Ron Paul discusses HR 1207, the bill to audit the Federal Reserve

This Wednesday afternoon, Ron Paul joined G. Edward Griffin, Lew Rockwell, Peter Schiff, Adam Kokesh and Shelly Roche to discuss congressional efforts to audit the Federal Reserve, as well as other political and economic developments.

Part 1: (Ron Paul)
Part 2: (Ron Paul)
Part 3:
Part 4:
Part 5:
Part 6:

Audio only:Download the show as an MP3 file here.

Channel: Fox News Strategy Room
Show: Freedom Watch
Host: Judge Andrew Napolitano
Date: 7/15/2009

Transcript of Ron Paul’s appearance

Judge Andrew Napolitano: Are you ready for this? The Federal Reserve is now threatening the American people with higher interest rates if Congress continues to attempt to expose its private, super-secret, and unregulated methods.

You know what the Federal Reserve is. It’s a semi-private bank. Its Board of Governors is appointed by the President, but it is privately owned. The amount of its wealth, the loans that it makes, the foreign governments it has shorn up and the debts that it has incurred have all been kept from you.

Why should you know what the Fed has done and what the Fed is doing? That is easy. It prints your money. It controls your interest rates. It is the lender of last resort to your government.

Late last week, a guy you’ve probably never heard of, Donald Kohn, the vice-president of the Fed’s Board went before Congress and said:

Donald Kohn: “The bond-rating agencies view operational independence of a country’s Central Bank as an important factor in determining sovereign credit interest rates.”

Translation: He is suggesting that any threats to the Fed’s privacy and independence could lower the Treasury’s debt rating and thus raise its cost of borrowing. In other words, Congressman Ron Paul’s House bill, HR 1207, the bill that would audit the Fed, the bill that has over 250 co-sponsors in the House is a direct threat to the independence and the privacy of the Fed.

The Federal Reserve so fears that an audit will undermine its secretive ways, expose its numerous misdeeds and its mega-grand theft scams that it will hold you responsible for this. This is plain and simply extortion. The Fed is basically saying, “Audit us and we will raise your interest rates.”

No one, no one in the government should ever be able to threaten to perform such an act; the threat to perform a lawful act for an unlawful purpose. That is extortion, and that’s what the Federal Reserve is threatening to do if Congressman Paul’s bill in the House of Representatives passes. This is similar to the threats that the Fed made to banks that initially rejected TARP funds: “Take our TARP funds or we’ll audit you.”

HR 1207 in the House and S 806 [S 604] in the Senate are the only practical hope for any form of transparency and the only means by which Donald Kohn and Ben Bernanke and the rest of the bankers that hold us hostage can be held accountable.

It’s my pleasure to introduce my good friend and one of the great defenders of freedom and liberty in Congress, in the United States and on the planet today, Congressman Ron Paul joins us from our nation’s capital. Congressman, we couldn’t start the show without you. Welcome back to Freedom Watch.

Ron Paul: Thank you. It’s good to be with you again.

Judge Andrew Napolitano: […] It has actually come to pass with threatening the American people with higher interest rates if we dare try to audit them.

Ron Paul: Judge, about two-thirds of your question, I think, was canceled out, but I heard your opening statement and that is essentially what it is. It is extortion and threats to scare the people, but that’s the way government generally works, whether it’s an economic calamity or an international calamity, it always to scare the people, intimidate them and make sure that the people know that if they don’t do the bidding of the powerful elite, then worse conditions can exist.

But how can truth ever be harmful? You know, truth shouldn’t be harmful. Hiding the truth doesn’t really change the truth and this idea that if we don’t know what the Fed has been doing, it’s going to make us feel better… You know, for instance, I think one thing an audit might reveal will be all the communications between the Fed and Goldman Sachs. Just think of what kind of communications we might find there and what kind of promises were made and how Goldman Sachs came out so golden, but that should be available to us. If there’s a lot of power in the hands of the Federal Reserve officials, we have to know how they’re using that power and what kind of promises do they make overseas.

I came across the statement the other day where the Fed officials during the Pan-American credit crisis a decade or so ago had the IMF pay the interest to the New York banks and the Federal Reserve did it. You know, they’re the ones who went to the IMF. So those are the kinds of things that go on and the American people deserve to know about this because if they destroy the money as they destroyed the financial system, we need to know who is at fault and what we ought to do to correct it.

Judge Andrew Napolitano: By saying, “If you pass Ron Paul’s bill on the House and Jim DeMint’s bill in the Senate, we’re going to raise interest rates on everybody”, doesn’t it sort of cause Congress to dig in its heels? I mean, can any entity really successfully threaten the Congress, “If you do this, we’ll do that back to you?”

Ron Paul: Well, too often the Congress has become intimidated. The President is a very, very powerful person and he represents the special interests. You know, Obama, his biggest donor was Goldman Sachs. So yes, there are a lot of power they can wield. It shouldn’t be that way. The Congress and the Congress members ought to be defending the people, but therefore the pressure has to come from the people. That’s why we have a lot of co-sponsors. It’s not so much that all of a sudden I got more persuasive or the issue became more important. The American people woke up and said, “Look, we want more transparency. We want to know what’s going on in the Federal Reserve.”

Judge Andrew Napolitano: I think you’re being modest, but I’m thrilled that you have so many co-sponsors. What’s the status in the House? What would be the next step to translate the fact that you have more than half of the co-sponsors into a movement of the bill through the process that it has to go through in the House before it can get to a vote by members of the House?

Ron Paul: Well, it all depends on those in power on what they want to do. For instance, if Obama wanted it and Pelosi wanted it, they could bring it up on the floor tomorrow under suspension and it would pass and that would be it, then the burden would be on the Senate. But they don’t want it, you recall what they did with DeMint’s bill, they ruled it out of order.

So the most, I think, we can expect right now is to get a portion or the major part of this put on a bill that Barney Frank is working on, you know, re-doing all the regulations, but that doesn’t assure us much. I’m afraid and I’m preparing and conditioning myself and everybody else that when push comes to shove, they’re going to give us a token effort to support this, but in reality, we won’t know one year from now what’s going on behind the scenes and that to me is discouraging, but I still work with the assumption that we can and should get it passed in the House. We have to keep putting pressure on the Senate. We have to try to make this system work because it’s a calamity if it fails, so therefore we have to continue the process.

But for me, to say, “Well, we have the large majority and pretty soon, we’re going to have two-thirds of the Congress at the rate we’re going”, and if we can’t get this passed, we have to, you know, put more pressure somehow or other to let the people know what’s going on.

Judge Andrew Napolitano: And shows like this one and the others on which you appear will continue to educate the public about what needs to be done. This morning on my radio show, I was ranting and raving, Congressman Paul, about what happened in the House yesterday. Did the leadership yet again spring another thousand-plus page bill on members of the House and did they yet again without reading it, vote for it and does it yet again do the unthinkable, which is to raise taxes on employers in a time of recession?

Ron Paul: This is business as usual and they don’t want those kind of bills to see the light of day, so they come up quickly. They don’t get truly exposed and truly debated, so hopefully, you know, we’ll have more exposure for this medical bill that’s coming through.

But then again, some of the issues that do see the light of day and a lot of debate, what will happen the night before they’re brought to the floor, when they go to the Rules Committee, they’ll have a managers amendment, which can rewrite the whole bill. That essentially what happened on the PATRIOT Act then, there was debating. It had been in committee, but it was rewritten the night before it came to the floor.

So this is… I mean, I know why you’re shocked and I know why everybody should be shocked, but we shouldn’t all be that surprised. Of course, I’m not because I’ve seen it happen for so many years and have been fighting it. It’s just sort of exasperating that we can’t expose this to the public and then the American people would say, “No more of this.” And if they knew exactly what’s going on around here, I think a lot of incumbents would lose their seats.

Judge Andrew Napolitano: Exasperating and I was ranting and raving about it this morning. I know it happens all the time and I don’t want to get too deep into philosophy, but the concept of, you know, if you ran a business, if anybody rans a business and an employee of the business committed the business to some fantastic expenditure on the basis of a thousand-page document and the employee didn’t read the document and the employee wouldn’t let employer see the document, well, the employer should fire the employee.

That is almost literally what happened in the House of Representatives yesterday. You guys work for us. You didn’t have a chance to read it. The American public couldn’t see it. I don’t even know if the ink was dry by the time they took a vote and yet the House passes it.

Never mind that it does the unthinkable, which is to raise taxes in a recession, but the manner in which it happened is so antithetical to the government that Jefferson and Madison thought they were giving us. It’s just mindboggling that this can happen over and over again and the same people who do it keep getting returned to Congress.

Ron Paul: Right. Nobody ever gets fired no matter how bad the problems get. Nobody seems to be responsible nor do they get fired. Now, the one way I’ve been able to generally stay out of trouble on voting for these bills is I have a very strict rule. You know, if a bill comes to the floor and I haven’t had adequate time to look at it, it looks terrible, I mean, it is just an automatic no. They cannot make me vote for something like that. Most of the time, you can get a hint. Obviously, the bill, you know, even with a few minutes, you can figure out this is just bad news, but to really study it, no, it’s generally not available to us.

Judge Andrew Napolitano: Just switching gears before I let you go. Is there any buzz on Judge Sotomayor? I mean, did she adequately stick to the party line sufficient to get the number of votes that she needs in the Senate to get confirmed? Should any of us be surprised that a liberal Democrat in the White House would produce a liberal Democrat on the Supreme Court?

Ron Paul: No, I don’t think anybody should be surprised. It looks like she’ll go through rather easily. The only thing we can do and I don’t know whether there is much hope for this is that sometimes liberal appointments by Democrats turn out to be a little bit better than we expect and sometimes, conservative appointments by Republicans turn out to be a lot worse that we expected, so let’s hope for the best. But I think she’ll be a member of the Court.

Judge Andrew Napolitano: Congressman Ron Paul, thanks very much. Thanks for opening the show with us yet again.

Judge Andrew Napolitano: We’ll see you next Wednesday.

Ron Paul: Thank you.

Judge Andrew Napolitano: Thank you.

  • Helen

    There is absolutely NO reason to hide anything from the people nor the government. Federal Reserve is a fraud. Audit the Fed.


  • Non-Federal Non-Reserve

    “In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.” — Alan Greenspan

  • Geithner is paying them to hide the bill….

    They’re hiding it

  • James

    “This morning on my radio show, I was ranting and raving, Congressman Paul, about what happened in the House yesterday. Did the leadership yet again spring another thousand-plus page bill on members of the House and did they yet again without reading it, vote for it and does it yet again do the unthinkable, which is to raise taxes on employers in a time of recession?”

    I have attempted to find this Resolution, however, I wasn’t able to find it. Can anyone find the bill?

  • longshotlouie

    Niiiiice, you woke up early today!

    The fed uses threats. That’s not a question.
    The rate does need to go up, naturally.
    Despite your tantrum, inflation will be unavoidable.

    I love it when you use that conspiracy word.
    One problem, this is not a secret.

    Good to see you so motivated in your crusade to save us.

    • Matt

      “The fed uses threats. That’s not a question.
      The rate does need to go up, naturally.”

      If Kohn is speculating treasury borrowing rates might increase due to rating agency perception should monetary policy become politicized, and ‘naturally’ ‘the rate does need to go up’ you say, why would Napolitano say this is a threat?

      I just want to understand, I thank you in advance for your guidance.



      • Bottomline
        • Non-Federal Non-Reserve

          It’s not federal and there’s no reserve. It’s a private counterfeiting monopoly.

          • Matt

            Nice. Your Parrots are very insightful. I appreciate you giving them some time to respond.

  • Matt

    “The Federal Reserve is now threatening the American people with higher interest rates if Congress continues to attempt to expose its private, super-secret, and unregulated methods.”

    Where did this guy get a ‘higher interest rate threat’ from? See the last statement from the FOMC:

    “The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.”

    “Extended period”…

    Besides that inaccuracy, RP supporters chide the Fed for leaving rates at 1% a few years ago, NOW THAT RATES ARE AT ZERO, INCREASING THEM CONSTITUTES A ‘THREAT’? aahahhaha, sooo umm, what are they supposed to do, LOWER RATES BELOW ZERO?!? LEAVE RATES AT ZERO?

    So despite the fact he is making sh up and NO THREAT HAS BEEN MADE, RP/Schiff supporters worry about ‘Weimar-like inflation’ and this genius is worried about the Fed increasing rates?

    Gawd, apparently he doesn’t worry about insulting his audience’s intelligence or worry about being a hyprocrite, it does take a backseat to conspiracies and the requirement of feeling persecuted I guess…

    • Helen

      You sir are a complete retard.

      So ignorant. So pathetic.

      If you’re so smart, why aren’t you in congress?

      STFU and GTFO the site.

      • Matt

        If you are so angry, why aren’t you in jail?

        Whatever your answer is, I will let that be mine as well. Peace.

    • Helen

      It’s not even the issue of interest rates, its an issue of the corrupted system and the behind the scenes fraud that takes place. It doesn’t take a lot to come to this blog and flame at the congressman Ron Paul and his ‘inaccuracies’. However, you should know that you’re just an ignorant fool who has no interest in benefiting the people. Instead, just a nerd sitting behind his computer screen criticizing Congressman Ron Paul, thinking you’re proving some kind of point. Congressman Ron Paul is doing an excellent job, he’s a smart and a wise person, and YOU coming here and posting this SH on his blog (which is completely irrelevant to the big idea of this whole thing) doesn’t make you look like a hero. Go criticize someone else, no one gives a SH about your opinion.

      • Matt

        But if it is not “even the issue of interest rates” then why is the basis of the rant “The Federal Reserve is now threatening the American people with higher interest rates”? The Fed is not, how foolish it sounds is my point!

        “An association of men who will not quarrel with one another is a thing which has never yet existed, from the greatest confederacy of nations down to a town meeting or a vestry.”
        – Thomas Jefferson

        Maybe you should just sit around in a little bubble and agree with each other, that is how you become galvanized for an intellectual revolution… Yeah, right.

        • Helen

          Nevertheless, it’s clear that the Federal Reserve is a corrupted system, and you have got to be a fool to say “leave it as be”.

          “Maybe you should just sit around in a little bubble and agree with each other…”

          Isn’t that exactly what everyone has been doing regarding the Federal Reserve since 1913?