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End the Fed
In the post-meltdown world, it is irresponsible, ineffective, and ultimately useless to have a serious economic debate without considering and challenging the role of the Federal Reserve.
Most people think of the Fed as an indispensable institution without which the country's economy could not properly function. But in END THE FED, Ron Paul draws on American history, economics, and fascinating stories from his own long political life to argue that the Fed is both corrupt and unconstitutional. It is inflating currency today at nearly a Weimar or Zimbabwe level, a practice that threatens to put us into an inflationary depression where $100 bills are worthless. What most people don't realize is that the Fed -- created by the Morgans and Rockefellers at a private club off the coast of Georgia -- is actually working against their own personal interests. Congressman Paul's urgent appeal to all citizens and officials tells us where we went wrong and what we need to do fix America's economic policy for future generations.
Most people think of the Fed as an indispensable institution without which the country's economy could not properly function. But in END THE FED, Ron Paul draws on American history, economics, and fascinating stories from his own long political life to argue that the Fed is both corrupt and unconstitutional. It is inflating currency today at nearly a Weimar or Zimbabwe level, a practice that threatens to put us into an inflationary depression where $100 bills are worthless. What most people don't realize is that the Fed -- created by the Morgans and Rockefellers at a private club off the coast of Georgia -- is actually working against their own personal interests. Congressman Paul's urgent appeal to all citizens and officials tells us where we went wrong and what we need to do fix America's economic policy for future generations.
212 pages, Hardcover
First published September 16, 2009
About the author
Ron Paul
93 books521 followersRepublican United States Congressman from Lake Jackson, Texas, a physician, a bestselling author, and a former 2008 U.S. presidential candidate.
Originally from the Pittsburgh suburb of Green Tree, Pennsylvania, he studied at Duke University School of Medicine; after his 1961 graduation and a residency in obstetrics and gynecology, he became a U.S. Air Force flight surgeon, serving outside the Vietnam War zone. He later represented Texas districts in the U.S. House of Representatives (1976–1977, 1979–1985, and 1997–present). He entered the 1988 presidential election, running as the Libertarian nominee while remaining a registered Republican, and placed a distant third.
Paul has been described as conservative, Constitutionalist, and libertarian. He advocates a foreign policy of nonintervention, having voted against actions such as the Iraq War Resolution, but in favor of force against terrorists in Afghanistan. He favors withdrawal from the North Atlantic Treaty Organization and the United Nations, citing the dangers of foreign entanglements to national sovereignty. Having pledged never to raise taxes, he has long advocated ending the federal income tax, scaling back government spending, abolishing most federal agencies, and removing military bases and troops from foreign soil; he favors hard money and opposes the Federal Reserve. He also opposes the Patriot Act, the federal War on Drugs, No Child Left Behind, and gun control. Paul is strongly pro-life, and has introduced bills to negate Roe v. Wade, but affirms states' rights to regulate or ban abortion, rather than federal jurisdiction.
While Paul was a leading 2008 presidential candidate in some Republican straw polls, he saw substantially less support in landline opinion polls and in the actual primaries. Strong internet grassroots support was indicated by his popularity as a web search term, his lead in YouTube subscriptions, and, on December 16th 2007, the largest one-day fundraiser in U.S. political history, netting over $6 million in 24 hours through an independently organized effort. His book commenting on the presidential run, The Revolution: A Manifesto, became a bestseller immediately upon release and went on to be #1 on the New York Times nonfiction best sellers list.
Judge Andrew Napolitano calls him "the Thomas Jefferson of our day."
Ron Paul, the New York Post once wrote, is a politician who "cannot be bought by special interests."
"There are few people in public life who, through thick and thin, rain or shine, stick to their principles," added a congressional colleague. "Ron Paul is one of those few."
Originally from the Pittsburgh suburb of Green Tree, Pennsylvania, he studied at Duke University School of Medicine; after his 1961 graduation and a residency in obstetrics and gynecology, he became a U.S. Air Force flight surgeon, serving outside the Vietnam War zone. He later represented Texas districts in the U.S. House of Representatives (1976–1977, 1979–1985, and 1997–present). He entered the 1988 presidential election, running as the Libertarian nominee while remaining a registered Republican, and placed a distant third.
Paul has been described as conservative, Constitutionalist, and libertarian. He advocates a foreign policy of nonintervention, having voted against actions such as the Iraq War Resolution, but in favor of force against terrorists in Afghanistan. He favors withdrawal from the North Atlantic Treaty Organization and the United Nations, citing the dangers of foreign entanglements to national sovereignty. Having pledged never to raise taxes, he has long advocated ending the federal income tax, scaling back government spending, abolishing most federal agencies, and removing military bases and troops from foreign soil; he favors hard money and opposes the Federal Reserve. He also opposes the Patriot Act, the federal War on Drugs, No Child Left Behind, and gun control. Paul is strongly pro-life, and has introduced bills to negate Roe v. Wade, but affirms states' rights to regulate or ban abortion, rather than federal jurisdiction.
While Paul was a leading 2008 presidential candidate in some Republican straw polls, he saw substantially less support in landline opinion polls and in the actual primaries. Strong internet grassroots support was indicated by his popularity as a web search term, his lead in YouTube subscriptions, and, on December 16th 2007, the largest one-day fundraiser in U.S. political history, netting over $6 million in 24 hours through an independently organized effort. His book commenting on the presidential run, The Revolution: A Manifesto, became a bestseller immediately upon release and went on to be #1 on the New York Times nonfiction best sellers list.
Judge Andrew Napolitano calls him "the Thomas Jefferson of our day."
Ron Paul, the New York Post once wrote, is a politician who "cannot be bought by special interests."
"There are few people in public life who, through thick and thin, rain or shine, stick to their principles," added a congressional colleague. "Ron Paul is one of those few."
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August 25, 2010
I picked this book up because I know that it gives voice to feelings that a lot of Americans share, and I thought it would be worth trying to understand that movement.
When I started this book, I at least respected Ron Paul for being consistent--he not only opposes the Fed and other "liberal" government programs, but also conservative centerpieces like the invasion of Iraq. But as I read this book, one of the main things that jumped out at me was his inconsistency on economic matters. He poses as taking a hard conservative line on everything--not only is he opposed to the Fed, but also to the FDIC and even the existence of fractional reserve banking (which is a necessary precondition to the bank runs against which the Fed and FDIC are supposed to protect). He says that financial institutions should be separated into custodian-type banks, that basically hold your money under the mattress, and investment-conduit type entities without demand deposits. That way, everyone investing in the conduits would be aware that their money was at risk, and if a custodian bank failed, it would be prosecuted for fraud. First, I think that Paul underestimates the level of regulation that would be needed to enforce these rules. Indeed, fractional-reserve banking is a free-market invention and it is strange that Paul, the self-styled free-marketeer, would oppose it. Second, I think Paul vastly underestimates the desire of the average saver for a risk-free savings vehicle and for demand deposits. Under Paul's system I would expect a near-complete depletion of the supply of funds available for credit, massively restricting the funds available for investment.
It also strikes me as odd that self-styled free-marketeers like Paul support the gold standard so strongly. After all, setting a conversion rate between gold and dollars is identical to government fixing of the price of gold--not exactly a free-market idea. What's more, I imagine Paul would like all countries to be on a gold standard, which is equivalent to saying that all exchange rates should be fixed, again by government fiat. These inconsistencies are apart from all the other ludicrous outcomes that would result from maintaining the gold standard, such as the fact that if another country were able to steal our gold reserves our currency's value would go to zero immediately, or that the level of gold production would be the (completely arbitrary) determinant of the money supply.
Overall Paul's book is in the classic style of Austrian economics. It is devoid of empirics and relies completely on logical syllogism. Many of these syllogisms appear superficially sensible but in fact rely on extremely problematic premises, such as the very common analogy of the government budget to a personal budget. It relies on fuzzy semantics and conflation of different issues. The main example of this is the definition of the term "inflation". Mainstream economists define this as the rate of change in the aggregate price level--you can debate exactly how to measure this, but the consensus is that the concept is reasonably well-defined. Paul and other Austrians, though, insist that the "real" definition of "inflation" should simply be the rate of change in the money supply, abstracted from any effect on prices. This allows them to draw a very strong connection between central banks and the existence of inflation, but then they turn around and discuss the pernicious effects of inflation on the consumer, implicitly reverting back to the standard definition of inflation (after all, how does the aggregate money supply impact the consumer if not through price levels?). Finally, and most frustratingly, Paul takes the classic extremist's position that no historical fact can serve as a counterargument to his position, because his position is so extreme that it has never actually been implemented in reality (and never will be). Thus he dismisses the massive financial panics of the nineteenth century with a wave of the hand.
Don't mess with my job, Ron.
When I started this book, I at least respected Ron Paul for being consistent--he not only opposes the Fed and other "liberal" government programs, but also conservative centerpieces like the invasion of Iraq. But as I read this book, one of the main things that jumped out at me was his inconsistency on economic matters. He poses as taking a hard conservative line on everything--not only is he opposed to the Fed, but also to the FDIC and even the existence of fractional reserve banking (which is a necessary precondition to the bank runs against which the Fed and FDIC are supposed to protect). He says that financial institutions should be separated into custodian-type banks, that basically hold your money under the mattress, and investment-conduit type entities without demand deposits. That way, everyone investing in the conduits would be aware that their money was at risk, and if a custodian bank failed, it would be prosecuted for fraud. First, I think that Paul underestimates the level of regulation that would be needed to enforce these rules. Indeed, fractional-reserve banking is a free-market invention and it is strange that Paul, the self-styled free-marketeer, would oppose it. Second, I think Paul vastly underestimates the desire of the average saver for a risk-free savings vehicle and for demand deposits. Under Paul's system I would expect a near-complete depletion of the supply of funds available for credit, massively restricting the funds available for investment.
It also strikes me as odd that self-styled free-marketeers like Paul support the gold standard so strongly. After all, setting a conversion rate between gold and dollars is identical to government fixing of the price of gold--not exactly a free-market idea. What's more, I imagine Paul would like all countries to be on a gold standard, which is equivalent to saying that all exchange rates should be fixed, again by government fiat. These inconsistencies are apart from all the other ludicrous outcomes that would result from maintaining the gold standard, such as the fact that if another country were able to steal our gold reserves our currency's value would go to zero immediately, or that the level of gold production would be the (completely arbitrary) determinant of the money supply.
Overall Paul's book is in the classic style of Austrian economics. It is devoid of empirics and relies completely on logical syllogism. Many of these syllogisms appear superficially sensible but in fact rely on extremely problematic premises, such as the very common analogy of the government budget to a personal budget. It relies on fuzzy semantics and conflation of different issues. The main example of this is the definition of the term "inflation". Mainstream economists define this as the rate of change in the aggregate price level--you can debate exactly how to measure this, but the consensus is that the concept is reasonably well-defined. Paul and other Austrians, though, insist that the "real" definition of "inflation" should simply be the rate of change in the money supply, abstracted from any effect on prices. This allows them to draw a very strong connection between central banks and the existence of inflation, but then they turn around and discuss the pernicious effects of inflation on the consumer, implicitly reverting back to the standard definition of inflation (after all, how does the aggregate money supply impact the consumer if not through price levels?). Finally, and most frustratingly, Paul takes the classic extremist's position that no historical fact can serve as a counterargument to his position, because his position is so extreme that it has never actually been implemented in reality (and never will be). Thus he dismisses the massive financial panics of the nineteenth century with a wave of the hand.
Don't mess with my job, Ron.
January 16, 2021
April, 2014 - Started great! Very reasonable description of the Fed and reasons why it needs to be ended.
This book is excellent. The Audio CD narrator is really great. I LOVE his voice. The vocal sound is just right. Really brings out the best in Ron Paul's words. Even though the ideas Ron Paul holds are fundamentally radical (meaning "to the root" NOT meaning "left wing" nor "destructive"), he makes them seem eminently reasonable and easy to agree with by just about anyone. He is quite a gentleman to his political opponents. His tone in this book is such a contrast to the sarcastic one in Tom Woods' Meltdown, even though many of the ideas, facts and analyses are the same or very similar.
Book title came from a gathering in 2007 of 4000 students at Univ. of Michigan to hear Ron Paul talk. The students started chanting the phrase "End the Fed." The phrase, he claims, was not his, originally. This book is a great follow-up to that beginning.
The history of the Fed presented in this book is really great to know.
The history of money in the US before the Fed is also very, very informative. The book explodes many myths that have built up about the Fed, money, gold, the great depression, "free banking" in the US in the 1800s, and many more. He does a good job of outlining what positive changes could come about by getting rid of the Fed, given a sound understanding of economics and history.
The book talks about the excellent Austrian economists, Ludwig Mises, Friedrich Hayek, Murray Rothbard and others. He also does a wonderful job of giving Keynes his due regarding his prescient writing about inflation early in his career, but also the terrible consequences of Keynes' changes to the economics profession during the Great Depression. He had some interesting things to say about Ayn Rand and her ideas too.
I enjoyed the descriptions of his personal experiences with such figures as Alan Greenspan, Ben Bernanke and Paul Volker, even though I was only partly impressed with his verbatim questions to the first two from his US House hearings participation.
I liked the contrast he was able to demonstrate between the economic (and intellectual) climate in the country during his early career (in the mid-late 70s and the more recent events leading up to and during the 2008 economic crisis and Presidential election.
I did see some very minor errors, as well as a focus on the idea of a 100% reserve requirement for banks, which is not by any means an accepted Austrian economic idea. He was clearly influenced on this issue more greatly by Lew Rockwell and Murray Rothbard, than by the critique of this idea by Mises and other Austrian economists, let alone the economics profession in general.
Despite any minor flaws, I heartily recommend this audio book, if you are interested in any of the ideas, people or events mentioned above, and quite a bit more.
I edited this review , fairly lightly, for style and clarity, on 2021-01-16.
This book is excellent. The Audio CD narrator is really great. I LOVE his voice. The vocal sound is just right. Really brings out the best in Ron Paul's words. Even though the ideas Ron Paul holds are fundamentally radical (meaning "to the root" NOT meaning "left wing" nor "destructive"), he makes them seem eminently reasonable and easy to agree with by just about anyone. He is quite a gentleman to his political opponents. His tone in this book is such a contrast to the sarcastic one in Tom Woods' Meltdown, even though many of the ideas, facts and analyses are the same or very similar.
Book title came from a gathering in 2007 of 4000 students at Univ. of Michigan to hear Ron Paul talk. The students started chanting the phrase "End the Fed." The phrase, he claims, was not his, originally. This book is a great follow-up to that beginning.
The history of the Fed presented in this book is really great to know.
The history of money in the US before the Fed is also very, very informative. The book explodes many myths that have built up about the Fed, money, gold, the great depression, "free banking" in the US in the 1800s, and many more. He does a good job of outlining what positive changes could come about by getting rid of the Fed, given a sound understanding of economics and history.
The book talks about the excellent Austrian economists, Ludwig Mises, Friedrich Hayek, Murray Rothbard and others. He also does a wonderful job of giving Keynes his due regarding his prescient writing about inflation early in his career, but also the terrible consequences of Keynes' changes to the economics profession during the Great Depression. He had some interesting things to say about Ayn Rand and her ideas too.
I enjoyed the descriptions of his personal experiences with such figures as Alan Greenspan, Ben Bernanke and Paul Volker, even though I was only partly impressed with his verbatim questions to the first two from his US House hearings participation.
I liked the contrast he was able to demonstrate between the economic (and intellectual) climate in the country during his early career (in the mid-late 70s and the more recent events leading up to and during the 2008 economic crisis and Presidential election.
I did see some very minor errors, as well as a focus on the idea of a 100% reserve requirement for banks, which is not by any means an accepted Austrian economic idea. He was clearly influenced on this issue more greatly by Lew Rockwell and Murray Rothbard, than by the critique of this idea by Mises and other Austrian economists, let alone the economics profession in general.
Despite any minor flaws, I heartily recommend this audio book, if you are interested in any of the ideas, people or events mentioned above, and quite a bit more.
I edited this review , fairly lightly, for style and clarity, on 2021-01-16.
October 25, 2009
"His dominion is an eternal dominion; his kingdom endures from generation to generation. All the peoples of the earth are regarded as nothing. He does as he pleases with the powers of heaven and the peoples of the earth. No one can hold back his hand or say to him: 'What have you done?'"
(Nebuchadnezzar's confession Dan 4:22ff.)
Ron Paul's, "End the FED" serves as a grand demonstration of God's providence ordering all things that come to pass. He does not state this in the book. However, in it, the truth is exposed about how the U.S. monetary system has morphed into little more than a house of cards ready to collapse at any moment. Sin and corruption have led the way.
In a couple of places, Scripture is used to demonstrate the wickedness of the actions of the Federal Reserve and what happened in Biblical times when money became worthless. The Scripture is used correctly--something often not the case when politicians use it. In fact, I don't recall ever hearing or reading what any other politician wrote or said who used the Scripture correctly.
Ron Paul traces the history of this fraud, demonstrates how such systems have always collapsed before its creation in the U.S. in 1913, and points out who it is that suffers under the corruption--the poor and middle class.
He then draws out how it is the FED can be abolished and sound money established once again according to the Constitution (that thing that all individuals serving in the three branches of government are sworn to uphold).
This book is worth the time reading it.
Written in haste,
Ron C.
(Nebuchadnezzar's confession Dan 4:22ff.)
Ron Paul's, "End the FED" serves as a grand demonstration of God's providence ordering all things that come to pass. He does not state this in the book. However, in it, the truth is exposed about how the U.S. monetary system has morphed into little more than a house of cards ready to collapse at any moment. Sin and corruption have led the way.
In a couple of places, Scripture is used to demonstrate the wickedness of the actions of the Federal Reserve and what happened in Biblical times when money became worthless. The Scripture is used correctly--something often not the case when politicians use it. In fact, I don't recall ever hearing or reading what any other politician wrote or said who used the Scripture correctly.
Ron Paul traces the history of this fraud, demonstrates how such systems have always collapsed before its creation in the U.S. in 1913, and points out who it is that suffers under the corruption--the poor and middle class.
He then draws out how it is the FED can be abolished and sound money established once again according to the Constitution (that thing that all individuals serving in the three branches of government are sworn to uphold).
This book is worth the time reading it.
Written in haste,
Ron C.
October 28, 2009
An excellent, thought-provoking--yet brief enough to read in a day or two (though some chapters you may want more time to ponder and research)--book.
I was attracted to Ron Paul via his campaign for president in 2008. I believe I had heard of him before, but he was never in the forefront so his voice was muffled by the noise of larger candidates.
Of all the candidates 2008 he seemed to be the most grounded, the most sound in his arguments, and the least likely to fling the rhetorical BS. His call for less gov't intrusion in our own lives as well as overseas struck a chord. It definitely goes against everything we have been taught over the years about how our economy is "the best in the world," or our educational system is the "most sound," or how we are the lone superpower and have a duty to be the "world's policeman." The situation in 2007-8 seemed to fly in the face of all those old paradigms and I felt he was the only candidate speaking so frankly about breaking down those old paradigms we are all indoctrinated by from our parents, teachers, professors, co-workers, as well as just friends and colleagues.
Ron Paul's popularity is finally starting to grow but it is not because of his natural charisma--but because of his age-old ideas of "normalcy" that founded our country. The principles behind our Constitution were not gov't intervention into each and every corner of our lives or the world. We need to respect the wisdom of those Founders because we have gone astray. We have become a nation of dependencies and believing that there truly is wealth & happiness that can be gained from thin-air. The very things are parents always taught us ("money doesn't grow on trees") is simply being turned upside down by the very country and gov't we are supposedly protected by. But that protection is a ruse when it encourages and allows our elected leaders to fleece us and rob Peter (who has been working hard and earned his wealth) to pay Paul (who is wealthy already and doesn't need anymore).
I am not a full-fledged Ron Paul-ophile, yet. But his call for throwing off the chains of the Fed and returning back to responsible economic principles of the free-market and savings, is very appealing. Imagine an actual return to those principles to get us out of these times (yes, it will be painful at first) instead of perpetuating and encouraging the very people that screwed us in the first place to continue doing so. Something is bass-ackwards about that belief...and hopefully Rep. Paul and those he inspires in the future will open our eyes and come to our senses.
I was attracted to Ron Paul via his campaign for president in 2008. I believe I had heard of him before, but he was never in the forefront so his voice was muffled by the noise of larger candidates.
Of all the candidates 2008 he seemed to be the most grounded, the most sound in his arguments, and the least likely to fling the rhetorical BS. His call for less gov't intrusion in our own lives as well as overseas struck a chord. It definitely goes against everything we have been taught over the years about how our economy is "the best in the world," or our educational system is the "most sound," or how we are the lone superpower and have a duty to be the "world's policeman." The situation in 2007-8 seemed to fly in the face of all those old paradigms and I felt he was the only candidate speaking so frankly about breaking down those old paradigms we are all indoctrinated by from our parents, teachers, professors, co-workers, as well as just friends and colleagues.
Ron Paul's popularity is finally starting to grow but it is not because of his natural charisma--but because of his age-old ideas of "normalcy" that founded our country. The principles behind our Constitution were not gov't intervention into each and every corner of our lives or the world. We need to respect the wisdom of those Founders because we have gone astray. We have become a nation of dependencies and believing that there truly is wealth & happiness that can be gained from thin-air. The very things are parents always taught us ("money doesn't grow on trees") is simply being turned upside down by the very country and gov't we are supposedly protected by. But that protection is a ruse when it encourages and allows our elected leaders to fleece us and rob Peter (who has been working hard and earned his wealth) to pay Paul (who is wealthy already and doesn't need anymore).
I am not a full-fledged Ron Paul-ophile, yet. But his call for throwing off the chains of the Fed and returning back to responsible economic principles of the free-market and savings, is very appealing. Imagine an actual return to those principles to get us out of these times (yes, it will be painful at first) instead of perpetuating and encouraging the very people that screwed us in the first place to continue doing so. Something is bass-ackwards about that belief...and hopefully Rep. Paul and those he inspires in the future will open our eyes and come to our senses.
November 25, 2023
I should have read this book a long time ago, but I never had the time to do it until now.
This book required some knowledge or basic understanding of the Austrian School of Economics, the free market, the gold standard, central banking, the Great Depression of the 1930s and the Great Global Recession in 2008-2009.
In this book, Dr. Ron Paul talked about his biggest influences in Ludwig von Mises and Murray Rothbard, the Ron Paul/End The Fed Revolution, the Congressional hearings and interviews with the chief of the Federal Reserves, and many more.
This is not about replacing the Fed. It's about ending the Fed. The solution is basically that: End The Fed. The Big Government can no longer fund unnecessary wars overseas nor protect/bailout big businesses from competing in the free market.
There's so much to talk about, but it's even better if you read the book.
This book required some knowledge or basic understanding of the Austrian School of Economics, the free market, the gold standard, central banking, the Great Depression of the 1930s and the Great Global Recession in 2008-2009.
In this book, Dr. Ron Paul talked about his biggest influences in Ludwig von Mises and Murray Rothbard, the Ron Paul/End The Fed Revolution, the Congressional hearings and interviews with the chief of the Federal Reserves, and many more.
This is not about replacing the Fed. It's about ending the Fed. The solution is basically that: End The Fed. The Big Government can no longer fund unnecessary wars overseas nor protect/bailout big businesses from competing in the free market.
There's so much to talk about, but it's even better if you read the book.
April 28, 2011
I have a new respect for Ron Paul. He has done a lifetime of homework on this topic and obviously knows what he's talking about. Paul titles his book with a demand: End the Fed. By the end of the book you'll support that demand as he does a convincing job in showing that our nation's economic problems are magnified and often even brought on as a direct result of the actions of the Federal Reserve. Paul starts with a fundamental fact about the Federal Reserve, "After all is said and done, the Fed has one power that is unique to it alone: it enables the creation of money out of thin air."
This fundamental fact is the source of much mischief. Indeed, says Paul, "If you solve the money monopoly problem by ending the Fed, you solve many other problems too. Essentially you take away from the government the capacity to use financial trickery to expand without limit. It is the first step to restoring constitutional government. Without the Fed, the federal government would have to live with in its means"
And yet the inflationary activities of the Fed have not only not abated, but are increasing exponentially. The creation of new money with Tarp, Stimulus I and II and the rounds of "qualatative easing" has potential and probable catastrophic ramifications for our economy. Paul write, "This new money (created by the fed between April 2008 and April 2009) now sit as reserves in bank vaults awaiting a safe environment for lending and borrowing. Should that save environment arrive, we could see a level of price increases none of us have experienced in our lifetime." We are starting to see this now with huge increases in the price of gasoline, food, and other commodoties like cotton. Conveniently, the Fed no longer counts food or energy in it's calculations for inflation.
We are being led from crisis to crisis but as Paul underscores, "A point we learn…is that crises have always led to greater centralization." And this greater centralization leads to further crisis.
Paul further states that "In a capitalist economy, the prospect of failure imposes discipline and consumer service. It is an essential aspect of the competitive marketplace, whereas a promise against failure (given by the Fed to certain to-big-to-fail corporations) only entrenches inefficiency and incompetency." This behavior only delays failure, and makes it, when it occurs, more catastrophic.
Paul also explains how the a central bank's ability to in effect counterfiet, makes wars more deadly and longer lasting. He writes, "Might a diplomatic solution have been found for the struggles that led to WWI had the Germans and English not had recourse to the printing press as a lender of last resort?"
He also gives a neat insight into the thinking of Ronald Reagan who said to Paul, "Ron, no great nation that abandoned the gold standard has remained a great nation"
He exposes the fact that the chairmen of the Fed, know what they are doing. For example here's what Alan Greenspan wrote in 1966:
“this is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists antagonism toward the gold standard”
But in 2005 as Chairman of the Federal Reserve, his tune changed. Here's what he said in response to a question put forth to him by Congressman Ron Paul “Would there be any advantage, at this particular stage in going back to the gold standard? And the Answer is: I don’t think so, because we’re acting as though we were.” NOT!
Paul does a good job of exposing the Federal government's complicity in the immoral activities of the Fed. The Fed's inflationary policies enable government to pay for their extravegance without neccesarily having to raise taxes, as inflation is itself a tax. "Inflation is the most vicious and regressive of all forms of taxation. It transfers wealth from the middle class to the privileged rich." Notes Paul, "Tyranny always goes hand in hand with government’s wrecking of the money system."
Still, the Congressman is sadly optimistic that the current crisis will bring about changes because, "The current crisis, started in 2007 with the break in the housing mortgage market, is now in full swing and signifies the end of the fiat dollar reserve currency system."
He exposes the Fed's role in creating the housing bubble, "Artificially low interest rates are achieved by inflating the money supply, and they penalize the thrifty and cheat those who save. They promote consumption and borrowing over savings and investing. Manipulating interest rates is an immoral act. It’s economically destructive."
The Federal Reserve should be abolished, and here's Paul on why: "The Federal Reserve should be abolished because it is immoral, unconstitutional, impractical, promotes bad economics, and undermines liberty. Its destructive nature makes it a tool of tyrannical government."
Ron Paul makes the case for ending the Fed convincingly, and I'd recommend this book to any who are seriously searching for answers to the current round of financial insanity our country is experiencing. Certainly, it is a cause that anyone, who desires greater transparency in government can ride, whether liberal or conservative, Democrat or Republican.
This fundamental fact is the source of much mischief. Indeed, says Paul, "If you solve the money monopoly problem by ending the Fed, you solve many other problems too. Essentially you take away from the government the capacity to use financial trickery to expand without limit. It is the first step to restoring constitutional government. Without the Fed, the federal government would have to live with in its means"
And yet the inflationary activities of the Fed have not only not abated, but are increasing exponentially. The creation of new money with Tarp, Stimulus I and II and the rounds of "qualatative easing" has potential and probable catastrophic ramifications for our economy. Paul write, "This new money (created by the fed between April 2008 and April 2009) now sit as reserves in bank vaults awaiting a safe environment for lending and borrowing. Should that save environment arrive, we could see a level of price increases none of us have experienced in our lifetime." We are starting to see this now with huge increases in the price of gasoline, food, and other commodoties like cotton. Conveniently, the Fed no longer counts food or energy in it's calculations for inflation.
We are being led from crisis to crisis but as Paul underscores, "A point we learn…is that crises have always led to greater centralization." And this greater centralization leads to further crisis.
Paul further states that "In a capitalist economy, the prospect of failure imposes discipline and consumer service. It is an essential aspect of the competitive marketplace, whereas a promise against failure (given by the Fed to certain to-big-to-fail corporations) only entrenches inefficiency and incompetency." This behavior only delays failure, and makes it, when it occurs, more catastrophic.
Paul also explains how the a central bank's ability to in effect counterfiet, makes wars more deadly and longer lasting. He writes, "Might a diplomatic solution have been found for the struggles that led to WWI had the Germans and English not had recourse to the printing press as a lender of last resort?"
He also gives a neat insight into the thinking of Ronald Reagan who said to Paul, "Ron, no great nation that abandoned the gold standard has remained a great nation"
He exposes the fact that the chairmen of the Fed, know what they are doing. For example here's what Alan Greenspan wrote in 1966:
“this is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists antagonism toward the gold standard”
But in 2005 as Chairman of the Federal Reserve, his tune changed. Here's what he said in response to a question put forth to him by Congressman Ron Paul “Would there be any advantage, at this particular stage in going back to the gold standard? And the Answer is: I don’t think so, because we’re acting as though we were.” NOT!
Paul does a good job of exposing the Federal government's complicity in the immoral activities of the Fed. The Fed's inflationary policies enable government to pay for their extravegance without neccesarily having to raise taxes, as inflation is itself a tax. "Inflation is the most vicious and regressive of all forms of taxation. It transfers wealth from the middle class to the privileged rich." Notes Paul, "Tyranny always goes hand in hand with government’s wrecking of the money system."
Still, the Congressman is sadly optimistic that the current crisis will bring about changes because, "The current crisis, started in 2007 with the break in the housing mortgage market, is now in full swing and signifies the end of the fiat dollar reserve currency system."
He exposes the Fed's role in creating the housing bubble, "Artificially low interest rates are achieved by inflating the money supply, and they penalize the thrifty and cheat those who save. They promote consumption and borrowing over savings and investing. Manipulating interest rates is an immoral act. It’s economically destructive."
The Federal Reserve should be abolished, and here's Paul on why: "The Federal Reserve should be abolished because it is immoral, unconstitutional, impractical, promotes bad economics, and undermines liberty. Its destructive nature makes it a tool of tyrannical government."
Ron Paul makes the case for ending the Fed convincingly, and I'd recommend this book to any who are seriously searching for answers to the current round of financial insanity our country is experiencing. Certainly, it is a cause that anyone, who desires greater transparency in government can ride, whether liberal or conservative, Democrat or Republican.
November 4, 2009
This helped me understand the difference between fiat money and what Paul refers to as "sound" money. No doubt he's right that the Fed, like all powerful institutions, exists to concentrate its power further. The most interesting idea to me is that when the Fed creates money (i.e. inflates the dollar) the first receivers of the new money (banks, government agencies, corporations) can use it before it loses its value. By the time it reaches the last receivers (the average consumers) its value has been lost because the market has realized inflation has occured. Sound money in contrast requires no central bank because the money supply remains constant. (Virtually the only example of this kind of currency used consistently for the last 6,000 years is gold.)
I'm no economist, but it seems like all the money from all the economic recovery programs of the last year is still being played with by the first receivers as the Dow has surged and unemployment has climbed to 10%. If those last receivers ever see the money and unemployment goes down, the dollar will lose value, and probably quite a bit of it. People will find their paychecks don't buy very much, and their savings, as Paul would put it, have essentially been stolen by the banks, government agencies and biggest corporations.
But this information can be found elsewhere, and I wouldn't recommend reading this for a concise explanation of such things. Paul uses scare-words like communism and totalitarianism and platitudes like freedom and self-reliance to make his points. He is clearly playing to a certain demographic of which I'm not a member. I obtained this book illegally, though, so I can't complain. Libertarians only go halfway with their advocacy of "freedom." The state is only part of the system of oppression. Private wealth has been concentrated in the hands of a few since it came to exist along with the state. The two are inseparable and have become the hosts for unchecked technological progress that together threaten to do much worse than further disposses the majority. The solution has nothing to do with the movement to end the Fed.
I'm no economist, but it seems like all the money from all the economic recovery programs of the last year is still being played with by the first receivers as the Dow has surged and unemployment has climbed to 10%. If those last receivers ever see the money and unemployment goes down, the dollar will lose value, and probably quite a bit of it. People will find their paychecks don't buy very much, and their savings, as Paul would put it, have essentially been stolen by the banks, government agencies and biggest corporations.
But this information can be found elsewhere, and I wouldn't recommend reading this for a concise explanation of such things. Paul uses scare-words like communism and totalitarianism and platitudes like freedom and self-reliance to make his points. He is clearly playing to a certain demographic of which I'm not a member. I obtained this book illegally, though, so I can't complain. Libertarians only go halfway with their advocacy of "freedom." The state is only part of the system of oppression. Private wealth has been concentrated in the hands of a few since it came to exist along with the state. The two are inseparable and have become the hosts for unchecked technological progress that together threaten to do much worse than further disposses the majority. The solution has nothing to do with the movement to end the Fed.
March 16, 2012
This book is simply a repetitive declaration of Ron Paul's political position, not a detailed expository argument explaining his position. There are no detailed examples or comparative analysis. He might have a good reason why he disagrees with the Federal Reserve System, but it's not in this book.
Since it fails to even present its case, this book is ONLY for people who already support Ron Paul.
It's also poorly written.
Since it fails to even present its case, this book is ONLY for people who already support Ron Paul.
It's also poorly written.
January 11, 2021
More than 25% of all dollars in circulation were "printed" in 2020.
Few understand that Inflation benefits the few at the expense of many.
Must read.
December 8, 2018
First, a disclaimer: I'm a believer in both free markets and central banking, as are the overwhelming majority of academic economists today. I'm no economist, but I do have an interest in financial markets and enjoy reading an economic paper every once in a while. I received this book as a gift from a good conservative-libertarian friend, who apparently intended either to convert me or provoke me for a laugh. In summary, I don't pretend to be unbiased, but I have, in the past, given good reviews to books espousing views I disagree with. This was not such a book.
Further disclaimer: I like Ron Paul. I think he, like many people whose beliefs I disagree with, is a fundamentally good person who is trying to do the right thing. I'm also not opposed to crazy-sounding ideas; on the contrary, I think that the intelligent discussion of diverse ideas is a foundational pillar of our democracy.
This lengthy disclaimer exists to preemptively address those (I'm looking at you, Jake) who think that I gave this book a bad review because of my priors, or because I think Ron Paul is a crazy person, or because I never consider crazy sounding ideas. I gave this book a poor review because it's poorly written book, and here's why:
The first sign of trouble in this book is Paul overpromises to a degree that strains credulity. Essentially every good thing is caused by commodity money, and every bad thing is caused by central banks and fiat currency. According to Paul, commodity money guarantees liberty, small government, equality, world peace, continual economic growth through the elimination of recessions and the business cycle, and is endorsed by the Bible and Jesus (yes, he seriously argues this). By contrast, central bankers are a cabal of self-serving elites who use fiat money to steal your wealth, enable government handouts, usher in the rise of authoritarianism, cause wars, block international trade through tariffs, cause economic bubbles, and who caused the fall of Byzantium, enabled the rise of Hitler and are an overall source for evil. I'm obviously paraphrasing, but its an honest paraphrase; Paul actually does make each of these arguments. As a general rule, anytime someone promises a change this good and profound through one simple fix, they're wrong and you should be skeptical.
Paul's writing did little to assuage my skepticism. One of the big problems with the book is that it's all over the place in terms of structure. The book is neatly divided into chapters, but most of the content of the chapters is only loosely related to the title of the chapter. It's difficult to follow Paul's thinking systematically when he spends each chapter repeating his same denouncements of the Fed. I found this book to be jarringly repetitive, and if Paul had just focused in on the specifics and wroth about each chapter title the book would have been much better organized.
When I did identify arguments that Paul made (usually by mentally piecing together some common points he scatters throughout several different chapters), I didn't find them particularly convincing. For instance, Paul argues that the economists from the 'Austrian school' of economic thinking are unusually accurate in their future predictions regarding the economy. This would be convincing if true, but Paul doesn't give any actual evidence to support this other than some anecdotes. I doubt the anecdotes where the Austrians were wrong made it into the book. Oftentimes the Paul's explanations just seem prima facie false, and then he immediately moves on without justifying his view. Does anybody really believe that a gold standard would have solved the economic crisis in the Weimar Republic post WW1? Paul's take on that one exemplifies another problem that plagues the book: his belief that monetary solutions, namely the gold standard, will solve problems that are fundamentally fiscal in nature (although I think he makes good points of fiscal issues when he does venture there, particularly on the lack of accountability regarding the deficit).
Another issue I can think of off the top of my head is right at the end of the book where he gives his solution. He says that, on the gold standard, no new money should enter the system. This is difficult to figure, since new gold is being dug out of the ground all time time, and it seems odd to fix the money supply to the extraction rate of a particular metal. There is also something deeply ironic about a pure free-marketeer wanting to fix the price of a commodity (this is essentially what the gold standard is). He then says that purchasing power will adjust naturally based on production, since the money supply is fixed. I think that he's simply wrong about this since he's neglecting other forces that influence prices, but even if he's right, this proposal is insane. Production trends upward, so overall this would cause strong, but inconsistent deflation, and the dollar would be incredibly unstable due to this arbitrary balancing act between mining gold and GDP growth. This would make any kind of long term planning, like starting a business or buying a house, impossible in practice.
Paul isn't gun-shy in this book: no one is safe. Obviously the Fed is a target, but Paul goes after the SEC, the FDIC, Fannie and Freddie, the IMF, and fractional reserve banking itself. I'll leave it up to you to decide whether the elimination of all of these entities would be a good thing.
The one overarching issue with this book is the lack of empiricism. Austrians and Marxists can argue for their economic views from first principles all day and it doesn't matter, because what matters is how well a given view corresponds to reality. Empirical data is really the only way to even attempt to demonstrate this, as most other approaches devolve into a competition of rhetorical flourish and spooky anecdotes. There's no attempt to scientifically compare the pre-gold standard economy to post-gold standard economy, Paul just rails against the latter, and proves that the gold days were the glory days by throwing in a few anecdotes about the Byzantines minting coins in their heyday.
As I read the book I kept trying to figure out who the audience was supposed to be. There's an unmistakable populist message, but Paul uses a lot of terms that are basic vocabulary to economists, but would likely confuse the unfamiliar layman. I can't believe that this book was aimed at economists either. I think this book would be greatly improved by a more systematic approach, where Paul explains the problem at the beginning while defining his terms thoroughly, examines historical cases, builds his argument using empirical data, and then articulates his vision and what needs to happen to get there. I would still disagree with him and think his ideas are crazy, but at least I would have given his book a good review.
There is at least one redeeming quality in this book. I enjoyed the little anecdotes about Paul's upbringing and his interactions with other economists. I think he's a genuinely interesting guy who has been able to interact with a lot of other interesting folks. As I said in the disclaimer, I like Ron Paul. I think his biography would be an interesting read. This book, however, misses the mark pretty badly.
Further disclaimer: I like Ron Paul. I think he, like many people whose beliefs I disagree with, is a fundamentally good person who is trying to do the right thing. I'm also not opposed to crazy-sounding ideas; on the contrary, I think that the intelligent discussion of diverse ideas is a foundational pillar of our democracy.
This lengthy disclaimer exists to preemptively address those (I'm looking at you, Jake) who think that I gave this book a bad review because of my priors, or because I think Ron Paul is a crazy person, or because I never consider crazy sounding ideas. I gave this book a poor review because it's poorly written book, and here's why:
The first sign of trouble in this book is Paul overpromises to a degree that strains credulity. Essentially every good thing is caused by commodity money, and every bad thing is caused by central banks and fiat currency. According to Paul, commodity money guarantees liberty, small government, equality, world peace, continual economic growth through the elimination of recessions and the business cycle, and is endorsed by the Bible and Jesus (yes, he seriously argues this). By contrast, central bankers are a cabal of self-serving elites who use fiat money to steal your wealth, enable government handouts, usher in the rise of authoritarianism, cause wars, block international trade through tariffs, cause economic bubbles, and who caused the fall of Byzantium, enabled the rise of Hitler and are an overall source for evil. I'm obviously paraphrasing, but its an honest paraphrase; Paul actually does make each of these arguments. As a general rule, anytime someone promises a change this good and profound through one simple fix, they're wrong and you should be skeptical.
Paul's writing did little to assuage my skepticism. One of the big problems with the book is that it's all over the place in terms of structure. The book is neatly divided into chapters, but most of the content of the chapters is only loosely related to the title of the chapter. It's difficult to follow Paul's thinking systematically when he spends each chapter repeating his same denouncements of the Fed. I found this book to be jarringly repetitive, and if Paul had just focused in on the specifics and wroth about each chapter title the book would have been much better organized.
When I did identify arguments that Paul made (usually by mentally piecing together some common points he scatters throughout several different chapters), I didn't find them particularly convincing. For instance, Paul argues that the economists from the 'Austrian school' of economic thinking are unusually accurate in their future predictions regarding the economy. This would be convincing if true, but Paul doesn't give any actual evidence to support this other than some anecdotes. I doubt the anecdotes where the Austrians were wrong made it into the book. Oftentimes the Paul's explanations just seem prima facie false, and then he immediately moves on without justifying his view. Does anybody really believe that a gold standard would have solved the economic crisis in the Weimar Republic post WW1? Paul's take on that one exemplifies another problem that plagues the book: his belief that monetary solutions, namely the gold standard, will solve problems that are fundamentally fiscal in nature (although I think he makes good points of fiscal issues when he does venture there, particularly on the lack of accountability regarding the deficit).
Another issue I can think of off the top of my head is right at the end of the book where he gives his solution. He says that, on the gold standard, no new money should enter the system. This is difficult to figure, since new gold is being dug out of the ground all time time, and it seems odd to fix the money supply to the extraction rate of a particular metal. There is also something deeply ironic about a pure free-marketeer wanting to fix the price of a commodity (this is essentially what the gold standard is). He then says that purchasing power will adjust naturally based on production, since the money supply is fixed. I think that he's simply wrong about this since he's neglecting other forces that influence prices, but even if he's right, this proposal is insane. Production trends upward, so overall this would cause strong, but inconsistent deflation, and the dollar would be incredibly unstable due to this arbitrary balancing act between mining gold and GDP growth. This would make any kind of long term planning, like starting a business or buying a house, impossible in practice.
Paul isn't gun-shy in this book: no one is safe. Obviously the Fed is a target, but Paul goes after the SEC, the FDIC, Fannie and Freddie, the IMF, and fractional reserve banking itself. I'll leave it up to you to decide whether the elimination of all of these entities would be a good thing.
The one overarching issue with this book is the lack of empiricism. Austrians and Marxists can argue for their economic views from first principles all day and it doesn't matter, because what matters is how well a given view corresponds to reality. Empirical data is really the only way to even attempt to demonstrate this, as most other approaches devolve into a competition of rhetorical flourish and spooky anecdotes. There's no attempt to scientifically compare the pre-gold standard economy to post-gold standard economy, Paul just rails against the latter, and proves that the gold days were the glory days by throwing in a few anecdotes about the Byzantines minting coins in their heyday.
As I read the book I kept trying to figure out who the audience was supposed to be. There's an unmistakable populist message, but Paul uses a lot of terms that are basic vocabulary to economists, but would likely confuse the unfamiliar layman. I can't believe that this book was aimed at economists either. I think this book would be greatly improved by a more systematic approach, where Paul explains the problem at the beginning while defining his terms thoroughly, examines historical cases, builds his argument using empirical data, and then articulates his vision and what needs to happen to get there. I would still disagree with him and think his ideas are crazy, but at least I would have given his book a good review.
There is at least one redeeming quality in this book. I enjoyed the little anecdotes about Paul's upbringing and his interactions with other economists. I think he's a genuinely interesting guy who has been able to interact with a lot of other interesting folks. As I said in the disclaimer, I like Ron Paul. I think his biography would be an interesting read. This book, however, misses the mark pretty badly.
August 9, 2011
Never before have I read a book that starts out by stating, "Why you should care"; but that is exactly what Dr. Paul does with "END THE FED". He explains that the Federal Reserve has been given almost absolute power, unchecked of course, over the entire economy with little concern from Congress. Not only does Congress not care about the power of the Federal Reserve, they encourage the Fed to continue involving itself in the economy. "The Federal Reserve System must be challenged," Paul writes, "Ultimately it needs to be eliminated...No single institution in society should have power this immense. in fact, I believe that freedom itself is at stake in this struggle."
Dr. Paul continues by telling of the creation of, as G. Edward Griffin calls it, "The Creature From Jekyll Island". Which, most libertarians are aware, was formed by a small group of powerful bankers who had convinced the government that a "central bank was needed to stabilize the currency." Something the Fed has failed to do in nearly 100 years, thanks in part to fractional reserve banking, fiat currency and artificial manipulation of interest rates. A "dollar" is now worth approximately 5% of it's value in 1913, when the Fed was created; does that sound like a "stabilized currency" to you? It doesn't sound very stable to me, either. Devaluing a currency, as the Fed has done, is nothing less than fraud; just as adding water to a gallon of milk is fraud. Something Dr. Paul learned about early in life working on the family dairy.
Aside from his work on the family dairy, he credits a job with the Pittsburgh Press as helping him become interested in coin collecting. With coin collecting helping him understand the value of money. This led him later to study Mises, Hayek, Murray Rothbard, Hans F. Sennholz and Austrian Economics. it was his study of Austrian Economics along with Richard Nixon's "We're all Keynesian, now"statement and the removal of the Gold Standard that led him to become involved with politics.
Before going into details of his involvement with the Gold Commission and his interactions with Fed Chairmen; Dr. Paul spends a chapter explaining how central banks, all central banks not just the Fed, enable, encourage and fund wars, both legal and illegal, just and unjust. For the most part, all countries throughout history have been limited in how wars are financed; mainly due to have commodity based currencies. But, thanks to the advent of central banking, a government could just turn to the bank and request a large sum of money to fund whatever perceived evil lurked around the corner. The bank complies and expands the currency, reaping the benefits, and passing the cost on to the "little guy" or even worse, a future generation.
During the final days of President Carter's administration, a bill that was co-authored by Ron Paul and Jesse Helms was signed into law creating the Gold Commission. Possibly the most significant action of the Commission was a recommendation that Congress authorize the US Mint to mint a gold coin. The Congress actually authorized 4 coins; 1 ounce, ½ ounce, ¼ ounce and 1/10 ounce. These coins were minted with a legal tender face value, which has only compounded the problems associated with legal tender laws, which need to be repealed as much as the Fed needs to be abolished.
If the first third of the book was good, the last two-thirds is great!
Dr. Paul goes into detail, with transcripts of conversations he's had with both Alan Greenspan and Ben Bernanke. Of the two, at least Greenspan understands, or knows, the arguments for a Gold Standard. Yet, somehow, has lost the knowledge he had in the 1960's when he wrote an essay titled "Gold and Economic Freedom."
After writing about his "Conversations with Greenspan" and "...Bernanke"; he explains why Congress should be interested in monetary policy. One reason being that bad money and unjust taxation, including inflation, encourage the "black-market". "By destroying money and fueling the growth of the state," Paul writes, "the institution of a central bank is the biggest generator of underground criminal activity ever."
He goes on to explain "the current mess" and the Fed's "solution" of throwing more money into the market as being similar to "adding more poison to a poisoned patient amounts to a cure." And, "the current path is prolonging and extending the pain - while causing a slow death dressed up in fancy clothes."
"Why End The Fed?" Dr. Paul explains, "The Federal Reserve should be abolished because it is immoral, unconstitutional, impractical, promotes bad economics and undermines liberty. its destructive nature makes it tool of tyrannical government." The Fed has caused more "bubbles" than would have ever happened had a free market system of competing commodity-based currencies been in existence. In fact, inflation would be mostly non-existent without the Fed.
In the final chapters, Dr. Paul gives a Philosophical, Constitutional, Economic and Libertarian Case for abolishing the Fed. While each of these arguments is slightly different, they are also very similar. In short: The Fed creates inflation; inflation steals wealth from anyone who had saved some of their earnings; theft is illegal, immoral, and unjust. I'm reminded of a quote from Frederic Bastiat, "When law and morality contradict each other, the citizen has the cruel alternative of either losing his moral sense or losing his respect for the law. These two evils are of equal consequence, and it would be difficult for a person to choose between them."
In the end, Dr. Ron Paul explains "The Way Out." But, in an effort to not play the role of "spoiler" I will refrain from giving any details and end the same way Dr. Paul was greeted by 10,000 people when his "Rally for the Republic" speech began, with hopes that one day we can..."END THE FED! END THE FED! END THE FED!"
Dr. Paul continues by telling of the creation of, as G. Edward Griffin calls it, "The Creature From Jekyll Island". Which, most libertarians are aware, was formed by a small group of powerful bankers who had convinced the government that a "central bank was needed to stabilize the currency." Something the Fed has failed to do in nearly 100 years, thanks in part to fractional reserve banking, fiat currency and artificial manipulation of interest rates. A "dollar" is now worth approximately 5% of it's value in 1913, when the Fed was created; does that sound like a "stabilized currency" to you? It doesn't sound very stable to me, either. Devaluing a currency, as the Fed has done, is nothing less than fraud; just as adding water to a gallon of milk is fraud. Something Dr. Paul learned about early in life working on the family dairy.
Aside from his work on the family dairy, he credits a job with the Pittsburgh Press as helping him become interested in coin collecting. With coin collecting helping him understand the value of money. This led him later to study Mises, Hayek, Murray Rothbard, Hans F. Sennholz and Austrian Economics. it was his study of Austrian Economics along with Richard Nixon's "We're all Keynesian, now"statement and the removal of the Gold Standard that led him to become involved with politics.
Before going into details of his involvement with the Gold Commission and his interactions with Fed Chairmen; Dr. Paul spends a chapter explaining how central banks, all central banks not just the Fed, enable, encourage and fund wars, both legal and illegal, just and unjust. For the most part, all countries throughout history have been limited in how wars are financed; mainly due to have commodity based currencies. But, thanks to the advent of central banking, a government could just turn to the bank and request a large sum of money to fund whatever perceived evil lurked around the corner. The bank complies and expands the currency, reaping the benefits, and passing the cost on to the "little guy" or even worse, a future generation.
During the final days of President Carter's administration, a bill that was co-authored by Ron Paul and Jesse Helms was signed into law creating the Gold Commission. Possibly the most significant action of the Commission was a recommendation that Congress authorize the US Mint to mint a gold coin. The Congress actually authorized 4 coins; 1 ounce, ½ ounce, ¼ ounce and 1/10 ounce. These coins were minted with a legal tender face value, which has only compounded the problems associated with legal tender laws, which need to be repealed as much as the Fed needs to be abolished.
If the first third of the book was good, the last two-thirds is great!
Dr. Paul goes into detail, with transcripts of conversations he's had with both Alan Greenspan and Ben Bernanke. Of the two, at least Greenspan understands, or knows, the arguments for a Gold Standard. Yet, somehow, has lost the knowledge he had in the 1960's when he wrote an essay titled "Gold and Economic Freedom."
After writing about his "Conversations with Greenspan" and "...Bernanke"; he explains why Congress should be interested in monetary policy. One reason being that bad money and unjust taxation, including inflation, encourage the "black-market". "By destroying money and fueling the growth of the state," Paul writes, "the institution of a central bank is the biggest generator of underground criminal activity ever."
He goes on to explain "the current mess" and the Fed's "solution" of throwing more money into the market as being similar to "adding more poison to a poisoned patient amounts to a cure." And, "the current path is prolonging and extending the pain - while causing a slow death dressed up in fancy clothes."
"Why End The Fed?" Dr. Paul explains, "The Federal Reserve should be abolished because it is immoral, unconstitutional, impractical, promotes bad economics and undermines liberty. its destructive nature makes it tool of tyrannical government." The Fed has caused more "bubbles" than would have ever happened had a free market system of competing commodity-based currencies been in existence. In fact, inflation would be mostly non-existent without the Fed.
In the final chapters, Dr. Paul gives a Philosophical, Constitutional, Economic and Libertarian Case for abolishing the Fed. While each of these arguments is slightly different, they are also very similar. In short: The Fed creates inflation; inflation steals wealth from anyone who had saved some of their earnings; theft is illegal, immoral, and unjust. I'm reminded of a quote from Frederic Bastiat, "When law and morality contradict each other, the citizen has the cruel alternative of either losing his moral sense or losing his respect for the law. These two evils are of equal consequence, and it would be difficult for a person to choose between them."
In the end, Dr. Ron Paul explains "The Way Out." But, in an effort to not play the role of "spoiler" I will refrain from giving any details and end the same way Dr. Paul was greeted by 10,000 people when his "Rally for the Republic" speech began, with hopes that one day we can..."END THE FED! END THE FED! END THE FED!"
September 16, 2012
Boy, is this guy a loon. This book is mostly just a libertarian rant about the evil government, focusing mostly on the evil, evil Federal Reserve. Between his ranting, he talks about himself, his admiration for cult-leader Ayn Rand, quotes from Deuteronomy, debates he's had with Fed Chairmen, and scatters the rest with spurious economic arguments that defy the consensus of most economists, the Austrian school notwithstanding. Whenever he starts to make his arguments, I'd perk up, and then slouch again as he quickly jumps to the conclusion that Big Government is Bad and goes on another multi-page rant.
I'm amazed he doesn't even address the whole purpose of the Fed: to regulate the economy. He only says the economy is self-regulating. How?? I'd love to believe that were true, but I need something more solid than libertarian ideology. He blames all the economic bubbles on the Fed's tweaking of the interest rates, but most economists agree that this tweaking is the Fed's special sauce for preventing or at least tempering the business cycles and bubbles. It's a tough job, and they don't always get it right, but it's necessary.
Bubbles are caused by mania, the madness of crowds, not interest rate fluctuations. Paul doesn't even address this. The closest he gets is his claim that low interest rates signals the market that times are good, so people are incentivized to take more risks. Um, what about the banks paying off the rating agencies to call their toxic loans Aaa prime, while the government turned a blind eye? The problem isn't too much government oversight, but too little. Even most Republicans begrudgingly admitted this, after this latest bubble.
His solution to all problems is the gold standard. Um, been there, done that. Economists know the gold standard forced the interest rates to go up during the Depression, only prolonging the agony.
He makes a good point that the Federal Reserve was not allowed by the Constitution, but the Constitution is not a static document. It tasks the Supreme Court with the job of interpreting it, and the Supreme Court has ruled that the Fed is legal.
I've found Ron Paul's debates in the Republican Primaries refreshing. I'm so grateful he's out there talking about the things nobody wants to face. Yes, inflation is an invisible tax. Yes, the government uses this to create money from thin air and hands it out to its corporate friends. Yes, inflation is used to fund wars. Yes, the government has been on a spending spree for decades and can't seem to stop. But I find it damn frustrating that, the second he starts talking sense, pointing out the elephant in the room, he takes it to its logical extreme and starts sounding completely out-of-touch with reality, thereby invalidating his otherwise valid points.
I'm amazed he doesn't even address the whole purpose of the Fed: to regulate the economy. He only says the economy is self-regulating. How?? I'd love to believe that were true, but I need something more solid than libertarian ideology. He blames all the economic bubbles on the Fed's tweaking of the interest rates, but most economists agree that this tweaking is the Fed's special sauce for preventing or at least tempering the business cycles and bubbles. It's a tough job, and they don't always get it right, but it's necessary.
Bubbles are caused by mania, the madness of crowds, not interest rate fluctuations. Paul doesn't even address this. The closest he gets is his claim that low interest rates signals the market that times are good, so people are incentivized to take more risks. Um, what about the banks paying off the rating agencies to call their toxic loans Aaa prime, while the government turned a blind eye? The problem isn't too much government oversight, but too little. Even most Republicans begrudgingly admitted this, after this latest bubble.
His solution to all problems is the gold standard. Um, been there, done that. Economists know the gold standard forced the interest rates to go up during the Depression, only prolonging the agony.
He makes a good point that the Federal Reserve was not allowed by the Constitution, but the Constitution is not a static document. It tasks the Supreme Court with the job of interpreting it, and the Supreme Court has ruled that the Fed is legal.
I've found Ron Paul's debates in the Republican Primaries refreshing. I'm so grateful he's out there talking about the things nobody wants to face. Yes, inflation is an invisible tax. Yes, the government uses this to create money from thin air and hands it out to its corporate friends. Yes, inflation is used to fund wars. Yes, the government has been on a spending spree for decades and can't seem to stop. But I find it damn frustrating that, the second he starts talking sense, pointing out the elephant in the room, he takes it to its logical extreme and starts sounding completely out-of-touch with reality, thereby invalidating his otherwise valid points.
December 30, 2018
I have had this book on my list for quite some time as there is another book I wanted to read first. But I never seemed to get around to reading that one so I decided to just go ahead with End th Fed! Ron Paul lays out a logical analysis of the Fed's power, organization, and functional operations. He explains how, rather than smoothing out volitility in the markets, it often causes or exacerbates problems at the expense of consumers and to the benefit of banks and politicians. While I am not sure I agree with everything he presents here, I do think he makes many solid and logical arguments. As to whether the Fed will ever be ended, we'll have to wait and see. Everyone who follows or worries about what is happening to the markets and the effects on regular folks should read this book.
August 3, 2011
Paul spends a lot of time criticizing the Fed (and rightly so) but offers little else in between his bouts of autobiographical reminiscing. Returning to a gold standard is his solution, but he provides no framework on how to do so. Paper money and credit are fictitious he argues, but I would even argue that so is gold. Yes, among all the elements on the periodic table it is rare, but it only has value because we believe it has value - just like the paper (actually cloth) and bits of non-precious metals in our pockets. Ask any historian, anthropologist, or archeologist for examples of cultures that didn't value gold the way we do and you'll find plenty. I do not recommend this as a productive read. No stars.
April 25, 2012
not engaging writing style, badly written in general. Content, while perhaps interesting in different prose, was not enough to redeem this book.
November 25, 2023
A very worthy cause that I support. The writing left something to be desired though as much of it felt either scattered or redundant.
March 4, 2010
Scary. China's inflation is the residual effect of our inflation; we are consumers to them; no longer are we producing--so what happens when China's bubble bursts (it will in six months to a year, maybe two, just as our housing bubble burst within six years of its making...we can't afford their commodities, and we are their strongest demand...ie look at all your kitchen product brand names. Consider China's population and tolitarian state. Consider its negotiations with the ME for a new currency, and perhaps Euro, as justifiably Greece just did today, rather than the dollar). Consider Russia's disdain for the US, siding with Iran when the gold standard inevitably will come into play. In the near, near future, China will need its money back. Temporarily, for reassurance, in case the stimulas plan backfires (which it will due to the FED's insistance on maintaining private ownership and insolvent deals with big corp. they will be unable to justify, or pay back) the US will soon heed to a Chinese 'eminent domain' on American soil. We will be unable to pay any of our debt, maybe some, but hardly sufficient. And so the Chinese, along with Russia and the Middle East invade the US, maybe disguised,maybe not...
So what then? When the US is inundated with debt to our Chinese bank that depends on the dollar that no longer exists? What happens when a business declares bankruptcy?
Long story short--DMV sized lines for rice and water: two/five years. Five/seven years, US banks closed, gone. Dollar is dead. Banks shut down. Civil unrest, not just in the US, but globally.
Paul's point : Edit the FED now, rather than later, because later, according to all the reputable sources he quotes, will mean the the United States will, indee become a third world country at best, if not bought state by state (depending on each state's deficit, agriculture, resources,etc) by other nations.
At least the great depression wasn't global... yikes. The congressman, from what I gather, has no intention other than to inform, so his proclivity for honesty is seldom rebutted by the genius economists of our time, only rebutted by the right wing (and the left: note the dire need for health care reform. Briefly as a cliffnot, health care will help lower our deficit and dependence on big business)...owned by guess who? Global big business. Personified by President Bush's new land ownership in South America? Why would a former president purchase thousands upon thousands of acres in Paraguay?
The constitution had its merits, if only, claims Paul, we would have abided by it.
So what then? When the US is inundated with debt to our Chinese bank that depends on the dollar that no longer exists? What happens when a business declares bankruptcy?
Long story short--DMV sized lines for rice and water: two/five years. Five/seven years, US banks closed, gone. Dollar is dead. Banks shut down. Civil unrest, not just in the US, but globally.
Paul's point : Edit the FED now, rather than later, because later, according to all the reputable sources he quotes, will mean the the United States will, indee become a third world country at best, if not bought state by state (depending on each state's deficit, agriculture, resources,etc) by other nations.
At least the great depression wasn't global... yikes. The congressman, from what I gather, has no intention other than to inform, so his proclivity for honesty is seldom rebutted by the genius economists of our time, only rebutted by the right wing (and the left: note the dire need for health care reform. Briefly as a cliffnot, health care will help lower our deficit and dependence on big business)...owned by guess who? Global big business. Personified by President Bush's new land ownership in South America? Why would a former president purchase thousands upon thousands of acres in Paraguay?
The constitution had its merits, if only, claims Paul, we would have abided by it.
November 27, 2009
Let me preface my review by saying that this is my first introduction to Congressman Paul's written work, and so I must focus my observations on his conclusions to the scope of this book and its topic - the Federal Reserve, it's history, and the case for its disbandment.
Where this book succeeds is as an impassioned and very convincing elucidation on the fraudulent nature of the fiat capital system and the undeserving mystique that surrounds it. Paul's approach is direct and to the point, and certainly does not patronize the reader in an earnest attempt to play utterly fair. His view is also patently "big tent" and does not focus in on any one party identity as the cause of social ills. Instead, he argues, and after some examination of his points, that the system of fiat money is directly to blame of the social environ that gives rise to much public injustice. With the wealth of good argument supplied, the undecided reader will likely agree with this point.
What the book is not, however, is a detailed blueprint as to what kind of monetary system could practically replace the current unjust fiat system and how such a system could be enacted, and that is sorely wanted for as one works though all the reasons the current system is invalid. Paul is very educated on his subject, and the sources he cites, among them famous Austrian School Economists that he identifies as personal heroes, are included in the book. I find it unlikely that he does not have a feasible replacement in mind or that he is incapable of clearly sharing it in his book - it would rather seem that his zeal and agitation to discount the current system have lead to a book that dedicates every chapter save one to negative didactic rather than constructing a replacement. By the time you are utterly convinced, you are craving an explanation of the intended new direction that is as detailed as the section dedicated on attacking the current - and instead only one chapter is provided.
Paul is an admirably honest voice, and he has done the American individual a favor by giving us this book. I sincerely hope that he continues in his struggle, as it at the very least stimulates a much needed dialogue in this country. Just taking this work on its own merits as a roadmap to sound money however, it could do with more Rousseau and less Cato the Elder.
Where this book succeeds is as an impassioned and very convincing elucidation on the fraudulent nature of the fiat capital system and the undeserving mystique that surrounds it. Paul's approach is direct and to the point, and certainly does not patronize the reader in an earnest attempt to play utterly fair. His view is also patently "big tent" and does not focus in on any one party identity as the cause of social ills. Instead, he argues, and after some examination of his points, that the system of fiat money is directly to blame of the social environ that gives rise to much public injustice. With the wealth of good argument supplied, the undecided reader will likely agree with this point.
What the book is not, however, is a detailed blueprint as to what kind of monetary system could practically replace the current unjust fiat system and how such a system could be enacted, and that is sorely wanted for as one works though all the reasons the current system is invalid. Paul is very educated on his subject, and the sources he cites, among them famous Austrian School Economists that he identifies as personal heroes, are included in the book. I find it unlikely that he does not have a feasible replacement in mind or that he is incapable of clearly sharing it in his book - it would rather seem that his zeal and agitation to discount the current system have lead to a book that dedicates every chapter save one to negative didactic rather than constructing a replacement. By the time you are utterly convinced, you are craving an explanation of the intended new direction that is as detailed as the section dedicated on attacking the current - and instead only one chapter is provided.
Paul is an admirably honest voice, and he has done the American individual a favor by giving us this book. I sincerely hope that he continues in his struggle, as it at the very least stimulates a much needed dialogue in this country. Just taking this work on its own merits as a roadmap to sound money however, it could do with more Rousseau and less Cato the Elder.
February 18, 2017
"The longer we delay a conversion to sound money and away from central banking, the worse our crisis will grow and the more government will expand at the expense of our liberties." p.70 Ron Paul details in his book: END THE FED that our elastic money system is bringing us to a point of no return. The continued practice of increasing our money supply is debasing our dollar, placing us greater in debt and making us, the people, lose our liberty.
The fiat dollar takes away our liberty because our wealth is dependent upon the stability of the Federal Government. If the government would default or if our government would falter our money wouldn't be worth the paper it was printed-on. Our paper money has no intrinsic value such as gold and/or silver. Thus, we are slaves to a currency that is created out of thin air. The only safeguard we currently have is the competitive values of other world currencies. However, if there would ever become one world currency that slim safeguard would be gone as well.
END THE FED is not a partisan issue since our nation's economy affects all of us. It less affects the super wealthy and the "friends of the Fed" seeing the Fed will just bail these institutions out such as they did in the 2008 housing crisis. However, in the end, it will affect all when you have a populace that can no longer make purchases making productivity fall to a point that a nation's economy stops. That's the thing, if a nation does not have products to sell or to be bought the amount of money held becomes non essential.
The Fed is more than a private institution, as many believe. It is better than "...being private. It's sanctioned by the government, protected by the government, and has the privilege of total secrecy." p.172 We as citizens have an institution with immense power yet non of the Fed's officials including its chairman are elected by any electorate. How is this American? There is hardly anything disclosed about the deals The Fed makes with other central banks, who The Fed bails-out and which "friends" of The Fed are treated better than others.
Americans should be outraged about the practices and powers of The Fed, but sadly most are oblivious to the true power of The Fed. Also, most would be, at first glance, open to a debt-based economy where The Fed just creates a greater money supply that has only a nominal value seeing at first the majority get something for fee. But eventually, the people will pay with a depression and bankruptcy. It's like a person that has a disease and is given morphine. Yes, the patient feels good and thinks he is getting better all the while the disease is eating the patient away from the inside until the patient dies.
Most people, I myself included until I read this book, do not even know our current money system is unConstitutional! The Constitution does not even speak on having a central bank. Article I Section X: No state shall ...make anything but gold and silver coin tender in payment of debts. But the Supreme Court in McCulloch v. Maryland cited Article I Section VIII where it states the Congress may make any law it deems necessary.
The Fed and it's printing of paper money, however, is not a law it is power the Congress granted. The Tenth Amendment states: "if a power is not 'delegated to the United States by the Constitution,' it doesn't exist. So by circumventing the Constitution i.e. The Law of the Land the architects of the First, Second and Third Central Bank created the means to have the nation's money system serve them.
Ron Paul points to the example of the nineteenth century when there was no central bank. Dr. Paul explains this was one of the most explosive times of productivity increase in the history of the world. Moreover, he states life in a non-central bank world would force money and banking to operate like any other business where they would be "...subject to profit and loss tests and punished rewarded in the market based on consumer behavior." p.191
In my opinion, every American should read this book since it is not a partisan political issue, but an issue that affects all Americans. Americans should be woken-up to the eventual calamity our fiat dollar system poses. I gave this book four stars and not five because it illustrates the terrible problems and dangers especially to the Middle Class and Poor in this Country that having a central bank brings to these two major classes in our society.
I would have like if Dr. Paul would have outlined if we as a nation would be able to continue as a global power and how we would have the ability to defend ourselves in the many reaches of world when it comes to global terrorism. Would we continue to be able to be a balance of power of the world or would become more of a protectionist nation? We are able to drive the American military to fight terrible aggression in the world such as we did in World War I because we had a fiat dollar system.
In END THE FED Dr. Paul writes: "In total, scholars have estimated that only 21 percent of the war was funded through taxation. The remainder was funded by Fed-backed borrowing (56 percent) and outright money creation (23 percent), for a total cost of $33 billion." p.66 So, I would question if a need for an extensive war arose where we virtually had no choice to fight it how would we finance it without a central banking system? I would have liked for Dr. Paul to go in greater detail concerning this. Also, if we were to end the Fed how would be go about doing it? What would the steps actually be to return to a "sound money" system, and what would the impact immediately be? For these unanswered questions is why I gave the book four stars as opposed to five.
What is certain is that with a $19 trillion dollar debt that is growing by the day and our real money value plummeting we need to do something before the bottom falls-out and there is no way back. I don't necessarily believe we need to go to a gold standard seeing money is just a means of exchange for products and services. For example, I know for centuries people in England used tally sticks that were nothing more than sticks of wood where notices were placed to recognize transactions and that these tally sticks were quite effective. But I do know we need to be not accepting of the medication but be wanting the cure for the disease of fake money.
1913 $1 = $21. 2009 Banking cartel & Governement have stolen $.95 of every $1. p.25
In 2009, day-to-day bank credit has increased at rate of 22%. Now, the U.S. is the biggest debtor in the world. $1.5 foreign debt, 20% of GDP. p.83
5th Plank of Marx's COMMUNIST MANIFESTO: "Centralization of credit in the banks of the State, by means of a national bank with state capital and an exclusive monopoly." p.142
"People are no longer free to move and change jobs. They are enslaved to their high credit card debt, the college loans, their car and home loans. None of these institutions and this type of personal fiduciary bondage was not known before the Fed." pp.151-152
This is so true! From the time we are kids most of us are conditioned by our parents to live in debt whether it is to take out a loan for a house or a car. And this continues through life whether it is putting items on layaway or to take-out a student loan for school. Then the cycle repeats when we become adults and teach the same bad in debt lessons to our children. We become conditioned to the false fact that we are supposed to live in debt. It is madness!
The fiat dollar takes away our liberty because our wealth is dependent upon the stability of the Federal Government. If the government would default or if our government would falter our money wouldn't be worth the paper it was printed-on. Our paper money has no intrinsic value such as gold and/or silver. Thus, we are slaves to a currency that is created out of thin air. The only safeguard we currently have is the competitive values of other world currencies. However, if there would ever become one world currency that slim safeguard would be gone as well.
END THE FED is not a partisan issue since our nation's economy affects all of us. It less affects the super wealthy and the "friends of the Fed" seeing the Fed will just bail these institutions out such as they did in the 2008 housing crisis. However, in the end, it will affect all when you have a populace that can no longer make purchases making productivity fall to a point that a nation's economy stops. That's the thing, if a nation does not have products to sell or to be bought the amount of money held becomes non essential.
The Fed is more than a private institution, as many believe. It is better than "...being private. It's sanctioned by the government, protected by the government, and has the privilege of total secrecy." p.172 We as citizens have an institution with immense power yet non of the Fed's officials including its chairman are elected by any electorate. How is this American? There is hardly anything disclosed about the deals The Fed makes with other central banks, who The Fed bails-out and which "friends" of The Fed are treated better than others.
Americans should be outraged about the practices and powers of The Fed, but sadly most are oblivious to the true power of The Fed. Also, most would be, at first glance, open to a debt-based economy where The Fed just creates a greater money supply that has only a nominal value seeing at first the majority get something for fee. But eventually, the people will pay with a depression and bankruptcy. It's like a person that has a disease and is given morphine. Yes, the patient feels good and thinks he is getting better all the while the disease is eating the patient away from the inside until the patient dies.
Most people, I myself included until I read this book, do not even know our current money system is unConstitutional! The Constitution does not even speak on having a central bank. Article I Section X: No state shall ...make anything but gold and silver coin tender in payment of debts. But the Supreme Court in McCulloch v. Maryland cited Article I Section VIII where it states the Congress may make any law it deems necessary.
The Fed and it's printing of paper money, however, is not a law it is power the Congress granted. The Tenth Amendment states: "if a power is not 'delegated to the United States by the Constitution,' it doesn't exist. So by circumventing the Constitution i.e. The Law of the Land the architects of the First, Second and Third Central Bank created the means to have the nation's money system serve them.
Ron Paul points to the example of the nineteenth century when there was no central bank. Dr. Paul explains this was one of the most explosive times of productivity increase in the history of the world. Moreover, he states life in a non-central bank world would force money and banking to operate like any other business where they would be "...subject to profit and loss tests and punished rewarded in the market based on consumer behavior." p.191
In my opinion, every American should read this book since it is not a partisan political issue, but an issue that affects all Americans. Americans should be woken-up to the eventual calamity our fiat dollar system poses. I gave this book four stars and not five because it illustrates the terrible problems and dangers especially to the Middle Class and Poor in this Country that having a central bank brings to these two major classes in our society.
I would have like if Dr. Paul would have outlined if we as a nation would be able to continue as a global power and how we would have the ability to defend ourselves in the many reaches of world when it comes to global terrorism. Would we continue to be able to be a balance of power of the world or would become more of a protectionist nation? We are able to drive the American military to fight terrible aggression in the world such as we did in World War I because we had a fiat dollar system.
In END THE FED Dr. Paul writes: "In total, scholars have estimated that only 21 percent of the war was funded through taxation. The remainder was funded by Fed-backed borrowing (56 percent) and outright money creation (23 percent), for a total cost of $33 billion." p.66 So, I would question if a need for an extensive war arose where we virtually had no choice to fight it how would we finance it without a central banking system? I would have liked for Dr. Paul to go in greater detail concerning this. Also, if we were to end the Fed how would be go about doing it? What would the steps actually be to return to a "sound money" system, and what would the impact immediately be? For these unanswered questions is why I gave the book four stars as opposed to five.
What is certain is that with a $19 trillion dollar debt that is growing by the day and our real money value plummeting we need to do something before the bottom falls-out and there is no way back. I don't necessarily believe we need to go to a gold standard seeing money is just a means of exchange for products and services. For example, I know for centuries people in England used tally sticks that were nothing more than sticks of wood where notices were placed to recognize transactions and that these tally sticks were quite effective. But I do know we need to be not accepting of the medication but be wanting the cure for the disease of fake money.
1913 $1 = $21. 2009 Banking cartel & Governement have stolen $.95 of every $1. p.25
In 2009, day-to-day bank credit has increased at rate of 22%. Now, the U.S. is the biggest debtor in the world. $1.5 foreign debt, 20% of GDP. p.83
5th Plank of Marx's COMMUNIST MANIFESTO: "Centralization of credit in the banks of the State, by means of a national bank with state capital and an exclusive monopoly." p.142
"People are no longer free to move and change jobs. They are enslaved to their high credit card debt, the college loans, their car and home loans. None of these institutions and this type of personal fiduciary bondage was not known before the Fed." pp.151-152
This is so true! From the time we are kids most of us are conditioned by our parents to live in debt whether it is to take out a loan for a house or a car. And this continues through life whether it is putting items on layaway or to take-out a student loan for school. Then the cycle repeats when we become adults and teach the same bad in debt lessons to our children. We become conditioned to the false fact that we are supposed to live in debt. It is madness!
December 23, 2011
I began reading this book in a desparate effort to understand Ron Paul and why he's so popular. I can honestly say, I still have no idea why he's so popular. He makes a good case, at the very least, for how it's a Dual Relationship the Federal Reserve has with the Federal Government. Definitly a conflict of interest. He also makes a good point that when the Fed simply makes more money, inflation sky rockets, and somehow the Fed is left unaccountable. So, while he does make some great points, and I enjoyed the historical part of the book, I was not a real fan of all the economic information. It's an great read, if you're 1). into history, 2). into economics and 3). the government trying to get out of accountability. If you like two of those things, it's a good read. If you like one of them (as in my case), it's ok. I simply will never understand Ron Paul's popularity.
December 4, 2012
Makes some great points, but fails to ultimately delve deep enough into the "End the Fed" arguments made and popularized by its own author. Nevertheless, it does give more detailed accounts of some events and touches on more of Dr. Paul's philosophies and influences that tantalize his admirers.
Readers looking for an academic account or argument for ending the fed, will be left wanting, while those new to the subject may find some reasons for giving the movement some credit.
Readers looking for an academic account or argument for ending the fed, will be left wanting, while those new to the subject may find some reasons for giving the movement some credit.
January 13, 2010
A persuasive, multi-pronged argument on why the Federal Reserve is bad for America; it allows for an arbitrary, hidden, regressive tax that allows the government to fund wars and redistribution, and destabilizes the economy by promoting unsustainable growth ending in busts like the recent housing market crash.
March 28, 2012
This book was a disappointment. I was trying to find out why Ron Paul wants to end the fed and was hoping for a reasoned logical presentation of his point of view. All I got were statements that were not supported and could be proved to be wrong. He writes like he talks--all over the lot
September 28, 2010
Shouldve been a 10 page essay/pamphlet
December 24, 2011
End The Fed by Ron Paul
I first developed an interest in politics after 9/11. Why on earth would someone hate America that much, I wondered? Who is al qaida? What the hell is their problem with us? So I began paying attention to politics, U.S. foreign affairs in particular. During the Bush/Cheney march to war in Iraq in 2002 I was tuned in and I watched in amazemenat as that administration fed the American public one line of bullshit after another. I mean I was all for getting rid of Saddam, but what I was not for was being lied to. And it was so obvious to me that the Bush/Cheney Administration were lying out their asses. So it was a relief when ole Barack Obama, a local Chicago poltician, came onto the scene, for he also saw that the Bush/Cheney Administration was lying out their asses and that he spoke out against them. The Bush/Cheney war was not about Saddam's violation of human rights, or about national security and WMDs. It was about oil and geo-political influence. And as I watched the 2004 Presidential election, the Bush/Cheney lies just continued. Cheney was obviously evil. W was a retard, yet Kerry/Edwards didn't inspire me to drive to my local voting place, wait in line and cast a vote either. They just didn't seem like they would make things drastically any better.
How can you be so interested in politics yet not vote? People would ask me. I wasn't sure. It just didn't seem like it was worth my time. I would lamely argue that Illinois always votes Democrat anyway, so my vote wouldnt really make a difference. Plus I dont agree with the electoral college system. Why not one person = one vote? But honestly, the main reason was because the root of what I thought was wrong with our corporate-political economic system was not going to be solved by any of these candidates. No one was speaking out for what I wanted. I wanted to live in a nation that put an emphasis on Ethics, honesty, transparency, and basic human decency. I wanted to live in an America where not ONE single corporation polluted the environment or rushed untested drugs that damaged people onto the market. I wanted to live in an America where every single child had equal educational opportunities and health care. I wanted to live in an America where the economic system did not reward greed.
When 2008 rolled around, I chose not to vote once again. I was glad Obama won, but I didn't think he was going to overhaul our entire system. And in 2009 when he made sure that the "too big to fail" financial institutions got a multi-billion dollar bail out, it felt like he was just more of the same old, same old.
Which brings us to 2012. For a few years now I had been listening to talk radio regularly--both left-wing stations and right-wing ones. I had spent the last few months of 2011 watching the Occupy Wall Street folks with interest--but I couldnt help but think that they had no chance of drastically changing the system. They might accomplish something positive, some small step in the right direction, but nothing revolutionary. And I also watched in waning interest as the Republican Party went through the fiasco of trying to nominate a Presidental candidate--a process that resembled mentally handicapped people playing musical chairs All of which led me to the the notion that most likely Obama would have 4 more years--4 more years with which he might hopefully do some positive things, especially in the area towards building a greener infrastructure. But still I did not see anything revolutionary on the horizon, nothing that would begin to tear down the corrupt corporate political system that governed our nation. And it was beginning to look as though the 2012 Presidential election was going to be the same old typical bull shit, with nothing of interest in terms of real change being injected into the national debate. But then...
Enter Ron Paul
Ron Paul is not a new name in the presidential campaign. He ran in 1988 and 2008 with pretty much the same Libertarian message as he has today. But for the first time, he actually has a chance of actually interjecting this message into the national conversation. For the first time Paul is looking like he is about to enter the national spotlight as he is now poised as an honest contender to win the first Republican contest in Iowa. The time for his message to be heard, might have finally come.
The centerpiece of Paul's message is that our nation needs to phase out the Federal Reserve System. To get a more detailed picture of this argument I picked up a copy of his 2009 book End the Fed. On page 4 of End the Fed Ron Paul writes "...I think the system of Fed domination must come to an end." On page 11 he goes on to write, "The Federal Reserve System must be challenged. Ultimately, it needs to be eliminated."
Now that is what I call a revolutionary idea. Paul does not come right out and say that we need to get rid of Federal money or even get rid of a Federal Bank, but he does say that we need to get rid of the Federal Reserve System. Paul then goes on to lay out the more than just a few gripes he has with the Fed system. He thinks that no single institution in society should have a monopoly on money. It puts too much power in the hands of the Federal Government. He also doesn't like the idea that the U.S. government can just print money out of thin air in order to (directly or indirectly) generate funds for its agenda and policies--whether that agenda be a war for oil in Iraq, or universal healthcare, or financial aid to victims of Katrina, or building and repairing the nation's infrastructure. Paul also argues that having a Federal Reserve allows banks to provide risky loans. And that it also provides banks with 'elasticity' (the ability to expand money and credit as much as they want to). The Fed, as Paul sees it, is in the business of generating inflation. In fact since the creation of the Federal Reserve in 1913 the worth of the dollar has shrunk to just 5 cents.
The reason, Paul argues, that the Fed can do all these things is because of "the institution of fractional reserves" -- in other words the mixing of the two distinct functions of the bank. The first function of a bank is simply the warehousing of money whereas the second function is providing a loan service. When the warehousing of money becomes a source of lending that is considered as mixing the two distinct functions of a bank (a.k.a. the fractional reserve sytsem). As the Fed relies heavily on fractional reserves, "using the banking system as the engine through which new money is injected into the economy as a whole" and then backs this fractional reserve system with the promise of endless money creation and bailouts, it perpetuates an illusion, according to Paul. Paul labels this system as half-socialized--"propped up by the government". It is a system that was created by the establishment of the Federal Reserve in 1913 by "powerful bankers with powerful government officials working together to have the nation's money serve their interests..." The Fed was designed to benefit the rich and poweful and that is what it has done for the last hundred years, continually making the rich even richer and expanding the gap between the 1%ers and the rest of us.
So if the Fed is so bad, then why not get rid of it, as Paul urges?
Right Here, Right Now
The one major problem with free market capitalism is that it doesn't concern itself with humanity. It simply does not calculate humanity into the equation at all. It ignores humanity--which is why free market proponents come off as so callous: they have dehumanized us. They think only in terms of monetary concerns, the bottom line. And this is why free-market capitalism will never work. It is why we have Ron Paul and Libertarians making callous comments about victims of Katrina, or about victums of large corporate drug companies who have rushed untested drugs onto the market. It is why they do not seem concerned about children who have gotten cancer due to chemicals that nearby factories dump into the land, air and water in their neighborhoods. The government shouldn't regulate these corporations--you have to let the free market determine everything and fuck the people who get bulled over by the wave of free-market enterprise, for people are not important. Only corporations are important. They are all that matters.
And this is why true free-market capitalism has never worked and never will work. We say we have a capitalistic system, but the truth is--as Ron Paul says, we have a half-socialized system, a half-capitialistic system. Which is actually a good thing. If you pit capitalism against communism, neither one actually takes into account the realistic influences of human nature. In a strictly communist society, with no economic motive to get ahead, there will be people who simply will not contribute, people who will be motivated NOT to work. Why should they go out and bust their ass when their food and shelter is provided for them? There will also be those who form a black market, there will be those who get ahead through corruption. Likewise, a strictly capitalistic society, falls victim to human vices as well. Those with power and money and access to power and money create machinations that perpetuate their access to power and money and that discriminate in order to further deny that access to others. This is why there are no truly capitalistic societies nor any truly communistic societies in the world. What we have are systems that are various combinations of the two, and that are in continual flux, teeter-tottering back and forth, leaning toward one or the other at all times. In the U.S for example, for every shift toward communism (like the New Deal in the 1930 or the Great Society in the 1960s) we see a counter-shift toward capitialism (like in the Eisenhower Era and Reagan Era). At times however, these battles are very complex and colored in nuance. Today for instance, we are seeing that the capitalisitic shift during the Bush/Cheney that was camoflauged in smoke and mirrors is being countered with a communistic shift of the ObamaCare era that is equally as nuanced, complicated and camoflauged in smoke and mirrors.
Which brings us back to Ron Paul and his effort to shift America back towards capitalism--which is really what his 'End the Fed' ideology is all about. Does America need a shift towards free-market capitalism right now? Or do we need to continue shifting towards socialism? Is there some way to restructure the Federal Reserve System? What would happen if we stopped bailing out the "too big to fail" financial institutions? In the long run would that be better for America? Wouldn't it be more fair?
Maybe there is hope for this year's Presidential Election after all...
I first developed an interest in politics after 9/11. Why on earth would someone hate America that much, I wondered? Who is al qaida? What the hell is their problem with us? So I began paying attention to politics, U.S. foreign affairs in particular. During the Bush/Cheney march to war in Iraq in 2002 I was tuned in and I watched in amazemenat as that administration fed the American public one line of bullshit after another. I mean I was all for getting rid of Saddam, but what I was not for was being lied to. And it was so obvious to me that the Bush/Cheney Administration were lying out their asses. So it was a relief when ole Barack Obama, a local Chicago poltician, came onto the scene, for he also saw that the Bush/Cheney Administration was lying out their asses and that he spoke out against them. The Bush/Cheney war was not about Saddam's violation of human rights, or about national security and WMDs. It was about oil and geo-political influence. And as I watched the 2004 Presidential election, the Bush/Cheney lies just continued. Cheney was obviously evil. W was a retard, yet Kerry/Edwards didn't inspire me to drive to my local voting place, wait in line and cast a vote either. They just didn't seem like they would make things drastically any better.
How can you be so interested in politics yet not vote? People would ask me. I wasn't sure. It just didn't seem like it was worth my time. I would lamely argue that Illinois always votes Democrat anyway, so my vote wouldnt really make a difference. Plus I dont agree with the electoral college system. Why not one person = one vote? But honestly, the main reason was because the root of what I thought was wrong with our corporate-political economic system was not going to be solved by any of these candidates. No one was speaking out for what I wanted. I wanted to live in a nation that put an emphasis on Ethics, honesty, transparency, and basic human decency. I wanted to live in an America where not ONE single corporation polluted the environment or rushed untested drugs that damaged people onto the market. I wanted to live in an America where every single child had equal educational opportunities and health care. I wanted to live in an America where the economic system did not reward greed.
When 2008 rolled around, I chose not to vote once again. I was glad Obama won, but I didn't think he was going to overhaul our entire system. And in 2009 when he made sure that the "too big to fail" financial institutions got a multi-billion dollar bail out, it felt like he was just more of the same old, same old.
Which brings us to 2012. For a few years now I had been listening to talk radio regularly--both left-wing stations and right-wing ones. I had spent the last few months of 2011 watching the Occupy Wall Street folks with interest--but I couldnt help but think that they had no chance of drastically changing the system. They might accomplish something positive, some small step in the right direction, but nothing revolutionary. And I also watched in waning interest as the Republican Party went through the fiasco of trying to nominate a Presidental candidate--a process that resembled mentally handicapped people playing musical chairs All of which led me to the the notion that most likely Obama would have 4 more years--4 more years with which he might hopefully do some positive things, especially in the area towards building a greener infrastructure. But still I did not see anything revolutionary on the horizon, nothing that would begin to tear down the corrupt corporate political system that governed our nation. And it was beginning to look as though the 2012 Presidential election was going to be the same old typical bull shit, with nothing of interest in terms of real change being injected into the national debate. But then...
Enter Ron Paul
Ron Paul is not a new name in the presidential campaign. He ran in 1988 and 2008 with pretty much the same Libertarian message as he has today. But for the first time, he actually has a chance of actually interjecting this message into the national conversation. For the first time Paul is looking like he is about to enter the national spotlight as he is now poised as an honest contender to win the first Republican contest in Iowa. The time for his message to be heard, might have finally come.
The centerpiece of Paul's message is that our nation needs to phase out the Federal Reserve System. To get a more detailed picture of this argument I picked up a copy of his 2009 book End the Fed. On page 4 of End the Fed Ron Paul writes "...I think the system of Fed domination must come to an end." On page 11 he goes on to write, "The Federal Reserve System must be challenged. Ultimately, it needs to be eliminated."
Now that is what I call a revolutionary idea. Paul does not come right out and say that we need to get rid of Federal money or even get rid of a Federal Bank, but he does say that we need to get rid of the Federal Reserve System. Paul then goes on to lay out the more than just a few gripes he has with the Fed system. He thinks that no single institution in society should have a monopoly on money. It puts too much power in the hands of the Federal Government. He also doesn't like the idea that the U.S. government can just print money out of thin air in order to (directly or indirectly) generate funds for its agenda and policies--whether that agenda be a war for oil in Iraq, or universal healthcare, or financial aid to victims of Katrina, or building and repairing the nation's infrastructure. Paul also argues that having a Federal Reserve allows banks to provide risky loans. And that it also provides banks with 'elasticity' (the ability to expand money and credit as much as they want to). The Fed, as Paul sees it, is in the business of generating inflation. In fact since the creation of the Federal Reserve in 1913 the worth of the dollar has shrunk to just 5 cents.
The reason, Paul argues, that the Fed can do all these things is because of "the institution of fractional reserves" -- in other words the mixing of the two distinct functions of the bank. The first function of a bank is simply the warehousing of money whereas the second function is providing a loan service. When the warehousing of money becomes a source of lending that is considered as mixing the two distinct functions of a bank (a.k.a. the fractional reserve sytsem). As the Fed relies heavily on fractional reserves, "using the banking system as the engine through which new money is injected into the economy as a whole" and then backs this fractional reserve system with the promise of endless money creation and bailouts, it perpetuates an illusion, according to Paul. Paul labels this system as half-socialized--"propped up by the government". It is a system that was created by the establishment of the Federal Reserve in 1913 by "powerful bankers with powerful government officials working together to have the nation's money serve their interests..." The Fed was designed to benefit the rich and poweful and that is what it has done for the last hundred years, continually making the rich even richer and expanding the gap between the 1%ers and the rest of us.
So if the Fed is so bad, then why not get rid of it, as Paul urges?
Right Here, Right Now
The one major problem with free market capitalism is that it doesn't concern itself with humanity. It simply does not calculate humanity into the equation at all. It ignores humanity--which is why free market proponents come off as so callous: they have dehumanized us. They think only in terms of monetary concerns, the bottom line. And this is why free-market capitalism will never work. It is why we have Ron Paul and Libertarians making callous comments about victims of Katrina, or about victums of large corporate drug companies who have rushed untested drugs onto the market. It is why they do not seem concerned about children who have gotten cancer due to chemicals that nearby factories dump into the land, air and water in their neighborhoods. The government shouldn't regulate these corporations--you have to let the free market determine everything and fuck the people who get bulled over by the wave of free-market enterprise, for people are not important. Only corporations are important. They are all that matters.
And this is why true free-market capitalism has never worked and never will work. We say we have a capitalistic system, but the truth is--as Ron Paul says, we have a half-socialized system, a half-capitialistic system. Which is actually a good thing. If you pit capitalism against communism, neither one actually takes into account the realistic influences of human nature. In a strictly communist society, with no economic motive to get ahead, there will be people who simply will not contribute, people who will be motivated NOT to work. Why should they go out and bust their ass when their food and shelter is provided for them? There will also be those who form a black market, there will be those who get ahead through corruption. Likewise, a strictly capitalistic society, falls victim to human vices as well. Those with power and money and access to power and money create machinations that perpetuate their access to power and money and that discriminate in order to further deny that access to others. This is why there are no truly capitalistic societies nor any truly communistic societies in the world. What we have are systems that are various combinations of the two, and that are in continual flux, teeter-tottering back and forth, leaning toward one or the other at all times. In the U.S for example, for every shift toward communism (like the New Deal in the 1930 or the Great Society in the 1960s) we see a counter-shift toward capitialism (like in the Eisenhower Era and Reagan Era). At times however, these battles are very complex and colored in nuance. Today for instance, we are seeing that the capitalisitic shift during the Bush/Cheney that was camoflauged in smoke and mirrors is being countered with a communistic shift of the ObamaCare era that is equally as nuanced, complicated and camoflauged in smoke and mirrors.
Which brings us back to Ron Paul and his effort to shift America back towards capitalism--which is really what his 'End the Fed' ideology is all about. Does America need a shift towards free-market capitalism right now? Or do we need to continue shifting towards socialism? Is there some way to restructure the Federal Reserve System? What would happen if we stopped bailing out the "too big to fail" financial institutions? In the long run would that be better for America? Wouldn't it be more fair?
Maybe there is hope for this year's Presidential Election after all...
March 29, 2010
Ron Paul lays the ax at the root of the tree in this book by offering a very understandable explanation of how our increasing economic woes are chiefly attributable to two intertwined realities: the existence of the Federal Reserve and the corresponding system of perpetually debased fiat currency. To put it in even plainer terms, our problem is that our economy, for most of the last century, has been controlled by a giant, government-established and endorsed counterfeiting operation, one that is founded upon greed, dishonesty and outright theft, and which operates behind a cloak of secrecy with no real accountability to the government which established it. Following are a few key points that are elucidated during the course of the book:
The History and Nature of the Fed: The simple facts of the Fed's origins are enough let you know what the racket is really all about. The bill that would become the Federal Reserve Act was concocted in 1910 by a secretive group of big business men, big bankers and big politicians, at a private club owned by none other than J. P. Morgan himself. The actual purpose was to give more "flexibility" to both government and banking by freeing them from the sorts of inconvenient restraints and disciplines that a free-market economy imposes on their operations and ambitions. (Those ambitions would include allowing politicians and their cronies to grow fat off the rest of us, and also the ability to undertake certain grandiose schemes—to wage war, for instance—without simultaneously collapsing the economy and provoking civil unrest. More on that second point below.) The stated purpose, as per the official propaganda leading up to the Act's passage in 1913, was to put an end to economic instability and to promote economic prosperity. One need only examine the data to judge how poorly it has accomplished those goals. Before the Fed, it is true that economic downturns and upswings were part of the often unpleasant nature of reality. But rather than flattening them out, the Fed has merely exacerbated the cycle by amplifying and extending the fluctuations. (1913, by the way, was a very dark year. The nature of our government was forever altered and corrupted in that one year, not only by the establishment of the Fed, but also by the ratification of the 16th and 17th Amendments to the Constitution, which respectively established the income tax and mandated the election of U. S. Senators by popular vote rather than appointment by state legislatures, as had previously been the case.)
Gold, Government and the Fed: Paper money was already in existence long before the Fed, though Constitutionally illegal then as now, but the Fed and the government greatly contributed to the dollar's debauchery into the pure fiat currency that it is today. (The word fiat is Latin and means let it be so. It is often used in the Vulgate in place of amen. Today, the value of our dollars rests solely on the government's insistence that they do in fact have real value, and on nothing else—no precious metals that would defer upon them real and intrinsic worth.) Most scandalously, FDR, via Executive Order 6102, confiscated the gold of America's private citizens in 1933 and made it illegal for them to own any appreciable amounts of gold coinage, a prohibition not lifted until the mid 1970s. By that time, the last thread tying the dollar to gold had been cut by President Nixon, in the midst of a catch-22 when France called the standing U. S. bluff to redeem each $35 for one ounce of gold, in 1971. Nixon of course refused, and the only way that the dollar has been able to survive at all since then is thanks to the Fed and its mechanism of inflation. Inflation (as measured by the Consumer Price Index) had been steadily rising from 1913 to 1971. Since 1971 it has taken off like a rocket from its launch pad. The arguments of Paul and of the Austrian Economists that the return to a gold standard must coincide with the abolishment of the Federal Reserve are frequently misunderstood or misrepresented by their detractors, such as this guy.
The True Definition of Inflation: Speaking of inflation, an accurate understanding of its definition and its origins is essential, as Paul makes clear. Most people think of inflation as rising prices. This however is not really inflation itself, but merely the inevitable and most obvious effect of inflation. Inflation should actually be understood as an increase in the supply of money, which is accomplished in the present scheme by the Fed's careful manipulation of the interest rate. The Fed keeps interest rates artificially low by creating money out of thin air. This makes money available for lending which otherwise wouldn't be there (because there are no savings to speak of, which serve as the sources of borrowed capital in a healthy economy), which in turn devalues the other dollars already in existence. The folks who get the fresh dollars early (the banks and big corporate borrowers) get to spend them before this loss in value occurs. By the time they make it into the hands of the rest of us however, the simple result is that we need more of them to pay for the same amount of goods and services than we did before the inflation occurred. Inflation is thus not something that just happens, it is an indirect tax on the poor and middle-class which is enacted by the Fed.
The Fed as a Harbinger of Destruction: Central banking fosters destructive behavior within the governments and with the populace: deficit spending, wasteful and bloated government and government programs, a preference for indebtedness over saving, inordinate risk-taking on investments, short-term thinking and living, etc. However, the damage does not stop there. It is no coincidence that the establishment of central banking among world nations, culminating with the establishment of the U.S. Federal Reserve, was prelude to the most violently destructive century in world history. Central banking enables governments to wage war via economic sleight of hand and the printing press, rather than by means of direct taxation of its people, and thus removes the limitations that a sound economic system imposes upon nations by forcing them to bow the knee to fiscal reality and to exhaust other means of resolving their differences before resorting to armed conflict.
Bi-partisan Support of the Fed: The fact is that it was mostly Republicans who concocted the Kool-Aid to begin with, and they persuaded the Democrats to drink it together with them in 1913. The sad reality ever since is that very few politicians of either "conservative" or "liberal" persuasion are willing to seriously question the legitimacy and necessity of the Fed and the bogus economic assumptions and practices which it engenders. It is a given by both parties that government intervention in economic affairs must be substantial, and such squabbling as does exist over the precise extent of such intervention amounts to insignificance. Those who would be seen as champions of "free market principals" nowadays really know not of what they speak.
The last few paragraphs of the book are particularly well-put:
We have a natural, God-given right to our lives, our liberties, and the fruits of our labor.
Protecting those rights is the only role that government ought to have in a free society. To restrain the government from doing more requires a morally determined people willing to assume self-responsibility, reject dependence on government force to mold the economy, society, or individual behavior.
If the freedom movement continues to grow as it has these past two years, I would say there's plenty of room for optimism. Freedom and central banking are incompatible. It is freedom we seek, and when that precious goal is achieved, the chant "End the Fed!" will become a reality.
The History and Nature of the Fed: The simple facts of the Fed's origins are enough let you know what the racket is really all about. The bill that would become the Federal Reserve Act was concocted in 1910 by a secretive group of big business men, big bankers and big politicians, at a private club owned by none other than J. P. Morgan himself. The actual purpose was to give more "flexibility" to both government and banking by freeing them from the sorts of inconvenient restraints and disciplines that a free-market economy imposes on their operations and ambitions. (Those ambitions would include allowing politicians and their cronies to grow fat off the rest of us, and also the ability to undertake certain grandiose schemes—to wage war, for instance—without simultaneously collapsing the economy and provoking civil unrest. More on that second point below.) The stated purpose, as per the official propaganda leading up to the Act's passage in 1913, was to put an end to economic instability and to promote economic prosperity. One need only examine the data to judge how poorly it has accomplished those goals. Before the Fed, it is true that economic downturns and upswings were part of the often unpleasant nature of reality. But rather than flattening them out, the Fed has merely exacerbated the cycle by amplifying and extending the fluctuations. (1913, by the way, was a very dark year. The nature of our government was forever altered and corrupted in that one year, not only by the establishment of the Fed, but also by the ratification of the 16th and 17th Amendments to the Constitution, which respectively established the income tax and mandated the election of U. S. Senators by popular vote rather than appointment by state legislatures, as had previously been the case.)
Gold, Government and the Fed: Paper money was already in existence long before the Fed, though Constitutionally illegal then as now, but the Fed and the government greatly contributed to the dollar's debauchery into the pure fiat currency that it is today. (The word fiat is Latin and means let it be so. It is often used in the Vulgate in place of amen. Today, the value of our dollars rests solely on the government's insistence that they do in fact have real value, and on nothing else—no precious metals that would defer upon them real and intrinsic worth.) Most scandalously, FDR, via Executive Order 6102, confiscated the gold of America's private citizens in 1933 and made it illegal for them to own any appreciable amounts of gold coinage, a prohibition not lifted until the mid 1970s. By that time, the last thread tying the dollar to gold had been cut by President Nixon, in the midst of a catch-22 when France called the standing U. S. bluff to redeem each $35 for one ounce of gold, in 1971. Nixon of course refused, and the only way that the dollar has been able to survive at all since then is thanks to the Fed and its mechanism of inflation. Inflation (as measured by the Consumer Price Index) had been steadily rising from 1913 to 1971. Since 1971 it has taken off like a rocket from its launch pad. The arguments of Paul and of the Austrian Economists that the return to a gold standard must coincide with the abolishment of the Federal Reserve are frequently misunderstood or misrepresented by their detractors, such as this guy.
The True Definition of Inflation: Speaking of inflation, an accurate understanding of its definition and its origins is essential, as Paul makes clear. Most people think of inflation as rising prices. This however is not really inflation itself, but merely the inevitable and most obvious effect of inflation. Inflation should actually be understood as an increase in the supply of money, which is accomplished in the present scheme by the Fed's careful manipulation of the interest rate. The Fed keeps interest rates artificially low by creating money out of thin air. This makes money available for lending which otherwise wouldn't be there (because there are no savings to speak of, which serve as the sources of borrowed capital in a healthy economy), which in turn devalues the other dollars already in existence. The folks who get the fresh dollars early (the banks and big corporate borrowers) get to spend them before this loss in value occurs. By the time they make it into the hands of the rest of us however, the simple result is that we need more of them to pay for the same amount of goods and services than we did before the inflation occurred. Inflation is thus not something that just happens, it is an indirect tax on the poor and middle-class which is enacted by the Fed.
The Fed as a Harbinger of Destruction: Central banking fosters destructive behavior within the governments and with the populace: deficit spending, wasteful and bloated government and government programs, a preference for indebtedness over saving, inordinate risk-taking on investments, short-term thinking and living, etc. However, the damage does not stop there. It is no coincidence that the establishment of central banking among world nations, culminating with the establishment of the U.S. Federal Reserve, was prelude to the most violently destructive century in world history. Central banking enables governments to wage war via economic sleight of hand and the printing press, rather than by means of direct taxation of its people, and thus removes the limitations that a sound economic system imposes upon nations by forcing them to bow the knee to fiscal reality and to exhaust other means of resolving their differences before resorting to armed conflict.
Bi-partisan Support of the Fed: The fact is that it was mostly Republicans who concocted the Kool-Aid to begin with, and they persuaded the Democrats to drink it together with them in 1913. The sad reality ever since is that very few politicians of either "conservative" or "liberal" persuasion are willing to seriously question the legitimacy and necessity of the Fed and the bogus economic assumptions and practices which it engenders. It is a given by both parties that government intervention in economic affairs must be substantial, and such squabbling as does exist over the precise extent of such intervention amounts to insignificance. Those who would be seen as champions of "free market principals" nowadays really know not of what they speak.
The last few paragraphs of the book are particularly well-put:
We have a natural, God-given right to our lives, our liberties, and the fruits of our labor.
Protecting those rights is the only role that government ought to have in a free society. To restrain the government from doing more requires a morally determined people willing to assume self-responsibility, reject dependence on government force to mold the economy, society, or individual behavior.
If the freedom movement continues to grow as it has these past two years, I would say there's plenty of room for optimism. Freedom and central banking are incompatible. It is freedom we seek, and when that precious goal is achieved, the chant "End the Fed!" will become a reality.
April 28, 2018
As one would guess from the title, this is a polemic on the fed as an institution, it’s key players, and inflation more generally.
Paul sees the feds capacity to print money as a tax on everyone, a form of price fixing and tool of central economic planning that inevitably ends in ruin. He argues it exists only to benefits bankers, bureaucrats, politicians, developers and robs those who end up with massive debt, decreased real wages, and foreclosures when the bust comes to reckon.
Greenspan is an obvious target. Paul’s main criticism is that Greenspan created the financial crisis during late 1990s and early 2000s by keeping interest rates artificially low, disincentivizing savers, and encouraging borrowers with cheap loanable funds (and worse still cheap loanable funds backed against their inflated home equities).
I’ve read Greenspan’s Map & Territory 2.0. I found the main thrust of Paul’s attacks on this front actually interesting, and would’ve liked to see a more compelling case made for the gold standard, and why the deficient regulation of derivatives, excesses of capitalism, and inadequate quant forecasting models that Greenspan attributes cause for the crisis don’t hold water in a more itemized approach. Unfortunately Paul just lacked the technical teeth to actually get anywhere with this.
Despite its shortages, there’s some good one liners here.
“Obama’s even larger stimulus package will only target sectors of the economy that are failing. This is like trying to rid the world of gravity by throwing things up in the air. It addresses symptoms, not causes.”
Paul sees the feds capacity to print money as a tax on everyone, a form of price fixing and tool of central economic planning that inevitably ends in ruin. He argues it exists only to benefits bankers, bureaucrats, politicians, developers and robs those who end up with massive debt, decreased real wages, and foreclosures when the bust comes to reckon.
Greenspan is an obvious target. Paul’s main criticism is that Greenspan created the financial crisis during late 1990s and early 2000s by keeping interest rates artificially low, disincentivizing savers, and encouraging borrowers with cheap loanable funds (and worse still cheap loanable funds backed against their inflated home equities).
I’ve read Greenspan’s Map & Territory 2.0. I found the main thrust of Paul’s attacks on this front actually interesting, and would’ve liked to see a more compelling case made for the gold standard, and why the deficient regulation of derivatives, excesses of capitalism, and inadequate quant forecasting models that Greenspan attributes cause for the crisis don’t hold water in a more itemized approach. Unfortunately Paul just lacked the technical teeth to actually get anywhere with this.
Despite its shortages, there’s some good one liners here.
“Obama’s even larger stimulus package will only target sectors of the economy that are failing. This is like trying to rid the world of gravity by throwing things up in the air. It addresses symptoms, not causes.”
June 14, 2022
This book is essentially Ron Paul’s polemic against the FED, where he makes a libertarian case for ending the fiat currency and return to the gold standard. A bit radical and repetitive at times, but one also cannot ignore the political entanglements of a supposed independent institution in the country.
America has somewhat shifted away from its frugal starts that the founding fathers envisioned to a more materialistic economy which is driven by cheap money. We are also at a precipice of an internal conflict which tends to exacerbate during rough economic times and FED plays one of the most pivotal roles in our economy. In his book Ron Paul claims FED to be a perpetrator for the economic chaos along with the creator of moral hazard.
He raises a few interesting points but his receptive push for a gold standard was not really what I was expecting. It makes me wonder what he thinks about crypto.
America has somewhat shifted away from its frugal starts that the founding fathers envisioned to a more materialistic economy which is driven by cheap money. We are also at a precipice of an internal conflict which tends to exacerbate during rough economic times and FED plays one of the most pivotal roles in our economy. In his book Ron Paul claims FED to be a perpetrator for the economic chaos along with the creator of moral hazard.
He raises a few interesting points but his receptive push for a gold standard was not really what I was expecting. It makes me wonder what he thinks about crypto.
August 3, 2021
This is what I call a “pointer book.” It’s primary purpose is to point readers to other books which make deeper, more extensive arguments on the subject. Paul offers some personal anecdotes and experiences he’s had on this topic over the years.
Honestly, it’s not really worth reading. Save yourself some time and go directly to what Paul points to: Hayek, Mises, Rothbard who all have more in-depth treatments.
I will say, I was pleasantly surprised with his favorable references to Rand’s Atlas Shrugged.
Honestly, it’s not really worth reading. Save yourself some time and go directly to what Paul points to: Hayek, Mises, Rothbard who all have more in-depth treatments.
I will say, I was pleasantly surprised with his favorable references to Rand’s Atlas Shrugged.
April 19, 2020
Ron Paul is a man for our times as we enter into a Soviet style police state under the guise of “public health.”
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