What if Ron Paul had his way?

I want to ask a hypothetical question... what if Ron Paul's wish came true... what would the world look like?


More specifically...

- What would be the consequence of "ending the Fed," and returning to a gold standard?

- What would be the consequence of withdrawing foreign troops, shutting down foreign bases, and taking a non-interventionist global strategy?

- What if we really did cut a trillion dollars from the federal budget, as Paul proposes?

Sources:

RON PAUL "PLAN TO RESTORE AMERICA" | Ron Paul 2012 Presidential Campaign Committee

Peter Grimm said:

I want to ask a hypothetical question... what if Ron Paul's wish came true... what would the world look like?


More specifically...

- What would be the consequence of "ending the Fed," and returning to a gold standard?

- What would be the consequence of withdrawing foreign troops, shutting down foreign bases, and taking a non-interventionist global strategy?

- What if we really did cut a trillion dollars from the federal budget, as Paul proposes?

Sources:

RON PAUL "PLAN TO RESTORE AMERICA"*|*Ron Paul 2012 Presidential Campaign Committee

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Nto enough gold to sustain it. The markets would implode.
Not a good idea about non interventionist global strategy, but no worse than the disasterous one the Obama administration has now.
Not a hard thing to do if the government would simply spend the same money as civillians do for the same services.

Peter Grimm said:

I want to ask a hypothetical question... what if Ron Paul's wish came true... what would the world look like?


More specifically...

- What would be the consequence of "ending the Fed," and returning to a gold standard?

Click to expand...

Returning to the gold standard would result in an absolute collapse of the world economy. The whole thing thrives on people participating in the fiction that their money is actually worth something. (And then replace that with the fiction that gold is actually worth something)

Your money is only worth what you can get with it. Devaluing the currency reduces the buying power of every cent in your pocket.

You'd be left longing for the good old days of Obama.

- The country would go bankrupt overnight. It would be the end of the dollar as the world reserve currency and the global financial system would collapse.

- See Iraq.

- There would be no federal government. Cutting $1 trillion tomorrow would leave barely enough money to cover mandatory spending and an army.

Peter Grimm said:

I want to ask a hypothetical question... what if Ron Paul's wish came true... what would the world look like?


More specifically...

- What would be the consequence of "ending the Fed," and returning to a gold standard?

Click to expand...

if he had his way, the only change would be:

1) you don't pay taxes on capital gains for when gold/what ever montary unit gains in value against paper currency
2) paper currency will not hold a monopoly in contract law disputes.

In the short run, the biggest impact would be that the Fed would have to reign in quantitative easing as they now must compete with other forms of currency, which means the U.S. govenrment would be forced to cut it's spending as one huge tool in its arsenal (debasement) would be off the table

In the long run, we would not be the lone super power spending more on defense then all the largest nations combined. We would not consume more goods then other nations of similar size.

Rhapsody1447 said:

- The country would go bankrupt overnight. It would be the end of the dollar as the world reserve currency and the global financial system would collapse.

- See Iraq.

- There would be no federal government. Cutting $1 trillion tomorrow would leave barely enough money to cover mandatory spending and an army.

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did this happen in the 70's when we defaulted?

- What would be the consequence of "ending the Fed," and returning to a gold standard?

Not likely to happen. However, I think that some steps would be taken to try and preserve the inherent value of the dollar as opposed to the endless inflation.

- What would be the consequence of withdrawing foreign troops, shutting down foreign bases, and taking a non-interventionist global strategy?

Within reason, a great idea. I doubt that we would become isolationist but we certainly don't need to be in everybody's business all the darn time. We have certain treaties we would be obligated to honor and combat would have to emanate from Congress (as the Constitution dictates) instead of arbitrary interventions by the POTUS.

- What if we really did cut a trillion dollars from the federal budget, as Paul proposes?
We have so much wate, fraud and "crony capitalism" that this could likely be accomplished with relatively little pain thereby solving problem 1, the preservation of the value of money.

These are my OPINIONS for discussion. Please refrain from personal attacks.


Sources:

RON PAUL "PLAN TO RESTORE AMERICA"*|*Ron Paul 2012 Presidential Campaign Committee[/QUOTE]

ARealConservative said:

did this happen in the 70's when we defaulted?

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Of course not, which is why we all look back on the halcyon days of Jimmy Carter.

rocket88 said:

Of course not, which is why we all look back on the halcyon days of Jimmy Carter.

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we defaulted during Nixon, not Carter.

ARealConservative said:

we defaulted during Nixon, not Carter.

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The policies that led to the economic disaster under Carter were enacted by Nixon. Economies don't suddenly fall apart, usually it's previous years of bad policies.

Take the deficit. It didn't suddenly appear under Obama. That kind of spending was the policy of every President since Reagan.

ARealConservative said:

we defaulted during Nixon, not Carter.

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I think they are talking a very short-term, limited default that occurred in 1979 -- when Carter was Prez. It was more of a software glitch than anything else. The Treasury made good on the debt in a matter of days when it got cleared up. Obviously that's in no way comparable to what would happen under a President Paul.

ARealConservative said:

if he had his way, the only change would be:

1) you don't pay taxes on capital gains for when gold/what ever montary unit gains in value against paper currency
2) paper currency will not hold a monopoly in contract law disputes.

In the short run, the biggest impact would be that the Fed would have to reign in quantitative easing as they now must compete with other forms of currency, which means the U.S. govenrment would be forced to cut it's spending as one huge tool in its arsenal (debasement) would be off the table

In the long run, we would not be the lone super power spending more on defense then all the largest nations combined. We would not consume more goods then other nations of similar size.

Click to expand...

But Ron Paul is talking about ending the Fed. What would be the consequences of that?

To end the Fed, you would need a sweeping overhaul of the banking system.

You would essentially need to do away with fractional reserve banking... which would essentially remove all profits from the banking sector.

Credit and lending would be a thing of the past. We would enter into a depression.

On the other end of the depression, we would have sound money, and the cycle of boom-and-busts would end. Bubbles would be a thing of the past. Growth would be slow and steady, and much more predictable.

The banking sector and Wall Street would no longer have any power.

Finance as we know it would be altered forever. Small business and entrepreneurs would be SOL. Large corporations would have a leg-up on everyone.

Peter Grimm said:

But Ron Paul is talking about ending the Fed. What would be the consequences of that?

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Ron Paul is primarily an education candidate, but he has stressed time and again that we can't just end so many of these programs implemented that people depend on.

In cased like the FED, he has proposed subtle changed that would most likely lead to its demise long term, but not short term. I outlined specific changes that would undermine the power of the Fed, but wouldn't close it outright.

I respect that a bunch. Whereas someone like Newt Gingrich also comes along claiming to support sound monetary policy, while then talking about moon bases. He is all over the map, making me realize he is just saying things people want to here for political viability.

AdamT said:

I think they are talking a very short-term, limited default that occurred in 1979 -- when Carter was Prez. It was more of a software glitch than anything else. The Treasury made good on the debt in a matter of days when it got cleared up. Obviously that's in no way comparable to what would happen under a President Paul.

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what default occurred in 1979?

Peter Grimm said:

To end the Fed, you would need a sweeping overhaul of the banking system.

You would essentially need to do away with fractional reserve banking... which would essentially remove all profits from the banking sector.

Click to expand...

fractional reserve banking existed before the fed and could certainly exist after as well.

ARealConservative said:

fractional reserve banking existed before the fed and could certainly exist after as well.

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Without a central bank, how do you massive stop bank runs? When people run on the bank, how do you stop the bank from collapsing?

You can talk about wanting sound money... what about sound banking?

To end the Fed but continue to allow fractional reserve banking would be economic suicide. It wouldn't be a question of if, but when the banking system would totally collapse.

Just take you and me, for example. If there were no Federal Reserve, I would immediately want all my money OUT of the bank. Wouldn't you??

Why would you keep your hard-earned money in a bank, when that bank only holds 10% of your deposits... if there is no insurance?? You might well lose it all.

Peter Grimm said:

Without a central bank, how do you massive stop bank runs? When people run on the bank, how do you stop the bank from collapsing?

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The same way it works now. An agency more rich then the individual bank insures deposits up to some level. This could be govenrment, or a pool of insurance of member banks.

How would a central bank stop a run if faith in the central bank is gone?

You can talk about wanting sound money... what about sound banking?

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I feel fractional reserve can be sound. ultimately, people have the choice, which is the true beauty.. If they prefer to pay someone to guard the money, or hide it, so be it. No different then now.

To end the Fed but continue to allow fractional reserve banking would be economic suicide. It wouldn't be a question of if, but when the banking system would totally collapse.

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hyperbole. People invest in stocks even though those tank all the time.

paper currency will totally collapse again (happened in 1971)

I move to Vancouver.

Peter Grimm said:

- What would be the consequence of "ending the Fed," and returning to a gold standard?

Click to expand...

Even in his book "End the Fed" , he doesn't call for ending the fed overnight. He'll first do what he's been trying to do for awhile which is make gold and silver legal tender as in our constitution.(Abolish legal tender laws). Eventually allowing people to choose what suits them best as a medium of exchange. If it works you can help end both inflation and recessions. Also help to End the Fed, by creating a free-market alternative to the Federal Reserve money monopoly.


Here is the bill he keeps on submitting each year.

Read The Bill: H.R. 1098 - GovTrack.us

and a youtube of him explaining it:

Ron Paul: We Need Free Competition in Currencies! - YouTube

What would be the consequence of withdrawing foreign troops, shutting down foreign bases, and taking a non-interventionist global strategy?

Click to expand...

Consequence? None that I can think of... The world survived without our presence and our interventionist foreign policy is creating more enemies then friends. Will probably make more friends but I fear it may to late because of the damage we've done already to reverse course. But we gotta stop this one way or another. Economically, will be force to withdraw anyway.



Then their is the economic benefit of all our troops spending over here and not in foreign places. Also not spending so much overseas which will help our deficit and we can use the money for us.

What if we really did cut a trillion dollars from the federal budget, as Paul proposes?[

Click to expand...

Most is from oversea spending, others from attrition. Lots of agencies need cut backs (he is suggesting 2006 budget levels) in spending or dissolved into another agency. Most agencies will be cut through attrition so it's not like he is kicking people out on the spot. It's a path on the right track.

Anyway, I'll like to thank you for posting this. I like answering people who are genuinely interested in information.

Peter Grimm said:

More specifically...

- What would be the consequence of "ending the Fed," and returning to a gold standard?

Click to expand...

Ending the Fed would be good, but it is impossible to go back to the gold standard.

- What would be the consequence of withdrawing foreign troops, shutting down foreign bases, and taking a non-interventionist global strategy?

Click to expand...

We do need to get our troops out of Afghanistan, because we are too tired and stretched. However, it is every dangerous to have a non-interventionist policy.


My kind of policy would be to get out Afghanistan of the U.N. because they want a "new vorld ordir".

- What if we really did cut a trillion dollars from the federal budget, as Paul proposes.

Click to expand...

Good things! :mrgreen:

ARealConservative said:

The same way it works now. An agency more rich then the individual bank insures deposits up to some level. This could be govenrment, or a pool of insurance of member banks.

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It seems to me, you are describing a central bank. How is this concept any different?

ARealConservative said:

How would a central bank stop a run if faith in the central bank is gone?

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Central banks stop bank runs by pouring cash into banks when "runs" on banks begin. For example, say the Bank of Kalamazoo has $10 million in deposits. They have $1 million in the vaults, $9 million are lent out to small business

Now, say there is a panic in the economy, and a bank run on the Bank of Kalamazoo. People want their money out. Well, the bank only has $1 million in the vaults. So what happens? The Fed to the rescue. The Fed dumps money in to the Bank of Kalamazoo, people are able to withdraw their money, and the panic ends.

How do Central Banks have the funds to do this? They have the ability to print and to destroy money.

When the chaos ends, the Bank of Kalamazoo repays the central bank and things return to normal.

ARealConservative said:

I feel fractional reserve can be sound. ultimately, people have the choice, which is the true beauty.. If they prefer to pay someone to guard the money, or hide it, so be it. No different then now.

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Except that you can't insure all bank deposits without a central bank. So the rational thing to do would be to hoard cash and lock it up in a vault, some kind of bailment. Again, there would be no reason to have your money in a bank if that bank can't guarantee that you can take your money out.

jasonxe said:

Even in his book "End the Fed" , he doesn't call for ending the fed overnight. He'll first do what he's been trying to do for awhile which is make gold and silver legal tender as in our constitution.(Abolish legal tender laws). Eventually allowing people to choose what suits them best as a medium of exchange. If it works you can help end both inflation and recessions. Also help to End the Fed, by creating a free-market alternative to the Federal Reserve money monopoly.


Here is the bill he keeps on submitting each year.

Read The Bill: H.R. 1098 - GovTrack.us

and a youtube of him explaining it:

Ron Paul: We Need Free Competition in Currencies! - YouTube




Consequence? None that I can think of... The world survived without our presence and our interventionist foreign policy is creating more enemies then friends. Will probably make more friends but I fear it may to late because of the damage we've done already to reverse course. But we gotta stop this one way or another. Economically, will be force to withdraw anyway.



Then their is the economic benefit of all our troops spending over here and not in foreign places. Also not spending so much overseas which will help our deficit and we can use the money for us.




Most is from oversea spending, others from attrition. Lots of agencies need cut backs (he is suggesting 2006 budget levels) in spending or dissolved into another agency. Most agencies will be cut through attrition so it's not like he is kicking people out on the spot. It's a path on the right track.

Anyway, I'll like to thank you for posting this. I like answering people who are genuinely interested in information.

Click to expand...

You can end the Fed, and I'm not even convinced that would be a bad thing. But in the short and maybe medium term, it would be a killer. Really painful. We are talking a massive depression.

Would we come out the other side better off? Yes, perhaps. But then again, perhaps not.

00timh said:

Nto enough gold to sustain it. The markets would implode.
Not a good idea about non interventionist global strategy, but no worse than the disasterous one the Obama administration has now.
Not a hard thing to do if the government would simply spend the same money as civillians do for the same services.

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You left off eliminate the Civil Rights and Voting Rights Act, amending the Constitution to declare "Life Begins at Conception, and shutting down the FDA, EPA, OSHA, USDA. For starters.

Peter Grimm said:

You can end the Fed, and I'm not even convinced that would be a bad thing. But in the short and maybe medium term, it would be a killer. Really painful. We are talking a massive depression.

Would we come out the other side better off? Yes, perhaps. But then again, perhaps not.

Click to expand...

actually, i mistype. It wouldn't end the fed but just greatly diminish it monopoly over our currency. He would probably agrue the fed helps creates depression.