The Brothers Austrian

MisesBeliever Uncategorized austrian school, Change, obama, Rand Paul, ron paul

Picking up off a recent blog article that made some waves, this post is in support of H.R. 1207.  Ron Paul introduced the Federal Reserve Transparency Act of 2009 last week.  According to Paul, the bill is the first step to open up the Fed’s ‘opaque’ operations to the public.  As Rothbard put it in The Case Against the Fed,

By far the most secret and least accountable operation of the federal government is not, as one might expect, the CIA, DIA, or some other super-secret intelligence agency. The CIA and other intelligence operations are under control of the Congress. They are accountable: a Congressional committee supervises these operations, controls their budgets, and is informed of their covert activities. It is true that the committee hearings and activities are closed to the public; but at least the people’s representatives in Congress insure some accountability for these secret agencies. It is little known, however, that there is a federal agency that tops the others in secrecy by a country mile. The Federal Reserve System is accountable to no one; it has no budget; it is subject to no audit; and no Congressional  Committee knows of, or can truly supervise, its operations. The Federal Reserve, virtually in total control of the nation’s vital monetary system, is accountable to nobody—and this strange situation, if acknowledged at all, is invariably trumpeted as a virtue.

Teacherman Federal Reserve, Politics Federal Reserve, ron paul, rothbard, transparency

Has anyone ever noticed that rarely do you ever hear or see Ron Paul’s testimony either on Bloomberg or CNBC? Especially recently? Is it possible that the establishment wants to keep him quiet and out of public sight as much as possible? Am I being too much of a conspiracy theorist to think that the establishment sees Ron Paul as dangerous? Here is a statement by Ron Paul to Congress back in 2002:

Though the Federal Reserve policy harms the average American, it benefits those in a position to take advantage of the cycles in monetary policy. The main beneficiaries are those who receive access to artificially inflated money and/or credit before the inflationary effects of the policy impact the entire economy. Federal Reserve policies also benefit big spending politicians who use the inflated currency created by the Fed to hide the true costs of the welfare-warfare state. It is time for Congress to put the interests of the American people ahead of the special interests and their own appetite for big government.

Abolishing the Federal Reserve will allow Congress to reassert its constitutional authority over monetary policy. The United States Constitution grants to Congress the authority to coin money and regulate the value of the currency. The Constitution does not give Congress the authority to delegate control over monetary policy to a central bank. Furthermore, the Constitution certainly does not empower the federal government to erode the American standard of living via an inflationary monetary policy.

In fact, Congress’ constitutional mandate regarding monetary policy should only permit currency backed by stable commodities such as silver and gold to be used as legal tender. Therefore, abolishing the Federal Reserve and returning to a constitutional system will enable America to return to the type of monetary system envisioned by our nation’s founders: one where the value of money is consistent because it is tied to a commodity such as gold.  Such a monetary system is the basis of a true free-market economy.

In conclusion, Mr. Speaker, I urge my colleagues to stand up for working Americans by putting an end to the manipulation of the money supply which erodes Americans’ standard of living, enlarges big government, and enriches well-connected elites, by cosponsoring my legislation to abolish the Federal Reserve.

In the Case Against the Fed, Rothbard warns against the dangers of the fractional banking system. He cautions that fractional banking is legalized embezzlement a ponzi scheme. Banks take your deposits and loan them to other people, thus creating money that they don’t have, with money that isn’t theirs. Essentially every bank that practices  fractional reserve banking is insolvent.  The scheme will eventually be exposed by those that start to understand the fraudulent activity that banks are taking part in when they go to redeem their money and cannot get it back upon demand.

I believe that Ron Paul is seen as menace to this scheme. That perhaps people know that his opinions are given credence by the media and that perhaps the bank runs that Rothbard warns are inevitable will be touched off.   General Electric CNBC as well as other channels, fearing the anarchy that would be created in the wake of bank runs, decide to not give him the prime time that other congressmen get.

MisesBeliever Federal Reserve, Politics cnbc, congress, congressmen, fractional reserve banking, media, ron paul, rothbard