Questions for Ron Paul

Last year, the Atlanta Conservative Examiner published an article that asked several questions of supporters of Barack Obama. While well-intentioned and honestly seeking the liberal perspective on a number of issues, the response was underwhelming. Perhaps this was because there are no good answers to the questions asked.

In a similar vein, here are several questions for Republican presidential candidate Rep. Ron Paul and his supporters. Judging from the large response that typically comes from any article mentioning Ron Paul (especially when it mentions him critically), the Paul supporters are likely to have more to say in his defense than the Obama supporters did.

First, Ron Paul makes a point of saying that the Federal Reserve is unconstitutional on the grounds that the Constitution gives only Congress the power to “coin Money, [and] regulate the Value thereof….” (Article I Section 8). If this interpretation is correct, then why is it that Congress established the first private central bank, the Bank of the United States, within a few years of the ratification of the Constitution? At that point, many of the framers of the Constitution were still in Congress.

The Bank of the United States was a private company. The bill establishing it was signed into law in 1791 by none other than George Washington. After the bank’s charter expired in 1811, Congress created the Second Bank of the United States in 1816. This bank existed until 1841. At 99 years old, the Federal Reserve is the longest lasting central bank in U.S. history, but it was far from the first.

Also along economic lines, Ron Paul advocates a gold standard, which leads to another question. Paul blames fiat money and the Federal Reserve for the current economic unpleasantness, but even when the U.S. was on a gold standard the business cycle led to periods of economic depression. In fact the Federal Reserve and the gold standard coexisted for decades. The gold standard did not prevent the Great Depression, the worst economic crisis in U.S. history.

The Federal Reserve was created in 1913 and the United States stayed on the gold standard until 1973. In 1933, President Roosevelt made it illegal for Americans to own gold and required them to sell their gold to the Federal Reserve at a price set by the government, but technically the dollar was still linked to gold. Roosevelt’s executive order remained in effect until the 1960s and 1970s when it was repealed piecemeal.

In the past, linking the value of the dollar to the value of gold did not prevent the boom and bust cycle. A federal gold standard did not prevent the government from manipulating the value of the dollar. Why does Paul believe that a new gold standard would be any different? Further, U.S. production of gold is declining. Would a gold standard remove the influence of unelected bureaucrats at the Federal Reserve only to replace it with a dependency on gold miners, bankers, and bureaucrats in countries like China and Russia for economic growth?

A third question involves Paul’s assertions that the wars in Afghanistan and Iraq were illegal. The Constitution gives Congress the power to declare war (Article I Section 8), but stops short of requiring a declaration of war. The same section gives Congress the power to “define and punish… offences against the law of nations,” arguably the power to intervene on behalf of victims of crimes against humanity, and to “provide for the common defense,” a general term that could be construed to include pre-emptive war against a hostile nation believed to be developing WMDs.

As Max Boot notes in his book, “The Savage Wars of Peace,” declared wars have been the exception rather than the rule in American history. One of the first undeclared wars occurred during the administration of none other than Thomas Jefferson against the Barbary pirates. This conflict is memorialized in the line of the Marine hymn that references the “shores of Tripoli.”

In the 20^th century, U.S. forces, almost always the Marines, essentially invaded and governed several Central American and Caribbean nations. For almost 20 years prior to WWII, the Marines ruled Haiti. Long undeclared interventions also occurred in Mexico, the Dominican Republic, and Nicaragua, not to mention Panama. After the U.S.S Greer, an American destroyer, was fired upon by a German U-boat, President Roosevelt essentially launched an undeclared war against the Germans in the Atlantic more than a year before the attack on Pearl Harbor.

While the wars in Iraq and Afghanistan did not begin with a formal declaration of war, President Bush did seek and receive the approval of Congress (President Obama’s intervention in Libya is another matter). How can Paul really consider the wars in Iraq and Afghanistan illegal when both interventions were approved by Congress with Paul himself having voted to approve military action in Afghanistan?

Finally, why does Ron Paul oppose the National Defense Authorization Act (NDAA)? Did Paul not read Section 1021 paragraph (e) which reads “Nothing in this section shall be construed to affect existing law or authorities relating to the detention of United States citizens, lawful resident aliens of the United States, or any other persons who are captured or arrested in the United States?” Similarly, Section 1022 paragraph (b) (1) says, “The requirement to detain a person in military custody under this section does not extend to citizens of the United States.”

Since the law plainly does not allow the indefinite detention of Americans but Paul opposes it anyway, does this mean that Paul opposes indefinite detention of foreign terrorists captured abroad? These are the people who the law allows the military to detain indefinitely. There are Americans who believe that these foreign-born, foreign-captured, non-U.S. citizens should be entitled to a day in American courts. Is Paul among this group?

If Paul thinks that foreign terrorists should have habeas corpus rights and access to U.S. courts, it would be the first time that prisoners of war (actually unlawful combatants under the Geneva Conventions) captured in combat outside the country have been granted access to the judicial system. Even German POWs housed in prison camps within the United States itself during WWII were not accorded constitutional rights due to American citizens. No one would have dreamed of allowing captured Nazis to challenge their detention in American courts.

Hopefully, Rep. Paul or his supporters will answer these questions and help to clear up some of the apparent inconsistencies in Ron Paul’s political platform.

This article was originally published on Examiner.com:

http://www.examiner.com/conservative-in-atlanta/questions-for-ron-paul

Why Ron Paul can’t win

Ron Paul is a frequent winner of straw polls and has a loyal following among libertarians. In spite of winning these polls, Paul has no chance of winning the Republican nomination. This is not because of a Republican or media (or Bilderberger or Illuminati or any other) conspiracy. The reason lies in Paul’s political beliefs and the nature of the straw polls that he wins.

Paul, a Republican congressman representing a Texas house district, is not a normal Republican. Between terms in Congress as a Republican, he ran for president as a Libertarian Party candidate. Even today, his platform is starkly different than those of other Republicans.

One of the issues where this is most apparent is drug legalization. Ron Paul has supported the decriminalization of narcotics and an end to the drug war. While the American public is almost evenly split on the issue of marijuana legalization according to an October 2011 Gallup poll, only 35 percent of Republicans are in favor. The fact that Paul is out of step with Republican voters hurts him as a candidate in a Republican primary.

While Paul opposes attempts to redefine traditional marriage, he opposes a federal marriage amendment, which is the only way to prevent the courts from imposing same-sex marriage. As with drug legalization, this is an issue on which the American public is divided according to a recent Associated Press poll, but support for traditional marriage is stronger among Republicans and conservatives. When voters have had a chance to vote on definition of marriage laws or amendments, they often pass by a large margin. Georgia voters approved a marriage amendment with 76 percent in favor in 2004.

On other issues Paul is similarly out of step. After U.S. Navy SEALs killed Osama bin Laden in Pakistan, Paul said in an interview on Iowa’s WHO radio that he would not have ordered the raid. As reported by ABC News, Paul said that the raid was “absolutely not necessary” and did not reflect “respect for the rule of law and world law, international law.” Paul said that he would have favored cooperation with Pakistan to arrest bin Laden.

Paul’s position again conflicted with the beliefs of most Americans. According to a Washington Post/Pew poll, by a margin of 34-8 percent most Americans believed that Pakistan had done more to hurt U.S. efforts to find bin Laden than to help. Seventy-two percent of Americans felt relieved that bin Laden was dead. Bin Laden’s death made 60 percent of Americans feel proud and 58 percent felt happy. These percentages are probably even higher among Republicans.

Even more current and troubling to most Americans is Paul’s position on Iran. CNS News reports that Paul said, “For them [Iran] to be a threat to us or to anybody in the region, I think it’s just blown out of proportion.” Paul opposes sanctions or military action against Iran and says that the U.S. should offer friendship instead, a position closer to that of Barack Obama than his fellow Republicans.

In contrast, a UPI poll released on November 12 shows that 50 percent of Americans support U.S. military action against Iran and 57 percent support an Israeli attack on Iran. According to a CBS/Global Research poll, only 17 percent of Americans do not believe that Iran poses a threat.

As the polls were released, the International Atomic Energy Agency released a report that confirms that the Iranian nuclear program is focused on developing weapons rather than nuclear power for peaceful purposes. Coming on the heels of the FBI’s disruption of an Iranian assassination plot in Washington, D.C. in October, it is likely that many more Americans are coming to see Iran as a dangerous threat that will not respond to anything short of military action.

On the other hand, Paul’s long-time advocacy of government spending cuts is now being supported by a majority of Americans according to Gallup and there are signs that his desire to bring back the gold standard is gaining support as well. A Rasmussen poll from October surprisingly showed that 44 percent of Americans favored the gold standard compared to 28 percent opposed. When the question was phrased to say that the gold standard would reduce the powers of “bankers and the political class,” support increased to 57 percent and opposition dropped to 19 percent.

Rep. Paul’s call to “end the Fed” may be gaining support, but is still a minority position. A Bloomberg poll from December 2010 showed that only 16 percent wanted to abolish the Federal Reserve. That number was twice the eight percent who favored abolishing the Fed in October of that year. Even if most Americans don’t favor shutting down the Federal Reserve, 39 percent did want to make it more accountable and only 37 percent favored the current model with an independent Fed.

Ron Paul’s economic policies are finding favor in the current climate of massive government spending and deficits. On domestic issues and foreign policy, however, he is out of step with most Americans and even more out-of-step with Republicans, whom he must win over to reach the general election. Consequently, he stays below ten percent according to the Real Clear Politics average of polls, even as he wins unscientific straw polls where his supporters turn out in droves. In Georgia polls, Paul remains similarly in the single digits, near his under-three percent finish in Georgia’s 2008 primary election.

Read this article on Examiner.com:

http://www.examiner.com/elections-2012-in-atlanta/why-ron-paul-can-t-win

Gas prices, Obamanomics, and the return of inflation

Drivers around Atlanta have undoubtedly noticed rising gas prices over the past few weeks.  Georgiagasprices.com reports that the average price of regular unleaded gasoline in Georgia is $3.428, just below the national average of $3.487.  Georgia’s average price has risen 42 cents per gallon in the past month and 78 cents in the past year.  This is an even sharper increase than the national average which is up 36 cents in the past month and 74 cents in the past year.

Part of the reason for the increase in gasoline prices is undoubtedly the unrest in the Middle East.  Whenever there is political instability in oil-producing regions of the world, which is fairly often, the price of oil tends to rise.  This, in turn, causes the price of gasoline and other items made from oil to rise.  The problem is compounded by the Obama Administration’s attempts to stop new domestic oil exploration and the EPA’s new carbon regulations. 

The rising price of oil may both mask and contribute to something more insidious as well:  a return of inflation.  Rampant inflation and resulting stagnant economic growth characterized the entire decade of the 1970s.  The inflation of the 1970s was caused by many of the same factors that are present in our economy today.  President Nixon ran up federal deficits and imposed wage and price controls.  Along with Federal Reserve Chairman Arthur Brooks, Nixon also increased the money supply sharply in an effort to end a recession and reduce unemployment.  Further, oil prices spiked twice in the 1970s as well; first, in 1973 with the Arab Oil Embargo and again in 1978 with the Iranian Revolution.

These factors are mirrored today in President Obama’s economic policies.  The federal deficits under Obama have led to an increase in the federal debt of $3.5 trillion.  Obama has also launched controls in some areas of the economy.  The president capped the pay of Wall St. CEOs of companies receiving federal bailouts.  He has also openly considered the idea of price controls as a remedy for health insurance costs that are rising even more sharply in the wake of the passage of Obamacare.  Federal Reserve Chairman Ben Bernanke is currently increasing the money supply by printing money under the guise of “quantitative easing.”

It is axiomatic in economics that as supply increases, price decreases.  Therefore, we can predict that as the supply of dollars increases through quantitative easing, increasing the money supply, that the price (or value) of those dollars will decrease.  Essentially this means that as the government prints more dollars, each individual dollar is worth less. 

Already, the specter of inflation is rearing its head in world markets.  One of the most notable areas of price increases is in world food markets, where food prices are at the highest point since the UN started tracking them in 1990.  Ironically, the rising cost of food in poor Arab countries may have been partly to blame for the outbreak of revolts against Middle Eastern dictators.  The unrest then further drives up oil prices, which leads to more inflation. 

President Obama with Fed Chairman Ben Bernanke

Bad weather and crop failures around the world have contributed to rising food costs, but economists believe that government mandates to use more food for ethanol production instead of consumption also play a major role in rising food costs.  Economics teaches that when something becomes more scarce, as when food is diverted to manufacture ethanol, it becomes more expensive. 

At the same time, ethanol remains uncompetitive in spite of government subsidies.  A plant in Soperton, Ga. that produced ethanol from wood recently shut down in spite of receiving over $150 million in government loan guarantees and grants, while a corn ethanol plant in Camilla, Ga. is in bankruptcy.  Ethanol subsidies and mandates are detrimental in that they add to the federal deficit while also driving up world food prices.

The Consumer Price Index (CPI), which measures inflation, has been relatively steady.  The CPI, however, does not typically include food and energy.  When food and energy prices are included, the CPI shows a sharp uptick in recent months. 

A further indication of the onset of inflation is the rising price of gold and silver.  Precious metals, gold in particular, are often considered a hedge against uncertainty and inflation.  After falling with the economy in 2008, the price of gold has rebounded sharply.  Since President Obama took office in 2009, the price of gold has risen from less than $900 per ounce to $1,467, an increase of more than 60%.  Silver has reacted even more dramatically, rising from just over $9 per ounce to $35, an increase of almost 300%.

Many economists do believe that monetary policy is the sole cause of inflation and that rising oil prices are a symptom of inflation, rather than being one of its causes.  In this case, rising oil prices are still bad news for the U.S. and world economies.  There is a strong link between spikes in oil prices and recessions.  The typical pattern is that oil prices increase dramatically, at least partially causing the recession.  As the economy slows, demand for oil decreases, which leads to a decline in the price.  This often allows the economy to rebound. 

This is the pattern followed in 2008 when record high gas prices were experienced just prior to the financial collapse.  After the onset of the recession, oil and gas prices dropped dramatically.  The Obama Administration’s regulatory and financial policies postponed the recovery and kept oil prices low until recently.  As the economy slowly recovers, oil prices would normally start to creep upward again.  The unrest in the Middle East provided more upward pressure as well.

Algerians riot over high food prices in 2009 (Flickr: 110109 Algeria slashes food prices amid riots)

In the current economic climate, the Federal Reserve is dramatically increasing the money supply.  At the same time, political unrest in the Middle East and Obama Administration policies at home are driving up the cost of oil and energy.  Problems with crops and diverting agricultural resources to ethanol production are increasing the cost of food as well.  If these trends continue, Georgians can expect gas prices to continue to rise, along with the prices of milk, bread, meat and other foods.  Eventually, if left unchecked, inflation will spread to other areas of the economy as well.

The cure for runaway inflation is almost as bad as the disease.  The rampant inflation of the 1970s was defeated only by the strategy of Ronald Reagan and Federal Reserve Chairman Paul Volcker to tighten the money supply (by increasing reserves of central banks and reducing the supply of money in the economy).  This strategy led directly to the recession of 1980, but ultimately inflation was defeated and the economy entered a strong recovery.  Other policies that President Obama is unlikely to embrace, such as tax cuts and reducing regulation, helped to ease the transition to tighter monetary policies.

http://www.examiner.com/conservative-in-atlanta/gas-prices-obamanomics-and-the-return-of-inflation#ixzz1G2Dv4hbc">