The End of Dollar Hegemony

Ron Paul makes a very powerful case. America seems strong. But it depends on oil thats running out, and other people's sweat which they are increasingly reluctant to give. I dont believe Americans can mend their ways. I give pax Americana no more than 30 years.

I hope you get some more comments on this solve. Its worth a good discussion. Problem is I think far too few Americans have any clue as to what Ron Paul is talking about...

that should provoke something

Silence the War Drums
Dear Steve (as 41oo)

Yep Ron Paul rocks!!! More genius of him...

best wishes from Switzerland

lwwb
Roger

Silence the War Drums

by Ron Paul


Before the US House of Representatives, February 16, 2006

Mr. Speaker, I rise in strong opposition to this very dangerous legislation. My colleagues would do well to understand that this legislation is leading us toward war against Iran.

Those reading this bill may find themselves feeling a sense of déjà vu. In many cases one can just substitute "Iraq" for "Iran" in this bill and we could be back in the pre-2003 run up to war with Iraq. And the logic of this current push for war is much the same as was the logic used in the argument for war on Iraq. As earlier with Iraq, this resolution demands that Iran perform the impossible task of proving a negative - in this case that Iran does not have plans to build a nuclear weapon.

There are a few things we need to remember when thinking about Iran and this legislation. First, Iran has never been ruled in violation of its international nuclear non-proliferation obligations.

Second, Iran concluded a Safeguards Agreement more than 30 years ago that provides for the verification of Iran's fulfillment of its obligation to not divert nuclear energy programs to nuclear weapons development. Since this agreement was reached, the International Atomic Energy Agency has never found any indication that Iran has diverted or attempted to divert source or special nuclear materials from a peaceful purpose to a military purpose.

But, this does not stop those eager for conflict with Iran from stating otherwise. As the Washington Post reported last year, "U.S. officials, eager to move the Iran issue to the U.N. Security Council - which has the authority to impose sanctions - have begun a new round of briefings for allies designed to convince them that Iran's real intention is to use its energy program as a cover for bomb building. The briefings will focus on the White House's belief that a country with as much oil as Iran would not need an energy program on the scale it is planning, according to two officials."

This reminds us of the quick move to justify the invasion of Iraq by citing Iraq's "intentions" when actual weapons of mass destruction could not be found.

The resolution's second resolved clause is a real misrepresentation of the Iran/EU3 talks. The "efforts of France, Germany, and the United Kingdom" were not "to seek...suspension of enrichment and reprocessing related activities..." As the EU3-Iran Paris Agreement makes very clear, the suspension of enrichment is a purely voluntary measure taken by Iran and is "not a legal obligation."

This is similar to the situation with Iran's voluntarily observation of the Additional Protocols (allowing unannounced inspections) without legally being bound to do so. Suspending voluntary observance of the Additional Protocols is not a violation of the NPT. But, those seeking to push us toward war with Iran are purposely trying to connect the two - to confuse voluntary "confidence building" measures taken by Iran with the legally-binding Treaty itself.

Resolved clause four of this legislation is the most inflammatory and objectionable part of the legislation. It lowers the bar to initiating war on Iran. This clause anticipates that the US may not be successful in getting the Security Council to pass a Resolution because of the potential of a Russian or Chinese veto, so it "calls upon" Russia and China to "take action" in response to "any report" of "Iran's noncompliance. That is right: any report.

Mr. Speaker, this resolution is a drumbeat for war with Iran. Its logic is faulty, its premises are flawed, and its conclusions are dangerous. I urge my colleagues to stop for a moment and ponder the wisdom of starting yet another war in the Middle East.
February 20, 2006

Dr. Ron Paul is a Republican member of Congress from Texas.

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The problem is that most Americans precisely have no working idea of economics, fiat money, currencies, central banking, trade deficits, much less debt, the latter being what most Americans suffer from the most.

Since 1987 America has been a debtor nation, a pale shadow of its former creditor nation status. Most Americans are too busy arguing over meaningless things such as intelligent design or evolution, or other diversions such as why Cheney took so long to come forth about his shooting. Who cares?

It remains that the bulk of the dollar assets are held by Asian countries (China and Japan I'm looking in your direction). It is these countries that are subsidizing America's debt. Now every once in a while you get these Keynesian economists, or political hacks who make a living by being government mouthpieces that spout the nonsense that somehow debt is actually good.

I don't know about anyone, but you don't have to be an economist to realize when youre in the negative zone. I learned that from my father, a hard working blue collar man himself who realized that debt is always a bad thing. It means you aren't doing something right.

Debt is plaguing all of American society, from the government, to the individual Americans. I remember an American who had lived in China for years and later moved to America. He was surprised when his son asked him what an APR is.

What is the government answer to an already overrated and overvalued dollar? Print more! Printing press Bernanke isn't going to do much different than Alan Greenspan. Gold is at an all time high compared to the dollar. Most people don't wonder, don't care. Stop and ask, why?

Costs from military escapades such as the Iraq and Afghanistan fiasco are mounting, debt is growing, and American production isn't meeting the demands. Moreover, competition is rising globally with China and India offering a challenge. Instead of actually competing and working what do Americans do? They cower and run behind the curtain of protectionism.

Many things have changed in this country, and while change is an inevitability one must ask oneself, is it for the good or the bad?

bm

Thanks Solve and greetings from London.

It seems to me the American Empire is going the way of many Empires before it...expansion abroad (not necessarily territorially but economically) financing profligacy at home. The American govt. is the only legal printer of dollars. The dollar is linked to the life blood of all modern "developed" economies, i.e. oil, and and if the world objects the US has a global military with which to change minds.

Yes, in effect the government (which is itself a monopoly - of force) also has a monopoly of issuing money, in this case, the United States dollar, via the Federal Reserve. The mechanics behind the Federal Reserve are what we call fractional reserve banking, which if anyone knows how it operates, is essentially nothing more than a fraudulent scheme of deception.

A good point you made, the American government is the sole printer of dollars. The value of the dollar in other words is simply based on faith. Faith by the American citizens in it's government, and faith by the world in the dollar. There is no hard commodity that backs the dollar like it used to be, i.e. gold.

Since the strength of the dollar is based on faith in the U.S. government, which is reinforced militarily, the strength of that dollar will depend on Americas ability to maintain its dominance and successes in its imperial escapades battling phantom enemies such as 'terrorism'. Anyone familiar with history knows this to be a losing battle, everyone except chickenhawks in Washington and their neoconservative pets, diehard Bush supporters who may as well be known as keyboard warriors, since they love the war but refuse to fight.

Either way, the future doesn't bode too well for an Empire of Debt by Bill Bonner.