North Korea’s apparent test of a nuclear weapon yesterday is being greeted in the usual foreign policy circles as a case to do more of the same: more sanctions, more pressure, regime change. Is it wise to do the same thing and expect different results? Is there another possibility?
Ron Paul: Hello everybody, and thank you for tuning in to The Liberty Report. Daniel McAdams is with me today. Daniel, it’s good to see you.
Daniel McAdams: Good morning, Dr. Paul.
Ron Paul: Good. We have more of the same: international crisis going on, financial markets walking along, and gold going up. We want to talk about these current events, but the big news today is that it looks like those North Koreans are coming, and they may have a nuclear device. There was an explosion, but I don’t think anybody knows exactly what exploded. I suspect that the concern that is being expressed today about North Korean exploding something that would be hydrogen is probably stretched a little bit, we’ll have to wait and see. I don’t quite see the tremendous fear that seems to be developing, because the politicians have an opinion and everybody around the world has an opinion about what we have to do, the United Nations can get involved, and NATO is getting involved. And I’m sure behind the scenes, the military-industrial complex is getting involved. And the politicians are agitating for more attention to find out who’s the toughest on foreign policy and who’s the toughest on China and this sort of thing, and that’s going to go on.
One item that I think we shouldn’t ignore came from the people in the streets in Seoul, South Korea. Don’t you think that they would have sensed what is going on? There’s little more communication with their relatives in the North, and they don’t want a war started. They said they were rather calm and unconcerned about it, they said, “Oh, we’ve being going through this …”. So they didn’t see this as very much of a big deal. But I need you to tell me a little bit about how serious you think this is, and in the course of the discussion I also want to talk about non-interventionism, because some people jump and say, “Yes, we need more interventionism”, while other people suggest that maybe there is too much interventionism.
Daniel McAdams: Well, as was announced by the North Korean News Agency, the North Koreans have found a way to construct a thermo-nuclear device, which is a two-stage thermo-nuclear device, without going into details, but it’s orders of magnitude stronger than what they have tested before. However, cooler heads are now looking at it and it looks like rather than being a 10 kiloton, it sounds more like 7 kilotons. So the previous version may have been a sort of boosted version. In some ways, it’s irrelevant, because, as you say, the propaganda value of bringing this threat back in the news, terrifying all the Americans, bolstering the military-industrial complex, giving the Washington think tanks something more to scribble about (some new policy papers that are a lot like the old ones), really is the real effect.
Ron Paul: Yes, the markets are always of interest to me, because if there is an international incident, what is it going to do to the markets. Gold went up today and the stocks went down, and you might say that means it is very, very serious. Well, not necessarily. Maybe gold was destined to go up and the stocks were destined to go down, and this sort of incites the moves and I don’t think that’s evidence that it’s a real big issue. These changes in the markets were going to occur anyway.
But the politicians weren’t too bashful about this, and we’ll just talk about a few people who have spoken out. Rubio was not bashful about this, it just fitted into his scheme of blaming weak presidents, he said it was all Obama’s fault. He said if Obama would have been more intimidating and had put on more sanctions and things like that …but how can we put sanctions on a country that has no imports . Anyway, Rubio spoke up and there were some others who spoke up as well.
Daniel McAdams: Well, according to Donald Trump it is all China’s fault, even though China was one of the first to condemn it and firmly opposes this testing. Jeb Bush was similar to Rubio, he said, “The North Korean nuke test shows danger of continuing feckless Obama/Clinton policy”. That we might agree with if he meant coming to our side and knowing something different, but he’s talking about doing more of what they did.
Ron Paul: You know, this thing about Donald Trump saying it’s China’s fault, he went into a little bit more detail and said, “China is at fault because they are an advisory of ours. They are one of our biggest advisories around the world and we got to stop them and we got to be tough on trade”. So he said this is an excuse to be really, really tough on trade with China at this particular time.
Daniel McAdams: He completely misunderstands the role of trade, trade is very diplomatic. When trade happens, when trade happens, countries are more likely to get along, like you pointed out a few years ago when we had our little dust-off with china. You said that the fact that we traded with them so much, prevented it from escalating.
Ron Paul: It certainly is different today than compared to when I was in high school when our teachers were drafted and sent off to Korea to fight the Chinese. But it baffles me because somebody showed an interview that Donald Trump had quite a few years ago, and I have to say he was pretty consistent. Even ten years ago, he was a protectionist and a populist. But he’s a financial person, he gets his finances and easy credit from government, and he had to have had some help in his bankruptcies. If he never brings up Federal Reserve policy as one of the problems that we have in trade … so if we have the reserve currency of the world, we print a lot of money, we have cash flowing around here, and then the people who end up with this cash started buying where the products were cheaper; it was the inflate that caused that to happen. But he never claims that he understands the fact that that’s a benefit, we’re getting cheap products, we’re helping poor people in this country. And the money doesn’t go into a shoe box, they don’t burn it. The Chinese have turned around and loaned it back to us and brought things from us. But, to him, it’s all China’s fault, but it seems to me he doesn’t understand the trade issue.
Daniel McAdams: One of the problems of claiming you have all the answers is you have a lack of curiosity for other solutions. But I think this whole issue, and the title of our program is about the issue of interventionism and non-interventionism, and U.S. policy, to a degree, has driven North Korea to where it is. Here’s a great quote I found from a university student in North Korea, he said, “If we didn’t have powerful nuclear weapons, we would clearly have been turned into slaves of the U.S.”. I am sure we can say that he was clearly a victim of the propaganda of North Korea, but look at the real world and what’s happened to countries that have turned over their nukes. Look at Libya when it turned over its nuclear program, it had regime change. Look at Syria that didn’t have a program, it had regime change. Iran has turned over its nukes, it expanded its nuclear program and sent its enriched uranium to Russia, and what’s happening with Iran. Are U.S. politicians praising them for being flexible and giving up their nukes? No, they’re demanding even more action.
Ron Paul: Even today, when this subject came up, John Bolton, who I think leans towards neo-conservatism and who used to be our ambassador to the United Nations, was not explicit. But he threw it out, he said, “This is a serious problem, this is a big deal”. And I wouldn’t be surprised if what we need to look into is how the Iranians participated in the North Koreans getting this (nuke). He didn’t say Pakistan, he said the Iranians . He is beating up on them and yet, if you look at it strictly as an independent observer you may see that Iran is circled by all nuclear weapons countries. I believe they have actually downsized their nuclear program and turned over some of their nuclear material to Russia. I just hope it doesn’t do the same thing it did to Libya: “Okay, they can’t threaten us, they don’t have this, and now we’ll keep bashing them”. But it looks like they’re going to continue to bash them.
Daniel McAdams: You lose your deterrent. Given the boisterous reaction among the candidates, I don’t think anyone in his right mind is going to drop a nuke on North Korea, because they know that South Korea will be decimated. But the thing is, if the U.S., as it claims, is against nuclear proliferation, why does U.S. foreign policy encourage nuclear proliferation so much?
Ron Paul: Could you use that same argument about if our policies encourage radicalism of Islam, and as a recruiting tool, as many of us believe, why is the answer always, “Kill more Muslims” and being more anti-Muslim? And what do we do, we create more hostility. It is all the intervention, and one step leads to another. Don’t you feel better that the UN security council is meeting today, and they’re peacekeepers, so maybe something good will come from the UN.
Daniel McAdams: Well, they’re expected to call for more sanctions, so it’s more of the same things that caused the problem. When things like this happen … and we talked about this last year when the ISIS thing happened … you have a lot of people who agree with your foreign policy of non-interventionism. But then, all of a sudden, when something like ISIS happens or something like North Korea happens, they say, “Yes, I’m with you, Ron, but this is an exception, we got to really deal with this”. So it’s not hard to make the case, but the case is there that non-intervention would have prevented these issues from arising in the first place.
Ron Paul: Well, one thing that brings back memories is 65 years ago when the North Koreans did invade South Korea, it went to the United Nations, and there was a resolution to go to war. That was one of the most significant first thing that the UN did: to sanction the war, and, of course, that war went on, and finally it was a stalemate and a lot of people died and it was a big event. And you may say, “Well, that’s good, the communist never got control of South Korea”, but the communist maintain their power in North Korea.
What happened in South Vietnam after a bigger disaster of interventionism? The French and the Americans went on and on, and all these people killed and many were Vietnamese killed, and60,000 Americans were killed. And finally we had to admit it, this intervention is terrible, the neo-con says, “Yes, not 500,000, we need a billion soldiers over there, our intervention is not strong enough”. But what happened, what there a domino effect, did the communist run right over South Korea or South Vietnam? South Vietnam turned out to be more friendly, we trade with them and we travel there, and it’s not run by a communist government. There are still problems because unfortunately, when communism failed, it was too many people who accepted Keynesianism and interventionism and inflationism and corporatism, which will finally end. But, anyway, their dire predictions (about Vietnam) didn’t come out, so non-interventionism in North Korea may well have done the same thing. Non-interventionism in Vietnam, after all that death and destruction, turned out to be a better deal.
Daniel McAdams: I think that’s a good point, because both, Vietnam and China are, in name, ruled by communist parties. The fact that they have embraced the markets and embraced international trade, I think, has resulted in more individual freedom than in North Korea. Do they have perfect societies according to the most liberal American viewer? No, they and, but nobody can argue that Vietnam and China aren’t moving in the right direction with regard to individual rights and individual liberties. And that’s all come by economic activity.
Ron Paul: When this came up it made me stop and think today, it almost fits into the pattern of what the fear mongers need, and they can jump on it. Do they orchestrate this, you know, there are all kinds of stories about how the bombing of Pearl Harbor came about, did they orchestrate it, did they put up with it, did they tolerate and use it, and probably a variety of those things? But once it’s out there, it seems like the propaganda machine gets busy, whether it’s pro-war against Iraq or the sanctions against Iran. All the stuff seems to be well organized, and, for some reason, I just don’t believe it’s the executive branch run by the president who’s in charge. Yes, some of the politicians like Marco Rubio say, “It’s Obama’s fault, he allows this to happen”.
But I think war happens to bring some of these issues up, and I don’t know who those people are, but they’re out there because they seem to have a lot of influence with the media, they have a lot of influence with the moneyed interest in banking, in the military-industrial complex. And when there are overthrows of government, I don’t even know if the President knows what’s going on all the time. A fair number of American people right now believe that the CIA might have been involved with the Kennedy assassination. There is a lot of secret government going on, but they seem to have control of the propaganda machine.
Daniel McAdams: […] write that the 1% makes the rules for themselves, and they exempt themselves from the rules that everyone else has to follow, so there probably is something to that.
Ron Paul: This idea that maybe somebody said, “Today, this is what we’re going to do”, and the messages go out – it doesn’t quite happen like that, but it almost seems that way, like, “Today, we’re going to win this issue and we’re going to bash North Korea and show that we need more bombs and ships and the South China Sea is a problem and we have to have a bigger navy”. It reminds me of an economic story that happened a long time ago after FDR would call in the gold. There was no gold market, so he and Henry Morgenthau, the secretary of the treasury, said, “Well, we have to know what the price of gold is”, which was sort of like a communist idea because they were having deflation, something like what we’re having today, and they wanted inflation.
Today they want 2% CPI increase, but Roosevelt had the thing twisted around, he said, “We don’t want deflation, we want inflation, so we can get a price of gold up, and the recession and the depression will be ended”. He and Morgenthau would have breakfast every morning to decide the price of gold, and Morgenthau talks about it in his biography, he says one day, Roosevelt walks in and Morgenthau asks him, “To what should we raise the price of gold today?”, and he said, “21 cents”, and Morgenthau asked, “How did you come to 21 cents?”, and Roosevelt said, “Well, it’s 3 times 7, and 7 is a lucky number”. And Morgenthau wrote, “If anyone ever knew the stupidities that we went through …” and he admitted it was ridiculous.
Sometimes I get this idea that the way the news media handles this, it certainly is orchestrated when they want more action and they want more militarism. And these politicians don’t sit in those rooms, I don’t think Rubio sits in those rooms and says, “Okay, what we have to do is bash them more”, or whatever. I think they know where the power is and where the money is, and they want to have influence and they want to have a good retirement job. I think a lot of that has an influence on how these stories are portrayed.
Daniel McAdams: You remember this from your time in Congress, there is a perception among the American people that, “Oh, the congressman is so much better informed than I am, I’ve got to defer to his better sources of information”. But you know, because you were around them for years and years, they often have worse sources of information.
Ron Paul: Well, the ones I ran into, and I ran into a lot of them, and most people thought, “Well, how could you stand it?” Well, I sort of blanked out the issues and all, because personal confrontation was not my style. But I did get into a conversations, and sometimes they would come and initiate a conversation, which I liked. But there weren’t more than five, maybe even today there are not more than 5 or 10 who ever heard of Austrian Economics, who ever understood the Austrian explanation of the business cycle. They don’t worry about intervention, they never say, “Intervention is un-patriotic, it’s un-American, it’s not supporting the troops”, and on and on.
Anyway, there’s a lot of work ahead for us to try to sort these issues out, and today certainly is another day the foreign policy issue has had an effect on the monetary policy bringing about changes that were destined to come out anyway. I think so far this year, it looks like we’re going to see a lot more of this, but they’re not that difficult to deal with. The answers are out there and the understanding is there. They are not understood in Washington DC nor universities, but outside in the underground educational system on the internet and private schooling and different things, the issues are there. A better understanding of how free markets work and how trade really works, you don’t have to have protectionism, you have to have sound money, and you have to have a precise foreign policy. We should never be embarrassed by non-intervention, because non-intervention is a moral position and is also one that is very practical because it is the only issue that keeps governments out of war. Sweden and Switzerland being perfect examples of staying out of these things and staying out of problems. But, anyway, the problems are great, the answers are there, and hopefully we can contribute to spreading that message of liberty which can solve so many of our problems.
I want to thank everybody today for tuning in to The Liberty Report, and please come back soon.