Alan Colmes: I’m Alan Colmes and I want to welcome back Congressman Ron Paul. Congressman Paul is serving Texas’s 14th district since 1997. Prior to that, he ran for President as the Libertarian Party candidate. In 1988, when I first had the opportunity to talk to him, and before he was in Congress, he has written several books. And now, Dr. Paul, I can’t believe it, why did you announce you’re leaving Congress?
Ron Paul: Well, it was time to go and it was time to campaign very hard for the presidency. And I can’t campaign for two things at once, even though I tried that last time. I wanted to concentrated on that, but I’m also ready to leave the Congress and I’m going to be working very hard through this next year and a half in keeping this job or doing this job, as well as campaigning for the presidency.
Alan Colmes: Why do you think you’ve got a better chance this than last time you ran for president?
Ron Paul: Well, it can’t be because I have different views. Hopefully, I can present them better, but I don’t think that’s it either. I think it’s the fact that the problems in this country have been building up, and the country has reassessed some of the things I’ve said, as far as spending too much and running up these deficits. Even Republicans now are starting to look at my foreign policy of less intervention; I know you’re familiar with that.
Alan Colmes: Ha, Ha, yea.
Ron Paul: And so I think because of the crisis that it built .. and you know, in the last campaign, I talked about this impending bursting of the housing bubble, and then when it happened, it built up credibility for some of the economic believes that I had. So I think that’s part of it. But the country is also very scared and they don’t see any easy answer. You know, I made the point before the Financial Services Committee that we spent 5 trillion dollars in the last 3 years. The debt went up 5 trillion dollars and there are no new jobs and the GDP has essentially stayed the same. So people are wondering what is going on, the old rules aren’t working. But that’s not a surprise to me, because I didn’t expect this to work.
Alan Colmes: Do you feel a sense of vindication that some of the things you said 4 years ago have come to fruition and some parts of the party seem to be coming around to what you’ve been talking about?
Ron Paul: Well, I think so, but I look at it less personally than as a vindication of what I consider correct economic policies. The economist that I have followed for years predicted the crisis, and now we weren’t expecting it to end by using the same policies. So in some ways, it’s a vindication of those philosophies and those believes. So I don’t think we can change our way, I don’t think we’re going to improve unless we reassess the policies that we, as a country, have accepted. And it isn’t a Democrat or Republican thing, because if Democrats want more spending for domestic welfare spending and it’s called Keynesianism, but the conservatives want military Keynesians, they say, “Well, you know, if you build more bombers, even if it’s a World War II bomber, that’s good for jobs”. That’s still mal-investment, its still debt. So I think that’s all being re-accessed. At least the people outside of Washington are demanding something different.
Alan Colmes: Do you acknowledge you may be a still a long shot to get Republican nominations?
Ron Paul: Well, yea, but it’s always been a long shot when I first ran for Congress, a long shot that I didn’t think I could stay in by voting the way I did. There were a few votes that I took all by myself, and people said, “What are you doing, you’re crazy, you’re not going to get re-elected”. So yea, I would say that I’m certainly not on the top of the list, but we live in very unusual times and I sometimes kid about that and I say, “Well, you know, that’s a risk you take. Once you put your name out there, you could be elected, it is possible.” But I also understand exactly what the odds are all about, but when I go out and I see what’s happening, and I hear from the college kids, I can get pretty encouraged, there’s no doubt about it.
Alan Colmes: Tell me about where we are in terms of the debt ceiling talks and Mitch McConnell’s latest foray seems to be, “Okay, President Obama, you do it on your watch, and we’ll then have the opportunity to vote on it, and then you can veto it.” Does that make any sense?
Ron Paul: It makes no sense, and it doesn’t make any sense if you think that we should have respect for the constitution. You can’t turn the strings over to the President and say, “By the way, we’ll sort of check on you after you do what you want to do”. So no, that doesn’t make any sense at all, and I don’t think it’s been well received according to the few people I’ve talked to. I have not done any polling, but my sense is that that’s not going to go very far.
Alan Colmes: How would you solve the problem then? How do we get beyond this impasse that we’re at right now?
Ron Paul: Well, with a great deal of difficulty. But first we have to admit the truth, we have to understand how we got here. If we don’t understand why we have a business cycle, why we have bubbles, and why they burst and why you have to have a correction, you can’t solve it. And we haven’t accepted the idea that you have to have a correction. A correction means you have to declare bankruptcies, businesses should go out of business, banks should go bankrupt and bad debt and the mal-investment have to be liquidated. But if you prop it all up, it will just perpetuate the problem. You know, when the banks got into all this mess, that’s where the biggest bubble was; it was on those derivatives and they became worthless. But they didn’t want the banks to go bankrupt, so they bailed the banks out, bought that and gave them money that they could buy treasury bills with, and they’re back in the business making huge amounts of monies. So the tax payer ended up owning these things, so that was exactly opposite. They should have been liquidated. Japan did the same thing, we did the same thing in the 1930s. So in these last 7, 8 years we haven’t accepted the idea that when things get out of control(?) you’re supposed to repair the damage and eliminate the bad debts so you can go back to economic growth.
Alan Colmes: But do you acknowledge that we need to raise the debt limit, though, in order to pay our bills at this point?
Ron Paul: No, I don’t think so. I think if you’re on a fixed income and getting into trouble, you could arrange it so that you pay your bills accordingly and pay the most important ones. So if the debt payments are the most important or Social Security – this idea of scaring people that there won’t be any Social Security checks, I think that’s just part of the game plan. But no, you can do it with the current cash flow, but you’d have to start cutting things and, of course, right now we keep expanding the expenditures overseas. We’re at 1.4 trillion dollars a year. And even the conservatives here don’t talk about what I talk about, which is cutting the spending. If we don’t do any of that, we’re going to have a major, major crisis within 12 to 18 months with a rampant inflation.
Alan Colmes: The President offered the Republicans 4 trillion dollars in cuts over 10 years, so the Republicans could be a little flexible and say, “Okay, let’s agree to the sun setting of the Bush tax cuts”, which was the original plan.
Ron Paul: Well, I wouldn’t agree to that because that, to me, is a tax hike. But I want to do a tax cut and quit doing the things that I consider not part of article 1 section 8. But I do have a list of priorities and I always go back to saying politically is should be much easier to cut the stuff overseas, rather than going to child healthcare. So I would have priorities. But if everybody here understood how serious it was and thought we should cut back, we could cut across the board. But we can’t argue for ever and ever, we’ll just cut and then pay our bills as we can and go back to work. But right now, it’s so difficult because the jobs aren’t available. You know, the tax system and the monetary system chases capital away. They’re afraid to bring their money back home because they’ll be taxed and weak currencies … it goes to stronger currencies, that’s why it goes east, it goes to China and other places, which is rather ironic. But the jobs follow the capital and nobody is really seriously considering changing that.
Alan Colmes: Is there a role for government in creating jobs, and what would that role be?
Ron Paul: Well, yes, they have a role, and that is to create an environment where businesses can create jobs. In a technical sense, the government does this program that will create a hundred jobs or thousand jobs; not in that manner. But if you have economic policies, such as sound money and market interest rates and savings that are reasonable and a proper tax code and a proper regulatory code and a proper foreign policy, that would create a general environment that would create jobs. But the people create jobs, the business people create the jobs and they go to the areas that are most efficient. When the government and bureaucrats create the jobs, they go to the wrong places. I mean, we created a lot of jobs building houses, people were very happy building houses, until they built twice as many as we needed. So they made a miscalculation. So we had good jobs, but now we don’t have any jobs. So that’s the kind of job creation I don’t like.
Alan Colmes: What do you have to do now to break through in terms of moving towards the Republican nomination in that process? What do you need to do personally to get yourself to the next level and achieve what you are working towards?
Ron Paul: Well, the best thing that could happen in my efforts would be to have the independents come vote for me, because that’s where a lot of my strength is. The Republican base is the hardest place for me to campaign, because they are much more pro-war and they have some civil liberty issues that I don’t agree with, or their lack of civil liberty positions. But no, I have to do well in these early ones, matter of fact, we’re working very hard just on straw vote in Ames just to prove that we are a good candidate, and that is a pretty good test. On these straw votes we do pretty well, because our supporters are very, very determined and very loyal and they are very energetic. So Ames lends support. If we did poorly in Ames, I’m not going to be very encouraged at all, it just a straw vote, but …
Alan Colmes: So that’s a big test for you.
Ron Paul: Yea, for me it is, and we didn’t do real well last time, so I certainly have to do significantly better than we did last time.
Alan Colmes: Is there any chance another Paul will take a run for your seat? I think Robert lives close to the district, is he thinking about a political career?
Ron Paul: No, I saw that reported, they asked him about it. He lives in Dallas, he practices medicine up in Dallas, Fort Worth area and we’re down in Houston, so he’s not close by and his heart isn’t in it. I think he has an interest because he’s in our family, but I don’t think he’s on the verge of seriously thinking about that.
Alan Colmes: Dr. Paul, I appreciate your time as always, thank you so much for talking to us. Hope we get to do it again soon.
Ron Paul: Thank you.
Alan Colmes: Thanks very much. That’s Ron Paul. We are coming right back at 877-4L and 877-367-2526