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2005 Ron Paul Chapter 33
Not linked on Ron Paul’s Congressional website.
Congressional Record [.PDF]
The Deficit
16 March 2005
Mr. ENGLISH of Pennsylvania. Mr.
Chairman, I yield 7 minutes to the distinguished
gentleman from Texas (Mr.
PAUL), a fellow member of the Joint
Economic Committee.
(Mr. PAUL asked and was given permission
to revise and extend his remarks.)
2005 Ron Paul 33:1
Mr. PAUL. Mr. Chairman, I thank the gentleman for yielding me this
time.
2005 Ron Paul 33:2
Mr. Chairman, I appreciate very much this opportunity to talk about
the budget. In listening to the debate
today on both sides of the aisle, there
has been a lot of expression of concern
about the deficit; and, of course, I am
very concerned about the deficit as
well.
2005 Ron Paul 33:3
But I would like to make a suggestion that we are not facing primarily a
budgetary crisis or a budgetary problem.
I see this more as a philosophic
problem, dealing more with the philosophy
of government rather than thinking
that we can tinker with the budget,
dealing with this as a tactical problem
when really it is a strategic problem.
So as long as we endorse the type of
government that we have and there is
a willingness for the people as well the
Congress to finance it, we are going to
continue with this process and the
frustrations are going to grow because
it is just not likely that these deficits
will shrink.
2005 Ron Paul 33:4
And the gentleman from Pennsylvania rightly pointed out the concerns
this might have in the financial markets.
I am hoping that his optimism
pans out because, indeed, if they do
not, there could be some ramifications
from these expanding deficits and what
it means to our dollar.
2005 Ron Paul 33:5
But I would like to suggest that in dealing with the budget itself, I see
only one problem that we have. And
that problem to me is the budget is too
big, and I would like to shrink the
budget. I have toyed with the idea over
the years to introduce and offer a constitutional
budget to the House floor.
That would not be too difficult because
the budget would be so much smaller.
It would mean essentially that if one is
a strict constitutionalist that they
would cut the budget approximately 80
percent.
2005 Ron Paul 33:6
What would that mean to the economy? It would be a boost because we
would be injecting $2 trillion back into
the economy, allowing the people to
spend their own money. But being pretty
realistic, I know that is not likely
to happen or be offered or even be able
to present that on the House floor. Besides,
it could be rather embarrassing
to bring something like that to the
floor. Not so much embarrassing to me,
because I am accustomed to voting in a
small group of people on many occasions;
but it could be embarrassing to
others because, for the most part, most
Members would not even conceive of
the idea of having a strict interpretation
of the Constitution and severely
limiting the budget. So we would not
want to put everybody on record for
that.
2005 Ron Paul 33:7
The other day I heard an interview with one of our Members, and he was
asked about a particular program
about where the authority came from
in the Constitution for that program.
And his answer was very straightforward;
and he explained that in the
Constitution there was no prohibition
against that program, so therefore it
was permitted. In his mind, as it is in
the minds of many Members of Congress,
if there is no strict prohibition,
it is permitted.
2005 Ron Paul 33:8
And that is just absolutely opposite of what was intended by the authors of
the Constitution that we would only be
able to do those things which are explicitly
permitted in the Congress, and
they are spelled out rather clearly in
article I, section 8.
2005 Ron Paul 33:9
And then we are given the permission to write the laws that are necessary
and proper to implement those powers
that are delegated to us. Those powers
that are not delegated are reserved to
the States and to the people. So it
means that those things that are not
prohibited are permitted, but I would
say that the conventional wisdom
today is that people accept the notion
that we can do anything that we want
as long as it is not prohibited by the
Constitution.
2005 Ron Paul 33:10
I think this improper understanding and following of the Constitution has
brought us closer to a major crisis in
this country, a crisis of our personal
liberties, a crisis in our foreign policy,
as well as a crisis in our budgeting.
2005 Ron Paul 33:11
But it is not simply the ignoring of the Constitution that I think is our
problem. I think our other problem is
our country and our people and our
Congresses and our Senators have accepted
the notion of faith in government,
faith in the State, that the State
can provide these great services and do
it efficiently.
2005 Ron Paul 33:12
Really, there are only two areas that would have to be cut if we were to
strive for a constitutional budget.
There are only two things that we
would have to cut, and it would be welfare
and warfare. And then we would
get back to some fundamentals. During
World War I, a gentleman by the name
of Randolph Bourne wrote a pamphlet
called “War is the Health of the
State,” and I truly believe that. When
we are at war, we are more likely to
sacrifice our liberties; and, of course,
we spend more money that we really
have. I would like to suggest a corollary,
that peace is the foundation of
liberty because that is what the goal of
all government should be: the preservation
of liberty.
2005 Ron Paul 33:13
We have endorsed a program with this interpretation that spending is
going to be endlessly increased, and we
have devised a system whereby we have
ignored the constraints through monetary
policy by not only are we taxing
too much and borrowing too much; we
have now since 1971 endorsed a monetary
system that if we come up short
we just print the money. And I would
suggest to the gentlewoman that one of
the reasons why the workers’ purchasing
power is going down is we print
too many dollars and they are the ones
who are most likely and first to suffer
from inflation.
2005 Ron Paul 33:14
And it is the philosophy of government and our philosophy on money
that encourages these problems. And
the current account deficits and this
huge foreign indebtedness that are encouraged
by our ability to maintain a
reserve currency, it is going to lead to
a crisis where this spending will have
to come in check.
2005 Ron Paul 33:15
And that is why the gentleman from Pennsylvania is quite correct that we
should be concerned about how the financial
markets look at what we do.
And hopefully we will be able to deal
with this in a budgetary way and institute
some restraints. But quite frankly
I am a bit pessimistic about that. This
program that we follow and this philosophy
we followed prompted our Federal
Reserve to create $620 billion in order
to finance the system. That is the reason
that the dollar becomes less valuable,
because we just print too many to
accommodate the politicians and the
people who enjoy the excessive spending.
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