With the recession hanging on, the dollar losing standing around the world, unemployment remaining high and commodity prices continuing to soar, the persistent nagging of Congressman Ron Paul seem prophetic. I searched back and found what he was preaching exactly three years ago before the economic meltdown and it seemed appropriate to dust them off for another look.
America became the greatest, most prosperous nation in history through low taxes, constitutionally limited government, personal freedom and a belief in sound money. I decided to run for president because I am deeply concerned that the conservative movement has drifted away from these principles that we once so fiercely defended. Deficits have exploded, entitlements are out of control and our personal liberties are threatened like never before.
The current state of our economy drives home the hard truth that living beyond our means has caught up to us. Oil is over $100 a barrel, the housing market is in sharp decline and the dollar is in a free fall.
The national debt now stands in excess of $9 trillion, more than $30,000 per person. The total future debt obligations of the United States, including entitlements, are estimated at around $59 trillion, which equates to over $500,000 per household. Social Security and Medicare will likely consume the entire federal budget by 2040, threatening the average American with an impossible tax burden.
As I said this past November to Federal Reserve Chairman Ben Bernanke, "We're indeed between a rock and a hard place, and we don't talk about how we got here; we talk about how we are going to patch it up." The "solutions" proposed so far--stimulus packages, bailouts and interest rate cuts--just amount to printing more money, which will lead to greater currency devaluation, contribute to the rising costs of living, and further squeeze the middle class and our senior citizens.
This is the first time in over 100 years that monetary policy is being discussed in earnest during a presidential campaign. Money is the lifeblood of any economy, and control over a nation's currency means control over its economic well-being. Fed bankers quite literally determine the value of our money by controlling the supply of dollars and establishing interest rates. Their actions can make you richer or poorer overnight, in terms of the value of your savings and the buying power of your paycheck. For over 30 years, I have been urging all Americans to educate themselves about monetary policy in order to better understand how a small group of unelected individuals at the Fed and the Treasury Department wield tremendous power over our lives.
In order to immediately strengthen the economy and lay the groundwork for continued prosperity, I have proposed a four-part plan that involves lower taxes, less spending, a sound monetary policy and regulatory reform.
We can take several immediate steps to reform our archaic tax system and give Americans back the fruits of their labor. I will work to make the Bush tax cuts permanent, including a repeal of the estate tax, and I will fight to end taxes on Social Security benefits and income derived from tips. I also believe that if we are to truly address the housing crisis, we will end taxes on forgiven mortgage debt, which is considered "income."
The most permanent tax reform we can undertake, though, is to end the income tax and abolish the IRS. We could remove the entire personal income tax-funded portion of the budget and the federal government would still receive roughly the same revenues that it did during the Clinton years. And we could do this without even touching Social Security and Medicare.
The key to tax reform lies in spending reform. It's time to cut back on our trillion-dollar overseas budget and use that money to secure the programs Washington has forced so many citizens to depend on. By doing this, we can let younger generations opt out of these programs and save for their own retirements and health care needs. As president, I will also veto any unbalanced budget and demand that Congress address wasteful spending.
Lower taxes and less government spending will put more money in your pocket. A sound monetary policy will increase the value of that money and drive down the costs of living.
Immediate monetary reform can be achieved by requiring transparency at the Fed. All Federal Reserve meetings should be televised just like the proceedings of Congress, and they should once again make all information on the money supply available. I also favor legalizing competing currencies. History is replete with examples of the inevitable failure of paper money systems, from our own founding days, to inter-war Germany, to the monetary crisis of 1970s Latin America.
However, I believe that for our economy to be secure in the long term, Congress must reassert its authority and end the unconstitutional Federal Reserve.
Finally, we must be willing to undertake regulatory reform. It would serve us well to revisit the myriad federal regulations that have stymied the innovative spirit of the American people.
One of the most damaging regulations imposed on the American people is the Sarbanes-Oxley Act. A survey by Financial Executives International put the average cost of compliance with Sarbanes-Oxley at $4.4 million, while the American Economics Association estimates the Act could cost American companies as much as $35 billion. A study by the prestigious Wharton Business School found that the number of American companies delisting from public stock exchanges nearly tripled the year after Sarbanes-Oxley became law. One of the best things Congress could do for the American economy is to repeal this damaging legislation.
According to David Walker, former head of the U.S. Government Accountability Office, "We are mortgaging the future of our children and grandchildren at record rates, and that is not only an issue of fiscal irresponsibility, it's an issue of immorality."
Unless we embrace fundamental reforms, we will be caught in a financial storm that will humble this great country as no foreign enemy ever could. However, we can find safe harbor in our ideals. Reclaiming our historic legacy of principled commitment to liberty will, once again, unleash the innovative spirit that propelled our nation to heights of prosperity never before achieved in human history.
Friday, March 18, 2011
20110301 Biofuel Eats the Poor
Doing what is right is not always easy. I am not talking about any moral debates over the good of the many outweighing the good of the one and it does not matter whether the argument is attributed to John Stewart Mill or to Mister Spock. Sometimes it is just hard to know what is right.
One quick example of this is the compact fluorescent light bulb. We all know that we are supposed to use them because they are good for the environment. There are commercials that play quite often. I do not know what they are advertising but there is a happy smiling woman who tells us that doing something simple like changing a light bulb gives us a feeling of empowerment over our lives. I changed my own light bulbs over to the fluorescent kind four years ago. The problem is – when these bulbs die and we throw them away, they are full of toxic mercury. Suddenly they are very bad for the environment.
A bigger and more pressing issue is ethanol. It is a popularly accepted belief that ethanol is good for the environment. I believe that it is true that corn burns cleaner than oil. However, corn burns a lot less efficiently than oil. You use more ethanol fuel to go somewhere than you do oil. It also takes much more energy to turn corn into fuel than it does to turn oil into fuel. Ethanol is also corrosive. Fuel made from oil can be pumped through a pipeline. Ethanol would eat through the pipeline so it needs to be trucked to where it’s going. To burn a gallon of ethanol turns out more pollution than a gallon of oil based fuel.
This is not to say that there is no place for ethanol within the whole. Even with all of the new oil being pumped out of the ground, it is not going to be here forever. I remember the predictions that it would be gone by 1990. While that was wrong, it is true that is a finite resource that everyone wants and this takes power and control away from us (the users) and gives it to people who have radically different feelings about life and death (the producers). We need to find better ways to make ethanol and better ways to use it.
The biggest problem with ethanol is that it reduces the food supply. I have to give credit to Fidel Castro, he had this right. Because the industrialized world is concerned with how much we need to spend to fill our gas tanks, food is being removed from the third world. A sizable chunk of the world population spends seventy-five percent or more of their assets on food. Any increase in food prices is devastating to them. We are beginning to see food riots in places all over the globe. It was the rapid rise in food prices which sparked revolts in Tunisia and Egypt. The famines in Africa look to be the worst they have been in generations.
Back here in the states, we are seeing price increases that dwarf what happens at the pump. Whether we are shopping in the cereal aisle or ordering a thick crust pizza, the price is going up because the food supply is being tampered with. Anything with corn or wheat or flour in it is affected. Over the last few decades, we have seen the phenomenon of low cost food being less healthy than more expensive food and low cost food is loaded with corn syrup and corn starch.
Ethanol is a quick fix that we can do so that we feel better about ourselves, but the reality is that it causes pollution and drives millions to starvation. We were better served to find ways to replace petroleum wherever possible.
One quick example of this is the compact fluorescent light bulb. We all know that we are supposed to use them because they are good for the environment. There are commercials that play quite often. I do not know what they are advertising but there is a happy smiling woman who tells us that doing something simple like changing a light bulb gives us a feeling of empowerment over our lives. I changed my own light bulbs over to the fluorescent kind four years ago. The problem is – when these bulbs die and we throw them away, they are full of toxic mercury. Suddenly they are very bad for the environment.
A bigger and more pressing issue is ethanol. It is a popularly accepted belief that ethanol is good for the environment. I believe that it is true that corn burns cleaner than oil. However, corn burns a lot less efficiently than oil. You use more ethanol fuel to go somewhere than you do oil. It also takes much more energy to turn corn into fuel than it does to turn oil into fuel. Ethanol is also corrosive. Fuel made from oil can be pumped through a pipeline. Ethanol would eat through the pipeline so it needs to be trucked to where it’s going. To burn a gallon of ethanol turns out more pollution than a gallon of oil based fuel.
This is not to say that there is no place for ethanol within the whole. Even with all of the new oil being pumped out of the ground, it is not going to be here forever. I remember the predictions that it would be gone by 1990. While that was wrong, it is true that is a finite resource that everyone wants and this takes power and control away from us (the users) and gives it to people who have radically different feelings about life and death (the producers). We need to find better ways to make ethanol and better ways to use it.
The biggest problem with ethanol is that it reduces the food supply. I have to give credit to Fidel Castro, he had this right. Because the industrialized world is concerned with how much we need to spend to fill our gas tanks, food is being removed from the third world. A sizable chunk of the world population spends seventy-five percent or more of their assets on food. Any increase in food prices is devastating to them. We are beginning to see food riots in places all over the globe. It was the rapid rise in food prices which sparked revolts in Tunisia and Egypt. The famines in Africa look to be the worst they have been in generations.
Back here in the states, we are seeing price increases that dwarf what happens at the pump. Whether we are shopping in the cereal aisle or ordering a thick crust pizza, the price is going up because the food supply is being tampered with. Anything with corn or wheat or flour in it is affected. Over the last few decades, we have seen the phenomenon of low cost food being less healthy than more expensive food and low cost food is loaded with corn syrup and corn starch.
Ethanol is a quick fix that we can do so that we feel better about ourselves, but the reality is that it causes pollution and drives millions to starvation. We were better served to find ways to replace petroleum wherever possible.
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