Show: Tavis Smiley Show
Tavis Smiley: Congressman Ron Paul from Texas is serving his 11th term in Congress. In 2008 he mounted a bid for the White House that galvanized an eclectic mix of supporters, including legions of young voters. He’s also a bestselling author whose latest is called “End the Fed”. He joins us tonight from Capitol Hill. Congressman, nice to have you on the program.
Ron Paul: Thank you, nice to be with you.
Tavis Smiley: Before I jump into the text, let me ask you a couple of quick questions about Afghanistan since it’s all over the news. The White House has basically said that we don’t need to send more troops, Rahm Emanuel I’m quoting here now, the chief of staff, to Afghanistan until they have a legitimate and credible government. Two questions: 1) What does “legitimate and credible government” mean to you when you hear that? 2) Even if that were the case, do we need to be sending more troops to Afghanistan?
Ron Paul: No, we don’t need to be sending any more troops over there. We need to be bringing our troops home. And this whole idea of a legitimate government – there is no answer to that. It’s virtually impossible to arrange that and who is going to make the decision? And one thing for sure is that Karzai can’t be legitimate because he is seen as a puppet of ours. And I think this election is basically a fraud. A third of the votes that Karzai was supposed to have gotten were ruled illegal. So, the whole thing is preposterous. I mean, the whole notion of us being there is ridiculous, and the sooner we face up to this, the better off we are going to be. We don’t really have the troops to send. We don’t have the money to spend, and it’s just a part of a foreign policy that I have been talking about for many, many years. It’s deeply flawed. And this is an example of what happens to it. You’re in a place for eight years, and then you start deciding “What are we hear for? What’s the purpose? What’s the endpoint? Who’s the government?” I mean, it is so foolish, I can’t imagine why the people put up with this. And I just wish more people would send a message to their congressmen and said, “We ought to deal with our problems here at a home, maybe we ought to concentrate on getting better medical care than just fighting another war which will continue to expand.” I think the whole thing is foolish.
Tavis Smiley: Much has been said today, as you will know, about the fact that President Karzai has agreed to a runoff election. You’re not buying his plan on that?
Ron Paul: Oh yea, he probably will. That means there is a lot of pressure put on him, and I wouldn’t be surprised if he’s going to be eased out. You know, sometimes we turn on our puppets. Remember back in the Vietnam days, when DM was our puppet and we had our CIA overthrow him, and actually kill him. So who knows what is exactly going on, but Karzai seems to be hard to defend. I am sure we were rooting for him in the election, which means that we were involved in it. And there was so much fraud they got caught at it, so it’s getting pretty hard to defend him. So yes, there has to be an election, but I won’t be surprised if our government quits supporting him. He can’t exist without our support. But the big problem is they don’t have anybody to replace him.
Tavis Smiley: I’m about to ask you this… some people believe that he’s not perfect. I mean, I don’t think the White House would tell you he is perfect, but the argument might be that he is the best of the rest.
Ron Paul: Yeah. Well, I think it will be hard to find anybody that will suit the situation. And whether you put in 20,000 or 40,000 or 80,000 [troops], I think it’s not worth the investment.
Tavis Smiley: So what should the President do then with this tough decision on Afghanistan? What should he do?
Ron Paul: I think they should come home and say that we did our best, we took care of the Al-Qaida, they don’t exist there and the 300 that did exist there are all dead or gone. And we ought to allow the Afghans to decide what kind of government they want. They don’t want a centralized government. They want tribalism. And we just can’t change that. People have been trying to do that for centuries, and it’t just not going to happen.
Tavis Smiley: One last question before I get to your book. The argument though is, as you well know, is if the U.S. were to pull out of Afghanistan or pull out of Iraq, you pull out of that region, the argument is that the whole region collapses and the apocalypse happens if you take Ron Paul’s advice and just pull out.
Ron Paul: Well, I think staying there is going to cause more trouble. I think the fact that we’ve been there for 8 years and destabilized the area… Afghanistan isn’t stable, but now Pakistan is not stable. Now we’re sending our drones over there and innocent people are getting killed and pretty soon we’re going to think about what we have to do to stabilize and get control of the weapons of Pakistan. At the same time they’re planning on expanding the efforts to overthrow the government in Iran. They’re coming up with real strong sanctions against the Iranians, and that’s not going to help us.
It’s just an endless task to continue to try to nation build and police the world. We weren’t meant to do that and we can’t afford it any longer, and it all has ramifications and blowback phenomenons that will be hurtful to us. I think it’s a real threat to our national security to be overly involved in that area.
Tavis Smiley: It’s a great segway to this book that you’ve written now called “End the Fed” which is already on the New York Times bestseller list, I might add. One listens to your answers now in this conversation about Afghanistan, one prepares to go into a conversation now with you about this new book called “End the Fed”. One gets the impression that Ron Paul, although a member of Congress, doesn’t trust government. Is that a fair assessment?
Ron Paul: I wouldn’t say I don’t trust all government at all times. I would say that most Americans, including myself, don’t fully trust that the government’s taking very good care of us. They don’t have a good foreign policy and there is something very untrustworthy about our monetary system. It is very, very untrustworthy and very unfair that it takes care of Wall Street, and at the same time it hurts the people because they end up with the inflation, they end up with the unemployment, they end up with losing their houses.
And yet the Federal Reserve, behind the scenes, in secret, can create trillions of dollars and bail out companies like Goldman Sachs. They can deal with world banks and world central banks, and we’re not even allowed to know. The Congress is so derelict in their responsibility, and this is why I of course want an audit of the Fed, but indeed what will eventually have to happen is ending the Fed because they’re going to destroy our money. We’re in the process of doing that. They set the stage for destroying the financial system and that has collapsed. But now, they’re just embarking on endless inflation, doubling the money supply, running up the debt, and spending and not even worry about it. “We’ll print the money if we need it”. That is a devastation to the average person. In countries where it gets out of control, the middle class gets wiped out. And that’s what I am afraid is going to happen here.
Tavis Smiley: You know, there are those who are watching right now, no doubt, who will say that you got it all wrong. That not only should the Fed not be ended, but if we were to do something like that, the timing couldn’t be worse, because it is the Fed and it’s Congress who you’re saying were derelict in their duty to put the money, pumped the money back into Wall Street that turned this situation around. Now they’re celebrating on Wall Street and passing out bonuses. And of course, the line is that jobs are always the last thing that comes around; that’s the last indicator. But how do you respond to those who say that this will be a bad idea, the wrong time for this idea, and if it weren’t for us pumping money into Wall Street, the economy might not be making a turn right about now?
Ron Paul: Well, there is a half-truth there. The TARP funds did go there to a large degree and we did prop up a lot of those businesses. That’s why some politicians go to Wall Street to raise money for their political campaigns. But the Federal Reserve pumps in trillions, and we’re not even allowed to know. With the TARP funds the people caught on and they demanded from Congress “What’s going on here? Why don’t you find out if there are any strings attached?” So, as bad as the TARP funds are and as bad as what the Congress has done, the Federal Reserve is that much worse.
Now, the answer to other question,that it could it be chaotic to get rid of the Fed – if you read my book carefully, I’ve talked about a transition for many, many years. Even in the foreign policy everything I talk about … how do you get from one stage to the next stage. And what I suggest here is not abolishing the Federal Reserve tomorrow, but legalizing some competition against the Federal Reserve, legalize the Constitution, legalize sound money. Parallel currencies are operating all the time around the world.
Tavis Smiley: What would competition against the Federal Reserve look like? Can you describe that?
Ron Paul: Well, gold coins and gold savings accounts could be used. Today if you use gold and silver as legal tender you go to jail. And yet the law and the Constitution say only gold and silver can be legal tender. But the courts always rule that the only legal tender is what the IRS says, and that’s Federal Reserve notes. But there is no law that says Federal Reserve notes are dollars. So it’s total chaos and that’s why you have the financial system in chaos. But you can legalize competition. For instance, in Mexico the middle class and the poor have been wiped out several times because their peso went to zero, and all their money becomes worthless. But in Mexico now, if you want to save, you can put it in silver and the accounts will be backed by silver, which means that you’re not going to lose. The lower the peso goes, the higher your silver prices go up. You can do that in this country, you can have a transition and if you want to use Federal Reserve notes you could, but other people could get paid for and make payments… with the computer age this is big problem. I mean, if you go to Mexico you can translate dollars into pesos very, very easily. So it could be done, and rather than looking for chaos and closing down the system. But if you continue what we’re doing now, you are going to get chaos because you’re going to have runaway inflation, destruction of the dollar. Now that is real chaos, not what I’m suggesting.
Tavis Smiley: Go back for me real quick and unpack what you were trying to say a moment ago that there are examples around the world where when these issues go unabated and go unaddressed, the middle class gets wiped out. Make the connection between the Fed and the middle class being wiped out.
Ron Paul: Okay, if the Fed continues to inflate the currency, that is to print money, the dollar looses value, which it is doing all the time. Mexico has had runaway inflation, Central American countries have had runaway inflation. We know about the runaway inflation in Germany, the most recent one in Zimbabwe. The money goes to zero value and the people lose out. But the very rich don’t lose out. They get bailed out and they don’t care about the cost of living. Right now they claim the cost of living isn’t going up and the elderly aren’t being heard. But the elderly didn’t get a cost of living increase this year on Social Security. But the cost of living for them is going up. Sometimes it goes up much faster for somebody living on a fixed income than somebody living on Wall Street. But here, instead of helping those people, we help Wall Street. And they’re making billions of dollars, they have a 120 billion dollars in the bank now to hand out in bonuses this year. At the same time, we have a 20% unemployment rate. I mean there is something very unfair about this system.
Tavis Smiley: I couldn’t agree more on that point. Let me ask you a final question here. In the book you talk about the fact, as we’ve been discussing in this conversation, your notion on how this country can prosper by addressing the Fed as it is now structured. But you also make the point that this is also tied to our freedom. I hear the prosperity argument. What’s the freedom argument?
Ron Paul: Well, the freedom argument is this: if you have a secret central bank which has been given the license to counterfeit money, they’re very, very powerful. So when governments grow, I believe when governments grow they always have to do it at the expense of the individual; whether it’s economic liberty or personal liberty or fighting wars that we shouldn’t fight. And there is always a cost to this. So if government grows and undermines personal liberty and passes more laws like the PATRIOT Act and all kinds of things, and you don’t have to pay for it. If everybody had to pay for this through taxes, we wouldn’t have this type of government. So we tax and then we borrow and then we still don’t have enough money so we print the money which then, of course, you accept the economic argument. But at the same time, the bigger the government is, the less personal freedoms we have. And this is a pretty well known fact. The maximum amount of freedom is when the government is smaller and the purpose of government is to protect liberty, protect our civil liberties, to protect our economic liberties, and make sure that we don’t get involved in these wars around the world. Because anytime you’re at war, you’re supposed to sacrifice for the greater cause. And people are more willing to give up on their civil liberties if we’re at war. So it is freedom issue to me.
Tavis Smiley: Ron Paul, of Texas, ran for president, if you recall, the last time around. He had a huge following of young people and made an impact in that campaign. He now has a new book out called “End the Fed”. Congressman Paul, glad to have you on the program. All the best to you sir.
Ron Paul: Thank you very much.