A False Flag Infiltrator Accuses Ron Paul's "End the Fed" Campaign of Being a False Flag Operation
Dec. 1, 2009
A recent YouTube video says that Ron Paul's call to eliminate the Federal Reserve System is a false flag operation. Its title: "End The Fed Movement is a False Flag - says Andrew Gause."
What is a false flag operation? It is a deliberate charade to deceive the public. Wikipedia defines it accurately.
False flag operations are covert operations conducted by governments, corporations, or other organizations which are designed to deceive the public in such a way that the operations appear as though they are being carried out by other entities. The name is derived from the military concept of flying false colors; that is, flying the flag of a country other than one's own.
This accusation against Ron Paul's campaign is not simply outrageous. It is not simply venomous. It is imbecilic.
After ninety years, we finally get a broad-based movement to end the FED. Bernanke is terrified of it. He is fighting it as hard as he can. If you don't think so, read this:
What is this self-asserted conservative's response? To label Ron Paul as a false flag operator. Keep the FED, he says -- just nationalize it.
Idiocy, you say? Indeed. But it's an idiocy that goes back over 150 years. It is pure greenbackism.
I have labeled the greenback movement as false flag infiltrators. My article was titled, "False Flag Infiltrators: Gold-Hating Fiat Money Inflationists Inside the Libertarian-Conservative Movement." Read it here:
These fiat money inflationists come in the name of conservatism with a Left-wing message: turn over to Congress the power to create money out of nothing. These infiltrators have been running this scam since the late nineteenth century.
The video confirms my accusation as well as anything I have ever seen. It attempts to label Ron Paul and his followers as deceivers.
This will backfire. To label Ron Paul's movement as a false flag operation is to put up a neon sign that says Nut Cases R Us.
Note: I sent a pre-posting copy of this essay to the man who sent me the link to the video, who forwarded it to Gause. Gause (or the person who posted it) then changed its headline overnight -- without a spell check -- to Nationalize The Fed dont End The Fed" says Andrew Gause. The word is "don't." (He will probably change it again.) He knew he had gone too far tactically. He did not have the courage of his convictions to stick with the original title. But he forgot to change the title in the actual video. This man is not too swift on the uptake. You can see it here:
He should have removed the video. He merely changed its headline -- but not its title -- because he knew it would make him look like a dolt, once my article appeared. He had not figured this out before.
Let me deal with the accusation against Ron Paul and all those who support his call to abolish the Federal Reserve. It is based on a complete misunderstanding of the Federal Reserve -- the standard greenbacker analysis. It is also based on a complete misunderstanding of money. It is analytically wrong. It is another call for fiat money in the name of conservatism. There is nothing conservative about it.
Gause begins with an error that goes back 90 years. He says that the Federal Reserve System keeps all of the money that it receives from fiat money that it lends to the Treasury to buy T-bills and other government debt. This is not true. It has never been true. The FED gives back most of the money. The FED gets only operating costs. This is in the range of 10% of the money it turns back to the government. I have explained this here:
These false flag inflationists are utterly ignorant of economic theory. They are equally ignorant of the way banking works. They have not studied the actual operations of the Federal Reserve System. They are babes in the woods when it comes to economic theory.
They confuse well-meaning people who are also babes in the woods.
Gause specifically says that he is trying to convince Ron Paul's followers to leave the entire central banking system intact -- just nationalize it. That's right: he calls for the nationalization of the Federal Reserve.
He calls for the Treasury to issue fiat money. He says that the government can create money, and this will let the government stop all taxation.
In other words, there really are free lunches in life. There really is no scarcity. Government can take something of low value -- paper and ink -- and create wealth: money.
Ludwig von Mises had a phrase for this outlook: stones into bread.
The greenbackers have been pitching this inflationary Party Line ever since 1863, when Lincoln and Congress started printing fiat money not backed by gold; hence the term greenbacks. I suggest a slogan: "If you like wartime emergency measures that centralize political power and then become permant policy, you'll love greenbacks."
Greenbackers never change. They never learn basic economics.
Their targets are conservatives and libertarians who are, like them, babes in the woods. The difference is, their targets can and do learn economics -- Austrian School economics -- after they begin reading the materials that Ron Paul recommends. The greenbackers never learn anything.
They speak with such confidence. This confidence is not based on knowledge. It is based on ignorance. Because they speak confidently, naive newcomers think they know what they are talking about. They don't.
I began collecting books by these greenback monetary cranks half a century ago. I have about 100 volumes. They are all the same. Few footnotes, and none to anything written by an economist. No analysis of the actual operations of the banking system, other than broad strokes about fractional reserve banking. Just the same old mantra: "Let Congress run the monetary system."
The greenbackers hate gold. They hate gold with a passion. A gold coin standard would constrain Congress, and they want no constraints on Congress. They trust Congress. They are cheerleaders for Congress.
They are, in short, Left-wing populists. They have been allied with the Left ever since the 1880s.
How these ill-informed Leftists have weaseled their way into the conservative movement deserves at least a Ph.D. dissertation. Until someone writes it, I will leave it at this: End the FED! Don't nationalize it. End it.
Ron Paul will shrug off this video, as well he should. He has single-handedly created the first widespread anti-FED movement in American history. Andrew Gause's preposterous accusation will have no effect on him or most of his followers. But the man and the video deserved a response, and I thought I would provide it. After all, I wrote my first critique of greenbackism in 1965.
Gause should take down that video and post a retraction. He should admit that his accusation against Ron Paul was false. He got people to watch it by making a false claim. The video still accuses Paul and his followers of not doing what needs to be done: keep the FED, but turn it over to Congress to run.
This is what passes for conservatism these days. The blind are leading the blind into the ditch.
I am told that Gause sells gold coins for a living. If so, he is intellectually schizophrenic beyond anything I have seen in the pro-gold movement. He is giving aid and comfort to hard money's oldest American enemies, the greenbackers. It is not just that his right hand knoweth not what his left hand doeth. It is that his left hand holds a .357 magnum and is shooting at his right hand.