with the news makers. we mostly prepare for the good movie american dollar as it were for monetary around the world well forty golden years have gone by since nixon ended the last remnants of the gold standard but with the dollar in decline and gold basically golden and call for sound money resoundingly is it even possible to get that standard back. is money. no. and one of the biggest fans of the gold standard fell just short of a victory in the ames straw poll this weekend what's next for ron paul in the big ideas he represents. and with obama now riding his job bus on the campaign trail just two is to blame for the state of the economy i guess thinks he

has the answers. good afternoon it's monday august fifteenth four pm here in washington d.c. i'm lauren lyster and you're watching r.t. now as we see u.s. policymakers trying to figure out how to respond to the turmoil we've seen in the past weeks the stock market plummeting the downgrade of the u.s. credit rating by standard and poor's we can look back on history for a lesson still being felt today forty years ago to this day president nixon faced inflation staggering war costs which had caused an increase in money printing and a decrease in the value of the dollar also joblessness now he was fifteen months away from reelection ring a bell well that's about where president barack obama is right now and he gave the country the nixon shock in response to what he ended the last remnants of the gold

standard making it so dollars couldn't be converted to gold he rationalized it then this way. recent week the speculators have been waging an all out war on the american dollar. is going to the nation's currency is based on the strength of the nation's economy and the american economy is my role are the strongest in the world . accordingly i have the rest with the secretary of the treasury to take the action necessary to defend the dollar against the speculative already that it was defending the dollar critics argue it was one of the most important decision and modern economic history for a different reason that it cost the long term economy substantially now what's happened to the value of the dollar spent well let's take a look at all it has lost ninety eight percent of its value since going off of that peg to gold take

a look at that plunging the dollar bill in that red line going up that's how the money supply is increased the amount of money in the economy money printing what some might call that now what has happened to gold at the same time that prices have skyrocketed we've seen gold hit record highs at eight hundred dollars an ounce just last week right now it's around seventeen forty six the last time i checked remember during the bretton woods days it was pegged to thirty five dollars an ounce the dollar thank you it that was the price now it has gone up exponentially so what does paul say and where should a colleague joining us for more now is lou rockwell he is chairman of the ludwig gun uses institute thanks for being here now nixon back then said that this decision was about protecting the dollar as a pillar of financial stability around the world was it or did it that the state did for exactly the opposite including the three decades of boom and bust we saw since then. well there's a reason a nixon was known as tricky dick and a person was lying when he really did all those things i remember the speech and he

also impose price and wage controls in the manner of a dictator but it was a terrible thing again they also took the dollar off the remnants of the gold standard so i just executive this is own his own say so it was a terrible thing what this inaugurate it was for the first time in the history of the world money that was purely discretionary that is money that could be printed up by the central bank in our case the federal reserve just ad infinitum so that is exactly what's happened and that's what richard nixon intended he wanted a lot of inflation a korea left him so he thought it would be good you want to disguise that inflation by putting prices which controls on what he did was he brought about that got to work we should all remember nixon for this un but he did a lot of evil things and it was richard nixon but you're right this is probably just was a long lasting terrible thing you did and we're now suffering from it and we're the whole world is suffering from it because all the other countries that are allied

with the us went on a similar paper money standard with no switzerland with no no restriction on the central bank brought as you would exactly as you say booms and busts and a general reclined in by the way the standard of living of the average american the lower today lower right if i could just ask what are would you say is the the biggest example of how this cause a crisis you mention the booms and busts of the last three decades and we've seen the savings and loan crisis we've seen the housing bubble and now critics say that this was a seminal moment going off of the gold standard entirely and the creation of the global debt crisis that we see today confronting the u.s. confronting the world how so how do you connect nixon's decision back then to the debt crisis we face today. well this is the central bank was founded at the behest of big bankers norman we surprised to learn back in the days of the tapped and the wilson administrations at the beginning of the last century. and gradually it's

been unleashed so we can think of the central bank representing the big banks and representing wall street as having a leash around its neck nixon cut the finally something was under then the federal reserve was unleashed and the more that it prints the more that it lo i'm not going to get technical here but the more that lowers interest rates artificially it causes recessions and depressions we're in a depression right now the whole western world in fact is in a depression so that is a solution that is the next and depression the next and its mission is a solution to the depression you're talking about that you believe is going on and the countess was facing this country a return to sound money into the gold standard we certainly didn't return his son money we do need a gold standard i would say free market gold standard because if there's one thing every american in fact everybody in the world ought to know you can't trust the government in fact i would say nobody can be trusted with the power to just print unlimited numbers of new hundred dollar bills in your basement and spend them on

what you want nobody can be trusted with that and certainly politicians can't be trusted so a government gold standard is not the answer ron paul other very correctly suggests as a as a baby step towards a sound money system allowing competitive currencies allow other things besides the dollar to be used legally and from a tax standpoint have the same status as the dollar that would be a huge step forward that's the kind of thing we need to do and i think there's no question that gold without compete everything else as money just as it has for thousands and thousands of years and over those thousands and thousands of years we thought currencies were tied to precious metals they were tied to things like old now with a theocracy that's based on faith that's based on the performance of politicians and central bankers who you say. people can't trust now in the last couple weeks we've seen the u.s. credit rating downgraded because politicians failed to rein in debt and it was largely a political assessment of how effective politicians are doing their jobs we've seen

analysts say that the central bank is out of tools that the federal reserve has you know done too much sun ahead of easing or not enough quantitative easing how big of a threat for the current leaders to the u.s. dollar right now and its value added yet currency but let's understand first of all these people do not want to restrain they do not want to restrain spending both parties are dedicated to both parties or all of the economics of john maynard keynes they believe in spending they believe in that you know on alternative days they refer to the debt as a stimulus so this is just government as usual keynesian government as usual they do not want to and i'm very glad the standard report does that. not because the us will default we're going to print all the paper dollars they need to pay everybody off but the question is of course what will the dollar be worth the dollar is it your great chart pointed out has been plummeting in value it's going to continue to plummet in value and what the federal reserve is doing by holding interest rates near zero which the crazy keynes had advocated back and i think thirty six is not

only wrecking savers and investors but it's wrecking the future of the economy everything they're doing is a negative and by the way the republicans are every bit as much responsible for this and this and of course was republican the democrats or so both parties are in cahoots with you know goldman sachs and j.p. morgan and citibank and bank of america those sorts of institutions against the american people and i would say against the people of the world so we need a radical change and i'm going to ron paul is talking about well speaking of a radical change in return to sound money would that even be possible at this point or as legendary gold trader jim sinclair is that is that impossible that open pandora's box and derivatives that are still floating around the entire globe and reveal the lack of balance sheet integrity in the u.s. banking system where you can buy your assets at whatever you think they're worth. well it would reveal of course absolutely the bankruptcy of many financial

institutions but in order to get out of a depression once that once the federal reserve is brought on a recession or depression the only way to get out is to liquidate the bad investments not have the government tax regular people to bail out the toxic assets of the big banks we have to have bankruptcy once we have bankruptcy and we have the return of reality then we can rebuild but as long as we have this phony baloney system punishing the average person for the rich connected to the government we're going to have more and more trouble so we have to have bankruptcy massive bankruptcy that will be the beginning of the healing the beginning of a return to growth and prosperity but how much pain with that cause also the average person in the short run you know honestly there will be pain in the short run with that solution right of course of course has been you know it's a little like the alcoholic goes into the doctor and the doctor says i want you to stop drinking and the guy says well that's going to give me a lot of pain well that's right but first to get on the path to help you have to

stop agreeing so we have to stop the money printing we have to allow the big banks to go out of business if that's what's going to happen and my guess is they would go out of business because these fractional reserve banks are bankrupt anyway and especially these days as you know they have so many phony assets they you know they have. accounting board of standards was prevented from putting correct accounting standards into place so that the banks you continue to lie about what the what the worth of their so-called assets is needs to be cleaned up again we need real ism no more phony opium dreams out of the federal reserve and probably wanted to get credit that the federal reserve in congress to you mentioned is it congressman ron paul who is running for the republican nomination for president and he's taking on ben bernanke the federal reserve chairman head on over the issue of gold and money let's do a little bit of of him and hearing. does it do you think gold is money no

it's not money if you can you could question about it for six thousand years somebody reversed that and eliminated that economic law. now you he obviously challenging bernanke over what is money is gold money bernanke you saying no it's a precious metal and paul saying you know some people think that's still money now he's running as imagine for the republican nomination for president he was in iowa over the weekend for the straw poll which many thought he would win and joe bachman actually won i view with a very close second behind just by one hundred fifty or so votes but doesn't matter and what's next for him i want to get to you with that lou and ask those questions but first. is there she's in iowa and she shows us why this small state with just three million people there mostly white no diversity why but why does it matter so much to all these g.o.p. contenders well here's her ticket. is the place where six stalks of corn blankets the landscape simultaneously standing proud and swaying. were

city centers resemble a different time. and those who live here say they are the true and body of main street you know where. we're going to get you the we've. ever. people are generally very welcoming. more they're very practical people. it turns out that they're also very colorful the congress can look at all the candidates they come to our cities they come to our area we get to see meetings with them and ask them questions find out what their real. core values are we to be very very important the iowa caucuses is among the first softs in the presidential primary but for republicans the initial hurdle is always the i was strong well you could say its popularity contest county

fair but don't let this carnival like atmosphere for you what is happening right now and. very significant when it can determine who states and. campaign carries on it's a prime example of small town politics big time on the road all our lives here for two years and i see a lot i never felt more energy and interest in politics than living here actually going to give my girlfriend a little attack they call it retail politics out here you'll be able to talk to the candidates i think that's good good for iowa for sure. i get to expand how crazy is that but out of fifty states i was population ranks thirtieth at a mere three million people not break through the week so no more than ninety one percent of those who do live here are white on her feet and its economy is primarily our

cultural. looking the other group candidates nevertheless spend considerable time and money. in the party country organize and should be taken seriously on behalf of the over six hundred thousand i will republicans asked for this year the winner of the two thousand and eleven i was struck will is congresswoman michele bachmann and in second place by just one hundred fifty two votes congressman ron paul in one thousand nine hundred ninety george w. bush won the iowa straw poll and well he is the only one that's gone on to win the presidency so far iowa voters treat voting as a duty the people of iowa a pretty good seen through what's sometimes a little bit later a little bit shiny and they find a substance in the basics that are basically here in the candidates being from the midwest

a lot of times people so see us with what's the really the best about america and i think that we both people take it seriously. but for those on the outside it can also be a pretext in reality that in a land where corn is king it's people are in some ways viewed as kingmakers in ames iowa christine for south r.t. . all right our bring the rockwell back into conversation i know you have written a lot of the sort of articles about ron paul he didn't win the straw poll doesn't matter what's next for him well he came you know as you noted very close very very close and what i find interesting and in fact is a testament to the importance of what i would argue is victory in iraq is the fact that there's been a total media blackout on him after that when they announced that michele bachmann had won there was no mention of who came in number two and the whole media is but i guess the memo went out but she was on all the sunday talk shows ron paul wasn't even mention when i watched the other political talk shows this morning ron paul's

not even mention and various people have written articles about why it's appropriate it shouldn't be mentioned because he's not a militarist because he doesn't want endless wars and of course because he's against the whole bank or wall street rip of system the federal reserve and companies and i think i want to ask you about because he's gotten such a strong he's he's really initiated such support from dedicated followers over that message that you just mentioned which is resonating with people stop getting involved in all these wars bring our troops home the country cannot afford it we're broke bring that money back here and this has really propelled him just to see so much success in a way that many people once thought was impossible are these ideas going to change the political establishment has as you just noted they didn't even make it into the sunday talk shows. but the look the little excuse me the political establishment is going to have to be torn down they're not going to be changed they don't have to be replaced and i think ron paul can do that after you know absolutely americans in

fact one of the things he finds so interesting and me too is that college kids are so optimistic about his message you might think it's a pessimistic message but we have to return to reality but finally kids see somebody has got an idea of what to do not we don't just have to sink down and down into a sinkhole it is possible to fix ourselves that it is possible to change it is possible to have a prosperous economy no american thinks their children and grandchildren are going to be better off we all think they're going to be worse off economically ron paul shows us the way out of that the others don't if he doesn't get the nomination who will have supported him. i think probably nobody because you know they're not going to be for obama of course and they're not going to be for one of these militarist banks or candidates would it be rick perry would it be romney i don't know who might take ron's place but the people all say ron paul can't win they're just whistling past the graveyard he can win if people's hearts and minds change and you

know what he is changing people's hearts and minds everybody in this country knows we're in serious trouble we need a radical change and ron paul who is a very compassionate guy a man of peace a man of unbelievable economic knowledge unlike you know the rest of the people in the government actually can show us the path out so even if he were not to win the nomination he's changing the american people is changing and educating them and so i think it gives us hope for the future ok and real quickly if ron paul does not get the nomination and if he retires from congress as he as it had announced that he will if he doesn't get the nomination will this movement that you're talking about and the progression of society still continue i would argue will be even better because ron paul will be in the polls and politics and which has its problems politics will be involved in edge of his educational work he's always been the great educator and called reagan the great communicator that's ron paul so

he'll do this through his books he was speeches through his mother's newsletters and writings and he'll be anyone you can carry the torch politically i don't see anybody right now but you know somebody making when the american people demand it then all the politicians will be going along just like they all want to long with this idea of auditing the fed thought every republican in congress that that even though a couple years later they all would have said well that's a cool idea we love to have them as a great case people that's great but we'll see how that change continues and if it does beyond in the next few months at this rate and that's the question a candidate that was lee rockwell chairman of the ludwig money says institute. now still ahead right here on r.t. obama is cruising around the midwest to he is on a million dollar bus though made possible by taxpayers like you so what the wheels on that bus go round and round who's to blame when the economy's wheels are not turning.

point. what drives the world the fear mongering used by politicians who makes decisions break through. who can you trust no one who is you who with a global missionary see where are we heading state controlled capitalism schools

sessions when nobody dares to ask what we do our t. question more. as you. get up sometimes you see a story and it seems so silly you think you understand it and then you glimpse something else you hear see some other part of it and realize that everything you thought you knew you don't know i'm sorry welcome to the big picture.

all right president obama has that out on a bus tour to ride around and convince people that focusing on jobs is his number one priority meanwhile though my next guest says that the damage has already been done and to blame is the economic elite making off with forty six trillion dollars and wealth while sixty two million americans have zero net worth the nun and he says an economic world war is already unfolding despite obama's happy tour around in a bust he's here now to explain why david de graw is a journalist and author of this book the road through two thousand and twelve revolution or world war three thank you for being here yeah absolutely so you know first i want to ask you because you're arguing that that this is economic elites versus the core inequality is so big of world war is going to unfold or is but

these are not that i mean i'm starting to see comments like you're making in the editorial pages of very mainstream publications you have rubini talking about marx than that capitalism is is going to crash and burn and you have. bloomberg editorials about the gold standard bringing down the u.s. dollar you have so many editorials talking about this a good old days or got gone in there are no really good solutions do use an arms feel like you're reading the world socialist web site on these mainstream publications. i've been fighting to go to this new report i have out i'm trying to demonstrate the average american person who might not be as well as or he already knew that there is an economic world war are only on holding and in the united states we are on their economic path because not using hyperbole to say that we are

on the economic back in a second term we're hardly a card i mean as you said it was out there we have the highest we call the wealth in american with a very tiny fraction one tenth of one percent of the u.s. population consolidated trillions of dollars why would why don't we have record breaking. record breaking unemployment and you know the number of people unemployed right now is an all time record. and the government continue and along with the mainstream corporate media they continue to spread propaganda on almost all key economic indicators so in this report i break down or those keys. and i show how the government and for media propaganda make things work much better than they actually are maybe i'm sure americans understand but there's no economic recovery on the horizon what we're witnessing is

a car world bullying country you have a country right or a global banking cartel and i found it strange government but that's what i mean i'm glad you have and that's why i'm asking what do you think the mainstream media resists saying. the u.k. we are dealing with one united states we are all on their attack and so we understand it isn't a fact and coming out from behind our genes free and behind out that and create a physical presence i kind of had a good day the can you hear me able to hear me i don't. the thank you you know i want to ask you you're saying that what you're saying is very extreme but what i was asking as have you noticed that this is become less extreme i feel like you're starting to see this be talked about by economists by columnists in mainstream publications and that nobody thinks there's some good solution or good way out of it is something we've been saying for a long time on r.t.

but i think you're starting to see that more and more places and people mainstream people are realizing there is no good way out. well there's only so much propaganda people see and experience personal financial hardships propaganda or so you want to have a good knowledge and high respect and more than a little ugly. percent of humanity in being economically destroyed right now. whose fault is that the political elite economic elite the blame well basically what happened was and you go back to your point there is no way out there is a way out. common ground way out that everyone can agree on and that is one. and their central bank. and two and a system of. political bribery which is being fought in well being and the revolving door between washington ross tree and other major global corporations you

know we saw david. hill read. the biography of me so we go out there it's not going to happen ok ok that was you we saw warren buffett in an editorial after the tax more he said the super s. include himself and his friends should be taxed more essentially saying that right there my friends i have been coddled long asked by a billionaire from the congress it's time for our government to get serious about shared sacrifice do you think that he represents more wealthy people or do you think that this is the anomaly and his friends think he's crazy well it's one thing for people like warren buffett will say that but it's another thing to actually. going there were some actually wrong there ok what about howard schultz the c.e.o. of starbucks he's frustrated over leaders playing partisan agendas over people's agendas he's saying the country should go on strike against it against politicians and stop making campaign campaign contributions that includes insult that includes corporations ok well you shouldn't take his money and he says i'm doing some action

to make this happen on the ground until i start seeing that i don't hear any more words from these people whatever i can all agree is strong outcomes but then you just say earlier that the problem is the amount of money funneled into politics. yes but it is true that the absolutely pure so they actually change the campaign finance law being the result of. the. ongoing looting that philip howard told boycotts and some of his corporate buddies got on the bandwagon and they don't get campaign contributions you say that will make a change because it's a system. so i think oh it was a change you know every action we can be right now. all right well thank you that was david de graw thanks so much for being on the show journalist and author of the book the road through two thousand and twelve revolution or over war three thank you and that's in a different now from one of the stories we covered go to r.t. dot com slash usa or you to page you tube dot consular r.t. america you can.