Saturday, May 31, 2008

Book Review - 'The Revolution: A Manifesto" by Ron Paul

I just finished reading Ron Paul's new book and wanted to review it and share some thoughts about it. I learned a lot and would recommend anyone that believes in limited government and individual liberty to take the time to do so also.


Preface: Favorite quote….”We are borrowing from Europe in order to defend Europe, we are borrowing from Japan in order to keep cheap oil flowing to Japan, and we are borrowing from Arab regimes in order to install democracy in Iraq. Is it really ‘isolationism’ to find something wrong with this picture”.


This quote really hit me and made a lot of sense. But it is very descriptive of our current fiscal policies in regards to spending money that we don’t have for causes we don’t necessarily need to support.


Chapter One: The False Choices of American Politics
Paul discusses the current political situation in Washington, where although there seem to be two parties fighting for control, in reality there are very few differences between those two parties.


Looking at John McCain and Barack Obama, besides their position on Iraq, can you really point out many differences between the two candidates?? Seriously, is anything going to change in Washington if one of these two get elected?? I think not.


Favorite quote….”And so every four years we are treated to the same tired, predictable routine: two candidates with few disagreements on fundamentals pretend they represent dramatically different philosophies of government.


Chapter Two: Foreign Policy of Our Founding Fathers
A lot of people would label Paul as an isolationist, but he uses the term “non-interventionalist” to describe his foreign policy views. He basically says we need to stay out of other countries’ business, and by not doing so in the past, we have had many needless wars, huge budget deficits, and the overall view of America in the world has declined significantly to one of disgust and hatred in some cases. (the Middle East). He uses a lot of historical quotes, including George Washington, John Quincy Adams, Henry Clay, and Robert Taft, to show how our country was indeed based upon a “non-intervention” philosophy. Paul goes on to explain that many of the problems we now face in the war on terrorism were caused by our foreign policy. He does not in any way say that Al Qaeda or other terrorists are justified in their actions – he simply tried to explain why they attack us and why they can recruit new members - because, as Paul puts it, “we’re over there”. I don’t agree with everything Paul says in regards to foreign policy, but I understand his arguments and I do believe it is true that American can literally not afford to act as the world’s policeman for much longer.


Favorite quote….”I’m not so sure the role of the United States is to go around the world and say ‘This is the way it’s got to be’…I think one way for us to end up being viewed as the ugly American is for us to go around the world saying, ‘We do it this way; so should you.’” Said by George Bush, 2000, in a debate against Al Gore. Very interesting.


Chapter Three: The Constitution
Paul starts this chapter by pointing out how much power the executive branch has gained over the past 100 years, going directly against what the Framers of the Constitution had in mind. The main culprit of this extra power is the executive order, which was rarely used in the 19th century but has been used frequently starting with Teddy Roosevelt, as well as something called presidential signing statements, which the Bush administration has used frequently. He goes on to point out the many people today view the Constitution as a “living” document that needs to change as time goes on. This belief allows judges and politicians to conveniently twist and turn the original Constitution to whatever best meets their unique political agendas. As Paul points out, a “living” Constitution is great for powerful governments because whenever citizens feel their rights are being violated, the government can just use the excuse that the citizens are misinterpreting the document because it has changed over time. Very convenient indeed.


Paul goes on to discuss two Constitutional issues relating to national defense that are also no longer being followed – the right for only Congress to declare war (which has been violated as recently with 2002 with the invasion of Iraq) and the military draft (which is not stated anywhere in the Constitution as being a power of the federal government). He also discusses his personal opposition to abortion, but explains how constitutionally, this should not be a federal government issue at all. This, along with many other issues like prayer in schools, drug policy, and the death penalty, are policy decisions that need to be made on a state level, not controlled in perpetuity by the federal government.


Favorite quote….”If our government were scrupulously faithful to the Constitution, we would not need to be especially concerned when a person who represents a philosophy different from our own takes political office. Our Constitution delegates relatively few tasks to the federal government, so it should almost be a matter of indifference who is elected.”


Chapter Four: Economic Freedom
Out of all the positions Paul supports, this is the one I find myself agreeing with him the most on. I agree with his other positions, but his stances on economics is the real reason I find him intriguing as a candidate. He starts by quoting Fredric Bastiat and using the term “legal plunder” to describe what the government does to its citizens and that our basic economic system amounts to everyone (rich or poor) using the government to enrich themselves at the expense of their neighbors. Paul goes on to state that the main problem with the government getting involved in economic programs, besides the special interests influencing decision making, is that bureaucracy eats up most of the money that is involved in these programs that is supposed to go for helping people. Paul says that as much as 70% of welfare budgets has been eaten up by bureaucracy, and government programs can easily be abused because of how inefficient they are. That abuse and inefficiency is paid for by none other than the American taxpayer.


Paul goes on to discuss his opposition to the income tax (it implies the following: the government owns you and graciously allows you to keep whatever percentage of the fruits of your labor it chooses), but also how out of control spending has led to the massive debt problems we have in our country. According to Paul, eliminating the income tax would cut government revenues by 40%. That seems drastic, but as he points out, it would put the size of the federal budget back to where it was in 1997. 1997 is only ten years ago. So our government has increased their spending 40% in the last ten years. That is scary. He quote David Walker, the comptroller of the United States, and includes many figures that should be alarming to just about every American. The bottom line is that the government has lived outside its means for too long, and if spending is not controlled soon, our economy is in for major problems.


What does Paul plan to do if big programs like Medicare and Social Security is cut back drastically? Well, one idea Paul has is to save money by cutting back our massive military budget and brings troops home from most of our overseas commitments. Streamlining this department would save trillions. In addition, he believes if social programs were also cut back, the country would do what it did before those programs were so big – have the private sector take over those roles. He believes private sector charities would take over a major role in our country and likely do a much better job of providing help, whether it be health care, medicine, or welfare, than the government does currently. He gives a lengthy description of how the government has screwed up the health care sector through the establishment of HMO’s, which he believes, again because of the size of the bureaucracy, have done nothing but drive the cost of health care up and drive the quality of health care down. He supports tax-sheltered health savings accounts for all Americans as a starting point to fix the massive problems in health care. I learned a lot from this particular section and as a practicing physician, Paul has experience to back up what he is saying.


Paul goes on to discuss his opposition to government regulation in the business worls, and his support of free trade, arguing against NAFTA and the WTO. In his eyes, the WTO simply allows decisions for our country to be influenced unnecessarily from other countries that have different points of view from ours. He opposes foreign aid, as most gets wasted and misused by those in power. He points out success stories from countries like Botswana, Chile, India, and China, who all thrived economically as soon as free economies were established. Unfortunately, the U.S. seems to be moving farther away from a truly free economy, and that is scary.


Favorite Quote….”For instance, anyone going into his neighbor’s home and taking his money at gunpoint…would be arrested as a thief. But for some reason it is considered morally acceptable when the government does that very thing. We have allowed government to operate according to its own set of moral rules.


Chapter Five: Civil Liberties and Personal Freedom
This chapter did not interest me quite as much as the other ones, but Paul still made some good points that I agree with, and changed my mind on some other issues. He starts by describing how the government has used the war on terror as a free ticket to engage in spying on Americans in the form of the Patriot Act. I will not go into every detail and example Paul describes of the new power of the government to basically do whatever it wants now in terms of searching private property, monitoring internet usage and email, listening in on phone calls, etc. It was scary to read however.


Paul’s next focus in this chapter was the failed drug war and his belief that drugs should be legalized. He states this would save the government millions of dollars in court costs, prison costs, and police costs, but would also eliminate many of the problems seen across the inner cities of America, where drug use is so heavy. His points make a lot of sense – for instance, what has the drug war really accomplished? He points out that even prisoners, who are locked up and surrounded by security officers, are found with drugs. If people want drugs, they get them. So why are we spending so much time and money fighting this war. For Paul, it goes back to personal freedom – he believes it is not the government’s right to tell people what they can and cannot do, and government cannot change the way people act, or shouldn’t be allowed to try, at least.


Paul wraps up talking about schooling as well and his support of home-schooling. One particular story really struck me, or scared me, perhaps. He states that in 2004, a presidential initiative called the New Freedom Commission on Mental Health called for forced mental health screenings for all children in the nation, starting around preschool. Luckily, this program has not been put into action yet, but Paul says pilot programs are in the process of being started in certain locations. Why would the government do such a thing? Well, Paul states that the obvious beneficiary of such a program would be the pharmaceutical industry – their lobbyists likely had a little to do with the program. As a parent, that story really struck me.


Favorite Quote…."Our Constitution was written to restrain government, not the people. Government is always tempted to turn that maxim upside down.


Chapter Six: Money: The Forbidden Issue in American Politics
This is the other area of Paul’s platform that I find myself agreeing with tremendously. About a year ago, I had very little knowledge of how the Federal Reserve works, but after reading some of Paul’s writings, I am supportive of getting rid of the Fed just like Paul is. Paul starts by pointing out that the Constitution specifically calls for Congress to maintain a gold or silver currency and not make credit out of thin air. Until 1933, when the Gold Standard was eliminated, Congress did a good job of sticking to this premise. Now, the Federal Reserve has taken over controlling our monetary policy, and Paul does a good job explaining how this has brought nothing but trouble.


He explains the basic way the Fed works: they lower interest rates to stimulate the economy by buying bonds directly from banks, which gives the banks more funds to lend. They lend this extra money to other banks or the public, but since they have more to lend, they need to lower the interest rates on the loans to attract more potential clients. Therefore, you have lower interest rates. The real problem with this process is that when the Fed buys the bonds from the banks, they make the money they buy with out of thin air. They just make it up. This leads to many of the economic problems we have in our country right now. Paul explains that as the Fed creates more “fake” money and pump it into the economy, it also makes every single dollar already in the economy worth less and less. Since there is more money in the system, that also means that prices paid for goods also has to increase. The combination of this increase in money supply causing rising prices is inflation.


Paul rightly sees inflation as a hidden tax on the middle and lower classes of American. Some supporters of inflationary policy state that wages rise over time just like prices, so those rising prices really aren’t a big deal. Paul debunks this, explaining that as the money enters the system, the banks and big corporations are the first to benefit, usually before prices start to rise. The money eventually trickles down the system to working people in the form of higher wages, but by that point, prices have already risen so much and for so long, that their higher wages do very little to help them. The current system allows the politically well-connected (banks, corporations) to benefit at the expense of the average American. The worst part of the system is that people don’t realize how they are being taken advantage of because it is somewhat complicated.


Paul goes on to explain how all the ups and downs of our economy in the form of bubbles and recessions can be traced to the Fed’s monetary policy. He sites the “lost decade” for Japan in the 90’s, along with both the stock market bubble in 2000 and the recent housing bubble as outcomes from lenient monetary policy. He also tells an interesting story of a discussion he had with former Fed chair Alan Greenspan. Paul had him sign a 1966 article Greenspan wrote in which he argued for a commodity-based monetary system rather than our current “fiat” system. Paul asked him if he wanted to write a disclaimer on it, but Greenspan stated he still stood behind everything he wrote. Of course, a few weeks later at a committee meeting, Paul asked Greenspan about his thoughts and he changed his tune in front of the public and other Congressman. Very interesting.


Favorite Quote….”Where does the Fed get the money to buy the bonds? It creates it out of thin air, simply writing checks on itself and giving them to banks. If that sounds fishy, then you understand it just fine.


Chapter Seven: The Revolution
In this chapter, Paul explains what he feels needs to be done for our country to go back to the country that our Founding Fathers intended it to be. Many of the ideas discussed earlier in the book are brought up again – backing the currency with gold, decreasing spending by pulling back on our oversees commitments, pulling troops out of Iraq and other countries around the world.


Favorite Quote…."We can either withdraw gracefully…or we can stay in our fantasy world and wait until bankruptcy forces us to scale back our foreign commitments.


Overall, I learned a great deal from this book. I got it out from my library, but as I read it, I purchased a copy to have as well. I realize Paul will not win this election, but he is the only candidate talking about the issues that are going to affect America for a long time. I don’t agree with everything Paul says, but I do agree with a lot of it. American was a country founded on individual liberty and freedom, not government intervention and control. Unfortunately, it seems like we are getting farther and farther away from the former and closer and closer to the latter. I encourage you to read the book, or other writings by Paul which can be found online at the mises.org website. We as a population need to educate ourselves if the tricks and mistakes our government continue to make are ever going to stop.

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