Dear Friends,

Once in a while a speech is given in the floor of Congress which deserves special attention and wide publicity. On February 25, 1997, Congressman Ron Paul, from Texas, delivered just such an address. Mr. Paul was recently elected again to Congress after a 12-year absence in the House. He is a constitutional Congressman and this speech gives a refreshing notice that there still are those in Congress who are not afraid of espousing the Founding Fathers answers for America's troubles. We have edited down to six pages and inserted subheadings. - E.T.


House of Representatives - February 25, 1997 by Congressman Ron Paul

Mr. Speaker, many Americans are not happy with the direction in which this country is going nor with the efforts that Congress has made to solve our problems.

By superficial analysis and as measured by Government statistics, our leaders would have us believe that the state of the union is strong. Yet with casual observation, one detects smoldering discontent among the people. In looking for solutions, Congress engages in political grandstanding that produces few answers for that growing number of Americans not confident about their future. Even many of those who are well off worry that their own futures, and certainly their children's futures, are not secure.

Band-Aids and Facades Offer No Real Answers

Confidence in the future is far from robust. The balanced budget amendment, the line-item veto, term limits; they will not solve our economic and social problems. Cynicism flourishes throughout the land and especially here in the Congress. Frustration over how to solve our problems has led to rude behavior that once was rare in the House. Civility classes only address the symptoms and will not solve the philosophic conflicts nor address the economic limitations that are the source of the impasse the welfare state now encounters.

The radical political correctness movement undermines the first amendment and contributes to the anger expressed by various groups. Intimidation and ridicule of unpopular ideas are hardly a way to bring different social groups together. The same individuals that demand censures of those who do not use politically correct language condemn voluntary prayer as a violation of the First Amendment. A consistent position on free speech will go a long way toward softening the growing resentment that strains our relationships with each other.

Not Enough Young Victims Left to Tax

Our welfare state is now broke. We cannot meet our future obligations, now estimated to be over $17 trillion. We must one day admit this fact. There are just not enough young victims left to tax to continue the process. We can and are limping along by continuing to rob Peter to pay Paul. This can last for a while longer but eventually we will have to admit that borrowing, taxing and inflating will not suffice.

These techniques pursued over the past 60 years cannot replace working, producing, saving, investing as the real source of wealth and prosperity. Government is incapable of producing wealth. Productivity growth, according to the Wall Street Journal, is now .3 percent per year. This is similar to pre-industrial revolution days. If this continues, it will take 10 generations for a person to double one's income. Inflation has eaten away at the seemingly huge welfare payments that we no longer can afford. The average welfare check in 1970 was worth twice that of 1996.

The principle that underpins the welfare state must be challenged. Anything short of that will cause the demise of welfare to smolder for decades, with the offer of more poverty to many more Americans. Under those circumstances, the role and the size of the Government will continue to grow, despite the current favorable rhetoric. In recessions, expanding welfare is irresistible, and the next one will be no different. There is a growing consensus that something is seriously wrong with our economy and political system, and that is a start.

Asking the Right Questions Can Produce the Right Answers

Too often, though, answers are given before the right questions are asked. Fixing the current system occupies the attention of those sincerely worried about the future welfare of the country. Budget, tax, education, regulatory reforms are promoted as solutions to our mess. Rarely do we hear that the system itself is flawed and the unintended consequences were not at all unexpected.

The line-item veto, heralded by many as a tool needed to rein in spending, will prove the opposite, while, unfortunately, delivering more power to the executive branch of Government. Technical gimmicks outside a philosophic approach to Government will not solve problems, even if well-intended.

It is a losing battle. The cost of Government is growing 3 times faster than the Consumer Price Index (CPI) and now takes more than 40 percent of our income, and of course it is not even counted in the CPI. No wonder the people are more upset than the Government thinks they should be considering a subdued CPI, high employment and a soaring stock market. No sales tax, flat tax, value-added tax, lower capital gains tax, or even dynamic scoring will bring about the miracle that will allow the immoral redistribution of wealth inherent in a welfare system to persist without a serious attack on our standard of living and our personal freedoms.

A tremendous amount of energy has been put into the balanced budget amendment movement. The whole balanced budget amendment debate has served perversely to distract from the important and key issue of the level of Government expenditures. A balanced budget achieved at $1.7 trillion offers no benefit whatsoever and a great deal of harm compared to a trillion dollar budget out of balance.

This whole debate over the balanced budget amendment has co-opted the important issue of the proper size of Government. The deficits have exploded ever since welfare benefits became equivalent to an entitlement and a right. Removing any restraint on the Federal Reserve to monetize the debt, by severing the last link of the dollar to gold, was not a coincidence and conveniently accommodated congressional deficit spending. It was necessary to delay the inherently failed financing that must always accompany a welfare state.

Dwelling on changing the Constitution to make Congress act responsibly begs the question: If Congress ignores the Constitution in so many other ways, why would one expect Congress to become obedient to this one new amendment? The escape clauses will permit the deficits to continue if the amendment passes. With or without the amendment, we are still forced eventually to ask the serious question as to what the Government is permitted to do if we return to the rule of law. That is the Constitution. Without respect for the doctrine of enumerated powers, for which there is currently little concern in the Congress, another constitutional restraint placed on Congress will do little more than pacify a few vocal groups. If we use Social Security funds to balance the budget, the support for this project will quickly fade.

Day of Reckoning Fast Approaching

Our Tax Code encourages exporting of capital, our regulatory system sends businesses overseas, and our corporate welfare state subsidizes overseas investments over domestic ones. At the same time, we welcome millions of illegal immigrants with free health care, education and housing. None of this makes sense. It only drives us more quickly to the day of reckoning. My guess is that that day is not far off and that we have in real terms consumed a lot of our capital and sacrificed many of our freedoms.

The concept of complete self-reliance and personal responsibility absent of Government programs is foreign to most Americans. Individual bankruptcy is preceded by a call from a banker refusing the next loan to pay for the last one. Suddenly, conditions change and that individual accustomed to a high standard of living paid for with borrowed money has a sharp setback to his standard of living. A nation never gets that call from a banker, since it serves as its own banker. The crisis comes when confidence is lost in the money. Confidence may erode gradually, but dramatic changes will also occur.

The Constitution Prohibits What We Are Now Doing

The 20th century has not been good for honoring standards. The Constitution has certainly suffered as a standard for our law. Respect for the doctrine of enumerated powers has been undermined by grotesque interstate commerce laws and general welfare clause interpretation that mocks the Founders' attempt to strictly limit Government power.

A Congress sworn to uphold the Constitution ought to be protecting our right to our property, not confiscating it. Congress ought to protect our right to own a weapon of self-defense, not systematically and viciously attacking that right. Congress ought to guarantee all voluntary association, not regulate and dictate every economic transaction. We should not allow Congress to give credence to inane politically correct rules generated by egalitarian misfits. Setting quotas ought to insult each of us.

The foreign policy resulting from the philosophy that promotes welfarism is one of militarism and foreign interventionism. The Constitution does not permit the use of force to mold the internal affairs of other nations and involve ourselves in all worldwide conflicts. Creating a weapons industry and subsidizing international sales are not only forms of welfare, they distort the entire notion of providing for the national defense. It should surprise no one that our foreign policy is up for sale at election time. Our 20th century intervention in foreign policy supported by blind bipartisanship and based on the principle of using force in dealing with other nations threatens our security and challenges U.S. sovereignty.

The sooner we establish a policy of neutrality, advocated by the founders of this country as well as the political parties and Presidents prior to the 20th century, the better. It would be a lot wiser policy than the one we are following today.

Bad ideas cannot become worthwhile by good intentions. The pragmatism of interventionism cannot replace the rule of law that the Constitution gives us. Respect, once again, must be given to the limitation of government power that permeates this document.

If we do have problems, how serious are they and what should we do about them? Few will agree we have no problems at all. For those who do, they can just ignore the entire situation. Most of us who find ourselves in the Congress got here talking about conditions that are unsatisfactory and need changing. No correct answers can be given if the pertinent questions are not asked.

What Is The Proper Role of Government?

First, are our problems due to mismanagement, waste and fraud, or do they stem from a flawed notion about what the role for government ought to be? I believe our problems are a result of a flawed notion regarding government. The waste and fraud argument only distracts from the serious consideration about what the proper role for government ought to be.

Our founders profoundly believed government's role was to protect liberty, and the Constitution explains precisely the powers the people granted to the Government. The counter-revolution to this noble experiment, unlike most counter-revolutions, did not immediately follow our establishing independence from Britain. It occurred in this century, gradually and without military conflict. The evolution of the welfare state subtly and steadily undermined the principle of private property, free markets, and sound money, and has brought us to the brink of bankruptcy.

Most Americans, if asked, would agree they would prefer to live in a free society over a socialist or a planned society, yet most continue to endorse the principle of government intervention in personal and economic affairs, a principle that has become acceptable this century, while replacing the principle of a free society the Constitution was designed to protect.

We will be forced to recommit ourselves to a different philosophy of government if we want to live in a free society. Perpetuating a bankrupt welfare state requires more and more authoritarianism with no chance of paying the bills and with a continuing erosion of our standard of living. The looming financial crisis will not quietly go away.

The prevailing moral principle of the 20th century that stole the revolution is simply: The government has been granted the arbitrary use of force to bring about social and economic changes.

Knowing the full meaning of this reveals a monstrous notion. It is this idea that permits today's programs of taxing, spending, regulating, confiscating, militarizing, harassing, policing, instructing, controlling, borrowing, inflating, moralizing, and meddling, while integrating government into every aspect of our lives; all done, of course, in the name of doing good. If the founders of this country are watching, they are surely embarrassed. What they fought for we have frittered away.

I am optimistic, though, enough to believe that most Americans truly want to live in a free society. The numbers are rapidly growing, especially since the handwriting is on the wall and the government largesse is coming to an end. The message of liberty appeals especially to the younger generations, since they increasingly see themselves as the victims of a bankrupt welfare state that may smolder for a long time.

What principle must we accept if the welfare principle is to be replaced? The same one the founders followed in writing the Constitution: The Government does not have the moral authority to use force to mold society or the economy, nor does any person have this authority.

Government's role is to restrain force when individuals violate the rights of others, which means no robbing or killing and breaking of one's contract. Molding behavior and regulating the economy, even if well-motivated, are not permissible in a free society. The problem with the idea that a little socialism or a little welfare is needed is that once the moral principle upon which welfare depends is conceded to any degree, there is no moral argument for limitations. Politicians trading votes and lobbyists earning a top-notch living will then determine the limits. Limitations will only come when the funds disappear, precipitating anger, frustration, and sacrifice of personal liberty.

Needed: Less Compromise, More Political Absolutes

It has been said that the art of politics is compromise, and on the important issues, bipartisanship is crucial. If one group wants $30 billion for a welfare program and the other wants $20 billion, both will settle for $25 billion. That is no compromise, that is a total victory for those who endorse force and taxation to redistribute wealth. Those arguing for less achieve nothing because they concede the authority to the State to rob Peter to pay Paul. Yes, a little less, but so what. If we come up short before the fiscal year end, a supplemental appropriation will pass to make up the difference. That is compromise?

Compromise has a good name, but there are and must be political absolutes regarding the role for government. Otherwise there are no limits to spending and deficits. Some argue there are only gray areas in politics, and only compromise will permit workable solutions. Surely there should be no compromise on murder, theft, and fraud. These should be either illegal or not.

The promoters of welfare endlessly use the compromise argument to soften the opposition. Compromise sounds so gentlemanly and compassionate. In reality, those arguing for slightly less have conceded the entire argument to the welfarists that government has the authority in the first place to promote forced redistribution. Right and wrong should be argued, just as right and wrong are argued on murder and theft.

The record is clear that the compromise approach has been very successful for the welfare state. The spending is endless and deficits persist, while demands continue to grow.

Simply put, government, even through congressional legislation, has no moral right to steal. It is wrong and the Constitution prohibits it. Compromise with welfare proposals will be no more successful than the Missouri Compromise was in solving the slavery question.

Government Actions Leading to Authoritarianism and Violence

A society that condones government violence and forced redistribution of wealth while attacking the right of its citizens to defend themselves against violence must by its very nature accept authoritarianism as a way of life. This will lead to severe unwanted violence on a grand scale, since the use of violence has been accepted as a proper government function. Tragically, the only defense eventually will be for the people to counter it with their own force.

The purpose of politics is simple but profound: It is to achieve liberty, unless one wants authoritarianism. Why should we have liberty? A society honoring individual liberty permits the best hope for mankind to achieve progress in all that we do. Achieving excellence, virtue, happiness, spiritual well-being, economic security, and mental satisfaction can best be accomplished through voluntary means, available only in a free society.

The Constitution: The Real Contract for America

We must agree on the ground rules that the people have established with the Government. The Constitution, although now generally dismissed, provides that contract between the people and the Government. Although imperfect without the agreement, and that is essentially what we have today, we see the anarchy of special interest government in a desperate effort to satisfy their demand as bankruptcy draws near. Street muggings to transfer wealth are morally comparable to an IRS mugging used to separate a citizen from his hard-earned cash. Splitting the difference on an appropriations bill will do nothing to solve our problems. It will only make them worse by perpetuating an immoral system.

The key to the Constitution working is our acceptance of the premise laid down by Jefferson: "All men are endowed by their Creator with certain unalienable rights." Rights, being natural or God-given, are the only moral alternative to the secular humanists who finds violence a proper tool to promote the authoritarian agenda through government monopoly education.

As our national bankruptcy unravels and we lose confidence in the dollar, more and more Americans want real answers to our problems. We will not find these answers in tinkering with the present system. That will only delay the inevitable and further inflate the financial bubble. As this becomes more evident, expect more Americans to look toward liberty and away from tyranny. A growing army of Americans is once again being introduced to the principles of liberty, and they like what they see. America can remain the bastion of liberty and peace, and it need not be a painful decision. Freedom requires no sacrifice. If any suffering comes, it must be laid at the doorstep of those who have excessively spent, regulated, and taxed. Restoring liberty, eliminating taxes, releasing our creative energy from the chains of big government bureaucrats, and permitting people to keep their earnings guarantee a prosperity and security not yet known to man. Self-respect and natural pride would follow.

The liberty bridge to the 20th century is the bridge I hope we use, not the one offered to us and built by the status quo. I plan, with many others, to work to build the liberty bridge.


As Congressman Ron Paul expressed, "A growing army of Americans is once again being introduced to the principles of liberty." During the past few weeks, NCCS has taught seminars in New Hampshire, Michigan, and Texas. The next few weeks will take us to audiences in Texas, Florida, Arizona, and Pennsylvania. Thank you for your continuing monthly financial assistance to help this effort succeed.


Earl Taylor, Jr.