Mandeville, LA – If you missed the show today then you missed three hours of non-stop awesomeness straight to your eardrums. To be specific, you missed the King Dude chatting it up with Congressman Ron Paul on some of the issues most pertinent to our Country, like if there are any more Paul’s we can put in Congress besides Rand. Some of the other topics they touch on: Governor Palin being one of the lone aggressors against BernYANK-ME’s never ending print press, what would be discovered if the Congressman was able to audit the Fed, the unsustainable debt and how long unsustainable plans to remain unsustainable, how to find our way back to Liberty and Prosperity, the Heritage Foundation and their negative effects on life, and the institution of the asset bubble written, produced and choreographed by Ben BernYANK-ME.
It’s always good to have somebody second the motion we preach everyday, especially when that someone is as distinguished as Congressman Ron Paul.
Begin Mike Church Show Transcript
Mike: Pleased to welcome back on the Dude Maker Hotline, our friend and yours, ladies and gentlemen, and a man that I have had the honor of introducing at a speech in Orlando, Florida, Congressman Ron Paul. Congressman Paul, it’s always nice to talk to you, sir. How are you?
Congressman Ron Paul: I’m doing fine, thank you. Nice to be with you again.
Mike: Yes, sir. First of all, let’s talk a little family pride here. Just how proud are you of the chip off the old block Rand, and are there any other Pauls out there we should be looking out for?
Ron Paul: Not that I know of. Rand has two brothers and two sisters. I don’t know of any of them thinking about it. For now I guess we’ll have to settle for two.
Mike: You have the Paul caucus now. You have representation in the House and the Senate, right?
Ron Paul: It may be enough. We better see how we do first.
Mike: This is interesting. This just has to be — I’m talking seriously from the heart here — edifying and satisfying for you knowing that some of the things you have fought for your entire career in Congress, and even when you weren’t in Congress like back in the ‘70s when you were supporting President Reagan, some of the things you talked about and fought for in and out of politics. You have always said you believe the message is there and people will support it if you just articulate it. Isn’t your son living proof of that?
Ron Paul: I think so. I think at times, though, it could have been a mixed blessing for him. I think there’s a net positive. Over all those years, there was a lot of ridicule. We sort of are on the edge of mainstream politics, even though we believe in what we talk about. This means that maybe the balance has shifted. Rather than him being written off and saying: Oh, his dad has these strange ideas about the Federal Reserve and monetary policy and foreign policy; we won’t even look at him. He ended up winning with a substantial margin. I think that’s pretty good. In the meantime, they were able to use a few things to position, the opposition, to try to ridicule him on those positions, so he had to defend that. As you say, it looks like it’s been a net positive since he won the election. I hope our country is shifting in a direction of more limited government and the things we believe in.
Mike: Let’s talk about that for a second here. I don’t know what your personal take is on Governor Palin, but I do know that you are fans of anyone that questions the validity and the practices of the Federal Reserve. To her credit, the governor is the only popular Republican out there, other than you, that is talking about this insanity of Ben Bernanke printing this $600 billion. Did you see the governor’s speech? Did you hear anything about it?
Ron Paul: I saw clips on it and recognized the fact that she did. I think that’s very good. I think this may well reflect the fact that she’s good at politics and she knows what the people are thinking about and talking about and feels like it’s a safe place to be. Hopefully we helped to establish the groundwork for that where people are more comfortable in thinking about and addressing the subject of monetary policy and the Fed. I think that’s very, very good. I was glad to hear her say that.
Mike: I don’t know of anyone other than you that has made the Fed — you wrote a book End the Fed. Obviously you’ve had something to do with that. Let’s answer this question. You may have a chance — I don’t know if Joe Barton or Mr. Bacchus will become the chairman of the committee you’re on, the Banking Committee, or if you’ll move up in the ranking. Obviously you’ll have a better chance to interview and to maybe get some answers out of Mr. Bernanke. If you were actually successful in that bill that you had that made it through the Congress last year, the Audit the Fed bill, and it actually had some teeth to it, which Barney Frank and his buddies stripped out, what could you tell the listeners of why it would matter to them? What do you think you would find out or what do you hope you would find out if you were actually able to audit the Fed?
Ron Paul: Well, first off it’s a longshot. Although we passed it in the House, the Fed was powerful enough to get it stopped in the Senate as well as the conference. Even if it had passed there, I’m sure the president would have vetoed. Even if the president had signed it, then the next thing the Fed would do is fight it in the courts. The courts always rule in favor. Let’s say we go that next step and cross all those bridges and we do get an audit. I think it would expose exactly how they operate, why they create money, who gets the benefits, what they’ve been doing, what kind of agreements they’ve had with foreign governments and foreign central banks. I think the abuse would become quite evident. There may be some things that we can’t even conceive of that we’re going to find. The fact that they cling to this secrecy means there has to be a lot of things going on there that they don’t want the people to know about.
I think if the American people knew and they were much more interested in this now, they would say: For what purpose do they exist? Do we really need them? The Fed does more harm than good. They are the instrument of big government. You can’t have big government without a Federal Reserve because you’d have to pay your bills. You couldn’t print the money. Then you would have to tax people. Or if you had to borrow the money from other people or foreigners, interest rates would skyrocket and we’d cut it off. This is the way they’re able to fight wars and delay the payment. This way they can ratchet up the welfare state and not pay for it immediately and delay it. The longer they trust the dollar, the longer this goes on, and of course the bigger the bubble. This is what people would finally realize and say: We don’t need this; they’re the source of our trouble. It’s the monetary policy that ultimately has to be looked at because it is the way they finance big government.
Ron Paul: I’d like to say 78 but it was 77, but pretty close.
Mike: Congratulations again.
Ron Paul: Thank you.
Mike: I have a lot of questions I want to get to here today and we have a limited amount of time. A lot of people may be thinking, Congressman Paul, you hear a lot of talk about this debt is unsustainable and this path is unsustainable. You and I have been hearing this for four years. How long is unsustainable unsustainable?
Ron Paul: It’s unknown. It has a subjective factor involved. It’s trust. As long as the world trusts the dollar and trusts America and believes that we are the absolute military power in the world and that we are the richest country in the world, they will want to participate in the dollar’s standard. The dollar is not sound. If they lost that confidence, it would end tomorrow. The confidence is being lost gradually, but the end stage is it’s lost precipitously. Then there’s runaway inflation and a run on the dollar. It theoretically could last ten years. It most likely will not. I think it’ll last a couple more years. Hopefully we wake up before there’s a catastrophe and there’s a total run on the dollar, that we bite the bullet and say: This is tough to quit printing money and it’s going to hurt, but it isn’t as bad as allowing everybody to suffer the consequence of the destruction of the dollar. It is unknown.
We don’t know what the events will bring. If some idiot starts a war against Iran, that might be the precipitating factor. It may be something China will do. They’re moving out of dollars gradually and they’re buying up hard assets and minerals. If others start to do that and then China decides: It’s moving quickly; we’re going to get rid of as many of these trillion dollars we have as possible. Right now it’s in their interest not to do that. The endpoint is unknown. It will come. It’s unsustainable, otherwise we as Americans would never have to work again. We’d just print money and everybody would say: Whatever you want us to do. They all become slaves to us. Someday they’re going to wake up and they’ll not like to be slaves to us. I think they’re getting a little bit annoyed right now. Did you notice how many foreign governments like Germany and others started resenting the fact that we announced we were going to print another $600 billion? We’re getting closer.
Mike: Closer to the endgame is what Congressman Paul is talking about. Speaking of the printing of the money, let’s talk about asset bubbles here for just a second. I heard this morning on my way into the studio that the DOW is up to an unbelievable 11,320. Even though that is about where it was in 1998, it still is up almost 4,000 points over the low from early 2009, late 2008. Isn’t this a result — isn’t another asset bubble by the low interest rates being kept low for a year and a half now at near zero, isn’t this a result of the Bernanke policy? Isn’t he creating other asset bubbles that are just going to explode?
Congressman Ron Paul: He works very hard at that because he thinks that’s wealth. If you have more money in stocks, there’s more wealth, but the average guy on the street probably didn’t go back and benefit. He sold when it was high, when he had to sell. They’ve sold out so it’s just the people on Wall Street and the banks making the money. That is not real wealth and it’s not an answer. He does create these bubbles. I think the real bubble is in the bond market. I think they’re priced too high and interest rates are too low. I see them creeping up a little bit. Eventually there will be anticipation of inflation and there’ll be an inflation premium. That, I think, is starting to happen. Then the more they print, the greater the inflation premium. So far it’s worked, that the more they print, the lower the rates and they keep the rates down. That doesn’t drive the interest rates down on credit cards. Credit card rates are still high. That’s closer to a market rate. When the Fed creates this money, so far in the financial markets the rates have been lower, but eventually they’ll lose control of that as well.
Mike: One of the things I’ve heard you say recently is you explained, at the talk I was at, that you can’t replace something with nothing, and you explained to someone on Fox News a week or so ago: Look, there’s a reason why we want liberty over central economic planning, and it’s because of the opportunities created. I had wanted to ask you that same question. If you would, the Austrian School teaches us that we cannot accurately predict human nature like the central planners think they can, but we can predict the arc, not exactly what’s going to happen but the general direction it’s going to go in. How do you get back to liberty and back to prosperity and get back into that liberty curve and be influenced by the great Austrian teachers: Hayek, von Mises, Hazlett and what have you? Let me give you a minute or two to give the listeners a refresher or an introductory course in that.
Ron Paul: That attitude of the people has to change. When the attitude of the people is that they want a government whose purpose is to protect liberty, like was intended at the founding of this country — they didn’t set up a welfare state and they didn’t say go and police the world. The attitude was limited government. That, to me, is the most important. It’s an educational effort. Talk show hosts probably have more to do to spread a message than a congressman voting. If that’s what the people want, that’s fine. Over the last hundred years, the people have come to believe that we have a moral obligation to police the world, and that nobody can fall through the cracks, that the government has to take care of us because there are too many ruthless thugs out there in the free market that are going to destroy the people. They’ve lost their confidence. They don’t understand that the free market is what creates the prosperity.
When the people’s attitudes change, then you have to take the philosophy of economics and say: What does that mean? It means you can’t have a Federal Reserve because that just encourages big government. War is the health of the state. If you don’t want a big state, you can’t have perpetual war. You can’t have a war against drugs and war from the IRS and war at the airport and war overseas. This just enhances the State. Until we get there, we can expect the government to continue to grow. I think we’re getting close to the transition where what we have is unsustainable because we are broke and will have to make a decision. If we don’t go in the direction of liberty, the government has to become more authoritarian, and you see that happening, too, and you think about how many cameras on us, whether it’s on our highways or at the airport, every financial transaction. We can’t even go and leave our country and come back without a passport. We’re in a real death struggle in order to reclaim our freedoms and our liberties. That’s unfortunate for us.
Mike: We talk about it every day here. We’ll keep hammering it. Let me get a final question in here because I know our time is limited. Heritage Foundation came out with a newsletter yesterday, and you’re going to find this ridiculous as I did. They say that the defense budget, bottom line, conservatives must insist on $740 billion per year adjusted for inflation for eternity, and that does not include any foreign deployments or fighting wars. What would you say to the Heritage Foundation?
Ron Paul: It’s a sad story and they’re part of the problem or the problem. They’re worse than liberals because they neutralize the conservatives who believe in fiscal conservatism and balanced budget. They come in and preach that and the people go along with it. They are the problem. They’re not conservatives. They’re big government conservatives. They don’t represent the Robert Taft wing of the Republican Party that used to exist. They certainly don’t represent the founders that said we shouldn’t be the policemen of the world, that we shouldn’t interfere around the world. I’ve heard a couple new congressmen defend themselves, now that they’re elected. It’s going to be tough cutting this budget because there’s so little discretionary funding. Why isn’t everything on the table? You can’t cut this military-industrial complex budget. That is a key issue. Unless conservatives wake up — liberals, you expect them to spend money and they don’t believe that deficits matter. There’s a conservative element. The supply-siders said don’t worry about the deficit. We’ll cut taxes and that’ll expand the economy and generate more revenue for the government. What’s the government supposed to be getting more revenue? It never gets rid of the deficit either. I think you’ve touched on the issue that is key, that is outrageous. They’re the ones that have the most influence over conservatives, and that’s why we face this budgetary crisis.
Mike: I’ve been hammering this and I’ll continue to do so. I find it ridiculous. I find so much that comes out of the Pentagon and the Washington-military-industrial complex ridiculous. The sheer amount of money — I think one of the statistics I had heard from you was 11,000 bureaucrats per member of Al-Qaeda or something to that effect. I tell people all the time what I just told you: You don’t want the federal government interfering in the affairs of the people of Lubbock, Texas. You have a big problem with that. You don’t want the federal government interfering in the affairs at airports and what have you. You don’t want the federal government on your pig farm or whatever the case is. But you’re perfectly comfortable with the federal government if it comes from the Pentagon interfering in somebody’s affairs in Afghanistan or Iraq or Yemen or anywhere else on the earth. It’s the same thing.
Ron Paul: We have our president over in Indonesia right now talking about better relationships with the Muslims. I think that’s fine and dandy. He never suggests maybe not pursuing our foreign policy in the Middle East. We’re on a crusade. It’s called a crusade. They don’t like Christian crusaders. We’re crusaders. He thinks he’s just going to say nice things and all of a sudden the many millions of Muslims who have come to hate us because we bomb Muslim countries, we occupy these countries, they’re not even touching the real issue there. It’s so sad that we can’t see this. I think more and more people are starting to see it. Hopefully they’ll change their mind about our foreign policy.
Mike: They’ve got you and your son, a couple of us, myself. Pat Buchanan has been out there doing yeoman’s work as well. I know your time is limited. Congressman Ron Paul, ladies and gentlemen. It is always my pleasure and honor, sir. We’ll talk to you again real soon. Thank you.
Ron Paul: Thank you. Good to be with you.
End Mike Church Show Transcript