Ron Paul: Be Prepared for the Worst

Show: Freedom Watch
Date: 11/03/2009

Judge Andrew Napolitano: Hello and welcome to Freedom Watch, your daily dose of raw liberty streaming online at I’m your host, Judge Andrew Napolitano here defending freedom, depending your natural rights and defending your right to have a government that stays within the confines of the Constitution.

You’ve all heard me state repeatedly that everything the government runs is broke. Social Security is broke. Medicare is broke. Medicaid is broke. Amtrak is broke. The post office is broke. Now, the same bureaucrats that have run the government into the ground want to run healthcare and they also want us to believe that they can fix the economy and repair the damage done to the dollar by recklessly borrowing and ruthlessly printing money and by spending into the trillions. They forget that the government consumes wealth and only the free market can produce wealth. In an upcoming article in Forbes Magazine, Congressman Ron Paul says “be prepared for the worst.” The large scale government intervention in the economy is going to end badly.

It’s now my pleasure to introduce one of America’s great defenders of freedom and liberty today, Congressman Ron Paul joins us from our nation’s capital. He is the author of the New York Times’ bestseller, one of his several bestsellers, “End the Fed”. Congressman Paul, welcome back to Freedom Watch.

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

Judge Andrew Napolitano: Why should we expect the worst and what do you warn in this article that we should all expect?

Ron Paul: Well, as you said in your opening statement what has the government done right, and if you were going to turn medical care over to the government, their test was how well they could distribute vaccine for H1N1 and the question of whether it was necessary or not, all that exists. But they did that so poorly and intervene so viciously in our rights and that sent a message. I think that is part of the problem going throughout the society and throughout the markets right now. It’s that the government is just totally inept and the pretense is that the stimulus is working. You hear the liberal writers saying, “Oh, the stimulus has worked. All we need is more of it and it would have really worked.” Well, the trouble is it didn’t work. They took billions and billions, if not trillions of dollars away from the people and gave it to the government and the government spent it, which means they misallocated credit and resources and they make things worse, and so we haven’t changed anything.

This idea that the GDP went up, well, you know, they measure GDP by government spending as well. That’s included in it, so what is this? We either borrow the money from the Chinese or we print the money, we spend the money. It goes in and you buy up clunkers or buy up houses and say that, “Oh, the GDP went up.” Well, it has to be temporary and that’s been my argument. That’s my argument in the article, it’s that if you see economic growth returning, you’re kidding yourself because all the bad policies are in place and unfortunately from the people I deal with here in Washington, there aren’t very many free market economists or believe in the free market. They’ve all been trained and indoctrinated by Keynesian economics and they really don’t believe in freedom and sound money in the sense that I do.

Judge Andrew Napolitano: You point out in your article, Congressman Paul, that we are seeing some little snippets of growth here and there today. You called them some green shoots of growth, just as we saw in 1930 when Hoover and later FDR, of course, were trying to micromanage the economy from Washington D.C. Why do we see these snippets of growth and why should we reject the government’s claims that they are a sign of better things to come?

Ron Paul: Well, I think it is part of human nature because nothing goes down until the very end stages with a currency. The end stage is a currency does fall off a cliff and it goes down, but if you look at the dollar, the dollar has been going down for many, many decades. So all markets go up and down and have blips, but you have to look at trends. So because the market just really was bad a year ago, the fact that the, you know, a lot of money is pumped in and people are trying to stimulate things, even when they are artificial, it will look like there is some growth in the economy, but I think that’s all a delusion. I think it’s a mistake and the worse thing we could do is assume that what we have done here in Washington in the last year has been helpful. That is very, very dangerous because it has all been very damaging.t

Judge Andrew Napolitano: You predict in your article a drop in growth worse than anything we have seen in the past two years. What are you talking about?

Ron Paul: I think the whole economy is going to be much weaker. We’ve had a financial collapse. The financial system was built on a house of cards, which was the fiat dollar standard and it was international because it was the reserve standard, But we haven’t had a dollar crisis. As a matter of fact, the dollar is benefiting to a degree right now because there is still a lot of dollars out there and people don’t even know where to park it, so they park it in Treasury bills, which helps the Fed and it drives down the interest. It helps the government, but that is all temporary.

When the dollar collapses, what happens is the people will recognize what you said earlier on, that everything the government touches is bankrupt and when that comes about… already we saw an early sign of this, the Social Security beneficiaries didn’t get any cost of living increase this year as a pretense that, “Oh, you know, there really wasn’t any inflation and we’re going to straighten up our house.” But eventually everything the government touches and passes out, the dollar will lose its value, so the more dollars they print, the more value it loses.

So far, they have been lucky enough, but they printed dollars and the people have taken it like Goldman Sachs and others keep making more and more. But eventually, this dollar is going to quit working and then everybody is going to know what poverty is all about.

Judge Andrew Napolitano: You and I have talked about this off air, but we keep hearing rumors and snippets in references in the blogs to it. Are you considering running for the nomination of a party for president in 2012?

Ron Paul: Not seriously, but you know, I listen to them and that’s a long way off. I think more about what the dollar is doing today and what we’re going to do with healthcare and a few other things, so my plans aren’t that far out. So no, I’m not giving it serious consideration.

Judge Andrew Napolitano: But you must know that there are millions out there that would ardently desire this. We did Freedom Watch last week before a live student audience at Drexel University in Philadelphia, in the same room where then Senator McCain and then Senator Obama debated in one of the debates a year ago. Everybody was asking me and these are students, “Is Ron Paul going to run for president?”

Ron Paul: Well, Judge, I think it might be your turn this time around. So you and I have to have another private conversation on this.

Judge Andrew Napolitano: Congressman Paul, it’s always a pleasure. Thanks for joining us on Freedom Watch.

Ron Paul: Thank you.


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  • Peter

    Well Matt if you want to buy his book you can get your answers and argue with him later.

  • John


    What I forgot to mention is that the dollar is currently used as a standard for oil trading and the international powers like China and Russia along with the oil producing countries want to drop the dollar as the standard currency used to trade oil. This means the dollar is being devalued and if you have the same amount of dollars or more in circulation than the value of each dollar drops – inflation.

    • Matt

      I don’t think you understand much except what you parrot from headlines, alarmist blogs, and propagandist youtube videos. Fine. I will ignore the legitimacy of what *could* happen in favor of adhering to the original statement I made.

      If you are saying that if the dollar is no longer a reserve currency means it will be ‘devalued’, then it having been a reserve currency means the opposite HAS ALREADY occurred – it was ‘valued’. You can’t be a reserve currency and be devalued AND not be a reserve currency and be devalued. Again, you are saying that the US dollar HAS NOT “been going down for many, many decades.”

  • John


    The dollar has been dropping for decades, i.e. a carton of milk is more expensive now than its was in the 90’s, 80’s, 70’s and so fourth. 100,000 dollars is not worth today what it was 20 years ago. Have you noticed everyday gold hits new records and the value of the dow compared to gold is dropping, this is one way of noticing the dropping value of the dollar. His statements are rooted in fact and reason. Think about how much wealth this country would have if the fed did not every print more money, 100,000 dollars would still be worth what it was decades ago, therefore, both you and I would have more purchasing power with the same amount of money. This is how the gov’t intervention has hurt us, by printing more money and making each dollar we own drop in value over time, its not an overnight thing, it can take many many years for inflation to take effect.

    • Matt

      “Have you noticed everyday gold hits new records and the value of the dow compared to gold is dropping, this is one way of noticing the dropping value of the dollar.”

      Thanks for contradicting yourself so obviously. Well then sir, if the value of the DOW compared to gold is one way in which you value the dollar (which you say it is), why then aren’t you saying that the dollar has STRENGTHENED LOGARITHMICALLY over the past 200 years?

      “The dollar has been dropping for decades, i.e. a carton of milk is more expensive now than its was in the 90’s, 80’s, 70’s and so fourth.”

      OK, so do you get paid more than you did in the 1970’s? I am confused, are you saying that you get paid in 1970 dollars and at a 1970 salary and you are trying to purchase milk at 2009 prices. If it takes you 15 minutes worth of labor to purchase a gallon of milk then, and 15 minutes now (for example) how is that the value of the dollar dropping (since you like to use ratios)?

      • John

        I know the milk thing is hard to understand, but lets break it down. Milk is woth more DOLLARS now than in 1970. Its not necessaryly valued higher. So then why does it cost more when its still valued the same? Well, the medium of exchange, the dollar, has dropped in value, therfore it takes more dollars to ge the same thing – Milk. I know everyone and their brother gets paid more money now than in 1970, thats another way of noticing the value of the dollar decreasing – thats infltion. Your work is not valued more now than in 1970, it just takes more dollars to pay you for the same amount of work because the value fo the dollar is less. One dollar today will not get you as far as one dollar in 1970, so the value of the dollar is less than it use to be. This continues to occur, the dollar continues to drop in value because the fed continues to print money. Supply and demand. Furthermore, the reason the value of the dollar has not increasd in value logarithmically is becaue the number of dollars in circulation has not remained the same. For if it did then the dollar would have increased logarithmically. We have printed billions if not trillions of dollars in that time – this is one reason the FED needs to be audited. We don’t know how much has been printed therefore we really don’t know the true value of our dollar. Sad but ture.

  • Matt

    “The paranoid spokesman sees the fate of conspiracy in apocalyptic terms—he traffics in the birth and death of whole worlds, whole political orders, whole systems of human values. He is always manning the barricades of civilization. He constantly lives at a turning point. Like religious millenialists he expresses the anxiety of those who are living through the last days and he is sometimes disposed to set a date fort the apocalypse.”

    Looks like RP isn’t the lone voice for saving our country, just the latest paranoid spokeman to make a very good living doing so!

  • Matt

    So at what point do we just call a broken record a broken record?

    “But eventually, this dollar is going to quit working and then everybody is going to know what poverty is all about. ” – Ron Paul, 2009

    Wait, I know how this statement always ends! Here you go, substitute ‘2010’s’ for ‘1980’s’ and you will see the same thing:

    “We probably will see widespread civil disorder in the 1980’s as a direct result of our faltering economic system.” – Ron Paul, 1981

    Ahhhhhhh the sky is falling!!!! Buy gold, guns, and ammo! Eventually it will happen! I wasn’t right then, but NOW, NOW I actually mean it!!! Ahhhhhhh!

  • Matt

    at 4:15 he says “the dollar has been going down for many, many decades.”

    WTF is he talking about? I like how he just likes to toss out unclarified and inflammatory lies/deception like this.

    Further: “As a matter of fact, the dollar is benefiting to a degree right now because there is still a lot of dollars out there and people don’t even know where to park it, so they park it in Treasury bills”

    WTF, why is Ron Paul now questioning the wisdom of markets? REALLY Ron Paul, they don’t know what to do with their money?!?! There are ZERO other investment opportunities or vehicles out there in the WHOLE WORLD?!?!? Really Ron Paul?

    Not only that, but this isn’t a free market decision people are making that you should understand and respect? Instead people are effectively being forced to buy Treasuries with a gun to their head? NO. The free markets are doing what they do best – invest and allocate capital. If inflation were such a threat, and if a coming US Dollar armaggeddon were to occur, why wouldn’t free markets be piling into EVERYTHING except treasuries?

    I really like his ‘when markets go down its the governments fault, and when they go up it is not real and due solely to government intervention’. Heads I win, tails you lose.

    I’m not sure Ron Paul would know what free market activity is if a forward contract hit him upside the head.