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We've Defaulted Before...

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    Judge Andrew Napolitano explains how the fear mongering on the debt ceiling is unwarranted.

  • Duration 5:19
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Does the government work for us that are we work for the government.

Has the federal government ever defaulted on its obligations before and -- so.

Why are the White House and Democrats in congress setting up an Armageddon like scenario if the government -- -- borrow more money.

Tonight debt and the end of government as we -- During the last few weeks lawmakers desperate to acquire more of your tax dollars have to borrow more money from the Federal Reserve and from the Chinese.

Have floated multiple plans to the American people to accomplish several major goals to raise taxes to cut spending.

And to increase the government's debt.

All the plans floated by the president and the leadership from both houses of congress on both parties would let the federal government borrow cash billions more dollars.

You see the government is so dependent on debt that it displays all the signs of a junkie.

If it gets a hold of more revenue in the -- of raising taxes it wants to ensure a steady supply of this intoxicating narcotic in the future.

Even though the American people are desperate to put the -- into rehab.

The politicians in Washington and have a very serious problem they simply cannot resist the temptation to spend.

They also have a problem with the truth the United States has defaulted on debt obligations before.

In 1934 when FBR -- He could write the laws as well as enforce them.

The government banned the ownership of gold points and eliminated the rights of Americans to convert their gold certificates and -- points -- cash.

The government then devalued the savings of all Americans by about 40% by reevaluating the price of gold.

Basically the federal government -- all Americans to sell their gold points to the treasury.

For 25 dollars an ounce and then it sold that -- to foreign investors for 35 dollars an ounce.

That's every American was subject to the immediate pain and government engineered loss of value of their assets.

You think that losing almost half of your life savings would feel like a default.

The government didn't call this a default and it didn't admit to what's -- it called at a loss of quote convert ability.

And even though Americans felt a loss the government still offered citizens of other countries the right to convert their Paper dollars into gold.

That default was brought to us by the Democrats under FDR.

Another default occurred in 1968.

At the height of the of the Vietnam War the federal government saw -- to defraud those who held silver certificates.

And everyone who put their money into the treasuries convertibles silver -- notes they lost everything.

The government defaulted on its obligations to pay on the notes that it issued.

That default what brought to -- by the Democrats under LBJ.

The third default recent default occurred when the federal government finally -- that it's foreign gold obligations.

In 1971.

President Nixon famously famously declared quote we're all Canadians now.

And the legal and constitutionally required relationship between the value of the dollar.

And it fixed amount of a precious metal was over.

No foreign holder of gold certificates would be paid.

The default was papered over and today we live in a world where a little cup -- -- money bachelor's at the Federal Reserve.

Can't control the amount of cash in circulation.

And what that cash is worth.

That default was brought to us by Republican.

And -- next.

So despite the fear mongering on Capitol Hill despite the rhetoric about the repeated raising of the debt ceiling in the past.

The federal government has defaulted before and it has recovered from the recessions and depressions that have -- past.

However papering over this recession is not going to cure this recession.

There can be no more cards played by the printing presses to pump money into the system to restore our broken economy.

With the government now spending 65%.

Of gross domestic spending the time has come again for default.

The president if He cares about the nation will tell the creditors of the United States the Chinese the Japanese the Germans even the Federal Reserve.

That as a gesture of our gratitude.

For years of charity through taxation.

By subsidizing their militaries and -- their once hungry.

We will kindly reneged on our debts in exchange for the last century of foreign aid we have given.

In fact the money never was properly in the hands of politicians in Washington to spend in the first place.

And with respect to the Fed congressman Ron Paul was recently pointed out nearly two trillion.

Of the fourteen point three trillion in national debt is owed to the government's own bank that would be the Federal Reserve.

That should be defaulted first its money the government owes itself.

You have a choice this one the president just simply wants to avoid is to shrink the government.

To recognize that we can no longer afford the entitlement programs that FDR and LBJ visited upon us that Nixon's ignorance of the basic laws of economics.

Can no longer guide us.

If the constitution means what it says that that is -- supreme law of the land.

If we are entitled to a government that stays within it's confines that we should stop spending what we don't have stop taxing generations as yet on board.

And returned to a federal government.

Whose first obligation is not to keep us wealth ever healthy.

But to keep a straight.

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