Show: Morning Meeting
Dylan Ratigan: Live pictures of testimony. Ben Bernanke currently testifying the second day on the hill, talking about too big to fail, arguing that the Federal Reserve should be in charge of monitoring too big to fail as opposed to actually creating institutions that are not too big to fail.
The Federal Reserve, of course, having proven itself unreliable at best in monitoring the financial markets over the past couple of years as a result of the largest insurance company, the largest bank, multiple investment banks, students couldn’t get student’s loans, retirees wiped out, et cetera, et cetera and the Federal Reserve still doesn’t think that they deserve to be audited, even as they carry trillions of dollars of assets on their books held against US taxpayer money, but still, no audit, Ben Bernanke says.
With us live, a man who actually thinks an audit might be in order, peculiar though that may be. I’m referring to Congressman Ron Paul, Republican and frequent Fed critic. Congressman Paul, first of all, I want to thank you so much for you taking a moment to talk with us in the course of your work day. I know the time of day is tricky. What is the resistance? Where is the resistance? Why is there resistance to your efforts to audit the Federal Reserve when reasons to do so would seem phenomenally obvious?
Ron Paul: Well, I think the resistance comes from whose interests are being challenged, so those who are involved in the Federal Reserve System, they don’t want to be challenged.
Dylan Ratigan: So who is that? Is that Goldman Sachs? Is that the previous chairman?
Ron Paul: Well…
Dylan Ratigan: Who is that?
Ron Paul: The immediate Federal Reserve Board, as well as all the banks that belong, especially the big banks and that would include people like Goldman Sachs and all the big banks because the Federal Reserve works in collusion with big banks because money is created not only by the Federal Reserve, but it’s created by fractional reserve banking.
Dylan Ratigan: Sure.
Ron Paul: And for that reason, you know, it’s an empire that they have. But those people who benefit by the system and there are a lot of benefits, deficit financing by Congress benefits.
Dylan Ratigan: Sure.
Ron Paul: And yet they’re getting to a point now where they do need to look in because they’re starting to realize that the Federal Reserve is a government unto itself. Just think, you’ve mentioned already that there are trillions of dollars involved and that they’re not appropriated, so it’s an entirely unconstitutional process of bailing out people off budget.
Dylan Ratigan: It’s not a democracy.
Ron Paul: For me, it’s an outrage.
Dylan Ratigan: Okay, it makes me laugh because when you really put all the pieces together, it makes you think about moving to Russia sometimes. Anyway, if you look … we had a conversation with Ron Wyden about healthcare and the resistance from health insurance to a more competitive environment for healthcare such that their ability to exploit the system to make lots of money is diminished.
Right now, we’re dealing with a situation where the banking infrastructure and the politicians who were bought and paid for by the banking infrastructure is trying to protect the secrecy of the Federal Reserve because the Federal Reserve right now is hiding the secrets of the American banking system. Is that a fair… is that fair?
Ron Paul: It’s absolutely correct and they say they don’t want anybody looking at anything they do under the FOMC and that would…
Dylan Ratigan: So here’s the question. So here’s the question because I think the American people are with you on this one. I think that it’s obvious that the Federal Reserve has failed the American people.
Ron Paul: Right.
Dylan Ratigan: I think the American people understand what a trillion dollar is and what, let alone, ten trillion dollar is. They also understand what it means to risk. If I take your money to Vegas and blow it all and then pay myself the winnings and stick you with the losses, which is what the banks did to the American people, what can the American people do for you to help you get an audit of the Federal Reserve for all of us.
Ron Paul: Well, continue to do what they’ve been doing. I mean, we have 275 co-sponsors in the House and I didn’t do that by myself. The American people have awoken and they have called their congressmen and now, they’re calling their senators. We’re up to 19 senators and we have to continue to do this and something will have to be done. They’re going to fight us tooth and nails and if you notice yesterday, they came out pretty hard against me in the Wall Street Journal because they don’t want to have any part of this audit, so they’re trying to discredit us and their argument now is that if they have transparency, it would cause the interest rates to go up and that’s the reason, “don’t do that because we want the right to lower interest rates or raise interest rates without any political influence,” as if presidents don’t have political influence, as if these companies that benefit as if they are not considered a political influence on the Fed.
Dylan Ratigan: Right. Well, the thing that I like about Barack Obama as a president and I can just say many things to be criticized about him as a president, but the thing that I like about him is his rhetoric that says, “I want to open the cans of worms. I want to open the can of worms that is healthcare and the health insurance cabal. I want to open the can of worms that is finance regulation and the finance cabal.” But then when I see the actions of either Democratic Party in Congress or the actions of the president himself, they tend to be much weaker than the president’s rhetoric.
The finance regulation to me was a joke. They did not address too big to fail. They didn’t address the cops working for the crooks. You can’t even get an audit of the Federal Reserve who currently warehouses all of the shenanigans of the American banking system in secret on its balance sheet. What can the president do to turn some of his rhetoric into more action on either side of the aisle to help the American people, which was the argument that he made in running for office?
Ron Paul: Well, I think he has to do but one thing, keep his promises, whether it has to do with civil liberties or foreign policy, or the financial institutions and he should just do what he says. He wanted transparency. He wanted to cut back. He wanted to bring the troops home. He wanted to protect civil liberties. He wanted to punish those who tortured, and on and on, but nothing seems to happen. That’s why his numbers are going down because the American people were very, very hopeful that we have a new President, a young guy making these promises.
Dylan Ratigan: Right, yeah. I know.
Ron Paul: Now, they’re saying, “it looks like it’s more of the same.”
Dylan Ratigan: But in his defense, he needs our help. In other words, unless the voters are pushing people like yourself in Congress and unless the press is interrogating people like yourself, it’s hard for the president to get it done alone.
I’m curious what you think he could do better to get either more support from moderates on the Democratic side or more support from moderates on the Republican side to get that Fed audit, to have a real honest solution for financial regulation, instead of just appointing a new cop. Why don’t they actually… how do we get real change as opposed to baloney?
Ron Paul: I think we continue to do what we’re doing and we’re getting more attention on this audit bill than I ever dreamed of. It has to continue. We have to, you know, we’re up to 275. We have to get 350. We have to get 60 senators to finally endorse this. If this bill came to the floor today, either in the House or Senate, I don’t know of anybody that would vote against transparency of the Fed. The arguments are so strong, but we need more grassroots effort. The president himself, like you indicated, isn’t going to do it on his own, but if he sees more pressure from the people, calling their congressman and the senators. If their congressman is not on this bill, they need to be on this bill.
Dylan Ratigan: Bingo. Bingo.
Ron Paul: We need more support.
Dylan Ratigan: Congressman, I was calling you senator all morning. I’m going to call you congressman now. We love what you’re doing. Again, continue to give them… you know, listen, all we want is information. We get information, we can work it out.
Ron Paul: That’s right.
Dylan Ratigan: But hiding information, well, Goldman Sachs collects a hundred […] and AIG supported, GM is bankrupted. There’s too much, there’s too many backroom deals being done in there and they’re basically coming out of the taxpayers’ expense, sir.
Ron Paul: And if I have one second, I’d like to emphasize what you said, is this bill doesn’t take over monetary policy.
Dylan Ratigan: Exactly.
Ron Paul: This opens up the books. Monetary policy would still be done the same way, but we would have a right to know what they did and why and for whom.
Dylan Ratigan: Yeah, and it’s almost crazy that we don’t have that when you consider the amount of authority they have to move trillions of dollars around.
Ron Paul: Right.
Dylan Ratigan: Congressman, thank you.
Ron Paul: Thank you.