Ron Paul on Accountability and Fiat Money

The FCIC: Passing the Buck

...the federal government’s Financial Crisis Inquiry Commission held hearings as part of their continuing investigation into the causes of the acute economic meltdown which occurred in late summer 2008. 

...The individuals questioned by the commission mostly seem to be diverting blame for the whole fiasco to someone else.

...The reality is that the Federal Reserve relentlessly expanded the money supply through artificially low interest rates for over two decades, and this expansion of easy money caused a wholly predictable bubble.  To a myopic Keynesian regulator, the bubble may appear to be caused by greed, but in truth it is completely predictable that humans will act in their own perceived self interest. 

...We can condemn this as greed, but the fundamental problem is Fed policy itself.  There will always be demand for cheap money, but we should not allow the Fed to debase our currency and create bubbles of false prosperity to satisfy that demand.

What the commission really needs are experts who understand free market economics rather than big government Keynesian fantasies.  The commission has none of these, and has called no true free market witnesses.  That perspective would only distract from their predetermined goals.

The commission will bemoan the complexity and inscrutability of our economic problems, but the solution is simple: allow freedom to operate in our markets.  Allow U.S. financial, labor, and housing markets to normalize without political interference. 

Though solution is simple...,It would require admitting fiat money is a tangled web of monetary deception prone to catastrophic failure.  It would require allowing Americans to choose a system of sound money, where the money supply and interest rates are set by market forces rather than centralized economic planners. 

Unfortunately, fiat money is like a drug to a Congress hopelessly addicted to spending vastly more than the Treasury collects in revenues.  Because of this, our problems can only get worse and more complex before they get better.

Congressman Ron Paul