GOP Economy: Ron Paul's economic plan
Home State: Texas
Economic Platform: Ron Paul was among the handful of politicians in 2006-2007 who warned of an impending financial meltdown. And he has been a consistent critic of the prevailing financial order. His economic views are often described as libertarian and his call for measures such as ending the Federal Reserve put him on the margins of Republican politics.
In his 2009 book “End the Fed,” the Texas congressman argues that the Federal Reserve is responsible for economic booms and busts, a position that has little traction among most economists.
His economic platform stresses the need for deep budget cuts, including eliminating welfare programs, reducing Medicare and Social Security and phasing out what he calls “unnecessary bureaucracies,” such as the Department of Education, the Federal Emergency Management Agency, the Department of Homeland Security and the Internal Revenue Service.
Dean Baker, co-director of the Center for Economic and Policy Research in Washington, D.C., says Paul’s criticism of the Fed raises “a very valid issue, but I think he has the wrong solution. Getting rid of the Fed would be very dangerous. We had that in the 19th century and there was a lot of instability that came with that.”
Paul ran for president in 1988 and again in 2008. In an October Reuters/Isps poll of likely Republican voters, conducted between Oct. 6-10 with a margin of error of plus or minus 4.8 percentage points, he finished third behind Mitt Romney and Herman Cain.
Defense and Military Spending: Paul is the only Republican candidate who advocates a substantial reduction in U.S. military spending by scaling back military commitments, such as those in Iraq and Afghanistan, and reconfiguring the country’s military posture abroad. “We must focus our resources on defending the United States rather than on building and maintaining an unsustainable trillion dollar empire overseas,” Paul said in a letter he authored with six other congressmen in June. Paul claims that the United States would be able to effectively defend itself with one third of the current military budget.
Education: Paul has proposed the elimination of the U.S. Department of Education on the grounds that education should be handled at the local and state levels. He has recommended the use of education tax credits to allow families to choose their own schools.
Health care: Paul opposes universal health care because he believes that government interference in medicine leads to higher prices and less efficient care. In order to reduce health care costs for families, Paul advocates a tax credit for senior citizens who need financial support to pay for expensive prescription drugs and is in favor of importing drugs from other countries at lower costs.
Taxes: Paul is keen on lowering taxes and even abolishing the income tax, which he claims will help finally “turn off the lights at the IRS for good.” He is in favor of reducing the top corporate tax rate from 35 percent to 25 percent. The CEPR’s Baker says that Paul’s tax plan is basically revenue neutral: “I think at 25% if you really got rid of all the loopholes you would raise as much, maybe even a hair more.”
Social Security: In a GOP debate in Florida in October, Paul proposed a plan for young people to “get out of Social Security and go on their own.” He believes the plan won’t be there for the young people who are paying into it now.
Environment: Paul believes environmental legislation should be formulated and enforced at the state and local levels and believes the EPA is another Federal agency that needs to be abolished. Although the Texas congressman would like to see people and corporations held accountable for environmental damage, he remains skeptical of global warming, and has referred to it as the “greatest hoax.”