HON. RON PAUL OF TEXAS
Part 2 and end: The End of Dollar Hegemony 
Sat Feb 18, 2006 10:26

HON. RON PAUL OF TEXAS

Before the U.S. House of Representatives 

The End of Dollar Hegemony 

Part 2:

[ ] - Most importantly, the dollar/oil relationship has to be maintained to keep the dollar as a preeminent currency.  Any attack on this relationship will be forcefully challenged—as it already has been.

In November 2000 Saddam Hussein demanded Euros for his oil.  His arrogance was a threat to the dollar; his lack of any military might was never a threat.  At the first cabinet meeting with the new administration in 2001, as reported by Treasury Secretary Paul O’Neill, the major topic was how we would get rid of Saddam Hussein-- though there was no evidence whatsoever he posed a threat to us.  This deep concern for Saddam Hussein surprised and shocked O’Neill.

It now is common knowledge that the immediate reaction of the administration after 9/11 revolved around how they could connect Saddam Hussein to the attacks, to justify an invasion and overthrow of his government.  Even with no evidence of any connection to 9/11, or evidence of weapons of mass destruction, public and congressional support was generated through distortions and flat out misrepresentation of the facts to justify overthrowing Saddam Hussein.

There was no public talk of removing Saddam Hussein because of his attack on the integrity of the dollar as a reserve currency by selling oil in Euros.  Many believe this was the real reason for our obsession with Iraq.  I doubt it was the only reason, but it may well have played a significant role in our motivation to wage war.  Within a very short period after the military victory, all Iraqi oil sales were carried out in dollars.  The Euro was abandoned.

In 2001, Venezuela’s ambassador to Russia spoke of Venezuela switching to the Euro for all their oil sales.  Within a year there was a coup attempt against Chavez, reportedly with assistance from our CIA.

After these attempts to nudge the Euro toward replacing the dollar as the world’s reserve currency were met with resistance, the sharp fall of the dollar against the Euro was reversed.  These events may well have played a significant role in maintaining dollar dominance.

It’s become clear the U.S. administration was sympathetic to those who plotted the overthrow of Chavez, and was embarrassed by its failure.  The fact that Chavez was democratically elected had little influence on which side we supported.

Now, a new attempt is being made against the petrodollar system.  Iran, another member of the “axis of evil,” has announced her plans to initiate an oil bourse in March of this year.  Guess what, the oil sales will be priced Euros, not dollars.

Most Americans forget how our policies have systematically and needlessly antagonized the Iranians over the years.  In 1953 the CIA helped overthrow a democratically elected president, Mohammed Mossadeqh, and install the authoritarian Shah, who was friendly to the U.S.  The Iranians were still fuming over this when the hostages were seized in 1979.  Our alliance with Saddam Hussein in his invasion of Iran in the early 1980s did not help matters, and obviously did not do much for our relationship with Saddam Hussein.  The administration announcement in 2001 that Iran was part of the axis of evil didn’t do much to improve the diplomatic relationship between our two countries.  Recent threats over nuclear power, while ignoring the fact that they are surrounded by countries with nuclear weapons, doesn’t seem to register with those who continue to provoke Iran.  With what most Muslims perceive as our war against Islam, and this recent history, there’s little wonder why Iran might choose to harm America by undermining the dollar.  Iran, like Iraq, has zero capability to attack us.  But that didn’t stop us from turning Saddam Hussein into a modern day Hitler ready to take over the world.  Now Iran, especially since she’s made plans for pricing oil in Euros, has been on the receiving end of a propaganda war not unlike that waged against Iraq before our invasion.

It’s not likely that maintaining dollar supremacy was the only motivating factor for the war against Iraq, nor for agitating against Iran.  Though the real reasons for going to war are complex, we now know the reasons given before the war started, like the presence of weapons of mass destruction and Saddam Hussein’s connection to 9/11, were false.  The dollar’s importance is obvious, but this does not diminish the influence of the distinct plans laid out years ago by the neo-conservatives to remake the Middle East.  Israel’s influence, as well as that of the Christian Zionists, likewise played a role in prosecuting this war.  Protecting “our” oil supplies has influenced our Middle East policy for decades.

But the truth is that paying the bills for this aggressive intervention is impossible the old fashioned way, with more taxes, more savings, and more production by the American people.  Much of the expense of the Persian Gulf War in 1991 was shouldered by many of our willing allies.  That’s not so today.  Now, more than ever, the dollar hegemony-- it’s dominance as the world reserve currency-- is required to finance our huge war expenditures.  This $2 trillion never-ending war must be paid for, one way or another.  Dollar hegemony provides the vehicle to do just that.

For the most part the true victims aren’t aware of how they pay the bills.  The license to create money out of thin air allows the bills to be paid through price inflation.  American citizens, as well as average citizens of Japan, China, and other countries suffer from price inflation, which represents the “tax” that pays the bills for our military adventures.  That is until the fraud is discovered, and the foreign producers decide not to take dollars nor hold them very long in payment for their goods.  Everything possible is done to prevent the fraud of the monetary system from being exposed to the masses who suffer from it.  If oil markets replace dollars with Euros, it would in time curtail our ability to continue to print, without restraint, the world’s reserve currency.

It is an unbelievable benefit to us to import valuable goods and export depreciating dollars.  The exporting countries have become addicted to our purchases for their economic growth.  This dependency makes them allies in continuing the fraud, and their participation keeps the dollar’s value artificially high.  If this system were workable long term, American citizens would never have to work again.  We too could enjoy “bread and circuses” just as the Romans did, but their gold finally ran out and the inability of Rome to continue to plunder conquered nations brought an end to her empire.

The same thing will happen to us if we don’t change our ways.  Though we don’t occupy foreign countries to directly plunder, we nevertheless have spread our troops across 130 nations of the world.  Our intense effort to spread our power in the oil-rich Middle East is not a coincidence.  But unlike the old days, we don’t declare direct ownership of the natural resources-- we just insist that we can buy what we want and pay for it with our paper money.  Any country that challenges our authority does so at great risk.

Once again Congress has bought into the war propaganda against Iran, just as it did against Iraq.  Arguments are now made for attacking Iran economically, and militarily if necessary.   These arguments are all based on the same false reasons given for the ill-fated and costly occupation of Iraq.

Our whole economic system depends on continuing the current monetary arrangement, which means recycling the dollar is crucial.  Currently, we borrow over $700 billion every year from our gracious benefactors, who work hard and take our paper for their goods.  Then we borrow all the money we need to secure the empire (DOD budget $450 billion) plus more.  The military might we enjoy becomes the “backing” of our currency.  There are no other countries that can challenge our military superiority, and therefore they have little choice but to accept the dollars we declare are today’s “gold.”  This is why countries that challenge the system-- like Iraq, Iran and Venezuela-- become targets of our plans for regime change.

Ironically, dollar superiority depends on our strong military, and our strong military depends on the dollar.  As long as foreign recipients take our dollars for real goods and are willing to finance our extravagant consumption and militarism, the status quo will continue regardless of how huge our foreign debt and current account deficit become.

But real threats come from our political adversaries who are incapable of confronting us militarily, yet are not bashful about confronting us economically.  That’s why we see the new challenge from Iran being taken so seriously.  The urgent arguments about Iran posing a military threat to the security of the United States are no more plausible than the false charges levied against Iraq.  Yet there is no effort to resist this march to confrontation by those who grandstand for political reasons against the Iraq war.

It seems that the people and Congress are easily persuaded by the jingoism of the preemptive war promoters.  It’s only after the cost in human life and dollars are tallied up that the people object to unwise militarism.

The strange thing is that the failure in Iraq is now apparent to a large majority of American people, yet they and Congress are acquiescing to the call for a needless and dangerous confrontation with Iran.

But then again, our failure to find Osama bin Laden and destroy his network did not dissuade us from taking on the Iraqis in a war totally unrelated to 9/11.

Concern for pricing oil only in dollars helps explain our willingness to drop everything and teach Saddam Hussein a lesson for his defiance in demanding Euros for oil.

And once again there’s this urgent call for sanctions and threats of force against Iran at the precise time Iran is opening a new oil exchange with all transactions in Euros.

Using force to compel people to accept money without real value can only work in the short run.  It ultimately leads to economic dislocation, both domestic and international, and always ends with a price to be paid.

The economic law that honest exchange demands only things of real value as currency cannot be repealed.  The chaos that one day will ensue from our 35-year experiment with worldwide fiat money will require a return to money of real value.  We will know that day is approaching when oil-producing countries demand gold, or its equivalent, for their oil rather than dollars or Euros.  The sooner the better.

[andend] - Published February 15, 2006 - Url.: http://www.house.gov/paul/congrec/congrec2006/cr021506.htm

RELATED REFERENCES & LINKS:

* "Sarah, if the American people had ever known the truth about what we Bushes have done to this nation, we would be chased down in the streets and lynched." - George Bush Senior speaking in an interview with Sarah McClendon in December 1992. - And here's why: 'George Bush: The Unauthorized Biography' - by Webster G. Tarpley & Anton Chaitkin - Chapter - II - The Hitler Project - Url.: http://tinyurl.com/57qxk

* The Top Ten American War Criminals Living Freely Today - Url.: http://tinyurl.com/dvudx

* What Bush c.s. - the neocons* and their collaborators - are afraid of - Url.: http://tinyurl.com/95nk2

* Entertainer Harry Belafonte, one of the Bush neocon administration’s harshest critics, compared the US Homeland Security Department to the Nazi Gestapo - Url.: http://tinyurl.com/8uvoe

* On the buckles of the belts Hitler's Nazi-SS wore, it said the same as George Bush is using now: "Gott mit Uns" - 'God is on our side' - SS/CIA - Url.: http://tinyurl.com/9xqcr

* Google search "Biggest threat to world peace" - Url.: http://tinyurl.com/dk2lj

* The Pentagon's propaganda war - BBC - Url.: http://tinyurl.com/3ser2

* MSNBC - Live Vote: Do you believe President Bush's actions justify impeachment? - Url.: http://www.msnbc.msn.com/id/10562904/

* "People do not forget. They do not forget the death of their fellows, they do not forget torture and mutilation, they do not forget injustice, they do not forget oppression, they do not forget the terrorism of mighty powers. They not only don't forget: they also strike back." - 2005 Nobel Literature Prize winner Harold Pinter - Url.: http://tinyurl.com/9cyeq

* Those who first of all start shouting about 'conspiracy theory' and 'paranoļa' or similar, are always the evil INFORMANTS The paid INFILTRATORS which are afraid of being disclosed. They are the real Judas's working for treacherous 'masters' - they are the 'Quislings' that will go to jail - Url.: http://tinyurl.com/clcjn

* The Nuremberg principles: "Any person who commits an act which constitutes a crime under international law is responsible therefor and liable to punishment." - Url.:  http://tinyurl.com/byurp

* 'The war in Iraq is illegal' - BBC: video & text-interview of the United Nation's Secretary General Kofi Annan - Url.: http://tinyurl.com/5pl2v

* 'Spreading democracy' - Countries & US Death Squads - Url.: http://tinyurl.com/drnca - A 55' second sound bite concerning the US 'bringing democracy' everywhere - Url.: http://tinyurl.com/5u98v

* 'Crying Wolf' - Media Disinformation and Death Squads in Occupied Iraq - Url.: http://tinyurl.com/7ttx8

* Reference guide to the Geneva Conventions - Url.:  http://www.genevaconventions.org

* Al Qaeda – The Database - Url.: http://tinyurl.com/cqx69

* The 9/11 WTC drama was by the PNAC criminals planned terror - Url.: http://tinyurl.com/b7ygk - It was an inside job - Google - Url.: http://tinyurl.com/7tj9d

* Wayne Madsen - ''The neo-cons have done to the U.S. Intelligence Community what Hurricane Katrina did to the Gulf Coast and New Orleans. America has never been weaker. Rather than creating a "New American Century," the neo-cons have created a new global "Dark Age" of fear and constant war.'' - Url.: http://tinyurl.com/bj754

* Who's financing? - The 'Federal Reserve' and it's usurers is the absolute biggest crime against all humanity ever. - Url.: http://www.apfn.org/apfn/reserve.htm

* NWO letter: ''we can cancel your credit or freeze your accounts'' - Url.: http://tinyurl.com/cjo7l

*Read the Fightin' Cock Flyer - Url.: http://fightincockflyer.blogspot.com/

* 'Freedom of the press is guaranteed only to those who own one' — A.J. Liebling - The merciless engine of propaganda has been turned on: The infamous US 'Lie Factory' - Url.: http://tinyurl.com/8ncal

* He who travels far will often see things

Far removed from what he believed was the Truth.

When he talks about it in the fields at home,

He is often accused of lying,

For the obdurate people will not believe

Inexperience, I believe,

Will give little credence to my song.

'Journey to the East' - Hermann Hesse

* Help all the troops - of whatever nationality - to come back from abroad! - AND WITH ALL THEIR WEAPONS, WHICH WE WERE FORCED TO PAY FOR BY TAXES - [http://www.apfn.org/apfn/reserve.htm ] - We need them badly at home in many countries to fight with us against our so called 'governments' and their malignant managers - Url.: http://www.bringthemhomenow.org/

* FPF-COPYRIGHT NOTICE - In accordance with Title 17 U. S. C. Section 107 - any copyrighted work in this message is distributed by the Foreign Press Foundation under fair use, without profit or payment, to those who have expressed a prior interest in receiving the information. Url.:  http://liimirror.warwick.ac.uk/uscode/17/107.html

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