by Jeff Poor

Scary times ahead? Perhaps, if you take credence in what Rep. Ron Paul, R-Texas, says.

Paul, who had a strong grassroots following during the 2008 presidential election, explained on Glenn Beck’s Sept. 30 radio program that perilous times lie ahead due to the Federal Reserve’s loose monetary policy. Host Glenn Beck asked how an Israeli strike against Iran might trigger problems with the American financial system

“What happens when Israel strikes Iran or Iran has the earth rays and we know that they now have a nuclear weapon, what happens to our financial system at that point?” Beck asked.

The libertarian Paul maintained China would become the world’s financial heavyweight and they were already making preparations to be the world’s top dog.

“I think the Chinese take over,” Paul said. “If there’s a real panic and oil shoots up to a couple of hundred bucks, the Chinese will dump their dollars. Chinese are maneuvering for this. The more we threaten Iran, the stronger the Chinese influence gets because they’re using the dollars that they have earned from us and saved, they have a trillion, and they are starting to buy up assets in Iran and build plants and get involved in their energy. So the whole thing is backfiring on us. We’re getting ready to put tougher sanctions on the Iranians and that will make things that much worse. It won’t help the dissidents in Iran. It’s going to cost us a lot of money, and there will be a bombing and that will be a big, big event. I think it will crash the dollar is what I think it would do.”

And what does the country look like after the dollar crashes?  Not good the Texascongressman said.

“We think it was bad with the financial crisis,” Paul said. “When you have a dollar crisis, the whole thing quits functioning. The checks bounce and literally the federal government’s checks bounce if you have – if inflation goes up.”

But the situation deteriorates even more Paul – with states leaving the union.

“I think we’re going to have a de facto 10th Amendment, secession,” Paul said “People are just going to ignore the federal government because they won’t – and there’s, you know, a total loss of credibility.”

Beck alluded to media charges and warnings from others that there would be violence and contended the right is being set up to take the fall for it.

“Congressman Paul, the media and even [Rep.] Patrick Kennedy said this, we heard this from two people, Muammar Gaddafi and I believe the other one was Ahmadinejad that both spoke last week and they – we’re hearing it all the time that there’s going to be violence here in America, that people are targeting,” Beck said. “Basically everyone is going to blame this on the right, any kind of violence.”

There would be violence, but not before a dollar crisis happens as some Democratic politicians and media personalities have warned, but afterward Paul said.

“I think that there will be violence,” he explained. “I hope we don’t have to go through, you know, a very violent period of time, but that’s what happens too often when the government runs out of money and runs out of wealth, the people argue over, you know, a shrinking pie and, of course, the people who have to produce are sick and tired of producing.”

Joel Skousen will be my guest on the show, today at noon, MST.

Here’s a short video recording of one of Joel’s talks from the last campaign season:

http://www.viddler.com/explore/AwakeAndAriseOr/videos/11/

The letter which I read on the air yesterday, sent to some listeners in Provo, Utah from Senator Orrin Hatch, has raised some questions and resulted in several emails.  I was hesitant to send out the original letter because of the receiver’s names and address being prominently attached to that letter, posing potential privacy problems.  The letter I have is a scan of the original, in PDF format.

In order to placate those who are inquiring, however, I gave the letter to Aaron Turpen to see if he could extract it and/or remove the names.  He’s done both.  Below, I’m pasting in the text of the letter (sans greetings and salutations), as well as a scan of the document with complete headers and so forth included.

Thanks for listening!  Here’s the letter text:

Thank you for writing to express your support for legislation that would abolish or regulate the Federal Reserve Board, essentially removing Federal regulation of banking and returning the nation to the “gold standard.” I appreciate hearing from you.

There have been a number of bills introduced in both the Senate and House addressing the Federal Reserve.

You may be interested in the Federal Reserve Transparency Act (H.R. 1207, S. 604). H.R. 1207 was introduced in the House of Representatives by Rep. Ron Paul on February 26, 2009. Rep. Paul has long been a vocal critic of the Fed and has supported its abolition for some time. H.R. 1207 and S. 604 would amend title 31 of the United States Code, to reform the manner in which the Board of Governors of the Federal Reserve System is audited by the Comptroller General of the United States and the manner in which such audits are reported.

A Senate bill, S 513 was introduced by Senator Bernie Sanders on March 3, 2009. S. 513 would direct the Board of Governors of the Federal Reserve System to publish on its website, with respect to all loans and other financial assistance it has provided since March 24, 2008.

All the Senate bills have been referred to the Senate Committee on Banking, Housing, and Urban Affairs where they are pending. The House bills are pending in the House Committee on Financial Services.

Since the Federal Reserve Act was signed into law in 1913, the Federal government has had a role in ensuring the integrity of our country’s financial system in order to protect American investors and consumers against such problems as bank failure. The Federal Reserve System is a mixture of public and private entities. The Federal Reserve Board has been granted the authority by Congress to set monetary policy and to regulate commercial banking activities. While the Federal Reserve System was established as an independent agency, the President of the United States appoints the seven members of the board with the appointments subject to confirmation by the Senate. Congress also has the power to modify the Federal Reserve System.

The system also receives extensive feedback from representatives of the public through frequent meetings with members of the Executive Branch and appearances before congressional committees.

While many people have questioned the constitutionality of the Federal Reserve System based upon provisions in the Constitution which give Congress power to “coin money and to regulate the value thereof,” the Congress has appropriately assigned these authorities to government agencies. For example, the Internal Revenue Service (IRS) has been given authority to collect taxes. Similarly, the Federal Reserve System has been delegated the authority to establish monetary policy.

The Federal Reserve System is responsive to the needs of the economy, especially the stock market. Compared with virtually all foreign central banks, the Federal Reserve System appears to be very forthcoming in disclosing policies and open to receiving suggestions. Therefore, I am hesitant to support proposals to further erode the independence of the Federal Reserve System or to intrude on the setting of monetary policy. Over the last 25 years, the level of inflation has been quite stable and low, even compared to the period before we created the Federal Reserve.

Rest assured that I will keep your comments in mind should this legislation be taken up by the full Senate.

Again, thank you for writing.

And a scan of the document:

Great interview of Rep. Ron Paul (R-TX) regarding proposed regulations by the Obama administration.  The usual candid, clear view from Paul clears up the market misconceptions inherent in the Obama plan.

A great video about production, taxation, and socialistic thinking. The film was made by several students of one of the world’s greatest economic thinkers, Rothbard. He is the inspiration behind Ludwig von Mises and Dr. Ron Paul, to name just a couple of great libertarian economic thinkers.