Ron Paul

Mr. PAUL

Mr. PAUL. Mr. Chairman, I rise in support of the Sanders amendment. This amendment eliminates one of the serious threats to individual liberty contained in the misnamed ``Patriot Act''--the section allowing Federal officials to conduct broad searches of bookstores and libraries without demonstrating probable cause. This law erodes the First Admendment rights of those who patronize libraries and bookstores. It even forbids librarians and bookstore owners from telling their patrons that their records have been searched. Librarians and booksellers across the country have expressed vehement opposition to this measure, as have defenders of individual liberty across the political spectrum. This amendment could degrade informed political debate and discussion among the American people. Knowing that the Federal Government could snoop into their reading material choices could cause people to refrain from investigating views on political, social, or historical topics considered ``out of the mainstream.'' People may even be reluctant to seek out material critical of the government's policies. Considering the history of administrations of both parties using the IRS and FBI to harass political opponents, it is clear that Americans should be concerned about the Federal Government's new powers. One does not need to revive the phantoms of Richard Nixon and J. Edgar Hoover to justify concerns over these new powers. Americans are right now being investigated for the ``crime'' of reading material that questions government policies. For example, I ask my colleagues to consider the case of Mark Schultz of Atlanta. As detailed in the independent newspaper Creative Loafing, Mr. Schultz was questioned by two agents of the Federal Bureau of Investigation (FBI) for reading ``suspicious material.'' The ``suspicious material'' in question was an article critical of the major media's coverage of the Iraqi war; apparently critics of Rupert Murdock are now considered potential terrorists! This provision not only threatens the liberties of Americans, its effectiveness as a terrorism fighting measure is highly dubious, to say the least. After all, how likely is it that a terrorist will go to the local public library and check out ``how to'' books on hijacking and bioterrorism? Instead of investigating Americans whose reading list do not meet the approval of the FBI, the Federal Government should effectively fight terrorism by reforming our Nation's immigration policies to restrict immigration from terrorist sponsoring countries. I have introduced legislation, the Terrorist Immigration Elimination Act (H.R. 488), to do just that. In conclusion, Mr. Chairman, I urge my colleagues to protect the First Amendment rights of innocent Americans to use public libraries and bookstores without fear of government harassment by voting for the Sanders amendment.

Mr. PAUL

Mr. PAUL. Mr. Chairman, I was planning to offer an amendment to the Foreign Operations Appropriations Bill preventing tax dollars from going to the domestic shrimping industry's major foreign competitors. However, I have been informed that this amendment would be ruled out of order by the parliamentarian as legislating on an appropriations bill. While I am disappointed the House will not consider my amendment, I do wish to take this opportunity to comment on the merits of my amendment, which is based on language contained in my Shrimp Importation Financing Fairness Act. The United States domestic shrimping industry is a vital social and economic force in many coastal communities across the United States, including several in my congressional district. A thriving shrimping industry benefits not only those who own and operate shrimp boats, but, also, food processors, hotels and restaurants, grocery stores, and all those who work in and service these industries. Shrimping also serves as a key source of safe domestic food at a time when the nation is engaged in hostilities abroad. However, the Federal Government is strangling this vital industry with excessive regulations. For example, the Federal Government has imposed costly regulations, dealing with usage of items such as by catch reduction devices and turtle excluder devices (TEDS), on the industry. The mandatory use of these devices results in a significant reduction in the amount of shrimp caught by domestic shrimpers, thus damaging their competitive position and market share. Seven foreign countries--Thailand, Vietnam, India, China, Ecuador, Indonesia, and Brazil--have taken advantage of the domestic shrimping industry's government-created vulnerabilities. These countries have each exported in excess of 20,000,000 pounds of shrimp to the United States in the first 6 months of 2002. These seven countries supplied nearly 70 percent of all shrimp consumed in the United States in the first 6 months of 2002 and nearly 80 percent of all shrimp imported to this country in the same period. Adding insult to injury the Federal Government is forcing American shrimpers to subsidize their competitors. From 1999-2002, the U.S. Government provided approximately $2,172,220,000 in financing and insurance for these foreign countries through the Overseas Private Investment Corporation (OPIC). Furthermore, the United States' current exposure relative to these countries through the Export-Import Bank totals approximately $14,800,000,000. Thus, the United States taxpayer is providing a subsidy of at least $16,972,220,000 to the home countries of the leading foreign competitors of American shrimpers! Many of the countries in question do not have free-market economies. Thus, the participation of these countries in U.S.-supported international financial regimes amounts to American shrimpers directly subsidizing their international competitors. In any case, providing aid to any of these countries indirectly benefits foreign shrimpers because of the fungibility of money. In order to ensure that American shrimpers are not forced to subsidize their competitors, my amendment forbids taxpayer dollars from being used to support Export-Import and OPIC subsidies to the countries that imported more than 20 million pounds of shrimp in the first 6 months of 2002. Mr. Chairman, it is time for Congress to stop subsidizing the domestic shrimping industry's leading competitors. Otherwise, the government-manufactured depression in the price of shrimp will decimate the domestic shrimping industry and the communities whose economies depend on this industry. I therefore hope that Congress will soon stand up for American shrimpers by passing my Shrimp Importation Financing Fairness Act.

Mr. PAUL

Mr. PAUL. Mr. Chairman, let me mention once again that the amendment strikes all the funding for UNESCO. We have been out of UNESCO since 1984. President Reagan took us out of UNESCO, and that was a very popular move. The argument now is that UNESCO has made some reforms and therefore we should get back in. But their goals have not changed. I have already mentioned some of the goals of UNESCO, and they are not beneficial to us and they do not represent American ideals; it is an attack on American sovereignty. But during these 18 years since we have been out of UNESCO, it has only been the last year or two where they have talked about reforms. So over all these years, nothing has been done. But more importantly, it is the goals of UNESCO. For instance, UNESCO's position on international taxation is that they would like to impose an international tax. If that is what the people want, if that is what the Congress wants, then you vote against my amendment. But if you think it is a bad idea for the U.N. and UNESCO to be leveling a worldwide tax, then you vote for my amendment. I do not think the American people want that. I think the American people do not want to sacrifice their sovereignty and they would like not to have the United Nations and UNESCO interfering in our curricula. We have enough problems ourselves here to allow our States and our local communities to manage their schools with the interference of the Federal Government. And now here we are talking about an international organization designing a curriculum for our schools. Their goals are not American. Their goals are internationalist. I quoted just a little while ago from one of their pamphlets that says they do not even believe in nationalism, that it was a bad thing, that it was a result of families teaching children bad things, to believe in nationalism. I do not believe that. I have not come around to that belief. Being a member in a world community does not mean that you have to sacrifice your sovereignty. Being a member of a world community means that we should get along with people, that we should not be fighting with people, we should be trading with people; but that does not imply the necessity of having an international government. This is what is implied here. In this day and age we go to war under U.N. resolutions; but here our children are going to war with the education system by the United Nations dictating to us educational standards. But they do other things as well. UNESCO, for instance, has been fully supportive of the United Nations Population Fund in its assistance to China's brutal, coercive population control program. That is part of UNESCO. I do not believe the majority of the Members of Congress really believe that is a good expenditure. And you cannot control the money once it gets to UNESCO, believe me. We send the money, we send a larger amount of money than anybody else, we lose control of it and they do these things that I think are illegitimate as far as our Constitution is concerned. UNESCO has designated already 47 U.N. biosphere reserves in the United States covering more than 70 million acres without congressional consultation. This project has led to the confiscation of private lands and restrictions. Because we do go along with the restrictions, it is somewhat like following WTO mandates. They come back with regulations and mandates, and we accommodate them by rewriting our tax laws. In the same way, they are moving in, with radical environmentism that originates from UNESCO and it filters into our grade schools as well as our kindergartens. UNESCO effectively bypasses congressional authority to manage Federal lands, including places like the Everglades, and it is done without congressional approval. UNESCO's World Heritage Convention has taken treasured American public monuments to be designated world heritage sites. This is a movement away from the concept of national sovereignty. This means that there will not be control by the American people through their Representative. That makes every single one of us less significant, not only in the issue of war but now in the issue of schools and taxation. Yes, it moves slowly, it is not overwhelming; we still have a lot of control, but we are losing it gradually. And we do know that even those who objected to the war in Iraq would have been quite happy if only the United Nations would have passed a resolution that permitted us to go to war. I do not like that kind of a world. The only oath of office I take is the oath to the U.S. Constitution and UNESCO does not conform to that oath.

Mr. PAUL. Mr. Chairman, I move to strike the requisite number of words.

Mr. PAUL. Mr. Chairman, I offer an amendment. The Clerk will designate the amendment.

Mr. PAUL. Mr. Chairman, my amendment is very simple and clear. It is to strike the funds for UNESCO. We have been out of UNESCO since 1984, since President Reagan took us out of UNESCO, and the proposal now is that we rejoin. And this strikes the funding, which I think is a good idea. UNESCO was started with a bad idea. It became very corrupted, and it was almost unanimous that we get out of UNESCO in 1984, and actually I see no reason for us to rejoin. Let me just mention a few things that UNESCO is involved in. They came across, when we were in there, as being very anti-American, certainly anti-freedom, and certainly anti-first amendment. UNESCO's main function is to mettle in the education affairs of individual neighborhoods, nations, by proposing global school curriculums; something that we hardly need. In one of the publications put out from UNESCO it describes rather well what their intentions are. The publication is called Toward World Understanding. Let me just quote from that. ``One of the chief aims of education today should be to prepare boys and girls to take an active part in the creation of a world society. As long as the child breathes the poisoned air of nationalism, education and world mindedness can produce only rather precarious results. As we have pointed out, it is frequently the family,'' the family, it says, ``that infects the child with extreme nationalism. The schools should, therefore, use the means described earlier to combat family attitudes.'' Now, that is coming from a publication put out by UNESCO and states one of their goals. And I might just remind my colleagues of who the founding director general was, and that happened to have been Sir Julian Huxley. Huxley helped to write some of the goals set in the UNESCO, and he happens to be a believer in eugenics, but let me just quote from him what he thought this organization should do. He says, ``The general philosophy of UNESCO should be a scientific world humanism.'' And those words have not been changed; they still exist in these documents. They have not repealed that concept. He goes on to say, ``In its education program, it can stress the ultimate need for world political unity and familiarize all people with the implications of the transfer of full sovereignty from separate nations to a world organization.'' They are rather explicit in what the goal of UNESCO is through the educational process. ``It is also to help the emergence of a single world culture, even though it is quite true that any radical eugenic policy could not be passed now,'' they say, ``in time, the world will become ready for it.'' So I warn my colleagues about rejoining UNESCO, believing very sincerely that it is not in our interest. It costs us a lot of money. It does not represent the goals and the culture and the beliefs of Americans. We did get out because it represented us badly, and here we are about to get back into UNESCO. I urge support for my amendment.

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

Mr. PAUL

Mr. PAUL. Mr. Chairman, I rise in support of this amendment. I want to compliment the gentleman from Idaho (Mr. Otter) for bringing this to the floor. When the PATRIOT Act was passed, it was in the passions following 9/ 11, and that bill should have never been passed. It was brought up carelessly, casually, in a rapid manner. The bill that had been discussed in the Committee on the Judiciary was removed during the night before we voted. The full text of this bill was very difficult to find. I am convinced that very few Members were able to review this bill before voting. That bill should have never passed. We certainly should continue to maintain the sunset provisions. But that is a long way off, and we should be starting to reform and improve this particular piece of legislation. This is our first chance to do so. I have had many Members in the Congress come to me and on the quiet admit to me that voting for the PATRIOT Act was the worst bill and the worst vote they have ever cast; and this will give them an opportunity to change it, although this is very narrow. It is too bad we could not have made this more broad, and it is too bad we are not going to get to vote on the amendment of the gentleman from Vermont (Mr. Sanders) to make sure that without the proper search warrant that the Federal Government would not have access to the library records. But there is no need ever to sacrifice liberty in order to maintain security. I feel more secure when I have more liberty; and that is why I am a defender of liberty, because my main concern is security, both in the physical sense as well as the financial sense. I think the freer the country is, the more prosperous we are; and the freer the country is, the more secure we are. Yet it was in the atmosphere of post-9/11 that so many were anxious to respond to what they perceived as demands by the people to do something. But just to do something, if you are doing the wrong thing, what good is it? You are doing more harm. But my main argument is that there is never a need to sacrifice liberty in order to protect liberty, and that is why we would like to at least remove this clause that allows sneak-and-peak search warrants. It took hundreds, if not thousands, of years to develop this concept that governments do not have the right to break in without the proper procedures and without probable cause. And yet we threw that out the window in this post-9/11 atmosphere, and we gave away a lot. Yes, we talked about numbers of dozens of examples of times when our government has used this and abused it. But that is only the beginning. It is the principle. If they had only done it once, if they had not done it, this should still be taken care of, because as time goes on, and if we adapt to this process, it will be used more and more, and that is throwing away a big and important chunk of our Constitution, the fourth amendment. Not only should we do whatever we can to reform that legislation, but we already know that there is a PATRIOT Act No. 2. It has not been given to us, the Congress; but the administration has it for the future. It is available, but we have only gotten to see it from the Internet. In that bill there is a proposal that the government can strip us of our citizenship, and then anybody then stripped of their citizenship could be put into the situation that many foreigners find themselves in at Guantanamo before the military tribunals. I see this as a very, very important issue, if anybody cares about liberty, if anybody cares about personal freedom and the rule of law and the need for probable cause before our government comes barging into our houses. It has been under the guise of drug laws that have in the past instituted many of these abuses, but this is much worse. This has been put into an explicit piece of legislation, and the American people and this Congress ought to become very alert to this and realize how serious the PATRIOT Act is. I hope that the Congress and our colleagues here will support this amendment. It is very necessary, and it will be voting for the Constitution; and it will be voting for liberty if we support this amendment.

Mr. PAUL. Mr. Chairman, I move to strike the requisite number of words. (Mr. PAUL asked and was given permission to revise and extend his remarks.)

Mr. PAUL. Mr. Chairman, I thank the gentleman for yielding me the time. As a cosponsor of the amendment, I rise in support of this amendment and appreciate the fact that the gentleman from New York has brought it to the floor. I would suggest that the previous speaker has forgotten some of the law; and to me, that would be the constitutional law of the ninth and tenth amendments. So changing the law is one thing, but remembering the Constitution is another. This has a lot to do with State law; but more importantly, as a physician, I see this bill as something dealing with compassion. As a physician, I have seen those who have died with cancer and getting chemotherapy and with AIDS and having nothing to help them. There is the case in California of Peter McDaniels, who was diagnosed with cancer and AIDS. California changed the law and permitted him to use marijuana if it was self-grown, and he was using it; and yet although he was dying, the Federal officials came in and arrested him and he was taken to court. The terrible irony of this was here was a man that was dying and the physicians were not giving him any help; and when he was tried, it was not allowed to be said that he was obeying the State law. That is how far the ninth and tenth amendments have been undermined, that there has been so much usurpation of States' rights and States' abilities to manage these affair, and that is why the Founders set the system up this way in order that if there is a mistake it not be monolithic; and believe me, the Federal Government has made a mistake not only here with marijuana, with all the drug laws, let me tell my colleagues. There are more people who die from the use of legal drugs than illegal drugs. Just think of that. More people die from the use of legal drugs; and also, there are more deaths from the drug war than there are from deaths from using the illegal drugs. So it has gotten out of control. But the whole idea that a person who is dying, a physician cannot even prescribe something that might help them. The terrible irony of Peter McDaniels was that he died because of vomiting, something that could have and had only been curtailed by the use of marijuana. No other medication had helped; and we, the Federal Government, go in there and deny this and defy the State law, the State law of California. Yes, I would grant my colleagues there is danger in all medications. There is some danger in marijuana, but I do not know of any deaths that is purely marijuana-related. If we want to talk about a deadly medication or a deadly drug that kills literally tens of thousands in this country, it is alcohol. And how many people want to go back to prohibition? I mean, nobody's proposing that, and yet that is a deadly drug. The whole notion that we can deny this right to the States to allow a little bit of compassion for a patient that is dying, I would say this is a compassionate vote. If we care about the people being sick, then we have to vote for this amendment. This will do nothing to increase the use of bad drugs. The bad drugs are there; and as a physician and a parent and a grandparent, I preach against it all the time, but the unwise use of drugs is a medical problem, just like alcoholism is a medical problem; but we have turned this into a monster to the point where we will not even allow a person dying from cancer and AIDS to get a little bit of relief. I strongly urge support and a positive vote for this amendment.

Mr. PAUL

Mr. PAUL. Madam Speaker, the truth about whether or not Saddam Hussein was trying to buy uranium from Niger has dominated the news for the past several weeks. Many of those challenging the administration on this issue are motivated more by politics than by policy. Some doing the challenging were strongly in favor of going to war against Iraq when it appeared politically popular to do so, but are now chagrined that the war is not going as smoothly as was hoped. I am sure once the alleged attempt to buy uranium is thoroughly debunked, the other excuses for going to war will be examined with a great deal of scrutiny as well. It is obvious that the evidence used to justify going to war is now less than convincing. The charge that Saddam Hussein had aluminum tubes used in manufacturing nuclear weapons was in error. A fleet of unmanned aerial vehicles capable of dispensing chemical and biological weapons did not exist. The 63,000 liters of anthrax and botulism have not been found, nor have any of the mobile germ labs. There are no signs of the 1 million pounds of sarin, mustard and VX gasses. No evidence has been revealed to indicate Iraq was a threat to anyone's security, let alone ours. The charge that Saddam Hussein was connected to the al Qaeda was wrong. Saddam Hussein's flaunting of the UN resolutions regarding weapons of mass destruction remains unproven. How could so many errors have occurred? Some say it was ineptness while others claim outright deception and lies. There are some who say it was selective use of intelligence to promote a particular policy already decided upon. This debate, I am sure, will rage on for a long time, and since motivations are subjective and hard to prove, resolving the controversy will be difficult. However, this should not diminish the importance of sorting out the truth from the fiction, the errors from the malice. One question, though, I hope gets asked is why should we use intelligence cited by a foreign government as a justification for going to war? One would think that with the billions we spend, we could fully rely on our own intelligence-gathering agencies. Another point of interest, lacking a coherent foreign policy, we have support for war coming from different groups depending on circumstances unrelated to national defense. For instance, those who strenuously objected to Kosovo promoted war in Iraq. And those who objected to Iraq are now anxious to send troops to Liberia. For some, U.N. permission is important and necessary. For others, the U.N. is helpful as long as it endorses the war they want. Only a few correctly look to the Constitution and to the Congress to sort out the pros and cons of each conflict and decide whether or not a declaration of war is warranted. The sad fact is that we have lost our way. A threat to national security is no longer a litmus test for sending troops hither and yon, and the American people no longer require Congress to declare the wars we fight. Hopefully, some day that will be changed. The raging debate over whether or not Saddam Hussein tried to buy uranium, as important as it is, distracts from the much more important strategic issue of what is the proper foreign policy in a republic. Hopefully, we will soon seriously consider the policy of noninterventionism in the affairs of others. Avoiding entangling alliances and staying out of the internal affairs of other nations is a policy most conducive to peace and prosperity and one the Founders endorsed. Policing the world and nation building are not part of a constitutional republic.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise to introduce the Honest Money Act. The Honest Money Act repeals legal tender laws, a.k.a. forced tender laws, that compel American citizens to accept fiat--arbitrary--irredeemable paper-ticket or electronic money as their unit of account. Absent legal tender laws, individuals acting through the markets, rather than government dictates, determine what is to be used as money. Historically, the free-market choice for money has been some combination of gold and silver. As Dr. Edwin Vieira, the nation's top expert on constitutional monetary policy says: ``. . . a free market functions most efficiently and most fairly when the market determines the quality and the quantity of money that's being used.'' While fiat money is widely accepted thanks to legal tender laws, it does not maintain its purchasing power. This works to the disadvantage of ordinary people who lose the purchasing power of their savings, pensions, annuities, and other promises of future payment. Most importantly, because of the subsidies our present monetary system provides to banks, which, as Federal Reserve Chairman Alan Greenspan has stated, ``induces'' the financial system to increase leverage, the Federal Government can create additional money, in Mr. Greenspan's words, ``without limit.'' For this reason, absent legal tender laws, many citizens would refuse to accept fiat irredeemable paper-ticket or electronic money. Legal tender laws disadvantage ordinary citizens by forcing them to use money that is vulnerable to vast depreciation. As Stephen T. Byington wrote in the September 1895 issue of the American Federationist: ``No legal tender law is ever needed to make men take good money; its only use is to make them take bad money. Kick it out!'' Similarly, the American Federation of Labor asked: If money is good and would be preferred by the people, then why are legal tender laws necessary? And, if money is not good and would not be preferred by the people, then why in a democracy should they be forced to use it? The American Federation of Labor understood how the erosion of the value of money cheated working people. Further, honest money, i.e., specie, was one of the three issues that encouraged ordinary people to organize into unions when the union movement began in the U.S. circa 1830. While harming ordinary citizens, legal tender laws help expand the scope of government beyond that to which it is authorized under the Constitution. However, the primary beneficiaries of legal tender laws are financial institutions, especially banks, which have been improperly granted the special privilege of creating fiat irredeemable electronic money out of thin air through a process commonly called ``fractional reserve lending.'' According to the Federal Reserve, since 1950, these private companies--banks--have created almost $8 trillion out of nothing. This has been enormously advantageous to them. The advantages given banks and other financial institutions by our fiat monetary system, which is built on a foundation of legal tender laws, allow them to realize profits that would not be available to these institutions in a free market. This represents legalized plunder of ordinary people. Legal tender laws thus enable the redistribution of wealth from those who produce it, mostly ordinary working people, to those who create and move around our irredeemable paper-ticket electronic money which is, in essence, just scrip. The drafters of the Constitution were well aware of how a government armed with legal tender powers could ravage the people's liberty and prosperity. That is why the Constitution does not grant legal tender power to the Federal Government, and the States are empowered to make legal tender only out of gold and silver (see Article 1, Section 10). Instead, Congress was given the power to regulate money against a standard, i.e., the dollar. When Alexander Hamilton wrote the Coinage Act of 1792, he simply made into law the market-definition of a dollar as equaling the silver content of the Spanish milled dollar (371.25 grains of silver), which is the dollar referred to in the Constitution. This historical definition of the dollar has never been changed, and cannot be changed any more than the term ``inch,'' as a measure of length, can be changed. It is a gross misrepresentation to equate our irredeemable paper-ticket or electronic money to ``dollars.'' However, during the 20th century, the legal tender power enabled politicians to fool the public into believing the dollar no longer meant a unit redeemable in silver or gold. Instead, the government told the people that dollar now meant a piece of government-issued paper backed up by nothing except the promises of the government to maintain a stable value of currency. Of course, history shows that the word of the government to protect the value of the dollar is literally not worth the paper it is printed on. Tragically, the Supreme Court has failed to protect the American people from unconstitutional legal tender laws. Salmon Chase, who served as Secretary of the Treasury in President Lincoln's administration, when he was Chief Justice of the Supreme Court, dissenting in Knox vs. Lee, summed up the argument against legal tender laws in twelve words: ``The legal tender quality [of money] is only valuable for the purposes of dishonesty.'' [Emphasis added.] Another prescient Justice was Stephen Field, the only Justice to dissent in every legal tender case to come before the Court. Justice Field accurately described the dangers to our constitutional republic posed by legal tender laws: ``The arguments in favor of the constitutionality of legal tender paper currency tend directly to break down the barriers which separate a government of limited powers from a government resting in the unrestrained will of Congress. Those limitations must be preserved, or our government will inevitably drift from the system established by our Fathers into a vast, centralized, and consolidated government.'' A government with unrestrained powers is properly characterized as a tyranny. Repeal of legal tender laws will help restore constitutional government and protect the people's right to a medium of exchange chosen by the market, thereby protecting their current purchasing power as well as their pensions, savings, and other promises of future payment. Because honest money serves the needs of ordinary people, instead of fiat irredeemable paper-ticket electronic money that improperly transfers the wealth of society to a small specially privileged financial elite along with other special interests, I urge my colleagues to cosponsor the Honest Money Act.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise to introduce legislation to withdraw the United States from the Bretton Woods Agreement and thus end taxpayer support for the International Monetary Fund (IMF). Rooted in a discredited economic philosophy and a complete disregard for fundamental constitutional principles, the IMF forces American taxpayers to subsidize large, multinational corporations and underwrite economic destruction around the globe. This is because the IMF often uses the $46.7 billion line of credit provided to it by the American taxpayers to bribe countries to follow destructive, statist policies. Just last year, Argentina was rocked by an economic crisis caused by IMF policies. Despite clear signs over the past several years that the Argentine economy was in serious trouble, the IMF continued pouring taxpayer-subsidized loans with an incredibly low interest rate of 2.6 percent into the country. In 2001, as Argentina's fiscal position steadily deteriorated, the IMF funneled over 8 billion dollars to the Argentine government! According to Congressman Jim Saxton, Chairman of the Joint Economic Committee, this ``Continued lending over many years sustained and subsidized a bankrupt Argentine economic policy, whose collapse is now all the more serious. The IMF's generous subsidized bailouts lead to moral hazard problems, and enable shaky governments to pressure the IMF for even more funding or risk disaster.'' Argentina is just the latest example of the folly of IMF policies. Five years ago the world economy was rocked by an IMF-created disaster in Asia. The IMF regularly puts the taxpayer on the hook for the mistakes of the big banks. Oftentimes, Mr. Speaker, IMF funds end up in the hands of corrupt dictators who use our taxpayer-provided largesse to prop up their regimes by rewarding their supporters and depriving their opponents of access to capital. If not corrupt, most IMF borrowers are governments of countries with little economic productivity. Either way, most recipient nations end up with huge debts that they cannot service, which only adds to their poverty and instability. IMF money ultimately corrupts those countries it purports to help, by keeping afloat reckless political institutions that destroy their own economies. IMF policies ultimately are based on a flawed philosophy that says the best means of creating economic prosperity is through government- to-government transfers. Such programs cannot produce growth, because they take capital out of private hands, where it can be allocated to its most productive use as determined by the choices of consumers in the market; and place it in the hands of politicians. Placing economic resources in the hands of politicians and bureaucrats inevitably results in inefficiencies, shortages, and economic crises, as even the best-intentioned politicians cannot know the most efficient use of resources. In addition, the IMF violates basic constitutional and moral principles. The Federal Government has no constitutional authority to fund international institutions such as the IMF. Furthermore, Mr. Speaker, it is simply immoral to take money from hard-working Americans to support the economic schemes of politically-powerful special interests and third-world dictators. In all my years in Congress, I have never been approached by a taxpayer asking that he or she be forced to provide more subsidies to Wall Street executives and foreign dictators. The only constituency for the IMF is the huge multinational banks and corporations. Big banks used IMF funds--taxpayer funds--to bail themselves out from billions in losses after the Asian financial crisis. Big corporations obtain lucrative contracts for a wide variety of construction projects funded with IMF loans. It's a familiar game in Washington, with corporate welfare disguised as compassion for the poor. Last year's Argentine debacle is yet further proof that the IMF was a bad idea from the very beginning--economically, constitutionally, and morally. The IMF is a relic of an era when power-hungry bureaucrats and deluded economists believed they could micromanage the world's economy. Withdrawal from the IMF would benefit American taxpayers, as well as workers and consumers around the globe. I hope my colleagues will join me in working to protect the American taxpayer from underwriting the destruction of countries like Argentina, by cosponsoring my legislation to end America's support for the IMF.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise to introduce the Senior Citizens Freedom of Choice of Act. This act ensures that participation in the Medicare program is completely voluntary. I also ask unanimous consent to insert into the record a letter sent to my office from a citizen who is trying to receive Social Security benefits without being forced to enroll in Medicare Part A, along with a letter from the Social Security Administration admitting that seniors who do not enroll in Medicare Part A are denied Social Security benefits. When Medicare was first established, seniors were promised that the program would be voluntary. In fact, the original Medicare legislation explicitly protected a senior's right to seek out other forms of medical insurance. However, today, the Social Security Administration refuses to give seniors Social Security benefits unless they enroll in Medicare Part A. This not only distorts the intent of the creators of the Medicare system, it also violates the promise represented by Social Security. Americans pay taxes into the Social Security Trust Fund their whole working lives and are promised that Social Security will be there for them when they retire. Yet, today, seniors are told that they cannot receive these benefits unless they agree to join another government program! At a time when the fiscal solvency of Medicare is questionable, to say the least, it seems foolish to waste scarce Medicare funds on those who would prefer to do without Medicare. Allowing seniors who neither want nor need to participate in the program to refrain from doing so will also strengthen the Medicare program for those seniors who do wish to participate in it. Of course, my bill does not take away Medicare benefits from any senior. It simply allows each senior to choose voluntarily whether or not to accept Medicare benefits. Seniors may wish to refuse Medicare for a variety of reasons. Some seniors may wish to continue making their own health care decisions, rather than have those decisions made for them by the Centers for Medicare and Medicaid Services (CMS). Other seniors may have a favorite physician who is one of the growing number of doctors who have been driven out of the Medicare program by CMS's micromanagement of their practices and below-cost reimbursements. Forcing seniors into any government program as a precondition of receiving their promised Social Security benefits both violates the promise of Social Security and infringes on the freedom of seniors who do not wish to participate in Medicare. As the author of the submitted letter says, ``. . . I should be able to choose the medical arrangements I prefer without suffering the penalty that is being imposed.'' I urge my colleagues to protect the rights of seniors to make the medical arrangements that best suit their own needs by cosponsoring the Senior Citizens Freedom of Choice Act. Congressman Ron Paul U.S. Congress, Washington, DC. Dear Congressman Paul: I am writing to inform you about a structural problem in Medicare of which you may he unaware and that I believe must be remedied, all the more so now that there are rumors that Medicare, Part A, might be combined with Medicare, Part B. In brief; the problem to which I refer involves the requirement that a Medicare eligible individual enroll in Medicare, Part A as a condition of receiving Social Security benefits to which he or she is entitled. In fact, the Social Security Administration has combined the enrollment forms for the two programs, so that an application for Social Security benefits to which one is entitled automatically entails enrollment in Medicare, Part A. I discovered this in June 2001 when I went with my husband to apply for my Social Security benefits. I made it quite clear that I would not enroll in Medicare, Part A due to my objections to certain aspects of this program. (The objectionable aspects include invasion of privacy and limitation of medical choice.) In response I was told that I then could not receive the Social Security benefits to which I am otherwie entitled. Further communication with CMS by myself and by the office of Senator Kennedy on my behalf confirmed that CMS and the Social Security Administration take the position that ``the Medicare program, Part A . . . [is] a benefit completely linked to the monthly social security benefit for those age 65 or older.'' Indeed I was sent a copy of federal regulation 404.640 (entitled ``Withdrawal of an application''), which states that anyone who enrolls in Medicare, Part A and then decides later to withdraw will have to return all benefits received. (Another document I received states that this includes both medical benefits and social security benefits.) Upon receipt of a copy of the letter, dated October 12, 2001, sent to Senator Kennedy regarding my complaint. I followed that letter's suggestion that I make an attempt to file ``a restricted application for Social Security benefits.'' This I did in a letter, dated May 15, 2002, to the regional commissioner for Social Security, Manual Vaz. The response to my letter to Mr. Vaz came from the local (Waltham) Social Security office. In that letter, dated May 29, 2002. I was told that it was impossible to make a restricted application, i.e., an ``application for cash social security retirement benefits only.'' Thus I was left with no recourse. I could not appeal a denial of my ``restricted'' application, because I was not even permitted to make the application. Short of an expensive lawsuit or an Act of Congress, there appears to be no remedy. This is no trivial matter for me. I have now lost two years of Social Security benefits. It is not clear when or if I will ever receive these benefits. All those with whom I have discussed this problem, irrespective of their political persuasion, have been shocked to hear about these regulations. I believe that I should be able to choose the medical arrangements I prefer without suffering the penalty that is being imposed. I ask that you take steps to remedy this situation. I shall be happy to supply documentation regarding the facts outlined above, it you request it. I look forward to hearing from you. Sincerely,______.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise to protect American liberty, privacy and economic well-being by introducing legislation to prohibit the Federal Government from imposing a ``carry tax.'' A carry tax is a tax imposed on Americans that requires them to pay a tax whenever they make a bank deposit. The amount of the tax is based on how long their money has been in circulation. Hard as it may be to believe, some in the Federal Government have actually considered imposing this tax on American citizens. Since this bill punishes those who rely on cash for the majority of their economic transactions, and since lower income Americans tend to rely on cash for their economic transactions, this is a highly regressive tax plan. Furthermore, since the plan is designed to lower interest rates, it will negatively impact those who rely on investment income for a significant part of their income. Thus, the carry tax will lower the income of millions of senior citizens. Proposals to punish people if their economic behavior meets with the disapproval of government officials form the foundation of the type of central planning which caused so much misery in the last century. The carry tax proposal is obviously incompatible with a free market. This proposal is also a major threat to personal and financial privacy and thus individual liberty. In order to enforce the carry tax, the government would need a means of monitoring how long each piece of currency has been in circulation and how many hands it passed through before coming into the possession of the person on whom the tax is assessed. Thus, enforcing this tax would also give the government the power to monitor the transactions of individual Americans. The Federal Government should not abuse the authority granted it by our current monetary system and legal tender laws as a backdoor means of prying into the private economic transactions of American citizens. That is why my legislation also forbids the Federal Government from placing any information storage capacity on any Federal Reserve notes. The carry tax was proposed as a measure to counteract the perceived risk of deflation. Yet, the problems this carry tax is intended to solve are caused by our government's boom-and-bust monetary policy. Any perceived deflation in the American economy is the result of the end of the inflationary period of the nineties that created the stock market bubble. When the bubble burst, there was the inevitable process of liquidating bad investments caused by the misallocation of credit as a result of the Federal Reserve monetary policy. In fact, this liquidation is necessary for the economy to recover from the economic misallocations caused by the Federal Reserve's monetary policy. Unfortunately, rather than finally putting an end to the boom-and- bust cycle, most in Washington are preparing to resume the cycle by calling on the Federal Reserve and the Treasury to flood the economy with new money. If Congress is not going to stabilize the American economy by reforming our unstable monetary policy, it should at least refrain from using this government failure as an excuse to further restrict the American people's liberty through an odious carry tax. I therefore hope my colleagues will join me in supporting this legislation.

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise to introduce the Monetary Freedom and Accountability Act. This simple bill takes a step toward restoring Congress' constitutional authority over U.S. monetary policy by requiring congressional approval before the President or the Treasury secretary buys or sells gold. I also ask for unanimous consent to insert into the Record articles by Kelly Patricia O Meara of Insight magazine detailing the evidence supporting allegations that the United States Government has manipulated the price of gold over the past decade and the harm such manipulation caused American investors, taxpayers, consumers, and workers. Federal dealings in the gold market have the potential to seriously disrupt the free market by either artificially inflating or deflating the price of gold. Given gold's importance to America's (and the world's) monetary system, any federal interference in the gold market will have ripple effects through the entire economy. For example, if the government were to intervene to artificially lower the price of gold, the result would be to hide the true effects of an inflationary policy until the damage was too severe to remain out of the public eye. By artificially deflating the price of gold, federal intervention in the gold market can reduce the values of private gold holdings, adversely affecting millions of investors. These investors rely on their gold holdings to protect them from the effects of our misguided fiat currency system. Federal dealings in gold can also adversely affect those countries with large gold mines, many of which are currently ravished by extreme poverty. Mr. Speaker, restoring a vibrant gold market could do more than any foreign aid program to restore economic growth to those areas. While the Treasury denies it is dealing in gold, the Gold Anti-Trust Action Committee (GATA) has uncovered evidence suggesting that the Federal Reserve and the Treasury, as detailed in the attached article. GATA alleges that the Treasury, operating through the Exchange- Stabilization Fund and in cooperation with major banks and the International Monetary Fund, has been interfering in the gold market with the goal of lowering the price of gold. The purpose of this policy has been to disguise the true effects of the monetary bubble responsible for the artificial prosperity of the 1990s, and to protect the politically-powerful banks that are heavy invested in gold derivatives. GATA believes federal actions to drive down the price of gold help protect the profits of these banks at the expense of investors, consumers, and taxpayers around the world. GATA has also produced evidence that American officials are involved in gold transactions. Alan Greenspan himself referred to the federal government's power to manipulate the price of gold at hearings before the House Banking Committee and the Senate Agricultural Committee in July, 1998: ``Nor can private counterparts restrict supplies of gold, another commodity whose derivatives are often traded over-the-counter, where central banks stand ready to lease gold in increasing quantities should the price rise.''. Mr. Speaker, while I certainly share GATA's concerns over the effects of federal dealings in the gold market, my bill in no way interferes with the ability of the federal government to buy or sell gold. It simply requires that before the executive branch engages in such transactions, Congress has the chance to review it, debate it, and approve it. Given the tremendous effects on the American economy from federal dealings in the gold market, it certainly is reasonable that the people's representatives have a role in approving these transactions, especially since Congress has a neglected but vital constitutional role V in overseeing monetary policy. Therefore, I urge all my colleagues to stand up for sound economics, open government, and Congress' constitutional role in monetary policy by cosponsoring the Monetary Freedom and Accountability Act. [From Insight Magazine, July 8, 2003] Panic Is Near if ``The Gold Is Gone'' (By Kelly Patricia O Meara) Gold. It's been called a barbarous relic, and those who focus on its historic role as a standard of value frequently are labeled ``lunatic fringe.'' Given the recent highs in the gold market, it looks like the crazies have been having a hell of a year. With the stock market taking its third yearly loss, gold returned nearly 30 percent to investors, moving from $255 an ounce to six-year highs of $380. Just about every analyst and ``expert'' on Wall Street willing to mention any of this has been quick to explain that the increase in the price of gold is due to impending war with Iraq. But hard-money analysts are arguing that should the United States go to war it will be of very little consequence to the price of gold--a momentary blip--because gold is a commodity and its price a matter of supply and demand. The ``lunatic fringe'' long has argued that the price of gold was being manipulated by a ``gold cartel'' involving J.P. Morgan Chase, Citigroup, Deutsche Bank, Goldman Sachs, the Bank for International Settlements (BIS), the U.S. Treasury and the Federal Reserve, but that the manipulation had been sufficiently exposed to require that it be abandoned, producing the steady upward increase in the price of the shiny, yellow metal. In fact the ``gold bugs,'' as they're known, are so sure of their research that not only do they believe the price of gold will continue to climb, but many are expecting to see prices of $800 to $1,000 an ounce. Until recently, most in the gold and financial worlds scoffed at such a prediction, but last month the Bank of Portugal made an announcement that shocked those who credit official gold-reserve data and added fuel to the contention of the gold bugs that the ``gold- cartel'' manipulation is in meltdown. What the Bank of Portugal revealed in its 2001 annual report is that 433 tonnes [metric tons] of gold--some 70 percent of its gold reserve--either have been lent or swapped into the market. According to Bill Murphy, chairman of the Gold Anti-Trust Action Committee (GATA), a nonprofit organization that researches and studies the gold market and reports its findings at www.LeMetropoleCafe.com: ``This gold is gone--and it lends support to our years of research that the central banks do not have the 32,000 tonnes of gold in reserve that they claim. The big question is: How many other central banks are in the same predicament as the Portuguese?'' Murphy explains: ``The essence of the rigging of the gold market is that the bullion banks borrowed central-bank gold from various vaults and flooded the market with supply, keeping the price down. The GATA camp has uncovered information that shows that around 15,000 to 16,000 tonnes of gold have left the central banks, leaving the central-bank reserves with about half of what is officially reported.'' This is why those who follow such arcana are predicting an explosion in the price of gold. According to Murphy, ``The gold establishment says that the gold loans from the central banks are only 4,600 to 5,000 tonnes,'' but his information is that these loans are more than three times that number, which means ``they're running out of physical gold to continue the scheme.'' According to Murphy, ``The cartel has been able to get away with lying about the amount of gold in reserve because the International Monetary Fund [IMF] is the Arthur Andersen of the gold world.'' He has provided to Insight documents from central banks confirming that the IMF instructed them to count both lent and swapped gold as a reserve. ``In other words, the IMF told the central banks to deceive the investment and gold world[s]. Once this gold is lent [or] swapped, it's gone until such time as it can be repurchased. And with the skyrocketing price of gold we're now seeing, it would be incredibly expensive, let alone nearly physically impossible, to get it back.'' What is important to understand, says Murphy, ``is that there is a mine and scrap supply deficit of 1,500 tonnes, which is an enormous deficit when yearly mine supply is only 2,500 tonnes and going down. On top of that, there are these under-reported gold loans and other derivatives that are on the short side. There is no way to pay this gold back to the central banks without the price of gold going up hundreds of dollars per ounce. So the peasants and women of the world will have to sell their jewelry at say $800 an ounce to bail out these short positions or someone is going to have to tell the world that they don't have the gold that they have reported,'' shaking the world's financial system to its core. The gold bugs appear to be basing their identification of a world gold shortage on industry data, much of which has been summarized in two papers prepared by four different gold analysts at different times using separate methods. The first paper was written by governmental investment adviser Frank Veneroso and his associate, mining analyst Declan Costelloe. Titled Gold Derivatives, Gold Lending: Official Management of the Gold Price and the Current State of the Gold Market, it was presented at the 2002 International Gold Symposium in Lima, Peru, and estimates the gold deficit of the central banks at between 10,000 and 15,000 tonnes. The second paper, Gold Derivatives: Moving Towards Checkmate, by Mike Bolser, a retired businessman, and Reginald H. Howe, a private investor and proprietor of the Website www.goldensextant.com, estimates the alleged shortage of central-bank gold at between 15,000 and 16,000 tonnes--nearly a decade's worth of mine production. George Milling-Stanley, manager of gold-market analysis for the World Gold Council (WGC), a private organization made up of leading gold-mining companies that promotes the acquisition and retention of gold, is aware of these papers and shortage numbers but tells Insight that ``there are no official [gold-reserve] reports.'' That is, ``The central banks are under no obligation to report what they lend into the market, what they place on deposit and what they do with their swaps, so there's a conventional-wisdom view, and a couple of different bodies have done some fairly serious research in[to] this and have come up with a figure [of] around 4,500 to 5,000 tonnes.'' Stanley's estimate is based on data provided by so-called ``serious'' researchers, including Londonbased Gold Fields Mineral Services (GFMS), one of the world's foremost precious-metals consultants, and a report titled Gold Derivatives: The Market View, commissioned by the WGC to London-based Virtual Metals Consultancy. While these two groups appear to be the research choice of the official gold world, there are in fact no ``official'' figures, and both studies, like the Veneroso/Costelloe and Bolser/Howe reports, are based on interviews, data analysis and other research generally available to the industry. Those who believe the central banks to have misrepresented their actual gold holdings place much of the blame for the lack of transparency on the shoulders of the IMF, which presents itself as being responsible for ensuring the stability of the international financial system. Although the IMF would not respond to questions about its gold-loan/swap requirements, what information has been made public appears to support GATA's understanding of how central-bank reserves are reported. For example, in October 2001 the IMF responded to questions posed by GATA by saying it is not correct that the IMF insists members record swapped gold as an asset when a legal change in ownership has occurred. According to this response, ``The IMF in fact recommends that swapped gold be excluded from reserve assets.'' Nonetheless, says GATA, there is abundant evidence that this is not the case, citing as an example the Central Bank of the Philippines (BSP). A footnote on the Website of the Central Bank of the Philippines (www.bsp.gov.ph) in fact directly contradicts the IMF's claim: ``Beginning January 2000, in compliance with the requirements of the IMF's reserves and foreign-currency- liquidity template under the Special Data Dissemination Standard (SDDS), gold swaps undertaken by the BSP with noncentral banks shall be treated as collateralized loans. Thus gold under the swap arrangement remains to be part of reserves, and a liability is deemed incurred corresponding to the proceeds of the swap.'' The European Central Bank (ECB) also made it clear that the IMF policy is to include swaps and loans as reserves. The ECB responded to GATA: ``Following the recommendations set out in the IMF operational guidelines of the 'Data Template on International Reserve and Foreign Currency Liquidity,' which were developed in 1999, all reversible gold transactions, including gold swaps, are recorded as collateralized loans in balance of payments and international investment-position statistics. This treatment implies that the gold account would remain unchanged on the balance sheet.'' The Bank of Finland and the Bank of Portugal also confirmed in writing that the swapped gold remains a reserve asset under IMF regulations. Although the WGC's Stanley stands by the data provided by the industry's ``serious'' researchers, he insists he cannot say for certain that the numbers are accurate. ``There is no requirement on any country to tell the IMF how much gold it owns,'' says Stanley. ``The requirement is to tell the IMF how much gold it has decided to place in its official reserves. Nobody knows whether that is the total of what they own or not. Obviously they can't report more than what they own, but they can certainly report less if they chose to. That gold may have been lent out, but is nevertheless still owed to them. It's a bit like any company reporting a cash position. It will report cash on hand and cash due--money owed by other people. I'm not saying this is ideal, but this is how it works.'' John Embry, the manager of last year's best-performing North American gold fund and manager of the Royal Precious Metals Fund for the Royal Bank of Canada, says he is putting his and his clients' money on the ``lunatic fringe'' in this dispute: ``I've examined all the evidence gathered by GATA and everyone else, and I think these guys are anything but lunatics. They've done their homework and have unearthed a lot of interesting stuff. The problem, though, is that the market is sufficiently opaque that there is really no way to know who is right and who is wrong.'' ``The fact is,'' continues Embry, ``a lot of this stuff is based on estimations. I do however believe that, based on the evidence dug up by Veneroso and Howe, they are presenting equally if not more credible numbers than the other side. I find the campaign to undermine their credence simply bizarre. I think these guys [GATA] are right and that the number put out by Gold Fields Mineral Services as the amount of gold loaned out by the central banks is definitely wrong. Now, whether it's as much as 15,000 is up for interpretation. The recent release by the Bank of Portugal is important. When a central bank has 70 percent of its gold loaned or swapped, I don't think it is operating independently, and I suspect there are an awful lot of them that have loaned out much more than has been reported.'' Embry says, ``I've made a fortune for my clients investing in gold and gold stocks because I have operated on the premise that the Veneroso/Howe reports are right--that gold was significantly undervalued in the daily quote and that it was going a lot higher. The circumstantial evidence, and I bet my clients' money on it, was very much in favor of the guys who said a great deal more central-bank gold had entered the market and driven the price down far too low. GATA has had this story from day one. I think that they're right and that officialdom doesn't want this exposed. GATA is willing to have a public debate but the gold world won't debate. I think there is a tacit admission of anyone who has an IQ above that of a grapefruit that Veneroso and Howe have a pretty good point. I'm an analyst who has looked at both sides of the issue and I bet my money on GATA. So far they've been right.'' Whether the gold bugs are right about the reasons for the meteoric rise in the price of gold is uncertain, but, according to GATA's Murphy: ``It's all the more reason to have the central banks come clean about the actual amount of gold that physically exists in their reserves. Either way, the price of gold will continue to rise because, as we already know and others are discovering, the gold is gone.''

Mr. PAUL

Mr. PAUL. Mr. Speaker, I rise to introduce legislation to restore financial stability to America's economy by abolishing the Federal Reserve. I also ask unanimous consent to insert the attached article ``The Greatest Theft in History'' by Professor Murray Sabrin, into the Record. Professor Sabrin provides an excellent summary of how the Federal Reserve is responsible for the nation's current economic difficulties. Since the creation of the Federal Reserve, middle and working-class Americans have been victimized by a boom-and-bust monetary policy. In addition, most Americans have suffered a steadily eroding purchasing power because of the Federal Reserve's inflationary policies. This represents a real, if hidden, tax imposed on the American people. From the Great Depression, to the stagflation of the seventies, to the burst of the dotcom bubble, every economic downturn suffered by the country over the last 80 years can be traced to Federal Reserve policy. The Fed has followed a consistent policy of flooding the economy with easy money, leading to a misallocation of resources and an artificial ``boom'' followed by a recession or depression when the Fed-created bubble bursts. With a stable currency, American exporters will no longer be held hostage to an erratic monetary policy. Stabilizing the currency will also give Americans new incentives to save as they will no longer have to fear inflation eroding their savings. Those members concerned about increasing America's exports or the low rate of savings should be enthusiastic supporters of this legislation. Though the Federal Reserve policy harms the average American, it benefits those in a position to take advantage of the cycles in monetary policy. The main beneficiaries are those who receive access to artificially inflated money and/or credit before the inflationary effects of the policy impact the entire economy. Federal Reserve policies also benefit big spending politicians who use the inflated currency created by the Fed to hide the true costs of the welfare- warfare state. It is time for Congress to put the interests of the American people ahead of the special interests and their own appetite for big government. Abolishing the Federal Reserve will allow Congress to reassert its constitutional authority over monetary policy. The United States Constitution grants to Congress the authority to coin money and regulate the value of the currency. The Constitution does not give Congress the authority to delegate control over monetary policy to a central bank. Furthermore, the Constitution certainly does not empower the federal government to erode the American standard of living via an inflationary monetary policy. In fact, Congress' constitutional mandate regarding monetary policy should only permit currency backed by stable commodities such as silver and gold to be used as legal tender. Therefore, abolishing the Federal Reserve and returning to a constitutional system will enable America to return to the type of monetary system envisioned by our nation's founders: one where the value of money is consistent because it is tied to a commodity such as gold. Such a monetary system is the basis of a true free-market economy. In conclusion, Mr. Speaker, I urge my colleagues to stand up for working Americans by putting an end to the manipulation of the money supply which erodes Americans' standard of living, enlarges big government, and enriches well-connected elites, by cosponsoring my legislation to abolish the Federal Reserve. [From USA Daily, May 6, 2003] The Greatest Theft in History (By Murray Sabrin) If you have a savings account, your bank probably credits it with interest every month. At the end of the month, you expect the bank to pay you the amount of interest it was obligated to pay you--no more no less. In other words, you would not expect the bank to change the interest it was going to pay you unless your account explicitly allows the bank to readjust the interest rate at its discretion. We know the interest rate paid on short-term ``risk free'' deposits are based on the ``real rate'' plus an inflation premium. Historically, the real rate--the rental price of money--is the annual rate that borrowers and lenders agree on is typically 2-3 percent. So if you borrow $100 for a year, you would expect to pay the lender about $103 at the end of one year. However, if price inflation is expected to be 3% for the year the loan is outstanding, the lender wants to protect his principal from the decline in the dollar's purchasing power. So, the interest rate on the loan would thus not be just 2% (assuming this is the real rate), but 2% plus an inflation premium of 3%, for a total of 5%. Currently the annual inflation rate is about 2.5%. Thus, the risk free rate (the real rate-2%--plus the inflation premium) on savings deposits and money market funds should be about 4.5%. For Americans who seek the safety of savings accounts and money market funds for their hard-earned money, the current average yield of 0.7% on money market funds is well below the current risk free rate. In addition, savers who own short-term U.S. Treasury debt are receiving slightly more than 1.1 % annually. What's going on? How can savers be receiving about 3.5% less than the risk free rate on their money market accounts and savings accounts? The answer is simple: The Federal Reserve, the government created institution that was founded to ``stabilize'' the value of the dollar and ``smooth'' ``out the business cycle'', which has the legal authority to create money out of thin air, is nothing more than the greatest manipulator of interest rates in the history of the world. The FED pumps money into the banking system if it wants to lower interest rates in order ``to stimulate'' the economy, and conversely will take money out of the banking system if it want to dampen borrowing and ``cool off'' an overheated economy. For the past two-and-a-half years the FED has been pumping money into the banking system, driving down short-term interest rates to its current levels, well below the risk free rate. In fact, the American people are being penalized heavily for saving. Real interest rates are negative. In short, the American people are being ripped off to the tune of tens of billions of dollars per year. To put this in dollars and cents, there are $2.2 trillion in money market funds, with an average annual yield of 0.7%. The income from these funds is about $15 billion a year. If interest rates were 4.5%, savers would have nearly one hundred billion dollars in income or $85 billion more than they are currently receiving. Moreover, there is $4.61 trillion in the nation's time and savings deposits, earning an average of about 1.0% or more depending on the financial institution your money is deposited in. (ING Direct pays 2.10% online on short-term deposits. The money can be transferred from your checking account to an online account and back. The minimum deposit to open an account is only $1. This is not a misprint.) Using the same 4.5% risk free rate, savers should be receiving about $210 billion on their short-term deposits at the nation's financial institutions. Instead, they are earning about $50 billion, for a loss of $160 billion in annual income. In addition, the U.S. Treasury has approximately $1 trillion in short-term debt that is yielding a little more than 1%. Savers holding the federal government's short-term debt are losing approximately $35 billion in annual income. The bottom line: While the economic debate in Washington DC centers around President Bush's tax cut proposal, which should pass intact because less money in the federal government means more freedom and prosperity for the American people, the Federal Reserve continues to perpetuate the greatest theft in world history. By having the power to manipulate interest rates, the FED in effect has not only a license to print money but also can redistribute income form savers to borrowers. The winners of the FED's interest rate manipulations include the nations' financial institutions, business borrowers and government. The losers are anyone who wants to save for the proverbial rainy day and accumulate money for a down payment on a house or other family need. Thus, Federal Reserve policy aids and abets the legalized theft of hundreds of billions of dollars per year from low- and middle-income families to the economic elites of this country and profligate governments at all levels--all with the approval of the U.S. Congress and the Bush administration. After 90 years of manipulating interest rates, it is time to abolish the FED and return the country to the only sound monetary system that is consistent with liberty and prosperity--the gold standard.

Mr. PAUL

Mr. PAUL. Mr. Speaker, today I introduce the Foreign Aid Limitation Act. This bill limits the ability of the Executive Branch to use the Exchange Stabilization Fund (ESF) to distribute largesse to foreign countries without the approval of Congress. The Foreign Aid Limitation Act prohibits the Secretary of the Treasury from using the ESF to make a loan or extend credit to any foreign government or entity for an amount exceeding $250,000,000. The bill also forbids the ESF from being used to finance a loan or to extend credit, to any foreign government or entity for a period exceeding 60 days. The 60-day limitation can be waived if the President certifies in writing to the Chair and ranking members of the relevant House and Senate Committees that the United States obtained an assured source of repayment before making the loan or extending the credit. Finally, the bill prohibits the use of the ESF to make loans or extend credit in an amount exceeding $1,000,000,000 to a foreign government or entity without express statutory authorization. This provision can also be waived if the President certifies in writing to the heads of the relevant committees that the loan is necessary to address a financial crisis threatening the United States and Congress does not pass a joint resolution disapproving the loan or credit. Mr. Speaker, these provisions all passed Congress as ``riders'' on appropriations bills in the 1990s. However, they have not been included in the appropriations bills for the past several years. It is long past time for Congress to make these provisions permanent. Over the past several years there has been great controversy over the use of the Exchange Stabilization Fund. This fund was created in the 1930s to help stabilize the exchange value of the dollar, yet it has mutated into a ``slush fund'' used by the executive branch to funnel money to foreign governments and even foreign companies free of congressional oversight. In particular, there was great controversy over the Clinton administration's use of the ESF to finance the Mexican bailout without Congressional approval in 1995. Today, there is a similar controversy over the use of the ESF in the Iraq rebuilding process. Ensuring the fund is only used for narrow purposes will help end the controversy by bringing greater transparency to the disbursement of foreign aid. Even supporters of a vigorous foreign aid program should support restoring Congress' rightful role as appropriator and overseer of foreign aid funds. Mr. Speaker, it long past time for Congress to begin reasserting its constitutional role in the appropriation of funds for foreign aid programs. For too long, the Exchange Stabilization Fund has allowed the executive branch to commit the American taxpayer to supporting foreign governments without even consulting with Congress. I hope all my colleagues will join my efforts to end this practice by cosponsoring my Foreign Aid Limitation Act.

Mr. PAUL

Mr. PAUL. Mr. Chairman, I yield back the balance of my time.

Mr. PAUL. Mr. Chairman, I once again urge a yes vote on this amendment to limit the funding to the United Nations and to all its agencies. The gentleman from California (Mr. Lantos) mentioned that there were some programs under the United Nations which were sort of ``feel-good'' programs, social welfare programs, and I think I would grant that some of these programs have had some benefit. That in itself is not enough for me to endorse the concept of international welfare through the United Nations. However, too often I think they leave doing these programs that are designed to help people who are truly suffering versus getting involved with what we call peacekeeping missions. The United Nations are not allowed to declare war. They never go to war, and yet too often we get involved in war. That is why they were called peacekeepers in Korea. That is why it is a peacekeeping mission when we go to Iraq. But, still, the armies are raised, and young men are called off, and people are killed on these peacekeeping missions. Therefore, I say that the United Nations has tended to take away the responsibilities of this Congress to make these very, very important decisions. I believe in many ways that by joining the United Nations we have allowed our Constitution to be amended merely by U.N. vote. If the U.N. votes and says something and we go along with that, we do that by majority vote here in the Congress. Where if we look to the Constitution for the authorities that we are allowed to do and what we are not permitted to do, we look to article I, section 8; and what the U.N. is doing is not permissible under the article.

Mr. PAUL. Mr. Chairman, I yield myself the balance of my time.

Mr. PAUL. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from Maryland (Mr. Bartlett).

Mr. PAUL. Mr. Chairman, I yield myself 2 minutes. Mr. Chairman, this amendment takes away the funding from the United Nations as well as any affiliated U.N. agency. Mr. Chairman, last year we spent $3.25 billion on the U.N. as well as the other agencies at the U.N. I do not believe that is money worthwhile. It is not a good investment. I do not think the money is spent well. The amendment, as I said, defunds the United Nations as well as its agencies. We pay 21 percent of the budget, and on peacekeeping missions we pay over 27 percent. I think this is essentially wasted money. We also lose our sovereignty when we look to the U.N. for guidance. When we declared war or when we went to war without declaration of war last fall, we had a resolution on the floor which cited the U.N. 23 different times. I do not believe we should go to war under U.N. resolutions, and we have essentially been in Iraq under U.N. resolution because in the early 1990s it was under U.N. resolution that we went to war. The old-fashioned way of going to war was a declaration of war. We went into Korea over 50 years ago under a U.N. resolution. We are still in Korea. We still have serious problems in Korea. There is still a confrontation that we have with the government of North Korea. I do not see where it is to our benefit, I do not see where it is a benefit to world peace to rely on the United Nations. Even though we rely on the United Nations for authority, when we want the United Nations to go along with our policy as our President asked earlier this year, it was refused. So in many ways we have a policy that does not make a whole lot of sense. We first rely on the United Nations, spend a lot of money, then they do not do our bidding. It gets to be almost a joke around the world about some of the things the U.N. does. When you think about the Commission of Human Rights and who is appointed as the chairman of the Commission of Human Rights, nobody else other than Libya. And before the war it was actually Iraq who was supposed to chair the Disarmament Commission. So this I think in many ways reflects the ineptness of the United Nations and its inability to pursue any policy that is in our interest. So it is for this reason, whether it is rejoining UNESCO and throwing more money down another on another useless program, we here are spending a lot of money giving up our sovereignty. Much of this money should be spent here at home.

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

Mr. PAUL

Mr. PAUL. Mr. Speaker, the modern-day limited government movement has been co-opted. The conservatives have failed in their effort to shrink the size of government. There has not been, nor will there soon be, a conservative revolution in Washington. Party control of the Federal Government has changed, but the inexorable growth in the size and scope of government has continued unabated. The liberal arguments for limited government in personal affairs and foreign military adventurism were never seriously considered as part of this revolution. Since the change of the political party in charge has not made a difference, who is really in charge? If the particular party in power makes little difference, whose policy is it that permits expanded government programs, increased spending, huge deficits, nation- building, and the pervasive invasion of our privacy with fewer fourth amendment protections than ever before? Someone is responsible, and it is important for those of us who love liberty and resent Big Brother government to identify the philosophic supporters who have the most to say about the direction our country is going. If they are wrong, and I believe they are, we need to show it, alert the American people, and offer a more positive approach to government. However, this depends on whether the American people desire to live in a free society and reject the dangerous notion that we need a strong central government to take care of us from cradle to grave. Do the American people really believe it is the government's responsibility to make us morally better and economically equal? Do we have a responsibility to police the world while imposing our vision of good government on everyone else in the world with some form of utopian nation-building? If not, and the contemporary enemies of liberty are exposed and rejected, then it behooves us to present an alternative philosophy that is morally superior and economically sound and provides a guide to world affairs, to enhance peace and commerce. One thing is certain, conservatives who worked and voted for less government in the Reagan years and welcomed the takeover of the U.S. Congress and the Presidency in the 1990s and early 2000s were deceived. Soon they will realize that the goal of limited government has been dashed and that their views no longer matter. The so-called conservative revolution of the past 2 decades has given us massive growth in government size, spending and regulations. Deficits are exploding and the national debt is now rising at greater than a half trillion dollars per year. Taxes do not go down, even if we vote to lower them. They cannot, as long as spending is increased, since all spending must be paid for one way or another. Both Presidents Reagan and the elder George Bush raised taxes directly. With this administration so far, direct taxes have been reduced, and they certainly should have been. But it means little if spending increases and deficits rise. When taxes are not raised to accommodate higher spending, the bills must be paid for by either borrowing or printing new money. This is one reason why we conveniently have a generous Federal Reserve chairman who is willing to accommodate the Congress with borrowing and inflating the taxes delayed and distributed in a way that makes it difficult for those paying the tax to identify it. Like future generations and those on fixed incomes who suffer from rising prices, and those who lose jobs, they certainly feel the consequence of economic dislocation this process causes. Government spending is always a tax burden on the American people and is never equally or fairly distributed. The poor and low middle-income workers always suffer the most from the deceitful tax of inflation and borrowing. Many present-day conservatives who generally argue for less government and supported the Reagan-Gingrich-Bush takeover of the Federal Government are now justifiably disillusioned. Although not a monolithic group, they wanted to shrink the size of government. Early in our history, the advocates of limited constitutional government recognized two important principles: the rule of law was crucial, and a constitutional government must derive just powers from the consent of the governed. It was understood that an explicit transfer of power to government could only occur with power rightfully and naturally endowed to each individual as a God-given right. Therefore, the powers that could be transferred would be limited to the purpose of protecting liberty. Unfortunately, in the last 100 years, the defense of liberty has been fragmented and shared by various groups with some protecting civil liberties, others economic freedom, and a small diverse group arguing for a foreign policy of nonintervention. The philosophy of freedom has had a tough go of it, and it was hoped that the renewed interest in limited government of the past 2 decades would revive an interest in reconstituting the freedom philosophy into something more consistent. Those who worked for the goal of limited government power believed the rhetoric of politicians who promised smaller government. Sometimes it was just plain sloppy thinking on their part, but at other times they fell victim to a deliberate distortion of a concise limited government philosophy by politicians who misled many into believing that we would see a rollback on government intrusiveness. Yes, there was always a remnant who longed for truly limited government and maintained a belief in the rule of law combined with a deep conviction that free people and a government bound by a constitution were the most advantageous form of government. They recognized it as the only practical way for prosperity to be spread to the maximum number of people while promoting peace and security. That remnant, imperfect as it may have been, was heard from in the elections of 1980, 1994, and then achieved major victories in 2000 and 2002 when professed limited government proponents took over the administration, Senate and the House. However the true believers of limited government are now shunned and laughed at. At the very least, they are ignored except when they are used by the new leaders of the right, the new conservatives now in charge of the U.S. Government. The remnant's instincts were correct, and the politicians placated them with talk of free markets, limited government, and a humble non- nation-building foreign policy. However, little concern for civil liberties was expressed in this recent quest for less government. Yet for an ultimate victory of achieving freedom, this must change. Interest in personal privacy and choices has generally remained outside the concern of many conservatives, especially with the great harm done by their long-time support of the drug war. Even though some confusion has emerged over our foreign policy since the breakdown of the Soviet Union, it has been a net benefit in getting some conservatives back on track with a less militaristic interventionist foreign policy. Unfortunately, though, after 9/11 the cause of liberty suffered a setback. As a result, millions of Americans voted for the less than perfect conservative revolution because they believed in the promises of the politicians. Now there is mounting evidence to indicate exactly what happened to the revolution. Government is bigger than ever, and future commitments are overwhelming. Millions will soon become disenchanted with the new status quo delivered to the American people by the advocates of limited government and will find it to be just more of the old status quo. Victories for limited government have turned out to be hollow indeed. Since the national debt is increasing at a rate greater than a half trillion per year, the debt limit was recently increased by an astounding $984 billion. Total U.S. Government obligations are $43 billion, while total net worth of all U.S. households is just over $44 trillion. The country is broke, but no one in Washington seems to notice or care. The philosophic and political commitment for both guns and butter, and especially the expanding American empire, must be challenged. This is crucial for our survival. In spite of the floundering economy, the Congress and the administration continues to take on new commitments in foreign aid, education, farming, medicine, multiple efforts at nation-building and preemptive wars around the world. Already we are entrenched in Iraq and Afghanistan with plans to add new trophies to our conquests. War talk abounds as to when Syria, Iran, and North Korea may be attacked. How did this all transpire? Why did the government do it? Why have the people not objected? How long will it go on before something is done? Does anyone care? Will the euphoria of grand military victories against nonenemies ever be mellowed? Someday we as a legislative body must face the reality about the dire situation in which we have allowed ourselves to become enmeshed. Hopefully it will be soon. We got here because ideas do have consequences. Bad ideas have bad consequences. Even the best of intentions have unintended consequences. We need to know exactly what the philosophic ideas were that drove us to this point; then hopefully reject them and decide on another set of intellectual parameters. There is abundant evidence exposing those who drive our foreign policy justifying preemptive war. Those who scheme are proud of their achievements in usurping control over foreign policy. These are the neoconservatives of recent fame. Granted, they are talented and achieved a political victory that all policymakers must admire, but can freedom and the Republic survive this takeover? That question should concern us. Neoconservatives are obviously in positions of influence and are well placed throughout our government and the media. An apathetic Congress put up little resistance and abdicated its responsibility over foreign affairs. The electorate was easily influenced to join in the patriotic fervor supporting the military adventurism advocated by the neoconservatives. The numbers of those who still hope for truly limited government diminished and had their concerns ignored during these past 22 months during the aftermath of 9/11. Members of Congress were easily influenced to publicly support any domestic policy or foreign military venture that was supposed to help reduce the threat of a terrorist attack. Believers in limited government were harder to find. Political money, as usual, played a role in pressing Congress into supporting almost any proposal suggested by the neoconservatives. This process, where campaign dollars and lobbying efforts affect policy, is hardly the domain of any single party; and, unfortunately, is the way of life in Washington. There are many reasons why government continues to grow. It would be naive for anyone to expect otherwise. Since 9/11, protection of privacy, whether medical, personal or financial, has vanished. Free speech and the fourth amendment have been under constant attack. Higher welfare expenditures are endorsed by the leadership of both parties. Policing the world and nation-building issues are popular campaign targets, yet they are now standard operating procedures here in Washington. There is no sign that these programs will be slowed or reversed until either we are stopped by force overseas, which will not be soon, or we go broke and can no longer afford these grandiose plans for a world empire, which will probably come sooner than later. None of this happened by accident or coincidence. Precise philosophic ideas prompted certain individuals to gain influence to implement these plans. The neoconservatives, a name they gave themselves, diligently worked their way into positions of power and influence. They documented their goals, strategy and moral justification for all they hoped to accomplish. Above all else, they were not and are not conservatives dedicated to limited constitutional government. Neoconservatism has been around for decades and strangely has connections to past generations as far back as Machiavelli. Modern-day neoconservatism was introduced to us in the 1960s. It entails both a detailed strategy as well as a philosophy of government. The ideas of Teddy Roosevelt and certainly Woodrow Wilson were quite similar to many of the views of the present-day neocons. Neocon spokesman Max Boot brags that what he advocates is ``hard Wilsonianism.'' In many ways there is nothing neo about their views, and certainly nothing is conservative. Yet they have been able to co-opt the conservative movement by advertising themselves as a new or modern form of conservatism. More recently, the modern-day neocons have come from the far left, a group historically identified as former Trotskyists. Liberal Christopher Hitchins has just recently joined the neocons. It has been reported that he has already been to the White House as an ad hoc consultant. Many neocons now in position of influence in Washington can trace their status back to Professor Leo Strauss of the University of Chicago. One of Strauss' books was ``Thoughts on Machiavelli.'' This book was not a condemnation of Machiavelli's philosophy. Paul Wolfowitz got his Ph.D. under Strauss. Others closely associated with these views are Richard Perle, Eliot Abrams, Robert Kagan, and William Kristol. All are key players in designing our new strategy of preemptive war. Others include Michael Ledeen of the American Enterprise Institute, former CIA Director James Woolsey, Bill Bennett of ``Book of Virtue'' fame, Frank Gaffney, Dick Cheney and Donald Rumsfeld. There are just too many to mention who are philosophically or politically connected to the neocon philosophy in some varying degree. The godfather of modern-day neoconservatism is considered to be Irving Kristol, father of Bill Kristol, who set the stage in 1983 with his publication ``Reflections of a Neoconservative.'' In this book Kristol also defends the traditional liberal position on welfare. More important than the names of people affiliated with neoconservative are the views they adhere to. Here is a brief summary of the general understanding of what neocons believe. They agree with Trotsky on permanent revolution, violent as well as intellectual. They are for redrawing the map of the Middle East, and are willing to use force to do it. They believe in preemptive war to achieve desired ends. They accept the notion that the ends justify the means, that hard-ball politics is a moral necessity. They express no opposition to the welfare state. They are not bashful about an American empire; instead, they strongly endorse it. They believe lying is necessary for the state to survive. They believe a powerful Federal Government is a benefit. They believe pertinent facts of how a society should be run should be held by the elite and withheld from those who do not have the courage to deal with it. They believe neutrality in foreign affairs is ill- advised. They hold Leo Strauss in high esteem. They believe imperialism, if progressive in nature, is appropriate. Using American might to force American ideas on others is acceptable, force should not be limited to the defense of our country, and 9/11 resulted from the lack of foreign entanglements, not from too many. They dislike and despise libertarians. Therefore, the same applies to all strict Constitutionalists. They endorse a tax on civil liberties such as those found in the PATRIOT Act as being necessary. They unconditionally support Israel and have a close alliance with the Likud Party. Various organizations and publications of the past 30 years have played a significant role in the rise to power of the neoconservatives. It took plenty of money and commitment to produce the intellectual arguments needed to convince the many participants in the movement of its respectability. It is no secret, especially after the rash of research and articles written about the neocons since our invasion of Iraq, how they gained influence and what organizations were used to promote their cause. Although for decades they agitated for their beliefs through publications like The National Review, Weekly Standard, The Public Interest, The Wall Street Journal, Commentary and The New York Post, their views only gained momentum in the 1990s following the first Persian Gulf War, which still has not ended. They became convinced that a much more militant approach to resolving all of the conflicts of the Middle East was an absolute necessity, and they were determined to implement that policy. In addition to publications, multiple think tanks and projects were created to promote their agenda. A product of the Bradley Foundation, the American Enterprise Institute led the neocon charge, but the real push for war came from the project for a New American Century, another organization helped by the Bradley Foundation. This occurred in 1998 and was chaired by Weekly Standard editor Bill Kristol. They urged early on for war against the Iraq, but were disappointed with the Clinton administration, which never followed through with its periodic bombings. Obviously, those bombings were motivated more by Clinton's personal and political problems than a belief in the neocon agenda. The election of 2000 changed all that. The Defense Policy Board, chaired by Richard Perle, played no small role in coordinating the various projects and think tanks, all determined to take us to war against Iraq. It was not too long before the dream of empire was brought closer to reality by the election of 2000, with Paul Wolfowitz, Richard Cheney and Donald Rumsfeld playing key roles in this accomplishment. The plan to promote an American greatness imperialistic foreign policy was now a distinct possibility. Iraq offered a great opportunity to prove their long-held theories. This opportunity was a consequence of the 9/11 disaster. The money and views of Rupert Murdock also played a key role in promoting the neocon views, as well as rallying support by the general population, through his News Corporation, which owns Fox News Network, the New York Post and Weekly Standard. This powerful and influential media empire did more to galvanize public support for the Iraqi invasion than one might imagine. This facilitated the Rumsfeld/Cheney policy as their plans to attack Iraq came to fruition. It would have been difficult for the neocons to usurp foreign policy from the restraints of Colin Powell's State Department without the successful agitation of the Rupert Murdock empire. Max Boot was satisfied as he explained: ``Neoconservatives believe in using American might to promote American ideals abroad.'' This attitude is a far cry from the advice of the Founders who advocated no entangling alliances and neutrality as the proper goal of American foreign policy. Let there be no doubt. Those in the neocon camp had been anxious to go to war against Iraq for a decade. They justified the use of force to accomplish their goals, even if it required preemptive war. If anyone doubts this assertion, they need only read of their strategy in ``A Clean Break: a New Strategy For Securing the Realm.'' Although they felt morally justified in changing the government in Iraq, they knew that public support was important and justification had to be given to pursue the war. Of course, a threat to us had to exist before the people and the Congress would go along with war. The majority of Americans became convinced of this threat, which in actuality never really existed. Now we have the ongoing debate over the location of weapons of mass destruction. Where was the danger? Was all this killing and spending necessary? How long will this nation-building and dying go on? When will we become more concerned about the needs of our own citizens than the problems we sought in Iraq and Afghanistan? Who knows where we will go next? Iran, Syria, North Korea. At the end of the Cold War, the neoconservatives realized a rearrangement of the world was occurring in that our superior economic and military power offered them a perfect opportunity to control the process of remaking the Middle East. It was recognized that a new era was upon us and the neocons welcomed Frances Fukuyama's ``end of history'' declaration. To them the debate was over. The West won; the Soviets lost. Old-fashioned communism was dead. Long live the new era of neoconservatism. The struggle may not be over, but the West won the intellectual fight, they reasoned. The only problem is that the neocons decided to define the philosophy of the victors. They had been amazingly successful in their efforts to control the debate over what Western values are and by what methods they will be spread throughout the world. Communism surely lost a lot with the breakup of the Soviet Empire, but this can hardly be declared a victory for American liberty as the Founders understood it. neoconservatism is not the philosophy of free markets and a wise foreign policy. Instead, it represents big- government welfare at home and a program of using our military might to spread their version of American values throughout the world. Since neoconservatives dominate the way the U.S. Government now operates, it behooves us all to understand their beliefs and goals. The breakup of the Soviet system may well have been an epic event, but to say that the views of the neocons are the unchallenged victors in that all we need do is to wait for their implementation is a capitulation to the controlling of the forces of history that many Americans are not yet ready to concede. There is surely no need to do so. There is now a recognized philosophic connection between modern-day neoconservatives and Irving Kristol, Leo Strauss and Machiavelli. This is important in understanding that today's policies and the subsequent problems will be with us for years to come if these policies are not reversed. Not only did Leo Strauss write favorably of Machiavelli, Michael Ledeen, a current leader of the neoconservative movement, did the same in 1999 in his book with the title ``Machiavelli on Modern Leadership, Why Machiavelli's iron rules are as timely and important today as five centuries ago.'' Ledeen is indeed an influential neocon theorist whose views get a lot of attention today in Washington. His book on Machiavelli, interestingly enough, was passed out to Members of Congress attending a political strategy meeting shortly after its publication and at just about the same time ``A Clean Break'' was issued. In Ledeen's most recent publication, ``The War Against the Terror Masters,'' he reiterates his beliefs he outlined in 1999. He specifically praises: ``Creative destruction . . . both within our own society and abroad . . . (foreigners) seeing America undo traditional societies may fear us, for they do not wish to be undone.'' Amazingly, Ledeen continues: ``They must attack us in order to survive, just as we must destroy them to advance our historic mission.'' If those words do not scare us, nothing will. If they are not a clear warning, I do not know what could be. It sounds like both sides of each disagreement in the world will be following the principles of preemptive war. The world is certainly a less safe place for it. In ``Machiavelli on Modern Leadership,'' Ledeen praises a business leader for correctly understanding Machiavelli: ``There are no absolute solutions. It all depends. What is right and what is wrong depends on what needs to be done and how.'' This is a clear endorsement of situation ethics and is not coming from the traditional left. It reminds me of ``it depends on what the definition of the word `is' is.'' Ledeen quotes Machiavelli approvingly on what makes a great leader: ``A prince must have no other objectives or other thoughts or take anything for his craft except war.'' To Ledeen this meant ``. . . the virtues of the warriors are those of great leaders of any successful organization.'' It is obvious that war is not coincidental to neocon philosophy but an integral part. The intellectuals justify it and the politicians carry it out. There is a precise reason to argue for war over peace according to Ledeen, for ``. . . peace increases our peril by making discipline less urgent, encouraging some of our worst instincts, in depriving us of some of our best leaders.'' Peace, he claims, is a dream and not even a pleasant one for it would cause indolence and would undermine the power of the state. Although I concede the history of the world is a history of frequent war, to capitulate and give up even striving for peace, believing peace is not a benefit to mankind, is a frightening thought that condemns the world to perpetual war and justifies it as a benefit and necessity. These are dangerous ideas from which no good can come. The conflict of the ages has been between the state and the individual: central power versus liberty. The more restrained the state and the more emphasis on individual liberty, the greater has been the advancement of civilization and general prosperity. Just as man's condition was not locked in place by the times and wars of old and improved with liberty and free markets, there is no reason to believe a new stage for man might not be achieved by believing and working for conditions of peace. The inevitability and so-called need for preemptive war should never be intellectually justified as being a benefit. Such an attitude guarantees the backsliding of civilization. Neocons, unfortunately, claim that war is in man's nature and that we cannot do much about it; so let us use it to our advantage by promoting our goodness around the world through force of arms. That view is anathema to the cause of liberty and the preservation of the Constitution. If it is not loudly refuted, our future will be dire, indeed. Ledeen believes man is basically evil and cannot be left to his own desires. Therefore, he must have proper and strong leadership, just as Machiavelli argued. Only then can man achieve good, as Ledeen explains: ``In order to achieve the most noble accomplishment, the leader may have to `enter into evil.' '' This is the chilling insight that has made Machiavelli so feared, admired, and challenging. ``. . . we are rotten. It's true that we can achieve greatness if, and only if, we are properly led.'' In other words, man is so depraved that individuals are incapable of moral, ethical, and spiritual greatness, and achieving excellence and virtue can only come from a powerful authoritarian leader. What depraved ideas are these to now be influencing our leaders in Washington? The question Ledeen does not answer is: ``Why do the political leaders not suffer from the same shortcomings and where do they obtain their monopoly on wisdom?'' Once this trust is placed in the hands of a powerful leader, this neocon argues that certain tools are permissible to use. For instance, this is what Ledeen says: ``Lying is central to the survival of nations and to success of great enterprises because if our enemies can count on the reliability of everything you say, your vulnerability is enormously increased.'' What about the effects of lying on one's own people? Who cares if a leader can fool the enemy? Does calling it ``strategic deception'' make lying morally justifiable? Ledeen and Machiavelli argue that it does, as long as the survivability of the state is at stake. Preserving the state is their goal, even if personal liberty of all individuals has to be suspended or canceled. Ledeen makes it clear that war is necessary to establish national boundaries because that is the way it has always been done. Who needs progress of the human race? He explains: ``Look at the map of the world: national boundaries have not been drawn by peaceful men leading lives of spiritual contemplation. National boundaries have been established by war, and national character has been shaped by struggle, most often bloody struggle.'' Yes, but who is to lead the charge and decide which borders we are to fight for? What about the borders 6,000 miles away unrelated to our own contiguous borders and our own national security? Stating a relative truism regarding the frequency of war throughout history should hardly be the moral justification for expanding the concept of war to settle man's disputes. How can one call this progress? Machiavelli, Ledeen, and the neocons recognize a need to generate a religious zeal for promoting the state. This, he claims, is especially necessary when force is used to promote an agenda. It has been true throughout history and remains true today, each side of major conflicts invokes God's approval. Our side refers to a ``crusade,'' theirs to a ``holy Jihad.'' Too many wars boil down to their God versus our God. It seems this principle is more a cynical effort to gain approval from the masses, especially those most likely to be killed for the sake of the war promoters on both sides who have power, prestige, and wealth at stake. Ledeen explains why God must always be on the side of the advocates of war: ``Without fear of God, no state can last long, for the dread of eternal damnation keeps men in line, causes them to honor their promises, and inspires them to risk their lives for the common good.'' It seems dying for the common good has gained a higher moral status than eternal salvation of one's soul. He goes on to say: ``Without fear of punishment, men will not obey laws that force them to act contrary to their passions. Without fear of arms, the state cannot enforce the laws . . . to this end, Machiavelli wants leaders to make the state spectacular.'' It is of interest to note that some large Christian denominations have joined the neoconservatives in promoting preemptive war, while completely ignoring the Christian doctrine of a Just War. The neocons sought and openly welcomed their support. I would like someone to glean anything from what the Founders said or placed in the Constitution that agrees with this now-professed doctrine of a ``spectacular'' state promoted by those who now have so much influence on our policies here at home and abroad. Ledeen argues that this religious element, this fear of God is needed for discipline of those who may be hesitant to sacrifice their lives for the good of the ``spectacular state.'' He explains in eerie terms: ``Dying for one's country doesn't come naturally. Modern armies, raised from the populace, must be inspired, motivated, indoctrinated. Religion is central to the military enterprise, for men are more likely to risk their lives if they believe they will be rewarded forever after for serving their country.'' This is an admonition that might just as well been given by Osama bin Laden in rallying his troops to sacrifice their lives to kill the invading infidels, as by our intellectuals at AEI, who greatly influence our foreign policy. Neocons, anxious for the U.S. to use force to realign the boundaries and change regimes in the Middle East, clearly understand the benefit of a galvanizing and emotional event to rally the people to their cause. Without a special event, they realize the difficulty in selling their policies of preemptive war where our own military personnel would be killed. Whether it was the Lusitania, Pearl Harbor, the Gulf of Tonkin or the Maine, all served their purpose in promoting a war that was sought by our leaders. Ledeen writes of a fortuitous event. He wrote this in 1999. He says, ``Of course, we can always get lucky. Stunning events from outside can providentially awaken the enterprise from its growing torpor and demonstrate the need for reversal, as the devastating Japanese attack on Pearl Harbor so effectively aroused the U.S. from its soothing dreams of permanent neutrality.'' Amazingly, Ledeen is here calling Pearl Harbor a ``lucky'' event. The Project for a New American Century, as recently as September 2000, likewise foresaw the need for ``a Pearl Harbor event'' that would galvanize the American people to support their ambitious plans to ensure political and economic domination of the world while strangling any potential rival. Recognizing a need for a Pearl Harbor event and referring to Pearl Harbor as being lucky are not identical to support and knowledge of such an event, but this sympathy for a galvanizing event, as 9/11 turned out to be, was used to promote an agenda that strict constitutionalists and devotees of the Founders of this Nation find appalling is indeed disturbing. After 9/11, Rumsfeld and others argued for an immediate attack on Iraq, even though it was not implicated in the 9/11 attacks. The fact that neoconservatives ridicule those who firmly believe that U.S. interests and world peace would be best served by a policy of neutrality and avoiding foreign entanglements should not go unchallenged. Not to do so is to condone their grandiose plans for an American world hegemony. The current attention given neocons is usually done in the context of foreign policy, but there is more to what is going on today than just the tremendous influence the neocons have on our new policy of preemptive war with a goal of empire. Our government is now being moved by several ideas that come together in what I call ``neoconism.'' The foreign policy is being openly debated, even if its implications are not fully understood by many who support it. Washington is now driven by old views brought together in a new package. We know those who lead us, both in the administration and in the Congress, show no appetite to challenge the tax or monetary systems that do so much damage to our economy. The IRS and the Federal Reserve are off limits for criticism or reform. There is no resistance to spending, either domestic or foreign. Debt is not seen as a problem. The supply-siders won on this issue, and now many conservatives readily endorse deficit spending. There is no serious opposition to expanding the welfare state, with rapid growth of the education, agriculture and medical care bureaucracies. Support for labor unions and protectionism are not uncommon. Civil liberties are easily sacrificed in the post-9/11 atmosphere prevailing in Washington. Privacy issues are of little concern, except for a few Members of Congress. Foreign aid and internationalism, in spite of some healthy criticism of the U.N. and growing concerns for our national sovereignty, are championed on both sides of the aisle. Lip service is given to the free market and free trade, yet the entire economy is run by special interest legislation favoring big business, big labor and, especially, big money. Instead of the ``end of history,'' we are now experiencing the end of a vocal, limited-government movement in our Nation's capital. While most conservatives no longer defend balanced budgets and reduced spending, most liberals have grown lazy in defending civil liberties and are now approving wars that we initiate. The so-called ``third way'' has arrived, and, sadly, it has taken the worst of what the conservatives and the liberals have to offer. The people are less well off for it, while liberty languishes as a result. Neocons enthusiastically embrace the Department of Education and national testing. Both parties overwhelmingly support the huge commitment to a new prescription drug program. Their devotion to the new approach called ``compassionate conservatism'' has lured many conservatives into supporting programs for expanding the Federal role for welfare and church charities. The faith-based initiative is a neocon project, yet it only repackages and expands the liberal notion of welfare. The intellectuals who promoted these initiatives were neocons, but there is nothing conservative about expanding the Federal Government's role in welfare. The supply-siders' policy of low marginal tax rates has been incorporated into neoconism, as well as their support for easy money and generous monetary inflation. Neoconservatives are disinterested in the gold standard and even ignore the supply-siders' argument for a phoney gold standard. Is it any wonder that Federal Government spending is growing at a rate faster than in any time in the past 35 years? Power, politics and privilege prevail over the rule of law, liberty, justice and peace, but it does not need to be that way. Neoconism has brought together many old ideas about how government should rule the people. It may have modernized its appeal in packaging, but authoritarian rule is authoritarian rule, regardless of the humanitarian overtones. A solution can only come after the current ideology driving our government and policies is replaced with a more positive one. In a historical context, liberty is a modern idea and must once again regain the high moral ground for civilization to advance. Restating the old justifications for war, people control and a benevolent state cannot suffice. It cannot eliminate the shortcomings that always occur when the state assumes authority over others and when the will of one nation is forced on another, whether or not it is done with good intentions. I realize that all conservatives are not neoconservatives, and all neocons do not necessarily agree on all points, which means that in spite of their tremendous influence, most Members of Congress and those in the administration do not necessarily take their marching orders from the AEI or Richard Perle. But to use this as a reason to ignore what neoconservative leaders believe, write about and agitate for with amazing success, I might point out, would be at our own peril. This country still allows open discourse, though less every day, and we who disagree should push the discussion and expose those who drive our policies. It is getting more difficult to get fair and balanced discussion on the issues because it has become routine for the hegemons to label those who object to preemptive war and domestic surveillance as traitors, unpatriotic, and un-American. The uniformity of support for our current foreign policy by major and cable news networks should concern every American. We should all be thankful for C-SPAN and the Internet. Michael Ledeen and other neoconservatives are already lobbying for war against Iran. Ledeen is pretty nasty to those who call for a calmer, reasoned approach by calling those who are not ready for war cowards and appeasers of tyrants. Because some urge a less militaristic approach to dealing with Iran, he claims they are betraying America's best traditions. I wonder where he learned American history. It is obvious that Ledeen does not consider the Founders and the Constitution part of our best traditions. We were hardly encouraged by the American revolutionaries to pursue an American empire. We were, however, urged to keep the Republic that they so painstakingly designed. If the neoconservatives retain control of the conservative, limited- growth movement in Washington, the ideas once championed by the conservatives of limiting the size and scope of government will be a long-forgotten dream. The believers in liberty ought not deceive themselves. Who should be satisfied? Certainly not conservatives, for there is no conservative movement left. How about liberals? Should they be satisfied? They are pleased with the centralization of education and medical programs in Washington and support many of the administration's proposals, but none of the liberals should be pleased with the steady attack on civil liberties of all American citizens and the now-accepted consensus that preemptive war for almost any reason is an acceptable policy for dealing with all the conflicts and problems of the world. In spite of the deteriorating conditions in Washington, with loss of personal liberty, a weak economy, exploding deficits and perpetual war, followed by nation-building, there are still quite a number of us who would relish the opportunity to improve things in one way or another. Certainly a growing number of frustrated Americans from both the right and the left are getting anxious to see this Congress do a better job. But first Congress must stop doing a bad job. We are at a point where we need a call to arms, both here in Washington and across the country. I am not talking about firearms. Those of us who care need to raise our arms and face our palms out and begin waving and shouting, ``Stop. Let us stop this. Enough is enough.'' It should include liberals, conservatives and independents. We are all getting a bum rap from the politicians who are pushed by the polls and controlled by special interest money. One thing is certain: No matter how morally justified programs and policies seem, the ability to finance all the guns and butter being promised is limited, and those limits are becoming more apparent every day. Spending, borrowing and printing money cannot be the road to prosperity. It has not worked in Japan, and it is not working here. As a matter of fact, it has never worked at the present time throughout history. A point is always reached where government planning, spending and inflation run out of steam. Instead of these old tools reviving an economy, as they do in the early stages of economic interventionism, they eventually become a problem. Both sides of the political spectrum must one day realize that limitless government intrusion in the economy, in our personal lives and the affairs of other nations cannot serve the best interests of America. This is not a conservative problem, nor is it a liberal problem, it is a government intrusion problem that comes from both groups, albeit for different reasons. The problems emanate from both camps who champion different programs for different reasons. The solution will come when both groups realize that is not merely a single-party problem, or just a liberal or just a conservative problem. Once enough of us decide we have had enough of all these so-called good things that the government is always promising, or, more likely, when the country is broke and the government is unable to fulfill its promises to its people, we can start a serious discussion on the proper role of government in a free society. Unfortunately, it will be some time before Congress gets this message that the people are demanding true reform. This requires that those responsible for today's problems are exposed and their philosophy of pervasive government intrusion is rejected. Let it not be said that no one cared, that no one objected once it is realized that our liberties and wealth are in jeopardy. A few have, and others will continue to do so, but too many, both in and out of government, close their eyes to the issue of personal liberty and ignore the fact that endless borrowing to finance endless demands cannot be sustained. True prosperity can only come from a healthy economy and sound money. That can only be achieved in a free society.