If you haven’t seen it yet, Rep Michele Bachmann questioned Tim Geithner and Ben Bernanke on 03/25/09 and took a position rarely seen in Washington DC.  In short, her position is that which is enshrined in the 10th Amendment – “Where in the Constitution are the Treasury and the Fed given such powers?”

Bachmann: What provision in the Constitution could you point to, to give authority for the actions that have been taken by Treasury since March of 08?

Geithner:  Oh, uh, the Congress legislated in the emergency economic stabilization act a range of very important new authorities..

Bachmann:  Sir, in the Constitution.  What in the Constitution could you point to, to give authority to the treasury for the extraordinary actions that have been taken.

Geithner:  Every action that the treasury and the fed and the FDIC is….been using authority granted by this body…by the Congress.

Bachmann:  And in the Constitution, what could you point to?

Geithner:  Under the laws of the land, of course.

Bachmann:  And if I could move to the federal reserve chair, if you could point to what provision in the Constitution that would give authority to the federal reserve – this has been over 10 trillion dollars that we’re talking about.

Bernanke:  I don’t know where 10 trillion dollars comes from.  The congress has the right to authorize funds, which is what they did in the TARP program, and they have given us in the 1930s…they gave the federal reserve the power for emergency lending as a means of addressing financial crises which is what we’ve done.

Bachmann:  And to the federal reserve chair – Do you believe there are any limits on the authority that the Federal Reserve has taken since last March…of 08?

Bernanke:  The loans we make have to be fully secured and collateralized.  We have practical limits in terms of our ability to manage monetary policies.  So there are obviously limits. We have reported extensively to the Congress on all the actions we have taken, and the actions we’ve taken have been solely and entirely for the purpose of protecting the American economy from the effects of financial collapse.

With news this week that Congress is poised to consider a new stimulus package, I am forced to again ask a question that seems silly in Washington:  How will we pay for this?

While a few Members of Congress have raised the issue, it certainly was not the primary concern of the House Budget Committee when they interviewed Ben Bernanke on Monday.  And, when they did direct this question to the Chairman of the Federal Reserve, his answer was the standard rhetoric about how Congress needed to make tough choices.  Needless to say, not many specifics were discussed.

One of the most liberal members of the House, Barney Frank, has at least volunteered something of a suggestion: “We can let Iraq take care of itself.”  This, of course, goes in the right direction, but hardly far enough.

We need to declare the facts and their obvious consequences.  The deficit of the United States is now spiraling out of control, and the recent bailout package has only made it worse.  Our crushing federal debt is one key reason behind our current economic turbulence.

As Congress begins to consider the third “stimulus package” of the year, we need to realize it is time to start setting priorities.  Priority number one should be cutting spending in foreign countries. This does not simply mean Iraq, but everywhere.

The next stimulus package is likely to include money for infrastructure.  While these investments are, constitutionally speaking, supposed to be made by state and local governments, it is not likely that Congress will suddenly begin to pay heed to the document we are all sworn to uphold.  Still, we need to acknowledge the fact that the current Congress and Administration are rushing the nation toward bankruptcy.

This being the case, we could hope they would at least come to their senses regarding our debt and foreign spending sprees.  Our nation’s foreign-held debt is at record highs and moving ever higher.  Continuing to borrow money from Red China and others in order to pay “dues” to the United Nations and run “Plan Colombia” makes no sense at all.

Our whole carrot-and-stick approach to foreign policy makes no sense.  The US government simultaneously gives money to Israel, and to Egypt.  We send AIDS money to Africa while AIDS clinics in America shut down.  “Millennium challenge” funding goes to countries which enact “market based reforms” as we push our own country further and further into a centrally planned economy.

Economic recovery will only come through financial prudence, savings and getting back to producing things of value again.  But it seems to be a foregone conclusion that we are about to enact another government initiative to “stimulate the economy.”   Instead, there should be some serious talk about cutting all of these foreign giveaway programs.  But, alas and again, we should not hold our breath.  Congress is still not close to being serious about ending its addiction to debt and spending, and is again faced with the deadly temptation to attempt to spend us out of a recession.  We should not forget that in the 1930’s those types of efforts gave us the Great Depression.

Ron Paul is a republican member of congress from Texas.