Ron Paul on Free Markets, Regulation, Auditing the Fed and Healthcare

Show: White House Brief
Host: Paul Westcott
Date: 11/4/2009 or 11/5/2009


Paul Westcott: Congressman Ron Paul, you spoke recently before the House Financial Services Committee during the mark up of what’s being called the Investor Protection Act of 2009. Really, you know, you were explaining the difference between regulation and bureaucracy. Can you explain that for our audience?

Ron Paul: Well, my complaint is that if you argue for the free market, that you don’t care about regulations and that everything is chaotic and that’s not true. There are two ways you regulate the market. If you do it by the free market, you’re regulated by the consumers, their choices and if they choose to bankrupt the company, the company has to go bankrupt, so you have bankruptcies. You have laws against fraud. You have laws against theft and there’s a regulation, but instead we sort of protect some of those things and we bail out the people who make bad decisions. At the same time, since the people who like government regulations don’t understand that the problems come from the Federal Reserve and the manipulation of the money supply that creates the business cycle, so they figure they can compensate. “We’ll just have more regulations.” All these mistakes being made as a consequence of bad monetary policies, “if we just have more bureaucrats checking up on everybody, we’re going to protect everybody.”

And my analogy is that it’s similar to people who would like to prevent any slander or any bad comments in newspapers. They have prior restraint. We don’t go to the government and say, “Well, check everything we say in the media.” Now, that would be preposterous, but you know, there still are restraints on the media and what people say and do, but as soon as it comes to economics’ prior restraint, we have to check everything, check it out and have the bureaucrats look over your shoulder. It causes chaos. It causes the prices to go up and contributes to the mistakes that the Federal Reserve makes.

Paul Westcott: Well, there you go mentioning the Fed. You know, you got a book out now, ‘End the Fed’ and there has been really a lot of discussion recently to grow the size of this organization. What’s latest ramp up looking like and is it just becoming more? Is it getting to a tipping point at this point?

Ron Paul: Yes, it’s getting pretty close. This bill we’re working on now these few more weeks. I don’t think it will be finished before we have our break for Thanksgiving. But it looks like the Fed will end up with more power. They always do. Of course, I’m working hard to go and try and at least get the books out so we’ll know what they’re doing. We don’t even know what all they’re up to. Barney Frank, the chairman, is not interested in the Federal Reserve taking over all this consumer protection bureaucracy. He’ll see that a separate group doing that.

Paul Westcott: Sure.

Ron Paul: But I believe that when we finally finish it all that the Fed would end up with more power, not less.

Paul Westcott: Well, and you know, turning to the health care bill, very hot topic obviously in Washington. As a Congressman and medical doctor, you’ve seen both sides of government-run health care through Medicare and Medicaid, of course. Would you say what we’re seeing right now going to the House and the Senate, are these bills going to benefit Americans in the end? I mean, I’m sort of lumping them all together, so feel free to break one off if you want. But do any of them really help Americans in the end?

Ron Paul: Well, like a lot of government programs, on the short run, some people seem to benefit. On the long run, it’s detrimental even to the people that it’s supposed to help. It is sort of like housing, when we had housing programs and the Fed pumping in the credit, it seemed like a lot of people were benefiting. You know, the prices of houses were going up and poor people had houses and it looked like a Golden Age. But then eventually, they’re the very people who suffered.

That’s the way it is in medicine. You pump in a new program like this, they’ll probably come up and say, “See, we can find these people that didn’t have any insurance and all this,” but ultimately it raises costs and diminishes service and there are shortages. So no, it’s very detrimental on the long run. And I think the real fallacy is they’re basing the need for all this that people are dying in the streets, you know, without medical care.

Paul Westcott: Right.

Ron Paul: But nobody is denied medical care in this country. I practiced medicine before we had government management and that coming in into the seventies and late sixties and nobody was turned away before nor since then. Emergency rooms take care of everybody and it’s just a bunch of scare tactics in order to get the bureaucracy growing and the special interest benefiting because there are too many middlemen in medicine.

Paul Westcott: Right.

Ron Paul: They do all the lobbying up here. The people when they come, the individuals, number-wise, more individuals are opposed to this, but the big companies. You know, whether they’re insurance or drug companies or management companies, they’re the ones. Even the AMA, they’re the ones who are pushing for some of this stuff.

Paul Westcott: Now, we’ve heard a lot of people in the sort of liberal intelligentsia as a word discuss the public option on how potentially you could move that public option to becoming a single-payer type system, government run, total government takeover of health care. From what you’ve seen, is that the direction some of your colleagues on the other side of aisle are leaning towards?

Ron Paul: Yes, that’s their goal and they say, “Oh, no. This would only be an option and a few people can join if they don’t have anything else,” but it would sort of like the public option on prescription drug program that the Republicans pushed through. It was a benefit to the corporations who were having trouble paying these benefits for the retirees, so they were very willing to dump it on the government. And even today, the public option of Medicare is not much of an option if you’re 65 and retired. I mean, you don’t just go out and buy Blue Cross insurance anymore. They don’t even offer it to you and the medical savings account, which was introduced by Republicans, which I think is a good idea, they’re prohibited if you’re over 65. So it’s always pushing you toward the government programs.

Paul Westcott: Sure, and just lastly here, I want to discuss the races in Virginia, New Jersey and in the New York 23rd. We saw a Conservative candidate getting 45 percent of the vote; Republicans take two very big seats. Should these results be taken as… I mean, everyone is talking about, of course, referendum on the President, but really, should this be taken as a warning to a degree to some of those Republicans who may have, shall we say, not been in touch with their conservative side so much over the last few years?

Ron Paul: Oh, I hope so and I hope it’s a sign that there is a trend away from more big government. It looks like that we could interpret that. But you know, it’s still a little bit early to tell and I think the biggest problem why there is this third party or tea party movement is that Republicans have lost so much credibility when they actually had a chance to cut back and they really didn’t do it. But it’s good that the people are unhappy with the status quo, which means that the group that’s running the show now are big government people and they’re very, very aggressive with it. So maybe this election will point out that they’re going too fast.

Paul Westcott: There you go. Congressman Ron Paul, thank you so much for your time.