Ron Paul

Mr. PAUL

Mr. PAUL. Mr. Chairman, I yield myself such time as I may consume. (Mr. PAUL asked and was given permission to revise and extend his remarks.)

Mr. PAUL

Mr. PAUL. Mr. Chairman, I rise in opposition to this legislation, which makes ``emergencies'' out of non-emergencies and fails to provide assistance to my home State of Texas, which did suffer an emergency in the form of Hurricane Rita last summer. First, I should note to my colleagues and the American taxpayer that, at almost $92 billion, this is the largest supplemental appropriations request in the history of the U.S. Congress. Is it really an emergency to send $1.2 billion to pay off our allies for their help in Afghanistan? Won't these countries in close proximity presumably benefit more than even we will from the stability that we are told U.S. troops will provide? Perhaps these countries should be paying us for stabilizing their neighborhood. But no, it is always the U.S. taxpayer who ends up paying. Is $36 million more for taxpayer-funded broadcasting programs overseas really an emergency? Is $30 million to build roads in Liberia an emergency, when roads in Texas are still unrepaired after Hurricane Rita? Mr. Chairman, I am offering an amendment to this ``emergency'' supplemental that reduces some of the non-emergency ``emergencies'' by $500 million and allocates that money for the recovery of the State of Texas from Hurricanes Katrina and Rita. Additionally, my amendment will take another half-billion dollars from the non-emergency portions of this bill and apply it toward the Federal deficit. The real emergency is the rate that this government is spending money we do not have on policies that we cannot afford while ignoring what should be our real priorities.

Mr. PAUL

Mr. PAUL. Mr. Speaker, America lost a great champion of liberty when Harry Browne passed away on March 1, at the age of 72. Harry had a passion for liberty and knowledge of a wide variety of subjects. His communication style, as he himself so marvelously put it, focused on converting his opponents rather than winning the argument. These attributes helped make him one of the most effective proponents of the freedom philosophy I have had the privilege of knowing. Harry's numerous books and columns, his radio and Internet broadcasts, and his speeches educated millions in sound economics and the benefits of a free society. Harry motivated many people to become activists in the movement to restore American liberties. Harry first came to public attention in the 1970 when he penned a best-selling investment book, How You Can Profit From the Coming Devaluation, which foresaw President Richard Nixon's abandonment of the gold standard and the ways the American economy would be damaged by the inevitable resulting inflation. Harry's book helped many Americans survive, and even profit, during the economic troubles of the seventies. It also introduced millions of people to the insights developed by followers of the Austrian school of economics regarding the dangers fiat currency poses to both prosperity and liberty posed by fiat. How You Can Profit From the Coming Devaluation is generally recognized as the founding document of the hard money movement, which combined the insights of the Austrian economists with a practical investment strategy. Harry's third book, You Can Profit from a Monetary Crisis, reached number one on the New York Times bestseller list. Other popular books by Harry include How I Found Freedom in an Unfree World, The Great Libertarian Offer, and Why Government Doesn't Work. I was pleased to write the foreword for one of Harry's books, Liberty A-Z: Libertarian Soundbites You Can Use Right Now, a collection of direct, thought- provoking, and often humorous responses to the questions advocates of the freedom philosophy face. During the nineties, Harry worked to advance liberty as a presidential candidate, columnist, radio talk-show host, and columnist. He also hosted an internet-based talk show and founded DownsizeDC, a grassroots advocacy group whose goals are accurately summed up in its title. Even while struggling with Lou Gehrig's disease, Harry maintained a full schedule of writing, hosting his radio show, and speaking around the country. Harry's efforts were not limited to the economic realm. He understood the threat to liberty and prosperity posed by global crusades for democracy, as well as the importance of opposing restrictions on civil liberties. Harry's outspoken defense of civil liberties and the Framers' foreign policy of nonintervention took on added importance in the last years of his life when too many self-styled advocates of liberty attempted to curry favor with the political establishment by focusing solely on issues of economic liberty or combined advocacy of low taxes and regulations with active support for militarism and restrictions on personal liberty. In all his educational, financial, and political work Harry served as a model for everyone who works for the free society. Harry was principled and uncompromising in message, while temperate and respectful of differing opinions in delivery. He avoided the histrionics too common in our today's talk show culture, and he never personalized his arguments. Even when an opponent resorted to ad hominem attacks, Harry always kept his presentation on the high ground of ideas and principles. In conclusion, Mr. Speaker, I extend my sympathy to Harry Browne's wife, Pamela, and daughter Auburn, as well as the many he befriend in his years in the freedom movement, and I pay tribute to Harry Browne for his lifelong efforts on behalf of individual liberty.

Mr. PAUL

Mr. PAUL. Mr. Chairman, my amendment is very simple. I thought it would be very noncontroversial, because it merely sunsets our provision. We have just gone through a period of time of 2 years where there has been no authorizations, but we have done appropriations as necessary. The amendment merely says, this act shall not be in effect after September 30, 2011. So that is 5 years, which I think is very adequate. But I would want to express my agreement with the authors of this particular bill, because we do have a very serious problem in this country with drugs. I, as a physician, am very much aware of the seriousness of it. I also agree that prescription drugs are probably every bit as bad or much worse, because there is so much dependency on psychotropic drugs. But, nevertheless, I come down on the side of saying no matter how good legislation like this is, it backfires; there are too many unintended consequences. In such a short period of time, all I can suggest to my colleagues is that prohibition in the ultimate sense was tried with alcohol. And alcohol is still now a severe problem in this country. And we knew that Prohibition produced many more problems than the alcohol itself. I think that is true with drugs. I think we have allowed ourselves to be carried away, to a large degree, because now we have laws that lack compassion. We do know, in the medical field, that marijuana can be helpful to cancer patients and AIDS patients can be helped where our drugs are not helpful; and to me this is just sad that we override State laws that permit it. The overwhelming number of people in the country now are saying that we ought to allow marijuana to be used for very sick patients. Not too long ago, just this week, I had a meeting with a student that came from a central Asian country. He was an exchange student. He says the big subject at his school was, what is the age limit when I can drink alcohol? They would ask him that and he said, there is no age limit. So I asked him, I said, is there a drinking problem in your country? And he says no. He says it is uneventful. It is the excitement of something being illegal that actually makes the problem a lot worse. And even in our country, we had a grand experiment from the beginning of our country up until about 35 years ago. We had very few of these laws. Yet all we can notice now is that we have spent, in today's dollars, over $200 billion in the last 35 years, and we do not have a whole lot to show for it. So I would grant you there is a serious problem. We should do whatever we can to help. I just do not think more legislation is required. Mr. Chairman, I reserve the balance of my time.

Mr. PAUL. Mr. Chairman, I yield 1\3/4\ minutes to the gentlewoman from California (Ms. Waters).

Mr. PAUL. Mr. Chairman, I offer an amendment.

Mr. PAUL. Mr. Chairman, I yield myself the balance of my time. Mr. Chairman, earlier I mentioned that prohibition was a total failure with alcohol and that it is very similar, and I think the gentleman from Indiana helped make my point. He is a bit frustrated with the enforcement of the laws on the books, and for what reason I do not know, but we certainly ought to be frustrated with the results. But the laws are difficult to enforce and I understand and sense his frustration with this. One of the major reasons why I object to this approach is not only the cost. The cost is pretty important and I think it is pretty important to realize it does not work very well, if at all; but we also ought to look at the damage done with our mistaken thoughts that this is doing a lot of good. Once a war is declared, whether it is a war overseas or whether it is a domestic war on some evil here, that is when the American people should look out for their civil liberties. There, the issue of privacy is attacked. So now we have a war on terrorism and we have the PATRIOT Act and all these other things that intrude on the civil rights and civil liberties of Americans, and, at the same time, not achieving a whole lot of good results. This is what happens when there is a war on. Those people who are trying to avoid taxes, all law-abiding citizens have to obey all these laws. So as soon as there is a war, look out for your civil liberties and your privacy. The war on drugs has done a great deal of harm to our right of privacy. Once again, I agree with the argument, there are a great deal of problems in this country with the illegal use of drugs, but what I am saying is it does not help to have this type of a war on drugs because it tends to distort things. It raises prices artificially high. It causes all kind of ramifications that actually cause more killing and dying. This is why prohibition of alcohol was stopped, because people died from drinking bad alcohol, and the gangs sold the alcohol. The same thing happens today. Like I mentioned, that student that lived in the country, and he was 16 years old, and there were no rules or laws against teenagers drinking beer or alcohol and there was no problem. Kids did not drink. It was not exciting to do it. So there is a certain element of truth to that. Kids smoking cigarettes is against the law. You sneak off and smoke cigarettes. That happens to be what teenagers do. So no matter how well-intended legislation like this is, it tends to have too many unintended consequences, it costs too much money. And we fail to realize that we in this country live with a greater amount of personal liberty and respect for State and local law enforcement, we had less drug problems. Think about it. Through the latter part of the 18th century, the 19th century, the early part of the 20th century, essentially no laws, and we had a lot less problems. Mr. Chairman, I yield back the balance of my time.

Mr. PAUL. Mr. Chairman, how much time do I have remaining?

Mr. PAUL. Mr. Chairman, I demand a recorded vote.

Mr. PAUL. Mr. Chairman, I yield myself 2\1/2\ minutes. (Mr. PAUL asked and was given permission to revise and extend his remarks.)

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise to introduce the Sunshine in Monetary Policy Act, which requires the Federal Reserve to resume reporting the monetary measure known as M3. M3 consists of M1 (M1 is currency in circulation plus travelers' checks, demand deposits, Negotiable Order of Withdrawal (NOW) accounts, and similar interest-earning checking account balances) plus M2 (M2 is M1 plus household holdings of savings deposits, small time deposits, and retail money market mutual funds balances except for balances held in IRA and Keogh accounts) plus institutional money market mutual fund balances and managed liabilities of deposits consisting of large time deposits, repurchase agreements, and Eurodollars. The Federal Reserve Board has recently announced it will stop reporting M3, thus depriving Congress and the American people of the most comprehensive measure of the money supply. The cessation of Federal Reserve's weekly M3 report will make it more difficult for policymakers, economists, investors, and the general public to learn the true rate of inflation. As Nobel laureate Milton Friedman famously said, ``inflation is always and everywhere a monetary phenomenon.'' Therefore, having access to a comprehensive measure of the money supply like M3 is a vital tool for those seeking to track inflation. Thorsten Polleit, honorary professor at HfB-Business School of Finance and Management, in his article ``Why Money Supply Matters'' posted on the Ludwig von Mises Institute's website mises.org, examined the relationship between changes in the money supply and inflation and concluded that ``money supply signals might actually be far more important for inflation--even in the short-term--than current central bank practice suggests,'' thus demonstrating the importance of the M3 aggregate. The Federal Reserve Board has claimed neither policymakers nor the Federal Reserve staff closely track M3. Even if M3 is not used by Federal Reserve Board economists or legislators, many financial services professionals whose livelihoods depend on their ability to obtain accurate information about the money supply rely on M3. For example, my office has been contacted by a professional money manger complaining that the Federal Reserve Board's discontinuing M3 reports will make it difficult for him to do his job. Whatever lack of interest policymakers are currently displaying in M3 is no doubt related to the mistaken perception that the Federal Reserve Board has finally figured out how to effectively manage a fiat currency. This illusion exists largely because the effects of the Fed's inflationary polices are concentrated in malinvestments in specific sectors of the economy, leading to ``bubbles'' such as the one that occurred in the stock market in the late nineties and the bubble that many believe is occurring in the current real estate market. When monetary inflation is reflected in sector-specific bubbles, it is easier to pretend that the bubbles are caused by problems specific to those sectors, instead of reflecting the problems inherent in a fiat currency system. Once the damage to our economy done by our reliance on fiat currency becomes clear, I am certain that policymakers will once again take more interest in M3. Economists and others who are following M3 have become increasingly concerned about inflation because last year the rate of M3 rose almost twice as fast as other monetary aggregates. This suggests that the inflation picture is not as rosy as the Federal Reserve would like Congress and the American people to believe. Discontinuing reporting the monetary aggregate that provides the best evidence that the Federal Reserve Board has not conquered inflation suggests to many people that the government is trying to conceal information about the true state of the economy from the American people. Brad Conrad, a professor of investing who has also worked with IBM, CDC, and Amdahl, spoke for many when he said, ``It [the discontinuance of M3] is unsettling. It detracts from the transparency the Fed preaches and adds to the suspicion that the Fed wants to hide anything showing money growth high enough to fuel inflation...'' Discontinuing reporting M3 will only save 0.00000699% of the Federal Reserve Board's yearly budget. This savings hardly seems to justify depriving the American people of an important measurement of money supply, especially since Congress has tasked the Federal Reserve Board with reporting on monetary aggregates. Discontinuing reporting M3 may not be a violation of the letter of the Federal Reserve Board's statutory duty, but it is a violation of the spirit of the congressional command that the Federal Reserve Board ensure the American public is fully informed about the effects of monetary policy. Mr. Speaker, knowledge of the money supply is one of the keys to understanding the state of the economy. The least the American people should expect from the Federal Reserve Board is complete and accurate information regarding the money supply. I urge my colleagues to ensure that the American people can obtain that information by cosponsoring the Sunshine in Monetary Policy Act.

Mr. PAUL

Mr. PAUL. Madam Speaker, contrary to its proponents' claims, S. 2271 fails to address the constitutional flaws in the PATRIOT Act or protect innocent Americans against future abuses of their civil liberties. Rather, passing this bill makes the permanent authorization of most of the act inevitable. Therefore, I urge my colleagues to vote against S. 2271 in order to force the House and Senate to craft a new legislation giving the government the tools necessary to fight terrorism without sacrificing constitutional liberties. The Chairman of the Senate Judiciary Committee essentially admitted that S. 2271 does nothing to address the core concerns constitutionalists and civil libertarians have with the PATRIOT Act. In fact, he has announced his intention to introduce his own PATRIOT Act reform bill! However, if S. 2271 passes and PATRIOT Act extension becomes law, it is highly unlikely that this Congress will consider any other PATRIOT Act reform legislation. USA Today's Editorial of March 1, ``Patriot Act `compromise' trades liberty for safety,'' accurately describes how people concerned about individual liberty should react to S. 2271's ``reforms'': ``Big Deal. By any standard of respect for the Bill of Rights, those provisions never should have been in the law in the first place. What is it about the Fourth Amendment (`The right of the people to be secure . . . against unreasonable searches and seizures shall not be violated') that Congress doesn't get?'' Among S. 2271's flaws are provisions restricting recipients of a ``gag'' order regarding government seizure of private records from seeking judicial review of such orders for a year and requiring that recipients prove government officials acted in ``bad faith,'' a ridiculously high standard, simply to be able to communicate that the government has ordered them to turn over private records. The bill also requires that recipients of National Security Letters, which can be abused to sidestep the requirements of the Fourth Amendment, provide the FBI with the names of any attorneys from whom they have sought legal counsel from. S. 2271 would thus prohibit a National Security Letter recipient from even asking a lawyer for advice on complying with the letter without having to report it to the FBI. In fact, S. 2271 requires National Security Letter recipients to give the FBI the names of anyone they tell about the letter. This provision will likely have a chilling effect on a recipient of a National Security Letters ability to seek legal advice or other assistance in challenging or even complying with the National Security Letter. Madam Speaker, S. 2271 does not address the fundamental constitutional problems with the PATRIOT Act. To the contrary, S. 2271 will make most of the PATRIOT Act's dramatic expansions of federal power a permanent feature of American life. Therefore, I urge my colleagues to reject this bill and work to ensure government can effectively fight terrorism without sacrificing the liberty of law- abiding Americans.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise today to introduce the Treat Physicians Fairly Act, legislation providing tax credits to physicians to compensate for the costs of providing uncompensated care. This legislation helps compensate medical professionals for the., costs imposed on them by federal laws forcing doctors to provide uncompensated medical care. The legislation also provides a tax deduction for hospitals that incur costs related to providing uncompensated care. Under the Emergency Medical Treatment and Active Labor Act (EMTALA) physicians who work in emergency rooms are required to provide care, regardless of a person's ability to pay, to anyone who comes into an emergency room. Hospitals are also required by law to bear the full costs of providing free care to anyone who seeks emergency care. Thus, EMTALA forces medical professionals and hospitals to bear the entire cost of caring for the indigent. According to the June 2/9, 2003 edition of AM News, emergency physicians lose an average of $138,000 in revenue per year because of EMTALA. EMTALA also forces physicians and hospitals to follow costly rules and regulations. Physicians can be fined $50,000 for technical EMTALA violations! The professional skills with which one's earns a living are property. Therefore, the clear language of the Takings Clause of the Fifth Amendment prevents Congress from mandating that physicians and hospitals bear the entire costs of providing health care to any group. Ironically, the perceived need to force doctors to provide medical care is itself the result of prior government interventions into the health care market. When I began practicing medicine, it was common for doctors to provide uncompensated care as a matter of charity. However, laws and regulations inflating the cost of medical services and imposing unreasonable liability standards on medical professionals even when they where acting in a volunteer capacity made offering free care cost prohibitive. At the same time, the increasing health care costs associated with the government-facilitated overreliance on third party payments priced more and more people out of the health care market. Thus, the government responded to problems created by its interventions by imposing the EMTALA mandate on physicians, in effect making health care professionals scapegoats for the harmful consequences of government health care polices. EMTALA could actually decrease the care available for low-income Americans at emergency rooms. This is because EMTALA discourages physicians from offering any emergency care. Many physicians in my district have told me that they are considering curtailing their practices, in part because of the costs associated with the EMTALA mandates. Many other physicians are even counseling younger people against entering the medical profession because of the way the Federal Government treats medical professionals. The tax credits created in the Treat Physicians Fairly Act will help mitigate some of the burden government policies place on physicians. The Treat Physicians Fairly Act does not remove any of EMTALA's mandates; it simply provides that physicians can receive a tax credit for the costs of providing uncompensated care. This is a small step toward restoring fairness to physicians. Furthermore, by providing some compensation in the form of tax credits, the Treat Physicians Fairly Act helps remove the disincentives to remaining active in the medical profession built into the current EMTALA law. I hope my colleagues will take the first step toward removing the unconstitutional burden of providing uncompensated care by cosponsoring the Treat Physicians Fairly Act.

Mr. PAUL

Mr. PAUL. Mr. Speaker, Supreme Court Justice Louis Brandeis famously said, ``Sunlight is the best disinfectant.'' In order to shine sunlight on the practices of the House of Representatives, and thus restore public trust and integrity to this institution, I am introducing the sunlight rule, which amends House rules to ensure that Members have adequate time to study a bill before being asked to vote on it. One of the chief causes of increasing public cynicism regarding Congress is the way major pieces of legislation are brought to the floor without Members having an opportunity to read the bills. This is particularly a problem with the Appropriations conference reports, which are often rushed to the floor of the House in late-night sessions at the end of the year. For example, just this past December, the House voted on the Fiscal Year 2006 Defense Appropriations Conference Report at approximately 4 a.m.--just 4 hours after the report was filed. Yet, the report contained language dealing with avian flu, including controversial language regarding immunity liability for vaccine manufacturers, that was added in the House-Senate conference on the bill. Considering legislation on important issues in this manner is a dereliction of our duty as the people's elected representatives. My proposed rule requires that no piece of legislation, including conference reports, can be brought before the House of Representatives unless it has been available to Members and staff in both print and electronic version for at least 10 days. My bill also requires that a manager's amendment that makes substantive changes to a bill be available in both printed and electronic forms at least 72 hours before being voted on. While manager's amendments are usually reserved for technical changes, oftentimes manager's amendments contain substantive additions to or subtractions from bills. Members should be made aware of such changes before being asked to vote on a bill. The sunlight rule provides the people the opportunity to be involved in enforcing the rule by allowing a citizen to move for censure of any House Member who votes for a bill brought to the floor in violation of this act. The sunlight rule can never be waived by the Committee on Rules or House leadership. If an attempt is made to bring a bill to the floor in violation of this rule, any member could raise a point of order requiring the bill to be immediately pulled from the House calendar until it can be brought to the floor in a manner consistent with this rule. Mr. Speaker, the practice of rushing bills to the floor before individual Members have had a chance to study the bills is one of the major factors contributing to public distrust of Congress. Voting on bills before Members have had time to study them makes a mockery of representative government and cheats the voters who sent us here to make informed decisions on public policy. Adopting the sunlight rule is one of, if not the, most important changes to the House rules this Congress could make to restore public trust in, and help preserve the integrity of, this institution. I hope my colleagues will support this change to the House rules.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I ask unanimous consent to take my Special Order at this time.

Mr. PAUL. Mr. Speaker, everyone knows our country is deeply in debt. Most Americans decry the rampant growth in government spending. Essentially, however, no one in Washington is concerned enough to do anything about it. Debt is like an addiction: the political pain of withdrawal keeps politicians spending, so they do not offend any special interest groups demanding that government benefits continue. As with all addictions, long-term dependency on a dangerous substance can kill the patient. Dependency on bad policy also can destroy the goose that many believe lays the golden egg. Our ever-increasing government expenditures, which perpetuate a runaway welfare/warfare state, simply are not sustainable. The fallacy comes from the belief that government can provide for our needs and manage a worldwide empire. In truth, government can provide benefits only by first taking resources from productive American citizens or borrowing against the future. Inevitably, government programs exceed the productive capacity of the people or their willingness to finance wasteful spending. The authority to accumulate deficits provides a tremendous incentive to politicians to increase spending. Total spending is the real culprit. The more government taxes, borrows, or inflates, the less chance the people have to spend their resources wisely. The way government spends money also causes great harm. By their very nature, governments are inefficient and typically operate as we recently witnessed with FEMA in Louisiana, Mississippi, and Texas over the last 6 months. Governments are bureaucratic, inefficient, and invite fraud. This is just as true in foreign affairs as it is in domestic affairs. Throughout history, foreign military adventurism has been economically harmful for those nations bent on intervening abroad. Our Nation is no different. Largesse at home and militarism abroad requires excessive spending and taxation, pushing deficits to a point where the whole system collapses. The biggest recent collapse was the fall of the Soviet Empire just 15 years ago. My contention is that we are not immune from a similar crisis. Today, our national debt is $8.257 trillion. Interestingly, the legal debt limit is $8.184 trillion. This means we currently are $73 billion over the legal debt limit. Creative financing Washington-style allows this to happen, but soon Congress will be forced to increase the national debt limit by hundreds of billions of dollars. Congress will raise the limit, quietly if necessary; and the deficit spiral will continue for a while longer. But this official debt figure barely touches the subject. Total obligations of the Federal Government, including Social Security and Medicare and prescription drugs, are now over $50 trillion, a sum younger generations will not be able to pay. This means the standard of living of a lot of Americans who are retired will decline sharply in the near future. Two vehicles are used to fund this wild spending. First, the Federal Reserve creates dollars out of thin air and purchases Treasury bills without limit, a very nice convenience. Second, foreign entities, mostly central banks, own $1.5 trillion of our debt. They purchased over $200 billion in just the last 12 months, increasing their holdings by 15 percent. This is a consequence of our current account deficit and the outsourcing of more and more American manufacturing jobs. Few economists argue that this arrangement can continue much longer. Excessive spending, a rapidly growing national debt, the Federal Reserve inflation machine, and foreign borrowing all put pressure on the dollar. Unless we treat our addiction to debt, it will play havoc with the dollar, undermine our economic well-being, and destroy our liberties. It is time for us to get our house in order.

Mr. PAUL

Mr. PAUL. Mr. Speaker, today I am introducing the Citizen Soldier Protection Act of 2006. This legislation will protect our American soldiers from being forced to serve under a United Nations or other foreign command and from being forced to wear the insignia of the United Nations or other foreign states. Mr. Speaker, there have been instances where members of the U.S. Armed Forces were compelled, without lawful authority, to serve under United Nations or other foreign command and to wear as part of their military uniform visible indicia or insignia of the United Nations and foreign states. This is absolutely unacceptable, as the Constitutional role of the United States Armed Forces is to protect the United States of America. It is the responsibility of the U.S. Congress to ensure that the men and women who sign up for the noble duty of defending our country do not end up serving under a foreign flag or foreign commander. And American soldiers certainly should not be forced to serve the sovereignty-destroying plans of the United Nations! I hope my colleagues will join me in defending our men and women in uniform by cosponsoring Citizen Soldier Protection Act of 2006.

Mr. PAUL

Mr. PAUL. Madam Speaker, I thank the gentlewoman for yielding me this time. I rise to express a note of caution regarding this resolution. I see this resolution somewhat like some of the resolutions that we debated and passed prior to our commitment to go into Iraq. As a matter of fact, some of the language is very similar. If you substitute the word ``Iraq'' for ``Iran,'' you would find out that these concerns are very similar. I do not quite have the concern that others have expressed that Iran is on the verge of having a nuclear weapon. They have never been found in violation. There has been a lot of talk and a lot of accusation, but technically they have never been found in any violation. My concern for this type of language and these plans is that nothing ever changes. This is the type of thing that occurred before. Of course, we went into Iraq, and yet today the success in Iraq is very questionable. Fifty-five percent of the American people say it was a mistake to have gone into Iraq. Only forty percent of the people support staying in Iraq. Attitudes have shifted now since the success in Iraq has been so poor. We went into Afghanistan to look for Osama bin Laden, and we sort of got distracted. We have forgotten about him just about completely. Instead we went into Iraq. Though the Iraq war is not going well, all of a sudden we are looking to take on another burden, another military mission. I find some things in the resolution that are very confrontational because it invokes sanctions. People say, well, sanctions are not that bad. That is no shooting or killing. But sanctions and boycotts and embargoes, these are acts of war. And, of course, many times our administration has expressed the sentiment that if necessary we are going to use force against Iran; we are going to start bombing. And why do we follow this policy? Especially since it literally helps the radicals in Iran. This mobilizes them. There is an undercurrent in Iran that is sympathetic to America, and yet this brings the radicals together by this type of language and threats. There is no doubt that our policy helps the hard-liners. There has been no talk, it has been implied, but there has been no serious talk that Iran is a threat to our national security. There is no way. Even if they had nuclear weapons, they are not going to be a threat to our national security. Pakistan, that is not a democratic nation. It happens to be a military dictatorship. They have nuclear weapons. India has nuclear weapons. As a matter of fact, the nuclear weapons serve as a balance of power between two countries. The Soviets, had 30,000 nuclear weapons, and we followed a policy of containment. We did not say we have to go into the Soviet Union and bomb their establishment. No. Finally that problem dissipated. And yet we create unnecessary problems for ourselves. We go looking for trouble, and I see this as very detrimental for what we are doing with this resolution. There is one portion of the resolution that concerns me about our urging the Russians and China to take a firm stand, and that has to do with the resolved clause No. 3; it says to the people of Russia and China to ``expeditiously consider and take action in response to any report of Iran's noncompliance'' in fulfillment of the mandate of the Security Council to respond and deal with situations . . . Any report? I mean, some report in the newspaper? Is it an IAEA report? Or whatever. That is so open-ended that this is a risky, risky resolution. I urge a ``no'' vote on this resolution.

Mr. PAUL

Mr. PAUL. Mr. Speaker, my Special Order tonight deals with the subject, the end of dollar hegemony. Mr. Speaker, 100 years ago it was called dollar diplomacy; after World War II and especially after the fall of the Soviet Union in 1989 the policy had all been to dollar hegemony. After all of this great success, our dollar dominance is coming to an end. It has been said, rightly, that he who holds the gold makes the rules. In earlier times it was readily accepted that fair and honest trade be required in an exchange of something of real value. First, it was simply barter of goods, and then it was discovered that gold held a universal attraction and was a convenient substitute for more cumbersome barter transactions. Not only did gold facilitate exchange of goods and services, it served as a store of value for those who wanted to save for a rainy day. Though money developed naturally in the marketplace as governments grew in power, they assumed monopoly control over money. Sometimes governments succeeded in guaranteeing the quality and purity of gold; but in time, governments learned to outspend their revenues. New or higher taxes always incurred the disapproval of the people, so it was not long before the kings and caesars learned how to inflate their currencies by reducing the amount of gold in each coin, always hoping their subjects would not discover the fraud. But the people always did, and they strenuously objected. This helped pressure leaders to seek more gold by conquering other nations. The people became accustomed to living beyond their means and enjoyed the circuses and bread. Financing extravagances by conquering foreign lands seemed a logical alternative to working harder and producing more. Besides, conquering nations not only brought home gold; they brought home slaves as well. Taxing the people in conquered territories also provided an incentive to build empires. This system of government worked well for a while, but the moral decline of the people led to an unwillingness to produce for themselves. There was a limit to the number of countries that could be sacked for their wealth, and this always brought empires to an end. When gold no longer could be obtained, their military might crumbled. In those days, those who held the gold truly wrote the rules and lived well. That general rule has held fast throughout the ages. When gold was used and the rules protected honest commerce, productive nations thrived. Whenever wealthy nations, those with powerful armies and gold, strived only for empire and easy fortunes to support welfare at home, those nations failed. Today, the principles are the same, but the process is quite different. Gold is no longer a currency of the realm; paper is. The truth now is he who prints the money makes the rules, at least for the time being. Although gold is not used, the goals are the same: compel foreign countries to produce and subsidize the country with military superiority and control over the monetary printing presses. Since printing paper money is nothing short of counterfeiting, the issuer of the international currency must always be the country with the military might to guarantee control over the system. This magnificent scheme seems the perfect system for obtaining perpetual wealth for the country that issues the de facto world currency. The one problem, however, is that such a system destroys the character of the counterfeiting nation's people just as was the case when gold was the currency, and it was obtained by conquering other nations. This destroys the incentive to save and produce while encouraging debt and runaway welfare. The pressure at home to inflate the currency comes from the corporate welfare recipients, as well as those who demand handouts as compensation for their needs and perceived injuries by others. In both cases, personal responsibility for one's actions is rejected. When paper money is rejected, or when gold runs out, wealth and political stability are lost. The country then must go from living beyond its means to living beneath its means until the economic and political systems adjust to the new rules; rules no longer written by those who ran the now defunct printing press. Dollar diplomacy, a policy instituted by William Howard Taft and his Secretary of State, Philander C. Knox, was designed to enhance U.S. commercial investments in Latin America and the Far East. McKinley concocted a war against Spain in 1898 and Teddy Roosevelt's corollary to the Monroe Doctrine preceded Taft's aggressive approach to using the U.S. dollar and diplomat influence to secure U.S. investments abroad. This earned the popular title of ``dollar diplomacy.'' The significance of Roosevelt's change was that our intervention now could be justified by the mere appearance that a country of interest to us was politically or fiscally vulnerable to European control. Not only did we claim a right, but even an official government obligation to protect our commercial interest from Europeans. This new policy came on the heels of the gunboat diplomacy of the late 19th century, and it meant we could buy influence before resorting to the threat of force. By the time dollar diplomacy of William Howard Taft was clearly articulated, the seeds of the American empire were planted, and they were destined to grow in the fertile political soil of a country that lost its love and respect for the Republic bequeathed to us by the authors of the Constitution. Indeed they did. It was not too long before dollar diplomacy became dollar hegemony in the second half of the 20th century. This transition only could have occurred with a dramatic change in monetary policy and the nature of the dollar itself. Congress created the Federal Reserve system in 1913. Between then and 1971, the principle of sound money was systematically undermined. Between 1913 and 1971, the Federal Reserve found it much easier to expand the money supply at will for financing war or manipulating an economy with little resistance from Congress while benefiting the special interests that influence Congress. Dollar dominance got a huge boost after World War II. We were spared the destruction that so many other nations suffered, and our coffers were filled with the world's gold. But the world chose not to return to the discipline of the gold standard, and the politicians applauded. Printing money to pay the bills was a lot more popular than taxing or restraining or unnecessary spending. In spite of the short-term benefits, imbalances were institutionalized for decades to come. The 1944 Bretton Woods agreement solidified the dollar as the preeminent world reserve currency, replacing the British pound. Due to our political and military muscle, and because we had a huge amount of physical gold, the world readily accepted our dollar, defined as 1/35 of an ounce of gold as the world's reserve currency. The dollar was said to be as good as gold and convertible to all foreign banks at that rate. For American citizens, however, it remained illegal to own. This was a gold exchange standard that from inception was doomed to fail. The U.S. did exactly what many predicted she would do: she printed more dollars for which there was no gold backing. But the world was content to accept these dollars for more than 25 years with little question, until the French and others in the late 1960s demanded we fulfill our promise to pay 1 ounce of gold for each $35 they delivered to the U.S. Treasury. This resulted in a huge gold drain that brought an end to a very poorly devised pseudo-gold standard. It all ended on August 15, 1971, when Nixon closed the gold window and refused to pay out any of our remaining 280 million ounces of gold. In essence, we declared our insolvency, and everyone recognized that some other monetary system had to be devised in order to bring stability to the markets. Amazingly, a new system was devised which allowed the U.S. to operate the printing presses for the world reserve currency, with no restraints placed on it, not even a presence of gold convertibility, none whatsoever. Though the new policy was even more deeply flawed, it nevertheless opened the door for dollar hegemony to spread. Realizing the world was embarking on something new and mind-boggling, elite money managers with especially strong support from U.S. authorities struck an agreement with OPEC to price oil in U.S. dollars exclusively for all worldwide transactions. This gave the dollar a special place among world currencies, in essence backed the dollar with oil. In return, the U.S. promised to protect the various oil-rich kingdoms in the Persian Gulf against threat or invasion or domestic coup. This arrangement helped ignite the radical Islamic movement among those who resented our influence in the region. The arrangement gave the dollar artificial strength with tremendous financial benefits for the United States. It allowed us to export our monetary inflation by buying oil and other goods at a great discount as dollar influence flourished. This post-Bretton Woods system was much more fragile than the system that existed between 1945 and 1971. Though the dollar-oil arrangement was helpful, it was not nearly as stable as the pseudo-gold standard under Bretton Woods. It certainly was less stable than the gold standard of the late 19th century. During the 1970s, the dollar nearly collapsed as oil prices surged and gold skyrocketed to $800 an ounce. By 1979, interest rates of 21 percent were required to rescue the system. The pressure on the dollar in the 1970s, in spite of the benefits accrued to it, reflected reckless budget deficits and monetary inflation during the 1960s. The markets were not fooled by LBJ's claim that we could afford both guns and butter. Once again, the dollar was rescued, and this ushered in the age of true dollar hegemony, lasting from the early 1980s to the present. With tremendous cooperation coming from the central banks and international commercial banks, the dollar was accepted as if it were gold. Federal Chairman Alan Greenspan, on several occasions before the House Banking Committee, answered my challenges to him about his previously held favorable views on gold by claiming that he and other central bankers had gotten paper money, that is the dollar system, to respond as if it were gold. Each time I strongly disagreed and pointed out that if they had achieved such a feat they would have defied centuries of economic history regarding the need for money to be something of real value. He smugly and confidently concurred with this. In recent years, central banks and various financial institutions, all with vested interest in maintaining a workable fiat dollar standard, were not secretive about selling and maintaining large amounts of gold to the market, even while decreasing gold prices raised serious questions about the wisdom of such a policy. They never admitted to gold price fixing, but the evidence is abundant that they believed that if the gold price fell, it would convey a sense of confidence to the market, confidence that they, indeed, had achieved amazing success in turning paper into gold. Increasing gold prices historically are viewed as an indicator of distrust in paper currency. This recent effort was not a whole lot different than the U.S. Treasury selling gold at $35 an ounce in the 1960s in an attempt to convince the world the dollar was as sound and as good as gold. Even during the Depression, one of Roosevelt's first acts was to remove free-market pricing as an indication of a flawed monetary system by making it illegal for American citizens to own gold. Economic law eventually limited that effort, as it did in the early 1970s, when our Treasury and the IMF tried to fix the price of gold by dumping tons into the market to dampen the enthusiasm of those seeking a safe haven for a falling dollar after gold ownership was relegalized. Once again, the effort between 1980 and 2000 to fool the market as to the true value of the dollar proved unsuccessful. In the past 5 years, the dollar has been devalued in terms of gold by more than 50 percent. You just cannot fool all the people all the time, even with the power of the mighty printing press and the money-creating system of the Federal Reserve. Even with all the shortcomings of the fiat monetary system, dollar influence thrived. The results seemed beneficial, but gross distortions built into the system remained. And true to form, Washington politicians are only too anxious to solve the problems cropping up with window dressing while failing to understand and deal with the underlying flawed policy. Protectionism, fixing exchange rates, punitive tariffs, politically motivated sanctions, corporate subsidies, international trade management, price controls, interest rate and wage controls, super-nationalist sentiments, threat of force, and even war are resorted to, all to solve the problems artificially created by a deeply flawed monetary and economic system. In the short run, the issuer of a fiat reserve currency can accrue great economic benefits. In the long run, it poses a threat to the country issuing the world currency. In this case, that is the United States. As long as foreign countries take our dollars in return for real goods, we come out ahead. This is a benefit many in Congress fail to recognize as they bash China for maintaining a positive trade balance with us. But this leads to a loss of manufacturing jobs to overseas markets as we become more dependent on others and less self- sufficient. Foreign countries accumulate our dollars due to their high savings rates and graciously lend them back to us at low interest rates to finance our excessive consumption and our wars. It sounds like a great deal for everyone, except the time will come when our dollars, due to their depreciation, will be received less enthusiastically or even be rejected by foreign countries. That could create a whole new ball game and force us to pay a price for living beyond our means and our production. The shift in sentiment regarding the dollar has already started, but the worst is yet to come. The agreement with OPEC in the 1970s to price oil in dollars has provided tremendous artificial strength to the dollar as the preeminent reserve currency. This has created a universal demand for the dollar and soaks up the huge number of new dollars generated each year. Last year alone, M3 increased by over $700 billion. The artificial demand for our dollar, along with our military might, places us in the unique position to ``rule'' the world without productive work or savings and without limits on consumer spending or deficits. The problem is it cannot last. Price inflation is raising its ugly head, and the NASDAQ bubble, generated by easy money, has burst. The housing bubble likewise created is deflating. Gold prices have doubled, and Federal spending is out of sight, with zero political will to rein it in. The trade deficit last year was over $728 billion. A $2 trillion war is raging, and plans are being laid to expand the war into Iran and possibly Syria. The only restraining force will be the world's rejection of the dollar. It is bound to come and create conditions worse than 1979-1980, which required 21 percent interest rates to correct. But everything possible will be done to protect the dollar in the meantime. We have a shared interest with those who hold our dollars to keep the whole charade going. Greenspan, in his first speech after leaving the Fed, said that gold prices were up because of concern about terrorism and not because of monetary concerns or because he created too many dollars during his tenure. Gold has to be discredited and the dollar propped up. Even when the dollar comes under serious attack by market forces, the central banks and the IMF will surely do everything conceivable to soak up the dollars in hope of restoring stability. Eventually, they will fail. Most importantly, the dollar/oil relationship has to be maintained to keep the dollar as the preeminent currency. Any attack on this relationship will be forcefully challenged, as it already has been. In November, 2000, Saddam Hussein demanded euros for his oil. His arrogance was a threat to the dollar; his lack of any military might was never a threat. At the first Cabinet meeting with the new administration in 2001, as reported by Treasury Secretary Paul O'Neill, the major topic was how we could get rid of Saddam Hussein though there was no evidence whatsoever he posed a threat to us. This deep concern for Saddam Hussein surprised and shocked O'Neill. It is now common knowledge that the immediate reaction of the administration after 9/11 revolved around how they could connect Saddam Hussein to the attacks to justify an invasion and overthrow of his government. Even with no evidence of any connection to 9/11 or evidence of weapons of mass destruction, public and congressional support was generated through distortions and flat-out misrepresentations of the facts to justify overthrowing Saddam Hussein. There was no public talk of removing Saddam Hussein because of his attack on the integrity of the dollar as a reserve currency by selling his oil in euros, yet many believe this was the reason for our obsession with Iraq. I doubt it was the only reason, but it may well have played a significant role in our motivation to wage war. Within a very short period after the military victory in Iraq, all Iraqi oil sales were carried out in dollars. The euro was immediately abandoned. In 2001, Venezuela's ambassador to Russia spoke of Venezuela's switching to the euro for all their oil sales. Within a year, there was a coup attempt against Chavez, reportedly with assistance from our CIA. After these attempts to nudge the euro toward replacing the dollar as the world's reserve currency were met with resistance, the sharp fall of the dollar against the euro was reversed. These events may well have played a significant role in maintaining dollar dominance. It has become clear the U.S. administration was sympathetic to those who plotted the overthrow of Chavez and was embarrassed by its failure. The fact that Chavez was democratically elected had little influence on which side we supported. Now a new attempt is being made against the petrodollar system. Iran, another member of the ``Axis of Evil,'' has announced her plans to initiate an oil bourse in March of this year. Guess what? The oil sales will be priced in euros, not dollars. Most Americans forgot how our policies have systematically and needlessly antagonized the Iranians over the years. In 1953, the CIA helped overthrow a democratically elected Mohammed Mossadegh and installed the authoritarian Shah, who was friendly to the U.S. The Iranians were still fuming over this when the hostages were seized in 1979. Our alliance with Saddam Hussein in his invasion of Iran in the early 1980s did not help matters and obviously did not do much for our relationship with Saddam Hussein. The administration's announcement in 2001 that Iran was part of the Axis of Evil did not improve the diplomatic relationship between our two countries. Recent threats over nuclear power, while ignoring the fact that they are surrounded by countries with nuclear weapons, does not seem to register with those who continue to provoke Iran. With what most Muslims perceive as our war against Islam and this recent history, there is little wonder why Iran might choose to harm America by undermining the dollar. Iran, like Iraq, has zero capability to attack us, but that did not stop us from turning Saddam Hussein into a modern-day Hitler ready to take over the world. Now Iran, especially since she has made plans for pricing oil in euros, has been on the receiving end of a propaganda war not unlike that waged against Iraq before our invasion. It is not likely that maintaining dollar supremacy was the only motivating factor for the war against Iraq nor for agitating against Iran. Though the real reasons for going to war are complex, we now know the reasons given before the war started, like the presence of weapons of mass destruction and Saddam's connection to 9/11, were false. The dollar's importance is obvious, but this does not diminish the influence of the distinct plans laid out years ago by the neoconservatives to remake the Middle East. Israel's influence as well as that of the Christian Zionists likewise played a role in prosecuting this war. Protecting our oil supplies has influenced our Middle East policy for decades. But the truth is that paying the bills for this aggressive intervention is impossible the old-fashioned way, with more taxes, more savings, and more production by the American people. Much of the expense of the Persian Gulf War in 1991 was shouldered by many of our willing allies. That is not so today. Now more than ever, the dollar hegemony, its dominance as the world's reserve currency, is required to finance our huge war expenditures. This $2 trillion never-ending war must be paid for one way or another. Dollar hegemony provides the vehicle to do just that. For the most part, the true victims are not aware of how they pay the bills. The license to create money out of thin air allows the bills to be paid through price inflation. American citizens as well as average citizens of Japan and China and other countries suffer from price inflation, which represents the tax that pays the bills for our military adventures. That is, until the fraud is discovered and the foreign producers decide not to take dollars nor hold them very long in payment for those goods. Everything possible is done to prevent the fraud of the monetary system from being exposed to the masses who suffer from it. If oil markets replace dollars with euros, it would in time curtail our ability to continue to print, without restraint, the world's reserve currency. It is an unbelievable benefit to us to import valuable goods and export depreciating dollars. The exporting countries have become addicted to our purchases for their economic growth. This dependency makes them allies in continuing the fraud, and their participation keeps the dollar's value artificially high. If this system were workable long term, American citizens would never have to work again. We, too, could enjoy ``bread and circuses'' just as the Romans did, but their gold finally ran out and the inability of Rome to continue to plunder conquered nations brought an end to her empire. The same thing will happen to us if we do not change our ways. Though we do not occupy foreign countries to directly plunder, we nevertheless have spread our troops across 130 nations of the world. Our intense effort to spread our power in the oil-rich Middle East is not a coincidence. But, unlike the old days, we do not declare direct ownership of the natural resources. We just insist that we can buy what we want and pay for it with our paper money. Any country that challenges our authority does so at great risk. Once again, Congress has bought into the war propaganda against Iran just as it did against Iraq. Arguments are now made for attacking Iran economically and militarily if necessary. These arguments are based on the same false reasons given for the ill-fated and costly occupation of Iraq. Our whole economic system depends on continuing the current monetary arrangement, which means recycling the dollar is crucial. Currently, we borrow over $700 billion every year from our gracious benefactors, who work hard and take our paper for their goods. Then we borrow all the money we need to secure the empire, which includes the entire DOD budget of $450 billion, plus more. The military might we enjoy becomes the backing of our currency. There are no other countries that can challenge our military superiority, and therefore they have little choice but to accept the dollars we declare are today's ``gold.'' This is why countries that challenge the system, like Iraq, Iran, and Venezuela, become targets of our plans for regime change. Ironically, dollar superiority depends on our strong military, and our strong military depends on the dollar. As long as foreign recipients take our dollars for real goods and are willing to finance our extravagant consumption and militarism, the status quo will continue, regardless of how huge our foreign debt and current account deficit become. But real threats come from our political adversaries who are capable of confronting us militarily yet are not bashful about confronting us economically. That is why we see the new challenge from Iran being taken so seriously. The urgent arguments about Iran's posing a military threat to the security of the United States are no more plausible than the false charges levied against Iraq. Yet there is no effort to resist this march to confrontation by those who grandstand for political reasons against the Iraq War. It seems that the people and Congress are easily persuaded by the jingoism of the preemptive war promoters. It is only after the cost of human life and dollars are tallied up that the people object to unwise militarism. The strange thing is that the failure in Iraq is now apparent to a large number of Americans, yet they and Congress are acquiescing to the call for a needless and dangerous confrontation with Iran. But then again our failure to find Osama bin Laden and destroy his network did not dissuade us from taking on Iraqis in a war totally unrelated to 9/11. Concern for pricing oil only in dollars helps explain our willingness to drop everything and teach Saddam Hussein a lesson for his defiance in demanding euros for oil. Once again, there is the urgent call for sanctions and threats of force against Iran at the precise time Iran is opening a new oil exchange with all transactions in Euros. Using force to compel people to accept money without real value can only work for a short time. It ultimately leads to economic dislocation, both domestic and international, and always ends with a price to be paid. The economic law that honest exchange demands only things of real value as currency cannot be repealed. The chaos that one day will ensue from our 35-year experiment with worldwide fiat money will require a return to money of real value. We will know that day is approaching when oil-producing countries demand gold or its equivalent for their oil rather than dollars or Euros. The sooner the better. Need For Reform In Light of Lobbying Scandal Mr. Speaker, I would like to now switch topics and address another subject, and this is regarding the need for reform in light of the recent lobbying scandal. Mr. Speaker, the Abramoff scandal has been described as the biggest Washington scandal ever, bigger than Watergate, bigger than ABSCAM, bigger than Koreagate, bigger than the House banking scandal, bigger than Teapot Dome. Possibly so. It is certainly serious and significant. It has prompted urgent proposals of suggested reforms to deal with the mess. If only we had more rules and regulations, more reporting requirements and stricter enforcement of laws, the American people will be assured we mean business. Ethics and character will return to the Halls of Congress. It is argued that new champions of reform should be elected to leadership positions to show how serious we are about dealing with the crisis of confidence generated by the Abramoff affair. Then all will be well. But it is not so simple. Maybe what we have seen so far is just the tip of the iceberg and the insidious crisis staring us in the face that we refuse to properly identify and deal with. It has been suggested we need to change course and correct the way Congress is run. A good idea, but if we merely tinker with current attitudes about what role the Federal Government ought to play in our lives, it won't do much to solve the ethics crisis. True reform is impossible without addressing the immorality of wealth redistribution. Merely electing new leaders and writing more rules to regulate those who petition Congress will achieve nothing. Could it be that we are all looking in the wrong places for our solution to a recurring, constant, and pervasive corruption in government? Perhaps some of us in Congress are mistaken about the true problem. Perhaps others deliberately distract us from exposing the truth about how miserably corrupt the budget process in Congress is. Others simply are in a State of denial. But the denial will come to an end as the Abramoff scandal reveals more and more. It eventually will expose the scandal of the ages, how and to what degree the American people have become indebted by the totally irresponsible spending habits of the U.S. Congress as encouraged by successive administrations, condoned by our courts, and enjoyed by the recipients of the largesse. This system of government is coming to an end, a fact that significantly contributes to the growing anxiety of most Americans, especially those who pay the bills and receive little in return from the corrupt system that has evolved over the decades. Believe me, if everybody benefited equally, there would be scant outcry over a little bribery and influence peddling. As our country grows poorer and more indebted, fewer people benefit. The beneficiaries are not the hard-working, honest people who pay the taxes. The groups that master the system of lobbying and special interest legislation are the ones who truly benefit. The steady erosion of real wealth in this country and the dependency on government generated by welfare-ism and warfare-ism presents itself as the crisis of the ages. Lobbying scandals and the need for new leadership are mere symptoms of a much, much deeper problem. There are quite a few reasons a relatively free country allows itself to fall into such an ethical and financial mess. One major contributing factor for the past 100 years is our serious misunderstanding of the dangers of pure democracy. The Founders detested democracy and avoided the use of the word in all the early documents. Today, most Americans accept without question a policy of sacrificing life, property and dollars to force democracy on a country 6,000 miles away. This tells us how little opposition there is to democracy. No one questions the principle that a majority electorate should be allowed to rule the country, dictate rights, and redistribute wealth. Our system of democracy has come to mean worshiping the notion that a majority vote for the distribution of government largesse, loot confiscated from the American people through an immoral tax system, is morally and constitutionally acceptable. Under these circumstances, it is no wonder a system of runaway lobbying and special interests has developed. Add this to the military industrial complex that developed over the decades due to a foreign policy of perpetual war and foreign military intervention, and we shouldn't wonder why there is such a powerful motivation to learn the tricks of the lobbying trade and why former Members of Congress and their aides become such high-priced commodities. Buying influence is much more lucrative than working and producing for a living. The trouble is in the process; the process invites moral corruption. The dollars involved grow larger and larger because of the deficit financing and inflation that pure democracy always generates. Dealing with lobbying scandals while ignoring the scandal of unconstitutional runaway government will solve nothing. If people truly believe that reform is the solution through regulating lobbyists and increasing congressional reporting requirements, the real problem will be ignored and never identified. This reform only makes things worse. Greater regulation of lobbyists is a dangerous and unnecessary proposition. If one expects to solve a problem without correctly identifying its source, the problem persists. The first amendment clearly states ``Congress shall make no laws respecting the right of the people to petition the government for a redress of grievances.'' That means no law. The problem of special interest government that breeds corruption comes from our lack of respect for the Constitution in the first place. So what do we do? We further violate the Constitution, rather than examine it for guidance as to the proper role of the Federal Government. Laws addressing bribery, theft, and fraud already on the books are adequate to deal with the criminal activities associated with lobbying. New laws and regulations are unnecessary. The theft that the Federal Government commits against its citizens and the power that Congress has assumed illegally are the real crimes that need to be dealt with. In this regard, we truly need a new direction: get rid of the evil tax system, the fraudulent monetary system and the power of the government to run our lives, the economy and the world, and the Abramoff types would be exposed for the mere gnats they are. There would be a lot less of them since the incentive to buy politicians would be removed. Even under today's flawed system of democratic government, which is dedicated to redistributing property by force, a lot could be accomplished if government attracted men and women of good will and character. Members could just refuse to yield to the temptations of office and reject the path to a lobbying career. But it seems once government adopts the rules of immorality, some of the participants in the process yield to the temptation as well, succumbing to the belief that the new moral standards are acceptable. Today, though, any new rules designed to restrain special interest favoritism will only push the money further under the table. Too much is at stake. Corporations, bureaucrats, lobbyists and politicians have grown accustomed to the system and have learned to work within it to survive. Only when the trough is empty will the country wake up. Eliminating earmarks in the budget will not solve the problem. Comparing the current scandal to the big one, the Abramoff types are petty thieves. The government deals in trillions of dollars, the Abramoffs in mere millions. Take a look at the undeclared war we are bogged down in 6,000 miles from our shore. We have spent $300 billion already, but Nobel Prize winner Joseph Stiglitz argues that the war will actually cost between $1 trillion and $2 trillion when it is all over. That is trillions, not billions. Even that figure is unpredictable, because we may be in Iraq for another year or 10. Who knows. Considering the war had nothing to do with our national security, we are talking big bucks being wasted in lining the pockets of well- connected American corporations. Waste, fraud, stupidity, and no-bid contracts characterize the process; and it is all done in the name of patriotism and national security. Dissenters are accused of supporting the enemy. Now, this is a ripoff that a little tinkering with House rules and restraints on lobbyists won't do much to solve. Think of how this undeclared war has contributed to our national deficit, undermined military preparedness, antagonized our allies, and exposed us to an even greater threat from those who resent our destructive occupation. Claiming we have no interest in the oil of the entire Middle East hardly helps our credibility throughout the world. The system of special interest government that has evolved over the last several decades has given us a national debt of over $8 trillion, a debt that now expands by over $600 billion every year. Our total obligations are estimated to be between $15 trillion and $20 trillion. Most people realize that the Social Security system, the Medicare system and the new prescription drug program are unfunded. Thousands of private pension funds are now being dumped on the U.S. Government and American taxpayers. We are borrowing over $700 billion each year from foreigners to finance this extravagance, and we now qualify as the greatest international debtor Nation in history. Excessive consumption using borrowed money is hardly the way to secure a sound economy. Instead of reining in government spending, Congress remains oblivious to the financial dangers and panders to special interests by offering no resistance whatsoever to every request for new spending. Congress spends $2.7 trillion annually in an attempt to satisfy everyone's demands. The system has generated over $200 trillion in derivatives. These problems can't be addressed with token leadership changes and tinkering with the budget. A new and dramatic direction is required. As current policy further erodes the budget, special interests and Members of Congress become even more aggressive in their efforts to capture a piece of the dwindling economic pie. That success is the measure of effectiveness that guarantees a Member's reelection. The biggest ripoff of all, the paper money system that is morally and economically equivalent to counterfeiting, is never questioned. It is the deceptive tool for transferring billions from the unsuspecting poor and middle class to the special-interest rich, and in the process the deficit-propelled budget process supports the spending demands of all the special interests, left and right, welfare and warfare, while delaying payment to another day and sometimes even to another generation. The enormous sums spent each year to support the influential special interests expand exponentially and no one really asks how it is accomplished. Raising taxes to balance the budget is out of the question, and rightfully so. Foreigners have been generous in their willingness to loan us most of what we need, but even that generosity is limited and may well diminish in the future. But if the Federal Reserve did not pick up the slack and create huge amounts of new credit and money out of thin air, interest rates would rise and call a halt to the charade. The people who suffer from a depreciated dollar don't understand why they suffer, while the people who benefit promote the corrupt system. The wealthy clean up on Wall Street and the unsophisticated buy in at the market tops. Wealth is transferred from one group to another, and it is all related to the system that allows politicians and the central banks to create money out of thin air. It is literally legalized counterfeiting. Is it any wonder jobs go overseas? True capital only comes from savings, and Americans save nothing. We only borrow and consume. A counterfeiter has no incentive to take his newly created money and build factories. The incentive for Americans is to buy consumers goods from other countries whose people are willing to save and invest in their factories and jobs. The only way we can continue this charade is to borrow excess dollars back from the foreign governments who sell us goods and perpetuate the pretense of wealth that we enjoy. The system of money contributes significantly to the problems of illegal immigration. On the surface, immigrants escaping poverty in Mexico and Central America come here for the economic opportunity that our economy offers. However, the social services they receive, including education and medical benefits, as well as the jobs they get, are dependent on our perpetual indebtedness to foreign countries. When the burden of debt becomes excessive, this incentive to seek prosperity here in the United States will change. The prime beneficiaries of a paper money system are those who use the money early, governments, politicians, bankers, international corporations and the military industrial complex. Those who suffer most are the ones at the end of the money chain, the people forced to use depreciated dollars to buy urgently needed goods and services to survive. And guess what? By then, their money is worth less, prices soar, and their standard of living goes down. The consequences of this system, fully in place for the past 34 years, are astronomical and impossible to accurately measure. Industries go offshore, and the jobs follow. Price inflation eats away at the middle class and deficits soar, while spending escalates rapidly as Congress hopes to keep up with the problems it created. The remaining wealth that we struggle to hold on to is based on debt, future tax revenues, and our ability to manufacture new tax dollars without restraint. There is only one problem. It all depends on trust in the dollar, especially by foreign holders and purchasers. This trust will end, and signs of the beginning of the end are already appearing. During this administration, the dollar has suffered severely as a consequence of the policy of inflating the currency to pay our bills. The dollar price of gold has more than doubled. This means the dollar has depreciated in terms of gold, the time-honored and reliable measurement of a nation's currency, by an astounding 55 percent. The long-term economic health of a nation is measured by the soundness of its currency. Once Rome converted from a republic to an empire, she depreciated her currency to pay the bills. This eventually led to Rome's downfall. That is exactly what America is facing unless we change our ways. Now, this is a real scandal worth worrying about. Since it is not yet on Washington's radar screen, no attempt at addressing the problem is being made. Instead, we will be sure to make those the Constitution terms petitioners to redress their grievances fill out more forms. We will make government officials attend more ethics courses so they can learn how to be more ethical. A free nation as it moves towards authoritarianism tolerates and hides a lot of the abuse in the system. The human impulse for wealth creation is hard to destroy, but in the end it will happen here if true reform of our economic, monetary, and political system is not accomplished. Whether government programs are promoted for good causes, helping the poor, or bad causes, permitting a military industrial complex to capitalize on war profits, the principles of the market are undermined. Eventually, nearly everyone becomes dependent on the system of deficits, borrowing, printing press money, and the special interest budget process that distributes the loot by majority vote. Today, most business interests and the poor are dependent on government handouts. Education and medical care is almost completely controlled and regulated by an overpowering central government. We have come to accept our role as world policeman and nation builder with little question despite the bad results and inability to pay the bills. The question is, what will it take to bring about the changes in policy needed to reverse this dangerous trend? The answer is, quite a lot; and, unfortunately, it is not on the horizon. It probably will not come until there is a rejection of the dollar as the safest and strongest world currency and a return to commodity money like gold and silver to return confidence. The Abramoff-type scandals come and go in Washington, patched over with grandiose schemes and reform that amount to nothing more than government and congressional mischief. But our efforts should be directed toward eliminating the greatest of all frauds, printing press money that creates the political conditions breeding the vultures and leaches who feed off the corrupt system. Counterfeiting money never creates wealth. It only steals wealth from the unsuspecting. The Federal Reserve creation of money is exactly the same. Increasing the dollars in circulation can only diminish the value of each existing dollar. Only production and jobs can make a country wealthy in the long run. Today, it is obvious our country is becoming poorer and more uneasy as our jobs and capital go overseas. The Abramoff scandal can serve a useful purpose if we put it in the context of the entire system that encourages corruption. If it is seen as an isolated case of individual corruption and not an expected consequence of big government run amok, little good will come of it. If we understand how our system of government intervenes in our personal lives, the entire economy and the internal affairs of other nations around the world, we can understand how it generates the conditions where lobbyists thrive. Only then will some good come of it. Only then will we understand that undermining the first amendment right of people to petition the government is hardly a solution to this much more serious and pervasive problem. If we are inclined to improve conditions we should give serious consideration to the following policy reforms, reforms the American people who cherish liberty would enthusiastically support. Let us have no more No Child Left Behind legislation. Let us have no more prescription drugs programs. No more undeclared wars. No more nation building. No more acting as the world policeman. No more deficits. No more excessive spending everywhere. No more political and partisan resolutions designed to embarrass those who may well have legitimate and honest disagreements with current policy. No inferences that disagreeing with policy is unpatriotic or disloyal to the country. No more pretense of budget reforms while ignoring off-budget spending in the ever-growing 14 appropriations bills. Cut funding for corporate welfare, foreign aid, international NGOs, defense contractors, the military industrial complex, and rich corporate farmers before cutting welfare for the poor at home. No more unconstitutional intrusions into the privacy of law-abiding American citizens. Reconsider the hysterical demands for security over liberty by curtailing the ever-expanding oppressive wars on drugs, tax violators and gun ownership. Finally, why not try something novel like having Congress act as an independent and equal branch of government? Restore the principle of the separation of powers so that we can perform our duty to provide checks and balances on an executive branch and an accommodating judiciary that spies on Americans, glorifies the welfare state, fights undeclared wars, and enormously increases the national debt. Congress was not meant to be a rubber stamp. It is time for a new direction.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I intend to vote in favor of this legislation because I support any statement by Congress indicating hesitation to send U.S. taxpayer money abroad. Unfortunately this legislation is motivated by politics rather than a genuine desire to limit unconstitutional foreign aid programs. The wording of the resolution itself does not close the door to providing U.S. aid to the Palestinians even if Hamas, the political party that won recent parliamentary elections, takes its seats in parliament without altering its stated policies toward Israel. Indeed, the legislation states that ``no United States assistance should be provided directly to the Palestinian Authority'' if Hamas occupies a majority of seats in the Palestinian parliament. This obviously suggests that the money can be spent ``indirectly'' in any case. So this is hardly a strong statement opposing any and all aid to the Palestinians, which is the position that I hold. I find it interesting that the same proponents of the United States government exporting democracy overseas are now demanding that something be done when people overseas do not vote the way the U.S. Government thinks they should. It seems that being for democracy means respecting that people overseas may not always vote the way Washington wants them to vote. If our aim is to ensure that only certain parties or individuals are allowed to lead foreign nations, why not just admit that democracy is the last thing we want? That attitude is evident in the fact that the U.S. Government spent more than $2 million trying to manipulate the Palestinian vote in favor of parties supported by Washington. You cannot have it both ways. Although it is always a good idea to eliminate foreign aid, we should be careful about calling the manipulation of elections overseas an exercise in ``democracy promotion.''

Mr. PAUL

Mr. PAUL. Mr. Speaker, anyone who doubts that symbols often take priority over substance in Washington only needs to consider that among our first items of business the House of Representatives is considering this year is a measure banning from the House gym former members of Congress who are now lobbyists. This bill is being rushed to the floor in order to assure the American people that Congress is ``cracking down'' on lobbying practices in response to recent scandals. This measure does nothing to address the root cause of the scandals-- the ever-growing size and power of the Federal Government. As long the Federal Government continues to regulate, tax, and subsidize the American people, there will be attempts to influence those who write the laws and regulations under which the people must live. Human nature being what it is, there will also be those lobbyists and policymakers who will manipulate the power of the regulatory state to enrich themselves. As I have said before, and I fear I will have plenty of opportunity to say again, the only way to get special interest money and influence out of politics is to get the money and power out of Washington. Instead of passing new regulations and laws regulating the people's right to petition their government, my colleagues should refuse to vote for any legislation that violates the constitutional limits on Federal power or enriches a special interest at the expense of American taxpayers. Returning to constitutional government is the only way to ensure that our republican institutions will not be corrupted by powerful interests seeking special privileges.

Mr. PAUL

Mr. PAUL. Mr. Speaker, our country faces major problems. No longer can they remain hidden from the American people. Most Americans are aware the Federal budget is in dismal shape. Whether it is Social Security, Medicare, Medicaid, or even the private pension system, most Americans realize we are in debt over our heads. The welfare state is unmanageable and severely overextended. In spite of hopes that supposed reform would restore sound financing and provide for all the needs of the people, it is becoming more apparent every day that the entire system of entitlements is in a precarious state and may well collapse. It does not take a genius to realize that increasing the national debt by over $600 billion per year is not sustainable. Raising taxes to make up the shortfall is unacceptable, while continuing to print the money needed will only accelerate the erosion of the dollar's value. Our foreign policy is no less of a threat to us. Our worldwide military presence and our obsession with remaking the entire Middle East frighten a lot of people both here and abroad. Our role as world policeman and nation-builder places undue burdens on the American taxpayer. Our enormous overseas military expenditures, literally hundreds of billions of dollars, are a huge drain on the American economy. All wars invite abuses of civil liberties at home, and this vague declaration of war against terrorism is worse than most in this regard. As our liberties here at home are diminished by the PATRIOT Act and national ID card legislation, we succumb to the temptation of all empires to spy on American citizens, neglect habeas corpus, employ torture tactics, and use secret imprisonments. These domestic and foreign policy trends reflect a morally bankrupt philosophy devoid of any concern for liberty and the rule of law. The American people are becoming more aware of the serious crisis this country faces. Their deep concern is reflected in the current mood in Congress. The recent debate over Iraq shows the parties are now looking for someone to blame for the mess we are in. It is a high- stakes political game. The fact that a majority of both parties and their leadership endorsed the war and accept the same approach towards Syria and Iran does nothing to tone down the accusatory nature of the current blame game. The argument in Washington is over tactics, quality of intelligence, war management, and diplomacy, except for the few who admit that tragic mistakes were made and now sincerely want to establish a new course for Iraq. Thank goodness for those who are willing to reassess and admit to those mistakes. Those of us who have opposed the war all along welcome them to the cause of peace. If we hope to pursue a more sensible foreign policy, it is imperative that Congress face up to its explicit constitutional responsibility to declare war. It is easy to condemn the management of a war, one endorsed, while deferring to the final decision about whether to deploy the troops to the President. When Congress accepts and assumes its awesome responsibility to declare or not declare war as directed by the Constitution, fewer wars will be fought. Sadly, the acrimonious blame game is motivated by the leadership of both parties for the purpose of gaining or retaining political power. It does not approach a true debate over the wisdom or lack thereof of foreign military interventionism and preemptive war. Polls indicate ordinary Americans are becoming uneasy with our prolonged war in Iraq which has no end in sight. The fact that no one can define victory precisely, and most Americans see us staying in Iraq for years to come, contributes to the erosion of support for this war. Currently, 63 percent of Americans disapprove of the handling of the war, and 52 percent say it is time to come home. Forty-two percent say we need a foreign policy of minding our own business. This is very encouraging. The percentages are even higher for the Iraqis. Eighty-two percent want us to leave, and 67 percent claim they are less secure with our troops there. Ironically, our involvement has produced an unusual agreement among the Kurds, Shiites, and Sunnis, the three factions at odds with each other. At the recent 22-member Arab League meeting in Cairo, the three groups agreed on one issue. They all want foreign troops to leave. At the end of the meeting, an explicit communique was released: ``We demand the withdrawal of foreign forces in accordance with a timetable and the establishment of a national and immediate program for rebuilding the armed forces that will allow them to guard Iraq's borders and get control of the security situation.'' Since the administration is so enamored of democracy, why not have a national referendum in Iraq to see if the people want us to leave? After we left Lebanon in the 1980s, the Arab League was instrumental in brokering an end to that country's 15-year civil war. Its chances of helping to stop the fighting in Iraq are far better than depending on the United Nations, NATO, or the United States. This is a regional dispute that we stirred up, but cannot settle. The Arab League needs to assume a lot more responsibility for the mess that our invasion has caused. We need to get out of the way and let them solve their own problems. Remember, once we left Lebanon, suicide terrorism stopped and peace finally came. The same could happen in Iraq. Everyone is talking about the downside of us leaving and the civil war that might erupt. Possibly so. But no one knows with certainty what will happen. There was no downside when we left Vietnam. But one thing for sure, after a painful decade of the 1960s, the killing stopped and no more Americans died once we left. We now trade with Vietnam and enjoy friendly relations with them. This was achieved through peaceful means, not military force. The real question is how many more Americans must be sacrificed for a policy that is not working. Are we going to fight until we go broke and the American people are impoverished? Common sense tells us it is time to reassess the politics of military intervention and not just look for someone to blame for falling once again into the trap of a military quagmire. The blame game is a political event designed to avoid the serious philosophic debate over our foreign policy of interventionism. The mistakes made by both parties in dragging us into an unwise war are obvious, but the effort to blame one group over the other confuses the real issue. Obviously, Congress failed to meet its constitutional obligation regarding war. Debate over prewar intelligence elicits charges of errors, lies, and complicity. It is argued that those who are now critical of the outcome are just as much at fault since they too accepted flawed intelligence when in deciding to support the war. This charge is leveled at previous administrations, foreign governments, Members of Congress, and the United Nations, all who made the same mistake of blindly accepting the pre-war intelligence. But complicity, errors of judgment, and malice are hardly an excuse for such a serious commitment as a preemptive war against a nonexistent enemy. Both sides accepted the evidence supposedly justifying the war, evidence that was not credible. No weapons of mass destruction were found. Iraq had no military capabilities. Al Qaeda and Saddam Hussein were not allies. Remember, we were once allies of both Saddam Hussein and Osama bin Laden. And Saddam Hussein posed no threat whatsoever to the United States or his neighbors. We hear constantly that we must continue the fight in Iraq and possibly in Iran and Syria because it is better to fight the terrorists over there than here. Merely repeating this justification, if it is based on a major analytical error, cannot make it so. All evidence shows that our presence in Iraq, Saudi Arabia, and other Muslim countries benefits al Qaeda in its recruiting efforts, especially in its search for suicide terrorists. This one fact prompts a rare agreement among all religious and secular Muslim factions, namely, that the U.S. should leave all Arab lands. Denying this will not keep terrorists from attacking us. It will do the opposite. The fighting and terrorist attacks are happening overseas because of a publicly stated al Qaeda policy that they will go for soft targets: our allies, whose citizens object to the war, like Spain and Italy. They will attack Americans who are more exposed in Iraq. It is a serious error to conclude that fighting them over there keeps them from fighting us over here or that we are winning the war against terrorism. As long as our occupation continues and American forces continue killing Muslims, the incentive to attack us will grow. It should not be hard to understand that the responsibility for violence in Iraq, even violence between Iraqis, is blamed on our occupation. It is more accurate to say the longer we fight them over there, the longer we will be threatened over here. The final rhetorical refuge for those who defend the war not yet refuted is the dismissive statement that the world is better off without Saddam Hussein. It implies no one can question anything we have done because of this fact. Instead of an automatic concession, it should be legitimate, even if politically incorrect, to challenge this disarming assumption. No one has to like or defend Saddam Hussein to point out, we will not know whether the world is better off until we know exactly what will take Saddam Hussein's place. This argument was never used to justify removing murderous dictators with much more notoriety than Saddam Hussein such as our ally Stalin, Pol Pot whom we helped to get into power, or Mao Tse Tung. Certainly the Soviets, with their bloody history and thousands of nuclear weapons aimed at us, were many times over greater a threat to us than Saddam Hussein ever was. If containment worked with the Soviets and the Chinese, why is it assumed without question that deposing Saddam Hussein is obviously and without question a better approach for us than containment? The ``we are all better off without Saddam Hussein'' cliche does not address the question of whether the 2,100-plus American troops killed or the 20,000 wounded and sick troops are better off. We refuse to acknowledge the hatred generated by the deaths of tens of thousands of Iraqi citizens who are written off as collateral damage. Are the Middle East and Israel better off with the turmoil our occupation has generated? Hardly. Honesty would have us conclude that conditions in the Middle East are worse since the war started. The killing never stops, and the cost is more than we can bear both in lives and limbs lost and dollars spent. In spite of the potential problems that may or may not come from our withdrawal, the greater mistake was going in in the first place. We need to think more about how to avoid these military encounters rather than dwelling on the complications that result when we meddle in the affairs of others with no moral or legal authority to do so. We need less blame game and more reflection about the root cause of our aggressive foreign policy. By limiting the debate to technical points over intelligence, strategy, the number of troops and how to get out of the mess, we ignore our continued policy of sanctions, threats and intimidation of Iraqi neighbors, Iran and Syria. Even as Congress pretends to argue about how or when we might come home, leaders from both parties continue to support the policy of spreading the war by precipitating a crisis with these two countries. The likelihood of agreeing about who deliberately or innocently misled Congress, the media and the American people is virtually nil. Maybe historians at a later date will sort out the whole mess. The debate over tactics and diplomacy will go on, but that only serves to distract from the important issue of policy. Few today in Congress are interested in changing from our current accepted policy of intervention to one of strategic independence. No nation building, no policing the world, no dangerous alliances. But the result of this latest military incursion into a foreign country should not be ignored. Those who dwell on pragmatic matters should pay close attention to the result so far. Since March 2003, we have seen death and destruction, 2,100-plus Americans killed and nearly 20,000 sick and wounded, plus tens of thousands of Iraqis caught in the crossfire. A Shiite theocracy has been planted. A civil war has erupted. Iran's arch nemesis, Saddam Hussein, has been removed. Osama bin Laden's arch nemesis, Saddam Hussein, has been removed. Al Qaeda now operates freely in Iraq, enjoying a fertile training field not previously available to them. Suicide terrorism spurred on by our occupation has significantly increased. Our military-industrial complex thrives in Iraq without competitive bids. True national defense and the voluntary Army have been undermined. Personal liberty at home is under attack; assaults on free speech and privacy, national ID cards, the PATRIOT Act, National Security Letters, and challenges to habeas corpus all have been promoted. Values have changed, with more Americans supporting torture and secret prisons. Domestic strife, as recently reflected in arguments over the war on the House floor, is on the upswing. Preemptive war has been codified and accepted as legitimate and necessary, a bleak policy for our future. The Middle East is far more unstable, and oil supplies are less secure, not more. Historic relics of civilization protected for thousands of years were lost in the flash while oil wells were secured. U.S. credibility in the world has been severely damaged, and the national debt has increased enormously, and our dependence on China has increased significantly as our Federal Government borrows more and more money. How many more years will it take for civilized people to realize that war has no economic or political value for the people who fight and pay for it? Wars are always started by governments, and individual soldiers on each side are conditioned to take up arms and travel great distances to shoot and kill individuals that never meant them harm. Both sides drive their people into a hysterical frenzy to overcome the natural instinct to live and let live. False patriotism is used to embarrass the good-hearted into succumbing to the wishes of the financial and other special interests who agitate for war. War reflects the weakness of a civilization that refuses to offer peace as an alternative. This does not mean we should isolate ourselves from the world. On the contrary, we need more rather than less interaction with our world neighbors. We should encourage travel, foreign commerce, friendship and exchange of ideas. This would far surpass our misplaced effort to make the world like us through armed force. This can be achieved without increasing the power of the state or accepting the notion that some world government is needed to enforce the rules of exchange. Governments should get out of the way and let the individuals make their own decisions about how they want to relate to the world. Defending our country against aggression is a very limited and proper function of government. Our military involvement in the world over the past 60 years has not met this test, and we are paying the price. A policy that endorses peace over war, trade over sanctions, courtesy over arrogance and liberty over coercion is in the tradition of the American Constitution and American idealism. It deserves consideration.

Mr. PAUL

Mr. PAUL. Mr. Chairman, I rise with serious concerns over this legislation, which although it does address some illegal immigration problems is woefully weak on real substance. I fear that should this bill become law as is, six months or even a year down the road we will see no substantial improvement on the critical issue of deporting illegal aliens and protecting our borders. Some measures in the bill sound good, but are in effect superfluous. Do we need new legislation requiring the Department of Homeland Security to achieve ``operational control of the borders''? Shouldn't the federal government already have ``operational control of the borders''? Here is a road map for real immigration reform. First we need better enforcement of the laws we've got--which plainly call for illegal immigrants to be arrested and deported and for our borders to be secure. These things are already law, but the executive branch over the past decades has failed to enforce them. Congress can pass any law it wants, but unless federal agencies enforce those laws they are meaningless. Second we need to eliminate the two main magnets attracting illegal immigrants to illegally enter the country, the welfare magnet and the citizenship magnet. Failure to address these in an immigration bill raises questions about achieving real results. That is why I introduced three amendments to this bill, in the hopes that we can finally do something about the problem of illegal immigration. I introduced an amendment to end so-called ``birth-right citizenship,'' whereby anyone born on U.S. soil is automatically an American citizen. I introduced an amendment to end the practice of providing U.S. Social Security payments to non-U.S. citizens. And finally I introduced an amendment to prohibit illegal aliens from receiving food stamps, student loans, or other federally-provided assistance. Unfortunately, none of my amendments were even allowed to reach the Floor for a vote. There are some elements of this new bill to be applauded. Measures to require detention of and expedited removal of aliens, for example, are a good step. Also to be applauded is the requirement for an additional 250 inspectors at U.S. ports of entry each year from 2007 through 2010, although this is unfortunately subject to the availability of funds. But overall this bill is a weak substitute for real immigration and border reform. As the Federation for American Immigration Reform (FAIR) says, H.R. 4437 ``treats some of the symptoms, it does not, in fact, do enough to actually cure the illness.''

Mr. PAUL

Mr. PAUL. Mr. Speaker, while H.R. 2830, the Pension Protection Act of 2005, is not perfect, it does decrease the risk that employees will be deprived of pension benefits they were promised as part of their employment contracts. H.R. 2830 also decreases the likelihood that American taxpayers will be forced to bailout private pensions, and reduces the tax burden on American workers to provide them with greater incentives and opportunities to save for their own retirements. Therefore, I will vote for this bill on final passage. However, I oppose this rule, because I do not like the process under which this bill is being brought to the floor. The rule before us today does not allow any member to offer, or vote on, amendments that may improve this bill. In particular, I was hoping to vote on an amendment protecting United Airline retirees from having their pension benefits reduced or terminated even though United expects to make $1 billion in profit within 1 year of being discharged from bankruptcy. The Senate version of the bill does address same problems of the airline industry. However it fails to protect United Airlines retirees. The Federal Government should not facilitate a large companies getting out of its contractual obligations to their retired workers. I, therefore, urge my colleagues to protect the pensions of retired United Airline employees by rejecting this rule and voting for a rule that allows us to consider adding, language helping the United Airline retirees to the bill. If this rule does pass, I urge my colleagues to move the process foreword by voting for the bill and working to add language protecting the United Airline pilots to the bill when it goes to conference with the Senate.

Mr. PAUL

Mr. PAUL. Mr. Speaker, 4 years ago, when the Congress considered the bill creating the terrorism insurance program, I urged my colleagues to reject it. One of the reasons I opposed the bill was my concern that, contrary to the claims of the bill's supporters, terrorism insurance would not be allowed to sunset after 3 years. As I said then: The drafters of H.R. 3210 claim that this creates a ``temporary'' government program. However, Mr. Speaker, what happens in 3 years if industry lobbyists come to Capitol Hill to explain that there is still a need for this program because of the continuing threat of terrorist attacks. Does anyone seriously believe that Congress will refuse to reauthorize this ``temporary'' insurance program or provide some other form of taxpayer help to the insurance industry? I would like to remind my colleagues that the Federal budget is full of expenditures for long-lasting programs that were originally intended to be ``temporary.'' I am disappointed to be proven correct. I am also skeptical that, having renewed the program once, Congress will ever allow it to expire, regardless of the recommendations made by the commission created by this bill. As Congress considers extending this program, I renew my opposition to it for substantially the same reasons I stated 4 years ago. However, I do have a suggestion on how to improve the program. Since one claimed problem with allowing the private market to provide terrorism insurance is the difficulty of quantifying the risk of an attack, the taxpayers' liability under the terrorism reinsurance program should be reduced for an attack occurring when the country is under orange or red alert. After all, because the point of the alert system is to let Americans know when there is an increased likelihood of an attack it is reasonable to expect insurance companies to demand that their clients take extra precautionary measures during periods of high alert. Reducing taxpayer subsidies will provide an incentive to ensure private parties take every possible precaution to minimize the potential damage from possible terrorists attack. While this bill does contain some provisions making it more favorable to taxpayers than the original program, my fundamental objections to the program remain the same as 4 years ago. Therefore, I am attaching my statement regarding H.R. 3210, which created the terrorist insurance program in the 107th Congress: Mr. Speaker, no one doubts that the government has a role to play in compensating American citizens who are victimized by terrorist attacks. However, Congress should not lose sight of fundamental economic and constitutional principles when considering how best to provide the victims of terrorist attacks just compensation. I am afraid that H.R. 3210, the Terrorism Risk Protection Act, violates several of those principles and therefore passage of this bill is not in the best interests of the American people. Under H.R. 3210, taxpayers are responsible for paying 90 percent of the costs of a terrorist incident when the total cost of that incident exceeds a certain threshold. While insurance companies technically are responsible under the bill for paying back monies received from the Treasury, the administrator of this program may defer repayment of the majority of the subsidy in order to ``avoid the likely insolvency of the commercial insurer,'' or avoid ``unreasonable economic disruption and market instability.'' This language may cause administrators to defer indefinitely the repayment of the loans, thus causing taxpayers to permanently bear the loss. This scenario is especially likely when one considers that ``avoid . . . likely insolvency, unreasonable economic disruption, and market instability'' are highly subjective standards, and that any administrator who attempts to enforce a strict repayment schedule likely will come under heavy political pressure to be more ``flexible'' in collecting debts owed to the taxpayers. The drafters of H.R. 3210 claim that this creates a ``temporary'' government program. However, Mr. Speaker, what happens in 3 years if industry lobbyists come to Capitol Hill to explain that there is still a need for this program because of the continuing threat of terrorist attacks. Does anyone seriously believe that Congress will refuse to reauthorize this ``temporary'' insurance program or provide some other form of taxpayer help to the insurance industry? I would like to remind my colleagues that the Federal budget is full of expenditures for long- lasting programs that were originally intended to be ``temporary.'' H.R. 3210 compounds the danger to taxpayers because of what economists call the ``moral hazard'' problem. A moral hazard is created when individuals have the costs incurred from a risky action subsidized by a third party. In such a case individuals may engage in unnecessary risks or fail to take steps to minimize their risks. After all, if a third party will bear the costs of negative consequences of risky behavior, why should individuals invest their resources in avoiding or minimizing risk? While no one can plan for terrorist attacks, individuals and businesses can take steps to enhance security. For example, I think we would all agree that industrial plants in the United States enjoy reasonably good security. They are protected not by the local police, but by owners putting up barbed wire fences, hiring guards with guns, and requiring identification cards to enter. One reason private firms put these security measures in place is because insurance companies provide them with incentives, in the form of lower premiums, to adopt security measures. H.R. 3210 contains no incentives for this private activity. The bill does not even recognize the important role insurance plays in providing incentives to minimize risks. By removing an incentive for private parties to avoid or at least mitigate the damage from a future terrorist attack, the government inadvertently increases the damage that will be inflicted by future attacks. Instead of forcing taxpayers to subsidize the costs of terrorism insurance, Congress should consider creating a tax credit or deduction for premiums paid for terrorism insurance, as well as a deduction for claims and other costs borne by the insurance industry connected with offering terrorism insurance. A tax credit approach reduces government's control over the insurance market. Furthermore, since a tax credit approach encourages people to devote more of their own resources to terrorism insurance, the moral hazard problems associated with federally funded insurance is avoided. The version of H.R. 3210 passed by the Financial Services committee took a good first step in this direction by repealing the tax penalty which prevents insurance companies from properly reserving funds for human-created catastrophes. I am disappointed that this sensible provision was removed from the final bill. Instead, H.R. 3210 instructs the Treasury Department to study the benefits of allowing insurers to establish tax-free reserves to cover losses from terrorist events. The perceived need to study the wisdom of cutting taxes while expanding the federal government without hesitation demonstrates much that is wrong with Washington. In conclusion, Mr. Speaker, H.R. 3210 may reduce the risk to insurance companies from future losses, but it increases the costs incurred by American taxpayer. More significantly, by ignoring the moral hazard problem this bill may have the unintended consequence of increasing the losses suffered in any future terrorist attacks. Therefore, passage of this bill is not in the long-term interests of the American people.