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Thank you very much the battle inside the beltway heating up and it is crunch time for congress to reach a deal on tax hikes and spending cut.
-- a grand bargain be reached by our elected officials joining us now is congressman.
Ron Paul congressman Paul good to see you thanks for coming -- It is the news of the day we also -- -- get a little monetary policy I'd like to know why you think gold is hasn't popped up since the president was reelected but.
Let's first talk about the fiscal cliff.
I think everybody would agree better economy is growing too slowly.
The only even if the president all of us tax hikes in -- it would only get him.
Eighty billion dollars a year that sounds like a lot but compared to a one trillion dollar deficit it is not that still leaves 92% of the deficit -- for.
Year by year.
On the other -- if you grow the economy you could be talking about hundreds of billions of dollars increased in today amount of money that your treasury gets so.
Why would he go for the tax increases rather than tax cuts that might stimulate the economy.
He must have a different understanding of economics then -- not have that.
Raising taxes does not necessarily you know produce more revenues if I even heard it.
So I think you think -- from a different perspective that keynesian they're taught that you raise taxes that you need more money.
And I just because that -- the economy and tax rate tax collections go down and they don't seem to have realize that.
But I don't expect a whole lot of beneficial things to happen between that between now on the beginning the year and -- just gonna pass the -- cola.
-- -- longer and worry about the real problems later on like you point out.
They're barely touching a problem in even the cuts that they're talking about that would you wind cute affect.
Aren't even real concert just cats and proposed increases so we're not getting anywhere close to talking about the real issue -- -- real issue.
Is the country's bankrupt and a the economy is too weak to pay for it is some days -- and -- -- -- -- the wake up and do some serious changes like actually cut for real spending.
Now that's an interesting point because they've done a bunch of studies of course recently because so much of the microscope is focused on this.
That even the spending cuts of -- hundred billion that there are looking at.
Really end up being a wash when you look at that with the rise in -- expenses the rising expenses and inflation is just going to make the cuts pretty much dead even so what.
What -- get us back into what we had during President Clinton and that was surplus.
Don't think we can do that any longer and asked -- -- talk about what I think we're past that pointer over the -- They just tinkering around the edges edges -- Having the economy stimulated a sort of -- over.
Because I think we're we're past that point I think it's much more major structural -- -- -- think.
We have to change our foreign policy we have to change our monetary policy we have didn't change our entitlement system we have to admit that we don't have 222.
For the entitlement system.
In there we're nowhere close even talking about that we're talking about.
You know eighty billion dollar account here and there.
So that's why I think we'll just postpone the inevitable and kill a much bigger crisis comes.
In that could come any time but don't -- count next year or so and then we will be forced to do it because people will start rejecting the mining and interest rates -- crop up.
Don't quit buying our debt and there will be no other choice -- thrust of face up to the reality is that we're we're broke.
Well one thing that we have to face up to is the enormous increase in spending at that began with President Obama I mean he increase first it was the 800 billion dollars stimulus which was supposed to be a one shot deal.
But he's carried that over year after year and that's why we have.
A trillion dollar deficit for the past four years including the last fiscal year that just ended at the end of September so that 800 billion that was supposed to be a one time shot for the economy.
Has turned into a bottom line budget.
Going year after year ever since.
But it seems like the American people said well don't cut my spending I want reassurance I want you keep bailing out the auto industry and I wanted to keep sending well yeah yeah.
And so it does continue but if he thought that was I had I don't.
Believe that -- -- -- -- -- -- the American people I think it's lack of understanding of economics that he doesn't see that is a danger.
I keep in spending masses so therefore he's not admitting the truth -- not how serious this.
We only a little bit of time -- -- -- really like your solution to this you said double just kicking the can down the road and wait for another crisis but if you weren't charged one would start as you said.
Philosophical changes you said really re doing how we look at international relations of these -- -- Yes chopped up and chop chop defense yes chopper entitlements.
I would chopped defense about job militarism and I'd start bringing the troops out in get rid of the -- -- that we just mind our own business.
But we could change -- rules with -- failed to congress tomorrow could pass a law.
And say that -- dad can't monetize debt but interest rates go up in that all of a sudden would adapt change the whole picture I think you'd have market rates of interest.
And the market rate of interest is very very important interest.
But we don't have that we have only -- was -- because we -- artificially low interest we have artificially low interest now.
Banks get all this money for free and I put it back in the -- -- there was -- -- is artificial.
So I would -- restore the market must sound money.
-- -- -- -- -- Go after the entitlement system.
But nobody's ready for that neither side is ready for that -- now not only -- the Republicans are talking about.
Not real cuts that raise taxes -- -- goats.
I've sort of done that for a few years I started when it was 35 dollars and outsell I don't know politically yeah I'm half thank you congressman good to see you to see you thanks I congressman target all work.
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