Banking Committee: March 17, 1999
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Clinton Administration Proposal that the IMF sell-off gold holdings
House Committee on Banking and Financial Services
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Statement of
HON. RON PAUL
OF TEXAS
"The Clinton Administration's proposal for the International Monetary Fund to sellsome of their gold holdings should be rejected outright as misguided and historicallyoffensive.
"I am pleased Rep. Jim Saxton's Joint Economic Committee has todaycriticized the proposed gold sales, stating in a press release that it 'will accommodatemore IMF loans, subsidies, and moral hazard problems.' A renewed IMF would further distortthe market pricing of credit and aid the transfer of wealth from taxpayers to a few selectgroups: officials of inept, and often corrupt and brutal, governments; already over-paidinternational bureaucrats who don't pay taxes themselves; and Wall Street fat cats.
"In short, the debt relief proposal is an admission of failure of the IMF's 'papergold' policies. The IMF pushes irresponsible monetary policies with ever-larger debtburdens on client countries. These policies only exacerbate human suffering around theworld as citizens of poor countries suffer the burden of a higher cost of government,higher cost of capital and reduced economic growth.
"This is a prime example of harming nations with the very mechanism which purportsto be helping them. For example, Ghana is one of the Heavily Indebted Poor Countries(HIPC) the debt relief proposal is meant to help. However, 40% of Ghana's total exportscome from gold whose price would fall. Such a move will also destabilize Nelson Mandela'sSouth Africa, which is the largest producer of gold in the world. Needless to say,producers of gold in the United States will be similarly hard hit.
"It is ironic that proponents of U.S. membership in the IMF argue we have a claimto an asset. However, by selling off the IMF's only real 'assets,' any possible value tothe US evaporates.
"It should not be forgotten that the money the U.S. used to pay our initialcontribution to the IMF came from the 'paper profit' of President Franklin Roosevelt'sforced confiscation of gold from the American people. The gold that the U.S. governmenttransferred to the IMF should be returned to the American people, from whom it wasforcibly taken.
"I am so amazed by the cavalier attitude toward the American people and thecitizens of countries around the world, that I today introduced HR1147 to withdraw the USfrom the IMF and HR1148 to abolish the Federal Reserve."
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