Rand Paul says to support the Audit the Fed bill on 1/12

Discussion in 'Politics, Religion, Social Issues' started by Dmunjal, Jan 10, 2016.

  1. Dmunjal macrumors 65816

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    #1
    http://time.com/4170969/sen-rand-paul-audit-the-fed/

    About time for Congress to move this forward. I doubt it will get past the Senate though which has already been bought by Wall Street. If you support Sanders and Warren in their bid to fight Wall Street, then this bill will limit the institution that enables them to do the damage they do.
     
  2. vrDrew macrumors 65816

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    #2
    Please explain to me, in two hundred words or less, why "auditing the Fed" will do anything to improve the lives of the American people.
     
  3. Technarchy macrumors 604

    Technarchy

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    #3
    The government serves the people, and it is our absolute right to know the extent of our monetary policies and the managerial workings of the feds appointed governors.

    This isn't even a partisan issue as far as I am concerned. Turning over the nations currency control to what is essentially a private organization with no accountability to the people is completely insane.
     
  4. vrDrew macrumors 65816

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    The Director of the Central Intelligence Agency works for the American people. Do we have an absolute right to know the details of his meetings? How about those of nuclear weapons scientists? The Joint Chiefs of Staff? Do we have an absolute right to detailed minutes of Supreme Court deliberations?

    Lets get this straight: The Federal Reserve gets audited every year by Deloitte Touche. It is probably one of the most stringent and detailed audits conducted on any financial institution.

    Rand Paul's nonsense is about trying to get Government control of a central banking institution that actually serves the American people best by being independent of Government (ie. partisan) control. There is a direct link between letting the Government control the central bank and inflation. Zimbabwe's central banking is Government controlled. The central banks of Switzerland and Germany are independent of Government meddling.

    Pick which model you think works best.
     
  5. Dmunjal thread starter macrumors 65816

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    I believe the Fed is responsible for the income inequality we see today and have seen for the last 40 years. Especially, since we left the gold standard in 1971 which allowed the Fed more freedom in its monetary policy.

    The mechanism used to enable this transformation is the way it creates money and credit and who gets access to it. The QE and ZIRP policies over the last seven years have intensified this effect.

    When the Fed prints money or keeps interest rates low, it enables the rich and well connected who get access to this money first to bid up asset prices like stocks, commodities, and real estate. This makes them more wealthy than those who do not own assets and more than they would be without this effect.

    The rise in assets drives up the cost for the poor and middle classes in terms of food, energy, and rent which makes them poorer than they would be without this effect.

    Driving up asset prices was the stated goal of the Fed to create a wealth effect that would trickle down to the masses.

    Obviously this, as we know, doesn't work.
     
  6. vrDrew macrumors 65816

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    The rise in income inequality is a result of many different factors; primarily it has to do with things like technology and globalization. But here in the US it has been most enabled by actions of the US Congress. The same people who want to take more control of the Federal Reserve.

    Congress has enabled the rise of income inequality by slashing top marginal tax rates and by all-but eliminating the Estate Tax. By enabling the destruction of organized labor as a factor in American business.

    Income inequality is a growing problem in American society. In a modern economy the tools to deal with such issues are fairly simple: raise taxes on the highest incomes; and spend the money raised on programs that benefit all of society, such as infrastructure; education; and healthcare.
     
  7. aaronvan Suspended

    aaronvan

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    Audit the Pentagon, too. It amazes me that some people believe auditing federal government departments is a crazy idea, as if the government is above it all.
     
  8. Dmunjal, Jan 12, 2016
    Last edited: Jan 12, 2016

    Dmunjal thread starter macrumors 65816

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    Tax revenues are as high as they have ever been. What will more revenue do but sustain the bureaucracy and more wars? Income inequality has gotten worse under Obama despite higher taxes.

    I do agree with globalization being a major cause. All of the postwar dynamics are working against us now.
     
  9. vrDrew macrumors 65816

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    Of course revenues are high: The United States economy is, in real terms, much, much bigger than it has ever been in the past.
    [​IMG]

    Look at this graph. In constant (ie. inflation-adjusted) dollars US GDP per capita almost doubled between 1980 (Ronald Reagan elected President) and 2011. But how many ordinary Americans feel "twice as rich" as they did back in Reagan's day? Answer: Very few.

    Almost all the economic gains, due to productivity increases, etc. - have gone to the very richest people in society. Thats a problem. But its not the fault of the Federal Reserve.

    You are kidding yourself if you think that lowering taxes will somehow magically result in companies paying their workers more. (Please explain how that would work...)

    "Audit the Fed" is a gimmick cooked up by populists (of both the left and right). But it does nothing to solve problems of inequality; budget deficits; Government spending; or infrastructure decay.

    That's Congress' business. The same band of chumps they want to hand control over our central banking system over to. Dumb idea.
     
  10. Eraserhead macrumors G4

    Eraserhead

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    #10
    The Fed is audited.
     
  11. Dmunjal thread starter macrumors 65816

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    #11
    Do you know which foreign banks received billions in loans in 2008? Are you OK with our tax payer money being used to support foreign private banks?
     
  12. Dmunjal thread starter macrumors 65816

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    #12
    We've had marginal tax rates from 25-90% but revenue as a percent of GDP is always in a tight range. There are diminishing returns to raising taxes.

    uploadfromtaptalk1452614527259.jpg

    But we can control the Fed and it's support of out of control debt. Debt is what makes income inequality happen. Debt makes rich people richer and poor people poorer. Taxes cannot fix that problem.
     
  13. Jess13, Jan 12, 2016
    Last edited: Jan 12, 2016

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    Jess13

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    #13
    The DCI works for Wall Street actually. CIA is Wall Street.

    Not billions-it was TRILLIONS.

    It passed the House with all Repubs and 100 Dems supporting. Let's see how real FeelTheBern|ie is today.
     
  14. Dmunjal thread starter macrumors 65816

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    #14
    Yes, it was trillions.

    What I want to ask liberals is why they support the Fed when trillions are spent on mostly banking activities. The Fed balance sheet went from under $1T in 2008 to over $4T today. All that was used to bail out the banks and is sitting at the big banks earning interest. Why shouldn't that money be available for other domestic causes? $4T could be used to shore up SS, Medicare, etc. Even our infrastructure needs could be met with only $1T. Raising taxes on the rich would only bring in billions when trillions have been wasted on banks.
     
  15. Eraserhead macrumors G4

    Eraserhead

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    #15
    Foreign banks with substantial numbers of US customers?
    --- Post Merged, Jan 12, 2016 ---
    Sure you could have avoided the bailout and the US financial system would have collapsed.

    Lehman isn't going to pay back for 20 years so I'm not sure how you'd have expected it to go down.
     
  16. Dmunjal thread starter macrumors 65816

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    Really? You believe that money went to the US customers?
     
  17. Eraserhead macrumors G4

    Eraserhead

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    #17
    If those banks had collapsed US customers of those banks would have lost all their money.
     
  18. Dmunjal thread starter macrumors 65816

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    #18
    FDIC takes care of American banks. Why should the Fed use US tax dollars to bail out foreign banks where there is no implied FDIC mechanism? That is for their central banks to figure out.

    Isn't this where liberals say the US shouldn't defend the world and each country should handle that themselves? Hypocrisy much?
     
  19. Eraserhead macrumors G4

    Eraserhead

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    #19
    Ok which specific foreign banks did the US bail out? And how much did it lose on those loans?
     
  20. Dmunjal thread starter macrumors 65816

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    #20
    http://www.sott.net/article/250592-...eserve-Reveals-16-Trillion-in-Secret-Bailouts

    You may disagree with the loans themselves. I don't think we should be doing that all.

    But are you OK with all of it being done in secret? This bill is about AUDITING what the Fed does. It doesn't change what they are able to do, unfortunately.
     
  21. Technarchy macrumors 604

    Technarchy

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    #21
    Read the GAO audit. Lots of information there with specific banks named.

    http://www.scribd.com/doc/60553686/GAO-Fed-Investigation#outer_page_144

     
  22. vrDrew macrumors 65816

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    #22


    There are also diminishing returns to cutting taxes. A 95% marginal tax on the highest incomes is too high. A 28% marginal rate is too low.

    The US economy grew fastest at a time when marginal personal income tax rates were more than 70%. Corporate taxes were much lower than that. So corporate executives and shareholders had an incentive to invest in their businesses - figuring that in the long run it was better to get rich slowly, and pay long-term capital gains taxes (which again were much lower than straight income taxes) when they cashed out. By investing in their businesses they created jobs; which drove up wages for ordinary Americans.

    Fast forward to today (or at least the late 1980s.) With top personal tax rates relatively low - ie. much closer to the rates on long term capital gains - there was no incentive for executives and shareholders to wait to get rich. Cash out now - in the form of massive salaries (often hundreds of times what ordinary workers made) and dividend payments that left little money for investment or job creation.

    Thats what Congress and its tax policies have done to exacerbate the problem of income inequality.

    Lastly, I'm not totally sure you understand what the Federal Reserve actually does. But one thing it doesn't do is loan money to foreign banks or corporations.
     
  23. Dmunjal thread starter macrumors 65816

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    #23
    I never said we should cut taxes. We're at 39.6% marginal rate now. Where should it be?

    Tax rates are where they were under Clinton. Actually higher because of the Obamacare tax. But the economy is much weaker than it was in the 90s. Kind of blows your theory right there.

    I think there is a stronger correlation with what the Fed is doing with monetary policy and how it affects the economy than with anything tax policy does. The Fed lowers interest rates or prints money (like they did in 1997 and 2002) and we get a boom (tech and housing, respectively). When they pull back like they did in 2001, 2008, and now in 2015, we get a bust.

    Nowhere in your link does it say the Fed can loan to foreign banks. But I do believe it is legal to do so if they have local branches in the US. Even if it is legal, I believe it should be audited. If anything because of the amount of dollars involved.
     
  24. Jess13 Suspended

    Jess13

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    #24
    How many hundreds of thousands of liberal dems lost their homes and savings because of Wall Street's crimes? How many of those same liberals do you think did not support Obama's re-election in 2012, considering it was Obama who presided over nearly the entirety of the Wall Street criminals' bailouts, while the people who he was elected by got ****ed over and lost everything? My bet: Most of them.

    But who cares if the Fed stole trillions from the people and indebted them for decades to come? Or that the Fed has been operating unaccountably-opaque? Real Americans care. Audit The Fed. Stand With Rand.
     
  25. vrDrew macrumors 65816

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    #25
    I'm sorry. But blaming the Federal Reserve for the 2008 financial crisis is just plain wrong. Its like blaming the highway patrol for a drunk-driving crash. That also involved an airplane (over which they have no jurisdiction.)

    I'm done trying to have a rational discussion with people who simply refuse to understand the very basics of how a central banking system (and specifically our Federal Reserve) works.

    Rand Paul is an ophthalmologist. Not a banker or an economist. He's also an imbecile.
     

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