Ron Paul On Gutting Fed Gov't: Vote For My Plan And Nobody Gets Hurt!

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Pardon my French, but what in the hell is Ron Paul talking about? Up until this time, I've sort of brushed off Ron Paul as consistent, but ultimately clueless (sorry, you Paul fans, but libertarianism does not and cannot work. It's not up for debate; it's a ridiculous mindset that glorifies selfishness and ignores that sometimes in life, things happen, and the measure of a society is how the least of us is cared for.) But listening to him tout his economic plan to David Gregory, I've had to conclude that he's more than clueless, he's outright delusional.

To the surprise of no one, Paul's economic plan involves cutting $1 trillion immediately, mostly by eliminating the Energy, Housing and Urban Development, Commerce, Interior and Education departments. Paul's plan would eliminate jobs for 200,000 federal employees, whom he deems "nonproductive". But never fear, Paul assures us that "nobody will be hurt":

GREGORY: Let’s get right to your plan. This week, you unveiled a plan to cut the deficit and deal with the economy. The key elements of it is that you want to cut $1 trillion of spending in the first year. To do that, you would eliminated five cabinet departments, Energy, Housing and Urban Development, Commerce, Interior and Education. On Monday in Las Vegas, you unveiled a plan and this is what you said about it.

PAUL: I have a personal conviction that this will not hurt anybody. You have government spending, that goes back to you.

Um, huh? Our economy is teetering on the precipice of a double dip recession (and I've seen some pretty persuasive arguments of late that we're already there) and you think putting 200,000 employees out of work and cutting five departments won't hurt anybody? Maybe I'm too literal-minded for this argument, but I fail to see how more people out of work, less money going out to various factions (because when HUD allocates money to low income housing, that money goes to JOBS building low income housing, or when Energy budgets for alternative energy funding, that money goes to provide JOBS building wind turbines, etc.) and cutting education for future workers is going to be beneficial to the country, even if the deficit is corrected. And economists on the right and left agree:

By reducing the deficit from more than $1 trillion to $300 billion in just a year, Paul’s plan would upend the economy at a time when it’s already fragile, says Gus Faucher, director of macroeconomics for Moody’s Analytics. “That much deficit reduction in one year is going to be a huge drag on the economy . . . the reduction in spending is much greater than cuts in taxes,” says Faucher. “We’re seeing that impact in Europe right now, where severe fiscal austerity has caused big problems for the European economy.” While long-term deficit reduction is important, legislators need to make sure that the economy is strong before major cuts take effect, he adds, calling Paul’s plan “much more ambitious” than other Republican proposals to date. By comparison, the Congressional supercommittee is required to cut $1.5 trillion over a ten-year period—a feat Paul wants to accomplish in a little more than one year.

Liberal economists were even more dire in their assessments of the Paul budget. “This is almost having the economy fall off a cliff,” says Dean Baker, co-director of the Center for Economic and Policy Research, estimating that cutting $1 trillion in 2013 would prompt the unemployment rate to jump by 3 percentage points. Even if the $1 trillion in cuts were done over two or three years’ time, there would still be double-digit employment, Baker concludes. “This will make it extremely hard to balance the budget, since if the unemployment rate goes to 11 or 12 percent, then the budget picture will look much worse. If his response is still more cuts, then who knows how high he can get the unemployment rate.”

Michael Ettlinger, vice president for economic policy at the Center for American Progress, said Paul’s cuts would destroy the social safety net, as the plan would turn Medicaid and other low-income entitlement programs into block-granted programs that would depend on discretionary appropriations. “Your kids would be out of school, working or begging,” he concludes.

Of course, Paul denies this economic certitude. Because in the Randian utopian in which he lives, this is the perfect opportunity for Americans to take care of themselves by shirking the moocher constraints having social safety nets provided by the government to be the supermen they were destined to be.

But Paul's rationalization for this is even more delusional than simply worshipping Rand. He makes up out of whole cloth the reason we got out the Great Depression.

GREGORY: How is that possible that a draconian cut like this would not hurt anybody, particularly in this economy?

PAUL: Because we have to take this money from the economy, and the fewer politicians get to spend it, so that’s a negative. It hurts the economy. After World War II, we cut spending by 60% and cut taxes. 10 billion people came home and all the money and the expenditures went back to the people, and that was finally, we got over the Depression, by having these draconian cuts.

Where the hell is he getting these facts? Roosevelt tried to cut spending and make allowances for business to encourage hiring and guess what? We slid deeper into the depression. What allowed us to get out of the Great Depression was the New Deal: government spending, the government Works Program and the implementation of the most successful social safety net program: Social Security. All programs that would be eliminated by President Ron Paul.

Like I said, absolutely delusional.


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