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Friday, March 18, 2011

Rep. Paul renews uphill push to abolish Fed

* Fed critic Paul renews push to eliminate central bank

* Paul says inflation hits lower-income groups hardest

* Experts before Paul panel urge return to gold standard

WASHINGTON, March 17 (Reuters) - Representative Ron Paul, a persistent critic of the Federal Reserve, on Thursday renewed his uphill fight to abolish the U.S. central bank, warning it is on track to create an inflation that will hit lower-income Americans especially hard.

The Texas lawmaker has long championed dismantling the Fed, but at a hearing on Thursday slammed its $600 billion bond buying program, which he said was creating inflation and undercutting the dollar. This week he introduced legislation abolishing the Fed.

"Frugality is virtuous only when it results from free choice, not when it is forced upon the citizenry by the Fed's ruinous monetary policy," Paul said at a hearing of a House of Representatives subcommittee that he chairs.

Rising energy and commodity prices have stirred inflation worries around the world and criticism that the Fed's vast expansion of bank reserves to buy Treasuries has stoked price rises.

Paul argued at the hearing that inflation hits low- and middle-income wage earners harder than affluent people.

"If you destroy a currency you will destroy the middle class," said Paul, whose long-standing antipathy to the Fed had found little support until the recent crisis.

Continue reading - Reuters - Rep. Paul renews uphill push to abolish Fed

Read James Grant’s Testimony - Highly recommended

Ron Paul Hearing 3/17/11: Relationship of Monetary Policy and Rising Prices

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