Ex-Gov. Johnson: Fed Policy Like a Madoff Ponzi Scheme

Sunday, 17 Apr 2011 12:39 PM

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America is headed toward “the ultimate financial crisis” with misguided and irresponsible Fed policies all but assuring “the virtual meltdown of the financial markets,” former New Mexico governor and likely GOP presidential contender Gary Johnson says.

“The Federal Reserve right now is buying up our own debt,” Johnson tells Newsmax.TV. “That’s like Bernie Madoff having a printing machine to cover his Ponzi scheme. That’s what we’ve got going. We’re going to have a financial collapse.”

Johnson calls for deep, across-the-board spending cuts to cure America’s fiscal ills. To date, he says, neither Democrats nor Republicans have put forth a budget proposal with enough meaningful reductions to ensure the country’s long-term financial health. Even the 2012 budget proposal from House Budget Committee Chairman Paul Ryan, R-Wis., with its $6 trillion in cuts over 10 years, falls short, he says.

Story continues below video.



“Rep. Ryan’s proposal is about quarter of where it should be, it extends [cuts] out too far, and doesn’t talk about cuts in defense,” Johnson says. “These proposals don’t go far enough, and don’t do it soon enough.”

Johnson advocates balancing the budget immediately with all options on the table. “That means talking about Medicare, Medicaid, reforming Social Security and defense spending,” he says.

“This country is bankrupt, we’re on the verge of financial collapse,” Johnson warns, adding that politicians’ intolerance for “short-term pain” has the nation staring down “the ultimate financial crisis, which is the virtual meltdown of the financial markets.

“Unless we fix this, we’ll all be left with nothing,” Johnson says.

Johnson, 58, started a handyman business in Albuquerque as a teenager and built it into one of the state’s largest contracting firms, employing more than 1,000 workers by the time he sold the business in 1999. He shocked political watchers in Democrat-dominated New Mexico when he won the governor's office in 1994, then was re-elected in 1998. He was barred by term limits from seeking a third term.

As a two-term governor in a border state, Johnson has strong opinions on immigration, as well. He dismisses the idea of increased border enforcement and says the United States needs to make it easier for illegal immigrants to attain legal status through work visas.

“Immigration is a creator of tens of millions of jobs,” Johnson says. “We’re a nation of immigrants. Immigration is a good thing, not a bad thing.”

Johnson says the reason 11 million illegal immigrants are burdening the systems in border states today is because “the government has made it impossible to get work permits.”

“We need to make it as easy as possible to get a work visa – not citizenship, not a green card – but a work visa, that would entail a background check and a Social Security card so that applicable taxes get paid,” he says. “We need a grace period so that those 11 million [illegals] can get a legal work visa. Once you make it easier to get work visas, then enforce the law.

“The notion of building a fence across 2,000 miles of border … means a whole lot of money spent with no benefit whatsoever.”

Among other issues Johnson touched on in his Newsmax.TV interview:

  • Capping the debt ceiling: Johnson says he would not vote to raise the debt ceiling despite persistent dire predictions of the fiscal fallout. “We have to deal with this sooner, not later. Putting it off into the future is just more of what we’ve been doing.”
  • Changing the tax code: The former governor says he backs a shift to a flat tax to “simplify taxes and make everyone pay their fair share.” He also advocates eliminating the “unfair” corporate income tax to “re-establish this country as the place to grow and nurture businesses.”
  • Legalizing marijuana: Johnson says making pot legal is the best way to address rising violence along our border. “Drug violence is prohibition. These are disputes played out with guns. When I say legalize marijuana, control it, regulate it, tax it.”
Johnson is expected to announce his candidacy for president next week at a news conference scheduled in the Capitol building in Concord, N.H. Johnson has traveled to 38 states since December 2009, when he founded the Our America Initiative PAC, according to the New Mexico Independent.

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