The dollar can’t save the whole world. The euro bailout only buys limited time and is a doomed effort to perpetuate a bad system. Eventually all fiat currencies will collapse.
Stuart Varney: From the phone from Lake Jackson in Texas, Congressman, always good to have you with us. Especially on a day when they bail out the Europeans to the tune of a trillion dollars. I can’t imagine you approve of this, sir.
Ron Paul: Hardly. You know, a trillion dollars here and there, pretty soon it’s going to add up to something. But no, it’s just astounding.
Stuart Varney: Can I just jump in for a second, I’ve got very limited time. And here’s what a lot of people are saying: look, the Federal Reserve is committing dollars, a lot of American dollars, to this bail out. Can you really say that the American taxpayer is helping to bail out the government of Greece and Greek pensioners? Can you really say that?
Ron Paul: Well, absolutely. And it’s not only the taxpayers who pay taxes, but it’s everybody. Anybody that buys anything will be taxed because this is inflationary and prices are going up already, producer prices are going up, the cost of living will go up. So everybody in America will suffer. And eventually the whole world will suffer because we cannot carry the whole world with our dollar. Eventually people will lose confidence in the dollar, and then we’re going to have wild inflationary problems. That’s what we face.
Stuart Varney: Do you see this as one more step down the road towards the ultimate crash of paper currencies?
Ron Paul: Absolutely. And I think last week we saw that gold all of a sudden started to act differently; it acted as a currency rather than just reacting to the value of the dollar or other commodities or the stock market. Gold has been money for 6000 years; it’s going to remain that way, and it will rule the roost and it’s telling us that the dollar is actually very weak. Although everybody’s buying dollars, the dollar is very week when you measure it against gold. And it’s been a steady downturn, and even though it might not go up a lot today, gold is the best measure, it means the dollar and all paper currencies are under attack and this cannot be sustained.
Stuart Varney: I’ve said on this program frequently that this is a bailout. It buys some time, maybe, but it doesn’t fix the underlying problem of European socialism. And I’m being very extreme in that, but I’m saying, “Look, you got an underlying entitlement culture here, which has run out of money, and this is only a bailout that simply buys time.” Would you agree with that?
Ron Paul: Oh, absolutely. And it’s going to make things much worse. Because the European banks that said they wouldn’t monetize debt have now agreed to do it. When I talked to Bernanke last time in the committee, he said, “Oh no,” they had no intention bailing out Greece, but they are through the IMF as well as opening up these swap lines to all the central banks. So it is on the shoulders and the burden of the American taxpayer and our dollars. So all we’re doing is perpetuating a very, very bad system. And this is not a solution at all.
Stuart Varney: Congressman Ron Paul, always a pleasure, and thank you very much for taking the time out on an extraordinary day for us. We appreciate it, sir.
Ron Paul: Thank you.