense about a Romney-Paul “alliance,” which was just an invention of the “mainstream” media pushed by the Santorum campaign. After all, the Romneyites stole the Maine caucuses right out from under the Paul campaign, and are doing their best to repeat the same fraud in the rest of the caucus states. Some “alliance”!
Three factors have kept Paul from being a real contender: not only the hostility of the leadership and the age demographics of the average Republican primary voter – which is well over 40 – but also the ideological factor. After a decade and more of neoconservative domination, not only of the party but of the conservative movement, the GOP is the War Party. For the Paul campaign, this is fatal. Ron has made his anti-interventionist views the linchpin of his campaign: he never fails to bring up the issue of war and peace, even when discussing some economic or social topic. That’s because he realizes – unlike some “libertarians” – the issue is central to the question of rolling back the power of government to rule our lives.
While Paul regularly invokes the “Old Right” and the legacy of Robert A. Taft and the Taft Republicans, this tradition has been long forgotten by Republican voters – and deliberately buried and disdained by the party’s intellectuals, such as they are, who regularly rail against “isolationism” and hail FDR and Winston Churchill as their chosen icons.
The result is that, after an initial spurt of success – starting out with a respectable showing in Iowa, and placing second in New Hampshire – the Paul campaign has fallen back to its 2008 levels, with Ron rarely breaking 10 percent.
The response of the Paul campaign has been to hunker down and reassure its enthusiastic supporters – and they haven’t lost their enthusiasm, not by a long shot – that they have a strategy. That strategy is to concentrate on getting delegates, rather than winning “beauty contests,” i.e. primaries in which the results don’t determine who gets the delegates. In many states, the process of delegate selection is long and involved, with county, regional, and state-wide conventions being held to determine who gets to go to Tampa. Given the dedication of the Paulians, and their superior organizational skills, the idea is that Ron will get many more delegates than his vote totals in the primaries would indicate, through sheer perseverance.
However, the process hasn’t always worked out that way. The Paulians, having devoted themselves to learning the arcane rules governing delegate selection, and playing by the book, often arrive at these conventions to find that the rule book has been thrown out by the party leadership. Huge fights have broken out at these shindigs, and the going has been pretty rough: when the party leaders arrive to find the hall packed with under-30 Paulians, all waving signs and wearing buttons, suddenly the rules are “revised,” and the Paulian playbook is no longer applicable.
The Paul campaign started out with the odds stacked against it: the GOP leadership and the “mainstream” media both did everything they could to smear, discredit, and discount him and his supporters. This effort failed: Ron emerged from the pack, and went on to create what is arguably the most vital and alive movement this country has seen since the 1960s.
However, the growth and development of the Paulian movement has now reached its limits within the confines of the GOP, like a potted plant whose roots can no longer be contained. Either the plant is put in the ground, or its roots will become so stunted that the plant will wither and die.
In short, the Paulians must make a decision: either break free of the bonds of the GOP, or else face a future of dwindling political fortunes.
Consider the two likeliest scenarios: 1) Romney gains the magic number of 1144 delegates before the Tampa convention, and is declared the winner: i.e. it’s a repeat of the McCain victory in 2008. And we all remember what happened in 2008: Ron was locked out of the convention, and the Paulians held their own well-attended convention down the street. Paul never endorsed McCain (perish the thought!), and the neocon-run McCain campaign managed to run their candidate – and the GOP – into the ground.
Now, however, we are confronted with a quite different prospect: a brokered convention. With no candidate winning the magic number of delegates, the usual nominating convention-as-coronation scenario is thrown out the window, and what the mainstream media and party officials refer to as “chaos” reigns in Tampa. Translation: the convention will revert back to the way these events normally played out in the Good Old Days, before Big Money and Big Media turned them into political Kabuki theater, with the players and the outcome predetermined from the start.
While this prospect is refreshing, and even exciting – as any disruption in our ritualized political process would be – it still doesn’t hold out much hope for the Paul campaign. The reason is because, short of Paul getting the nomination, there is nothing concrete to be gained from a brokered convention.
With Romney in the lead, delegate-wise, a brokered convention will center on efforts by the Not-Romneys to put together a coalition capable of grabbing the nomination away from Mitt. Yet the Paulians are highly unlikely to be a part of this Not-Romney coalition – unless, of course, they ditch their principles and their whole rationale for launching the campaign to begin with. For this would mean voting for an anti-libertarian schmuck, i.e. either Santorum or Gingrich. That, I believe, is never going to happen: if it did, the Paulian movement would immediately implode, given the enormity of the sell-out.
There is, on the other hand, another possibility, and that is allying with the Romneyites against the Santorum and Gingrich camps. Yet, again, we are faced with the question of what concrete rewards the Paulians could expect to gain from such a dark alliance. In my view, a realistic answer to that question is: exactly nothing.
In the view of some Paul campaign officials, however, the answer is not so clear, as this televised interview with campaign manager Jesse Benton demonstrates. Ignore the typically biased and obnoxious demeanor of the interviewer, and focus on Benton’s answers toward the end, when he says a brokered convention could yield all sorts of rewards for the Paul campaign, such as “a cabinet position,” changes in the party platform — and even “the vice-presidency”!
It’s hard to decide whether this kind of speculation is delusional or just a way of reassuring Paul’s supporters that there’s a good reason to keep sending in the campaign contributions and pinning their hopes on making a splash in Tampa. As we all know, however, a stone makes a splash before it sinks to the bottom of the pond….
The idea that Romney is going to offer the vice-presidential nomination to Ron – or his son, Rand, freshly elected to the Senate from Kentucky – is a pipe dream. The party leadership would never allow it, the convention might well rebel (as a way of expressing conservative discontent with the candidate), and – in my opinion – Romney would never offer it in the first place.
As for changes in the party platform [.pdf] – so what? No one pays attention to these documents, not even the candidates, who are not bound by them. A cabinet position would be a paltry prize indeed, and accepting such a deal – handing the nomination to Romney in exchange for, say, making Nick Gillespie the drug czar – or, more likely, making Rand Paul Transportation Secretary – would be a humiliating end to what started out as a noble crusade.
In each case, the price the Paul campaign would have to pay for such ill-gotten “gains” would be so high that the result would be the effective end of the Paulian movement: that’s because the price would be supporting the nominee, i.e. Mitt Romney, with a personal endorsement from Ron. I, for one, can’t imagine him doing that: whenever he’s asked if he would consider supporting the eventual nominee, Paul gives every indication that the answer is no. He explains why in this interview, in which he emphasizes the Republicans’ warmongering as a major reason not to endorse any of them.
Viewed objectively, and with the long-range goals of the Paulians in mind, there is only one road forward for the movement: the third party route.
Running on a third party ticket would give Paul access to the votes of his natural constituency: the young independents disgusted with both parties who yearn for real change – i.e. a revolution – in Washington. It would give the Old Right remnant in the GOP, which Paul has reawakened from its long sleep, a place to go in November, while also making room for independents, antiwar voters, civil libertarians, disillusioned Obamaites, and other constituencies unlikely to be caught dead voting in a Republican primary.
Polls indicate Paul would get anywhere from 18 percent to 21 percent running as a third party candidate, and the percentage seem to be climbing as the actual election draws nearer. These same polls indicate he would draw two-thirds of his votes from the Republican column, but I don’t think these “drill-down” analyses hold much water: what they leave out is non-voters, new voters, and – most important of all – future events. If the US starts bombing Iran before election day, or, say, we have another economic meltdown, as we did in the winter of 2008, then all bets are off – and the prospect of a Paul victory becomes more than mere wishful thinking.
A Paul third party candidacy would not only open up a prospect that, right now, seems highly unlikely if not impossible – i.e. Ron Paul sitting in the Oval Office – it would also place significant constraints on the other candidates, including President Obama. Faced only with a warmongering Republican, Obama can pretty much do whatever he likes when it comes to provoking, sanctioning, and threatening Iran: after all, antiwar voters have nowhere else to go. With Paul in the race, however, Obama is going to have to be very careful not to lose his left-ish antiwar constituency, which has so far stuck with him as the lesser to the two evils. If and when Obama makes his move against Iran, Paul’s third party campaign will be right there, scarfing up votes from the President’s disillusioned and angry former supporters.
Indeed, the ultimate effect of a Paulian third party ticket could well be preventing the outbreak of a major war in the Middle East. This, it seems to me, is a factor the Paul campaign is going to have to weigh in the balance as it considers its options. In terms of the Paulians’ own principles – especially their characteristic opposition to wars of aggression on moral grounds – this is a powerful argument for launching a third party campaign.
We don’t endorse candidates here at Antiwar.com, and for a very good reason: we’re a journalistic enterprise, not a political organization, and we don’t take orders from any party central committee or faction. Nor do we give a blank check to any politician – no, not even Ron Paul. There can be little doubt, however, that the Paul campaign has had a tremendous effect on the antiwar movement in this country, with several longtime peace campaigners taking up Paul’s cause. He has become a symbol of the anti-interventionist impulse in modern American politics, and his political fate is bound up to a large extent with the fate of the antiwar movement – and the prospects for peace in the 21st century.
He has moved the discourse forward, challenging the premises of the interventionists at every turn and upholding a consistent vision of a republic that respects the sovereignty of all and seeks to lead by example rather than by force. If his voice is stilled after the Tampa convention, American voters will be left with a “choice” of an outright warmonger in Republican clothing versus our somewhat less overtly belligerent albeit no less interventionist sitting President, whose foreign policy record is worse than his predecessor’s.
Ron Paul’s last hurrah cannot – must not — be a “deal” made in Tampa, and I’d be willing to bet the ranch no such deal will be forthcoming. Speaking as a political analyst, and not a partisan, I would venture to say the Paulian movement will peter out and come to nothing if it stays locked within a Republican straitjacket. Liberated from their partisan constraints, Paul’s supporters will be spared the Long March through the GOP apparatus, and instead of wasting their time running for county central committee they’ll be freed up to make the case for peace directly to the American people.
What course the Paul campaign takes in the next few weeks will determine the nature of his political legacy. If it ends in Tampa, then the fate of the Paulian movement will be reflected in this bit of verse from the poet Robinson Jeffers, whose fierce “isolationism” caused him to be exiled from polite “liberal” circles in the run up to World War II:
“While this America settles in the mould of its vulgarity, heavily thickening to empire
“And protest, only a bubble in the molten mass, pops and sighs out, and the mass hardens,
“I sadly smiling remember that the flower fades to make fruit, the fruit rots to make earth.”
Paul has often been asked if he’d run as a third party candidate, and he always gives the same ambiguous answer – and that was necessary, at the time, and proper. However, the moment is fast approaching when ambiguity on this matter becomes increasingly counterproductive, as far as advancing the cause of peace and liberty is concerned.
In politics, timing is everything. Before the movement he created passes the apex of its influence in the GOP and begins to lose its relevance, the candidate and the campaign must stop at this crossroads and contemplate their ultimate direction. The hour of decision has arrived.
NOTES IN THE MARGIN
I would note, for my readers’ information, that this decision cannot wait until the Tampa convention this summer: the most likely vehicle for a Paul third party run, the Libertarian Party, holds its nominating convention at the beginning of May. While it seems likely the LP nomination is Paul’s if he seeks it, the reality is that Paul’s hour of decision will arrive a lot sooner than late August, when the Tampa convention is scheduled to take place. An alternative would be to run on the Constitution Party ticket, which has ballot status in many states: however, the baggage this particular political formation carries may well be a burden the Paulians will wind up wishing they didn’t have to carry. There’s always the course of launching an independent ticket from scratch, but that would be costly and prone to disruption by Republican operatives. Remember how the Democrats followed the Naderites from state to state, mounting harassing lawsuits and keeping Nader off the ballot in several instances? The GOP would no doubt launch a similar operation directed at Paul.
The results of the GOP primaries, so far, would certainly seem to suggest that. Paul’s support draws heavily from two constituencies one doesn’t normally associate with the Republican party: young voters, who are overwhelmingly independents, and antiwar voters, who tend to be Democrats. He has carried the youth vote and garnered a significant proportion of independents in virtually every contest: more significantly, polls show him beating President Obama in the general election by winning a huge portion of the independent and youth votes. Combined with the anybody-but-Obama vote, Paul’s potential base of support in a two-way race defines the contours of a winning electoral coalition, one that could win him the White House, bring about a major political realignment – and upend the political Establishment in this country.
The problem, for Paul, is that the GOP leadership is implacably opposed to his candidacy: never mind all that nonsense about a Romney-Paul “alliance,” which was just an invention of the “mainstream” media pushed by the Santorum campaign. After all, the Romneyites stole the Maine caucuses right out from under the Paul campaign, and are doing their best to repeat the same fraud in the rest of the caucus states. Some “alliance”!
Three factors have kept Paul from being a real contender: not only the hostility of the leadership and the age demographics of the average Republican primary voter – which is well over 40 – but also the ideological factor. After a decade and more of neoconservative domination, not only of the party but of the conservative movement, the GOP is the War Party. For the Paul campaign, this is fatal. Ron has made his anti-interventionist views the linchpin of his campaign: he never fails to bring up the issue of war and peace, even when discussing some economic or social topic. That’s because he realizes – unlike some “libertarians” – the issue is central to the question of rolling back the power of government to rule our lives.
While Paul regularly invokes the “Old Right” and the legacy of Robert A. Taft and the Taft Republicans, this tradition has been long forgotten by Republican voters – and deliberately buried and disdained by the party’s intellectuals, such as they are, who regularly rail against “isolationism” and hail FDR and Winston Churchill as their chosen icons.
The result is that, after an initial spurt of success – starting out with a respectable showing in Iowa, and placing second in New Hampshire – the Paul campaign has fallen back to its 2008 levels, with Ron rarely breaking 10 percent.
The response of the Paul campaign has been to hunker down and reassure its enthusiastic supporters – and they haven’t lost their enthusiasm, not by a long shot – that they have a strategy. That strategy is to concentrate on getting delegates, rather than winning “beauty contests,” i.e. primaries in which the results don’t determine who gets the delegates. In many states, the process of delegate selection is long and involved, with county, regional, and state-wide conventions being held to determine who gets to go to Tampa. Given the dedication of the Paulians, and their superior organizational skills, the idea is that Ron will get many more delegates than his vote totals in the primaries would indicate, through sheer perseverance.
However, the process hasn’t always worked out that way. The Paulians, having devoted themselves to learning the arcane rules governing delegate selection, and playing by the book, often arrive at these conventions to find that the rule book has been thrown out by the party leadership. Huge fights have broken out at these shindigs, and the going has been pretty rough: when the party leaders arrive to find the hall packed with under-30 Paulians, all waving signs and wearing buttons, suddenly the rules are “revised,” and the Paulian playbook is no longer applicable.
The Paul campaign started out with the odds stacked against it: the GOP leadership and the “mainstream” media both did everything they could to smear, discredit, and discount him and his supporters. This effort failed: Ron emerged from the pack, and went on to create what is arguably the most vital and alive movement this country has seen since the 1960s.
However, the growth and development of the Paulian movement has now reached its limits within the confines of the GOP, like a potted plant whose roots can no longer be contained. Either the plant is put in the ground, or its roots will become so stunted that the plant will wither and die.
In short, the Paulians must make a decision: either break free of the bonds of the GOP, or else face a future of dwindling political fortunes.
Consider the two likeliest scenarios: 1) Romney gains the magic number of 1144 delegates before the Tampa convention, and is declared the winner: i.e. it’s a repeat of the McCain victory in 2008. And we all remember what happened in 2008: Ron was locked out of the convention, and the Paulians held their own well-attended convention down the street. Paul never endorsed McCain (perish the thought!), and the neocon-run McCain campaign managed to run their candidate – and the GOP – into the ground.
Now, however, we are confronted with a quite different prospect: a brokered convention. With no candidate winning the magic number of delegates, the usual nominating convention-as-coronation scenario is thrown out the window, and what the mainstream media and party officials refer to as “chaos” reigns in Tampa. Translation: the convention will revert back to the way these events normally played out in the Good Old Days, before Big Money and Big Media turned them into political Kabuki theater, with the players and the outcome predetermined from the start.
While this prospect is refreshing, and even exciting – as any disruption in our ritualized political process would be – it still doesn’t hold out much hope for the Paul campaign. The reason is because, short of Paul getting the nomination, there is nothing concrete to be gained from a brokered convention.
With Romney in the lead, delegate-wise, a brokered convention will center on efforts by the Not-Romneys to put together a coalition capable of grabbing the nomination away from Mitt. Yet the Paulians are highly unlikely to be a part of this Not-Romney coalition – unless, of course, they ditch their principles and their whole rationale for launching the campaign to begin with. For this would mean voting for an anti-libertarian schmuck, i.e. either Santorum or Gingrich. That, I believe, is never going to happen: if it did, the Paulian movement would immediately implode, given the enormity of the sell-out.
There is, on the other hand, another possibility, and that is allying with the Romneyites against the Santorum and Gingrich camps. Yet, again, we are faced with the question of what concrete rewards the Paulians could expect to gain from such a dark alliance. In my view, a realistic answer to that question is: exactly nothing.
In the view of some Paul campaign officials, however, the answer is not so clear, as this televised interview with campaign manager Jesse Benton demonstrates. Ignore the typically biased and obnoxious demeanor of the interviewer, and focus on Benton’s answers toward the end, when he says a brokered convention could yield all sorts of rewards for the Paul campaign, such as “a cabinet position,” changes in the party platform — and even “the vice-presidency”!
It’s hard to decide whether this kind of speculation is delusional or just a way of reassuring Paul’s supporters that there’s a good reason to keep sending in the campaign contributions and pinning their hopes on making a splash in Tampa. As we all know, however, a stone makes a splash before it sinks to the bottom of the pond….
The idea that Romney is going to offer the vice-presidential nomination to Ron – or his son, Rand, freshly elected to the Senate from Kentucky – is a pipe dream. The party leadership would never allow it, the convention might well rebel (as a way of expressing conservative discontent with the candidate), and – in my opinion – Romney would never offer it in the first place.
As for changes in the party platform [.pdf] – so what? No one pays attention to these documents, not even the candidates, who are not bound by them. A cabinet position would be a paltry prize indeed, and accepting such a deal – handing the nomination to Romney in exchange for, say, making Nick Gillespie the drug czar – or, more likely, making Rand Paul Transportation Secretary – would be a humiliating end to what started out as a noble crusade.
In each case, the price the Paul campaign would have to pay for such ill-gotten “gains” would be so high that the result would be the effective end of the Paulian movement: that’s because the price would be supporting the nominee, i.e. Mitt Romney, with a personal endorsement from Ron. I, for one, can’t imagine him doing that: whenever he’s asked if he would consider supporting the eventual nominee, Paul gives every indication that the answer is no. He explains why in this interview, in which he emphasizes the Republicans’ warmongering as a major reason not to endorse any of them.
Viewed objectively, and with the long-range goals of the Paulians in mind, there is only one road forward for the movement: the third party route.
Running on a third party ticket would give Paul access to the votes of his natural constituency: the young independents disgusted with both parties who yearn for real change – i.e. a revolution – in Washington. It would give the Old Right remnant in the GOP, which Paul has reawakened from its long sleep, a place to go in November, while also making room for independents, antiwar voters, civil libertarians, disillusioned Obamaites, and other constituencies unlikely to be caught dead voting in a Republican primary.
Polls indicate Paul would get anywhere from 18 percent to 21 percent running as a third party candidate, and the percentage seem to be climbing as the actual election draws nearer. These same polls indicate he would draw two-thirds of his votes from the Republican column, but I don’t think these “drill-down” analyses hold much water: what they leave out is non-voters, new voters, and – most important of all – future events. If the US starts bombing Iran before election day, or, say, we have another economic meltdown, as we did in the winter of 2008, then all bets are off – and the prospect of a Paul victory becomes more than mere wishful thinking.
A Paul third party candidacy would not only open up a prospect that, right now, seems highly unlikely if not impossible – i.e. Ron Paul sitting in the Oval Office – it would also place significant constraints on the other candidates, including President Obama. Faced only with a warmongering Republican, Obama can pretty much do whatever he likes when it comes to provoking, sanctioning, and threatening Iran: after all, antiwar voters have nowhere else to go. With Paul in the race, however, Obama is going to have to be very careful not to lose his left-ish antiwar constituency, which has so far stuck with him as the lesser to the two evils. If and when Obama makes his move against Iran, Paul’s third party campaign will be right there, scarfing up votes from the President’s disillusioned and angry former supporters.
Indeed, the ultimate effect of a Paulian third party ticket could well be preventing the outbreak of a major war in the Middle East. This, it seems to me, is a factor the Paul campaign is going to have to weigh in the balance as it considers its options. In terms of the Paulians’ own principles – especially their characteristic opposition to wars of aggression on moral grounds – this is a powerful argument for launching a third party campaign.
We don’t endorse candidates here at Antiwar.com, and for a very good reason: we’re a journalistic enterprise, not a political organization, and we don’t take orders from any party central committee or faction. Nor do we give a blank check to any politician – no, not even Ron Paul. There can be little doubt, however, that the Paul campaign has had a tremendous effect on the antiwar movement in this country, with several longtime peace campaigners taking up Paul’s cause. He has become a symbol of the anti-interventionist impulse in modern American politics, and his political fate is bound up to a large extent with the fate of the antiwar movement – and the prospects for peace in the 21st century.
He has moved the discourse forward, challenging the premises of the interventionists at every turn and upholding a consistent vision of a republic that respects the sovereignty of all and seeks to lead by example rather than by force. If his voice is stilled after the Tampa convention, American voters will be left with a “choice” of an outright warmonger in Republican clothing versus our somewhat less overtly belligerent albeit no less interventionist sitting President, whose foreign policy record is worse than his predecessor’s.
Ron Paul’s last hurrah cannot – must not — be a “deal” made in Tampa, and I’d be willing to bet the ranch no such deal will be forthcoming. Speaking as a political analyst, and not a partisan, I would venture to say the Paulian movement will peter out and come to nothing if it stays locked within a Republican straitjacket. Liberated from their partisan constraints, Paul’s supporters will be spared the Long March through the GOP apparatus, and instead of wasting their time running for county central committee they’ll be freed up to make the case for peace directly to the American people.
What course the Paul campaign takes in the next few weeks will determine the nature of his political legacy. If it ends in Tampa, then the fate of the Paulian movement will be reflected in this bit of verse from the poet Robinson Jeffers, whose fierce “isolationism” caused him to be exiled from polite “liberal” circles in the run up to World War II:
“While this America settles in the mould of its vulgarity, heavily thickening to empire
“And protest, only a bubble in the molten mass, pops and sighs out, and the mass hardens,
“I sadly smiling remember that the flower fades to make fruit, the fruit rots to make earth.”
Paul has often been asked if he’d run as a third party candidate, and he always gives the same ambiguous answer – and that was necessary, at the time, and proper. However, the moment is fast approaching when ambiguity on this matter becomes increasingly counterproductive, as far as advancing the cause of peace and liberty is concerned.
In politics, timing is everything. Before the movement he created passes the apex of its influence in the GOP and begins to lose its relevance, the candidate and the campaign must stop at this crossroads and contemplate their ultimate direction. The hour of decision has arrived.
NOTES IN THE MARGIN
I would note, for my readers’ information, that this decision cannot wait until the Tampa convention this summer: the most likely vehicle for a Paul third party run, the Libertarian Party, holds its nominating convention at the beginning of May. While it seems likely the LP nomination is Paul’s if he seeks it, the reality is that Paul’s hour of decision will arrive a lot sooner than late August, when the Tampa convention is scheduled to take place. An alternative would be to run on the Constitution Party ticket, which has ballot status in many states: however, the baggage this particular political formation carries may well be a burden the Paulians will wind up wishing they didn’t have to carry. There’s always the course of launching an independent ticket from scratch, but that would be costly and prone to disruption by Republican operatives. Remember how the Democrats followed the Naderites from state to state, mounting harassing lawsuits and keeping Nader off the ballot in several instances? The GOP would no doubt launch a similar operation directed at Paul.
Tuesday
AN ADMINISTRATION GONE ROGUE
Have certain parts of the Constitution become irrelevant, as a former Republican leader once told me at a Foreign Affairs Committee hearing? At the time, I was told that demanding a Congressional declaration of war before invading Iraq, as Article I Section 8 of the Constitution requires, was unnecessary and anachronistic. Congress and the president then proceeded without a Constitutional declaration and the disastrous Iraq invasion was the result.
Last week, Obama administration officials made it clear that even the fig leaf of Congressional participation provided by the 2003 "authorization" to use force in Iraq was to be ignored as well. In a hearing before the Senate Armed Services Committee, Defense Secretary Leon Panetta stated clearly and repeatedly that the administration felt it was legally justified to use military force against Syria solely with "international permission". Such "international permission" could come by way of the United Nations, NATO, or some other international body. Secretary Panetta then told Senator Sessions that depending on the situation, the administration would consider informing Congress of its decision and might even seek authorization after the fact.
While Senator Sessions expressed surprise at the casual audacity of Panetta in making this statement, in reality his was just a bluntly stated explanation of what has been, de facto, the case for many years. When President Obama committed the US military to a pre-emptive war against Libya last year, for example, Congress was kept completely out of the process. Likewise, military action in Iraq, Pakistan, Somalia, Yemen, and so on, proceed without a Congressional declaration. In fact, we haven't had a proper, constitutional declaration of war since 1942, yet the US military has been engaged in Korea, Lebanon, Iraq, Bosnia, Liberia, Haiti, and Libya with only UN resolutions as the authority. Congress's only role has been authorizing funds, which it always does without question, because one must "support the troops".
Of course we should reserve our harshest criticism for Congress rather than the Administration. If the people's branch of government abrogates its Constitutional authority to the Executive branch, who is to blame? Who is to blame that Congress as a body will not stand up and demand that the president treat the Constitution as more than an anachronistic piece of paper, or merely a set of aspirations and guidelines? The Constitution is the law of the land and for Congress to allow it to be flouted speaks as badly about Congress as it does about a president who seeks to do the flouting.
Just last week the administration announced that it would begin providing material support to the rebels who seek to overthrow the Syrian government. Was Congress involved in this decision to take sides in what may develop into a full-fledged civil war? And what of reports that US special forces may already be operating inside Syria? Still, Congress sits silently as its authority is undermined. Does anybody really wonder why approval numbers for Congress are so low?
Many of my colleagues who stood by as then-President Bush used the military as a kind of king's army are now calling for Congress to act against this president for openly admitting that is his intent. I agree it is time for Congressional action in response to these attacks on our Constitution, but the solution is simple and Constitutional. The solution is simply voting to withhold funds, since Congress has the power of the purse. No money for undeclared wars!
Last week, Obama administration officials made it clear that even the fig leaf of Congressional participation provided by the 2003 "authorization" to use force in Iraq was to be ignored as well. In a hearing before the Senate Armed Services Committee, Defense Secretary Leon Panetta stated clearly and repeatedly that the administration felt it was legally justified to use military force against Syria solely with "international permission". Such "international permission" could come by way of the United Nations, NATO, or some other international body. Secretary Panetta then told Senator Sessions that depending on the situation, the administration would consider informing Congress of its decision and might even seek authorization after the fact.
While Senator Sessions expressed surprise at the casual audacity of Panetta in making this statement, in reality his was just a bluntly stated explanation of what has been, de facto, the case for many years. When President Obama committed the US military to a pre-emptive war against Libya last year, for example, Congress was kept completely out of the process. Likewise, military action in Iraq, Pakistan, Somalia, Yemen, and so on, proceed without a Congressional declaration. In fact, we haven't had a proper, constitutional declaration of war since 1942, yet the US military has been engaged in Korea, Lebanon, Iraq, Bosnia, Liberia, Haiti, and Libya with only UN resolutions as the authority. Congress's only role has been authorizing funds, which it always does without question, because one must "support the troops".
Of course we should reserve our harshest criticism for Congress rather than the Administration. If the people's branch of government abrogates its Constitutional authority to the Executive branch, who is to blame? Who is to blame that Congress as a body will not stand up and demand that the president treat the Constitution as more than an anachronistic piece of paper, or merely a set of aspirations and guidelines? The Constitution is the law of the land and for Congress to allow it to be flouted speaks as badly about Congress as it does about a president who seeks to do the flouting.
Just last week the administration announced that it would begin providing material support to the rebels who seek to overthrow the Syrian government. Was Congress involved in this decision to take sides in what may develop into a full-fledged civil war? And what of reports that US special forces may already be operating inside Syria? Still, Congress sits silently as its authority is undermined. Does anybody really wonder why approval numbers for Congress are so low?
Many of my colleagues who stood by as then-President Bush used the military as a kind of king's army are now calling for Congress to act against this president for openly admitting that is his intent. I agree it is time for Congressional action in response to these attacks on our Constitution, but the solution is simple and Constitutional. The solution is simply voting to withhold funds, since Congress has the power of the purse. No money for undeclared wars!
Monday
FED UP WITH THE FED
While the Fed has recently released an unprecedented amount of information on its activities, there is still much that remains unknown. Predictably, every push towards transparency has been fought tooth and nail. It took disclosure requirements enacted within the Dodd-Frank Act to get the Fed to provide data on its emergency lending facilities. It took lawsuits filed by Bloomberg and Fox News to provide data on discount window lending during the worst parts of the financial crisis. And it will take further concerted action on the part of Congress, the media, and the public to keep up pressure on the Fed to become and remain transparent.
Transparency is not a panacea, however, as a fully transparent organization is still capable of engaging in all sorts of mischief. Ironically, one of the Fed's more egregious recent actions, adopting an explicit inflation target, was hailed by many as another wonderful example of transparency. Yet if you think about what this 2% inflation target actually is, you realize that it is an explicit policy to devalue the dollar and reduce its purchasing power. And it adds up quickly over time. Two percent annual price inflation means that prices rise 22% within a decade, and nearly 50% within two decades.
It is worse than that, however. This explicit 2% target also fails to take into account that whatever measure is used to determine price inflation, be it CPI, core CPI, PCE, etc., will always be chosen with an eye towards underreporting the true rate of inflation and price rises. Pressure will be exerted on those calculating the price indices, so as not to alarm the public when prices begin to accelerate.
Of course, government officials claim that price increases do not affect the average American because they can always substitute hamburger for steak, or have cereal instead of bacon to protect their family budget as prices rise. But the American people don't overlook the fact that their quality of life has suffered because of the Federal Reserve and price inflation. What will they substitute when hamburger and cereal go sky high?
The Federal Reserve continues to keep interest rates low in the hopes of boosting lending and consumption. But keeping interest rates at zero discourages saving. Why stick money in a savings account earning 0.05% if it is guaranteed to lose at least 2% every year? The Federal Reserve created the largest debt bubble the world has ever known with these sorts of policies. The extended zero interest rate policy only eviscerates thrift and savings—the true building blocks of prosperity. Capital will continue to be depleted, infrastructure will fall into disrepair, and the United States will be a mere shadow of its former self.
It is well past time to end the failed monetary policy that encourages this mistaken preference for cheap money now, rather than real wealth in the long run. Transparency and a full audit of the Federal Reserve is a start and something we must continue to pursue. And, if those in power don't have the stomach to bring the Fed out into full daylight, the American people deserve at least the right to conduct their economic transactions in the medium of exchange of their choosing.
Transparency is not a panacea, however, as a fully transparent organization is still capable of engaging in all sorts of mischief. Ironically, one of the Fed's more egregious recent actions, adopting an explicit inflation target, was hailed by many as another wonderful example of transparency. Yet if you think about what this 2% inflation target actually is, you realize that it is an explicit policy to devalue the dollar and reduce its purchasing power. And it adds up quickly over time. Two percent annual price inflation means that prices rise 22% within a decade, and nearly 50% within two decades.
It is worse than that, however. This explicit 2% target also fails to take into account that whatever measure is used to determine price inflation, be it CPI, core CPI, PCE, etc., will always be chosen with an eye towards underreporting the true rate of inflation and price rises. Pressure will be exerted on those calculating the price indices, so as not to alarm the public when prices begin to accelerate.
Of course, government officials claim that price increases do not affect the average American because they can always substitute hamburger for steak, or have cereal instead of bacon to protect their family budget as prices rise. But the American people don't overlook the fact that their quality of life has suffered because of the Federal Reserve and price inflation. What will they substitute when hamburger and cereal go sky high?
The Federal Reserve continues to keep interest rates low in the hopes of boosting lending and consumption. But keeping interest rates at zero discourages saving. Why stick money in a savings account earning 0.05% if it is guaranteed to lose at least 2% every year? The Federal Reserve created the largest debt bubble the world has ever known with these sorts of policies. The extended zero interest rate policy only eviscerates thrift and savings—the true building blocks of prosperity. Capital will continue to be depleted, infrastructure will fall into disrepair, and the United States will be a mere shadow of its former self.
It is well past time to end the failed monetary policy that encourages this mistaken preference for cheap money now, rather than real wealth in the long run. Transparency and a full audit of the Federal Reserve is a start and something we must continue to pursue. And, if those in power don't have the stomach to bring the Fed out into full daylight, the American people deserve at least the right to conduct their economic transactions in the medium of exchange of their choosing.
Friday
ECONOMY SQUEEZED AS DEBT ACCELERATES
Senator Jeff Sessions, ranking member of the Senate Budget Committee has pointed out that our per capita government debt is already larger than Greece's. Per person, our government owes over $49,000 compared to $38,937 per Greek citizen. Our debt has just reached 101% of our Gross Domestic Product. Our creditors see this and have quietly slowed down or stopped their lending to us. As a result, the Federal Reserve has been outright monetizing debt as a way to patch things together and keep the economy on life support a little longer. There is rapidly shrinking demand for our debt, and confidence in the dollar is falling. This phenomenon is hidden only by the fact that confidence in all other fiat currencies is falling faster.
None of this seems to really alarm the administration, obviously, as they have just released a budget that accelerates spending and borrowing. The reason the debt and deficits plague the economy, according to this administration, is that the American economy is not taxed enough. Therefore, hidden in the fine print of the budget is a provision that ramps up the corporate dividends tax rate from its current 15% to 39.6%. In addition, certain deductions and exemptions will be phased out; an additional 3.8% Obamacare investment tax surcharge will be tacked on, bringing the effective dividend tax rate to 44.8% in 2013. Keep in mind, this is not just a tax on big business, this is a tax on anyone who depends on dividend income to live - retirees will be hit hard by these changes and dividend yielding stock prices will adjust downward rapidly to reflect their decreased value.
Not only this, but the Obama administration is worsening the uniquely American policy of taxing income of US based companies earned overseas. No other country presumes to tax globally in this manner, so it amounts to a huge penalty for basing a company in the US. Companies have been able to manage this penalty by deferring taxation until it is repatriated or by paying dividends. What will happen to US based businesses with strong international ties if these allowances are abolished as the Obama administration proposes? A massive wave of permanent capital flight will undoubtedly cause the already high levels of unemployment to rise.
Businesses are struggling and failing in this economy. The government ultimately depends on a healthy business climate to provide jobs and a tax base. It is penny wise and pound foolish to add to business tax burden in a misguided attempt to close the colossal gap between our government's revenue and spending. Rather than crippling and absorbing more of our shrinking economy, government needs to be drastically cut - not in 10 years, but immediately.
Those who understand the underpinnings of the dollar and how the Federal Reserve works have known for some time that we are on an unsustainable course, that major chaos is in store if nothing is done quickly to reform things. Politicians pay lip-service to reforms that never materialize or turn out to be at best small and meaningless, or at worst actively harmful. It seems more and more inevitable that because the necessary changes would be too inconvenient for the elites to enact now, we will get them later Greek-style, through collapse and chaos.
None of this seems to really alarm the administration, obviously, as they have just released a budget that accelerates spending and borrowing. The reason the debt and deficits plague the economy, according to this administration, is that the American economy is not taxed enough. Therefore, hidden in the fine print of the budget is a provision that ramps up the corporate dividends tax rate from its current 15% to 39.6%. In addition, certain deductions and exemptions will be phased out; an additional 3.8% Obamacare investment tax surcharge will be tacked on, bringing the effective dividend tax rate to 44.8% in 2013. Keep in mind, this is not just a tax on big business, this is a tax on anyone who depends on dividend income to live - retirees will be hit hard by these changes and dividend yielding stock prices will adjust downward rapidly to reflect their decreased value.
Not only this, but the Obama administration is worsening the uniquely American policy of taxing income of US based companies earned overseas. No other country presumes to tax globally in this manner, so it amounts to a huge penalty for basing a company in the US. Companies have been able to manage this penalty by deferring taxation until it is repatriated or by paying dividends. What will happen to US based businesses with strong international ties if these allowances are abolished as the Obama administration proposes? A massive wave of permanent capital flight will undoubtedly cause the already high levels of unemployment to rise.
Businesses are struggling and failing in this economy. The government ultimately depends on a healthy business climate to provide jobs and a tax base. It is penny wise and pound foolish to add to business tax burden in a misguided attempt to close the colossal gap between our government's revenue and spending. Rather than crippling and absorbing more of our shrinking economy, government needs to be drastically cut - not in 10 years, but immediately.
Those who understand the underpinnings of the dollar and how the Federal Reserve works have known for some time that we are on an unsustainable course, that major chaos is in store if nothing is done quickly to reform things. Politicians pay lip-service to reforms that never materialize or turn out to be at best small and meaningless, or at worst actively harmful. It seems more and more inevitable that because the necessary changes would be too inconvenient for the elites to enact now, we will get them later Greek-style, through collapse and chaos.
WHAT I THINK........ALLEN STEVO
It’s long been understood in U.S. politics that the one who wins an election is the one who has the power to treat Americans like total garbage while enriching his buddies. On the other hand, the one who wins the election could do something entirely different from what presidents for years have done. The one who wins the election could wind up being a guiding figure as we Americans tear down the system that is slowly enslaving us. That’s what we hope for. That’s what we work for. If we work tirelessly and effectively, that’s what we’ll achieve.
I write this not for the folks who are opposed to political participation, but for those who recognize the importance of political participation. Working half-heartedly or ineffectively in these times that so matter is simply not enough, because victory is so close for a candidate who is so threatening to the forces that oppose freedom.
What Ron Paul threatens to do is to take the free meal ticket from many men and women who currently depend on government’s corrupt corporate "welfare" in order to live well. There are lots of people who need Ron Paul to lose, because they see that their livelihoods depend on it. Simply sharing links on Facebook and getting into online debates will do little to make Ron Paul president; in fact, the powers that be would love to see Ron Paul’s proponents stay online "where they belong" or just coming outside every once in a while to wave signs. Those actions are entirely ineffective in winning a campaign. Do them and you are just as bad as any neo-con – because you have a chance to effectively fight for liberty, yet you do nothing. Your silence, your comfortable obeisance in your day-to-day life, only strengthens the existing system. You spend your day strengthening that system, just like a neo-con. In fact, I’d say you’re even worse than a neo-con, because a neo-con doesn’t get it. A neo-con isn’t wasting the opportunities to destroy the shackles, because he doesn’t feel the shackles. You who feel those shackles, yet do nothing effective in response to them – you are villains in this story.
The first day this spring when Ron Paul loses an online poll is the day that I know the movement has refocused its attention on something better – winning a race instead of acting like we’ve already won a race. Rejoicing about our strength and our numbers is exactly that – acting like we’ve won a race. We have no reason for gloating, yet so many Ron Paul supporters gloat. We have not won the race.
We can do this. We can win this election. America is ready for us to step up and lead. If we don’t, if we can’t capture the nomination and then the presidency, well, we are losers. We are pathetic. We had the most beautiful possible chance in our hands – a peaceful revolution – and we blew it. I’m 32 years old. I know that in the next 12 months, the people of this age will earn one of two titles that will be applied to us 40 years from now – either we become "the greatest generation" or we become "the ineffective screw-ups that doomed America even though they clearly saw the future." We’ll get other chances, but this will likely be the easiest, most comfortable method of change.
Ben Novak, in a letter written to Ron Paul supporters in April of 2008, pointed out some very important issues – the old media has stopped reliably delivering truthful coverage; the internet exposes that; as the American people aren’t stupid, this situation will eventually lead to great outcry from the American people; Ron Paul is positioned, and has been positioning himself for decades to be exactly where he is at this moment in history, to be a leader capable of correcting the course in America. I’ll let Novak speak for himself:
"I like to think (but do not really know) that this is the way Ron Paul understands the situation. As the old saying goes, ‘Nothing is as powerful as an idea whose time has come.’ Well, RP has the idea, and he has the wisdom and the patience to wait till its time has come. So far, he has beautifully positioned himself for when that time comes. He has waged his campaign to take the word out to the people. Only a few heard, but they have seen for themselves how the MSM works. Ron Paul has earned their trust. He is the only one who has come through this campaign more trusted than he entered it. One out of twenty voters already knows and trusts him.
"That means when the wind of truth begins to blow, each one of those one-in-twenty Ron Paul supporters need only bring the facts to nine or ten people to create a majority in the whole country. And when the jolts and shocks of reality hit and break through the web of obfuscation and lies of the MSM, people will be looking for real facts and truth. And Ron Paul supporters will already be armed to give it to them.
"And it may come sooner than expected. All the things Ron Paul said about the economy are coming true in spades – with credit collapses, falling dollars, rising oil prices, and recession (perhaps soon to become "Depression"), and most of all, spreading wars and endless quagmires."
Think about Novak’s observation – 1 in 20 voters trusted Ron Paul in 2008. If those one in twenty each find 9 or 10 friends to bring to the polling place on the morning of the primaries, we win the nomination. Part of the good news is that more than 1 in 20 voters trust Ron Paul today. Maybe it’s 2 in 20 or 3 in 20. We don’t know. There is someone out there who does know. And while our movement is good at fundraising, good at being heard, good at winning straw polls, there’s no room for resting on our laurels right now, because the truth of the matter is ugly. Here comes the most important thing I have to tell you. It’s that defeat is just around the corner, waiting for you and me to sit idle.
The Numbers
The numbers that Ron Paul has today aren’t going to cut it. That’s the fact of the matter. If you are reading this right now, you need to personally deliver 10 votes for Ron Paul on election day. You need to personally bring in 10 voters who otherwise wouldn’t have voted for Ron Paul. If you bring in a minimum of 10 voters and thousands of other Ron Paul supporters bring in a minimum of 10 voters, Ron Paul wins. One vote doesn’t cut it and seven votes won’t cut it. You bring in 10 voters, you motivate the people around you to bring in 10 voters, you make sure those 10 voters show up to vote for Ron Paul on the morning of the primaries and Ron Paul wins this nomination.
You don’t do that and Ron Paul loses. Ron Paul becomes the greatest candidate who never became president.
In 2008, on the Eve of the New Hampshire primary I was talking to Fox News commentator Frank Luntz, the author of "The Contract with America," the man that freedom lovers despise for his Goebbels-ian ways. He bet me $1,000 that he could call Ron Paul’s percentage. He knew Ron Paul wouldn’t see 20%, because Frank Luntz knew the available polling data, and he knew what the good data was saying. He confidently stretched out his hand to me to offer the $1,000 wager. I refused to accept the bet and shake Frank Luntz’s hand, and with his confidence Frank Luntz quieted me down for a few minutes.
I could tell that Frank Luntz didn’t really want to say that to me, because he didn’t want to hurt my feelings with that certainty. I think somewhere in him, he appreciated my devotion to the principles of freedom. In time, I would come to realize that Frank Luntz was right. Ron Paul supporters were out shouting and waving signs; we were the most populous on the streets, the loudest, the most excited, and we definitely had the biggest signs.
However, when it came down to what mattered in an election, we didn’t deliver what was needed for our candidate of choice. We lost because we didn’t deliver. I spent weeks in New Hampshire in 2008 campaigning for Ron Paul. To this day, I don’t know if I brought in even 10 votes for Ron Paul in all of those phone calls I made for him in the Live Free or Die State, all of those hours of hearing what was on the minds of voters and asking for a vote for my candidate. I didn’t personally follow up; I didn’t personally get those voters into the polling place on election day. I wasn’t the one following through, so I have no idea how, or if, that follow-through happened. You see, no matter how many people you "convert" to Ron Paul’s ideas of freedom – something plenty of Ron Paul supporters brag about – if you don’t get them to vote for Ron Paul on election day, you’ve accomplished little toward winning a race.
This year, I’ll bring in many multiples of that. I won’t be talking to strangers; I’ll be talking to my social precinct. I’ll be reaching out to the people around me.
In elections, you don’t get into a fight that you don’t have a big enough stick to win. You get into fights to win. You pick the fights that you have a darn good chance of winning. Ron Paul isn’t travelling the country, sleeping in hotels, getting battered by the media because he doesn’t want to be the president. He’s doing this because he knows he can win. You get out and get those 10 votes, Ron Paul wins. You get 10 Ron Paul supporters around you to go out and get 10 votes each, Ron Paul wins. You get 10 pro-peace voters to register Republican and to vote for Ron Paul, Ron Paul wins.
Victory rests in our hands today. With hard work and focus each one of us can deliver those 10 votes. Will you deliver 10 votes for Ron Paul or will you be one of the others, that segment of Ron Paul supporters that will long deserve the scorn of friends and opponents alike?
I write this not for the folks who are opposed to political participation, but for those who recognize the importance of political participation. Working half-heartedly or ineffectively in these times that so matter is simply not enough, because victory is so close for a candidate who is so threatening to the forces that oppose freedom.
What Ron Paul threatens to do is to take the free meal ticket from many men and women who currently depend on government’s corrupt corporate "welfare" in order to live well. There are lots of people who need Ron Paul to lose, because they see that their livelihoods depend on it. Simply sharing links on Facebook and getting into online debates will do little to make Ron Paul president; in fact, the powers that be would love to see Ron Paul’s proponents stay online "where they belong" or just coming outside every once in a while to wave signs. Those actions are entirely ineffective in winning a campaign. Do them and you are just as bad as any neo-con – because you have a chance to effectively fight for liberty, yet you do nothing. Your silence, your comfortable obeisance in your day-to-day life, only strengthens the existing system. You spend your day strengthening that system, just like a neo-con. In fact, I’d say you’re even worse than a neo-con, because a neo-con doesn’t get it. A neo-con isn’t wasting the opportunities to destroy the shackles, because he doesn’t feel the shackles. You who feel those shackles, yet do nothing effective in response to them – you are villains in this story.
The first day this spring when Ron Paul loses an online poll is the day that I know the movement has refocused its attention on something better – winning a race instead of acting like we’ve already won a race. Rejoicing about our strength and our numbers is exactly that – acting like we’ve won a race. We have no reason for gloating, yet so many Ron Paul supporters gloat. We have not won the race.
We can do this. We can win this election. America is ready for us to step up and lead. If we don’t, if we can’t capture the nomination and then the presidency, well, we are losers. We are pathetic. We had the most beautiful possible chance in our hands – a peaceful revolution – and we blew it. I’m 32 years old. I know that in the next 12 months, the people of this age will earn one of two titles that will be applied to us 40 years from now – either we become "the greatest generation" or we become "the ineffective screw-ups that doomed America even though they clearly saw the future." We’ll get other chances, but this will likely be the easiest, most comfortable method of change.
Ben Novak, in a letter written to Ron Paul supporters in April of 2008, pointed out some very important issues – the old media has stopped reliably delivering truthful coverage; the internet exposes that; as the American people aren’t stupid, this situation will eventually lead to great outcry from the American people; Ron Paul is positioned, and has been positioning himself for decades to be exactly where he is at this moment in history, to be a leader capable of correcting the course in America. I’ll let Novak speak for himself:
"I like to think (but do not really know) that this is the way Ron Paul understands the situation. As the old saying goes, ‘Nothing is as powerful as an idea whose time has come.’ Well, RP has the idea, and he has the wisdom and the patience to wait till its time has come. So far, he has beautifully positioned himself for when that time comes. He has waged his campaign to take the word out to the people. Only a few heard, but they have seen for themselves how the MSM works. Ron Paul has earned their trust. He is the only one who has come through this campaign more trusted than he entered it. One out of twenty voters already knows and trusts him.
"That means when the wind of truth begins to blow, each one of those one-in-twenty Ron Paul supporters need only bring the facts to nine or ten people to create a majority in the whole country. And when the jolts and shocks of reality hit and break through the web of obfuscation and lies of the MSM, people will be looking for real facts and truth. And Ron Paul supporters will already be armed to give it to them.
"And it may come sooner than expected. All the things Ron Paul said about the economy are coming true in spades – with credit collapses, falling dollars, rising oil prices, and recession (perhaps soon to become "Depression"), and most of all, spreading wars and endless quagmires."
Think about Novak’s observation – 1 in 20 voters trusted Ron Paul in 2008. If those one in twenty each find 9 or 10 friends to bring to the polling place on the morning of the primaries, we win the nomination. Part of the good news is that more than 1 in 20 voters trust Ron Paul today. Maybe it’s 2 in 20 or 3 in 20. We don’t know. There is someone out there who does know. And while our movement is good at fundraising, good at being heard, good at winning straw polls, there’s no room for resting on our laurels right now, because the truth of the matter is ugly. Here comes the most important thing I have to tell you. It’s that defeat is just around the corner, waiting for you and me to sit idle.
The Numbers
The numbers that Ron Paul has today aren’t going to cut it. That’s the fact of the matter. If you are reading this right now, you need to personally deliver 10 votes for Ron Paul on election day. You need to personally bring in 10 voters who otherwise wouldn’t have voted for Ron Paul. If you bring in a minimum of 10 voters and thousands of other Ron Paul supporters bring in a minimum of 10 voters, Ron Paul wins. One vote doesn’t cut it and seven votes won’t cut it. You bring in 10 voters, you motivate the people around you to bring in 10 voters, you make sure those 10 voters show up to vote for Ron Paul on the morning of the primaries and Ron Paul wins this nomination.
You don’t do that and Ron Paul loses. Ron Paul becomes the greatest candidate who never became president.
In 2008, on the Eve of the New Hampshire primary I was talking to Fox News commentator Frank Luntz, the author of "The Contract with America," the man that freedom lovers despise for his Goebbels-ian ways. He bet me $1,000 that he could call Ron Paul’s percentage. He knew Ron Paul wouldn’t see 20%, because Frank Luntz knew the available polling data, and he knew what the good data was saying. He confidently stretched out his hand to me to offer the $1,000 wager. I refused to accept the bet and shake Frank Luntz’s hand, and with his confidence Frank Luntz quieted me down for a few minutes.
I could tell that Frank Luntz didn’t really want to say that to me, because he didn’t want to hurt my feelings with that certainty. I think somewhere in him, he appreciated my devotion to the principles of freedom. In time, I would come to realize that Frank Luntz was right. Ron Paul supporters were out shouting and waving signs; we were the most populous on the streets, the loudest, the most excited, and we definitely had the biggest signs.
However, when it came down to what mattered in an election, we didn’t deliver what was needed for our candidate of choice. We lost because we didn’t deliver. I spent weeks in New Hampshire in 2008 campaigning for Ron Paul. To this day, I don’t know if I brought in even 10 votes for Ron Paul in all of those phone calls I made for him in the Live Free or Die State, all of those hours of hearing what was on the minds of voters and asking for a vote for my candidate. I didn’t personally follow up; I didn’t personally get those voters into the polling place on election day. I wasn’t the one following through, so I have no idea how, or if, that follow-through happened. You see, no matter how many people you "convert" to Ron Paul’s ideas of freedom – something plenty of Ron Paul supporters brag about – if you don’t get them to vote for Ron Paul on election day, you’ve accomplished little toward winning a race.
This year, I’ll bring in many multiples of that. I won’t be talking to strangers; I’ll be talking to my social precinct. I’ll be reaching out to the people around me.
In elections, you don’t get into a fight that you don’t have a big enough stick to win. You get into fights to win. You pick the fights that you have a darn good chance of winning. Ron Paul isn’t travelling the country, sleeping in hotels, getting battered by the media because he doesn’t want to be the president. He’s doing this because he knows he can win. You get out and get those 10 votes, Ron Paul wins. You get 10 Ron Paul supporters around you to go out and get 10 votes each, Ron Paul wins. You get 10 pro-peace voters to register Republican and to vote for Ron Paul, Ron Paul wins.
Victory rests in our hands today. With hard work and focus each one of us can deliver those 10 votes. Will you deliver 10 votes for Ron Paul or will you be one of the others, that segment of Ron Paul supporters that will long deserve the scorn of friends and opponents alike?
WHAT I THINK........CHARLES GOYETTE
With wins in Michigan and Arizona, Willard Mitt Romney, the establishment candidate, appears to be back in the driver’s seat in the race to the Republican presidential nomination. Meanwhile, Ron Paul continues to add to his delegate count.
Establishment Republicans are a breed unto themselves. If you go to their long-term planning meetings, if you listen to them talk about their Party’s future, it’s like listening to well-known lyrics of familiar tunes. It’s all about broadening the base, getting more young people involved, becoming relevant, how to capture enthusiasm, more young people, using the internet, reaching out to young people, figuring out how to fundraise in the digital age, getting more young people.
Now, along comes Ron Paul, who offers them exactly what they want: young people, enthusiasm, an unbeatable social media campaign, devoted volunteers, better demographics, new fundraising success, a campaign worthy of the digital age, relevance, money, excitement, and (did I mention?) young people.
It’s exactly what they have wished for. Exactly what they need. And they turn their back on it.
What do Republicans actually do? They like to give their nomination to the candidate who they think deserves it. Principles and ideals are off the table. The Party’s future that they worry about is forgotten. Because all they really want to do is give the nomination to the candidate whose turn it is.
Look at Bush the Elder. The Reagan Republicans never liked him. In fact, I knew a delegate to the Republican convention that nominated Reagan in 1980 who typified that view. She even refused to vote for Bush to be on the ticket. Even though he was Reagan’s pick. But after Reagan, it was Bush’s "turn." He got the nomination.
Bob Dole had been Senate minority and majority leader for 10 years. He had been Gerald Ford’s running mate in 1976. It didn’t matter that he had no vision to stir the people like Ron Paul does. All Dole could do was talk about process; dry, boring tales about the times he invoked cloture. Thrilling. But in 1996, it was his turn. He got the nomination.
John McCain was said to be a war hero. After losing the nomination to Bush the Younger in 2000 and despite standing for a lot of things that Republicans said they opposed, after Bush’s eight-year romp, it was McCain’s turn. He got the nomination.
Which brings us back to Romney. Like George W. Bush, Romney’s father had been a figure in Republican politics, remembered today only for the help he gave the Party’s old guard Rockefeller establishment in trying to stop Goldwater from getting the nomination in 1964. Mitt Romney himself has been a governor, and, more importantly, ran a close second to John McCain in 2008.
So it’s his turn.
That’s the other thing about the way the Republican’s choose their nominees. They have to be establishment figures. That helps them decide whose turn it is. So, true to form, the Arizona and Michigan primaries went to Romney. He’s an establishment guy. And it’s his turn.
Still the Internet is filled with pictures of Romney addressing people in a mostly empty stadium, gymnasiums with nobody seated beyond the first couple of rows, and campaign rallies that would even make the Maytag repairman feel abandoned.
At the same time, Ron Paul is packing them to the rafters, overflowing rallies with hundreds turned away, cheering crowds of thousands, shoulder-to-shoulder, elbow-to-elbow supporters, wild in their enthusiasm for Ron Paul and his message of freedom, peace, and prosperity.
As he does better and better with the people, out comes the establishment, sharpening its long knives. Here’s the New York Times’ recent judgment: "Ron Paul long ago disqualified himself for the presidency by peddling claptrap proposals like abolishing the Federal Reserve, returning to the gold standard, cutting a third of the federal budget and all foreign aid and opposing the Civil Rights Act of 1964."
We’ve been down this road before. The establishment likes its central bank-Wall Street axis running the Republican Party. It prefers its candidates be big government, big spending blue bloods of the Rockefeller wing of the party: George Bush, the elder son of Wall Street’s Prescott Bush and the man who made possible the bumbling, big-spending W. Bush years that ended in financial panic; John McCain, who sounded like a confused beauty pageant contestant when Ron Paul asked him a simple question about economic policy; and the flip-flopping, easily molded Mitt Romney, who fits the mold of an establishment Republican candidate.
Still, Ron Paul continues to get more delegates. My friend Michael Shedlock of Mish’s Global Economic Analysis has done a good job crunching the numbers and concludes that the odds of a brokered convention – one in which Romney doesn’t have enough delegates to cinch the nomination on the first ballot – is better than 50%. See his numbers here.
It’s enough to make next week’s Super Tuesday interesting. And by the time the convention rolls around this summer, maybe the Republicans will have figured out what a Rasmussen poll reported yesterday – that Ron Paul beat Obama in a head-to-head matchup, and outperformed all the other Republicans against the president.
Wow! All the things the Republicans want: Youth, energy, enthusiasm, grassroots support and fundraising. And did I mention young people?
All that and a victory, too!
Establishment Republicans are a breed unto themselves. If you go to their long-term planning meetings, if you listen to them talk about their Party’s future, it’s like listening to well-known lyrics of familiar tunes. It’s all about broadening the base, getting more young people involved, becoming relevant, how to capture enthusiasm, more young people, using the internet, reaching out to young people, figuring out how to fundraise in the digital age, getting more young people.
Now, along comes Ron Paul, who offers them exactly what they want: young people, enthusiasm, an unbeatable social media campaign, devoted volunteers, better demographics, new fundraising success, a campaign worthy of the digital age, relevance, money, excitement, and (did I mention?) young people.
It’s exactly what they have wished for. Exactly what they need. And they turn their back on it.
What do Republicans actually do? They like to give their nomination to the candidate who they think deserves it. Principles and ideals are off the table. The Party’s future that they worry about is forgotten. Because all they really want to do is give the nomination to the candidate whose turn it is.
Look at Bush the Elder. The Reagan Republicans never liked him. In fact, I knew a delegate to the Republican convention that nominated Reagan in 1980 who typified that view. She even refused to vote for Bush to be on the ticket. Even though he was Reagan’s pick. But after Reagan, it was Bush’s "turn." He got the nomination.
Bob Dole had been Senate minority and majority leader for 10 years. He had been Gerald Ford’s running mate in 1976. It didn’t matter that he had no vision to stir the people like Ron Paul does. All Dole could do was talk about process; dry, boring tales about the times he invoked cloture. Thrilling. But in 1996, it was his turn. He got the nomination.
John McCain was said to be a war hero. After losing the nomination to Bush the Younger in 2000 and despite standing for a lot of things that Republicans said they opposed, after Bush’s eight-year romp, it was McCain’s turn. He got the nomination.
Which brings us back to Romney. Like George W. Bush, Romney’s father had been a figure in Republican politics, remembered today only for the help he gave the Party’s old guard Rockefeller establishment in trying to stop Goldwater from getting the nomination in 1964. Mitt Romney himself has been a governor, and, more importantly, ran a close second to John McCain in 2008.
So it’s his turn.
That’s the other thing about the way the Republican’s choose their nominees. They have to be establishment figures. That helps them decide whose turn it is. So, true to form, the Arizona and Michigan primaries went to Romney. He’s an establishment guy. And it’s his turn.
Still the Internet is filled with pictures of Romney addressing people in a mostly empty stadium, gymnasiums with nobody seated beyond the first couple of rows, and campaign rallies that would even make the Maytag repairman feel abandoned.
At the same time, Ron Paul is packing them to the rafters, overflowing rallies with hundreds turned away, cheering crowds of thousands, shoulder-to-shoulder, elbow-to-elbow supporters, wild in their enthusiasm for Ron Paul and his message of freedom, peace, and prosperity.
As he does better and better with the people, out comes the establishment, sharpening its long knives. Here’s the New York Times’ recent judgment: "Ron Paul long ago disqualified himself for the presidency by peddling claptrap proposals like abolishing the Federal Reserve, returning to the gold standard, cutting a third of the federal budget and all foreign aid and opposing the Civil Rights Act of 1964."
We’ve been down this road before. The establishment likes its central bank-Wall Street axis running the Republican Party. It prefers its candidates be big government, big spending blue bloods of the Rockefeller wing of the party: George Bush, the elder son of Wall Street’s Prescott Bush and the man who made possible the bumbling, big-spending W. Bush years that ended in financial panic; John McCain, who sounded like a confused beauty pageant contestant when Ron Paul asked him a simple question about economic policy; and the flip-flopping, easily molded Mitt Romney, who fits the mold of an establishment Republican candidate.
Still, Ron Paul continues to get more delegates. My friend Michael Shedlock of Mish’s Global Economic Analysis has done a good job crunching the numbers and concludes that the odds of a brokered convention – one in which Romney doesn’t have enough delegates to cinch the nomination on the first ballot – is better than 50%. See his numbers here.
It’s enough to make next week’s Super Tuesday interesting. And by the time the convention rolls around this summer, maybe the Republicans will have figured out what a Rasmussen poll reported yesterday – that Ron Paul beat Obama in a head-to-head matchup, and outperformed all the other Republicans against the president.
Wow! All the things the Republicans want: Youth, energy, enthusiasm, grassroots support and fundraising. And did I mention young people?
All that and a victory, too!
MONETARY POLICY IS DESTROYING THIS COUNTRY
Before the United States House of Representatives Committee on Financial Services, Hearing on 'Monetary Policy and the State of the Economy,' 2/29/2012
Mr. Chairman, thank you for holding this hearing on monetary policy and the state of the economy. I believe that now, more than ever, the American people want to hold the Federal Reserve accountable for its loose monetary policy and want full transparency of the Fed's actions.
While the Fed has certainly released an unprecedented amount of information on its activities, there is still much that remains unknown. And every move towards transparency has been fought against tooth and nail by the Fed. It took disclosure requirements enacted within the Dodd-Frank Act to get the Fed to provide data on the its emergency lending facilities. It took lawsuits filed by Bloomberg and Fox News to provide data on discount window lending during the worst parts of the financial crisis. And it will take further concerted action on the part of Congress, the media, and the public to keep up pressure on the Fed to remain transparent.
Transparency is not a panacea, however, as a fully transparent organization is still capable of engaging in all sorts of mischief, as the Federal Reserve does on a regular basis. Ironically, one of the Fed's more egregious recent actions, adopting an explicit inflation target, was hailed by many as another wonderful example of transparency. Yet if you think about what this supposed 2% inflation target actually is, you realize that it is an explicit policy to devalue the dollar and reduce its purchasing power. Two percent annual price inflation means that prices rise 22% within a decade, and nearly 50% within two decades.
Indeed, if you look at the performance of the consumer price index (CPI) under Chairman Bernanke's tenure, prices have risen at a rate of 2.25% per year. Many, perhaps even most, economists would consider this a modest rise, an example of sober, cautious monetary policy. Some economists of Paul Krugman's persuasion might even argue that this is too tight a monetary policy. However, 2.25% is not too far off from the Fed's new 2% target.
Now look at the performance of the US economy since February 1, 2006, the date Chairman Bernanke took the mantle from Alan Greenspan. Trillions of dollars have been wasted on bailouts, stimulus packages, and other feckless spending. Millions of Americans have lost their jobs and have lost hope of ever regaining employment. The national debt has risen to more than 100% of GDP, as the federal government continues to rack up trillion-dollar deficits, aided and abetted by the Fed's policies of quantitative easing and zero percent interest rates. And we are supposed to believe that a 2% inflation rate, similar to what has prevailed during the worst economic crisis since the Great Depression, is the cure for what ails this economy.
This explicit 2% target also fails to take into account that whatever measure is used to determine price inflation, be it CPI, core CPI, PCE, etc., will always be chosen with an eye towards underreporting the true rate of inflation and price rises. Pressure will be exerted on those calculating the price indices, so as not to alarm the public when prices begin to accelerate. One need only look at what is taking place in Argentina today, where the government publishes an official CPI figure that is often less than half that reported by private sources.
A similar situation exists in this country, where economists calculating CPI according to the original basket of goods have determined that price inflation has increased 9.5% per year since 2006, rather than the 2.25% reported by the government. Even the government's own data reports price rises of nearly 7% per year since 2006 on such consumer goods as gasoline and eggs. Bread, rice, and ground beef have increased by nearly 6% per year, while bacon and potatoes have increased nearly 5% per year. This means that in a little over half a decade, prices on staple consumer goods have increased 30-50%, all while wages have stagnated and millions of Americans find themselves out of work and without a paycheck. Of course, government officials claim that price increases do not affect the average American because they can always buy hamburger instead of steak, or have cereal instead of bacon. But the American people can see how they are suffering because of the Federal Reserve. The government’s claims that the official statistics show no reason to be concerned about inflation is Marxist – as in Groucho, who famously said: "Who are you going to believe, me or your own eyes?"
The Federal Reserve continues to keep interest rates low in the hopes of boosting lending and consumption. But keeping interest rates at zero discourages saving, particularly as the rate of price inflation continues to rise. Why stick money in a savings account earning 0.05% if it is guaranteed to lose at least 2% of its value every year? And this is a guarantee, as the Fed has promised a 2% rate of increase in price inflation, while also guaranteeing a zero percent federal funds rate through 2014. Retirees living on fixed incomes, dependent on savings, or on interest income from investments will see their savings drawn down as they are forced to consume principal. Young people, hard hit by the recession and struggling to find jobs, will fail to see the virtue of thrift. Saving or investing is an exercise in futility, as parking money in the bank or in CDs will guarantee a loss, while investing in stocks, bonds, or mutual funds will net at best paltry gains, and at worst massive losses in this continuing weak economy.
The longer the Federal Reserve keeps interest rates low and discourages savings and investment, the more societal attitudes will change from being future oriented to present oriented. The Federal Reserve and its policies already served to stimulate and prioritize consumption over saving, creating the largest debt bubble the world has ever known. The extended zero interest rate policy only serves to promote more consumption and debt now, eviscerating thrift and savings – the true building blocks of prosperity. This present-oriented mindset has become pervasive especially among politicians, putting the government in dismal financial shape as Congressmen and Presidents over the years have taken to heart Louis XV's famous saying: "Après moi, le déluge." If the American people follow the same path in their own lives, this country will be ruined. Capital will be depleted, infrastructure will fall into disrepair, and the United States will be a mere shadow of its former self. It is well past time to end the failed monetary policy that encourages this mistaken preference for cheap money now.
Mr. Chairman, thank you for holding this hearing on monetary policy and the state of the economy. I believe that now, more than ever, the American people want to hold the Federal Reserve accountable for its loose monetary policy and want full transparency of the Fed's actions.
While the Fed has certainly released an unprecedented amount of information on its activities, there is still much that remains unknown. And every move towards transparency has been fought against tooth and nail by the Fed. It took disclosure requirements enacted within the Dodd-Frank Act to get the Fed to provide data on the its emergency lending facilities. It took lawsuits filed by Bloomberg and Fox News to provide data on discount window lending during the worst parts of the financial crisis. And it will take further concerted action on the part of Congress, the media, and the public to keep up pressure on the Fed to remain transparent.
Transparency is not a panacea, however, as a fully transparent organization is still capable of engaging in all sorts of mischief, as the Federal Reserve does on a regular basis. Ironically, one of the Fed's more egregious recent actions, adopting an explicit inflation target, was hailed by many as another wonderful example of transparency. Yet if you think about what this supposed 2% inflation target actually is, you realize that it is an explicit policy to devalue the dollar and reduce its purchasing power. Two percent annual price inflation means that prices rise 22% within a decade, and nearly 50% within two decades.
Indeed, if you look at the performance of the consumer price index (CPI) under Chairman Bernanke's tenure, prices have risen at a rate of 2.25% per year. Many, perhaps even most, economists would consider this a modest rise, an example of sober, cautious monetary policy. Some economists of Paul Krugman's persuasion might even argue that this is too tight a monetary policy. However, 2.25% is not too far off from the Fed's new 2% target.
Now look at the performance of the US economy since February 1, 2006, the date Chairman Bernanke took the mantle from Alan Greenspan. Trillions of dollars have been wasted on bailouts, stimulus packages, and other feckless spending. Millions of Americans have lost their jobs and have lost hope of ever regaining employment. The national debt has risen to more than 100% of GDP, as the federal government continues to rack up trillion-dollar deficits, aided and abetted by the Fed's policies of quantitative easing and zero percent interest rates. And we are supposed to believe that a 2% inflation rate, similar to what has prevailed during the worst economic crisis since the Great Depression, is the cure for what ails this economy.
This explicit 2% target also fails to take into account that whatever measure is used to determine price inflation, be it CPI, core CPI, PCE, etc., will always be chosen with an eye towards underreporting the true rate of inflation and price rises. Pressure will be exerted on those calculating the price indices, so as not to alarm the public when prices begin to accelerate. One need only look at what is taking place in Argentina today, where the government publishes an official CPI figure that is often less than half that reported by private sources.
A similar situation exists in this country, where economists calculating CPI according to the original basket of goods have determined that price inflation has increased 9.5% per year since 2006, rather than the 2.25% reported by the government. Even the government's own data reports price rises of nearly 7% per year since 2006 on such consumer goods as gasoline and eggs. Bread, rice, and ground beef have increased by nearly 6% per year, while bacon and potatoes have increased nearly 5% per year. This means that in a little over half a decade, prices on staple consumer goods have increased 30-50%, all while wages have stagnated and millions of Americans find themselves out of work and without a paycheck. Of course, government officials claim that price increases do not affect the average American because they can always buy hamburger instead of steak, or have cereal instead of bacon. But the American people can see how they are suffering because of the Federal Reserve. The government’s claims that the official statistics show no reason to be concerned about inflation is Marxist – as in Groucho, who famously said: "Who are you going to believe, me or your own eyes?"
The Federal Reserve continues to keep interest rates low in the hopes of boosting lending and consumption. But keeping interest rates at zero discourages saving, particularly as the rate of price inflation continues to rise. Why stick money in a savings account earning 0.05% if it is guaranteed to lose at least 2% of its value every year? And this is a guarantee, as the Fed has promised a 2% rate of increase in price inflation, while also guaranteeing a zero percent federal funds rate through 2014. Retirees living on fixed incomes, dependent on savings, or on interest income from investments will see their savings drawn down as they are forced to consume principal. Young people, hard hit by the recession and struggling to find jobs, will fail to see the virtue of thrift. Saving or investing is an exercise in futility, as parking money in the bank or in CDs will guarantee a loss, while investing in stocks, bonds, or mutual funds will net at best paltry gains, and at worst massive losses in this continuing weak economy.
The longer the Federal Reserve keeps interest rates low and discourages savings and investment, the more societal attitudes will change from being future oriented to present oriented. The Federal Reserve and its policies already served to stimulate and prioritize consumption over saving, creating the largest debt bubble the world has ever known. The extended zero interest rate policy only serves to promote more consumption and debt now, eviscerating thrift and savings – the true building blocks of prosperity. This present-oriented mindset has become pervasive especially among politicians, putting the government in dismal financial shape as Congressmen and Presidents over the years have taken to heart Louis XV's famous saying: "Après moi, le déluge." If the American people follow the same path in their own lives, this country will be ruined. Capital will be depleted, infrastructure will fall into disrepair, and the United States will be a mere shadow of its former self. It is well past time to end the failed monetary policy that encourages this mistaken preference for cheap money now.
Subscribe to:
Posts (Atom)
