Ron Paul

No Cheers for the Bailout -- Ron Paul Interview

kpaul.mallasch — Mon, 29 Sep 2008 23:20:33 -0700

By Bill Steigerwald

The Ron Paul Solution

You can't pin any blame for the country's financial meltdown on Congressman Ron Paul. The libertarian Texas Republican and former Pittsburgher has been warning for two decades about the unhappy -- and inevitable -- economic consequences of a loose monetary policy, fiscal irresponsibility and too much meddling in the marketplace by the federal government.

Not surprisingly, Rep. Paul says he is "positively opposed" to what he calls the Bush administration's "slipshod" $700 billion bailout plan. As Paul warned the House of Representatives Wednesday, "Our economy faces a bleak future, particularly if the latest $700 billion bailout plan ends up passing. We risk committing the same errors that prolonged the misery of the Great Depression, namely keeping prices from falling."

I talked to Paul by phone from Washington early Thursday evening as the Beltway political powers were still meeting and trying to agree on how to fix the problem they are largely responsible for creating.

Q: I suspect we won't hear you cheering about the bailout -- or "The Rescue" -- as they are trying to call it?

A: No way. I think that it's just going to bring more problems. You can't stop a problem of too much spending and too much deficits and too much monetary inflation with more of it. So I’m positively opposed to the bailout and believe it will just delay the correction that is required. We need to correct the imbalances and if you interfere, you just delay it and make it more difficult and make the problems worse for ourselves.

Q: Did you see President Bush’s 15-minute speech on the economic crisis Thursday night?

A: I did see part of it.

Q: Do you think he is telling the story as straight as he should be or is he glossing over some things?

A: Well, I’m sure he’s glossing over. I imagine he believes what he’s saying. But you know I was just on the (House) floor and a couple other members came over and showed me some articles and letters they’ve received. One was from a banker who’s involved with 1,500 banks in the South. He was positively opposed to the bailout. He said, “Why punish all of us when just a few people have really messed up?” Someone else came along with a chart that showed that credit has not frozen up and that there’s as much credit available in the last couple weeks as there was in the last six months. So that means the (bailout supporters) are working on some propaganda to sort of frighten members of Congress into voting for it. If you don’t vote for it, and there’s a problem, then you’re going to be blamed for it.

Q: Is this truly a national crisis? So many of national crises really are regionalized or localized problems.

A: I think of it as a crisis. I've been talking about it for a long time and have said we will have a financial disruption and an attack on the dollar. But I think the way they are talking is that if you don't pass it this weekend then by Monday the market might go down 10,000 points. I think it's not that type of crisis, but I think it's very significant that if we continue our ways we'll eventually destroy the dollar. Yet what they are doing is bringing that on because they are doing the wrong thing.

Q: You pin most of the blame for this crisis on government.

A: Oh yeah. More specifically, the Federal Reserve. (It's) responsible for the booms and the busts. You can't have this type of a boom cycle without a Federal Reserve and a central bank and it can be bounded with other parts of the government. Legislation might push an excessive amount of money into certain areas in addition to the easy-money system, and that's what I think happened. There were these affirmative action programs where banks were literally encouraged or told they had to make bad loans. The Community Reinvestment Act tells them they can be fined a lot of money for denying loans that are risky. It's sort of ironic.

And if one looks at the total problem of inflation, in which prices go up because of the increases in the money supply, certain areas go up much faster than others. So medical care and education and houses went up much faster but then there has to be corrections. They get out of whack and these prices have to come down. So we see the correction and the sooner you get the prices down, the better it is for everybody.

Q: From what I understand the major problem goes back to housing, housing, housing. Home prices were inflated and now the bubble has burst and you argue that prices should be allowed to fall to whatever their real level should be and not be propped up by a federal bailout.

A: That's right, and I accuse (Federal Reserve Chairman Ben) Bernanke of being a price-fixer. He wants to buy these illiquid assets and keep the price up and they may be worthless. So they want you to limit your thinking to the immediate problem -- the downturn in the housing market. But they don't want to talk about who caused the upturn and the excesses in the housing market -- and that was government. They don't talk about the cause. They just say, "We're here now. What are we going to do about it?" In medicine, you can't really treat a disease very well if you don't know the exact cause.

Q: The $700 billion figure. If you multiply roughly 3 million homes in foreclosure by $100,000 -- assuming they are underwater on their mortgages by an average of $100,000 -- that's "only" $300 billion.

A: So where's all this money going, huh?

Q: Yes.

A: Propping up derivatives; that's the scam. It's the so-called "illiquid assets." I think that's a misnomer. I think it's "worthless assets" that are being bought up so some of these big guys don't get wiped out.

Q: You say a $700 billion bailout is only a temporary fix.

A: Yeah, it is. If you come to the conclusion that you have to liquidate debt, the faster you get it over with the sooner the economy goes back to work. So they're propping up the prices artificially on houses and at the same time they are saying, "How can we stimulate housing growth?" Well, there are too many houses. You want the supply and demand of houses to adjust, so you let the prices of houses come down and let the houses get in the hands of people who really want them and can afford them and you quit building houses for a while.

So, yeah, you have a booming economy when you deceive the people and you stimulate the economy with easy credit. But you've got to make up for it eventually, and that's the part that nobody likes. We have prevented any attempt at correction essentially over the past 20 years. So we have a bigger bubble than ever before, which means we'll have a bigger correction than ever before. So the only question is, should it be a short, tough correction or a very long, tough correction?

Q: What is your solution for avoiding this kind of sudden national emergency?

A: You need to allow a liquidation of debt, which means bankruptcies. You should treat it like Lehman Brothers -- let them go broke and the good assets will be bought up. But you should restore confidence and encourage business activity. It isn't a lack of regulation that was the problem, it was the lack of the market being allowed to work.

We don't need more Sarbanes-Oxley (financial reporting) regulations like those that came out of Enron. But we should assure the markets that we are going to live within our means. I think the federal budget ought to be balanced. You could do that rather quickly by changing our foreign policy. But people aren't quite willing to give up the welfare-warfare state. But if you did that, things could come back very quickly.

Bill Steigerwald is a columnist at the Pittsburgh Tribune-Review. E-mail Bill at steigerwald@caglecartoons.com. ©Pittsburgh Tribune-Review, All Rights Reserved.

Ron Paul: Running on empty, but still running...

kpaul.mallasch — Fri, 15 Feb 2008 18:44:16 -0800

By Rex Bell

Ron Paul's decision to forego a third party presidential bid this fall, along with any chance of being on the ballot, has left a lot of Libertarians and Constitutionalists, along with a lot of disgruntled Republicans, Democrats and Independents, with somewhat of an empty feeling. It's been a couple of hundred years since a candidate with Paul's passion for a Constitutionaly limited government has captured as much national attention. (Dr.Paul received more votes from Republican primaries on just Super Tuesday than any Libertarian Party candidate has in any general election since I've been affiliated with the party.) His decision not to run dashed a lot of hopes.

It would be easy to become discouraged that the vision for limited government didn't catch on this year. It would be easy to simply give in and give up. But I remember about 40 years ago when I was taking a karate class, and the instructor (I can't remember his correct title), would put us through some horrific exercises that required more endurance than most of us felt we had. When the last student gave up and dropped his arms, the instructor explained that someday we might be in a situation when the desire and ability to persevere would be the only thing that would keep us alive. There might come a time when can't count on someone else to save you.

I think that is where we are today. If you were one of those people that supported Ron Paul's push for limited government, personal freedom and personal responsibility, it didn't take too many primaries to figure out that the bulk of the Republican Party is no longer interested in promoting those concepts. Neither are they considered options by the Democrats.

So then what? We could give up, but I'm pretty sure we wouldn't like the results of that. Or, we could continue to fight. The Libertarian Party will nominate it's Presidential candidate this May. Although I don't know who that candidate will be, they will be the only candidate on most ballots that endorse limited government. I'm fairly certain it will be someone that holds most of the same libertarian values of Dr. Paul. I'm also fairly certain that the candidate won't have the name recognition of Dr. Paul, or the fundraising capabilities of the Paul campaign. I pretty sure the candidate won't garner as many votes as Ron Paul would if he was on the ballot.

But the Libertarian candidate will give limited government supporters a chance to vote for limited government. And a chance to hang on and keep fighting.

There are a lot of ways to give up. I'm afraid all of them end badly.

Editorial: Ron Paul, kpaul, and Grassroots Journalism

kpaul.mallasch — Fri, 4 Jan 2008 20:12:50 -0800

By K. Paul Mallasch

I've noticed recently that big media is starting to handle the Ron Paul Revolution that's happening online quite differently than they were just a few short weeks ago. (A lot like the Herald Bulletin starting to change its Editorial tone.)

If you've followed the Ron Paul campaign, you must know that Fox News stock went down a lot after Ron Paul supporters started emailing sponsors about boycotts and other actions. (And if you haven't heard of Ron Paul, he's a Republican you should look into...)

The interesting thing to me is the way CNN has noticed this and appears to be making a conscious effort to relay more news about Ron Paul or to at least tap into the massive amounts of people traversing the web for his cause.

Great, problem fixed, you say. The thing is, the situation with Ron Paul and the mainstream media highlights some of the problems with the current media powers in this country.

How can a potential candidate be so large online but have very little overspill into mainstream news? Why must they continue harping about Hillary, Rudy, Obama and other over and over and over again? Why isn't the media pointing out that it's pretty silly to have a two party system in this the Information Age.

Is it because the politicians need to spend so much money with the media to get their point across?

As a publisher of what I like to call grassroots journalism here in the Hoosier state, I try to give the Libertarians as much play as the Democrats and Republicans. (Some of you out there might know Ron Paul actually ran on a Libertarian ticket years and years ago in 1988...)

The thing is, the blatant disregard of Ron Paul (and other candidates, those without a lot of money) by big media on a national level is telling about the state of American media.

Now, before you run off thinking I'm just some anti-corporate loon, let me state that I do see a need for profit. (This is vital as I've proved that with one person and no offices you can only go so far...) The thing is, though, we're not talking about a normal business that sells pizzas or hamburgers - we're talking about Journalism, something vital to the American way of life.

And something so important to the political process (among other things) has for too many years become nothing more than a conceited, holier-than-thou monologue spewing machine of destruction. (As Jon Stewart said a while back, the media in this country is *hurting* America...)

The current state of the media in this country is harmful - not just for Ron Paul and this election, but for America as a whole, the entire process.

This problem, though, shows another great thing about the American spirit, the willpower to affect change. Al Jordan and myself have been struggling with grassroots journalism in East Central Indiana for going on three years now.

We're starting to see a little growth from all our efforts, but without capital it's hard to build something from the ground-up. To attempt to stir up the current system of media in this country without any money is perhaps even more ludicrous, but it's something that has to be done.

We're not the only ones, of course, as there are a lot of others around the country doing similar things on their own (some for even longer than we've been at it...) The thing is, I've worked for big media for almost a decade. I don't see change happening from within.

Like the Ron Paul Revolution itself, I believe it will take the people standing up on their own and demanding a better media. Individuals like Al and I are out here on the front lines in the Midwest, willing and happy to help people create a better media.

Personally, I think the 'business model' that will work best will be one that combines professionally trained as well as amateur (citizen) journalists - so called Pro-Am journalism. I've been trying to work with other individuals in the state to create a loose confederation of media sites and sources.

I'm hoping that if we have more companies and individuals running the media and they've been started with a dialog that includes the audience from the get-go, that we have a real chance to affect change on a big scale.

Going back to the current media, though, and Ron Paul. It's too late to expect big media to admit their mistakes and do an honest and complete turnaround. With that in mind, I wonder why there isn't a 'Ron Paul Revolution' sized movement behind grassroots journalism in this country?

Where is the support for those fighting corporate Goliaths from the trenches in an effort to fix a bigger problem in the American political realm - the media itself.

If you're a national visitor and am interested in helping, now's the time.

I'm accepting donations. I have an Amazon Wishlist.

If you have *any* questions about what we're doing to create a better media in the Midwest, please feel free to ask. If you're interested in starting a site like this in your town, check out LocalJournalism.net.

Oh, and Ron Paul, if you're listening, we'd love to have you stop by America's first (AFAIK), public newsroom in Elwood, Indiana (just a bit north of Indianapolis if you're going to be there...)

Thanks for your time.