Financial Armageddon Mentioned in the New York Times

An article in this Sunday's New York Times Magazine, "The Antiwar, Anti-Abortion, Anti-Drug-Enforcement-Administration, Anti-Medicare Candidacy of Dr. Ron Paul," by Christopher Caldwell, notes one book the Republican candidate for president is currently reading.

Financial Armageddon

Paul grew up in the western Pennsylvania town of Green Tree. His father, the son of a German immigrant, ran a small dairy company. Sports were big around there — one of the customers on the milk route Paul worked as a teenager was the retired baseball Hall of Famer Honus Wagner — and Paul was a terrific athlete, winning a state track meet in the 220 and excelling at football and baseball. But knee injuries had ended his sports career by the time he went off to Gettysburg College in 1953. After medical school at Duke, Paul joined the Air Force, where he served as a flight surgeon, tending to the ear, nose and throat ailments of pilots, and traveling to Iran, Ethiopia and elsewhere. “I recall doing a lot of physicals on Army warrant officers who wanted to become helicopter pilots and go to Vietnam,” he told me. “They were gung-ho. I’ve often thought about how many of those people never came back.”

Paul is given to mulling things over morally. His family was pious and Lutheran; two of his brothers became ministers. Paul’s five children were baptized in the Episcopal church, but he now attends a Baptist one. He doesn’t travel alone with women and once dressed down an aide for using the expression “red-light district” in front of a female colleague. As a young man, though, he did not protest the Vietnam War, which he now calls “totally unnecessary” and “illegal.” Much later, after the United States invaded Iraq in 2003, he began reading St. Augustine. “I was annoyed by the evangelicals’ being so supportive of pre-emptive war, which seems to contradict everything that I was taught as a Christian,” he recalls. “The religion is based on somebody who’s referred to as the Prince of Peace.”

In 1968, Paul settled in southern Texas, where he had been stationed. He recalls that he was for a while the only obstetrician — “a very delightful part of medicine,” he says — in Brazoria County. He was already immersed in reading the economics books that would change his life. Americans know the “Austrian school,” if at all, from the work of Friedrich Hayek and Ludwig von Mises, two economists who fled the Nazis in the 1930s and whose free-market doctrines helped inspire the conservative movement in the 1950s. The laws of economics don’t admit exceptions, say the Austrians. You cannot fake out markets, no matter how surreptitiously you expand the money supply. Spend more than you earn, and you are on the road to inflation and tyranny.

Such views are not always Republican orthodoxy. Paul is a harsh critic of the Federal Reserve, both for its policies and its unaccountability. “We first bonded,” recalls Barney Frank, the Massachusetts Democrat, “because we were both conspicuous nonworshipers at the Temple of the Fed and of the High Priest Greenspan.” In recent weeks, Paul’s airport reading has been a book called “Financial Armageddon.” He is obsessed with sound money, which he considers — along with the related phenomena of credit excess, bubbles and uncollateralized assets of all kinds — a “sleeper issue.” The United States ought to link its currency to gold or silver again, Paul says. He puts his money where his mouth is. According to Federal Election Commission documents, most of his investments are in gold and silver and are worth between $1.5 and $3.5 million. It’s a modest sum by the standards of major presidential candidates but impressive for someone who put five children through college on a doctor’s (and later a congressman’s) earnings.

Click here to read the article. Click here to buy the book.

Comments

[Jack Stevison]

Michael:

Congratulations. Now if Ron Paul can only be electable, we'll stand a chance of not suffering the consequences outlined in your book.

[muckdog]

Ah, the wall of worry blog! Interesting reading. I like the questioning of the status quo. Good blog.

[Michael Panzner]

Thanks to the both of you!

[Sackerson]

Michael, I used to think you had a tendency to overstate the case, but now I'm really not so sure. We see this "wall of worry" tag, but I think it's a "slalom of insouciance". Something is definitely going on - for example, the UK has increased its holdings of US Treasury securities by 202% in 12 months, wheras the average increase has been only 10.37%. This is from the US Treasury's own figures dated 17 July. Please see my "Bearwatch" site at http://theylaughedatnoah.blogspot.com

[Yogi]

Congrats. I'm glad to see your book is getting some of the attention it deserves. Unfortunately it's probably too late to save the current financial system, but we'll need honest people like Ron Paul to clean up the wreckage.

[David]

Congratulations on the mention of your book, Michael. Very cool. I just came across it as I was reading the NY Times piece, and wanted to drop by to give you a thumbs up and say "great news".

Best,
David