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The Spectacle Blog
Liberals are getting fired up about statements Gov. Rick Perry made last night about Fed chairman Ben Bernanke. Here is what he said, in a video with an inflammatory name:
His words were:
If this guy prints more money between now and the election, I don’t know what y’all would do to him in Iowa, but we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in American history is almost treacherous, or treasonous, in my opinion.
Perry is responsible for his own words. If Joe Biden or other members have engaged in reckless or beyond-the-pale rhetoric (e.g., “terrorists”), that doesn’t excuse Perry to do the same.
Here’s the question I’d like to see Perry asked:
Your predecessor as governor of Texas, George W. Bush, appointed Ben Bernanke to the Fed in 2006. In 2008, during an election year in which the Republican incumbency was threatened, Bernanke effectively doubled the monetary base. In other words, he more or less printed money on a massive scale. Was that “almost treasonous”? If so, what is Bush’s culpability, given that he knew beforehand from Bernanke’s academic work that he would print money in response to a financial crisis?
Perry obviously wasn’t ready to field this question about the Fed, and made a allusion that he probably didn’t intend and which his political detractors immediately seized on. It would be easy enough to correct, and then move on.
View all comments (19) | Leave a comment
More Blog Posts by Joseph Lawler
http://spectator.org/blog/2011/08/16/was-bernanke-treasonous-in-fal
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Bob Grant| 8.16.11 @ 9:33AM
Folks, this is what to expect from Perry.
TEXAS cockiness........................... oy!
Enough already.
Is it too late for Haley Barbour to get back in??
Sean| 8.16.11 @ 9:44AM
This is classic Perry. He is taking Ron Paul's stand on the FED printing money. In truth Perry the Bilderberg attendee has no problem with it. Perry talks one way and goes the other. This will fool most of the people.
Mary Mayes | 8.16.11 @ 9:44AM
Sorry, I don't have a problem with his statement.
A Balrog of Morgoth| 8.16.11 @ 9:54AM
"In 2008, during an election year in which the Republican incumbency was threatened, Bernanke effectively doubled the monetary base. "
Uh, wasn't there a bit of shock involved there, what with investment banks and such imploding? I have a vague recollection of a bunch of politicians coming out of a meeting looking like they just found out they had inoperable brain cancer.
Somewhat different context here, I think.
Jocon307 | 8.16.11 @ 10:44AM
Yes, you are right. And to say the "republican incumbency" was threatened is a little wiggly.
The republicans had already lost the house and the senate and Bush wasn't running for re-election. So that leaves candidate McCain as the "incumbent", which is a bit of a stretch.
I'm sure all the Bushes are loyal GOPers but despite all the awful things said about W. I don't think he would have diluted the dollar to help John McCain win.
Clearly it didn't help him, in any event.
Chuck| 8.16.11 @ 10:29AM
JFK saw the threat of the FED during his administration. On 6/4/1963 Kennedy signed an executive authorizing the Treasury Department to start printing debt-free US Treasury notes aka silver certificates in lieu of debt-ridden Federal Reserve notes. The amount printed equaled the value of silver in US vaults. When Kennedy died five months later the new president took the silver certificates out of circulation. Printing money without anchoring it to a commodity with intrinsic value has led to the current fiscal situation. Also coining money with base metals (1965) instead of gold and silver has also contributed to the problem. Kennedy had it right and so does Perry.
Wayne | 8.16.11 @ 11:34AM
We are still suffering from the treasonous LBJ.
Gold BC| 8.16.11 @ 10:44AM
The US Constitution authorizes Congress to coin money and regulate the value thereof also punishment counterfeiting the current coin as in metal and minting. Therefore the Constitution does not allow for the printing of currency and a central bank to regulate the value thereof. A case can be made that the printing of Federal Reserve notes is unconstitutional and counterfeiting resulting in the abolishment of the FED and the rescindment of the 1965 Coinage Act returning to gold and silver coins as the US currency.
Solo| 8.16.11 @ 12:25PM
The gold standard is a pipe dream.
Moreover...under the Implied Powers Doctrine, Congress is authorized to establish any institution (public or private--and that includes Private Banks) in order to fulfill their Constitutional obligations.
Also...there is no Constitutional requirement for our currency to be based in Gold or Silver--only a clause requiring the States to pay their debts in gold or silver coin (admittedly...a pretty sticky situation given current practices)..
Remember, too, that the "Halcion Days" of the Gold Standard weren't so hot. Multiple full-blown depressions were suffered under the Gold standard (as result of what is known as Gold's notorious "price Stickiness") and yet none have been suffered since abandoning what has been referred to as "That barbarous system" .
Also...the gold standard was subject to all manner of political mischief. Back in the 30's, the price of Gold had been fixed at around $26.00 for many decades, even though on the world market, the price had risen to over $36.00.
FDR made the private possession of gold illegal. He seized all the privately held gold, allowed the gold price to "float" at international values and then printed enough in dollars to deflate the currency back to its original value--thus rendering a 67% tax on the previous gold owners. In other words....he stole their wealth so he could fund his "New Deal" projects.
Lastly....there isn't enough gold on the earth to properly represent the real wealth (wealth derived by human "work") of what has been accumulated since going off the gold standard.
The resulting deflation from such a foolish move would put our economy back to the Dark Ages.
Gold, in and of itself, is not money. It's a commodity...just like pork bellies or frozen orange juice.
"Money" is whatever we are willing to trade in exchange for our "work". Granted, gold is a better exchange medium than is pork bellies, but it is not the only means of establishing the value of currency.
Cris Worth| 8.16.11 @ 4:12PM
A few points you missed. The worst of the Great Depressions began in 1929 and lasted until WWII. Ironically enough the FED came into existence in 1913 and the current FED chief himself said the FED was responsible. Also the total devaluation of US currency pre-FED (1776-1912) 6% in comparison to the total devaluation of US currency post-FED (1913-present 99%, 25% devaluation in the past decade. The creation of the FED and the permanent federal income tax (1913) has benefited a few and hurt the vast majority. Since 1965, a massive buildup in debt coupled with inflation and further devaluation of the currency by the introduction of based metal coins and reckless printing of Federal Reserve notes has left this country with few choices to remediate therefore facing economic collapse.
axbucxdu| 8.17.11 @ 1:09PM
"...Lastly....there isn't enough gold on the earth to properly represent the real wealth (wealth derived by human "work") of what has been accumulated since going off the gold standard.
The resulting deflation from such a foolish move would put our economy back to the Dark Ages..."
This fact neither justifies the Fed's existence nor the use of fiat money.
However, it is IMPERATIVE that a score be kept that is at once representative of that real wealth and also independent of politics. To that end, the money in circulation should be reduced to a purely technical decision that is taken at the local or regional level.
There are historical examples of such systems: Free Banking. For example, in its Free Banking heyday, the Scottish banking system circulated notes with as little as 3% specie backing with no impact to monetary stability.
In other words, in order to form a monetary system that is both technical and apolitical it is unecessary that commodity backing, in whatever form it takes (gold, copper, nickel, rotten tomatoes, etc.), be equal to real wealth. It is sufficient only that that system be backed by real assets.
Let the certificates representing that stock ebb and flow according to the results of local clearinghouse operations, and the rest takes care of itself: No Fed, and no gold, required.
Brad| 8.16.11 @ 10:55AM
So funny the pundits have all their panties in a wad over this. I would venture to say a large majority of Americans have no issue with this. Ron Paul is getting most of his traction from this one issue, I see no reason not to bring it out into the open.
PattyMor| 8.16.11 @ 10:58AM
The Federal Reserve is a private bank which controls our currency. Does this make sense? No it doesn't, but I would guess that this was the opening salvo the Bilderberg's made on the U.S. Constitution. We are drowning in debt, deficits, and excess currency.
JimH| 8.16.11 @ 12:49PM
A great analysis of how paper money works and a great read besides is Making Money by Terry Pratchett.
Milton Quaffalot| 8.16.11 @ 1:00PM
It's kinda sad to see what's happened to Liberals. They used to anti-establishment, now they're defenders of the Chairman of the Federal Reserve.
GregMan| 8.16.11 @ 1:13PM
I wouldn't have used the word "treasonous" but I can see his point. The word can be applied to a great many of the things liberals do, and have done. It would be a step in the right direction to bring the word "treason" back into the public discourse.
RogerCfromSD| 8.16.11 @ 1:34PM
I think it is treasonous that the Fed is never audited.
ml| 8.16.11 @ 2:53PM
I don't have a problem with his statement. Perry is right Bernanke need to be replace. Bernanke did supported Obama's stimulus (job) plan two years ago after Obama won the election in 2008. The stimilus doesn't work to solve the economy. Everything went up plus they raised the debt ceiling last week when the Congress passed the bill. And I think the Fed is never audited. It is treasonous.
Ken (Old Texican)| 8.16.11 @ 3:19PM
Uh,
I couldn't read any "violence" into Perry's remarks.
Some folks are being stupid.