Tavis: Congressman Ron Paul is serving his 11th term in Congress from Texas. In 2008 he mounted a bid for the White House that galvanized an eclectic mix of supporters, including legions of young voters.
He’s also a best-selling author whose latest is called “End the Fed.” He joins us tonight from Capitol Hill. Congressman, nice to have you on the program.
Rep. Ron Paul: Thank you, nice to be with you.
Tavis: Before I jump into the text, let me ask you if I can a couple of quick questions about Afghanistan, since it’s all over the news. The White House has basically said that we don’t need to send more troops. Rahm Emanuel, I’m quoting here now, the chief of staff, saying that we don’t need to send more troops to Afghanistan until they have a legitimate and credible government.
Two questions: Legitimate and credible government. One, what does that mean to you when you hear that, number one, and number two, even if that were the case, do we need to be sending more troops to Afghanistan?
Paul: No, we don’t need to be sending any more troops over there, we need to be bringing our troops home. This whole idea of a legitimate government, there’s no answer to that. That’s virtually impossible to arrange that and who’s going to make the decision? One thing for sure is Karzai can’t be legitimate because he is seen as a puppet of ours and I think this election is basically a fraud.
A third of the votes that Karzai was supposed to have gotten were ruled illegal. The whole thing is preposterous. The whole notion of us being there is ridiculous and the sooner we face up to this the better off we’re going to be. We don’t have, really, the troops to send, we don’t have the money to spend, and it’s just part of a foreign policy that I’ve been talking about for many, many years – deeply flawed.
And this is an example of what happens to it. You’re in a place for eight years and then you start to decide, what are we here for? What’s the purpose and what’s the end point? Who’s the government? It is so foolish, I can’t imagine why the people put up with this and I just wish more people would send a message to their congressman and said, we ought to deal with our problems here at home.
Maybe we ought to be concentrating on getting better medical care than just finding another war to fight or continue or expand. So I think the whole thing is foolish.
Tavis: Much is being said, as you well know, today about the fact that President Karzai has agreed to a run-off election. You’re not buying the spin on that?
Paul: Oh yeah, he probably will, but that means there’s a lot of pressure put on him and I wouldn’t be surprised if he’s going to be eased out. Sometimes we turn on our puppets. Remember back in Vietnam days when Diem was our puppet, and then we had our CIA overthrow him and actually kill him.
So who knows what’s exactly going on, but Karzai seems to be hard to defend and now that there’s – I’m sure we were rooting for him in the election, which means that we were involved in it, and there was so much fraud they got caught at and so it’s getting pretty hard to defend him.
So yes, there has to be an election but I won’t be surprised if our government quit supporting him. He can’t exist without our support, so if we withdraw support – but the big program is they don’t have anybody to replace him.
Tavis: I was about to ask you. Some people believe that he’s not perfect. I don’t think the White House would tell you he’s perfect, but the argument might be that he’s the best of the rest.
Paul: Yeah, well, I think it’s going to be hard to find anybody that will suit the situation and whether you put in 20,000, 40,000, or 80,000, I think it’s not worth the investment.
Tavis: So what should the president do, then, with this tough decision on Afghanistan? What should he do?
Paul: I think he should come home and say that we did our best, we took care of the al Qaeda, they don’t exist there, and the 300 that did exist there, they’re all dead or gone, and that we ought to allow the Afghans decide what kind of government they want, and they don’t want a centralized government.
They want tribalism and we just can’t change them. People have been trying to do that for centuries, and it’s just not going to happen.
Tavis: One last question before I go to your book. The argument, though, as you well know, is that if the U.S. were to pull out of Afghanistan or pull out of Iraq, you pull out of that region, the argument is that the whole region collapses and the apocalypse happens if you take Ron Paul’s advice and just pull out.
Paul: Well I think staying there is going to cause more trouble. I think the fact that we’ve been there for eight years and destabilized the area – Afghanistan isn’t stable, but now Pakistan’s not stable. Now we’re sending our drones over there and innocent people are getting killed, and we’re pretty soon going to think about what we have to do to stabilize and get control of the weapons of Pakistan.
At the same time they’re planning on expanding the efforts to overthrow the government in Iran. They’re coming up with real strong sanctions against the Iranians and that’s not going to help us.
It’s just an endless task to continue to try to nation-build and police the world. We weren’t meant to do that and we can’t afford it any longer, and it all has ramifications and blowback phenomenons that will be hurtful to us. I think it’s a real threat to our national security to be overly involved in that area.
Tavis: It’s a great segue to this book that you’ve written now called “End the Fed,” already on “The New York Times” best-seller list, I might add. One listens to your answers now in this conversation about Afghanistan, one prepares to go into a conversation now with you about this new book called “End the Fed.”
One gets the impression that Ron Paul, although a member of Congress, doesn’t trust government. Is that a fair assessment?
Paul: I don’t trust the – I wouldn’t say all government at all times, but I would say that most Americans, including myself, don’t fully trust that the government’s taking very good care of us. They don’t have a good foreign policy and there’s something very untrustworthy about our monetary system – very, very untrustworthy and very unfair that it takes care of Wall Street at the same time it hurts the people because they end up with the inflation, they end up with the unemployment, they end up with losing their houses.
And yet the Federal Reserve behind the scenes, in secret, can create trillions of dollars and bail out companies like Goldman Sachs, they can deal with world banks, world central banks and other governments, and we’re not even allowed to know that Congress is so derelict in their responsibility and this is why I of course want an audit of the Fed.
But indeed, what we’ll eventually have to have is ending the Fed because they’re going to destroy our money. We’re in the process of doing that. They set the stage for destroying the financial system and that has collapsed, but now they are just embarking on endless inflation – double the money supply, run up the debt, and spend and not even worry about it. We’ll print the money if we need it.
That is a devastation to the average person that will – and in countries where it gets out of control, the middle class gets wiped out and that’s what I’m afraid could happen here.
Tavis: There are those who are watching right now, no doubt, who will say that you’ve got it all wrong. That not only should the Fed not be ended, were we to do something like that the timing could not be worse because it is the Fed and it’s Congress, who you’re saying was derelict in their duty, who put the money, pumped the money back into Wall Street, that turned the situation around.
Now they’re celebrating on Wall Street and passing out bonuses, and of course the line is that jobs are always the last thing to come around. That’s the last indicator. But how do you respond to those who say that this would be a bad idea, the wrong time for this idea, and were it not for us pumping money into Wall Street the economy might not be making a turn right about now?
Paul: Well, there’s a half-truth there. The TARP funds did go there to a large degree and we did prop up a lot of those businesses. Of course, that’s why some politicians go to Wall Street to raise money for their political campaigns.
But the Federal Reserve pumps in trillions, and we’re not even allowed to know. TARP funds, people caught on and they demanded from Congress, what’s going on here? Why don’t you find out? Are there any strings attached? So as bad as the TARP funds are and as bad as what the Congress has done, the Federal Reserve is that much worse.
Now, the answer to the other question about it could be chaotic getting rid of the Fed, but if you read my book carefully, and I’ve talked about this for many, many years, about a transition, even in foreign policy, everything I talk about, how you get from one step to the next stage.
What I suggest here is not abolishing the Federal Reserve tomorrow but legalizing some competition against the Federal Reserve. Legalize the Constitution, legalize sound money. Parallel currencies are operating all the time around the world, even in -
Tavis: What would competition against the Federal Reserve look like? Describe that for me.
Paul: Well, gold coins and gold savings accounts could be used and today if you use gold and silver as legal tender you go to jail. And yet the law and the Constitution said only gold and silver can be legal tender.
But the courts always rule that the only legal tender is what the IRS said, and that’s Federal Reserve notes, but there’s no law that says Federal Reserve notes are dollars. So it’s total chaos, and that’s why you have a financial system in chaos, but you can legalize competition.
For instance, in Mexico the middle class and the poor have been wiped out several times because their peso goes to zero and all their money becomes worthless. But in Mexico now if you want to save you can put it in silver and the accounts will be backed by silver, which means that you’re not going to lose. The lower the peso goes, the higher your silver prices go up.
You could do that in this country and you could have a transition. If you wanted to use Federal Reserve notes, you could, but other people could get paid for and make payments – and with the computer age this is no big problem. If you go to Mexico you can translate dollars into pesos very, very easily.
So it could be done rather than looking for chaos and closing down the system. But if you continue to do what we’re doing now, you are going to have chaos because you’re going to have runaway inflation and destruction of the dollar. Now, that is real chaos, not what I’m suggesting.
Tavis: Go back for me right quick and unpack what you were trying to say when you mentioned a moment ago that there are examples around the world where when these issues go unabated, go unaddressed, the middle class gets wiped out. Make the connection between the Fed and the middle class being wiped out.
Paul: Okay. If the Fed continues to inflate the currency – that is, print money – the dollar loses value, which it’s doing all the time. Mexico has had runaway inflation; Central American countries have had runaway inflation. We know about the runaway inflation in Germany or the most recent one in Zimbabwe. The money goes to zero value and the people lose out but the very rich don’t lose out. They get bailed out and they don’t care about the cost of living.
Right now they claim the cost of living isn’t going up and the elderly aren’t being hurt. Well, the elderly didn’t get a cost-of-living increase this year on Social Security but the cost of living for them is going up. Sometimes it goes up much faster for somebody living on a fixed income than somebody living on Wall Street.
But here instead of helping those people we help Wall Street, and they’re making billions of dollars. They have $120 billion in the bank now to hand out in bonuses this year at the same time we have a 20 percent unemployment rate. There’s something very unfair about this system.
Tavis: I couldn’t agree more on that part. Let me ask you a final question here. In the book you talk about the fact, as we’ve been discussing in this conversation, your notion of how the country can prosper by addressing the Fed as it’s now structured, but you also make the point that this is also tied to our freedom.
I hear the prosperity argument. What’s the freedom argument?
Paul: Well, the freedom argument is this: If you have a secret central bank which has been given the license to counterfeit money – they’re very, very powerful – so when governments grow, I believe governments grow, they always have to do it at the expense of the individual, whether it’s economic liberty or personal liberty or fighting wars that we shouldn’t fight, and there’s always a cost to this.
So if government grows and undermines personal liberty and passes more laws like the PATRIOT Act and all kinds of things and you don’t have to pay for it. If everybody had to pay for this through taxes we wouldn’t have this type of government. But we tax and then we borrow and then we still don’t have enough money, so we print the money which then of course you accept the economic argument.
But at the same time the bigger the government is the less personal freedoms that we have, and this is a pretty well-known fact. The maximum amount of freedom is when the government is smaller and the purpose of government is to protect liberty, protect our civil liberties, to protect our economic liberties and make sure that we don’t get involved in these wars around the world.
Because any time you’re at war you’re supposed to sacrifice for the greater cause and people are more willing to give up on their civil liberties if we’re at war. So it is a freedom issue for me.
Tavis: Ron Paul of Texas. Ran for president, as we recall, last time around, had a huge following of young people and made an impact in that campaign. He now has a new book out called “End the Fed.” “End the Fed,” his new book. Congressman Paul, glad to have you on the program. All the best to you, sir.
Paul: Thank you very much.