Rick Perry On Ben Bernanke: “We Would Treat Him Pretty Ugly Down In Texas”
During a campaign appearance in Iowa yesterday, Rick Perry had some not-so-kind words about the Chairman of the Federal Reserve Board that have raised eyebrows even among some on the right:
Texas Gov. Rick Perry, making his maiden campaign swing in Iowa after jumping into the race for the Republican presidential nomination, suggested Monday night that Federal Reserve Chairman Ben Bernanke would be committing an act of treason by printing more money between now and November 2012.
Responding to a question about the Federal Reserve at a campaign event in Cedar Rapids, Perry said: “If this guy prints more money between now and the election, I don’t know what y’all would do to him in Iowa, but we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in American history is almost treacherous, or treasonous, in my opinion.”
Perry continued by saying that printing more money would be “devaluing the dollar in your pocket, and we cannot afford that. We have to learn the lessons of the past three years that they’ve been devastating. The president of the United States has conducted an experiment on the American economy for almost three years, and it has gone tragically wrong, and we need to send him a clear message in November 2012 that new leadership is coming.”
Via Think Progress, here’s the video:
There was, as I said, some immediate negative reaction on the right. Former Bush Administration spokesman Tony Fratto called Perry’s remarks “inappropriate and unpresidential.” Over at Commentary, John Podhoretz referred to it as a “serious unforced error” on Perry’s part:
I think it’s pretty clear from the clip that Perry was trying to play folksy straight-talkin’ populist guy while taking up a complicated issue, using colorful dirt-kicker language to connect to his al-fresco audience as he might in his home town of Paint Creek. And in the early going on Twitter, I suggested the harrumphers were knowingly making a mountain out of a molehill to bring him down a notch. I was wrong.
He’s trying to be the next president, and he needs to be judged on that standard. What Perry did was make a thoughtless blunder, an unforced error; we’re now going to spend a couple of days discussing whether he was summoning violence on Ben Bernanke’s head or not, which is of absolutely no use to Perry. He is, or was, moments away from becoming the race’s frontrunner, and what is in his interest is to harness the excitement of his late entry with qualities of leadership and control that will rally the majority of Republicans unhappy with the choices facing them to his side. Rick Perry made that more difficult today; this was a serious rookie mistake on the national stage.
As Podhoretz goes on to note, there are plenty of serious issues to raise about Federal Reserve policy, starting with its role in the 2001-2007 economic bubble and subsequence collapse. However, suggesting that the Chairman of the Fed is manipulating the money supply for poltiical purposes and hinting that if he ever came to Paint Creek, Texas (why would anyone?), he might be lynched isn’t the way to do it. Unless you’re a caller to Rush Limbaugh’s show, that is.
Does this correlate at all with a D in Economics?
(Whether Bernanke has done everything right is a fair question, but with a little economics you can see that his choices were limited. They still are.)
Having lived a significant part of my life in the South, including a number of years in Texas, I readily dismiss the “treat him pretty ugly” business as cornpone crowd pandering, not a threat of violence. My problem with the statement is that the government has few tools to stimulate the economy: lowering taxes (done, done, and done), lowering interest rates (done), and easing the money supply (ongoing very slowly). Bernanke has few bullets left in the gun and easing money is about it.
Ben Bernanke need to be replace. He supported Obama’s stimulus plan.
So Perry got an “F” in Econ 101.
If Perry had said this alone, you might dismiss the meaning, but when you add “treason” to the mix it’s hard to hide from his imagery. Obama makes great choices in his enemies.
Perry has been in the race for what – 48 hours?
He has:
* said something pretty stupid about military respect for Obama, in an attempt to impune his patriotism…after having mentioned seceding from the nation twice himself.
* made some wild claims about a Texas miracle that no one but rigid right-wing ideologues seem to be able to witness.
* walked back statements about Social Security being a ponzi scheme best left to the States.
* tried to disavow his exectutive order mandate (regulation) for HPV vaccines.
* and as pointed out above…said something pretty stupid about bernanke and treason.
This is going to be a fun election season. Bachmann and Perry and Mitt…oh my!!!
Sounds like Rick Perry’s turn as media darling isn’t going to last very long.
Social Security is a ponzi scheme. Current benefits are being paid out of the payroll taxes of future recipients.
It’s awfully rich for him to be talking about someone else’s actions as being treasonous considering his own comments about secession…
Oh really? So it is an intentional fraud?
@An Interested Party:
Okay, it’s like a Ponzi scheme. Happier?
Stormy, Social Security is insurance, you know, like Allstate or Farmer’s, but better. You may never have the occasion to recoup the premiums you pay to your insurance company, but provided you survive, you will definitely collect your Social Security.
Social Security is definitely not like Allstate or Farmers insurance. The premiums that are paid to Allstate and Farmers are invested in assets that can be liquidated when the need arises to pay out benefits. Social Security funds have not been invested. Social Security revenue has been spent by the Federal Government. The money was spent on current recipients of SS and any excess funds were spent on general expenditures. The Treasury would then give a non-marketable IOU to the Social Security Administration as an accounting gimmick that the SSA could present to the Treasury when there was not enough SS revenue to cover current recipients. Starting in 2010, the SS revenues have not been enough to cover SS beneficiaries, so the SSA brings some non-marketable IOUs to the Treasury as an accounting ploy to claim some of the general tax revenue to cover the short fall in SS expenditures. Insurance companies invest their premiums in assets, the federal government has consumed all of the SS revenues and there are no assets, other than the taxing power of the federal government, to back up social security. That is why SS is like a Ponzi scheme.
@Stormy Dragon:
No, it’s redistribution, just like every other dollar of government spending. Do try to educate yourself.
I didn’t mind it when I found out that Barack Obama started his political career… in the home of a domestic terrorist. And I didn’t mind it when he said that people needed to “bring a gun” to defend him, and “get in people’s faces”, and go out there “and punish our enemies”.
It was also fine and dandy when he said that Republicans were “hostage takers” who were holding “guns up to the heads of American people” (because they rationally decided against raising taxes during a time in which the economy is heading for a double-dip)- and thus it made total sense when his VP apparently said that a bunch of Americans peacefully holding signs were “terrorists”.
But that’s okay because Democrats said all that…
But hyperbole from a Republican- well, that’s totally different. Because it’s from a Republican. Thus, it’s like totally different…
Of course you do. It’s really no big deal for a Republican nominee to accuse the Fed of treason. But if Dan Savage or Al Sharpton had said this, MAN OH MAN.
@That Guy: And I didn’t mind it when he said that people needed to “bring a gun” to defend him, and “get in people’s faces”, and go out there “and punish our enemies”.
Hm. I wonder what I could make Rush Limbaugh, Dick Cheney, George W. Bush or Rick Perry sound like if I simply pulled 3 or 4 words at a time out of context and strung them together.
Mike
@Tom: The premiums that are paid to Allstate and Farmers are invested in assets that can be liquidated when the need arises to pay out benefits.
And where would Social Security be if it had been invested in “assets” over the last 4 years?
Mike
@MBunge:
“Hm. I wonder what I could make Rush Limbaugh, Dick Cheney, George W. Bush or Rick Perry sound like if I simply pulled 3 or 4 words at a time out of context and strung them together.”
All but one of my statements involved President Obama. Thus, if you want to return fire then you should apply it to President Bush. In all honesty, I’d actually be interested to see what you could come up with- Bush (for all of his faults and mistakes) IMHO never treated his American opponents as rudely and childishly as our current occupant has, month after month.
So have at it.
I agree with John Cole. It’s ridiculous to make excuses for this kind of talk. It is a threat of violence. What else would Perry be saying? That Bernanke would get a stern lecture?
That wouldn’t be very “Texas”.
And only conservatives get away with it.
It will be interesting to see how Perry handles questions about this. There’s really no good place for him to go – he risks looking wimpy to his crazy base if he backs off the statement. I think reporters need to ask him exactly what he meant.
I wish the Hon. Gov. LePetomaine would elaborate on what qualifies as “pretty ugly” treatment down there in Paint Creek. Delisting from the social register? Exile to Varnish River? Getting the stink-eye from Hoss? Lynching? The mind boggles.
Mike writes, “And where would Social Security be if it had been invested in “assets” over the last 4 years?”
Mike, in case you didn’t notice Social Security has been around for more than 4 years. It began in January 1937. Do you think the customers at Allstate and Farmers would be in a better position if those companies consumed all of their income instead of investing it in assets? Because that is exactly what the federal government has done. The money has been spent, not invested. Social Security revenues have not been saved and invested. Current revenues were spent on current recipients and any left-over funds were spent on general expenditures. Now, the point has come where current SS revenues do not cover the total amount of current SS recipients. To cover the difference the funds must be paid out of general revenues, which now means less general revenues for other government programs. If you cannot see the benefit of saving and investing for the future over living for the moment and consuming everything in the present, then I really can’t help you.
Well, if you die before you can collect any of it, I guess that would sorta make it like a Ponzi scheme, since you would have paid money into it that you would never have gotten back…but even then, it wouldn’t be fraud, as your spouse or child(ren) would be able to collect that money…so, Social Security isn’t even like a Ponzi scheme…
Well, these statements do have the virtue of being true, as Republicans were in fact playing a game of extortion to get their desired policies enacted…policies which wouldn’t have been enacted any other way…
And the way to fix that would be to simply raise the FICA income cap…
@Tom:
Social Security revenues have not been saved and invested. Current revenues were spent on current recipients and any left-over funds were spent on general expenditures.
@Tom:
Also 100% wrong. The social security trust fund is expected to run a surplus until at least 2017.
@Rick Almeida: Heh. Of course, that’s interest we owe to ourselves. I’m not sure that’s the same as “investing.”
Bernanke better start packing heat. I see a real Hamilton-Burr rivalry starting here.
@James Joyner: I think it absolutely is. X goes in, and X + Y comes out. One can certainly argue that it’s suboptimal (it is, however, the safest investment in the world), but it is absolutely a profitable investment.
Rick,
Social Security ran a $49 billion deficit in 2010 and is expected to have a $46 billion deficit in 2011. Why am I not surprised you don’t know that?
Tell me, Rick, how are these US Treasury Notes paid? These are special issued non-marketable treasury notes mind you. The Trust Fund is full of these special issued treasuries. Payroll tax revenues no longer cover all of the SS expenditures, see above if confused. So, the SSA goes into their lock-box and pulls out some of these special issued treasuries to fund the short fall in revenue. What happens next? Well, the SSA goes to the Treasury to redeem the IOUs. And where does Treasury come up with the revenue for the SSA to make the short fall in payroll tax revenue? Why the Treasury has a bunch of money it pulls in each month from taxes that’s called general revenue. So, the Treasury takes some of the general revenue and gives it to the SSA to pay off the IOU. Like I said, there are no assets that can be liquidated to pay for SS expenditures. That money was used on current consumption. Any short fall in SS revenues to pay for SS expenditures come from general revenues.
@That Guy: ” IMHO [Bush] never treated his American opponents as rudely and childishly as our current occupant has, month after month.”
Really? Well, let’s see – there’s the onslaught against Richard Clarke by administration officials after his testimony before the 9/11 Commission, there’s the Virginia Plame affair, there’s the Swiftboating of John Kerry, there’s the whispering campaign against John McCain during the South Carolina primary accusing him of having fathered an illegitimate black child, and then there’s the Willy Horton affair (oops, that was Bush senior). Bush’s political team was thoroughly thuggish. But I concede that Bush kept his own hands clean, and if you believe in the tooth fairy you can also believe that President Bush would NEVER descend to gutter politics.
@Tom:
Hi Tom,
Your statements are misleading. If one includes interest earned, the Social Security trust fund has no deficit in FY 2010 or 2011, and this despite > 9% unemployment. I refer you to the Social Security Board of Trustees Annual Report for 2011.
US Treasury notes are, of course, paid by tax revenues or by issuing new Treasury notes. That changes nothing.
Really, this is silly – it’s not even worthwhile to talk about Social Security, which could be “fixed” immediately by raising the cap on income subject to FICA.
Nobody wants to talk about Medicare, because that’s the scary thing.
Rick,
It is true that the Social Security Trust Fund receives interest on the special issue treasury notes, but this interest is credited by the Treasury to the trust fund which makes the amount of IOUs in the trust fund greater. But remember that this interest is being credited by the Treasury and the only way for the SSA to redeem that interest is by collecting general revenue from the Treasury. The other way of looking at it is that the payroll tax revenues are actual funds that can be used to pay Social Security recipients. The interest paid on the special issue treasury notes cannot be used by the SSA to pay Social Security recipients, because the interest is not actual funds that can be paid out, but is just a credit to the trust fund. The short fall of payroll tax revenues to pay Social Security recipients must be paid from general revenue. So, the $49 billion in 2010 is less interest, but it is also the amount of general revenue that must be used to pay recipients of SS.
But, yes, let’s not talk about Medicare. Truly scary.
Perry has stupidly taken a rhetorical lead from the Obama camp by maligning his political opponents as felons. I wouldn’t stand for from Obama and I won’t take it from Perry, either.
It’s one thing to mention Deval Patrick as being part of the “Obama camp” but Joe Klein and John Heilemann? Really? Now that we have established these ground rules, we are free to take the rantings of Rush Limbaugh, Glenn Beck, or any number of contributors at places like NRO and consider them all to be part of the Perry camp or the Romney camp or whoever emerges from the GOP presidential fight…I mean, I know some people believe in the MSM conspiracy and all that, but really…