Ron Paul in End the Fed, by Rep. Ron Paul (R, TX)

On Budget & Economy: Fed has ominous power with no oversight & no control

Volcker assured me he would never lower reserve requirements to that degree or buy up worthless assets; just the authority to have free rein in raising reserve requirements at will. I said that, although I didn't expect that he would use these extreme powers, who knew if in the future we might just have someone who would. The future is now here.

The fact is that not only has this come to pass with Bernanke, but a great deal more authority has been usurped by Fed, while Congress says little about it. The Fed today has ominous powers that Congress barely understands. There is essentially no oversight, no audit, and no control. And the Federal Reserve chairman has no obligations to answer questions. Trillions of dollars can be created and injected into the economy with no obligation by the Fed to reveal who benefits.

On Budget & Economy: Paper money in unconstitutional; only gold is legal tender

The Constitution is clear about no paper money. Only gold and silver were to be legal tender. Since the states caused themselves harm whe they issued their own paper money, the states were prohibited as well from issuing paper currency in Article I, Section 10. So there you have it, plain and simple: paper money is unconstitutional, period.

The Constitution is silent on the issue of a central bank, but the Tenth Amendment is quite clear: if a power is not "delegated to the United States," it doesn't exist. There is no mention whatsoever of a central bank being authorized. Even is a central bank were permissible, it could not legally repeal the legal tender mandate for gold and silver coins.

Because of the runaway inflation of the continental dollar in the 1780s and the Founders' disdain for paper, no paper money was officially issued by the US government until the Civil War.

On Corporations: Inflated currency benefits some industry's CEO salaries

It's not a question of being an ideologue. The ideologue label is used to make the morally principled ideology look confrontational and uncaring. This then makes it seem like the immoral philosophy, based on government force, is morally superior. It's always couched in terms of caring for the underdog & not as a bailout of those who have unfairly been benefiting from an economic system artificially stimulated by an inflated currency that benefited certain industries' CEO salarie and workers' wages and benefits.

Very simply, there can't be a more immoral system of money than one based on a banking monopoly that can counterfeit money in secret. The moral argument against the Fed should be enough to dispense with it posthaste.

On Corporations: Auto company nationalization is fascism

No, they come to Washington to demand that innocent Americans bail them out & protect a system that deserves no protection. They beg to be taken over, nationalized, to obey a car czar and sacrifice every bit of self-respect that they might retain.

There's a lot of blame to go around for bringing us to this point: the Fed, the Congress, the courts. But the most abhorrent is the failure of the giants of industry to defend free markets. They are willing to be junior partners with government. Fascism is not on their mind.

I call it "nationalism without a whimper," and the corporate business community is begging for it. The nationalization of industry, while retaining private ownership in name only, is just another word for fascism.

On Free Trade: Market can sort out mess created by central banks

We could not enter Afghanistan. But nearby there was a huge cave set up as an exchange post with goods as numerous as a giant department store's. Russian and Eastern goods were sold, as well as American ad other Western goods. It was peaceful under the earth. Here the people were permitted to trade and converse (authorities on both sides knew of the underground market) because it served the interests of both, while up above, the Cold War raged.

Governments & central banks mess things up, but the market, if it is permitted to operate, is capable of sorting out the mess even under duress. There will always be the underground, smugglers, and the black market, as long as we allow our governments to plunder and control us by making voluntary exchanges and associations illegal. It is government controls themselves that give us a rise to a black market.

On Free Trade: Inflation is regressive & results in protectionism

Inflating is never a benefit to freedom-loving people. It destroys prosperity; feeds the fires of war; & is responsible for recessions. It's deceptive & addictive, and causes delusions of grandeur. Wealth cannot be achieved by creating money by fiat.

Depending on monetary fraud for national prosperity or a reversal of our downward spiral is riskier than depending on the lottery.

Inflation has been used to pay for empires since ancient Rome. And they all end badly. Inflationism and corporatism engender protectionism and trade wars. They prompt scapegoating: blaming foreigners, illegal immigrants, ethnic minorities, and too often freedom itself for the predictable events and suffering that result

On Government Reform: Paper money makes Congress believe it has no spending limit

What the Fed and paper money have done for Congress is lead legislators to believe that there are no limits on what they can spend, on what they can propose, and what they can accomplish. They really do behave like college student on spring break who are using their parents' credit card with no limit. But they would hit the roof is the card were ever declined.

The point is, unless one has a strong love of liberty, ignorance regarding money is not something that most members of Congress regret. This ignorance is what allows conservatives and liberals alike to spend, borrow, tax, and inflate to finance their various programs, both foreign and domestic.

On Government Reform: Introduced Federal Reserve Transparency Act with Sen.Sanders

He may well be protected by the law, but he is in defiance of the Constitution. The courts, under today's circumstances, will never rule that the Federal Reserve Bank chairman must reveal the information that the Congress or the people seek.

One thing I have noticed in studying the issue is that the more power the Fed has gained, the greater the secrecy they demand. Transparency is currently a hot issue in Congress because the people have awoken and have sent a message. This is not a conservative or liberal issue; it's not a Republican or Democratic issue. It is pervasive, across the political spectrum.

I introduced a Federal Reserve audit bill the Federal Reserve Transparency Act, HR 1207, which Bernie Sanders introduced in the Senate.

On War & Peace: Century of war correlates with century of central banking

Now with central banks, governments could just print what they needed, and therefore they were more willing to pull the trigger and pick fights. The diplomats were powerless to stop governments itching to try out their newfound funding machines.

On Welfare & Poverty: Moral hazard permeates a welfare state

Anything that is seen as protection against risk causes people to act with less caution. Even if their actions may seem risky, someone else suffers the consequences, and moral hazard will encourage bad economic behavior.

Moral hazard, from whatever source, is detrimental because it removes the sense of responsibility for one's own actions. Interventionism conditions business people to believe they can enjoy the rewards of the market, yet pass on the penalties to others. That's what's happening today.

Although I'm talking here about financial moral hazard, the whole notion of the safety net permeates a socialist or welfare state, encouraging carelessness and dependency on the government.

On Budget & Economy: Economic crisis demonstrates that Fed must come to an end

We are talking about an awesome power. It is the power to weave illusions that appear real as long as they last. That is the very core of the Fed's power.

Of course not everyone is instinctively against this illusion-weaving power, and many even welcome it. Tragically, the innocent who understand little about the complexity of the monetary system suffer the most, while those who are in the know reap great profit whether the market is going up or down.

On Budget & Economy: Security or growth: you can't have both

Even with a government guarantee, the system is always vulnerable to collapse at the right moments, namely, when all depositors come asking for their money. Banking legislation can be seen as an elaborate attempt to patch th holes in this leaking boat. Thus have we created deposit insurance, established the "too big to fail" doctrine, created schemes for emergency injections, and all the rest, so as to keep afloat a system that is inherently unstable.

On Homeland Security: Politically convenient wars are not at all necessary

On Principles & Values: 1971 dropping of gold standard prompted first run for office

In addition, wage and price controls were put in place. Instead of the markets collapsing, as I thought they would, the move was immediately praised by the Chamber of Commerce, and the stock market soared. The problems came a little bit later and lasted for a decade.

It was the consequences of this event in 1971 that prompted me to decide on a lark in late 1973 to run for Congress in 1974. Texas was still a Democratic state. The district I was running in had never been held by a Republican. My first victory didn't come until a special election in the spring of 1976. At the time, I was just anxious to have a forum in which to talk about monetary policy and its relationship to the inexorable growth of our federal government.

On Tax Reform: Disastrous tax code contributes to underground economy

Our disastrous tax code has contributed substantially to the need for the underground economy. This need will surely grow as the economy further deteriorates. In economic terms, all this activity is beneficial in the underground, despite politicians' cries that the government is being cheated out of hundreds of billions of dollars in tax revenue. If the market quits functioning, the underground economy will expand exponentially. In some other countries the underground market is responsible for keeping the economy afloat.