Sarah Palin: Fed Plan Is ‘Obama’s Clever Way to Punt the Tough Calls’

By MichaelJames

Nov 10, 2010 8:16pm

ABC News’ Mary Bruce reports:

Sarah Palin said today that President Obama is trying to “punt the tough calls” by supporting the Federal Reserve’s decision to start a second round of quantitative easing, which she called a “dangerous experiment.”

Palin accused Obama of backing the monetary policy because it may ultimately “drive down the value of the enormous national debt Obama has run up.”

“The president is an educated man," Palin wrote in a lengthy post on her Facebook page. "I would hope that he knows these things as well as you and I do. So why then, if he knows it won’t really boost our exports or our domestic investments, would he still come out in defense of this dangerous experiment?

“I think the most plausible answer has to do with the debt," she wrote. "As liberal economist Paul Krugman has explained, a little inflation goes a long way towards driving down the value of the enormous national debt Obama has run up. And the higher the inflation, the greater the likelihood he won’t have to take any of the tough decisions needed to bring the deficit back down. In other words, pushing inflation upwards means you can have your cake and eat it too. You can spend all you like and then make the bill disappear by driving down the value of the dollar – buying with one hand the debt your reckless spending is issuing with the other. No need to cut spending, folks, just run the printing presses. It’s a win-win scenario.”

The Facebook post built on Palin's comments Monday in Phoenix, where she urged Federal Reserve Chairman Ben Bernanke to “cease and desist” on the plan to purchase as much as $600 billion of U.S. government debt, accusing the Federal Reserve of having a “pump-priming addiction.”

The harsh words from the 2008 vice presidential nominee came as President Obama prepared for the G20 summit in South Korea, where the Federal Reserve’s $600 billion “QE2” program is expected to be a key issue.

“If the President was serious about getting the economy moving again, he’d stop supporting the Fed’s dangerous experiments with our currency and focus instead on what actually works: reducing government spending and boosting business investment through good old fashioned supply side reforms (cutting taxes and reducing overly burdensome regulations)," Palin wrote. "Simply running the printing presses in order to avoid paying off your debts is no way for a great nation to behave."

The former Alaska governor warned today that “by the time this experiment is over, QE will make us queasy.”

Palin’s full comments can be read here: http://www.facebook.com/note.php?note_id=454151943434

–Mary Bruce

You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.
blog comments powered by Disqus