The main premise of Ron Paul’s position on federal spending (as I understand it) is, using FEDERAL money and FEDERAL solutions is always less effective and more abuse-prone, than using State local programs to achieve the same goal. Using private money is more effective yet.
I don’t think there is much difference between using federal and state money and I don’t think Ron Paul does either. He uses federal vs. state card to avoid addressing hot issues like gay rights, abortion, etc.
government-funded science is by far less productive than privately funded labs.
Some branches of science require presence of government to advance. Private investors aren’t going to pay for research unless it is likely to lead to profits in reasonable timeframe. Theoretical physics is a good example. Then, there are things that can’t come into existence unless backed by government(s). Some time next year we will probably see the launch of the largest particle accelerator in the world (LHC). It was built in Switzerland at the cost of around $3 billion. It is going to keep a good portion of world’s high energy physicists busy for the next 10 years. No private investor or a group of investors is going to pay for a project like this. For a government like the one we have in the U.S., it’s peanuts ($15 from every taxpayer). (Incidentally, an even bigger accelerator could have been finished and launched in Texas 10 years ago, but, in the end, the government decided that the project was too expensive and killed it.)
Same thing with space exploration. It’s been 50 years since the launch of Sputnik and still no private company has been able to even come close to putting a man-made object into orbit. It’s just too expensive.
With the income tax abolished, you will be able save by far more money than you ever could.
The problem is, people who need Social Security / Medicare most don’t pay much (if any) income tax. Abolishing income tax will greatly benefit lawyers and engineers and programmers (especially single ones), but it won’t do much for a burger flipper or a janitor who makes $30,000 a year.
But my understanding is, Ron Paul does not want the government to dictate the rates. Free market tends to self-correct.
Ron Paul’s views on economics (and the Austrian school in general) are the economic equivalent of the intelligent design. It’s okay to study the intelligent design as long as it stays theory, but you’re going to get in trouble if you try to solve real-world problems and to make policy decisions based on it. Conventional economics tells us that attempting to keep a tight lid on money supply in times like the present has a good chance of turning a potentially mild economic slowdown into a full-scale depression. Who would you rather trust to make decisions on this subject? An obstetrician (Ron Paul) or a professor with three published textbooks on macroeconomics (Ben Bernanke)?
The thing about free market, it tends to adhere to a 80/20 rule: 20% of people make 80% of the money. Basic cost of living is nearly the same for everyone, so people who make more money can save more and invest more. Rich get richer and poor stay poor. In the United States, inequality is not so pronounced, for a number of reasons, all of them anti-libertarian (income tax, minimum wage laws, partially socialized medicine and education). Minimum wage laws make it uneconomical to manufacture stuff in America. Instead of assembling iPods and painting toys, unskilled Americans join the service industry. American burger flipper is far better off than Chinese manufacturing worker, because minumum wage laws make sure that he’s paid at least $5.15 an hour (more than most Chinese workers make in a day), and his clients can afford to pay $3 for a Big Mac.
