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Congressman Ron Paul Blog: January 2010 BannerFans.com

Sunday, January 31, 2010

Healthcare Plan Based on Economic Fantasy by Congressman Ron Paul

As the healthcare debate rages on, there is one reality that even the proponents of this hostile takeover of healthcare by government cannot ignore – and that is money. The government simply does not have the money for a new, expansive, public healthcare plan. The country is in a deep recession that will deepen even further with the coming collapse of the commercial real estate market. The last thing we need is for government to increase and expand taxes to pay for another damaging, wasteful program. Foreigners are becoming less enthusiastic about buying our debt, and creating another open-ended welfare program when we cannot pay for what is already in place, will not help. Champions of socialized medicine want to tax the rich, tax businesses that already cannot afford to provide health plans to employees, and tax people who don’t want to participate in the government’s scheme by buying an approved healthcare plan. Presumably, all these taxes are to induce compliance. This is not freedom, nor will it improve healthcare.

There are limits to how much government can tax before it kills the host. Even worse, when government attempts to subsidize prices, it has the net effect of inflating them instead. The economic reality is that you cannot distort natural market pressures without unintended consequences. Market forces would drive prices down. Government meddling negates these pressures, adds regulatory compliance costs and layers of bureaucracy, and in the end, drives prices up.

The non-partisan CBO estimates that the healthcare plan will cost almost a trillion dollars over the next ten years. But government crystal balls always massively underestimate costs. It is not hard to imagine the final cost being two or three times the estimates, even though the estimates are bad enough.

It is still surreal that in a free country we are talking only about HOW government should fix healthcare, rather than WHY government should fix healthcare. This should be between doctors and patients. But this has been the discussion since the 60’s and the inception of Medicare and Medicaid, when government first began intervening to keep costs down and make sure everyone had access. The result of Medicaid/Medicare price controls and regulatory burden has been to drive more doctors out of the system – making it more difficult for the poor and the elderly to receive quality care! Seemingly, there are no failed government programs, only underfunded ones. If we refuse to acknowledge common sense economics, the prescription will always be the same: more government.

Make no mistake, government control and micromanagement of healthcare will hurt, not help healthcare in this country. However, if for a moment, we allowed the assumption that it really would accomplish all they claim, paying for it would still plunge the country into poverty. This solves nothing. The government, like any household struggling with bills to pay, should prioritize its budget. If the administration is serious about supporting healthcare without contributing to our skyrocketing deficits, they should fulfill promises to reduce our overseas commitments and use some of those savings to take care of Americans at home instead of killing foreigners abroad.

The leadership in Washington persists in a fantasy world of unlimited money to spend on unlimited programs and wars to garner unlimited control. But there is a fast-approaching limit to our ability to borrow, steal, and print. Acknowledging this reality is not mean-spirited or cruel. On the contrary, it could be the only thing that saves us from complete and total economic meltdown.

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We Can End The Fed by Ron Paul

What unprecedented anti-Fed days these have been! We had our Audit the Fed Congressional hearing, in which the central bank – for the first time in 96 years – was put on the defensive. End the Fed was chosen as a Main Selection of the Conservative Book Club; this book, the first anti-central banking bestseller in American history, debuted at #2 on Amazon.com and #6 on the New York Times and Wall Street Journal bestseller lists.

End The Fed – which the Mises Institute's Lew Rockwell calls “readable and persuasive beyond belief” – can climb up the NYT and WSJ lists week by week, eventually reaching #1, if you help me. Please, buy a copy. Buy one for a friend or family member. Spread the word. One businessman bought copies for all his 23 employees. Others have given them to students, a favorite use of mine.

Since 1913, the Fed has had it all its own way: booms and busts, dollar depreciation, redistribution to the government and the big banks from the middle and working classes. But just as Andrew Jackson abolished the predecessor of the Fed, we too can knock over this dangerous institution. End The Fed teaches all the fascinating history, and tells us what we can do for the future. It gives the constitutional, economic, moral, and libertarian arguments against what Jackson called "the Monster."

Ever seen the Fed’s marble palace in Washington, DC, on Constitution Avenue (of all streets!)? That bunch sure knows how to live. I’ve long had a dream of being the auctioneer when the Fed is sold off for private offices, or maybe a Museum of Sound Money! Help me dull its scissors and then break them, so the Fed can’t cut down our dollar’s value. Indeed, I believe that people ought to be ashamed to work at such a place; an institution that has done so much damage to American prosperity and freedom, as well as to the freedom and prosperity of the whole world. For example, I want no more bowing and scraping to the Fed chairman when he goes to Capitol Hill to peddle his nonsense. He is just a bureaucrat, albeit a disastrous one.

Together, you and I can change things. Indeed, we must. Buy End The Fed. Get copies for those you love. Certainly get copies for those who disagree with us. For all our futures, nothing is as important as cutting the Fed down to size. Join me: let’s End the Fed.

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Starve the Iranians? No! by Ron Paul

Before the House of Representatives: Statement Opposing the Iran Refined Petroleum Sanctions Act, December 15, 2009

I rise in strongest opposition to this new round of sanctions on Iran, which is another significant step toward a US war on that country. I find it shocking that legislation this serious and consequential is brought up in such a cavalier manner. Suspending the normal rules of the House to pass legislation is a process generally reserved for “non-controversial” business such as the naming of post offices. Are we to believe that this House takes matters of war and peace as lightly as naming post offices?

This legislation seeks to bar from doing business in the United States any foreign entity that sells refined petroleum to Iran or otherwise enhances Iran’s ability to import refined petroleum such as financing, brokering, underwriting, or providing ships for such. Such sanctions also apply to any entity that provides goods or services that enhance Iran’s ability to maintain or expand its domestic production of refined petroleum. This casts the sanctions net worldwide, with enormous international economic implications.

Recently, the Financial Times reported that, “[i]n recent months, Chinese companies have greatly expanded their presence in Iran's oil sector. In the coming months, Sinopec, the state-owned Chinese oil company, is scheduled to complete the expansion of the Tabriz and Shazand refineries – adding 3.3 million gallons of gasoline per day.”

Are we to conclude, with this in mind, that China or its major state-owned corporations will be forbidden by this legislation from doing business with the United States? What of our other trading partners who currently do business in Iran’s petroleum sector or insure those who do so? Has anyone seen an estimate of how this sanctions act will affect the US economy if it is actually enforced?

As we have learned with US sanctions on Iraq, and indeed with US sanctions on Cuba and elsewhere, it is citizens rather than governments who suffer most. The purpose of these sanctions is to change the regime in Iran, but past practice has demonstrated time and again that sanctions only strengthen regimes they target and marginalize any opposition. As would be the case were we in the US targeted for regime change by a foreign government, people in Iran will tend to put aside political and other differences to oppose that threatening external force. Thus this legislation will likely serve to strengthen the popularity of the current Iranian government. Any opposition continuing to function in Iran would be seen as operating in concert with the foreign entity seeking to overthrow the regime.

This legislation seeks to bring Iran in line with international demands regarding its nuclear materials enrichment programs, but what is ironic is that Section 2 of HR 2194 itself violates the Nuclear Non Proliferation Treaty (NPT) to which both the United States and Iran are signatories. This section states that “[i]t shall be the policy of the United States…to prevent Iran from achieving the capability to make nuclear weapons, including by supporting international diplomatic efforts to halt Iran's uranium enrichment program.” Article V of the NPT states clearly that, “[n]othing in this Treaty shall be interpreted as affecting the inalienable right of all the Parties to the Treaty to develop research, production and use of nuclear energy for peaceful purposes without discrimination and in conformity with articles I and II of this Treaty.” As Iran has never been found in violation of the NPT – has never been found to have diverted nuclear materials for non-peaceful purposes – this legislation seeking to deny Iran the right to enrichment even for peaceful purposes itself violates the NPT.

Mr. Speaker, I am concerned that many of my colleagues opposing war on Iran will vote in favor of this legislation, seeing it as a step short of war to bring Iran into line with US demands. I would remind them that sanctions and the blockades that are required to enforce them are themselves acts of war according to international law. I urge my colleagues to reject this saber-rattling but ultimately counterproductive legislation.


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Economy Flounders, Despite the Stimulus by Congressman Ron Paul

A year after a nearly $800 billion stimulus package was passed, the U.S. economy still finds itself mired in mediocrity.

Economic growth is stagnant, unemployment remains higher than almost any time since the Great Depression and millions of Americans are upset that trillions of taxpayer dollars have been committed to numerous government bailout programs with no improvement of the economy within sight.

They question, rightfully, where this money is going and why it hasn't been as helpful as the government has claimed.

The problems with stimulus packages are manifold. The primary reason they fail is because they do not address the roots of the problem. If you are unable to identify the cause of your problem, then your solution is doomed to fail.

In the case of the current economic crisis, it had its root in loose monetary policy and easy credit that skewed the allocation of resources within the economy.

Combined with other measures to promote home ownership, these easy money policies caused a massive housing bubble. Money that would have been put to other uses was used to produce raw materials, hire workers and loaned to homebuyers, all while home prices spiked.

The boom was, of course, unsustainable, as many prognosticators pointed out during the housing bubble's peak. But the damage was done, and now that the bubble has burst, we need to stand back and allow the mess to unwind. Yet the government does everything in its power to stave off true recovery and is attempting to re-inflate the bubble.

Rather than allow prices to fall so that the housing market returns to a sustainable level, the government does everything in its power to try to keep housing prices elevated.

The reasoning behind the stimulus package was that underconsumption was to blame for the collapse of the housing bubble and the resulting economic crisis. The government seems to think that if consumption can be spurred, then the economy will be return to normal.

In reality, the collapse of the economy was not caused by a sudden lack of consumption but rather a malinvestment of resources into sectors of the economy that were unsustainable without easy credit. The rise in housing prices was not, in fact, indicative of the new normal but rather an indicator that something was seriously wrong.

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Be Prepared for the Worst by Congressman Ron Paul

Any number of pundits claim that we have now passed the worst of the recession. Green shoots of recovery are supposedly popping up all around the country, and the economy is expected to resume growing soon at an annual rate of 3% to 4%. Many of these are the same people who insisted that the economy would continue growing last year, even while it was clear that we were already in the beginning stages of a recession.

A false recovery is under way. I am reminded of the outlook in 1930, when the experts were certain that the worst of the Depression was over and that recovery was just around the corner. The economy and stock market seemed to be recovering, and there was optimism that the recession, like many of those before it, would be over in a year or less. Instead, the interventionist policies of Hoover and Roosevelt caused the Depression to worsen, and the Dow Jones industrial average did not recover to 1929 levels until 1954. I fear that our stimulus and bailout programs have already done too much to prevent the economy from recovering in a natural manner and will result in yet another asset bubble.

Anytime the central bank intervenes to pump trillions of dollars into the financial system, a bubble is created that must eventually deflate. We have seen the results of Alan Greenspan's excessively low interest rates: the housing bubble, the explosion of subprime loans and the subsequent collapse of the bubble, which took down numerous financial institutions. Rather than allow the market to correct itself and clear away the worst excesses of the boom period, the Federal Reserve and the U.S. Treasury colluded to put taxpayers on the hook for trillions of dollars. Those banks and financial institutions that took on the largest risks and performed worst were rewarded with billions in taxpayer dollars, allowing them to survive and compete with their better-managed peers.

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It Is Time To Leave Afghanistan by Ron Paul

Statement before the Foreign Affairs Committee, United States House of Representatives, December 10, 2009

Mr. Speaker thank you for holding these important hearings on US policy in Afghanistan. I would like to welcome the witnesses, Ambassador Karl W. Eikenberry and General Stanley A. McChrystal, and thank them for appearing before this Committee.

I have serious concerns, however, about the president’s decision to add some 30,000 troops and an as yet undisclosed number of civilian personnel to escalate our Afghan operation. This “surge” will bring US troop levels to approximately those of the Soviets when they occupied Afghanistan with disastrous result back in the 1980s. I fear the US military occupation of Afghanistan may end up similarly unsuccessful.

In late 1986 Soviet armed forces commander, Marshal Sergei Akhromeev, told then-Soviet General Secretary Mikhail Gorbachev, "Military actions in Afghanistan will soon be seven years old. There is no single piece of land in this country which has not been occupied by a Soviet soldier. Nonetheless, the majority of the territory remains in the hands of rebels.” Soon Gorbachev began the Soviet withdrawal from its Afghan misadventure. Thousands were dead on both sides, yet the occupation failed to produce a stable national Afghan government.

Eight years into our own war in Afghanistan the Soviet commander’s words ring eerily familiar. Part of the problem stems from a fundamental misunderstanding of the situation. It is our presence as occupiers that feeds the insurgency. As would be the case if we were invaded and occupied, diverse groups have put aside their disagreements to unify against foreign occupation. Adding more US troops will only assist those who recruit fighters to attack our soldiers and who use the US occupation to convince villages to side with the Taliban.

Proponents of the president’s Afghanistan escalation cite the successful “surge” in Iraq as evidence that this second surge will have similar results. I fear they might be correct about the similar result, but I dispute the success propaganda about Iraq. In fact, the violence in Iraq only temporarily subsided with the completion of the ethnic cleansing of Shi’ites from Sunni neighborhoods and vice versa – and all neighborhoods of Christians. Those Sunni fighters who remained were easily turned against the foreign al-Qaeda presence when offered US money and weapons. We are increasingly seeing this “success” breaking down: sectarian violence is flaring up and this time the various groups are better armed with US-provided weapons. Similarly, the insurgents paid by the US to stop their attacks are increasingly restive now that the Iraqi government is no longer paying bribes on a regular basis. So I am skeptical about reports on the success of the Iraqi surge.
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Likewise, we are told that we have to “win” in Afghanistan so that al-Qaeda cannot use Afghan territory to plan further attacks against the US. We need to remember that the attack on the United States on September 11, 2001 was, according to the 9/11 Commission Report, largely planned in the United States (and Germany) by terrorists who were in our country legally. According to the logic of those who endorse military action against Afghanistan because al-Qaeda was physically present, one could argue in favor of US airstrikes against several US states and Germany! It makes no sense. The Taliban allowed al-Qaeda to remain in Afghanistan because both had been engaged, with US assistance, in the insurgency against the Soviet occupation.

Nevertheless, the president’s National Security Advisor, Gen. James Jones, USMC (Ret.), said in a recent interview that less than 100 al-Qaeda remain in Afghanistan and that the chance they would reconstitute a significant presence there was slim. Are we to believe that 30,000 more troops are needed to defeat 100 al-Qaeda fighters? I fear that there will be increasing pressure for the US to invade Pakistan, to where many Taliban and al-Qaeda have escaped. Already CIA drone attacks on Pakistan have destabilized that country and have killed scores of innocents, producing strong anti-American feelings and calls for revenge. I do not see how that contributes to our national security.

The president’s top advisor for Afghanistan and Pakistan, Richard Holbrooke, said recently, “I would say this about defining success in Afghanistan and Pakistan. In the simplest sense, the Supreme Court test for another issue, we’ll know it when we see it.” That does not inspire much confidence.

Supporters of this surge argue that we must train an Afghan national army to take over and strengthen the rule and authority of Kabul. But experts have noted that the ranks of the Afghan national army are increasingly being filled by the Tajik minority at the expense of the Pashtun plurality. US diplomat Matthew Hoh, who resigned as Senior Civilian Representative for the U.S. Government in Zabul Province, noted in his resignation letter that he “fail[s] to see the value or the worth in continued U.S. casualties or expenditures of resources in support of the Afghan government in what is, truly, a 35-year-old civil war.” Mr. Hoh went on to write that “[L]ike the Soviets, we continue to secure and bolster a failing state, while encouraging an ideology and system of government unknown and unwanted by [the Afghan] people.”

I have always opposed nation-building as unconstitutional and ineffective. Afghanistan is no different. Without a real strategy in Afghanistan, without a vision of what victory will look like, we are left with the empty rhetoric of the last administration that “when the Afghan people stand up, the US will stand down.” I am afraid the only solution to the Afghanistan quagmire is a rapid and complete US withdrawal from that country and the region. We cannot afford to maintain this empire and our occupation of these foreign lands is not making us any safer. It is time to leave Afghanistan.

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Should The US Colonize And Militarize Haiti? by Ron Paul

I rise in reluctant opposition to this resolution. Certainly I am moved by the horrific destruction in Haiti and would without hesitation express condolences to those who have suffered and continue to suffer. As a medical doctor, I have through my career worked to alleviate the pain and suffering of others.

Unfortunately, however, this resolution does not simply express our condolences, but rather it commits the US government “to begin the reconstruction of Haiti” and affirms that “the recovery and long-term needs of Haiti will require a sustained commitment by the United States….” I do not believe that a resolution expressing our deep regret and sorrow over this tragedy should be used to commit the United States to a “long-term” occupation of Haiti during which time the US government will provide for the reconstruction of that country.

I am concerned over the possibility of an open-ended US military occupation of Haiti and this legislation does nothing to alleviate my concerns. On the contrary, when this resolution refers to the need for a long-term US plan for Haiti, I see a return to the failed attempts by the Clinton and Bush Administrations to establish Haiti as an American protectorate. Already we are seeing many argue that this kind of humanitarian mission is a perfect fit for the US military. I do not agree.

Certainly I would support and encourage the efforts of the American people to help the people of Haiti at this tragic time. I believe that the American people are very generous on their own and fear that a US government commitment to reconstruct Haiti may actually discourage private contributions. Mr. Speaker, already we see private US citizens and corporations raising millions of dollars for relief and reconstruction of Haiti. I do not believe the US government should get in the way of these laudable efforts. I do express my condolences but I unfortunately must urge my colleagues to vote against this resolution committing the United States government to rebuild Haiti.

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Sunday, January 24, 2010

Senator Ron Paul - Iran Sanctions are Precursor to War

Senator Ron Paul - Iran Sanctions are Precursor to War

Last week the House overwhelmingly approved a measure to put a new round of sanctions on Iran. If this measure passes the Senate, the United States could no longer do business with anyone who sold refined petroleum products to Iran or helped them develop their ability to refine their own petroleum. The sad thing is that many of my colleagues voted for this measure because they felt it would deflect a military engagement with Iran. I would put the question to them, how would Congress react if another government threatened our critical trading partners in this way? Would we not view it as asking for war?

This policy is pure isolationism. It is designed to foment war by cutting off trade and diplomacy. Too many forget that the quagmire in Iraq began with an embargo. Sanctions are not diplomacy. They are a precursor to war and an embarrassment to a country that pays lip service to free trade. It is ironic that people who decry isolationism support actions like this.

If a foreign government attempted to isolate the US economically, cut off our supply of gasoline, or starve us to death, would it cause Americans to admire that foreign entity? Or would we instead unite under the flag for the survival of our country?

Senator Ron Paul - Iran Sanctions are Precursor to War

We would not tolerate foreign covert operations fomenting regime change in our government. Yet our CIA has been meddling in Iran for decades. Of course Iranians resent this. In fact, many in Iran still resent the CIA’s involvement in overthrowing their democratically elected leader in 1953. The answer is not to cut off gasoline to the Iranian people. The answer is to stay out of their affairs and trade with them honestly. If our operatives were no longer in Iran, they would no longer be available as scapegoats for the regime to, rightly or wrongly, blame for every bad thing that happens. As bad as other regimes may be, it is up to their own people to deal with them so they can achieve true self-determination. When foreigners instigate regime change, the new government they institute is always perceived as serving the interest of the overthrowing country, not the people. Thus we take the blame for bad governance twice. Instead we should stay out of their affairs altogether.

With the exception of the military industrial complex, we all want a more peaceful world. Many are hysterical about the imminent threat of a nuclear Iran. Here are the facts: Iran has never been found out of compliance with the nuclear non-proliferation treaty (NPT) they signed. However, being surrounded by nuclear powers one can understand why they might want to become nuclear capable if only to defend themselves and to be treated more respectfully. After all, we don’t sanction nuclear capable countries. We take diplomatic negotiations a lot more seriously, and we frequently send money to them instead. The non-nuclear countries are the ones we bomb. If Iran was attempting to violate the non-proliferation treaty, they could hardly be blamed, since US foreign policy gives them every incentive to do so.

Senator Ron Paul - Iran Sanctions are Precursor to War

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