Ron Paul on CNBC: I worry most about consequences of Currency Destruction – August 10, 2011


Rep. Paul slams Fed for steps risking US dollar’s reserve status

By Pete Kasperowicz – 08/10/11 09:03 AM ET

The Federal Reserve has taken another step to end the dollar’s reign as a global reserve currency, Rep. Ron Paul said Wednesday.

Paul, the GOP presidential candidate and frequent Fed critic, criticized the central bank’s Tuesday announcement that it would keep a key interest rate at or near zero percent for another two years.

“I think what we’re dealing with is the end of the dollar reserve standard, and that’s a world-wide phenomenon,” Paul (R-Texas) said on CNBC.

The Fed on Tuesday did not announce a third round of quantitative easing as some were hoping, which could have led to more Fed purchases of Treasury debt and a flood of new money, something Paul has criticized in the past. Still, Paul implied that the Fed’s decision to keep interest rates low through mid-2013 is a supplemental strategy that will push the dollar down, and said the recent surge in gold prices is a sign of that.

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Ron and Rand Paul say downgrade is fault of Washington, not Tea Party

U.S. Sen. Rand Paul (R-KY) (L) talks to his father Rep. Ron Paul (R-TX) (R) during a news conference June 22, 2011 on Capitol Hill in Washington, DC.

(Credit: Photo by Alex Wong/Getty Images)

Rep. Ron Paul, R-Tex., and his son, Sen. Rand Paul, R-Ky., both blasted Tea Party critics on Monday for suggesting that the conservative movement with which they’re both linked may have had something to do with America’s recent credit downgrade by the ratings agency Standard & Poor’s.

The elder Paul, a longtime lawmaker, staunch libertarian, and presidential candidate, decried the allegations as an “attempt to scapegoat” Tea Party lawmakers. He pinned the downgrade on the Washington establishment.


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Ron Paul’s Statement on the Budget Control Act



This evening Congress is asked to vote for a bill that claims to reduce spending in the future, thereby accepting the fiction that legislation passed today somehow can control Congress in the future. The fate of legislation like Gramm-Rudman-Hollings in 1985 and the 1997 Balanced Budget Act prove the fallacy that laws passed today somehow will restrain congressional spending in the future.

More recently, I would remind my colleagues that the legislation creating the Medicare Part D prescription drug plan contained language requesting congressional action to control Medicare costs when program expenditures reached a certain “trigger.” When this trigger was reached, Congress simply passed legislation delaying the date at which Congress would have to implement the cost controls supposedly mandated by the original bill.

The claim that spending cuts in this bill equal the amount by which it increases the debt ceiling also is mistaken. First, as explained above, it is highly unlikely that Congress will abide by these caps in the future. Second, an immediate $1 trillion increase in borrowing authority does not equal a $1 trillion cut if that cut is phased in over ten years. To pretend otherwise totally ignores the time value of money, not to mention the inevitable erosion of the purchasing power of the U.S. dollar as the Federal Reserve continues desperately to try to breathe life into the stagnating economy via QE 3,4,5,6, etc.

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