End the Crisis – Let Freedom Operate!

The FCIC: Passing the Buck

by Ron Paul

Last week the federal government’s Financial Crisis Inquiry Commission held hearings as part of their continuing investigation into the causes of the acute economic meltdown which occurred in late summer 2008. This bipartisan commission, partly inspired by the Pecora Commission- which investigated the causes of the Great Depression- is expected to report back to Congress before the end of the year.

Things don’t seem to be going well. The individuals questioned by the commission mostly seem to be diverting blame for the whole fiasco to someone else. Nobody is offering any tangible insights into the causes of the financial crisis.

Predictably, the commission will avoid calling any witnesses who might unequivocally indict the federal government for its role in the crisis, or suggest solutions which take away government power. Government commissions have a remarkable tendency to recommend granting even more power to the same useless government agencies that so utterly fail to prevent crises in the first place. We saw this with the Pecora Commission, we saw it after 9-11, and we’re seeing it again today with regard to financial regulations. For example, this latest commission almost certainly will suggest granting more power to the SEC, when in fact the SEC should be abolished as an embarrassing farce. Rest assured that this recommendation will be made without apology or sense of irony.

The reality is that the Federal Reserve relentlessly expanded the money supply through artificially low interest rates for over two decades, and this expansion of easy money caused a wholly predictable bubble. To a myopic Keynesian regulator, the bubble may appear to be caused by greed, but in truth it is completely predictable that humans will act in their own perceived self interest. If the Fed wants to dole out artificially cheap money, people and businesses- including Wall Street businesses- will line up to take it. We can condemn this as greed, but the fundamental problem is Fed policy itself. There will always be demand for cheap money, but we should not allow the Fed to debase our currency and create bubbles of false prosperity to satisfy that demand.

What the commission really needs are experts who understand free market economics rather than big government Keynesian fantasies. The commission has none of these, and has called no true free market witnesses. That perspective would only distract from their predetermined goals.

The commission will bemoan the complexity and inscrutability of our economic problems, but the solution is simple: allow freedom to operate in our markets. Allow U.S. financial, labor, and housing markets to normalize without political interference. Though solution is simple, and rather obvious, it would not be easy or painless, but we’d be so much better off for it in the long run. It would require admitting fiat money is a tangled web of monetary deception prone to catastrophic failure. It would require allowing Americans to choose a system of sound money, where the money supply and interest rates are set by market forces rather than centralized economic planners. Unfortunately, fiat money is like a drug to a Congress hopelessly addicted to spending vastly more than the Treasury collects in revenues. Because of this, our problems can only get worse and more complex before they get better.


  • Cole Rodrigues

    Dear Ron Paul,
    Some of the comments clearly are misunderstood as you are truly understanding how ‘we’ as a nation have been sucked into the deception of governement benefits leading us to a lazy nation and overly demanding false successes to be dependent on Government. When you explain what the people are experiencing today and historically have expected with not just participating in government depending upon it’s entity gives me peace. Since you undertsand and can see clearly what we have gotten ourselves into. The television is the media of deception and makes it easy for us to escape it all and pretend nothing is happening.

    We have forgotten the ancient times and history of what we have gained in freedom and that our country was founded by Christians and lead by God. For the people who think, Governement is sustaining them, I am praying that they will experience the power of God in their life and take a stand to think outside the box that we have been lead into.

    Money is not the issue that will solve our problems, but, coming together as real people in community and service and hope. You have offered this to me as we all are not trusting in any campaign. My wish has been to take the money out of the campaigning, submit your resume to all, and let us partake legally in a true voting system, for the people by the people.

    Do we have any strength in God anymore to lead us morally and ethically and TOGETHER as one Nation Under God? Please people realize that the Government can’t solve your problems but, God and thru the people together in unity can. God Bless this Nation and may you all remember Ron Paul for his true efforts in Justice. Ron, please don’t give up and pray for all your guidance to be like our founding forfathers that founded this nation. Remember the good ole days? Remember when we were not lazy but, worked hard and gave 10% to the governement, supported our familys by living by and with them offering care, we used herbs and natural remedies to assist us in healing, we didn’t run to the store to buy yellow and blue artificial foods causing cancer because it was quick and easy, we didn’t work all the time excluding care for the land and family because money was so much more important that living clean healthy humble lives, and were able to die naturally and be ok with it?

    I refuse to pay for abortion and am supporting thinking outside the government box to then counteract it with Carenet organizations that will be across the street with loving people letting mothers of teenagers and teenagers that are alone and scared. Oh, people, please know that you haven’t even read the bill! We don’t even have that right anymore.

    It’s a time to look to God for all solutions and wake up!
    Cole Rodrigues

  • You are exactly right.
    Nothing but finger pointing is happening.

    The following two pages will explain what I believe is really happening



    Bottom line, I believe the 20 plus million people that cannot find work cannot find work because our corporations have sent 20 plus million jobs offshore to fatten their bottom line at the expense of their country.

    Case in point, go to my website at http://www.KeepAmericaAtWork.com and look at the jobs on the right hand side.

    These jobs are posted by a company based out of Maryland, but their recruiters are in Bangalor

  • Bess Horsefall

    Dr. Paul, I’m truly shocked by you. Your intelligent and difficult opinions have given way to rhetoric. I heard you say that the “people want to be taken care of by the government.” That is the most unrealistic thing I have heard you say. You do not represent me anymore. The government role in helping the poor keeps them from marching in the street, being victims of free enterprise. Free market has its victims and your characterization of those victims as “wanting” federal care is incredibly insulting. If you ever got federal help you would know how crushing and inhuman it is. Shame on you.

    • Brian

      Is it really that unrealistic? I’ve had friends brag about being on unemployment because they described it as “free money.”

      The people who oughta be ashamed are those who don’t pay taxes and want free handouts. The greatest gift you can give someone is opportunity.

      And how does the free market have it’s victims? Please explain. Everyone has the opportunity to go out, work hard, and succeed in a free market society. Instead of going out and marching on the street, go out and get a job.

    • gander

      the victims of the free market are the weak and the inferior. good riddance. i hope all these “victims” starve when their welfare runs out and stop polluting the gene pool.

      and to brian, the people who ought to be ashamed are the ones who pay taxes. they are dumb enough not to avoid them and their extortion money goes to supporting the refuse of society.

      • Fred the Protectionist

        Yeah, down with the inferior races which “pollute the gene pool”.

        Survival of the fittest, YEAH, anarchy, YEAH, go Ron Paul, lets bring on the Anarchist Utopia.

        • gander

          fred is a creationist. YEAH.

          • Fred the Protectionist

            Boy you can’t stick to the topic very well, ok i’ll play.

            Energy and mass are conserved, meaning it can’t be created or destroyed naturally. That means energy/matter came into being SUPERnaturally.

          • gander

            so then god’s mass and energy could also only be created supernaturally. that proves that he was created by zeus with a thunderbolt into hera’s private parts. god then killed the greek gods when baby jesus was born and we all live happily ever after. my story makes just as much sense as yours.

          • Fred the Protectionist

            You are incapable of rigorous thought.

    • longshotlouie

      On the bright side, Fled and Gander have found each other.

      It’s a beautiful thing.

      • Perhaps they have brainwashed each other with such propaganda. That was hilarious Longshot. LOL!

  • i was just askin if we go back to shound money how would we do it please right back & keep up the good work : )

    • Sincerus

      Jason—Ultimately the value of gold and silver: It has always been seen as real money, regardless of what governments say.

      Dr. Paul speaks approvingly of America’s nineteenth-century monetary policies, during which time we had a “functioning gold standard” as well as “classical liberal economic policies and limited government,” which “set the stage for the greatest economic growth in history” (all quotes from Gold, Peace, and Prosperity).

      It started with the Federal Reserve Act in 1913, and the establishment of its banking system. The Fed regulates its member banks and, to some degree, controls the nation’s money supply. Initially, the Fed operated under the gold standard — dollars could still be redeemed for gold with the U.S. Treasury.

      But when World War I broke out just a year later, redemptions were suspended, and although they were later resumed, in 1934 FDR and Congress passed the Gold Reserve Act, effectively making it illegal to own gold. FDR also revalued the dollar relative to gold, intentionally causing inflation, and finally, in 1971, America was taken off the gold standard altogether.

      This marked a new epoch in big government. Previously, so long as the government had to redeem dollars at a fixed rate of gold, it had to be cautious with expansion of the money supply. For example, under a gold standard, the government couldn’t just print $100 billion in new money to fund a war, because if it did, soldiers and defense contractors may wish to redeem their dollars for gold reserves, and the government might not have them. But by going off the gold standard, the limitations on “limited government” were all but removed.

      “I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs”
      Thomas Jefferson,
      3rd president of US (1743 – 1826)

      • Fred the Protectionist

        Yes we all know, Usury is bad.

        • Citizen

          Hey Fred the P.
          I’ve missed you lately, how ya been?

          Your right usury is not good and
          We the People have been the victims of that Political & FED usury.

          Compound the escalating effect of higher taxes onto inflated currency on higher taxes on inflated currency and presto-change-o
          NO ECONOMY and NO JOBS!

          Even Maynard Keynes didn’t preach constant steroid use (aka currency inflation)
          The American super athlete economy just had a steroid induced heart attack,
          And Barack, Tim, Barney and Ben are yelling…
          “QUICK MORE STEROIDS!!!”

          • Fred the Protectionist

            Deficits do not create inflation.

        • gander

          usury is good. if it were bad no one would take the loans.

          • Fred the Protectionist

            If usury is so good, then why y’all bitching about the “banking industry”?

            And why do atheists care about usury?

          • gander

            the fed is not the same thing as the banking industry.

            atheists care about usury because most of them are socialists with guilt issues because daddy never loved them enough.

          • Fred the Protectionist

            What’s all this bitchin’ about “international bankers” and “bankers” and all, then?

          • gander

            that’s only you jesus freaks going on about the money changers, not me.

        • Sincerus

          Fred —- Is that sarcasim I sense? Or just trollin?

          History is littered with the fact that even military conflicts and imperialism are prevalent marks of the course of usury. The revolution which established the United States is but one example. The struggle to establish usury here marks the whole course of our history until those efforts succeeded in 1913. Fifteen years later, the world’s first Great Depression foreclosed on as many as 50 and 60 thousand homes or farms in some U.S. counties in a single month. Bankruptcy and foreclosure are not only prevalent marks of the course of usury; prevalent foreclosure and bankruptcy are even unique to usury.

          • Fred the Protectionist

            Yes I know, like every other Christian or non-religious thoughtful person, usury is bad. So there should be laws against it.

          • gander

            taking a loan with a high interest rate is a conscious choice. outlawing such loans implies that people are too stupid to make their own decisions. if you adopt that line of thinking then you also have to accept the nanny state which tells you what to do with your life, body and money.

            sometimes religious people get confused between the role of god and the government and that is when they start getting all these silly laws passed.

          • Fred the Protectionist

            If you’re not going to do anything about it, then stop complaining about the “banking industry”.

            And usury is bad whether your a bible thumper or a Godhating atheist.

      • Citizen

        Dr. Paul has been preaching sound money fundamentals for near 30 years now. He knows that as long as the our politicians continue to allow the FED to debase our currency, more dollars will be chasing after fewer and fewer goods made in the USA.

        Jobs leave the country because of wage inflation which chases jobs overseas! Add Tax inflation (ever higher taxes) to Currency Inflation (debased money printing) and you get a double compounding of the problem both Wage and Commodity price inflation.

        The US economy is like a super athlete track star collapsed on the track because of excess steroids, yet Congress and the FED are racing in with syringes full of more steroids, ENOUGH ALREADY!

        We need DETOX not more FED STEROIDS!

        • Fred the Protectionist

          There is no wage inflation, wages have been going down.

          • Citizen

            Your correct again, we have wage “Deflation” because of an economic depression. NO JOBS

            Add to that, the Federal Reserve Note (FRN) (dollar) is so diluted (debased) the world is beginning to reject it as the “reserve currency”

            When the FNR collapses, another 20% plus of US will be unemployed.

          • Fred the Protectionist

            Wages have been stagnant or going down ever since the free traders started destroying jobs in the 1980’s.

    • Citizen

      Hey Jason a Gearheart,
      By most monetary history standards, the Federal Reserve Note (FRN) dollar is near death. Its almost impossible to salvage the FRN now that so much bogus cash and cyber-cash has been injected into the system.

      Even Dr Paul and others doubt that our FRN currency has much of a chance.

      There are two possible currency solutions
      1. HYPERINFLATION- the FRN dollar collapses and no one will use it, the apparent choice of the current Administrations. A plan that many on the New World Order band wagon would applaud, forcing America to use a World Bank Note, more of the same, only worse

      2. DEVALUATION, turn in your old FRNs for new Treasury Notes backed by Silver at a 20:1 redemption ratio and KILL THE FED. Painful but doable
      Raise RESERVE requirements to 100% on Demand Deposits! NO MORE FRACTIONAL RESERVE BANKING, Goodbye Rothschild corrupt banking

      • Fred the Protectionist

        “By most monetary history standards, the Federal Reserve Note (FRN) dollar is near death”

        No it’s not. It’s the strongest currency on the planet.

        Dang, you know when your wrong your wrong, gee wiz. This is why people laugh at Ron Paul and Libertarians in general.

        • SS

          The dollar is the strongest of all of the dead and dying fiat currencies.
          The gig is up.

          • Fred the Protectionist

            “The dollar is the strongest of all of the dead and dying fiat currencies.”

            Absolutely, it’s all relative. Because many countries peg their currencies to the US, and will continue to do so nomatter what. So whenever a trade deficit FORCES the fed to print more money, most other countries also print money proportionally to what we print, leaving the only side effect being the rich get richer the poor getting poorer and the middle class disappearing. Why would you free traders want that? That’s not right.

        • Sincerus

          The history of fiat money, to put it kindly, has been one of failure. In fact, EVERY fiat currency since the Romans first began the practice in the first century has ended in devaluation and eventual collapse, of not only the currency, but of the economy that housed the fiat currency as well.

          The dollar has already failed. It has lost over 92% of its value since its initial issuance in 1913.

          • Fred the Protectionist

            All money is abstract, even gold.

        • Citizen

          All world Governments are debasing, diluting and inflating their currencies along with the FED and our Dollar.

          Hard commodities, metals, oil, and minerals are the Benchmark standards that are the real measure of ALL the world currencies declining buying power.
          They can print tons of paper and key up trillions of (cyber-cash) fiat currencies, but not so with tangible commodities.

          Constitutionally, 77 grains of silver defines our Dollar, not Ben or Tim.

          • Fred the Protectionist

            “Constitutionally, 77 grains of silver defines our Dollar”

            No it doesn’t. Libertarians know nothing of the Constitution, this is just more proof of that fact.

            And your free trade FORCES the fed to print money lest American citizens are left to barter with euros or pesos.