Republican Senate long-shot talks economy

Unless the government repeals its bailout and stimulus plans, another recession or depression is inevitable, Connecticut U.S. Senatorial candidate Peter Schiff told an audience of 70 at the School of Management on Thursday.

“As compared to other countries, we have a lot more rope with which to hang ourselves,” he said. “But eventually, we will hang ourselves.”

During his talk, entitled “The Financial Crisis and What It Means for Students,” Schiff, an economist and the president of the Westport, Conn.-based brokerage firm Euro Pacific Capital, blamed the Federal Reserve and both the Bush and Obama administrations for intervening in the financial markets and causing the current economic downturn. Although the lecture was part of a non-partisan seminar series by the Yale Biotechnology & Pharmaceutical Society, Schiff, who is a former campaign staffer for Republican Party candidate Ron Paul, also focused on his attempt to win U.S. Sen. Christopher Dodd’s seat.

Likening the Federal Reserve’s behavior and the federal stimulus package plans to drugs meant to mask the pain of recession, Schiff warned that the economy could soon go through even more painful withdrawals.

“The government pretends to have a magic elixir that makes the pain go away,” said Schiff, a self-described Republican with libertarian sympathies.

Attributing the 2008 financial collapse to low interest rates following the 2000 dot-com bubble burst, during which shareholders lost billions of dollars as the stock prices of several online companies suddenly dropped, Schiff said the government’s high spending can only temporarily prevent a currency crisis and hyperinflation.

“Jobs aren’t created because the government passed bills,” he said. “They are lost when the government passes bills. The economy is getting starved for capital because the government is spending so much.”

Schiff added that he is so pessimistic about the current economic climate that he encourages his clients to invest overseas.

Turning to his campaign, he said he can bring his financial expertise to Washington. He added that the only permanent solution for the recession is to allow the interest rate to go to free market levels.

Referring to fellow competitors in the Republican primary, Linda McMahon and Robert Simmons, as an “entrepreneur with limited knowledge on economics” and a “career politician,” respectively, Schiff said he tried to base his platform on “honesty” about the nation’s economic situation.

“We are doomed unless I’m elected,” he added, jokingly.

The five audience members interviewed said Schiff had a good grasp of how the financial crisis occurred, even if they did not completely agree with everything he said.

“I’ve personally been following Schiff and his intellectual debtors for years,” audience member Ted Sonnier MUS ’10 said. “But I personally think his likelihood of being elected is a long shot.”

According to a January Quinnipiac University poll, Schiff currently is behind McMahon and Simmons in the Republican primary, with 4 percent of the vote. McMahon has 27 of the vote, while Simmons has 37 percent.

Comments

  • VoteSchiff

    If Peter Schiff doesn’t win the senate, the next time someone complains about career politicians or the same old, same old in DC call them on it. Schiff may be running on the republican ticket but he is the first true independent to seek office in a long time. He “gets it”.

  • SomeDude

    I’m surprised the marxist fanatics at Yale even let Schiff speak. Is this change in the wind ? I’m impressed ! But then again I’m sure business school has the fewest marxists. LOL

  • Tanner

    Agreewith you VoteShiff

    This would be a real kick in the pants to Washington as we see Senator Brown has already started to get chummy with the DC crowd. Did anyone really believe he was going to shake things up? I just want a Senator or Representive show up on Capitol Hill and announce to his “colueges” that he does not like them and does not want to get along with them and not to bother joining them at their cocktail partys.

  • science grad student

    #2, agreed. It’s funny how Yale constantly talks up its love for diversity, and yet continues to bring in only leftist speakers.

  • davejoe75

    What’s with that last statement from a student, “I like Schiff, but he probably won’t get elected.”? What does a student know of this race? Why is that worthy of print?

    The DC consensus, journalists and especially those Yaley’s only know and follow front runners. They also said that Hillary was a shoe-in for president. We have a long way to go before Nov. is here.

  • Devore

    Basing the headline and half the article on some college student’s say-so is a little far fetched, maybe even a long shot, hmm?

    In case anyone is wondering, the claim that high government spending starves the market is that government makes no money of its own which it can spend (aside that which it prints, har har). All their money comes from taking it from other people (taxing) and soaking up private capital (T-bills), both of which would have otherwise been spent by private individuals and companies in the market where it was needed, as opposed to where the government saw fit.

  • Craig

    The fact that Peter Schiff only has 4% of the vote shows that this recession has a long way to go. Until people are so down that they are willing to sit back and look at this economy rationally and take the advice of people like Peter and the other Austrian School economists that have been right all along, we have no hope for pulling out of the nose dive.