Here Ron Paul says again some sane things (as he always does). Paul Krugman, a supporter of monetary policy and Keynesianism, says he has no problem to let the GDP deficit surge to 130% (now 100). Krugman thinks that too much austerity will kill any economy.
Well, I love Ron Paul. He stands for a smaller government, cutting government budget in his first year (I hope that someday people will see his measures would have helped the country more) by one trillion dollars. The whole debt is tipping 16 trillion now.Some quotes: “the real damage is being done are the politicians. Of all the presidential candidates I’m the only one suggesting cutting the budget with one trillion in its first year. The government knows that the FED will always buy the lender of last resort treasury bills and always keeps interest rates lower than the market. If politicians knew that interest rates would increase, they wouldn’t be able to go to war or dole out welfare. Politically it’s almost impossible for politicians not to have a central bank”.
The people still have appetite for wars, welfare and politicians love to wield power and influence. The FED is there to accommodate the government (elites).
Spain is going through tough times right now. Paul says you have to do it both ways, it is austerity and cutting welfare (socialistic) programs. It’s not easy, but you can’t have it any other way.