httpv://www.youtube.com/watch?v=plf-j6vFnQI At first glance, abolishing the Federal Reserve and returning to the gold standard seems a quaintly eccentric idea, but Texas congressman Paul presents a plan to eliminate our country’s central bank, and return to a private banking system, that’s both serious and plausible. The questionable aspects involve Paul’s predicted results: not only will ending the Fed eliminate inflation (the government cannot print more money than it has gold reserves), but also business booms and busts, wars, income inequality, trade imbalances and the growth of government. Further, and perhaps most important, it would “disempower the secretive cartel of powerful money managers who exercise disproportionate influence over the conduct of public policy.” Paul tends to gloss over those periods in history, including the Panic of 1907, in which private banking and the gold standard were law: “the bad reputation of nineteenth century American banking… is largely the result of… propaganda agitating for the creation of the Fed.” With respect to “secretive cartels,” Paul takes up the interesting question of whether J.P. Morgan is in fact preferable to Ben Bernanke. An engaging response to big-government solutions for the financial crisis, this knowledgeable and opinionated look at U.S. economics, from a firebrand public servant, should provoke much thought.
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