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Ron Paul on CNN Late Edition (September 21, 2008)

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BLITZER: Welcome back. Congressman Ron Paul did not win the Republican presidential nomination, but he did raise millions and millions of dollars and he did inspire a multitude of supporters across the country with his very blunt libertarian views. He has been no less blunt about his dislike of the multi-billion dollar bailouts happening right now on Wall Street. Congressman Paul is joining us from Houston, Texas. Congressman, thanks very much for coming in. RON PAUL: Thank you, Wolf. BLITZER: I want you to listen to President Bush because he painted a very dire, dire assessment of what would happen if the Congress did nothing right now. BLITZER: Listen to this. PRESIDENT GEORGE W. BUSH: This is a big price tag because it's a big problem. The risk of doing nothing far outweighs the risk of the package. BLITZER: All right. So, what do you say to the president, who wants you and your fellow Republicans and Democrats to quickly pass this $700 billion bailout package? PAUL: Well, I think that's a mistake because we don't have the money. But that doesn't mean you have to do nothing. I mean, we could reform the system. We could return to sound money. We could balance our budget. We could change our foreign policy. We could take care of our people at home. We could lower taxes. There's a lot of things that we can do. But the worst thing that we can do is perpetuate the bad policies that gave us this trouble in the first place. And that is that we no longer, over the last quite a few decades, believed in free-market capitalism. Capital is supposed to come from savings. We're supposed to work hard and save. As a matter of fact, the Chinese work hard, right now, and they save, and they're buying up the world. But we borrow and spend and consume, and now it's caught up to us and it's undermining our whole system. But all we're doing now, by coming back for $700 billion -- you know, when the war started in Iraq, they said we need $50 billion. Then Larry -- Larry -- whatever -- I can't think of his name... (LAUGHTER) He predicted it would be $200 billion. And he lost his job over it. Now we... BLITZER: That was Larry Lindsey. PAUL: Larry Lindsey -- I'm sorry. So this $700 billion is not going to do it. He was the economic advisor to the president. BLITZER: But what they're saying -- what the Treasury secretary, the chairman of the Federal Reserve, the president; then we heard Chris Dodd -- what they're saying is, this is no longer simply a bailout of these huge Wall Street firms. This is a bailout of Main Street, they say, because people's life savings... PAUL: No. BLITZER: ... and people's 401(k)s, their IRAs, their homes, everything would be lost. This would make the Great Depression, in effect, look like small potatoes, if they didn't take this immediate action right now. PAUL: Well, you could look at it the other way. This is Wall Street in big trouble and sucking in Main Street, now, and dumping all the bills on Main Street. Because, yes, there are a lot of those problems. There's no doubt about it. But destroying the dollar is much worse. You don't even have to have a 401(k) to be injured by the devaluation and destruction of the dollar, and that's what we're dealing with. Sure, they should be frightened, but, boy, it's a lot different, a lot bigger than that, what they're talking about. And you can't solve the problem of inflation, which is the creation of money and credit out of thin air, by more money and credit out of thin air, and not changing policy. We have to change basic policy. Yes, it would be painful, but it wouldn't last so long. What they're doing now, they're propping up a failed system so the agony lasts longer. They're doing exactly what we did in the Depression. BLITZER: But what they're saying -- what they're saying, Congressman, is, even those money market funds, the stuff that's supposed to be totally, totally safe, that might not even be safe. And people who have money market funds, people who have their, kind of, sort of, secure bonds, the whole financial system, they say BLITZER: Are they simply exaggerating? Are they simply misleading the American people? PAUL: Well, no. I don't think they understand it, because how could they be safe if you destroy the dollar? It will be more pervasive. If you have no investments whatsoever and you're dependent on a Social Security check and it doesn't buy anything, that's much more damaging. So, yes, there are going to be losses, but everybody lived beyond their means when the prices of houses were going up. Nobody cared about it. They kept borrowing against it. Oh, yes, that was fine and dandy. Everybody was making money, and the owner of the home kept borrowing and living beyond their means. Now they have to live beneath their means. What the government is doing now -- and this new program is trying to prop up prices. You want the price structure to adjust. You want the price of houses to go down. You don't want to fix the price of housing. You can't price-fix. We've had too much of that. BLITZER: All right... PAUL: And that is our problem. We need a market economy. We need to believe in ourselves. We need to believe and understand how the economy got us -- how the government got us into this mess. And believe me, it wouldn't be that tough. It would be a bad year. But, this way, it's going to be a bad decade. BLITZER: The Republican presidential nominee, John McCain, says yet another government institution needs to be created, right now, to deal with this crisis. I'm going to play a little clip of what he has in mind, and then we'll discuss. Listen to this. MCCAIN: I will lead in the creation of the mortgage and financial institutions trust, the MFI. The MFI is an early intervention program to help financial institutions avoid bankruptcy, expensive bailouts and damage to their customers. BLITZER: All right. What do you think? Is he on to something? PAUL: Hardly. I mean, it's just more of the same, more government, more programs, more spending, more regulations, trying to prop up a system that has been undermined. The market is saying it's nonviable, and everything they're doing is trying to patch it up. The bubble has been blown up. It needs to deflate, and they won't allow it. So it's a contest between deflation and inflation. Everybody in Washington wants to inflate because it's painful to get off this dependency on perpetual deficit spending and inflation. So, no, another program, another group of people to regulate and take up all these bad debts off Wall Street and dump them on Main Street -- this means that the people who have lost on Wall Street want to dump it on Main Street. So this isn't saving Main Street. This is sticking it to Main Street and sticking it to the taxpayer BLITZER: Here's the criticism that Senator Obama leveled on Senator McCain. Listen to this. OBAMA: He said he would take on the old boys' network. But he seemed to forget that he took seven of the biggest lobbyists in Washington and put that network in charge of his campaign. John McCain can't decide whether he's Barry Goldwater or Dennis Kucinich. BLITZER: Do you think Senator Obama has a better grasp of what's going on than Senator McCain? PAUL: Well, he has a pretty good grasp on how to attack this politically and go after McCain. But he doesn't have any answer. He's not talking about the Federal Reserve system. He's not talking about balanced budgets. He's not talking about bringing troops home from Afghanistan. We have to live within our means. That's why I talk about foreign policy. We spend $1 trillion a year overseas. If you want to take care of people at home, you've got to cut someplace. But here we're adding $700 billion to the budget, the national debt going up to $11.3 trillion. No, Obama offers no solutions, but he has some, you know, pretty accurate points making, when he criticizes McCain. I think he does that quite well. BLITZER: Who are you going to support? PAUL: Well, neither one of those two. (LAUGHTER) They don't offer any alternatives, so I will be looking at the alternatives for a vote in November. BLITZER: Thank you very much, Congressman, for coming in. PAUL: Thank You

Video Details

Duration: 7 minutes and 39 seconds
Country: United States
Language: English
Genre: None
Producer: KramerDSP
Director: KramerDSP
Views: 121
Posted by: kramerdsp on Sep 25, 2008

Ron Paul is interviewed by Wolf Blitzer of CNN about the bailouts.

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