Bernanke schooled on the destruction of the dollar
Federal Reserve Chairman Ben Bernanke visited Capitol Hill yesterday for a hearing before the House Financial Services Committee. Much of what he had to say was familiar. Bernanke repeated what most of us already know, that the United States is headed for severe debt problems if Congress doesn’t take on the river of red ink flowing from Washington.
But Bernanke and the Fed haven’t really taken responsibility for their continued role in the country’s fiscal problems, a point that Rep. Ron Paul (R-TX), who took time out of his campaign schedule to appear at the hearing, hammered home yesterday.
Paul didn’t really mince words in his questioning of Bernanke. At one point, he held up a silver coin, noting that the decline of the dollar has pushed silver higher. Paul explained that a troy ounce of the precious metal can purchase 11 gallons of gas today, whereas it could only buy four gallons in 2006.
Paul’s point is that the federal government and the Federal Reserve have done significant damage to the value of the dollar, to the point that it’s worthless. Of course, many will dismiss Paul’s questioning of Bernanke, but it’s hard to argue with his point; after all, with the rise in gas prices, which are being led by a mix of President Barack Obama’s bad energy policies and the declining dollar, are proof in action.