All posts by Ron Paul

Are Recessions Inevitable?

undefined

Stocks fell last week following news that the yield curve on Treasury notes had inverted. This means that a short-term Treasury note was paying higher interest rates than long-term Treasury note. An inverted yield curve is widely seen as a sign of an impending recession.

Some economic commentators reacted to the inverted yield curve by parroting the Keynesian propaganda that recessions are an inevitable feature of a free-market economy, whose negative effects can only be mitigated by the Federal Reserve. Like much of the conventional economic wisdom, the idea that recessions are caused by the free market and cured by the Federal Reserve is the exact opposite of the truth.

Interest rates are the price of money. Like all prices, they should be set by the market in order to accurately convey information about economic conditions. When the Federal Reserve lowers interest rates, it distorts those signals. This leads investors and businesses to misjudge the true state of the economy, resulting in misallocations of resources. These misallocations can create an economic boom. However, since the boom is rooted in misperceptions of the true state of the economy, it cannot last. Eventually the Federal Reserve-created bubble bursts, resulting in a recession.

So, recessions are not a feature of the free market. Instead, they are an inevitable result of Congress granting a secretive central bank power to influence the price of money. While monetary policy may be the prime culprit, government tax and regulatory policies also damage the economy. Many regulations, such as the minimum wage and occupational licensing, inflict much harm on the same low-income people that the economic interventionists claim benefit the most from the welfare-regulatory state.

The best thing for Congress and the Federal Reserve to do after the bubble bursts is to let the recession run its course. Recessions are painful but necessary if the economy is going to heal from the damage done by government’s inflate-tax-borrow-spend-and-inflate-some-more policies. But Congress and the Fed cannot resist the cries to “do something.” So, Congress spends billions on wasteful “economic stimulus” plans and bailouts of politically influential corporations. Meanwhile, the Fed tries to “prime the pump” via new money creation, restarting the whole boom-and-bust cycle.

This is not to say that no one would experience economic difficulties in a free market. Businesses and even whole industries would still close because of changing consumer tastes, new competitors offering superior products, or bad business decisions. There may even be bubbles in a free market as some investors misread fads as permanent changes in consumer preferences. But periods of downturn would be shorter, and most would only affect specific industries rather than the entire economy.

President Trump’s imposition of tariffs (which are a form of taxes on American consumers) has been particularly harmful. The tariff war has not just raised prices on imported consumer goods. It has also cut off markets for export-reliant businesses, such as manufacturers that import materials used to construct their products.

The trade dispute with China may be the event that pushes the US economy into a major recession or even a depression. However, the trade war is not the root cause of the downturn. The next recession, like every recession since 1913, will come stamped “Courtesy of the Federal Reserve.” The only way to end the boom-and-bust cycle and restore peace, prosperity, and liberty is to end the welfare-warfare state, repeal the Sixteenth Amendment, and audit then end the Fed.

Endgame for the Fed?

undefined

The Federal Reserve, responding to concerns about the economy and the stock market, and perhaps to criticisms by President Trump, recently changed course on interest rates by cutting its “benchmark” rate from 2.25 percent to two percent. President Trump responded to the cut in already historically-low rates by attacking the Fed for not committing to future rate cuts.

The Fed’s action is an example of a popular definition of insanity: doing the same action over and over again and expecting different results. After the 2008 market meltdown, the Fed launched an unprecedented policy of near-zero interest rates and “quantitative easing.” Both failed to produce real economic growth. The latest rate cut is unlikely to increase growth or avert a major economic crisis.

It is not a coincidence that the Fed’s rate cut came along with Congress passing a two-year budget deal that increases our already 22 trillion dollars national debt and suspends the debt ceiling. The increase in government debt increases the pressure on the Fed to keep interest rates artificially low so the federal government’s interest payments do not increase to unsustainable levels.

President Trump’s tax and regulatory policies have had some positive effects on economic growth and job creation. However, these gains are going to be short-lived because they cannot offset the damage caused by the explosion in deficit spending and the Federal Reserve’s resulting monetization of the debt. President Trump has also endangered the global economy by imposing tariffs on imports from the US’s largest trading partners including China. This has resulted in a trade war that is hurting export-driven industries such as agriculture.

President Trump recently imposed more tariffs on Chinese imports, and China responded to the tariffs by devaluing its currency. The devaluation lowers the price consumers pay for Chinese goods, partly offsetting the effect of the tariffs. The US government responded by labeling China a currency manipulator, a charge dripping with hypocrisy since, thanks to the dollar’s world reserve currency status, the US is history’s greatest currency manipulator. Another irony is that China’s action mirrors President Trump’s continuous calls for the Federal Reserve to lower interest rates.

While no one can predict when or how the next economic crisis will occur, we do know the crisis is coming unless, as seems unlikely, the Fed stops distorting the economy by manipulating interest rates (which are the price of money), Congress cuts spending and debt, and President Trump declares a ceasefire in the trade war.

The Federal Reserve’s rate cut failed to stop a drastic fall in the stock market. This is actually good news as it shows that even Wall Street is losing faith in the Federal Reserve’s ability to manage the unmanageable — a monetary system based solely on fiat currency. The erosion of trust in and respect for the Fed is also shown by the interest in cryptocurrency and the momentum behind two initiatives spearheaded by my Campaign for Liberty — passing the Audit the Fed bill and passing state laws re-legalizing gold and silver as legal tender. There is no doubt we are witnessing the last days of not just the Federal Reserve but the entire welfare-warfare system. Those who know the truth must do all they can to ensure that the crisis results in a return to a constitutional republic, true free markets, sound money, and a foreign policy of peace and free trade.

Congress Spending Surge is National Suicide

undefined

With a national debt approaching $23 trillion and a trillion dollar deficit for this year alone, Congress last week decided to double down on suicidal spending, passing a two year budget that has the United States careening toward catastrophe. While we cannot say precisely when the economic crash will occur, we do know that it is coming. And last week Congress pounded down on the accelerator.

We are told that the US economy is experiencing unprecedented growth, while at the same time the Fed is behaving as it does when we are in recession by cutting rates…and dodging insults from the President because it’s not cutting fast enough. This is not economic policy – it’s schizophrenia!

But that’s only the beginning.

Take what they call “national defense” spending. This is the misnomer they use to try and convince us that pumping trillions into the military-industrial complex will make us safe and free. Nothing could be further from the truth: probably ninety percent of the “defense” budget is aggressive militarism and welfare for the rich.

Under this budget deal the military budget would increase to nearly $1.4 trillion for two years. Of course that’s only a fraction of real military spending, which is, all told, well over one trillion dollars per year.

What do we get for this money? Are we safer? Not at all. We are more vulnerable than ever. We spend billions fighting “terrorism” in Africa while terrorism has actually increased since the creation of the US Africa Command – “AFRICOM” – in 2007. Meanwhile we continue to spend to maintain our illegal military occupation of a large section of Syria – which benefits terrorist groups seeking to overthrow Assad.

We’re sending thousands more troops to the Middle East including basing US troops in Saudi Arabia for the first time since 2003. Back then, even neocon Paul Wolfowitz praised our departure from Saudi Arabia because, as he rightly stated, US troops on Saudi soil was a great recruiting tool for al-Qaeda.

Now we’ve pulled out of the Intermediate-range Nuclear Forces (INF) treaty so that we can deploy once-forbidden missiles on China’s front door. A new arms race with China will mean a new boon for our new Defense Secretary’s former colleagues at Raytheon!

Senator Rand Paul (R-KY) pronounced the Tea Party dead with the adoption of this budget. He’s right of course, but only when it comes to Congress. Given the opportunity, I still believe a good part of the American people will vote for candidates who promise to rein in the national credit card. President Trump himself ran on a platform of ending deficit spending and even paying off the national debt!

So the Tea Party may be dead in Washington, but I am not convinced it was ever really alive in Washington. With a few exceptions, most politicians saw the Tea Party as just the flavor of the month. Spending is what keeps Washington alive and keeps the DC suburbs rich. They’re not about to cut back on their own.

But the spending will end. The trillions thrown down the drain on militarism will end. The only question is whether it will end when we are completely bankrupt and at the mercy of countries we’ve kicked around for decades or whether Americans will demand an end to bipartisan addiction to war and spending in Washington!

undefined

True Budget Hawks are Foreign Policy Doves

undefined

During my presidential campaigns, well-meaning supporters would sometimes suggest I stop emphasizing opposition to overseas intervention and focus on fiscal issues. I disregarded the advice, not only because adopting a noninterventionist foreign policy is crucial to restoring constitutional government but because it is impossible to be both a budget hawk and a war hawk. This is shown by the constant failure of so-called fiscal conservatives in the Republican leadership to fulfill their promise to cut spending.

Military spending is the second largest category of spending in the federal budget, behind Social Security spending. The US military budget equals the combined budgets of the next seven biggest-spending countries. Yet, many Republicans who claim to want to reduce federal spending want to increase the military budget.

Many Republicans also prioritize protecting the military-industrial complex over reducing spending on welfare and entitlement programs. This makes them eager to agree to a deal giving Democrats almost all of their welfare wish list as long as Republicans get almost all of their warfare wish list. Many Republicans do not have a principled objection to the welfare state; they just think Democrats want to spend too much on welfare and not enough in warfare. Many Democrats find increasing warfare spending acceptable; they just think Republicans want to overspend on warfare and underspend on welfare.

We saw the process at work again last week when the House passed a two-year budget deal that increases spending by approximately 320 billion dollars per year and suspends the debt ceiling for two years. Republican leadership ignored all these problems and claimed victory because the bill increases warfare spending.

A majority of Republicans opposed the spending bill, even though it was supported by President Trump and the Republican leadership. Of course, many more Republicans would have voted for the bill if a “conservative” Republican still held the speaker’s gavel.

Republicans’ love affair with the military-industrial complex is not the only reason they are unwilling to reduce spending, and military contractors are not the only Republican constituency demanding spending increases. Many farmers vote for Republicans who promise to cut most domestic spending except for agricultural subsidies. Also, many Republican Congress members support corporate subsidies and bailouts. Still, anyone who observes the behavior of Republican leaders around budget time can see they have a primary priority of protecting the military-industrial complex.

Republican Congress members’ support for ever-higher levels of military spending is justified by their support for an interventionist foreign policy. Some in Congress claim to favor both an interventionist foreign policy and reductions in military spending, but these so-called cheap hawks cannot resist the demands for an increased budget since they support a hyper-interventionist foreign policy. They are unable to effectively respond when their fellow hawks accuse them of compromising national security by opposing “adequately” funding the Pentagon.

As long as Republican leadership supports an interventionist foreign policy, it will never support reducing warfare or welfare spending. Therefore, fiscal conservatives must join libertarians to restore a foreign policy of peace and free trade. Lobbyists for the big military contractors would find it more difficult to make their case for big spending if Congress limits the defense budget to what is needed to defend America instead of wasting trillions in supposed efforts to police and democratize the world.

Will Persian Gulf ‘Tanker War’ Become a Shooting War?

undefined

The UK got a taste of its own medicine this week as Iran seized a British tanker, the Stena Impero, just two weeks after UK Royal Marines seized a tanker near Gibraltar carrying two million barrels of Iranian oil. As could be predicted, the US and UK media are reporting Iran’s seizure of the Stena Impero as if it were something out of the blue, pushing the war propaganda that “we” have been attacked and must retaliate. Media criticism of the UK is limited to claims that it has not put enough military into the Persian Gulf, not that it should never have seized the Iranian ship in the first place.

The truth is, the UK seizure of the Iranian ship was calculated to force Iran to retaliate and thus provide the pretext the neocons need to get their war.

As usual, Trump’s National Security Advisor John Bolton is in the thick of this operation. Bolton Tweeted that he was so surprised – but pleased – by the UK move against the Iranian tanker. However it is becoming clearer that Bolton was playing a role behind the scenes pushing London to lure Iran into making a move that might trigger the war he’s long been yearning for.

The ramping up of tanker wars comes just as the Pentagon has announced that it will send 500 US troops to Saudi Arabia – the first such US deployment since the US withdrew its troops in 2003. At that time, then-Deputy Secretary of Defense Paul Wolfowitz hailed the move out of Saudi Arabia as denying al-Qaeda one of its prime recruiting tools – US troops in their holy land. What will 500 troops do in Saudi Arabia? Some say they will help prepare the Prince Sultan military air base for a possible US air squadron deployment.

We must be clear on how we got to the very edge of war with Iran. President Trump pulled out of the Joint Comprehensive Plan of Action (JCPOA) promising he would exchange it for a much better deal for the US. He quickly re-applied all previous US sanctions on Iran and demanded that our allies do the same. The US policy would be to apply “maximum pressure” to Iran which would result in Iran capitulating and agreeing to all US demands.

US economic warfare against Iran would bring the country to its knees, the Administration claimed, and would deliver a big win to the US without a shot being fired. But the whole plan has gone terribly wrong.

Iran did not back down or beg for mercy in the face of Trump’s actions, and the Europeans have at least attempted to keep the JCPOA agreement alive. And the UK following neocon orders has led the country in a serious and unnecessary crisis that does not look to be easily resolved.

How could the US administration have miscalculated so badly? Many of us could have told President Trump that the neocons always promise a “cakewalk” when they are talking up a military action. Time and time again – Iraq, Afghanistan, Libya, Syria – they promise a quick victory and deliver a quagmire.

The American people overwhelmingly do not want to go to war with Iran and the president wants to be re-elected. Will he return to the political base that elected him on promises of getting along with the rest of the world, or will he continue to follow his neocon advisors down the road to a failed presidency?

Conservatives Against Liberty

undefined

Recently several prominent social and populist conservatives have attacked libertarianism. These conservatives, some of whom are allies in the fight against our hyper-interventionist foreign policy, blame libertarianism for a variety of social and economic ills. The conservative attack on libertarianism — like the attack on the freedom philosophy launched by leftists — is rooted in factual, economic, and philosophical errors.

Libertarianism’s right-wing critics claim libertarianism is the dominant ideology of the Republican establishment. This is an odd claim since the Republican leadership embraces anti-libertarian policies like endless wars, restrictions on civil liberties, government interference in our personal lives, and massive spending increases on welfare as well as warfare.

Anti-libertarian conservatives confuse libertarianism with the authoritarian “neoliberalism” embraced by both major parties. This confusion may be why these conservatives blame libertarians for the American middle class’s eroding standard of living. Conservatives are correct to be concerned about the economic challenges facing the average American, but they are mistaken to place the blame on the free market.

The American people are not suffering from an excess of free markets. They suffer from an excess of taxes, regulations, and, especially, fiat money. Therefore, populist conservatives should join libertarians in seeking to eliminate federal regulations, repeal the 16th Amendment, and restore a free-market monetary system.

Instead of fighting to end the welfare-regulatory system that benefits economic and political elites at the expense of average Americans, populist conservatives are promoting increased economic interventionism. For example, many populist conservatives support increased infrastructure spending and tariffs and other forms of protectionism.

Like all forms of central planning, these schemes prevent goods and services from being used for the purposes most valued by consumers. This distorts the marketplace and lowers living standards — including of people whose jobs are temporally saved or created by these government interventions. Those workers would be better off in the long term finding new jobs in a free market.

Anti-free-market conservatives ignore how their policies harm those they claim to care about. For example, protectionism harms farmers and others working in businesses depending on international trade.

The most common complaint of social conservatives is that libertarianism promotes immorality. These conservatives confuse a libertarian’s opposition to outlawing drugs, for example, with moral approval of drug use. Many libertarians condemn drug use and other destructive behaviors. However, libertarians reject the use of government force to prevent individuals from choosing to engage in these behaviors. Instead, libertarians support the right of individuals to use peaceful means to persuade others not to engage in destructive or immoral behaviors.

Libertarians also support the right of individuals not to associate with, or to subsidize in any way, those whose lifestyles or beliefs they find objectionable. Social conservatives object to libertarians because social conservatives wish to use government power to force people to be good. This is the worst type of statism because it seeks to control our minds and souls.

Most people accept the idea that it is wrong to initiate force against those engaging in peaceful behaviors. Libertarians apply this nonaggression principle to government. Making government follow the nonaggression principle would end unjust wars, income and inflation taxes, and the destruction caused by the use of force to control what we do with our property, how we raise our children, who we associate with, and what we put into our bodies. Making governments abide by the nonaggression principle is the only way to restore a society that is free, prosperous, and moral.

Frog-Marching Trump Toward War on Iran

undefined

Hypocrisy seems to have become a defining characteristic of US foreign policy, especially when it comes to Iran. After breaking the Iran deal last year and, de facto, forcing the Europeans to violate the deal in May, the US Administration is now complaining that Iran is no longer abiding by its obligations under the deal!

It’s remarkable to see Secretary of State Mike Pompeo take to Twitter to complain of Iran enriching uranium to pre-deal levels, as if somehow the US believes it can still dictate the terms of a deal to which it is no longer a party.

This latest neocon push for US war on Iran started last week when Iran exceeded the limit of a 300 kilogram stockpile of low-enriched uranium. As usual, the media only reported part of the story. One reason Iran went over the limit was that the countries to which Iran was exporting its excess uranium were notified by the US in early May that they would face US sanctions if they continued taking the uranium off Iranian hands.

The US created the crisis by preventing Iran from exporting its excess uranium and then pointed to the expanding Iranian stockpile of uranium enriched to 3.6 percent as proof that Iran was about to launch a nuclear weapon!

Make no mistake about it: Trump’s neocons are determined to trap him into a massive, disastrous war with Iran and they are using the same tactics they used to hoodwink George W. Bush into a multi-trillion dollar war on an Iraq that could not have attacked us if it wanted to.

Secretary Pompeo Tweeted yesterday the exact kind of dishonest hysterics used to terrify many Americans into supporting an Iraq attack 13 years ago: “Iran’s regime, armed with nuclear weapons, would pose an even greater danger to the world.”

As the former head of the CIA, surely Pompeo knows that his own agency had determined back in 2003 that Iran had abandoned its nuclear weapons program and that every US intelligence assessment since them has concurred with that conclusion. But then again, he did brag recently about his excellent ability to lie, cheat, and steal.

Though the Europeans promised Iran that they would continue to honor the deal, they have proven themselves unable to put forth a credible alternative to the US-dominated SWIFT system, meaning no trade in Iran’s number one export: oil.

Iran responded over the weekend to European fecklessness by announcing that they would begin enriching uranium up to five percent, which is a level needed to run one of its nuclear power generating plants. As could be predicted, this move – which is allowed according to section 36 of the Iran deal – is being treated as the equivalent of Saddam’s “mobile chemical weapons labs.”

The Iranians are not backing down. They rightly feel cheated, as they continued to honor the deal even as the US re-imposed crippling sanctions meant to destroy their economy and starve their people.

President Trump has a very serious decision to make. He is being frog-marched into war by his neocons and his Middle East “partners.” He has very little time left to change course. If the neocons are not swept out immediately, he is risking both his second term and his legacy.

Media and Politicians Ignore Oncoming Financial Crisis

undefined

The mainstream media was too busy obsessing over Russiagate to notice that, according to an annual Social Security and Medicare Boards of Trustees report, the Social Security trust fund will run out of money by 2035. The trustees also reported that the Medicare Hospital Insurance trust fund will be empty by 2027.

The trustees’ report is actually optimistic. Social Security is completely funded, and Medicare is largely funded, by payroll taxes. Therefore, their revenue fluctuates depending on the employment rate. So, when unemployment inevitably increases, payroll tax revenue will decline, hastening Medicare and Social Security’s bankruptcy.

Another dark cloud on the government’s fiscal horizon involves the Pension Benefit Guaranty Corporation (PBGC), which provides federal bailouts to bankrupt pension plans. The PBGC currently has an over 50 billion dollars deficit. This deficit will almost certainly increase, as a number of large pension funds are likely to need a PBGC bailout in the next few years. Congress will likely bail out the PBGC to avoid facing the wrath of voters angry that Congress did not save their pensions.

Unfunded liabilities like Social Security and Medicare are not included in the official federal deficit. In fact, Congress raids the Social Security trust fund to increase spending and hide the deficit’s true size, while leaving the trust fund with worthless IOUs.

The media also ignored last week’s Congressional Budget Office (CBO) report predicting the federal debt will increase to an unsustainable 144 percent of the gross domestic product by 2049. The CBO’s report is optimistic as it assumes interest rates remain low, Congress refrains from creating new programs, and there are no major recessions.

Few in Congress or in the Trump administration are even talking about the coming fiscal tsunami, much less proposing the type of spending cuts necessary to pay down the debt and have the funds to unwind the entitlement programs without harming those currently reliant on them. Instead, both parties support increasing spending and debt.

Republican control of both houses of Congress and the While House led to increased federal spending of over $300 billion dollars. The House Democratic majority now wants even more spending increases. House Speaker Nancy Pelosi is threatening to not raise the debt ceiling unless President Trump and congressional Republicans agree to lift the spending caps put in place by the 2011 budget deal.

The Republican Congress routinely exceeded the caps’ minuscule spending limits. Therefore, Speaker Pelosi should have no problem getting President Trump and his Republic congressional allies to once again exceed the caps on welfare spending as long as Democrats agree, as they are likely to agree, to bust the caps on warfare spending.

America’s military budget already equals the combined budgets of the next seven highest-spending countries. Instead of allowing himself to be neoconned into wasting trillions on another Middle East quagmire, President Trump should bring home the nearly 170,000 troops stationed in almost 150 countries.

Unless Congress immediately begins making substantial spending cuts, America will soon face a major economic crisis. This crisis will likely involve the Federal Reserve’s debt monetization resulting in a rejection of the dollar’s world reserve currency status. Since the media and most politicians refuse to discuss this topic, it is up to those of us who understand the truth to spread the word, grow the liberty movement, and force politicians to make real cuts right now.

Boxed in by Neocons and the Media, Will Trump Launch Iran War?

undefined

President Trump did the smart thing last week by calling off a US airstrike on Iran over the downing of an American spy drone near or within Iranian territorial waters. According to press reports, the president over-ruled virtually all his top advisors – Bolton, Pompeo, and Haspel – who all wanted another undeclared and unauthorized US war in the Middle East.

Is Iran really the aggressive one? When you unilaterally pull out of an agreement that was reducing tensions and boosting trade; when you begin applying sanctions designed to completely destroy another country’s economy; when you position military assets right offshore of that country; when you threaten to destroy that country on a regular basis, calling it a campaign of “maximum pressure,” to me it seems a stretch to play the victim when that country retaliates by shooting a spy plane that is likely looking for the best way to attack.

Even if the US spy plane was not in Iranian airspace – but it increasingly looks like it was – it was just another part of an already-existing US war on Iran. Yes, sanctions are a form of war, not a substitute for war.

The media are also a big part of the problem. The same media that praised Trump as “presidential” when he fired rockets into Syria on what turned out to be false claims that Assad gassed his own people, has been attacking Trump for not bombing Iran. From Left to Right – with one important exception – the major media is all braying for war. Why? They can afford to cheer death and destruction because they will not suffer the agony of war. Networks will benefit by capturing big ratings and big money and new media stars will be born.

President Trump has said he does not want to be the one to start a new war in the Middle East. He seemed to prove that by avoiding the urgings of his closest advisors to attack Iran. It is hard to imagine a president having top advisors who work at cross-purposes to him, planning and plotting their wars – and maybe more – behind his back. Even Trump seems to recognize that his national security advisor is not really serving his administration well. Over the weekend he said in an interview, “John Bolton is absolutely a hawk. If it was up to him he'd take on the whole world at one time, okay?”

I think when you have a national security advisor who wants to fight the whole world at once, you have a problem. Does anyone believe we will be more secure after spending a few trillion more dollars and making a few hundred million more enemies? What does “victory” even look like?

President Trump is in a bind and it is of his own making. Iran has shown that it is not willing to take its marching orders from Washington, which means “maximum pressure” from the US will not work. He has two options remaining in that case: risk it all by launching a war or make a gesture toward peace. A war would ruin his presidency – and a lot more. I would urge the president to issue waivers to China, India, Turkey, and the others who wish to continue buying Iranian oil and invite the Iranian leadership to meet at a neutral location. And fire Bolton and Pompeo.

Medical IDs: Enemy of Privacy, Liberty, and Health

undefined

Last week, the House of Representatives voted in favor of a Labor, Health and Human Services, and Education appropriations bill amendment to repeal the prohibition on the use of federal funds to create a “unique patient identifier.” Unless this prohibition, which I originally sponsored in 1998, is reinstated, the federal government will have the authority to assign every American a medical ID. This ID will be used to store and track every American’s medical history.

A unique patient identifier would allow federal bureaucrats and government-favored special interests to access health information simply by entering an individual’s unique patient ID into a database. This system would also facilitate the collection of health information without a warrant by surveillance state operatives.

The health records database could easily be linked to other similar databases, such as those containing gun purchase records or education records. If mandatory E-Verify becomes law, the health records database could even be linked to it, allowing employers to examine a potential employee’s medical history.

The possibility that the unique patient identifier system may be linked to a database containing information regarding gun ownership is especially disturbing given the bipartisan support for “red flag” laws. These laws allow the government to deny respect for someone’s Second Amendment rights without due process and based solely on an allegation that the individual is mentally unstable and likely to commit an act of gun violence. Combining red flag laws with the unique patient identifier system would leave a gun owner who ever sought psychiatric help for any reason at risk of losing his ability to legally possess a gun.

Unscrupulous government officials could use medical information to harass those whose political activities challenge the status quo. Anyone who doubts this should ask themselves what a future J. Edgar Hoover or Lois Lerner would do with access to the medical information of those involved in political movements he wishes to silence.

The unique patient identifier undermines one of the foundations of quality health care: the doctor-patient relationship. Accurate diagnosis requires that patients share intimate details about their lives — ranging from details about their diet and exercise habits to their sexual history and alcohol and drug use — with their physicians. If patients legitimately fear information shared will be compromised, they will be unwilling to be completely honest with their physicians, making it impossible for physicians to effectively treat their patients.

Proponents of the unique patient identifier claim it will improve efficiency. But, in a free society, the government should never endanger privacy or liberty for efficiency. Besides, when has any government intervention in health care ever improved efficiency or increased patients’ or health care providers’ satisfaction with the system?

The unique patient identifier system puts the desires of government bureaucrats and politically powerful special interests ahead of the needs of individual patients and health care providers. Instead of further intervening in health care and further destroying our privacy and our liberties, Congress should give patients control over their health care by giving them control over health care dollars through expanding access to Health Savings Accounts and health care tax credits. In a free market, patients and doctors can and will work tighter to ensure patients’ records are maintained in a manner that provides maximum efficiency without endangering privacy or liberty.