You are here

GATA conference is rebroadcast on C-SPAN

Section: Daily Dispatches

2:51p ET Sunday, February 16, 2002

Dear Friend of GATA and Gold:

U.S. Rep. Ron Paul put a statement into the
Congressional Record last Thursday to introduce
his Monetary Freedom and Accountability Act,
requiring the president and treasury secretary
to get Congress' approval before intervening in
the gold market. That statement made
substantial reference to GATA's work and
appended the recent article in Insight magazine
by Kelly Patricia O'Meara, which we've already
sent to you.

Paul's statement in the Congressional Record
is below. GATA supporters in the United States
should send it to their senators and
representatives and ask for favorable

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * * * * * * * * * * * * * * * * * * *

U.S. House of Representatives
February 14, 2002
a href=

Statement by U.S. Rep. Ron Paul of Texas.

* *

Mr. Speaker, I rise to introduce the Monetary
Freedom and Accountability Act. This simple
bill takes a step toward restoring Congress'
constitutional authority over U.S. monetary
policy by requiring congressional approval
before the president or the treasury
secretary buys or sells gold.

Federal dealings in the gold market have the
potential to seriously disrupt the free
market by either artificially inflating or
deflating the price of gold. Given gold's
importance to America's (and the world's)
monetary system, any federal interference in
the gold market will have ripple effects
through the entire economy.

For example, if the government were to
intervene to artificially lower the price of
gold, the result would be to hide the true
effects of an inflationary policy until the
damage was too severe to remain out of the
public eye. By artificially deflating the
price of gold, federal intervention in the
gold market can reduce the values of private
gold holdings, adversely affecting millions
of investors. These investors rely on their
gold holdings to protect them from the
effects of our misguided fiat currency

Federal dealings in gold can also adversely
affect those countries with large gold mines,
many of which are currently ravished by
extreme poverty.

Mr. Speaker, restoring a vibrant gold market
could do more than any foreign aid program to
restore economic growth to those areas.

While the Treasury Department denies that it
is dealing in gold, the Gold Anti-Trust
Action Committee (GATA) has uncovered
evidence suggesting that the Federal Reserve
and the Treasury, operating through the
Exchange Stabilization Fund and in
cooperation with major banks and the
International Monetary Fund, have been
interfering in the gold market with the goal
of lowering the price of gold. The purpose of
this policy has been to disguise the true
effects of the monetary bubble responsible
for the artificial prosperity of the 1990s,
and to protect the politically powerful banks
that are heavy invested in gold derivatives.

GATA believes that federal actions to drive
down the price of gold help protect the
profits of these banks at the expense of
investors, consumers, and taxpayers around
the world.

GATA has also produced evidence that American
officials are involved in gold transactions.

Alan Greenspan himself referred to the
federal government's power to manipulate the
price of gold at hearings before the House
Banking Committee and the Senate Agricultural
Committee in July 1998: quot;Nor can private
counterparts restrict supplies of gold,
another commodity whose derivatives are often
traded over-the-counter, where central banks
stand ready to lease gold in increasing
quantities should the price rise.quot;

Mr. Speaker, in order to allow my colleagues
to learn more about this issue, I am
enclosing quot;All that Glitters is Not Goldquot; by
Kelly Patricia O'Meara, an investigative
reporter from Insight magazine. This article
explains in detail GATA's allegations of
federal involvement in the gold market.

Mr. Speaker, while I certainly share GATA's
concerns over the effects of federal dealings
in the gold market, my bill in no way
interferes with the ability of the federal
government to buy or sell gold. It simply
requires that before the executive branch
engages in such transactions, Congress has
the chance to review it, debate it, and
approve it.

Given the tremendous effects on the American
economy from federal dealings in the gold
market, it certainly is reasonable that the
people's representatives have a role in
approving these transactions, especially
since Congress has a neglected but vital
constitutional role in overseeing monetary
policy. Therefore, I urge all my colleagues
to stand up for sound economics, open
government, and Congress' constitutional role
in monetary policy by co-sponsoring the
Monetary Freedom and Accountability Act.