| | Ron Paul delivers opening statement during HFSC hearing
The congressman from Texas spoke all the way through to a premature commercial break on a live CNBC broadcast this morning.
The House Financial Services Committee, headed by Rep. Barney Frank, met today to hear the testimony of Ben Bernanke, the chairman of the Federal Reserve. Before they could get to that, however, there was a short but wide-reaching statement delivered by Ron Paul.
Paul, whose star rose with his failed presidential bid in 2008, is known for his small-government policies and voting habits. A study in the American Journal of Political Science found him to be the most conservative of all members of Congress from 1937 to 2002. He votes against almost all government spending proposals, earning him the nickname “Dr. No”, and he firmly believes in the dismantling of the Federal Reserve system.
Documents from the hearing - entitled “Monetary Policy and the State of the Economy” - as well as Bernanke's testimony can be found here. The plan Ben Bernanke gave to the HFSC today had four different facets. First, upcoming 'stress tests' by the government for struggling banks will pave the way for a new 'capital assistance program'. Second, private capital will be leveraged with public funds to purchase legacy assets from financial institutions. Third, the Federal Reserve will use capital provided by the treasury to expand the scope and strength of TALF, the government's loan-extension program. Fourth, measures will be set up to prevent unnecessary foreclosures.
Ron Paul essentially disagreed with all four facets of the Federal Reserve's program for the struggling economy. In his two-minute statement, he started by branding the financial system a failure, and then laid out the reasons why he didn't think Bernanke's plan was going to save the economy. “It is fundamental for us to understand...if we think we can patch up a system that has failed, it's not going to work,” he told the Reserve's chairman. “We have a total misunderstanding of what credit is, versus capital. Capital can't come from the thin-air creation by a Federal Reserve system, capital has to come from savings. We work hard, produce, live within our means, and what is leftover is called capital. This whole idea that we can 're-capitalize' markets by merely turning on the printing presses and increasing credit is a total fallacy,” he said in his address. “Give up on the dollar standard. We have to be very much aware that the system will [not be] viable. We have to have a system that encourages people to work, and to save.”
After two minutes, Ron Paul concluded his statement and ceded the floor to Representative Castle. As Castle began to speak, the broadcast returned to the station. Apparently, CNBC wasn't aware that there would be more than one opening statement before Bernanke's testimony, so the station cut to an unplanned commercial break.
“Alright, this is not going as planned. We were told it would be a very limited number of opening statements and it seems to be getting out of control,” the CNBC co-anchor explained.
This video is from CNBC, broadcast Feb. 25, 2009.
Download video via RawReplay.com
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