SPEECH OF
HON. RON PAUL
OF TEXAS
IN THE HOUSE OF REPRESENTATIVES
Wednesday, September 29, 2010
2010 Ron Paul 53:1
Mr. PAUL.
Mr. Speaker, the imbalances in
international trade, and in particular trade between
China and the United States, have
prompted many to demand a realignment of
the Chinese yuan and the American dollar.
Since we are running a huge trade deficit with
China the call now is for a stronger yuan and
a weaker dollar. This trade imbalance problem
will not be solved so easily.
2010 Ron Paul 53:2
I would urge my colleagues to consider the
benefits we receive from our relationship with
China, one of which is that American consumers
benefit from lower-priced goods.
Adopting the policy urged by supporters of this
bill would cause consumer prices to increase,
thus reducing consumersí wealth. Other producers
would suffer as a result of the consumersí
decreased purchasing power. I doubt
that many of our constituents want us to increase
the prices they pay for goods and services.
2010 Ron Paul 53:3
Congress should also consider how the Chinese
benefit the United States government by
holding our debt. The dollars the Chinese acquire
by selling us goods and services must
be returned to the United States. Since the
Chinese are not buying an equivalent amount
of American goods and services, they are
using the dollars to finance Congressí extravagant
spending.
2010 Ron Paul 53:4
This deep and legitimate concern for the
trade imbalance between China and the U.S.
will fall short if the issue of fluctuating, world-
wide fiat currencies is not addressed. The fact
that the U.S. dollar is the principal reserve currency
of the world gives us a benefit that others
do not enjoy. It allows us to export paper
dollars and import goods manufactured in
countries with cheap labor. It also allows us to
finance the welfare/warfare state with cheap
loans from China and Japan. Itís a good deal
for the government but according to economic
law must come to an end, and the end will be
messy for the U.S. consumer and for world
trade.
2010 Ron Paul 53:5
Our current account deficit and huge foreign
indebtedness is a reflection of the world monetary
system of fiat money. The longer the
trade imbalances last, the more difficult the
adjustment will be. The market will eventually
force these adjustments on us.
2010 Ron Paul 53:6
Instead of having fluctuating currency exchange
rates and the inevitable instability that
accompanies them, we should be working to
establish a commodity-backed currency whose
value is determined by the market. This would
provide an objective measurement of the
value of economic goods and services and
thus strengthen the economy by freeing it from
the negative effects of our unstable monetary
policy.
2010 Ron Paul 53:7
Instead of promoting global economic government,
the United States Congress should
reform those policies that reduce our manufacturersí
competitiveness. The taxes and regulations
imposed on American businesses are
damaging economic growth and killing jobs. If
we were serious about creating jobs, we
would be working on an aggressive agenda of
cutting taxes and repealing needless regulations.
2010 Ron Paul 53:8
Congress can also improve Americaís competitive
position by ending the practice of forcing
American workers to subsidize their foreign
competitors through organizations such
as the Export-Import Bank and the International
Monetary Fund.
2010 Ron Paul 53:9
In conclusion, Mr. Speaker, I remind my colleagues
that stability in currencies is something
we should seek, not something we
should condemn. The bill before us today will
not solve our problems. In fact, by refusing to
address the economic stability created by fiat
currency and instead embracing protectionism,
it will further weaken the American economy.
