In what might possibly be the Congressman’s last ever Congressional face-off with Federal Reserve head, Ben Bernanke, Ron Paul gave possibly his finest challenge to Ben Bernanke and the entire central banking system to date.
Over the years there have been some almost legendary exchanges with the current Fed Chair – like “is gold money” or “Ron Paul schooling Bernanke on currency devaluation”.
To be fair almost all of Ron Paul’s questions to the Fed Chair, be it Greenspan or Bernanke, over the years have been ‘must watch’ moments (just watch Ron Paul recommend back in 2000 that Greenspan look for new employment as an example).
Why have these moments been so gripping? Because Ron Paul seems for decades to be the only person to actually call the Fed Chairs on their faith in what will surely be remembered in history as a ‘pseudo-religion’ – namely ‘monetarism’.
In essence Ron Paul has been the only guy calling ‘BS’ on the entire system and has done it with such grace, humility, fearlessness and intellect that it has been impossible to ignore.
And Wednesday’s exchange was no exception – in fact, of all the Ron Paul encounters with the Federal Reserve over the years, this was his finest moment. Ron Paul managed to succinctly (5 minutes) call total ‘BS’ on the inflation data, proved that petrol prices are lower when priced in silver, say that inflation is theft and he then topped it off with a compromise solution that is brilliant in its simplicity and impossible to legitimately refuse.
Moments of genius:
- Ron Paul kicks off by asking “do you do your own shopping at the grocery store”? Bernanke simply replies “yes” – to which Ron Paul flashes back “so you’re aware of the prices”. The manner in which this question was asked was genius because it implies that the price rises in shops are so obvious that if Bernanke does shop there is no way he would have failed to notice what everyone else has – that prices have risen dramatically. Also note that Paul doesn’t say ‘price rises’ he just says ‘prices’ – implying that everyone knows which way the prices have moved that he doesn’t even need to say it.
- Ron Paul goes on to say that “nobody believes the 2% CPI inflation number” and that by using the same methodology of just a few years back to calculate the CPI it is running somewhere nearer 9%.
- Ron Paul adds “the people on fixed income are really hurting, the middle class is really hurting” because their inflation rate is very much higher than what the government tells them.
- Paying back money with devalued money is ‘theft’ – “somebody is stealing wealth and it’s very upsetting”.
- Where do people put their money if they don’t want it to be stolen by inflation?
- Ron Paul then reaches into his pocket and pulls out a silver ounce – back in 2006 (when Bernanke took charge of the Fed) and said that it would buy 4 gallons of petrol. Today it will buy 11 gallons of petrol – that’s preservation of value – in others words petrol when measured in a currency that isn’t being printed into oblivion has actually gone down in cost.
- But rather than leave it there Ron Paul offers up a solution – one that is a compromise, something that Ron Paul has spent his entire political life avoiding. He asks “why don’t we just allow currencies to run parallel… why don’t we legalise competing currencies?”.
- He then warns Bernanke that if he continues his path the “Fed will self destruct” – meaning that they will not stop until the paper money stops working and they will “End the Fed” themselves.
- Bernanke’s come back? “Good to see you again too”!
- On the matter of CPI 2% inflation numbers he just says that their done in a “serious and thoughtful manner” – he simply ignores the point that other indicators show inflation at 9% – very telling that he didn’t challenge that important point.
- Bernanke then tries to say that nobody prevents you from using gold and silver – missing the entire point. Because of legal tender laws gold and silver is taxed (sales tax and capital gains) and can’t be used to pay taxes. Simply put gold and silver are deliberately hindered from competing against fiat money because their are not competing equally – Ron Paul simply calls for removing this impediment and letting people decide what to use.
For lovers of people who don’t want their hard earned wealth stolen by inflation, for lovers of ‘real’ statistics and not government fudged numbers, for lovers of real, logical, intelligent economics and for lovers of people who demand freedom of choice in their money as much as their freedom of choice in the sandwich they buy, then thank goodness Ron Paul has been there all these years calling them out on this nonsense.
This clip is for you:
Whilst this very maybe the last time that you see Bernanke and Paul go head-to-head Ron Paul is still running for president – with the election coming in November.
There is plenty of time for the economic conditions to change by such an extent that the idea of President Paul is a very real one – After all Ron Paul is the only guy out of all the Republican candidates that nationally beats the incumbent Obama if the elections were held today – sorry, who’s that you say is unelectable again?
So was this the last time we’ll hear the Fed really challenged? From the looks of it Ron Paul is just getting started – and he’ll make sure he’s about when the Fed ends itself.
This article was previously published at Gold Made Simple News.