Ron Paul to Congress: If Debt Is the Problem, Why Do You Want More of It?

Originally posted by hawkiye
You are so clueless it is sad. Let me ask you a question and lets see if you have any clue at all.

You say "clueless," I say "unburdened by genuflecting hero-worship of a moron from Texas". Tomayto, tomahto.

If government will shut down if they do not raise the debt ceiling then where are they getting the money to pay everyone right now?

it's called "credit," Hawkiye. Since you support Ron Paul, i'm not going to assume you know how this works. So here's an explanation.

Basically, the US government is cutting checks for its multitudes of employees; they are giving the government their labor, and in return, they get these banknotes, tokens, etc, that basically say "Trust me, I'm good for it." Now, historically, the Treasury has been "good for it." Thus, when people cash in those tokens of credit, they get value for their labor in a reliable and timely manner. Basically, the US treasury has had a good credit rating; it's "trust me" was worth as much as the actual wealth being entrusted.

The debt ceiling extension is basically the treasury going "Uh... hey, I'm still good for it, but something came up, can you give me another month to pay you back, though?" It's a credit extension.

The other option - defaulting - is the treasury going "Well F# me, turns out I'm not good for it. Sorry." Now, we can't say for certainty what the results of that would be. I for one, while curious, don't really want to put it to experiment, 'cause i know what happens if you or I default on our debts.

Originally posted by robyn

Originally posted by krossfyter
does ron paul have ayn randian views
whats his views on healthcare?

edit on 23-7-2011 by krossfyter because: (no reason given)

As a medical doctor, Ron Paul swore the Hippocratic Oath many decades ago. His entire person and career is a monument to the beauty and sanctity of human life. Ron Paul knows that life without health can be very difficult and is not what it was meant to be. He has personally cared for the poor for many years, without asking anything in return.

For a very good overview visit ...

www.ronpaul.com...

thnx robyn....
yet, he does not support universal health care? how can this be?

Free market means the mega corporations do not get to write laws that place the little guy at a major disadvantage as has been happening with increasing regularity.

.

So true my friend.

I'm tired of these modern day tyrants!I see a lot of back scratching going on between the government and the rich people,and it makes me sick!The less fortunate get stepped on...by cleats..then they wipe their feet.

I want to see proof as to where the money is going exactly!Do we have that right?Shouldn't we have that right?

reply to post by krossfyter


Maybe this will help...

reply to post by TheWalkingFox

he opposes every measure that would result in an increase of taxes - even though doing so is the obvious way of closing the debt.

What about getting the heck out of other countries business for one???

Taxes?

TAX IMPORTS NOT WAGES!

Tax on imports = excise tax, see graph:




LOOK at the BLASTED chart above!

I have explained what can be done in several posts in this thread and in this Thread and in this thread I am not about to repeat myself again.

If you truly want to learn you can at least look at the last thread which has a great deal of good info from several people. It is only three pages. Other wise you can sit back and wait for your "Socialist" UTOPIA. I understand it is scheduled for the year 2025 and will be run by the World Trade Organization

reply to post by krossfyter

detractors of ron pauls healthcare say they cant agree with free market healthcare because look at how our free market businesses are.... no regulation is a disaster.... so they say.

Well we have not had a free market in at least 70 years. I'd love to see these detractors point to some of these supposed free market businesses that are disasters...

in regards to ayn rand...
someone sent me this... thehill.com...

That article is so skewed it is bordering on the ridiculous and almost not worth responding to.

So has former Fed Chairman Alan Greenspan, whose monetary policies, not unrelated to his admiration for Ayn Rand, did as much as anyone to cause the financial crash

He says Greenspan was an Ayn Rand advocate and his Randian views were not unrelated to his policies at the federal reserve which is completely laughable. The federal reserve is the anti-thesis to free markets and Greenspans talk did not match his walk and completely ignored his free market rhetoric.

Ayn Rand, like Karl Marx, was a strong disbeliever in the values of organized religion, and Jesus Christ in particular. Ayn Rand, a fierce and aggressive critic of President Kennedy, was a strong disbeliever in the concept of patriotism that involves sacrifice for others.

Ron Paul is an admitted Christian and almost became a minister. He also is a staunch patriot. This guy s using a straw man argument. Ayn Rand was not a disbeliever in patriotism but in blind obedience to government as does Ron Paul.

The core of Ayn Rand's view, incorporated into many of the policies of Dr. Paul and certain (but not all) Tea Party believers, is that the poor are poor because they are inferior, that workers are jobless because they are inferior (how many times have Ayn Rand believers opposed jobless benefits, falsely believing the jobless would rather have the benefits than the jobs?). thehill.com...

This is such a ridiculous statement and inflammatory. This guys is using typical obfuscatory tactics here claiming he want respectful discussion then makes statements like this. Ron Paul does not believe the poor are poor because they are inferior. We all know there are people who take advantage of the system but the main culprit is government intervention killing jobs. Government does not create jobs they only kill jobs! All the arguments over job creation is a misnomer. The only question is if they kill more or less jobs If government regulates and taxes heavily they kill more jobs. If they lighten those they kill less jobs. Either way they are job killers! And government jobs do not contribute to the economy they take away from it in taxes money that would be spent creating more jobs and expanding the economy by producing goods or services that are tangible and actually worth something.

If you want to understand Ron Paul why not listen to what he has to say and look at his near perfect track record for the last 30+ years to see if his talk matches his walk instead of listening to his detractors. Start here: www.ronpaularchive.com...

thnx hawkiye... reading thru that. preciate it.

reply to post by TheWalkingFox

...Basically, the US government is cutting checks for its multitudes of employees; they are giving the government their labor, and in return, they get these banknotes, tokens, etc, that basically say "Trust me, I'm good for it.".....

WRONG!

This is long but I suggest you read every word of it. It is the poor Factory workers and sales clerks that are getting fleeced and this is how it is done.

Those pretty green slips of paper in your wallet commonly known as U.S. dollars are Federal Reserve Notes. Bank scrip. The Fed can print as much of it as it wants or needs to. With this in mind, consider that fully eighty percent (80%) of U.S. Treasuries (U.S. government debt) sold in 2009 were bought by the Fed because there were no other willing buyers. factsnotfantasy.blogspot.com...

When the Bernanke doubled the US money supply it was done by banks LENDING the new money into the system. That is how "new money" is created in a fiat money system.

Of course those in the know were not about to get "sheared" along with the sheeple so when Nixon took the USA off the gold standard they made sure their wages kept up with inflation unlike the poor smucks in the factories and offices. In 1976 A typical American CEO earned 36 times as much as the average worker. By 2008 the average CEO pay increased to 369 times that of the average worker.


This evidence from 1939 gives a very concise view of how 1% of the population transferred wealth from the other 99% of the population directly into their pockets. And Bernanke just switched from Alan Greenspan's teaspoon to a fleet of bucket loaders!

Appendix E – Money Is Created by Banks Evidence Given by Graham Towers

Some of the most frank evidence on banking practices was given by Graham F. Towers, Governor of the Central Bank of Canada (from 1934 to 1955), before the Canadian Government's Committee on Banking and Commerce, in 1939. Its proceedings cover 850 pages. (Standing Committee on Banking and Commerce, Minutes of Proceedings and Evidence Respecting the Bank of Canada, Ottawa, J.O. Patenaude, I.S.O., Printer to the King's Most Excellent Majesty, 1939.) Most of the evidence quoted was the result of interrogation by Mr. “Gerry” McGeer, K.C., a former mayor of Vancouver, who clearly understood the essentials of central banking. Here are a few excerpts:

Q. But there is no question about it that banks create the medium of exchange?

Mr. Towers: That is right. That is what they are for... That is the Banking business, just in the same way that a steel plant makes steel. (p. 287)

The manufacturing process consists of making a pen-and-ink or typewriter entry on a card in a book. That is all. (pp. 76 and 238)

Each and every time a bank makes a loan (or purchases securities), new bank credit is created — new deposits — brand new money. (pp. 113 and 238)

Broadly speaking, all new money comes out of a Bank in the form of loans.

As loans are debts, then under the present system all money is debt. (p. 459)

Q. When $1,000,000 worth of bonds is presented (by the government) to the bank, a million dollars of new money or the equivalent is created?

Mr. Towers: Yes.

Q. Is it a fact that a million dollars of new money is created?

Mr. Towers: That is right.

Q. Now, the same thing holds true when the municipality or the province goes to the bank?

Mr. Towers: Or an individual borrower.
www.michaeljournal.org...

This is the nitty gritty of how the transfer is made.

New money does not appear magically in equal percentages in all people's bank accounts or under their mattresses. Money spreads unevenly, and this process has varying effects on individuals, depending on whether they receive early or late access to the new money.....

Mises argued that the losses of the late-coming losers are the source of income for the early arrival winners....

...This indicates a fundamental aspect of Mises's monetary theory that is rarely mentioned: the expansion or contraction of money is a zero-sum game.... The economic benefits obtained by the early users of new money, even gold, are made at the expense of those who gain access to it after it has altered the array of prices.... www.lewrockwell.com...

As the pro-socialist and millionaire economics textbook author Robert Heilbroner finally admitted in The New Yorker in 1990, "Mises was right."



if you have any doubts at all about the CRIMINAL INTENT of those who conspired on Jekyll Island to bring about the Federal Reserve Act of 1913. Here are the words of the organizer Nelson W. Aldrich, United States Senator, the worst traitor in the history of the USA.

Of all the contrivances for cheating the laboring classes of mankind, none is so effectual as that which deludes them with paper money. It is the most perfect expedient ever invented for fertilizing the rich man’s fields by the sweat of the poor man’s brow. Ordinary tyranny, oppression, excessive taxation, these bear lightly on the happiness of the community compared with fraudulent currencies and the robberies committed by depreciated paper. [inflation cv] Our own history has recorded enough, and more than enough, of the demoralizing tendency, the injustice and intolerable oppression on the virtuous and well disposed, of a degraded paper currency, authorized by law, or in any way countenanced by Government. ~Nelson W. Aldrich, United States Senator, at a New York City dinner speech on October 15, 1913 IV Proceedings of the Academy of Political Science #1, at 38 (Columbia University, New York (1914)). [He was quoting Andrew Jackson. cv] www.linuxtoday.com...

The Average credit card debt per household is $14,687 this does not include education loans, car loans and house mortgages. 97% of the US money supply is in the form of banks loans.- Interesting that the US dollar has lost 96% of its value since the Federal Reserve Act.

So what do we get in return for our obligation to pay all those loans with money we earn through our labor??? The US banks are now operating on an effective ZERO reserve In other words they loan us NOTHING and the entire US is paying INTEREST on 97% of the US money supply! On june 1st 2011,the money supply was $2647.969 BILLION. The banks are earning interest on $2568.53 billion dollars!

First National Bank of Montgomery vs. Daly (1969)

Mr. Morgan, the bank's president, took the stand. To everyone's surprise, Morgan admitted that the bank routinely created money "out of thin air" for its loans, and that this was standard banking practice. "It sounds like fraud to me," intoned Presiding Justice Martin Mahoney amid nods from the jurors. In his court memorandum, Justice Mahoney stated:

Plaintiff admitted that it, in combination with the Federal Reserve Bank of Minneapolis, . . . did create the entire $14,000.00 in money and credit upon its own books by bookkeeping entry. That this was the consideration used to support the Note dated May 8, 1964 and the Mortgage of the same date. The money and credit first came into existence when they created it. Mr. Morgan admitted that no United States Law or Statute existed which gave him the right to do this. A lawful consideration must exist and be tendered to support the Note.

www.webofdebt.com...

So given we are stuck with a fiat currency and the FED more than doubled the money supply, why hasn't the USA seen hypeinflation??? I finally found a reasonable explanation.

...Given the previous hyperinflation, clearly there was ample reason for currency revulsion. So you can consider this argument a necessary but not sufficient precondition. What makes the universal acceptance stick is that government accepts its own money to expunge liabilities to it. In plain English, fiat money has value because it is the only money you can use to pay taxes. ....The fact that this money is also the medium of exchange only entrenches its use. So the tax liability is a necessary pre-condition for fiat currency to work, something I will return to....

[No wonder Amendment 16 - Status of Income Tax Clarified was Ratified 2/3/1913, a couple months after the Federal Reserve Act. cv]


Weimar Germany 1919-1923

The key to Weimar's hyperinflation was two-fold.

1. The German government had a large foreign currency debt obligation.
2. The German economy lost huge amounts of productive capacity causing prices to soar as demand outstripped supply....


Zimbabwe

While the facts in Zimbabwe are different, the underlying causes for hyperinflation were the same: foreign currency obligations and a loss of productive capacity.

Zimbabwe had established Independence from Britain in 1980. Yet, by the late 1990s 70% of productive arable land was still held by the small minority 1% of white farmers in the country. After years of talk about redistribution, in 2000, the President Robert Mugabe began to redistribute this land.

The redistribution process was a disaster, .... With agricultural production having plummeted, Zimbabwe was forced to pay to import food in hard currency.

Meanwhile, the government turned to the printing presses to fulfil its domestic obligations. as in Germany, the foreign currency obligations, the loss of productive capacity and the money printing was a toxic brew which ended in hyperinflation.

Hyperinflation in the USA, May 2010

As you can see from the two most severe cases of hyperinflation, the problem in each case was a loss of productive capacity, foreign currency liabilities, and a loss of the ability to tax....

In the German example, the Germans had a huge foreign currency liability that it had to pay, meaning it could not make good on the liability by printing money. It was a currency user as far as these liabilities went. Meanwhile, with productive capacity limited, the government was then unable to ease price pressure through the tax lever. The shortage of goods drove up prices inexorably and the government was forced to turn to the printing press in order to meet its domestic obligations.

In the Zimbabwe example, taxes were again central. Unable to recoup enough tax revenue and with large foreign currency obligations and a loss of productive capacity, the government resorted to printing money in an environment where prices were rising.

So, hyperinflation has very specific preconditions that are not apparent in the U.S..

1. No foreign currency liability: The U.S. dollar is the world's reserve currency so the U.S. can pay for trade goods in U.S. dollars.. The U.S. does not have a peg to gold or some other currency which acts as a de facto foreign currency liability. And the U.S. government has substantially no foreign currency liabilities. All of the debt is issued in domestic currency.

2. Price pressures are still anchored: While commodity prices are rising, they are rising in all currencies, not just in USD. Moreover, their rise will create demand destruction before any hyperinflation could occur. Why? Unemployment is high and capacity utilization is low, meaning there are no inflationary pressures on that front to help push inflation higher before demand destruction sets in.

3. Currency revulsion has not set in: Tax compliance is high in the U.S. We are not talking about Russia, Greece or Argentina where government has had a difficult time in raising tax. Moreover, as the USD is still the world's reserve currency, there has been no freefall sell off of dollars, nor do I anticipate any in the near-to-medium term.

In short, there will be no hyperinflation in the U.S. any time soon.... www.creditwritedowns.com...

The article states tax compliance is high in the U.S yet the Grace Commission Report to the President (1984) states"...one-third of all their taxes escapes collection from others as the underground economy blossoms in direct proportion to tax increases and places even more pressure on law abiding taxpayers, promoting still more underground economy-a vicious cycle that must be broken...." Now we have a 20% unemployment rate and the retiring of the baby boomers as well as a federal debt increase from fiscal 1983 deficit of $195 billion to over $14 TRILLION (Interestingly the report projected $13 trillion by the year 2000)

Second when the price of fuel rises there is a corresponding rise in the price of everything else.

Third the Russians, China and others are calling for a different world reserve currency than the dollar.

Fourth the OPEC oil countries are moving to the Euro instead of the US dollar, that is the real reason for the heating up of the middle east. The Real But Unspoken Reasons For The Iraq War

If the US dollar ever losses reserve currency status all those inflationary birds are going to come home to roost and we are going to be in a world of hurt.

reply to post by TheWalkingFox

it's called "credit," Hawkiye. Since you support Ron Paul, i'm not going to assume you know how this works. So here's an explanation.

Basically, the US government is cutting checks for its multitudes of employees; they are giving the government their labor, and in return, they get these banknotes, tokens, etc, that basically say "Trust me, I'm good for it." Now, historically, the Treasury has been "good for it." Thus, when people cash in those tokens of credit, they get value for their labor in a reliable and timely manner. Basically, the US treasury has had a good credit rating; it's "trust me" was worth as much as the actual wealth being entrusted.

The debt ceiling extension is basically the treasury going "Uh... hey, I'm still good for it, but something came up, can you give me another month to pay you back, though?" It's a credit extension.

The other option - defaulting - is the treasury going "Well F# me, turns out I'm not good for it. Sorry." Now, we can't say for certainty what the results of that would be. I for one, while curious, don't really want to put it to experiment, 'cause i know what happens if you or I default on our debts.

So let me play dumb here for a minute and see If I understand what you are saying. You are saying that all government expenses have been paid by credit and never paid back correct? So we are just paying the interest on the credit right? But the current taxes do not cover the interest anymore correct? So they need to borrow more money to pay the interest but at the same time are now creating more interest by going into more debt to pay existing debt. Do I have that right in what you are saying?

So what about all those taxes they still take in every year? Will they just stop coming in now? If not why do we need more credit why can't we just stay where we're at and stop spending more using the credit card and creating more interest or in other words perpetual never ending ever increasing debt that can never be paid off? In your check book can you borrow and go into debt to pay existing debt and stay solvent very long?

So if I have this right why can't we just stop making the interest payments all together and use the taxes to pay for government and just cut back and live within what comes in instead of borrowing more and more into oblivion? If we default so what what will happen the Federal reserve will repossess the government LOL! Government wont shut down and we will be forced to live within our means and cut the government pork and fat. Sounds like a good thing to me. What am I missing?

Or better yet why don't we just quit using Federal reserve notes that come with interest and print our own interest free notes?

reply to post by hawkiye


How is that article skewed? U are more than likely correct but I want know where its skewed to? Thnx.

reply to post by RUSSO


Three words:

Fraction reserve banking

Three more

KILL THE FED

Originally posted by krossfyter
reply to post by hawkiye

 

How is that article skewed? U are more than likely correct but I want know where its skewed to? Thnx.

I quoted some of the more skewed comments in my previous post and explained how. Basically the guy is making false claims about Ron Paul, Ayn Rand, and Allen Greenspans beliefs and actions.

reply to post by hawkiye

....So if I have this right why can't we just stop making the interest payments all together and use the taxes to pay for government and just cut back and live within what comes in instead of borrowing more and more into oblivion? if we default so what what will happen the Federal reserve will repossess the government LOL! Government wont shut down and we will be forced to live within our means and cut the government pork and fat. Sounds like a good thing to me. What am I missing....

If we default they will not let us import stuff from China any more sniff sniff

We will have to manufacture our OWN good and hire AMERICANs sniff sniff.

Let us look at Iceland:

Iceland is all but officially bankrupt
Thursday, October 9, 2008

REYKJAVIK — People go bankrupt all the time. Companies do, too. But countries?

Iceland was on the verge of doing exactly that on Thursday as the government shut down the stock market and seized control of its last major independent bank. That brought trading in the country's currency to a halt, with foreign banks no longer willing to take Icelandic krona, even at fire-sale rates.

As the meltdown in the Icelandic financial system quickened, with the government seemingly powerless to do anything about it, analysts said there was probably only one realistic option left: for Iceland to be bailed out by the International Monetary Fund.

"Iceland is bankrupt," said Arsaell Valfells, a professor at the University of Iceland. "The Icelandic krona is history. The IMF has to come and rescue us."....

www.nytimes.com...

If I recall Iceland told the bankers and the IMF where to stick it... without vaseline.

Now it is two years later.

Iceland Bankruptcy-to-Rebound Reveals Models Ireland Won't Take
By Kati Pohjanpalo and Omar R. Valdimarsson - Dec 2, 2010 10:59 AM ET

Iceland is betting its decision two years ago to force bondholders to pay for the banking system’s collapse may help it rebound faster than Ireland.

Iceland’s taxpayers face a smaller debt burden than their Irish counterparts, where the government’s guarantee of the financial system in 2008 backfired this year when the banks came close to insolvency. Iceland’s budget deficit will be 6.3 percent of gross domestic product this year and will vanish by 2012, compared with the 32 percent shortfall in Ireland, the European Commission estimates.

While analysts expect Iceland’s recession to extend into next year, the nation’s exporters are benefiting from a 28 percent drop in the krona against the dollar since September 2008. The decline may help the nation of 320,000 people rebalance its economy faster than Ireland, whose euro membership rules out a currency devaluation. With Iceland’s OMX share index up 17 percent this year, the third-biggest gain in Europe after Denmark and Sweden, Nobel Prize-winning economist Paul Krugman says Iceland may be an example of “bankrupting yourself to recovery.”

“The difference is that in Iceland we allowed the banks to fail,” Iceland President Olafur R. Grimsson said in a Nov. 26 interview with Bloomberg Television’s Mark Barton. “These were private banks and we didn’t pump money into them in order to keep them going; the state did not shoulder the responsibility of the failed private banks.”

www.bloomberg.com...

Seems the TOO BIG TO FAIL BAILOUTS were the USA's biggest mistake....

Originally posted by hawkiye
reply to post by TheWalkingFox

 

Or better yet why don't we just quit using Federal reserve notes that come with interest and print our own interest free notes?

There it is, the only, and, in the fullness of time and history, the inevitable solution.

A clean break, a fresh start. Money is just perception.

Let the entire house of cards crumble, kill the Fed, repeal the Federal Reserve Act, chase the money changers out of the people's temple, and then re-issue the people's dollar as the measure of economic exchange.

reply to post by robyn


I know one thing for sure : Truth is Contagious.

Here is one of them:

The compromise plan that's being bandied around won't reduce the debt by one red cent. In fact, it will add to it. The plan is to cut the deficit; that is, to lesson how much the federal government overspends. The federal government must live within its means and stop pulling money out of the private sector to buy votes via entitlements.

Speaking of printing money backed by no real wealth: Sen. Coburn: Worst Tax Comes From Government Printing Money

"The worst tax increase in the world is the one that comes through government printing money. Inflating greater than what you can earn on your assets and then diminishing the value of your assets by taking it from you."

I like Ron Paul. I think he is a funny guy and some of his ideas I agree with.

However, DEBT is not what we should be focusing on right now.

We should be focusing on creating jobs. For those of you who have jobs, it doesn't seem like a big issue.

But underemployment is at 16%!

First jobs, then we'll tackle the debt.

Originally posted by crimvelvet
reply to post by hawkiye

 

If we default they will not let us import stuff from China any more sniff sniff

We will have to manufacture our OWN good and hire AMERICANs sniff sniff.

That's an interesting idea.

Even when uits right in front of them and they cant get off there fckin sleeping syndrome and use some fking common sense... deception is right in front damn ppl are oblivious

VoTE RoN PAUL almost said vote raon 20 12 for paul

reply to post by ren1999

We should be focusing on creating jobs....

That is why I recommend getting rid of the so called "Free Trade" agreements and Tax the heck out of imported products. Raise the cost of imports to ABOVE the cost of American made products.

That was what tariffs are all about.

What Does Tariff Mean?
A taxation imposed on goods and services imported into a country. Also known as a duty tax.


...Tariff [explained]
Governments generally impose tariffs to raise revenue and protect domestic industries from foreign competition caused by factors like government subsidies, or lower priced goods and services.
www.investopedia.com...

This sums up my feelings on the subject of tariffs. Tariffs are a means by which a country can protect itself from the games played by the International bankers and middlemen with their international currency exchange rates that skew any real hope of an actual "free market" - the fair exchange of my labor and assets for those of another.

Tariffs and Trade

Article I, Section 8, of the Constitution states that Congress shall have the power "To regulate Commerce with foreign Nations."

...Article I, Section 8 provides that duties, imposts, and excises are legitimate revenue-raising measures on which the United States government may properly rely....

...Tariffs are not only a constitutional source of revenue, but, wisely administered, are an aid to preservation of the national economy. Since the adoption of the 1934 Trade Agreements Act, the United States government has engaged in a free trade policy which has destroyed or endangered important segments of our domestic agriculture and industry, undercut the wages of our working men and women, and totally destroyed or shipped abroad the jobs of hundreds of thousands of workers.....

www.constitutionparty.com...