Either the Fed Goes, or I Do
Ron Paul retires from Congress, leaving behind a GOP that finally learned to love him.
This was basically what Paul said when the economic crisis began in 2008. "We risk committing the same errors that prolonged the misery of the Great Depression," he said at the first congressional hearing after the collapse of Lehman Brothers, "namely keeping prices from falling. Instead of allowing overvalued financial assets to take a hit and trade on the market at a more realistic value, the government seeks to purchase overvalued or worthless assets and hold them in the unrealistic hope that at some point in the next few decades, someone might be willing to purchase them."
Paul was calling for an austere response to the crisis, excruciating short-term pain and creative destruction that would be followed by a rebuilding. There was no public support for a plan like that—until there was. The bailout and the American Recovery Act didn't fail, nor did they bring about an economic comeback. Because they didn't, Americans were ready to hear alternative explanations for what was going wrong. Paul was ready. In the House, he held luncheons for members of Congress who could listen and talk to experts on the discarded, untested economic theories that could fix the country. One of the loyal attendees was Michele Bachmann; when launching her presidential campaign, she joked to the Wall Street Journal that she liked to read von Mises on the beach. The GOP's frontrunner in Iowa had been won over by Paul.
"His version of libertarianism is somewhat different from that of academics, and somewhat different from the so-called cosmopolitan version popular in East Coast universities and think tanks," says David Boaz, the vice president of the libertarian Cato Institute. "But in his 2007-8 presidential campaign he emphasized excessive spending, ill-advised foreign intervention, and dangerous inflationism by the Federal Reserve, and all those issues have become more prominent and more popular among Republican voters in the past four years."
When he ran four years ago, however, Paul didn't have any ideological competition. He was solo and sui generis. It was part of his quirky appeal. Now, there are plenty of Republicans who can call themselves his successors, and as long as Barack Obama is president, Paul's ideas are rolled into the GOP's double helix. Ron Paul used to be alone in saying no to everything, doubting that the elites were telling the truth. Now, there are plenty of other Republicans who think that way. There are real debates now about war funding and debt default. That's the legacy of screw-ups by presidents in both parties, and that's the legacy of Ron Paul.
David Weigel is a Slate political reporter. You can reach him at firstname.lastname@example.org, or tweet at him @daveweigel.
Photo by Justin Sullivan/Getty Images.