Bradley Jansen (editor)


Bradley Jansen is the director of the Center for Financial Privacy and Human Rights, part of the Liberty and Privacy Network, a Washington DC-based non-profit founded in 2005 to defend privacy, civil liberties and market economics. He is an adjunct scholar at the Competitive Enterprise Institute. Previously at the Free Congress Foundation, Jansen safeguarded privacy and other Constitutional liberties including testifying before Congress on the USA PATRIOT Act proposal, National ID, and other issues. While working for U.S. Rep. Ron Paul, he initiated and lead opposition to the "Know Your Customer" proposal. Jansen holds a B.A. in International Studies from Miami University (Ohio), learned Spanish at the Pontificia Universidad Javeriana (Colombia), and with advanced studies in economic history at Universidad Católica de Valparaíso (Chile) and law and economics at George Mason University School of Law.

He is a columnist with The Daily Caller, The Huffington Post and Nolan Chart.


Reclaim Your Liberty Dollars

by Bradley Jansen March 13th, 2015 11:15 am

Our friend Bernard von NotHaus sent out an email yesterday advising everyone who had their Liberty Dollars confiscated by the Feds to petition to get them back.  Larry White offered Congressional testimony on the issue; read about it in his post here praising currency competition.  Also, Kurt Schuler posted about the case and a Forbes article with another post here on free banking referencing the Liberty Dollar and another one pointing out a few of Larry White's papers which also get into the Liberty Dollar case.

There are lots of posts on the similar precedent of the e-gold case (with more background on the e-gold case from me farther back here and on forfeiture here).  Unfortunately, those depositors didn't get their gold back from the Feds after their accounts were confiscated.  This time the Department of Justice may give some Liberty Dollar claimants an opportunity the e-gold ones didn't.

So with no further ado, here is the pertinent information from the Liberty Dollar newsletter:


New Developments from the DOJ regarding your Petition to recover your wrongfully seized Liberty Dollar property. 

Dear Liberty Dollar Supporters!

A Liberty Dollar Supporter received this text in an email yesterday.


"Enclosed you will find the Amended Preliminary Order of Forfeiture in the criminal case in which Bernard von NotHaus has now been convicted. Also enclosed is a Notice informing you of how you must go about filing a petition with the court if you think that you have a forfeiture interest in any of the forfeited property.

Because you have previously contacted this office by email and did not include a postal address, this notice is being sent by email. However, this office will not accept any further communications by email. All communications must be by postal mail at the address given in the Notice." 

Thomas R. Ascik
Assistant United States Attorney
100 Otis Street
Asheville, North Carolina 28801
828-271-4661 - main
828-271-4670 - fx


Please read these two documents very carefully before filing your Petition:

 and the

Please make special note that the Notice of Forfeiture requires all Claimants to file TWO COPIES OF YOUR PETITON. One address to the Court and that address is on the Sample Petition I already sent to you.
And send a SECOND COPY sent to:
Thomas R. Ascik
Assistant United States Attorney
100 Otis Street
Asheville, North Carolina 28801
Both copies must be NOTARIZED.

I will continue to keep you advised of any changes or developments regarding this Gordian Knot!

I will also do my best to be of assistance. But please don't email me unless you must.
I am swamped!

With the right work, you should get your property back.

I am deeply grateful for your kind support and concern.

Bernard von NotHaus
Monetary Architect

That email followed this one sounding the call to pass the word for anyone to literally exercise their First Amendment right to To Petition the Government for a Redress of Grievances!


You Must Take Prompt Action Before Your Wrongfully Seized Liberty Dollars Are Forfeited and Gone Forever!

Dear Liberty Dollar Supporters!

I strongly urge you to send this message out to your fellow Liberty Dollar supporters, email list and your news groups so as many innocent third parties as possible can get their wrongfully seized Liberty Dollar property back as possible. 

ATTENTION: I was just informed that the DOJ is planning to mail notification to 1000 to 2000 potential claimants (out of 10,000+ potential claimants), regarding their property on March 10. Don't wait! Start getting your info together now. If you are not one of the "lucky ones" to receive a letter from the DOJ then file your Petition as per this email.

After six months of strenuous effort to find the way for you to get your wrongfully seized Liberty Dollar property back, I can report that the results are mixed: There is both good news and bad news.

Here's the good news: You can get your property back. The bad news is that each individual claimant must file a separate Petition claiming their property. The filing process is tedious and requires excellent records of your confiscated Liberty Dollars and when you bought them. I know this will be difficult for many of you, especially if you only have a few Liberty Dollars.

Sadly, there is nothing more l can do to help you other than to provide the attached sample Petition, the instructions for your Petition below and a copy of the statutory language from the Cornell Law School.

Going forward, my efforts will remain focused on exposing this terrible travesty and to do what I can to bring sanity and stability back to the money we all depend upon.

DO NOT let the Federal "Justice" System victimize you and steal your property.

Now, the time has finally come for you to take action to prevent the government from forfeiting (i.e. stealing) your innocent third party Liberty Dollar property. Regardless of how wrong this may seem to you or what a pain it may be, if you don't take action, you WILL LOSE YOUR PROPERTY. Recovering your property is the closing act of the long nine year drama regarding the Liberty Dollar warning, raid, arrest and conviction of BVNH.

Please note that only metal property (gold, silver, platinum or copper) can be returned for:
1. Paper warehouse receipts
2. Digital warehouse receipts that were electronically held in your online account
3. Your personal property was held at the Liberty Dollar Fulfillment Office.
Or cash repayment for unfulfilled orders could be repaid from the Liberty Services bank account that was seized.

Now that Judge Voorhees has entered a Preliminary Order of Forfeiture, he will Order an announcement to be posted and/or mailed regarding an Ancillary Hearing for all third party claimants. Each claimant will be permitted to testify, call witnesses and present evidence to establish their claim for their wrongfully seized Liberty Dollar property.
The recovery process begins with each Claimant filing a Petition with the Court.

Please note a sample Petition is attached.

Please write your Statement in plain English that includes:
2. Statement: "I, your name, hereby state under oath and penalty of perjury that the follow information is true and correct to the best of my knowledge."
3. Your mailing address
4. List of properties with a description and quantity of each (i.e. so many $10 one ounce paper Silver Certificate warehouse receipts, one $500 paper Gold Certificate warehouse receipt and the latest balance in your ELD digital warehouse receipt account)
5. The date of purchase of each property if known. If you don't know the date of each purchase, state: "I bought such and such property on or about… and include date or year." As all ELD accounts are closed simply use the closing balance of your ELD account if indeed that is possible. All digital warehouse receipts are at the $20 Silver Base)
6. State the number of ounces for each type of property
7. State that you bought your property with your own money and were not party to any criminal activity for which the property was seized.
8. State you are a bona fide purchaser for value of the right, title, or interest in the property and at the time of purchase was reasonably without cause to believe that the property would be subject to forfeiture.
9. It is very important to show proof of your purchase and substantiate your claim with any paper work or records that you have. Please attach any and all proof of your purchases and the value of your digital Liberty Dollar account. Of course that is very difficult for your digital Liberty Dollar account that is not available, a great amount of time has transpired or you may have received the paper warehouse receipts in trade, barter or commerce. DO NOT surrender your paper warehouse receipts until you a absolutely sure you are going to receive the gold and silver.
10. Point out that you have been waiting for a very long time and request an urgent resolution of this matter.
11. State that you are an innocent third Claimant and demand your property be returned to you without any cost to you as all wrongful seizures are to be returned at no cost to Claimants.
12. MOST IMPORTANT: Editorializing about the case, your property or any monetary issue would be out of place and a serious deterrent to recovering your property.

Please note a sample Petition is attached.

The 30 day time period for you to file the Petition will begin very shortly. Regardless if you receive a letter or read the Official Notice published in the local newspaper in Charlotte, your Petition must be received within the 30 days after the Notice is published. One petition has already be filed and recorded as Document 294. Each Petition will be identified with its own Doc number. PLEASE DO NOT WAIT. Start now! Start looking for your records and working on your Petition now! Please note I am barred from assisting with anyone's Petition.

Remember: Your Petition must be Notarized. 

Your notarized Petition must be filed with the Federal Court in Charlotte, North Carolina and I strongly recommend your Petition be sent with tracking that confirms it was sent and received. For that reason, I suggest you mail your Petition via US Priority Mail and retain the receipt with the tracking number for your records. Please note the Court's address is included on the Sample Petition.

I encourage you to file a Petition - regardless of how little was taken from you. This the final act of the Liberty Dollar and every Petition is a show of support and very important.

Please keep a copy of the Notarized Petition for your records.

I know that this has been a very long exhausting experience. I know you have been seriously wronged by the Federal government. We have all suffered for taking legal citizen action to rightfully and peacefully return our country's once great monetary system to its original founding principles. It is now time to get your property back.

I am doing my best to be of assistance. But please don't email me unless you must. I am swamped!

Thanks again for your outstanding action for those ideals we share in common.

I am deeply grateful for your kind support and concern.

I apologize for having failed you. Good luck!

Bernard von NotHaus
Monetary Architect


Good luck to all of our Liberty Dollar friends!

UPDATE:  Bernard corrects me (thanks, Bernard!):

Thanks Bradley!  Well done... Except that some e-gold account holders did get reimbursed in USD for their e-gold.  I was one and Richard Timberlake was another... Actually there were quite a few who were able to jump through a pile of hoops and actually get their money (not gold) back.  Bernard


CMRE Dinner March 25th in NYC

by Bradley Jansen March 13th, 2015 2:26 am

In another bit of housekeeping, I wanted to point out that free banking blogger extraordinaire George Selgin and fellow blogger here Walker Todd will be joining Thomas Hoenig, vice chairman of the FDIC and formerly president of the Federal Reserve BANK of Kansas City, at the next Committee for Monetary Reform and Education (CMRE) dinner.

Other announced speakers include John Browne, former Conservative MP, advisor to Margaret Thatcher, and vice-president of the UKIP party and Edwin Vieira, Constitutional scholar and long-time CMRE contributor.  For more information and to register and buy tickets online, please go here:


CMRE dinner

On a personal note, I'll be helping at the door so please feel free to introduce yourself and mention you heard about it here!


Thanksgiving: a celebration American currency competition

by Bradley Jansen November 27th, 2014 8:14 am

Happy Thanksgiving to all of my fellow free bankers out there!

Today is our biggest secular national holiday.  Not everyone celebrates Christmas or Easter much less other national holidays like Memorial Day or Labor Day, but I don't know anyone who doesn't like Thanksgiving.  So, as we sit around eating turkey or some other dinner of thanks, remember also that we acknowledge the beginning of native currency competition in America.  While there was always competing use of different national currencies (basically different denominations and weights of gold and silver) in what would become the American colonies, and in that sense America was founding on free banking principles, Thanksgiving gives us a time to remember the birth of a truly American free banking experience.


Yes, wampum was, arguably, the first native American free banking episode.  Here is the description of the birth of the first native American currency, wampum, from the 1883 Ancient Landmarks of Plymouth by William T. Davis, the former president of the Pilgrim Society (pp. 57-9):

No legal-tender scheme, in these later days, has been bolder in its conception, or more successful in its career than that of the Pilgrim Fathers, which, with the shells of the shore, relieved their community from debt, and established on a permanent basis the wealth and prosperity of New England.  Many of the Indian tribes not acquainted with the use of wampum, were instructed in its use and before the enterprise could be successfully carried out, and adopted it greedily when when it was fully understood.  This currency of the early days was made from purple and white parts of the quad-haug shell, round, about a sixteenth of an inch in thickness, and a quarter of an inch in diameter, with a hole in the middle for stringing on strings of bark or hemp, the purple and white alternating on the string, the purple of double the value of the white, and the while value at five shillings per fathom.


Wampum string

[Quahog and whelk wampum made by Elizabeth James Perry (Aquinnah Wampanoag/Eastern Band Cherokee), c. 2009; image courtesy of Wikipedia]

Unfortunately, the success was relatively short-lived.  Here is a follow up to that development in the Rhode Island colony by Oliver Payson Fuller, The Hisory of Warwick Rhode Island: Settlement in 1642 to the Present Time published in 1875 (pp. 59 and 70) explaining,

The currency of the colony, wampum page, which had been in use from the earlier settlement, had fallen so low in value that was declared to be no longer legal tender.  The other colonies had abandoned it some time previously.  Massachusetts had commenced the coining of silver ten years before...

As there was no restriction in relation to the manufacture of peace, a large amount came early into circulation, and as early as 1649, a law was passed lowering the standard of black page one third, and four instead of three per penny was the legal rate.

There were even differences between new Coke currency and classic English currency even of the same name, explains Fuller, p. 70, "Forty shillings of the New England currency was equivalent to thirty shillings of English currency."

I guess this shows that inflation is as American as apple pie--though some things are definitely sweeter than inflation.



Phil Crane and Gold

by Bradley Jansen November 11th, 2014 1:18 pm

Former US Representative Phil Crane passed away this weekend.  Readers of this blog should remember him as the author of the legislation to re-legalize monetary gold ownership in 1974.

Richard Viguerie's Conservative HQ writes:

In the 1960s and 70s Phil Crane, along with Bob Dornan, Dr. Ron Paul, John Ashbrook, senators Jesse Helms and Strom Thurmond were among the leaders of the conservative movement who challenged not only the Democrats, but the Republican establishment as well. . .

Although his legislative record was one of principled conservatism – over his long career, he got a 99 percent rating from the American Conservative Union – and he authored the 1974 legislation permitting the private ownership of gold, these things are again, somewhat forgotten, but the Republican Study Committee he founded lives on to affect legislation and what happens on Capitol Hill every day.

David L. Ganz in his book "The Essential Guide to Investing in Precious Metals: How to begin, build and maintain a properly diversified portfolio" related the short history of how Rep. Crane was able to reverse the ban on gold and move us towards monetary freedom (p. 65):

Starting in the early 1970s, a group of "gold bugs" began to advocate private gold ownership rights and eventually, they found the ear of some congressmen and senators who bought into their fairness theory and the claimed illegality of the gold seizures and recalls of the 1930s.

In a truly bizarre episode, they tacked a resolution allowing for private gold ownership onto the foreign aid package that the Nixon Administration wanted.  Presidential vetoes were threatened and an alarmist attitude prevailed at the Main Treasury building.

The foreign aid bill with its non-germane gold ownership clause finally made it to a vote in which conservative members such as Rep. Phil Crane, R-Ill., and others voted with liberal Democrats.  Crane said to me later it was the only foreign aid bill that he voted for in his 35-year congressional career.

His rationale: it was more important to get private gold ownership than argue the vagaries of a single year's foreign aid package.

Congressman Ron Paul's Freedom Under Siege similarly credits Congressman Phil Crane and explains a bit more about the general context with Howard Segermark and Sen. Jesse Helms re-legalizing gold clause contracts.

Bruce Bartlett, like me a former staffer for Rep. Ron Paul, shares the story that Congressman Phil Crane shared with him about his visit to Ft. Knox and inspection of the gold there on his blog here.

Although not yet old enough to vote, I supported Congressman Crane in his 1980 presidential run (losing, of course, to Ronald Reagan) and was a big fan of his.  Soon after I started working as the monetary policy staffer of Congressman Paul in 1997, I met the chief of staff, I think it was, for Congressman Crane.  I told him I was a big fan and brought up the gold issue with him.  He told me that he and his boss still favored a return to a gold standard and lamented that so few were interested in these issues anymore.

I'm glad Phil Crane lived long enough to see a rebirth in interest in gold and monetary alternatives and a growing skepticism towards the Federal Reserve.


House Passes Audit the Fed Bill

by Bradley Jansen September 17th, 2014 2:49 pm

Today the US House of Representatives passed HR 24, the Audit the Fed bill by a vote of 333-24 under the suspension calendar (requiring a ⅔ majority to pass).

House of the Clerk floor summary here:

1:12:15 P.M. H.R. 24 Considered as unfinished business. H.R. 24 — "To require a full audit of the Board of Governors of the Federal Reserve System and the Federal reserve banks by the Comptroller General of the United States, and for other purposes."
1:44:04 P.M. H.R. 24 On motion to suspend the rules and pass the bill, as amended Agreed to by the Yeas and Nays: (2/3 required): 333 - 92 (Roll no. 504).
1:44:04 P.M. H.R. 24 Motion to reconsider laid on the table Agreed to without objection.

The roll call is here to see how your Representative voted:

All Republicans voted "Aye" except for Rep. Campbell (and four not voting) along with a majority of the Democrats (but well less than ⅔ of their number) with 106 in favor 91 opposed and two not voting.

It would be highly unlikely for the Senate to take up the bill this late in the calendar.



Free Banking and Economic Growth in Lower Canada, 1817-1851

by Bradley Jansen August 19th, 2014 3:20 pm

Mathieu Bédard and Vincent Geloso have a paper out on SSRN here, "Free Banking and Economic Growth in Lower Canada, 1817-1851":

Says the abstract:

Generally, the historical literature presents the period from 1817 to 1851 in Lower Canada (modern day Québec) as one of negative economic growth. This period also coincides with the rise of free banking in the colony. In this paper we propose to study the effects of free banking on economic growth using theoretical and empirical validations to study the issue of whether or not economic growth was negative. First of all, using monetary identities, we propose that given the increase in the stock of money and the reduction in the general price level, there must have been a positive rate of economic growth during the period. We also provide complementary evidence drawn from wages that living standards were increasing. It was hence impossible for growth to have been negative. Secondly, we propose that the rise of privately issued paper money under free banking in the colony had the effect of mitigating the problem of the abundance of poor quality coins in circulation which resulted from legal tender legislation. It also had the effect of facilitating credit networks and exchange. We link this conclusion to the emergence of free banking which must have been an important contributing factor. Although we cannot perfectly quantity the effect of free banking on economic growth in Lower Canada, we can be certain that its effect on growth was clearly positive.


House Committee Passes Audit the Fed Bill

by Bradley Jansen July 24th, 2014 5:34 pm

The House of Representatives Committee on Oversight & Government Reform today passed by voice vote HR 24, the "Federal Reserve Transparence Act of 2014".  More background and video of the hearing available here.


Text as passed here:



Federal Reserve Transparence Act original text



EDIT:  The text of the substitute bill considered and passed includes some formatting and technical changes as well as some substantive ones:





The substitute passed includes some substantive changes.

In the original text, Section 2 (b) (c) is changed from

"REPEAL OF CERTAIN LIMITATIONS.—Subsection 20  (b) of section 714 of title 31, United States Code, is 21  amended by striking the second sentence.

To this:

(c) REPEAL OF CERTAIN LIMITATIONS.—Subsection (b) of section 714 of title 31, United States Code, is amended by striking all after ‘‘in writing.’’.

I don't know offhand the significance of this change.  Also from this:

(d) TECHNICAL AND CONFORMING AMENDMENT.— Section 714 of title 31, United States Code, is amended by striking subsection (f).

to this:

2. 23  Section 714 of title 31, United States Code, is amended— (1) in subsection (d)(3)—
(A) in subparagraph (A)—

(i) by striking ‘‘or (f)’’;

(ii) in clause (i), by striking ‘‘or (f)’’; and

(iii) in clause (ii), by striking ‘‘or (f)’’; and

(B) in subparagraph (C), by striking ‘‘or (f)’’; and

(2) by striking subsection (f)

Also, the  "SEC. 3. AUDIT OF LOAN FILE REVIEWS REQUIRED BY ENFORCEMENT ACTIONS" has been struck from the original text:

SEC. 3. AUDIT OF LOAN FILE REVIEWS REQUIRED BY EN- FORCEMENT ACTIONS. (a) IN GENERAL.—The Comptroller General of the United States shall conduct an audit of the review of loan files of homeowners in foreclosure in 2009 or 2010, re- quired as part of the enforcement actions taken by the Board of Governors of the Federal Reserve System against supervised financial institutions. (b) CONTENT OF AUDIT.—The audit carried out pur- suant to subsection (a) shall consider, at a minimum— (1) the guidance given by the Board of Gov- ernors of the Federal Reserve System to inde- pendent consultants retained by the supervised fi- nancial institutions regarding the procedures to be followed in conducting the file reviews;

(2) the factors considered by independent con- 2 sultants when evaluating loan files; 3 (3) the results obtained by the independent con- 4 sultants pursuant to those reviews; 5 (4) the determinations made by the independent 6 consultants regarding the nature and extent of fi- 7 nancial injury sustained by each homeowner as well 8 as the level and type of remediation offered to each 9 homeowner; and 10 (5) the specific measures taken by the inde- 11 pendent consultants to verify, confirm, or rebut the 12 assertions and representations made by supervised 13 financial institutions regarding the contents of loan 14 files and the extent of financial injury to home- 15 owners. 16 (c) REPORT.—Not later than the end of the 6-month 17 period beginning on the date of the enactment of this Act, 18 the Comptroller General shall issue a report to the Con- 19 gress containing all findings and determinations made in 20 carrying out the audit required under subsection (a).


 Again, I'm not sure offhand what, if any, are the significance of these changes, but I do know the devil is in the details! 

Audit the Fed bill


NY Regs Threaten Bitcoin and Digital Currencies

by Bradley Jansen July 23rd, 2014 12:15 pm

The New York Department of Financial Services (NYDFS) has issued new proposed proposed BitLicense rules and regulations that would curtail not encourage digital currencies like Bitcoin.

Many years ago when I first started in Rep. Ron Paul's office, I initiated and led a fight against a similar anti-money laundering proposal called "Know Your Customer" which would have increased regulations, violated financial privacy and threatened currency competition. Lots of background on that fight here.

I and other bloggers here have written a lot on how the anti-money laundering regulations do more to inhibit currency competition now than legal tender laws do. Lots of background here. Check out Larry White's talk about these issues at Cato too:

The Chamber of Digital Commerce is calling on the Bitcoin community to submit comments to the NYDFS. Instructions on how to submit comments can be found on the NYDFS website at  More on the new Chamber of Digital Commerce here.

A new digital currency trade association is fighting the regulations. Their press release can be read here:

“One egregious aspect is that the NYDFS is only giving 45 days to comment, which is severely inadequate to proposed regulations of this scope” said Perianne Boring, President of the Digital Chamber. “We are requesting that the NYDFS extend the comment period through the end of 2014, to allow the industry adequate time to properly review and respond.”

When fighting the KYC proposal, I generated 300,000 comments against the proposal (with only 105 in favor). Let's organize those groups and experts interested in these issues to figure out how to fix this proposal now: contact me at bjansen @ and stay tuned here if interested in joining this fight!

Kudos for the NYDFS for being pro-active to secure a legal path to digital currency use, but the proposal as written would do much more harm than good. Let's hope they are open to making sure they get this right and don't end up shifting digital currencies and other financial innovations away from New York. Even more thanks go out to Perianne Boring for her efforts!

Now is the time to stand up and make the world (well, at least New York) safe for digital currencies and alternatives to the Fed!


EDIT: the new proposed rules are now online here (scroll to page 14):


The National Law Review has a post here.


Blame the Fed for Reagan's Spending

by Bradley Jansen April 24th, 2014 5:11 pm

A nice debate has started brewing about the records of Presidents Jimmy Carter versus Ronald Reagan on spending--thanks to US Sen. Rand Paul who again seems to be setting the terms of the debate.

Mother Jones has published a video of Rand taking issue of spending rising faster under Reagan that it did under Carter.

MSNBC has publicized the video through an interesting story here saying, in part:

It’s worth emphasizing, in case details like these make a difference, that Paul’s criticism of Reagan’s fiscal record happened to be accurate. The budget deficits were smaller under Carter than Reagan. Federal spending grew slower under Carter than Reagan, too.
But to put it mildly, Republicans don’t want to hear any of this, and they tend to be thoroughly unhappy when anyone compares Reagan unfavorably to Carter, even when the analysis is true.
before adding:
After Corn’s piece ran, Paul’s office issued a statement to Mother Jones, noting, “I have always been and continue to be a great supporter of Ronald Reagan’s tax cuts and the millions of jobs they created.”
Reason has now got into the act with a story here.  They basically confirm that Rand's facts are right before concluding, "The short version: Reagan spent like a drunken sailor and skipped out on the bill."
They even include a handy chart from Veronique de Rugy at Mercatus from here report here
Reason sums up Veronique de Rugy's (in full disclosure, she is part of the Board of the think tank that runs this blog) numbers:
As de Rugy does the math, Carter increased real spending 17 percent over the last budget of his predecessor, Gerald Ford. Over two terms, Reagan increased spending by 22 percent over Carter's final budget. On an annualized basis, then, Carter grew spending by 4.25 precent a year, while Reagan grew it by 2.75 percent. However, when expressed as a percentage of GDP, spending under Carter averaged 20.6 percent per year while Reagan averaged 21.6 percent. Spending typically really gears up in a second-term president's final years, so it's plausible to theorize that had Carter managed to stick around for eight years, he might have equaled or surpassed what the real-world Reagan managed.

For those still reading along, thanks, and you might be asking, what if anything does this have to do with free banking?  Well, I would like to posit that it is at least tangentially related in that from what I remember from the early days of the Reagan Administration, he cut a deal with Congress  on spending that would have had nominal growth but real cuts based on then projected inflation.  The blame then goes to Federal Reserve Chairman Volcker for slaying the inflation dragon much faster than anticipated so that the projected real spending cuts became real spending increases.

The St. Louis Fed published a paper by Keith W. Carlson in January/February 1989 entitled "Federal Budget Trends and the 1981 Reagan Economic Plan" (pdf) explaining that "prices were generally increasing at double digit rates."  The paper goes on to illuminate my point:

The 1981 administration forecast for inflation for the 1980—86 period was a 7.1 per-cent annual rate; the actual inflation rate during this period was 5.1 percent.

So, in conclusion, yes, Rand Paul is right to raise spending as an important economic issue and take sacred cows out for fair examination--but let's not forget that the Federal Reserve deserves its share of blame both for confusing economic planners as well as monetizing budget deficits.


White and Selgin at Heritage on the Fed tomorrow

by Bradley Jansen March 18th, 2014 2:36 pm

Larry White and George Selgin and Jerry Dwyer will be speaking at the Heritage Foundation tomorrow.

The Federal Reserve at 100: How Well Has It Done?

Has the Federal Reserve functioned as it was intended? How well has the Fed managed the economy and calmed business cycles? Do its successes outnumber and outweigh its failures? Join us as leading experts address these and other important questions.

RSVP to attend in person or just watch online.

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