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Video: Ron Paul vs. Bernanke (for the Last Time)

Written by Gary North on July 19, 2012

Ron Paul will retire at the end of this term. This encounter with Bernanke was his last chance to deal with Bernanke, and Bernanke with him. Paul is Bernanke’s most tenacious critic in the government.

The video has a nice introduction by the chairman of the committee. Then, around 1:30 into the video, Paul begins.

He reviews his first months in Congress, beginning in April of 1976. He notes that the #1 bill at the time was the bill to add more U.S. money to the International Monetary Fund. The Bretton Woods law of 1944, which had created the IMF, had broken down, 1971-76. He notes that this breakdown had been predicted in 1944 by free market critics.

I arrived in Washington as his staff economist in early June: from Washington State to Washington, D.C. I wrote his position paper calling for America’s de-funding of the IMF. My first day on the job was Friday, June 11. I had to have the dissenting opinion finished by Monday morning’s deadline for submission. I started it on Friday and came in on Saturday to finish it. I was the only person in the office. His was the only critique of the IMF funding bill on Capitol Hill.

He does not mention it, but he was soon called to testify before the Senate Banking Committee, chaired by Senator William Proxmire. So amazed was Proxmire that anyone in Washington would oppose this bipartisan bill that he wanted to hear Paul’s reasons for opposing it. At the time, I had never heard of a House member testifying to a Senate Committee. I have never heard of it since.

In the video, he goes on to make the point that the same critics who predicted that the IMF would fail also predicted that the post-1976 monetary order would also fail. He really meant “critics from the same position: Austrian School economics.” (The literal critics in 1944 have been dead for decades.) The pure fiat money system has failed, Paul says. He is right. We are in the early stages of that failure.

He makes it clear that he has always opposed the Federal Reserve System, not merely the chairmen of the Board of Governors, from Volcker to today. It is the system, based on fiat money, that has been his target.

Beginning in 1976, he has been the only person on Capitol Hill to oppose the FED as a system, as distinguished from critics of this or that FED policy.

If you want to know where true power resides, find a nation’s untouchable institution. In every Western nation, this is the same institution: the central bank.

The FED is untouchable: in politics, in the media, and especially in the economics textbooks. There is no other federal government institution equally untouchable and equally powerful. It is beyond politics — independent. The 12 Federal Reserve Banks are privately owned. Yet the FED is universally praised by intellectuals and economists for this independence. The Board of Governors is legally part of the U.S. government, but Congress never tells the FED what to do, or even audits it, especially its supposed holdings of the nation’s gold. No other government institution enjoys such immunity and such praise for this immunity.

The FED gave us the Great Depression in the 1930s, yet it has remained untouchable. It will give us more disasters.

Here is the video.

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13 thoughts on “Video: Ron Paul vs. Bernanke (for the Last Time)

  1. Americans today, now have their backs to the wall, WE THE PEOPLE, need a change from the atypical two party paradigm that has besieged Washington since the inception of The Federal Reserve System, in 1913. Clearly, Ron Paul should have been the Next President.

    Simply and honestly,

    Dr. Paul is simply reminding us of our God given rights that we were born with as Human Beings, hence thereby requiring from our virtues within each of our souls, prudent clarity, and focus in our logic, by:

    •REDUCE the size of over bloated government,,
    •ADDRESS the rancid pork barrel infestation of lobbying for political favors within the beltway, an over 5 billion dollar a year activity.
    •ADDRESS our global military presence (and the exorbitant billions of spending that go with it),
    •The constitutional redressing of States rights.
    •RETURN of the gold and silver backed dollar.
    •ELIMINATE worthless printing of the present inflated fiat Federal Reserve Currency.
    •END the illegal presence of the neither Federal , which there are no reserves, because they print currency out of thin air then bill the taxpayer for it, to END THE FEDERAL RESERVE BANK !!!
    •CUT $1 trillion in federal spending his first year in office.
    •ELIMINATE five federal departments and return power to the states;
    •BALANCE our out-of-control budget in only three years.
    •FIGHT gun grabbers, Big Labor, and the reckless spenders at the Federal Reserve each time they try to ram through another power grab.
    •MAINTAIN a fighting force that is second-to-none while refusing to surrender our national sovereignty to carry out the UN's decrees.

    If Ron Paul were elected, he would have been the moral authority and the mandate to have a zero rate tax rate, which would bring in an influx back to America, of prosperity, un be known to any economy, in essence, the complete opposite of what we have now.

    Remember now, for 140 years before 1913, America did exactly that. Wake up people.

  2. Rabelrouser says:

    I would say that 99.8% of the American Public have no clue as to the problems the Federal Reserve and its economic polocies have caused this nation, and most of the time, I truly believe they just dont want to know. Call it Constitutional Ignorance, political blindness, or just plain uneducated ability to conclude or to even attempt to delve into the subject.
    Maybe its just too deep for them. Maybe they still believe that everything will be better with the next vote, rather simplistic thinking if you ask me; more so totally devoid of the ability to think for themselves.
    Maybe they can be distracted too easily and can not concentrate on a subject for too long.
    What ever the reason, untill they begin to educate themselves to this devistating proble, NOTHING in this nation will ever be solved
    I, with a high school education was able to read and educate myself about this fraudelent system and have been trying to educate others ever sence the late 80's, but few are ever interested. That is why, in the next few years, if that long, America WILL economically collapse, and the suffering will begin, I will bet everything I have on it.

  3. If the average American were to attempt to follow what's going on and the issues involved in economic policy, it would require him to actually think. That's work. Who wants to do that.

  4. Texas Chris says:

    There is one agency that is more powerful and less accountable than the Fed. It has never had a true audit. It's income stream is outside the tax-and-print system. Its activities are a state secret not even allowed to be printed, and never entered on any computer. It dictates the US's foreign policy unilaterally, and influences the US's domestic policy clandesinely. Its employees are anonymous, feared, and yet hailed as heroes.

    Welcome to CIA. The real government of the US. Every president since Reagan has been a former (if that's possible) employee of CIA.

  5. […] google_color_bg = ""; google_color_text = ""; google_color_url = ""; google_ui_features = "rc:0"; teapartyeconomist.com / By Gary North / July 19, 2012Ron Paul will retire at the end of this term. This encounter with […]

  6. Dr.Ron Paul 2012 America's Very Last Chance !!!

  7. GOD BLESS RON PAUL—A GOOD MAN AMONG TRAITORS….GOD BLESS AMERICA & MITT ROMNEY….
    GOD WILL BE TAKING HIS VENGANCE ON THE EVIL=======GREED==============& CORRUPTION IN THE U.S.A.

    THEN WE WILL SEE JUSTICE…..AMEN !!!!!!!!!!!

  8. Independant says:

    I and maybe a million others agree with you 100%, however, something happens when people go to the Voting Booth. Maybe it's 2 million idiots that out number our votes, most of whom are probably the votes of dead and illegal voters. Great comment Joe!

  9. I find it totally embarrassing as an America that we have idiocy as an established monetary policy, not only the low character and estate of liberals and neo-con's that continue this. Paul's comment "if spending and debt are the problem, then why is the answer always more spending and debt?" is completely lost on men that have vain imaginations, they honestly think that that statement is foolishness or worse and it's really something we should be ashamed of for allowing men of ill repute to sit in the highest offices of public trust in our general government. They aren't just unsound in their ideas they are unsound ethically and morally which is the root of the unsound ideas, they are just realizing their darkened hearts by creating a systematic formula for legalized plunder. It is also amazing, as Paul noted, that no one has a definition for the dollar – our Constitution does as the term is used twice therein, it is a unit of weight of standard silver equally 416 grains equivalent to the Spanish Milled Dollar of the founding era and its predecessors going back to 1517 and the German Reformation. Congress cannot lawfully change that as the Constitution is the source of all of their authority, if they redefine the words they've amended the Constitution through fiat means. And that root is the basis of the Federal Reserve – fiat law requires fiat money and the economic coercion they are able to create is the means of enforcing a tyranny by capturing the heart of men in the perpetual servitude of debt.

  10. Idylewylde says:

    Fiat money is Corporate Fascism.
    The real wealth is not currency. The real wealth is material assets, like land ownership.
    By playing inflation games, they destroy our means to own anything .. then they tax us off our land.
    The banks that create the crisis get bailed out with our tax dollars.
    The bailed out banks buy up the failed assets .. our homes, our properties, our lives.
    After the monetary 'crisis' is over, a small group of people own everything.
    If you want to change this crimninal enterprise we call the FED .. it's real simple: AUDIT THE FED.
    After that, the lynch mobs will take care of the political scumbags who did this to us.

  11. I do not care for Rep Dr Paul's foreign policy but do not think there would be anyone better than he to run the Treasury Department if Romney is elected. Rep Dr Paul knows the Fed and economics better than just about anyone out there and he could help Romney straighten this country. And I, on SS and VA disability would and should lose part of what I get from the gov't. Many of us receiving entitlements would somehow manage to get by on less than we now receive. We all need to majorly tighten our belts or those coming after us will suffer terribly for our own greed, and willingness to let the government do the work charity and families should be doing for those of us disabled or for whatever reason unable to work. I was injured severely while serving in the military during Vietnam but I know although it would be difficult to get by with less, we are all going to have to either get by with less or get by with nothing at all from the government. If we give up some now, those injured recently in Iraq and Afghanistan might get the care they need and those in future wars might get care. If no one gives up anything willingly, all will give up unwillingly. It cannot go on like it has been, the government is broke.

  12. The problem isn't just in the voting booth. It's between voting rounds. To have a government *by* the people, you need modern tools to supervise the government that ordinary people can use and do not take too much time.

    Consider how much time it is reasonable to expect a non-professional to devote to government oversight. Make it a number of hours per week on average. Remember that number because you're going to need it two paragraphs down.

    Now count up all the governments you personally are supposed to keep an eye on. There is your municipal government, your school district, in many areas there are also "special" districts like fire, water, sewer, waste, redevelopment (TIF) as well. Then in most of the country there is a county government, the state, and finally the federal government. In some areas, you can have multiple layers of local government. In NY, where I grew up, I lived in a village that was within a town within a county, etc. and where I live now in Indiana, I live in a town inside a township. So you can have as little as three and as many as a dozen or so of these entitites.

    Now look back at the time you thought was reasonable before you toted up all those governments. Judge whether the number of governments to oversee can reasonably be done within the time limits you yourself set. Do ordinary people have the tools needed for the job? If not, we have ceased to have a government that is by the people.

    The kicker is that these tools already exist in embryonic form. They are used every day by major corporations. The class of tools is called business intelligence.

    The basic features needed to extend their use into the political realm has been under development by the Internet people in their "semantic web" project since the late 1990s. It's just that nobody's stuck all the pieces together.

    Nobody has gone out and educated people that we have to insist that governmental legitimacy depends on enrolling the business of government into information structures that our computers can automatically retrieve, run analytical rules on, and be used by ordinary people to properly judge whether the government is doing its job correctly. There are zero major popular factions on the left or the right who would be against it. The insiders, now that's a different story.

    Any government that does not enroll in such a system is trying to evade the oversight of the people by making oversight too complex for the people to actually do it. That government is illegitimate and its current leadership needs to be thrown out and replaced with one who will do it.

    Don't kid yourself. This is not a quick fix. It is, however, a durable fix. I think that it would lead to the pruning of an awful lot of government over time.

  13. It actually requires work because the source documents are somewhat difficult to find and the rulesets needed to do the analysis are not entirely obvious to your average public high school graduate. There's a bit too much math. That means that you need to have tool development to make it understandable.