Ron Paul Shaping the Republican 2012 Race

By Philip Elliott
Associated Press
August 13, 2011

DES MOINES, Iowa (AP) — Ron Paul, once seen as a fringe candidate and a nuisance to the establishment, is shaping the 2012 Republican primary by giving voice to the party’s libertarian wing and reflecting frustration with the United States’ international entanglements.

The Texas congressman placed second in a key early test vote Saturday in Ames, coming within 152 votes of winning the first significant balloting of the Republican nominating contest. Rep. Michele Bachmann of Minnesota won the nonbinding Iowa straw poll, but Paul’s organizational strength and a retooled focus on social issues set him up to be a serious player in the campaign.

“I believe in a very limited role for government. But the prime reason that government exists in a free society is to protect liberty, but also to protect life. And I mean all life,” he told a raucous crowd on Saturday.

“You cannot have relative value for life and deal with that. We cannot play God and make those decisions. All life is precious,” he said, opening his remarks with an anti-abortion appeal to the social conservatives who have great sway here in Iowa’s leadoff caucuses.

Later Saturday, Paul won 4,671 votes, or roughly 28 percent of the votes from party activists who flocked to a college campus for the daylong political carnival

Paul’s narrow second-place finish pushed former Minnesota Gov. Tim Pawlenty down to third, leading Pawlenty on Sunday to abandon his effort to challenge President Barack Obama next November.

Four years ago, Paul sought the GOP nomination while talking about economic policy, liberty and the Federal Reserve. Since then, the tea party has risen and seized on those issues, and some regard Paul as one of the movement’s godfathers.

“The country’s bankrupt, and nobody wanted to admit it. And when you’re bankrupt, you can’t keep spending,” Paul said Thursday during a Fox News Channel debate.

He may lack the broad appeal that former Massachusetts Gov. Mitt Romney or Texas Gov. Rick Perry are claiming, but Paul’s finish Saturday indicated he could compete.

Paul typically does well in such straw polls, which rely on supporters’ intensity and organization. His base helped him win straw polls at June’s Republican Leadership Conference in New Orleans and February’s Conservative Political Action Conference in Washington, and his followers organize online to ensure strong finishes at any contest they can find.

It is part of their effort to get rid of the notion that Paul is a fringe candidate.

Paul’s 2008 campaign came up far short of better organized rivals. This time, his advisers are putting together a more serious effort that taps into voters’ frustrations with Washington and the fears about the economy.

His aides are working within the system instead of against it. For instance, Paul’s base camp for the Iowa straw poll was at the same location Romney used in 2007. Romney won that straw poll after investing heavily from his deep pockets for the prime real estate.

Paul’s campaign notes that it won more votes this year than Romney won four years ago during his first bid for the GOP nomination. This year, Romney didn’t actively campaign during the straw poll; instead, he is looking at a campaign launch in New Hampshire, which hosts the first primary after Iowa’s leadoff caucuses.

Still, Paul finds himself outside the bounds of traditional Republicans. His opposition to the wars in Iraq and Afghanistan defines him as a dove. His skepticism toward the Federal Reserve has spooked Wall Street. And his libertarian views on gay rights draw the ire of social conservatives.

He also tweaks Republicans on foreign policy, arguing it isn’t the United States’ role to police Iran’s nuclear program or to enforce an embargo with Cuba.

“Iran is not Iceland, Ron,” former Sen. Rick Santorum told Paul during Thursday’s debate.

Paul also proves a reliable foil for Democrats.

“In previous presidential campaigns, we might have chalked extreme fringe-type candidates like Michele Bachmann and Ron Paul as an anomaly, (and) the Ames straw poll didn’t mean as much,” said Rep. Debbie Wasserman Schultz of Florida, chairwoman of the Democratic National Committee.

“But we’re looking at the core of the Republican Party now. The heart of the Republican Party is the extreme right wing,” she told CNN.

Paul, a 75-year-old doctor by training, is not backing down.

“These straw poll results, our growing poll numbers and our strong fundraising show that our message is resonating with Iowans and Americans everywhere,” campaign chairman Jesse Benton said. “Our message was the same in 2007 as it is now in 2011, but this time we have quadrupled our support. That means our message is spreading, our support is surging and people are taking notice.”

Obama Privately tells Banks: U.S. Not Defaulting

By
Fox Business
July 26, 2011

While officials from the Obama Administration raised their rhetoric over the weekend about the possibility of a debt default if the debt ceiling isn’t raised, they privately have been telling top executives at major U.S. banks that such an event won’t happen, FOX Business has learned.

In a series of phone calls, administration officials have told bankers that the administration will not allow a default to happen even if the debt cap isn’t raised by the August 2 date Treasury Secretary Tim Geithner says the government will run out of money to pay all its bills, including obligations to bond holders. Geithner made the rounds on the Sunday talk shows saying a default is imminent if the debt ceiling isn’t raised, and President Obama issued a similar warning during a Friday press conference after budget negotiations with House Republicans broke down.

While the negotiations to craft a budget remain at an impasse, Republicans and Democrats on Monday began crafting their own plans to cut spending that could lead to an agreement to raise the debt ceiling. It’s unclear if a broad agreement can be reached any time soon, but even if a deal is struck, a complicating issue for lawmakers and the administration is the possibility of a downgrade to the US debt rating, which would cut the triple-A rating on the nation’s debt to a lower level.

Major ratings firms — namely Standard & Poor’s and Moody’s — have said even if the country raises the debt ceiling and doesn’t default, there’s a strong likelihood that the triple-A bond rating will be cut to double-A unless a budget can be crafted that results in $4 trillion in savings, the result of the massive debt load the country has accumulated in recent years. The nation’s outstanding debt is more than $14 trillion.

A senior banking official told FOX Business that administration officials have provided guidance to them that even though a default is off the table, a downgrade “is a real possibility for no other reason than S&P and Moody’s have to cover (themselves) since they’ve been speaking out on the debt cap so much.”

This guidance is a big reason why Wall Street has largely dismissed the possibility of default, and though the markets have been jittery amid the talk of default, they haven’t imploded as would be the case, many economists fear, if the nation missed a payment on its debt.

Read Full Article…

Federal Reserve Preparing for U.S. Default

by Tyler Durden
Zero Hedge
July 21, 2011

That giant whooshing, and humming, sound you hear are all the printers at the basement of Marriner Eccles getting refills and start the warm up process. Because according to the Fed Charles Plosser the Federal Reserve is actively preparing for the possibility that the United States could default. Which can only mean one thing: an immediate paradrop of millions of $100 bricks to every man woman and child in the US since as we all know by know Tim Geithner has repeatedly confirmed the Treasury has absolutely no default plans. None.

Per Reuters:

Philadelphia Federal Reserve Bank President Charles Plosser said the Fed has for the past few months been working closely with Treasury, ironing out what to do if the world’s biggest economy runs out of cash on August 2.

“We are in contingency planning mode,” Plosser told Reuters in an interview at the regional central bank’s headquarters in Philadelphia. “We are all engaged … It’s a very active process.”

Plosser said his “gut feeling” was that President Barack Obama and Congress will come to an agreement to increase the Treasury’s borrowing authority in time to avert a default on government obligations.

And in addition to the warming up, the Fed is also engaging in the following:

The Fed effectively acts as the Treasury’s bank — it clears the government’s checks to everyone from social security recipients to government workers.

“We are developing processes and procedures by which the Treasury communicates to us what we are going to do,” Plosser said, adding that the task was manageable. “How the Fed is going to go about clearing government checks. Which ones are going to be good? Which ones are not going to be good?”

“There are a lot of people working on what we would do and how we would do it,” he said.

Plosser added that there are difficult questions that the Fed itself had to grapple with.

The Fed lends to banks at the discount window against good collateral. But what happens if U.S. Treasuries no longer fit that bill?

“Do we treat them as if they didn’t default, in which case we would be saying we are pretending it never happened? Or do we treat them as if they defaulted and don’t lend against them?” Plosser said. “Those are more policy questions.”s at the basement of Marriner Eccles getting refills and start the warm up process.

We urge the secretary of tax evasion to take a hint or two from his “Treasury Bank” brethren and start contemplating a Plan B since we now stand less than 48 hours away from D-Hour and there is still no consensus.