Congressman Paul believes that the role of government is to remain as small as possible to provide a stable and predictable taxing and regulation structure to allow private industry to flourish. Congressman Paul advocates for both limiting the federal government to the functions allocated to it by the constitution, and ensuring that Congress acts with all the powers granted to it within the constitution.
Congressman Paul promotes an Austrian economic model, which is in direct opposition to Keynesian ideals that government can and should stimulate and direct the economy. He believes that government should maintain a sound money policy, protect the rights of it's citizens, enforce contracts, and regulate industry as little as possible. In handing over control of the monetary supply to the Federal Reserve Bank, growing the size of government beyond reasonable spending levels, and inserting itself into the private market, the federal government has promoted mal-investment, created inflation and the boom/bust cycles, and hindered the private sector. Returning the government to it's defined roles and creating a sound monetary system is Congressman Paul's economic plan.
The first facet of Congressman Paul's economic theory is returning the federal government to it's allocated roles and returning the other functions to the states and to industry. This would include eliminating federal departments such as the Department of Education and Drug Enforecement Agency and returning those functions to the states, and eliminating the Transporation Safety Administration and returing control of security to the airlines. Congressman Paul is quick to point out that although he does not believe the federal government should not be engaging in activity it is not permitted to be involved in does not mean that those industries should not be regulated, it simply should be done at the state level and at the state's discretion. This dramatically reduced federal government would be easier to fund, easier to reign in, and provide for a more stable investment in the US economy through certainty of the rule of law.
The second item in Congressman Paul's economic theory is a sound monetary policy. He strongly opposes the ability of a private company such as the Federal Reserve to control US monetary supply. He repeatedly asserts that the constitution gives only congress the right to coin money and that congress cannot cede that authority to a private entity. He notes that the policies of the Federal Reserve expand and contract monetary supply and cause the cycles of booms and busts, create inflation through deficit spending, and allow for the federal government to grow beyond it's ability to fund itself by providing an unlmited money supply. He advocates for auditing and ending the federal reserve and returning control of the monetary supply to the people through their congress.
A third facet of Congressman Paul's economic theory is reforming the welfare state in the US. He notes that each person has the right to theiry live, their liberty, and the fruits of their labor. He states that a person is not entitled to a free college education, free health care, or any entitlement that would be taken from one person and given to another. He states that this is stealing and the fact that the IRS is taking the funds and not an individual person does not negate that theft. This welfare state also consists of corporate welfare in the form of subsidies and a tax structure designed to favor those with ties to government.
In addition to reigning in the federal government, reforming the welfare state, and restoring sound monertary principles, Congressman Paul advocates for ending the wars in Iraq, Afghanistan, Libya, and all other nations, and bringing the troops home. He asserts that no troops should be participating in conflicts without a declaration of war. He also states that he would close most of the overseas bases noting that it is not the job of the US to provide security to other nations at no cost to them, and not at the discretion of the President to fund the occupation of another nation without a declaration of war.
With the federal government removed from the private sector, the military-industrial complex reduced in scope, the welfare state in check, and control of the monetary supply returned to the people, Congressman Paul states that government will function more effectively as the magnets for corruption will be gone. Without government control of industry, there is no desire on industry's part to corrupt government officials. The final facet of Congressman Paul's economic theory is removal of government regulation wherever possible.
Congressman Paul's legislative record reflects his stated positions. He voiced opposition to government involvement in the housing market and has repeatedly called for the government to cease manipulation of that market. He opposed the TARP legislation, the Obama stimulus, the Bush stimulus, Sarbanes-Oxley, and the GM restructuring loan.
Congressman Paul's 2008 mirrored the facets previously described with the addition of tax reform.
Veto any unbalanced budget Congress sends to his desk.
Refuse to further raise the debt ceiling so politicians can no longer spend recklessly.
Fight to fully audit (and then end) the Federal Reserve System, which has enabled the over 95% reduction of what our dollar can buy and continues to create money out of thin air to finance future debt.
Legalize sound money, so the government is forced to get serious about the dollar’s value.
End the corporate stranglehold on the White House.
Drive down gas prices by allowing offshore drilling, abolishing highway motor fuel taxes, increasing the mileage reimbursement rates, and offering tax credits to individuals and businesses for the use and production of natural gas vehicles.
Eliminate the income, capital gains, and death taxes to ensure you keep more of your hard-earned money and are able to pass on your legacy to your family without government interference.
Oppose all unfunded mandates and unnecessary regulations on small businesses and entrepreneurs.
As part of the 2012 campaign, Congressman Paul put forth the "Restore America Plan"
Spending
Cut $1 trillion in spending during the first year
eliminat Departments of Energy, Commerce, Interior, Education and HUD
Abolish the Transportation Security Administration
Abolish corporate subsidies
Stop foreign aid
End foreign wars
Return most other spending to 2006 levels
Entitlements
Honor our promise to our seniors and veterans, while allowing young workers to opt out
Block grant Medicaid and other welfare programs to States
Cutting Waste
10% reduction in the federal workforce
Slash Congressional pay and perks
Curb excessive federal travel
Presidential salary of $39,336, approximately equal to the median personal income of the American worker
Taxes
Lower the corporate tax rate to 15%
Allow American companies to repatriate capital without additional taxation
Extend all Bush tax cuts
Abolish the Death Tax
End taxes on personal savings
Regulation
Repeal ObamaCare, Dodd-Frank, and Sarbanes-Oxley
Mandate REINS-style requirements
Cancel all onerous regulations previously issued by Executive Order
Monetary Policy
Conducts a full audit of the Federal Reserve
Implement competing currency legislation to strengthen the dollar and stabilize inflation
Section 404 of Sarbanes-Oxley
In April of 2005, Congressman Paul released a press statement noting his support for the repeal of section 404 of Sarbanes-Oxley.
Paul Introduces Legislation to Repeal Section 404 of Sarbanes-Oxley
April 14, 2005 Washington, DC- Congressman Ron Paul of Texas today introduced legislation that repeals a particularly onerous provision of the Sarbanes-Oxley Act. Paul’s legislation, titled “The Due Process and Economic Competitiveness Restoration Act,” seeks to repair damage done to the economy by repealing section 404 of Sarbanes-Oxley and restoring some measure of economic due process rights.
Paul, a member of the House Financial Services committee, termed the 404 provisions anti-business and anti-competitive. “It’s time to make public what the business community already acknowledges privately: Sarbanes-Oxley is a disaster,” Paul stated. “Now that the Enron and Worldcom hysteria is over, it’s time to admit that Congress made a terrible mistake.”
Journalist Robert Novak, in his column of April 7, said that, "[f]or more than a year, CEOs and CFOs have been telling me that 404 is a costly nightmare” and “ask nearly any business executive to name the biggest menace facing corporate America, and the answer is apt to be number 404…a dagger aimed at the heart of the economy.”
Sarbanes-Oxley dramatically raises the cost of doing business, which favors large companies over small competitors. These costs retard economic growth and hurt American workers. It also tramples due process rights by subjecting CEOs and CFOs to criminal penalties for inadvertent accounting errors. Not surprisingly, many American and foreign companies simply have deregistered from U.S. stock exchanges rather than spend millions in compliance costs. Financial analysts have identified section 404 as the major reason why American corporations are hoarding cash instead of investing it in new ventures.
“Congress has zero credibility when it comes to fiscal accountability,” Paul concluded. “Just look at Fannie Mae and Social Security for two obvious examples. More importantly, Congress has no constitutional authority to regulate the accounting standards of private businesses. Every state in the nation has fraud laws on the books, and the market responded to Enron rumors well before Congress held any hearings on the matter. Once again, Congress has presumed to understand what it does not, and regulate what it has no authority to regulate.”
The Bush Stimulus
In January of 2008, Congressman Paul used his "Texas Talk" to discuss a possible stimulus.
Economic Stimulus Concerns
This past week in Washington there has been much talk about the economy. It seems by their actions the leadership and the Fed is finally willing to admit we have a problem, and we need to do something about the economic mess we are in. This is a good thing. However, they are still not being honest about the root cause of our impending crisis and want to deal only with symptoms, not the disease. There are some positive aspects of the highly lauded economic stimulus package that has been negotiated. I am in favor of taxpayers getting some of their money back, however temporary tax cuts and one-time rebates will not “fix” the economy. What we desperately need right now is real deep significant tax cuts that are enabled by big spending cuts and reduction of government waste that is so rampant. Unfortunately, too many in Washington still believe we can spend our way into prosperity, which does not work and never has. Countries build wealth through robust economic environments, in which jobs are created and businesses can operate at a profit and grow. When taxes bleed away profits and burdensome regulation hamstrings operations, our businesses and our jobs go overseas. The United States must foster a competitive business environment once again. There are a few ideas out there for economic stimulus that I do support, such as making permanent President Bush’s tax cuts. I have also signed on as one of 49 original cosponsors of the Economic Growth Act of 2008 which will provide actual economic stimulus through private sector tax relief and job-creating business incentives. This plan features · Full immediate expensing for major business asset investments · Reducing the top corporate tax rate from 35% to 25% to be aligned with average rates in Europe · Indexing the capital gains tax for inflation · Cutting and simplifying the corporate capital gains rate Enactment of these dramatic tax cuts will free up money so employers can start hiring again. I would like for the unemployed to have the satisfaction of having a job again so the standard of living of the American family will go up. And even more than a one-time miniscule rebate check, I want you to keep more of your own money in the first place. Sending out checks and cutting interest rates yet again is merely a shot in the arm when in actuality, the economy needs major surgery. I look forward to working with my colleagues in Congress to provide major tax relief to the American people.
The Fed and the Economy
In April of 2008, Congressman Paul used his "Texas Talk" to address the relationship between the Federal Reserve, the economy, and banks.
Bailing Out Banks
There has been a lot of talk in the news recently about the Federal Reserve and the actions it has taken over the past few months. Many media pundits have been bending over backwards to praise the Fed for supposedly restoring stability to the market. This interpretation of the Fed's actions couldn't be further from the truth.
The current market crisis began because of Federal Reserve monetary policy during the early 2000s in which the Fed lowered the interest rate to a below-market rate. The artificially low rates led to overinvestment in housing and other malinvestments. When the first indications of market trouble began back in August of 2007, instead of holding back and allowing bad decision-makers to suffer the consequences of their actions, the Federal Reserve took aggressive, inflationary action to ensure that large Wall Street firms would not lose money. It began by lowering the discount rates, the rates of interest charged to banks who borrow directly from the Fed, and lengthening the terms of such loans. This eliminated much of the stigma from discount window borrowing and enabled troubled banks to come to the Fed directly for funding, pay only a slightly higher interest rate but also secure these loans for a period longer than just overnight.
After the massive increase in discount window lending proved to be ineffective, the Fed became more and more creative with its funding arrangements. It has since created the Term Auction Facility (TAF), the Primary Dealer Credit Facility (PDCF), and the Term Securities Lending Facility (TSLF). The upshot of all of these new programs is that through auctions of securities or through deposits of collateral, the Fed is pushing hundreds of billions of dollars of funding into the financial system in a misguided attempt to shore up the stability of the system. The PDCF in particular is a departure from the established pattern of Fed intervention because it targets the primary dealers, the largest investment banks who purchase government securities directly from the New York Fed. These banks have never before been allowed to borrow from the Fed, but thanks to the Fed Board of Governors, these investment banks can now receive loans from the Fed in exchange for securities which will in all likelihood soon lose much of their value.
The net effect of all this new funding has been to pump hundreds of billions of dollars into the financial system and bail out banks whose poor decision making should have caused them to go out of business. Instead of being forced to learn their lesson, these poor-performing banks are being rewarded for their financial mismanagement, and the ultimate cost of this bailout will fall on the American taxpayers. Already this new money flowing into the system is spurring talk of the next speculative bubble, possibly this time in commodities. Worst of all, the Treasury Department has recently proposed that the Federal Reserve, which was responsible for the housing bubble and subprime crisis in the first place, be rewarded for all its intervention by being turned into a super-regulator. The Treasury foresees the Fed as the guarantor of market stability, with oversight over any financial institution that could pose a threat to the financial system. Rewarding poor performing financial institutions is bad enough, but rewarding the institution that enabled the current economic crisis is unconscionable.
Neo-Conservative Economic Policies
In June of 2008, Congressman Paul used his "Texas Talk" address to discuss what he calls "neo-conservative" policies and their effects on the economy.
The Dangers of Neo-Conservative Economic Policies
The dangers inherent in the foreign policy advocated by the neo-conservatives are well known. While many Americans have become increasingly aware of those dangers, far less attention has been focused on the dangers of neo-conservative economic policies. This issue is of critical importance right now, because many are mistakenly pointing their fingers at the free market as the culprit behind our current economic plight.
There are only a few in elected office who have any real loyalty to free markets and limited government. The agenda of neo-conservatives in the economy calls for a very active central government. Indeed, while there are some neo-conservatives who continue to use the rhetoric of limited government, and who oppose increases in the federal income tax as a way to maintain the political benefits that apply to those who talk about free markets, it is now the neo-conservatives who promote fiat monetary policies even more than those on the liberal left.
While I have been a strong proponent of cutting taxes on all Americans, and therefore supported the tax reductions offered by President Bush, the neo-cons argue that tax rate reduction alone is the key to “getting the government out of the way” of economic growth. Moreover, they invariably argue for tax reductions targeted toward the wealthy, and toward multinational corporations.
Over the years, I have offered several tax plans designed to assist hard working middle-class Americans to pay for their needs, whether these needs be health-care related, educational or to pay the costs of fuel. A few years back when I introduced one such bill, a prominent Republican approached me on the House Floor and asked, half in anger and half in amazement “why did you do that?” Shortly after that, the committee chairman at the time, also a Republican, sent out a release strongly attacking my tax cut bill.
So, while the liberal economic agenda includes more taxes and spending, the neo-con economic program simply looks to target some tax cuts to preferred groups, but ignore the economic big picture. The neo-con economic agenda is to “borrow and spend” and it is that agenda, even more than the tax and spend ways of many liberals, that has cast us in economic peril at this time.
Simply, on spending, the neo-cons and the liberals share views, just as they share similar views on foreign policy. While each side tries to claim the mantle of change, reality is that more of the same is not change.
The fiat monetary policy we now follow is the most significant factor contributing to our economic peril, and it is central to the neo-con agenda. As we hear new calls to empower the Federal Reserve Board, we should be aware that underlying all neo-conservative policies is the idea of monetary inflation. Inflation is the technique used to pay for the regulatory-state and the costs of policing the world.
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2008 Economic Plan
As part of his 2008 Presidential campaign, Congresman Paul put forth an economic plan which he called a Comprehensive Economic Revitalization Plan. This plan includes tax reform, monetary policy reform, spending reform, and regulatory reform.
America became the greatest, most prosperous nation in human history through low taxes, constitutionally limited government, personal freedom and a belief in sound money. We need to return to these principles so our economy can thrive again. When enacted, my plan will provide both short-term stimulus and lay the groundwork for long-term prosperity.
Other candidates talk a lot about stimulus packages, but my record stands alone. I have fought for these measures for years as a member of Congress and will make them a top priority as president.
Ron Paul, a 10-term Republican Congressman from Texas’s 14th District, is currently the ranking member of the House Financial Services Committee’s Subcommittee on Domestic and International Monetary Policy, Trade, and Technology. He has been named “Taxpayers’ Best Friend” for 10 consecutive years by the National Taxpayers’ Union. Ron Paul is also the author of several books on monetary policy and economics.
The Four-Point Plan
Tax Reform: Reduce the tax burden and eliminate taxes that punish investment and savings, including job-killing corporate taxes.
Spending Reform: Eliminate wasteful spending. Reduce overseas commitments. Freeze all non-defense, non-entitlement spending at current levels.
Monetary Policy Reform: Expand openness at the Federal Reserve and require the Fed to televise its meetings. Return value to our money.
Regulatory Reform: Repeal Sarbanes/Oxley regulations that push companies to seek capital outside of US markets. Stop restricting community banks from fostering local economic growth.
1. Tax Reform
Eliminate Taxes on Dividends and Savings. The basis of capitalism is savings, and Americans who do so should be rewarded.
Pass HJ Res. 23 to encourage savings over consumption.
Repeal the Death Tax. Attacking small businesses and breaking up family farms smothers growth and kills jobs.
Pass H.R. 2734 to make the Bush tax cuts permanent.
Cut Taxes for Working Seniors.Grandmothers and grandfathers working to make ends meet should keep all the fruits of their labor.
Pass H.R. 191 to amend the Internal Revenue Code of 1986 to repeal the inclusion in gross income of Social Security benefits.
Eliminate Taxes on Social Security Benefits. That money belongs to seniors, not the government. They paid into the system for a lifetime, and they should be free to spend every penny as they see fit.
Pass H.R. 192 to amend the Internal Revenue Code of 1986 to repeal the 1993 increase in taxes on Social Security benefits.
Accelerate Depreciation on Investment.We need to help companies grow and create jobs.
Pass H.R. 4995 to amend the Internal Revenue Code of 1986 to reduce corporate marginal income tax rates.
Eliminate Taxes on Capital Gains.Investment should be embraced and rewarded.
Pass H.J. Res 23 (The “Liberty Amendment”), proposing an amendment to the Constitution of the United States relative to abolishing personal income, estate, and gift taxes and prohibiting the United States Government from engaging in business in competition with its citizens.
Eliminate Taxes on Tips.The single parents and working students who earn their income chiefly through tips deserve to keep all of their money. This tax on “estimated income” is unfair and should be ended.
Pass H.R. 3664 to amend the Internal Revenue Code of 1986 to provide that tips shall not be subject to income or employment taxes.
Support the Mortgage Cancellation Relief Act.Working families who lost their homes should not be punished a second time with a big IRS bill.
Pass H.R. 1876 to amend the Internal Revenue Code of 1986 to exclude from the gross income of individual taxpayers discharges of indebtedness attributable to certain forgiven residential mortgage obligations.
2. Spending Reform
Reduce Overseas Military Commitments.Our bases and troops should be on our soil.
It’s time to stop subsidizing our trading partners in Europe, Japan and South Korea.
Freeze Non-Defense, Non-Entitlement Spending at Current Levels
I vote against all bloated, pork laden spending bills and will veto them as president.
3. Monetary Policy Reform
Televise Federal Open Market Committee Meetings. An institution as powerful as the Federal Reserve deserves full public scrutiny.
Expand Transparency and Accountability at the Federal Reserve
Pass H.R. 2754 to require the Board of Governors of the Federal Reserve System to continue to make available to the public on a weekly basis information on the measure of the M3 monetary aggregate and its components.
Return Value to Our Money.Legalize gold and silver as a competing currency.
Level the long-term boom and bust business cycle by passing H.R. 4683, which would repeal provisions of the federal criminal code relating to issuing coins of gold, silver, or other metal for use as current money and making or possessing likenesses of such coins.
4. Regulatory Reform
Repeal Sarbanes/Oxley.It has seriously wounded our capital markets and helped make the UK a financial center at our expense.
Ending these misguided regulations would bring jobs flooding back to the United States
Pass H.R. 1049 to reform Sarbanes-Oxley and reduce the burden it places on small businesses.
Repeal or Remove Costly and Unnecessary Federal Regulations. Neighbors know best how to help their neighbors.
We need to make it easier for community banks, credit unions, and other financial institutions to better serve their communities and to help people in these communities get access to credit and capital.
Pass H.R. 1869 to enhance the ability of community banks to foster economic growth and serve their communities, boost small businesses, increase individual savings, and for other purposes.
Cures for the Economy
In January of 2009, Congressman Paul used his "Texas Talk" address to discuss what really needed to be done to address the economy.
Cures for Our Economic Disease
I have recently had several opportunities on various news programs to discuss the economy and what is wrong with the so-called economic stimulus package. I have said over and over what we shouldn’t be doing, and now I’d like to explain what we should be doing.
But to improve the situation, you must first have a solid grasp of how we got here. Government policies and central planning created the housing bubble, now going bust. About a decade ago the government made expanded homeownership and affordable housing a public goal. Through Fannie Mae, Freddie Mac and the secondary mortgage market the government incentivized creative, low down-payment, more widely available mortgage products, and discouraged the market-proven lending standards of the past. The Federal Reserve kept interest rates artificially low, which added more fuel to this fire. Many related sectors temporarily flourished because of this, and many people got into homes they otherwise could not have afforded. The increased demand for housing sent prices soaring until in many markets housing became even more unaffordable, necessitating even more creative mortgages, and impossibly leveraging homeowners. Many risky investment vehicles such as mortgage-backed securities, derivatives, credit default swaps grew out of this unsustainable situation. As the foreclosures began, the house of cards started to tumble. Too many people have confused the symptoms and the pain of the bust with the problematic policies that caused the bubble, which is really what needs to be treated.
First of all, just as the best cure for a hangover is not to drink so much, the best cure for a recession is a recession. It is time to sober up and return to free market sanity, risk and reward, supply and demand, without political intervention. Politicians are good at catering to the needs of special interests, but very bad at determining what needs to take place in the market. Government should stick to punishing fraud and enforcing contracts. When they use the tax code, bureaucratic departments and their manipulative rules and regulations to dictate social and economic behavior, we end up with distortions and malinvestments. Bailing out banks, continuing failed Fed policies and strapping the taxpayer with toxic debt will worsen the pain, and punish the innocent.
If Congress really wanted to do something helpful, it would cut taxes. Ideally, we would repeal the income tax altogether and get the IRS off the economy’s back, which would be a huge boon. We should also cut spending. Cut every unconstitutional department and program, every wasteful governmental encroachment on the people’s liberty and money, starting with our massive overseas empire. The cost of our empire is bringing us to our knees, just as the Soviets’ empire did to them. Congress should also abolish the Federal Reserve and take back its responsibilities to ensure sound money, safe from the manipulations of powerful banking interests.
These things would constitute real change, real economic stimulus. The plans being bandied about Washington are just more of the same. As long as no one seriously considers the cure, we are unfortunately destined to prolong the disease.
Response to AIG Bonuses
On March 19, 2009 Congress Paul spoke on the House floor about the House's response to the AIG bonuses that were issued after TARP. He notes that the Congress authorized unconstitutional spending to allocate TARP and then when that money causes problems, they push further unconstitutional legislation in the form of bills of attainder to fix that problem.
Floor Speech on the Economy
In June of 2009, Congressman Paul spoke on the House floor about the problems in the economy and the need to understand those problems to address solutions.
Free Market as a Regulator
In August of 2009, Congressman Paul used his "Texas Talk" to address the free market as the best regulator of a sounds economy.
The Free Market as Regulator
Since the bailouts last fall, lawmakers have been behaving as quasi-owners of the bailed-out banks and businesses, leading to calls for increased regulation of executive compensation and other wasteful expenditures. We have heard much about bonuses and executive pay packages that sound more like lottery winnings than an honest salary.
Many lawmakers voted in favor of these unconstitutional bailouts, believing that these corporations were too big to fail, and allowing them to go under would precipitate widespread economic disaster. This second wave of citizen outrage at the bailouts has left these lawmakers with a bit of egg on their face, and once again, they feel the need to "do something" to "fix" it. Shouldn't there be a regulatory structure in place governing executive compensation? Politically, it seems quite feasible. People are outraged that the system has once again gutted the many to make a few at the top fantastically wealthy. But they are incorrectly demonizing the free market.
What we need to realize is that there WAS a regulatory structure in place that was attempting to stop bad management, including overpaying executives. That regulatory structure is the free market, and when poor management brought these companies to the point of bankruptcy, Congress circumvented the wisdom of the free market, and inserted its own judgment at our expense. And now because of that intervention, we will burdened with massive new regulations. We can be certain this effort will fail.
The free market is a naturally occurring phenomenon that can't be eliminated by governments, not even totalitarian ones like the former Soviet Union. It can be regulated, over-taxed and manipulated until it is driven underground. Lately it has been wrongly accused of doing so many things it just doesn't do, that are really the fault of crony corporatism and convoluted government policies that brought on the crisis. Too many people equate the free market with big business doing whatever it wants, but that is not the free market. Unconstitutional taxpayer funded bailouts are what allow giant corporations to run roughshod over the economy. The free market is what puts them out of business when they misbehave.
The free market is you and your neighbors working hard to produce what you produce, and exchanging goods and services voluntarily, in mutually agreeable arrangements. The free market is about respecting property rights and contracts. It is not about building up oligarchs and monopolies and confiscatory tax theft - these are creatures of government.
We must watch out when government comes up with interventionist solutions to interventionist problems. The root of our problems lie in interventionism. Trusting the free market is the solution.
Cash for Clunkers
In August of 2009, Congressman Paul used his "Texas Talk" address to discuss the cask for clunkers program.
Cash for Clunkers
The Cash for Clunkers program has received a lot of attention this week on Capitol Hill and across the country. The program offers a voucher of up to $4500 in federal funds to anyone who trades in a working used car for a new one with better fuel economy. Congress was shocked at how quickly people responded to promises of free money and drained the program, while car dealers have been equally shocked at how slow and arduous the government’s website to claim the rebates has been.
It’s not a shock that people respond to incentives. The program has been deemed a resounding success, and Congress has authorized 2 billion more taxpayer dollars for it. But not everyone is happy about this. Low-income earners who would have been in the market for those perfectly serviceable, working cars will have fewer to choose from, and those cars will probably be more expensive than they normally would have been. Automotive repair shops actively lobbied against this program, as it will destroy many of the cars they would have repaired. They were out-lobbied. And of course, Americans as a whole are hurt, because this additional bailout of auto companies comes at our expense through inflation.
I have introduced a somewhat similar bill that would have provided a much better alternative to Cash for Clunkers because it does not rely on increased government bureaucracy or spending. My bill HR 1768 provides tax credits to people trading in used cars for new cars with better fuel economy. There is a big difference, in my mind, between letting people keep their own money versus giving them someone else’s. It is clear which one a free and fair society would choose. Not only that, but my bill would not have required working, serviceable cars to be destroyed for scrap metal.
Cash for Clunkers is a popular program right now, but in the larger scheme of things it does very little towards accomplishing its stated goals. Requiring cars to be destroyed and new ones made to replace them might help the auto industry in the short run, but any improved fuel economy will not make up for the environmental impact of junking one car and making a new one. So this is not a program that should really make environmentalists happy.
There is also much evidence that the boost in demand for autos, that has made dealers happy, is just borrowed demand from the past and the future. In other words, many have put off purchases they would have made anyway because they were waiting to see what the government would do. Others who would have waited a little longer to trade in a vehicle are accelerating their decisions so they can get in before the money runs out. So I would not be surprised to find that this artificial boom in auto sales is followed by an extended drop. This should serve as a very tangible example of how government meddling in the economy creates booms and busts. While everyone loves the booms, the busts are what creates the crises that government thrives on, and that is what we really need to watch out for!
Government and the Economy
In January of 2010, Congressman Paul used his "Texas Talk" address to discuss causes of the Great Depression and the overburdensome regulations placed on people by the government.
Government is Too Big to Succeed
Last week, the Financial Crisis Inquiry Commission kicked off their first round of hearings on the causes of the economic meltdown on Wall Street. The commission is being compared to the the Pecora Commission launched in 1932 to investigate the causes of the Great Depression. The Pecora commission is beloved by those who believe the solution to every problem is more laws because it was used to justify a number of new laws, including Glass-Steagall. Of course, none of those laws addressed the real causes of the Great Depression. It was the introduction of unsound monetary policy and central economic planning pursued by the Federal Reserve that really threw everything off balance. The Fed was founded in 1913 to stabilize the economy and prevent a recurrence of the short-lived Panic of 1907, but instead it promptly produced the Great Depression which lasted more than 15 years.
The Pecora Commission was stacked with big government sympathizers who blamed the free market and the gold standard without question, and without any consideration of government interference in the economy. This panel is no different. Never will they contemplate how government steered us into this crisis, and what perverse incentives can be removed or repealed so that the market will function more smoothly. Never will they discuss how investment should come from savings, not debt. Never will it occur to them that fiat money, artificially low interest rates and the whole Federal Reserve System might be unwise and unstable, not to mention unconstitutional. The answer will always be more government regulation and oversight. It is predictable that this government panel will eventually come to the firm conclusion that government needs to be bigger, and that the market is just too free.
How sad is this when exactly the opposite is true?
It is big government that gives out tax breaks to engineer behavior, often creating large pockets of malinvestments. It is government that created the FDIC and the Fed as lender of last resort which all encourages moral hazard. It is big government that gives bureaucrats the ability to bail out cronies with taxpayer dollars while screaming that the economic sky is falling if they don’t. It is big government that every year adds new layers to the already labyrinthine regulatory code that smaller businesses can’t keep up with while simultaneously preventing new businesses from emerging. It is big government that misdirects economic productivity into bankrupt businesses that they consider to be too big to fail.
If this panel was serious about understanding the root of the problem, as they claim to be, they would have people testify who understand the crisis and saw it coming. To my knowledge, none of them have received a phone call. The problem is those people would say too many things the government panel would find inconvenient. They would point fingers at too many of the state’s anointed. They would recommend getting government out of the way of the free market and getting back to simply protecting contracts and punishing fraud. But the biggest fraud is perpetrated by the Federal Reserve. No one on this panel takes that viewpoint seriously. Instead, they will be asking people who are still scratching their heads at how they could have missed the housing bubble what new regulations they can put in place to prevent future bubbles. Thus, I don’t expect much real wisdom to come out of this current investigation.
Opposition to Keynesian Policies
In January of 2010, Congressman Paul used his "Texas Talk" address to discuss the failures of Keynesian economic policies.
Keynesianism Delivers a Decade of Zero
This past week we celebrated the end of what most people agree was a decade best forgotten. New York Times columnist and leading Keynesian economist Paul Krugman called it the Big Zero in a recent column. He wrote that “there was a whole lot of nothing going on in measures of economic progress or success” which is true. However, Krugman continues to misleadingly blame the free market and supposed lack of regulation for the economic chaos.
It was encouraging that he admitted that blowing economic bubbles is a mistake, especially considering he himself advocated creating a housing bubble as a way to alleviate the hangover from the dotcom bust. But we can no longer afford to give prominent economists like Krugman a pass when they completely ignore the burden of taxation, monetary policy, and excessive regulation.
Afterall, Krugman is still scratching his head as to why “no” economists saw the housing bust coming. How in the world did they miss it? Actually many economists saw it coming a mile away, understood it perfectly, and explained it many times. Policy makers would have been wise to heed the warnings of the Austrian economists, and must start listening to their teachings if they want solid progress in the future. If not, the necessary correction is going to take a very long time.
The Austrian free-market economists use common sense principles. You cannot spend your way out of a recession. You cannot regulate the economy into oblivion and expect it to function. You cannot tax people and businesses to the point of near slavery and expect them to keep producing. You cannot create an abundance of money out of thin air without making all that paper worthless. The government cannot make up for rising unemployment by just hiring all the out of work people to be bureaucrats or send them unemployment checks forever. You cannot live beyond your means indefinitely. The economy must actually produce something others are willing to buy. Government growth is the opposite of all these things.
Bureaucrats are loathe to face these unpleasant, but obvious realities. It is much more appealing to wave their magic wand of regulation and public spending and divert blame elsewhere. It is time to be honest about our problems.
The tragic reality is that this fatally flawed, but widely accepted, economic school of thought called Keynesianism has made our country more socialist than capitalist. While the private sector in the last ten years has experienced a roller coaster of booms and busts and ended up, nominally, about where we started in 2000, government has been steadily growing, because Keynesians told politicians they could get away with a tax, spend and inflate policy. They even encouraged it! But we cannot survive much longer if government is our only growth industry.
As for a lack of regulation, the last decade saw the enactment of the Sarbanes-Oxley Act, the largest piece of financial regulatory legislation in years. This act failed to prevent abuses like those perpetrated by Bernie Madoff, and it is widely acknowledged that the new regulations contributed heavily not only to the lack of real growth, but also to many businesses going overseas.
Americans have been working hard, and Krugman rightly points out that they are getting nowhere. Government is expanding steadily and keeping us at less than zero growth when inflation is factored in. Krugman seems pretty disappointed with zero, but if we continue to listen to Keynesians in the next decade instead of those who tell us the truth, zero will start to look pretty good. The end result of destroying the currency is the wiping out of the middle class. Preventing that from happening should be our top economic priority.
Government and Job Creation
In October of 2010, Congressman Paul used his "Texas Talk" to discuss the role of government in job creation and theory of Keynesian economics.
Government and Job Creation
As the current economic downturn shows no signs of lifting, we hear quite a lot of rhetoric from current and potential office-holders about what government can and will do to create more jobs. This is especially disconcerting to those who understand that the best thing government can do for job creation is to simply get out of the way.
Jobs are properly created by businesses. Government-created jobs are either fueled by fiat money and manipulated market conditions or directly funded by taxes paid by businesses and individuals who then have less to hire people for real wealth creation. Government-created jobs destroy wealth and sap potential from the economy. The several stimulus bills passed by Congress have done much to expand government but not much to keep money in the hands of real job creators – the entrepreneurs.
Keynesian economists don’t see things this way. They see government spending as a stop gap measure that tides us over through rough economic patches. But is this really the case?
Far from it. The reality is instead of sustaining us until the economy can catch up, government spending perpetuates the problems the bureaucrats and the politicians created. Maintaining a high level of employment is one of the main objectives of the Federal Reserve, which is just one reason it is ill-conceived at its very core: it legitimizes economic intervention which is always destructive. When unemployment rises after the bust of a Fed-created bubble, you can be sure Congress will attempt to rescue the economy through various policies that will always prolong the agony and expand the downturn.
In the late 90’s, it was thought that encouraging home ownership would have a stimulative effect that would ripple throughout the rest of the economy and create jobs. Various government policies favorable to home ownership were enacted and the Fed kept interest rates artificially low so everyone would be able to buy a home, whether or not they could really afford it. For awhile, it worked. The housing boom increased demand for realtors, mortgage lenders, and construction workers. However, as reality sank in, not only are we back to where we were when the bubble began, but we are actually worse off. For example, not only have we lost all of the one million extra construction jobs the bubble created, but we lost another one million on top of that! So not only did the artificial wealth evaporate, but real wealth has been destroyed as well.
Even more sinister are jobs created by war. Recent reports highlight the increasing dependence on contractors to support our war efforts in Afghanistan. Massive corruption is endemic to these highly lucrative positions. Almost half of the contracting companies we use are Afghan owned and include such business models as recruiting away the very same Afghan police force we are training at great expense to the American taxpayer. Meanwhile we have pledged not to leave until the police force reaches a certain level. We also bribe many Afghans to simply not attack us. We are in a proverbial hole in Afghanistan. Our leaders need to just stop digging.
Neither a Keynesian big spending program, nor the military-industrial complex can create long-lasting employment or economic prosperity for our country. The only way to restore both peace and prosperity is to draw down our overseas commitments, along with unconstitutional spending at home and return to the founders’ vision of a limited republic that neither straddles the globe, nor micromanages the domestic economy.
Free Markets Create Jobs
In October of 2010, Congressman Paul used his "Texas Talks" to discuss the theory that free markets are what creates jobs. He notes that the poorest countries are the least friendly to free markets.
Free Markets Create Jobs
In this struggling economy it is essential for politicians to take a step back and think about what government has been doing to business in this country. In less than 200 years, the free market, property rights, and respect for the rule of law took this nation from a rough frontier to a global economic superpower. Today, however, our nation and our economy clearly are headed in the wrong direction.
Of course, America has never enjoyed absolute free-market capitalism: creeping government intrusion and special interest political patronage have existed and increased since our founding. But America historically has permitted free markets to operate with less government interference than other nations, while showing greater respect for property rights and the rule of law. Less government, respect for private property, and a relatively stable legal environment allowed America to become the wealthiest nation on earth.
By contrast, the poorest nations almost always demonstrate hostility for free markets, private property, and the rule of law. Capital formation, entrepreneurship, credit, and wealth accumulation are uniformly discouraged in poor countries. Private contracts are not reliably enforced, and private property is not secure in the hands of owners. The predictable result is widespread poverty and misery.
First and foremost, the role of government in business should be limited to resolving contractual disputes. As long as both parties of a contract enter into the arrangement willingly, without coercion, and with complete and accurate information, they should be expected to live up to their end of the deal. When a party cannot or will not honor the terms of a contract, it is acceptable for government to provide a court system to resolve disputes in a fair and impartial way.
Government should not dictate the terms of a contract to the parties involved. However, throughout the 20th century, our government became increasingly comfortable mandating terms that politicians find acceptable without regard to what businesses or their customers might want. This interference has had a chilling effect on the economy.
For example, government increases labor costs through minimum wage laws, union requirements, healthcare mandates, and various other stipulations that decrease a business’s capacity to hire as many employees as they might otherwise. And because they can only hire a few, they must reserve those spots only for top candidates. Thus, a teenager or a handicapped individual may miss out on job opportunities and work experience because of government-created job shortages. What if someone was willing to work for less than the government-mandated minimum wage, and a business was willing to give them a chance? Government makes this illegal, and both the business and the worker are worse off for it.
By contrast, business flourishes when government gets out of the way. One example is playing out in the 14th congressional district in Texas. A major multinational company, Caterpillar, is building an assembly facility in Victoria, Texas, rather than in one of the heavily unionized midwest states where it operates other plants. Texas, as a “right to work” state, offers more manageable labor costs. It also offers a more business-friendly regulatory landscape, and an overall lower tax burden with no corporate income tax. I am pleased that because of this, the people of Victoria will be rewarded with more job opportunities.
Freedom and a restrained government are what made us an economic power house. If we keep chasing businesses away with onerous taxes, mandates, and regulations, they will eventually leave. The best approach to our economic woes that will help the most people is simple: get back to the Constitution and demonstrate respect for free markets, private property, and the rule of law.
On More Stimulus Spending
In September of 2010, Congressman Paul used his "Texas Talk" to note his opposition to the possibility of more stimulus spending.
On More Stimulus Spending
Faced with continuing economic decline and an impending election, the administration, predictably, is entertaining the idea of another stimulus package. To explain why the last one didn’t work, adherents to the Keynesian economic philosophy are claiming that they actually did work - it just looks like they didn’t because we don’t realize how much worse off we would be right now without trillions of dollars of public spending. The last administration bought into Keynesianism just as much as this one does, unfortunately. Until we have leaders who understand that debt is not the way to prosperity, there will be no stopping runaway government spending.
While it is nice to hear about business tax breaks, the positive results of these tax cuts will be dwarfed by its negative effects. First of all, $200 billion or so in temporary tax cuts and credits to businesses are nothing compared to the $3.8 trillion in tax hikes that will hit the economy like a ton of bricks on January 1, 2011 if the Bush tax cuts are not extended by Congress.
Second of all, businesses are reluctant to hire and invest, not because they are looking for temporary credits, but because of future uncertainty; they simply don’t know what the government is going to do next and how future government policies will affect decisions they make now. What new costs and regulations will be placed on them with healthcare reform and financial services reform? Will Congress convene a lame-duck session this winter to pass cap-and-trade and other destructive legislation? What will the cost of compliance be for hiring new employees, and will that force them to simply lay off anyone they hire now? Worse, will the government come up with fines or additional costs if businesses have to lay people off in the future? Right now, the safest thing for businesses to do is nothing. Until we regain respect for the rule of law and remove some of this uncertainty, I’m afraid none of these temporary promises, made right before an election, will do much towards any economic improvement.
The other glaring problem with this proposed stimulus package is that it couples tax cuts with spending increases, which makes no sense when we are already heavily indebted to foreign countries. We should be cutting taxes and slashing government spending dramatically. The private sector simply cannot bear the burden of our engorged public sector. In fact, one reason earlier stimulus programs did not result in any private sector growth is because large amounts went to the public sector. Indeed, the spending that the administration is now proposing arguably constitutes a bailout of the public sector and various union allies of the administration.
This administration is falling into the same dangerous trap we fell into during the Great Depression, as did the Germans leading into their hyperinflation of the 1920’s. The temptation is to do something, anything, proactive to attempt to stimulate the economy, but history has shown us that governments cannot spend their way into prosperity. The best thing government could do is get back to its Constitutional limitations and let the economy stabilize, heal and recover without the crushing burden of government holding it back.
MSNBC Appearance
In March of 2011, Congressman Paul appeared on MSNBC and discussed the overall economy, credit, defense spending, and other items. In this discussion with Cenk Uygar of The Young Turks, Congressman Paul outlines his overall economic theory.
New Hampshire Debate
In June of 2011, Congressman Paul participated in the Presidential debate in New Hampshire. He spoke about his opposition to Keynsian economic policies, and about the need for a strong currency and it's effects on the economy. He was also asked about government involvement in industry and stated that government involvement causes mal-investment.
KING: I appreciate that. Well, welcome. If you're out there and you don't get the distinction coming into the night, Congresswoman Bachmann was exploring. She hadn't taken that last step. The other candidates had taken it. I'm sure they welcome you to the fray.
Let's continue the conversation. I want to come to Congressman Paul. You're all here saying the president of the United States is making the economy worse. Has he done one thing -- has he done one thing right when it comes to the economy in this country?
PAUL: Boy, that's a tough question.
(LAUGHTER)
No, no, I can't think of anything, but may I answer the question that you alluded to before about whether or not 5 percent is too optimistic? No, there's nothing wrong without -- without setting a goal of 5 percent or 10 percent or 15 percent, if you have a free- market economy.
We're trying to unwind a Keynesian bubble that's been going on for 70 years, and you're not going to touch this problem until you liquidate the bad debt and the mal-investment, go back to work. But you have to have sound money, and you have to recognize how we got in the trouble.
We got in the trouble because we had a financial bubble, and it's caused by the Federal Reserve. If you don't look at monetary policy, we will continue the trend of the last decade. We haven't even -- we haven't developed any new jobs in the last decade. Matter of fact, we've had 30 million new people and no new jobs, and it's because they don't -- the people don't understand monetary policy and central economic planning things.
Free markets will give you 10 percent or 15 percent growth or whatever (ph) and you will not have to turn it off because you think it's going to cause inflation. It doesn't work that way.
...
MIKE PATINSKY, DIRECTOR OF TRANSPORTATION, FRANKLIN PIERCE COLLEGE: Well, for the candidates I'd like to know how they plan on returning manufacturing jobs to the United States.
KING: Congressman Paul, why don't you start with that one?
PAUL: Pretty important because everything we've done in the last 20 or 30 years we've exported our jobs. And when you have a reserve currency of the world and you abuse it, you export money. That becomes the main export so it goes with the money.
You have to invite capital. The way you get capital into a country, you have to have a strong currency, not a weak currency. Today it's a deliberate job of the Federal Reserve to weaken the currency. We should invite capital back.
First thing is, we have trillions of dollars, at least over a trillion dollars of U.S. money made overseas, but it stays over there because if you bring it home, they get taxed. If you want to, we need to get the Fed to quit printing the money and if you want capital, you have to entice those individuals to repatriate their money and take the taxes office, set up a financial system, deregulate and de-tax to invite people to go back to work again.
But as long as we run a program of deliberately weakening our currency, our jobs will go overseas, and that is what's happened for a good many years, especially in the last decade. KING: Governor Pawlenty, does the congressman have it right?
...
JOHN DISTASO, NEW HAMPSHIRE UNION LEADER SR. POLITICAL REPORTER: Thank you, John.
To federal -- Congressman Paul, this is for you. The federal government now assists many industries, green jobs, the auto industry, research and development, all get subsidies. Given the current state of the economy, what standards do you have, if any, for government assistance to private enterprise?
PAUL: There shouldn't be any government assistance to private enterprise. It's not morally correct, it's legal, it's bad economics. It's not part of the constitution. If you allow an economy to thrive, they'll decide how R&D works or where they invest their monies.
But when the politicians get in and direct things, you get the malinvestment. They do the dumb things. They might build too many houses. And they might not direct their research to the right places. So no, it's a fallacy to think that government and politicians and bureaucrats are smart enough to manage the economy, so it shouldn't happen.
Questioning the Success of Economic Policies
In September of 2011, Congressman Paul used his "Texas Talk" to call into question the economic policies of the Obama administration.
Successful Economic Policies? For Whom?
Last week, in the wake of another uptick in the official unemployment rate, the administration continued to claim that their economic policies were working, just not fast enough. This administration inherited an unemployment rate of 7.7% and promised a peak of no higher than 8% if their policies were followed. Not only does the administration have a funny way of ending a war, but now they claim their economic policies are successful. For whom, I wonder?
These policies are not working for the 9.6% of Americans who are out of work, nor for the over16% underemployed. They are not working for nearly 3 million Americans who have declared bankruptcy in the last two years, or the 40 million currently on food stamps. Nearly 1 in 6 Americans depend on those and other government anti-poverty programs such as Medicaid and unemployment benefits. As more Americans are added to the unemployment rolls, the tax base from which to hand out their benefits is shrinking. Still, businesses are being taxed and regulated out of the market, adding to the problem. What solutions are put forth? More government spending - even as each citizen’s portion of the public debt is over $43,000 and expected to increase by $250,000 over the next 40 years.
No, this economy is not working for these people. But current economic policy does “work” for some people. For example, it has worked out very well for certain bankers and large corporations, who took on too much risk and got themselves in hot water, and were declared “too big to fail” which is really a euphemism for “friends in high places”. It works well for large, well-connected military industrial corporations, who can always count on perpetual war and conflict to keep them in business. It also works for those on the government’s payroll, which is increasing as the tax base is decreasing.
So where does the government get all this money even as its most obvious stream of revenue dries up? How can it keep spending seemingly indefinitely? Once it steals as much from you as it can get away with through taxation, it steals even more from you through what central bankers like to call quantitative easing, which is more or less the same thing as counterfeiting. When the money is no longer based on a finite quantity of something of value, like a store of gold or silver, the amount of money in circulation is not limited by anything but the restraint of those in control of the printing presses, in our case the Fed and the US Treasury. When increasing pressure is put upon them by irresponsible politicians, it is predictable that out of thin air, more money will be created to satisfy the insatiable appetites of those on political spending sprees. As money becomes more plentiful, it becomes less valuable, and the average citizen suffers again as the value of their savings evaporates. It has happened over and over in history, and what usually follows is the total debasement of the currency, hyperinflation and chaos.
Sound economic policy would be to take our foot off the gas and apply the brakes to government spending as the economic cliff approaches. We must get back to where our economy produces actual wealth, rather than mere paper wealth. The road back to fiscal sanity and a strong economy is simple: Congress just needs to get back to following the Constitution.
TEA Party Debate
In September of 2011, Congressman Paul participated in the TEA party debate in Tampa Bay, Florida. He responded to statements made by Governor Perry and stated that one area that could be cut was the embassy in Afghanistan that cost $1 billion.
Fox News / Google Debate
On September of 2011, Congressman Paul participated in the Fox News / Google debate. He notes his overall economic theory in relation to the federal reserve and the cycles of booms and busts.
BAIER: Congressman Paul?
PAUL: Government destroys jobs; the market creates jobs. So the government isn't going to be expected to create the jobs; they have to change the environment. But you can't do that unless you understand where the depression, recessions come from, and you can't understand that unless you know where the bubbles come from.
I've been arguing this case for 20 years and warning about bubbles and housing bubbles and Nasdaq bubbles. And a lot of other economists have been doing the same thing.
Until we understand that, you can't solve the problem. You have to deal with the Federal Reserve system. You have to deal with free markets. And you have to deal with the tax program and the regulatory system.
(APPLAUSE)
Then you can get your jobs, because the people will create the jobs, not the government.
Dartmouth Economic Debate
On October 11, 2011 Congressman Paul participated in a debate at Dartmouth college. He discusses the causes of bubbles in general and the housing bubble in particular. He also discusses his opposition to Keynesian economics and his support for Austrian economics.
ROSE: Let me go to housing, what you’d do. Would you get the federal government out of housing? Yes?
PAUL: Absolutely. I mean, there’s no need to. Look at...
ROSE: No Freddie - no Freddie Mac, no Fannie Mae, nothing?
PAUL: The - no. You - that’s where the distortions come. That’s where the moral hazard comes from. That’s where the malinvestment, overbuild.
It was predictable. You talked about what economists we should look to. And, unfortunately, we’ve been living with Keynesian economics for many, many decades. And everybody who was right about predicting the bubbles were Austrian economists. They said they were coming. And yet they’re also saying - and I agree with them - that everything that we’re doing right now is wrong.
So what we did with the housing bubble, yes, we had too many houses. It was glaring in our face. The bubble was doomed to burst, and it came because of Fannie Mae, Freddie Mac, easy credit, and also Community Reinvestment Act.
So who - who got into trouble? The people who did the speculating, the Wall Street, the derivatives market? They got the bailout. They got (inaudible) so what happened to the middle class? They lost their jobs. They lost their houses.
This whole system is all messed up. And you’re - what I hear here is just tinkering with the current system and not looking at something new and different, and it’s a free-market economy without a Federal Reserve system, with sound money. If you don’t have that, you’re going to continue with the bubble.
And this propping up this debt and keeping the correction, you need the correction. You need to get rid of the malinvestment and the debt.
ROSE: All right. Time.
PAUL: The debt is the burden on the economy.
Restore America's Prosperity
Congressman Paul's economic plan for the 2012 election consists
THE TIME FOR ACTION IS NOW
The severe economic crisis America has experienced over the past several years, including growing inflation, rising gas prices, trillion-dollar budget deficits, immoral bailouts, and the ever-declining value of the dollar, is just the tip of the iceberg if our nation does not immediately change course.
UNHEEDED WARNINGS
As the crash approached, Ron Paul was heavily criticized by the establishment media and even many of his fellow Republicans because he would not back down from his warnings about where big government policies were leading America.
When those warnings came true, however, our President and leaders in Congress didn’t let the crisis “go to waste” and used it as an excuse to expand government intervention and power on an unprecedented level.
Excessive spending, artificial credit, and market manipulation crashed our economy, and no one should be surprised that these same policies continue to prolong the suffering for millions of Americans.
We need a President who is not afraid to make the tough decisions necessary to restore America’s economy and guarantee future prosperity.
REAL SOLUTIONS
As President, Ron Paul will lead the way out of this crisis by:
Vetoing any unbalanced budget Congress sends to his desk.
Refusing to further raise the debt ceiling so politicians can no longer spend recklessly.
Fighting to fully audit (and then end) the Federal Reserve System, which has enabled the over 95% reduction of what our dollar can buy and continues to create money out of thin air to finance future debt.
Legalizing sound money, so the government is forced to get serious about the dollar’s value.
Ending the corporate stranglehold on the White House.
Driving down gas prices by allowing offshore drilling, abolishing highway motor fuel taxes, increasing the mileage reimbursement rates, and offering tax credits to individuals and businesses for the use and production of natural gas vehicles.
Eliminating the income, capital gains, and death taxes to ensure you keep more of your hard-earned money and are able to pass on your legacy to your family without government interference.
Opposing all unfunded mandates and unnecessary regulations on small businesses and entrepreneurs.
These are just a few of the steps we can take to put America back in place as the world’s leading economy. Taking a stand for these principles has often been a lonely fight in Congress for Ron Paul, but, now more than ever, our nation needs a President who will champion sound money, responsible spending, lower taxes, and free market enterprise.
Restore America Plan
SYNOPSIS:
America is the greatest nation in human history. Our respect for individual liberty, free markets, and limited constitutional government produced the strongest, most prosperous country in the world. But, we have drifted far from our founding principles, and America is in crisis. Ron Paul’s “Restore America” plan slams on the brakes and puts America on a return to constitutional government. It is bold but achievable. Through the bully pulpit of the presidency, the power of the Veto, and, most importantly, the united voice of freedom-loving Americans, we can implement fundamental reforms.
DELIVERS A TRUE BALANCED BUDGET IN YEAR THREE OF DR. PAUL’S PRESIDENCY:
Ron Paul is the ONLY candidate who doesn’t just talk about balancing the budget, but who has a full plan to get it done.
SPENDING:
Cuts $1 trillion in spending during the first year of Ron Paul’s presidency, eliminating five cabinet departments (Energy, HUD, Commerce, Interior, and Education), abolishing the Transportation Security Administration and returning responsibility for security to private property owners, abolishing corporate subsidies, stopping foreign aid, ending foreign wars, and returning most other spending to 2006 levels.
ENTITLEMENTS:
Honors our promise to our seniors and veterans, while allowing young workers to opt out. Block grants Medicaid and other welfare programs to allow States the flexibility and ingenuity they need to solve their own unique problems without harming those currently relying on the programs.
CUTTING GOVERNMENT WASTE:
Makes a 10% reduction in the federal workforce, slashes Congressional pay and perks, and curbs excessive federal travel. To stand with the American People, President Paul will take a salary of $39,336, approximately equal to the median personal income of the American worker.
TAXES:
Lowers the corporate tax rate to 15%, making America competitive in the global market. Allows American companies to repatriate capital without additional taxation, spurring trillions in new investment. Extends all Bush tax cuts. Abolishes the Death Tax. Ends taxes on personal savings, allowing families to build a nest egg.
REGULATION:
Repeals ObamaCare, Dodd-Frank, and Sarbanes-Oxley. Mandates REINS-style requirements for thorough congressional review and authorization before implementing any new regulations issued by bureaucrats. President Paul will also cancel all onerous regulations previously issued by Executive Order.
MONETARY POLICY:
Conducts a full audit of the Federal Reserve and implements competing currency legislation to strengthen the dollar and stabilize inflation.
CONCLUSION:
Dr. Paul is the only candidate with a plan to cut spending and truly balance the budget. This is the only plan that will deliver what America needs in these difficult times: Major regulatory relief, large spending cuts, sound monetary policy, and a balanced budget.
Voting Record
Small Business Jobs Tax Relief Act of 2010
In June of 2010 the House voted to pass the Small Business Jobs Tax Relief Act of 2010. The act passed 247-170. Ron Paul voted in favor of the Small Business Jobs Tax Relief Act of 2010
Ron Paul voted in favor of the Small Business Jobs Tax Relief Act of 2010
Wall Street Reform and Consumer Protection Act of 2009
In June of 2010, the House voted on the Wall Street Reform and Consumer Protection Act of 2009. The act failed to pass in a . Ron Paul voted in favor of the Wall Street Reform and Consumer Protection Act of 2009.
Ron Paul voted in favor of the Wall Street Reform and Consumer Protection Act of 2009.
TARP Bonuses
In March of 2010, the House voted on legislation to impose an additional tax on bonuses received from certain TARP recipients, and for other purposes. The legislation passed the House 276-145. Ron Paul voted against the legislation to tax bonuses to TARP recepients.
Ron Paul voted against the legislation to tax bonuses to TARP recepients.
Small Business and Infrastructure Jobs Tax Act of 2010
In March of 2010 the House voted to pass the Small Business and Infrastructure Jobs Tax Act of 2010 246-178. Ron Paul voted against passing the Small Business and Infrastructure Jobs Tax Act of 2010.
Ron Paul voted against passing the Small Business and Infrastructure Jobs Tax Act of 2010.
Wall Street Reform
In late 2009, the House passed the Wall Street Reform and Consumer Protection Act of 2009. The legislation consolidated many financial regulatory agencies, increased transparency in the derivatives market, regulation of credit rating agencies, and a "resolution regime" to resolve insolvent banks. Ron Paul voted against the Wall Street Reform Legislation.
Ron Paul voted against the Wall Street Reform Legislation.
The Stimulus
After the Senate passed the Stimulus package, the House voted on a passage of a conference bill to join the House and Senate versions. Ron Paul voted against the unified version of the Stimulus bill.
Ron Paul voted against the unified version of the Stimulus bill.
The Stimulus
The Stimulus bill (The American Recovery and Reinvestment Act of 2009) passed through the House on January 28, just days after President Obama\'s inauguration. The bill got no support from Republicans and 11 Democrats voted against it as well. Ron Paul voted against the Stimulus when it passed the House.
Ron Paul voted against the Stimulus when it passed the House.
Helping Families Save Their Homes Act of 2009
The Helping Families Save Their Homes Act of 2009 was a program designed to assist those who may be able to remain in their home with a modest amount of government assistance. The bill got wide bi-partisan support in the House and passed 367-54. Ron Paul voted against the Helping Families Save Their Homes Act of 2009.
Ron Paul voted against the Helping Families Save Their Homes Act of 2009.
Auto Industry Financing and Restructuring Act
In December of 2008 the US House voted to pass the Auto Industry Financing and Restructuring Act. The act provided a loan to GM through TARP funds and set up a plan to allow the company to receive more if they demonstrated a path back to viability. The act failed to pass the Senate, but was used as a guideline for the GM bailout for the Obama administration. Ron Paul voted against the Auto Industry Financing and Restructuring Act.
Ron Paul voted against the Auto Industry Financing and Restructuring Act.
Troubled Asset Relief Program (TARP)
The TARP program was designed to prevent the failure of large banks by purchasing their "troubled assets" and allowing them to move them off their records as liabilities. The vote on the legislation passed 263-171 Ron Paul voted against the TARP Program.
Ron Paul voted against the TARP Program.
The Bush Stimulus
In early 2008, the Recovery Rebates and Economic Stimulus for the American People Act of 2008 was passed in an attempt to stimulate the economy. Also known as the Bush Stimulus, the act consisted largely of checks sent to individuals. The bill received wide bipartisan support and passed the House 385-35. Ron Paul voted against the Bush Stimulus.
Ron Paul voted against the Bush Stimulus.
Bankruptcy Reform
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 completely redefined bankruptcy in the United States. The bill made it much more for people to walk away from unsecured debt, such as credit cards, and permitted the court to award some compensation to creditors in the event that a bankruptcy was awarded. The bill got moderate bipartisan support and passed 302-126. Ron Paul voted in favor of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.
Ron Paul voted in favor of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.
Sarbanes-Oxley
In response to Enron and other accounting scandals, Congress passed a bill which imposed a number of book-keeping and accounting regulations on several industries. The Sarbanes-Oxley Act of 2002 The bill received moderate bi-partisan support in the House and passed in a 334-90 vote. Ron Paul voted against Sarbanes-Oxley.
Ron Paul voted against Sarbanes-Oxley.
Financial Services Modernization Act of 1999
Also known as GRAMM-LEACH-BLILEY ACT, this legislation ended the Glass-Stegall rule that separated banking institutions from investment institutions. Ron Paul cast a "No Vote"
Amends the Internal Revenue Code to repeal a provision (added by the Patient Protection and Affordable Care Act) that extends to corporations that are not tax-exempt the requirement to report payments of $600 or more.
Requires the receipts and disbursements of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) to be counted as new budget authority, outlays, receipts, or deficit or surplus for purposes of: (1) the federal budget submitted by the President; (2) the congressional budget; or (3) the Balanced Budget and Emergency Deficit Control Act of 1985 (Gramm-Rudman-Hollings Act). Requires the costs of purchases of mortgages, and mortgage-backed securities issued, by Fannie Mae and Freddie Mac to be calculated by adjusting a specified discount rate for market risks under the Credit Reform Act of 1990. Subjects to the statutory public debt limit the face amount of obligations issued by Fannie Mae and Freddie Mac and outstanding at one time.
