Inside Ron Paul's 'End the Fed'
Title: End the Fed
Author: Ron Paul
Publisher: Grand Central, 2009
ISBN-13: 978-0446549196, 224 pages
Review: End the Fed
By Patrick Brigger, getAbstract
Everybody cares about money, but do you really understand it? How much do you know about the Federal Reserve, the American institution that plays a profound but secretive role in steering the U.S. economy? Congressman and erstwhile presidential candidate Ron Paul believes that the Federal Reserve, not money, is the root of all evil. In his somewhat repetitious--and sometimes fearful--book, Paul holds the Fed responsible for wars, recessions, depressions, bubbles, busts, scheming politicians, overextended consumers and creeping socialism. And that's just in the first chapter. Libertarian Paul wants to rid the U.S. of the arrogant cabal behind the central bank and return the American economy to a truly free market-based and gold-based system. Although his conclusions may strike some readers as far fetched, his reasoning is based on years of self-taught economics and legislative experience. While the opinions expressed are those of the author alone, getAbstract would suggest this book to his supporters and to non-Libertarians who would like to understand an alternative point of view.
Why the Fed?
The Federal Reserve, America's central bank, exists to maintain a stable economy, to regulate banking organizations and to manage inflation. But its true purpose, one that no other institution in the U.S. can claim, is that it "enables the creation of money out of thin air." When bad economic times hit, everyone expects the government to throw money at the problem. That's surely the case during crises like the 2008 emergency when the government spends billions of dollars to prop up the economy. But are such actions the right solutions in the long term? And how will those actions affect you? To comprehend money, you must know what a central bank does, how it works and why abolishing the Fed ensures America's financial future.
Most Americans assume that the Fed is a necessary organ of government, and that its absence would destabilize the economy. Yet at the time of the founding of the United States, Thomas Jefferson fought the establishment of a central bank. Thomas Paine, a seminal essayist of the American Revolution, wrote that the uncontrolled issuance of paper money invariably leads to tyranny.
Closing down the Fed would:
• Prevent the government from financing needless wars and halt the dollar's decline.
• "Curb the government's attacks on the civil liberties of Americans."
• End the nation's growing debt and stop uncontrolled government growth.
• Slow the development "of the welfare state that has turned [the U.S.] into a nation of dependents."
• Reinstate "constitutional government."
• Put an end to successions of booms and busts and finish off inflation once and for all.
• Ensure Americans' wealth and make their deposits more secure.
• Cease the "corrupt collaboration between government and banks" and revive banks' financial health.
• Remove "monetary manipulation" from political elections.
• "Restore sanity to economic and political life in this country."
Questioning the Fed takes on more importance now, because the amount of money created in response to the 2007-2008 downturn and the secrecy under which the Fed operates raise concerns of hyperinflation along the lines of Germany's between the world wars. From April 2008 to April 2009, one set of statistics showed a doubling of the money supply. These funds, held as reserves in U.S. banks, are ready to underwrite loans when the economy improves, but such loans will lead to soaring price escalations and to more indebtedness...
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