Monday, September 1, 2014

What Ron Paul Did Wrong

By Robert Wenzel

As the Ron Paul Inc. scandal unfolds for all to see, the question must be asked, how did all this come to pass?

I remain in the camp, until shown otherwise by cold hard facts, that Ron Paul very likely knew nothing about the lunatic shenanigans of Ron Paul Inc. But is there any culpability on Dr. Paul's part?

As an outsider, it always looked to me that RP was more interested in getting the liberty message out than in political machinations. And there were certain steps he took which could be viewed as attempting to keep the political operation from getting out of control.

He put his daughter, Lori Pyeatt, as the treasurer of the Ron Paul 2012 campaign. This could have been viewed as a smart move. RP was raising a lot of money and in someways it made sense to have someone close to you, and someone you trust, watch over the money. As I reported in my post,Ron Paul's Daughter and the Guilty Plea of Kent Sorenson:
 [I]t is extremely unlikely that Pyeatt was aware of the madcap, lunatic secret payoffs that were made to Sorenson. This should be clearly understood.
Individuals who know the Paul family tell me that it would be completely out of character for Pyeatt to go along with such an insane scheme. Since the payments were first routed by the Ron Paul Campaign through a film production company, Interactive Communications, it is likely that Pyeatt was simply duped and was told that the payments were for political television ad campaign work.
That said, the government is all over the Ron Paul 2012 campaign and EPJ has become aware that Pyeatt 's emails are among those that have been subpoenaed. I want to emphasize, though, that, until shown otherwise by cold hard facts, I do not believe that Ron or his daughter were in any of the nutty operations that are at the foundation of the current developing scandal.

In another attempt to perhaps keep the 2012 campaign under control, RP also put in place another family member to a key position in the campaign, Jesse Benton. Benton is married to RP's granddaughter, but in many ways it does not seem that Benton was the right man for the job. There are strong indications that he put his own career as a political operative ahead of properly protecting the Paul brand and he appears to have been way over is head. This appointment may have been the one serious mistake made by Ron.

Tom Woods wrote about Benton in September 2012:
Ron Paul campaign chairman Jesse Benton is going to head up the campaign of Mitch McConnell. Gee, now why did those incorrigible naysayers have so many unkind words for him?

People who said Benton was positioning himself all along for bigger things in the GOP were scoffed at. Why, Jesse has a secret plan to get Ron Paul the nomination at the last minute!

Well, now we know the real secret plan.

Ask yourself this: how much money would you have to be paid to work for an enemy of the things you’re supposed to stand for? Maybe now people will understand why Jesse would fly into a tirade after some of Ron’s most heroic moments, when the rest of us were cheering.

I could go through a lengthy catalogue of problems with Benton. The grassroots folks already know a lot of them, so there’s probably no need. What’s done is done.
But aside from apparently being just another political opportunist, it appears that in many ways Benton was a clueless opportunist. Take for example the background surrounding the illegalities at the epicenter of the current scandal, the under the table payments to Kent Sorenson   (SEE: BREAKING: Kent Sorenson Pleads Guilty to Concealing Ron Paul Campaign Payoff).

At this point, we know with certainty that Benton thought it was a good idea to pursue Sorenson (SEE: Very Serious Allegations Made Against 2012 Ron Paul Campaign Manager Jesse Benton). Though there is no smoking gun that has emerged, yet, that shows Benton was aware of the under the table payments to Sorenson, it is not difficult to suspect that he did know.

But the big question is why put so much effort into pursuing Sorenson anyway?

As a political operative pointed out to me, the only thing Sorenson moving over to the Ron Paul camp did was signal to voters that the failing Bachmann camp had collapsed. It caused Bachmann voters to move to Rick Santorum, not Ron.

In other words, the nutty under the table payoff to Sorenson probably cost Ron a first or second place finish in Iowa. Take a look for yourself. Here are the 2012 Iowa Republican Caucus results: 

  • Santorum
  • Romney
  • Paul
  • Gingrich
  • Perry
  • Bachmann

If Sorenson had stayed with Bachmann, she would have probably put in a  better showing, pulling votes from first place finisher Santorum, who was in line with her hawkish foreign policy views.This might have resulted in a better finish for Ron.

A Roger Stone tweet highlights the nuttiness of the payoff:

The  scandal reveals a degree of incompetence by Benton. It is only the full degree of incompetence that we don't know, yet. (Though the DOJ is surely going to provide us with more facts over time.)

Another odd move by Benton was the manner in which he treated Dennis Fusaro, who attempted to warn him privately on more than one occasion, over a six month period, of the developing scandal.

Benton's email response to Fusaro's warning was:
You are an insane and delusional person, Dennis.  I hope you get help. I’ll pray for you.
If things get any worse for Benton, he is going to have plenty of time to pray for Fusaro---from the inside of a prison chapel.

Note to anyone ever involved with a public company or other organization, if anyone, especially someone that might be hostile to you, makes charges to you about possible illegal activities at your organization, start an "investigation" right away. Not because you want to uncover dirt on your own organization, but to protect yourself from being seen as an accomplice. Find a lawyer who understands that "investigation" means "make this thing go away permanently."

When rumors began circulating over Ed Crane activities at Cato, the Koch brothers brought in lawyers and put Crane and the problem out to pasture, (SEE: "Female Professional Staff Members have been the Target of Unsolicited Sexual Advances by Ed Crane" and Koch Brothers-Cato to Settle; Crane to Leave)

That's how the big boys play, not by insulting the messenger.

Finally, there is the extreme oddity of Benton bringing Dmitri Kesari over to the Mitch McConnell camp. Kesari is, of course, "Political Operative D" in the statement of facts that accompanied the guilty plea of Sorenson. He is most assuredly the individual who directly negotiated the payoffs to Sorenson.

Benton didn't start paying Kesari for "work" at the McConnell campaign until after Fusaro had warned Benton about the developing scandal? Why would you bring in such a radioactive player? And it still remains to be seen what Kesari was actually doing for the McConnell campaign.

That Benton relied on Kesari to do anything beyond licking envelopes is beyond me. Think about it, Kesari used a front company to funnel money to Sorenson that was owned by his wife!!

If you want to use a shell company, the idea is to keep it away from you. You set up tantalizing tidbits that will keep investigators using up time and resources following down noise that will keep them going in circles within circles. You don't use a company that traces back to your wife!

Bottom line: It made sense on one level for Ron to keep things within the family, where you would expect loyalty to the Paul brand to be first and foremost. Benton at best was an incompetent in being able to carry this task out. Personally, it is starting to cost him dearly, but what is sad for the rest of us is that it is going to cause the Ron Paul name to be muddied.

Watergate was about a third-rate burglary. The developing Ron Paul Inc. scandal is, in many ways, about third-rate political operatives.

Get to know the facts of the developing scandal, so that when libertarian-haters attempt to besmirch the Ron Paul name, you will have the facts to show them the limits of the scandal and that it has nothing to do with the advancement of liberty. Afterall, liberty is about freedom, less government and less politics. Hayek warned us in chapter 10 of The Road to Serfdom that the worst get on top in government and politics, especially as society collapses:
[T]he unscrupulous an uninhibited are likely to be more successful in a society tending toward totalitarianism, Who does not see this has not yet grasped the full width of the gulf which separates totalitarianism from a liberal regime, the utter difference between the whole moral atmosphere under collectivism and the essentially individualist Western civilization. 
The problem is that Benton and Kesari (and others in Ron Paul Inc.) hold up the types Hayek warned about, the type the has been brilliantly portrayed by  Frank Underwood, as role models, instead of men of principle such as Murray Rothbard and Ludwig von Mises.

What's worse is that politics also attracts operators who are much more skilled than the Benton-types and the Kesari-types. They are successful at their evil doing. Thus, for pure libertarians, we must do what Ron Paul did not do, cut Benton and Kesari loose (and whoever else may fall in the scandal) and use their opportunistic ways as an example of why all politics is bad and explain what Benton and Kesari attempted to do is simply an incompetent attempt at what Hayek warned politicians are about.

Robert Wenzel is Editor & Publisher of and author of The Fed Flunks: My Speech at the New York Federal Reserve Bank.


  1. Fortunately most commentators have treated the Paul campaign as as a jokey footnote of the campaign anyway and old news. Unless someone with name recognition gets caught up at the center of it, it won't damage the liberty message much.

  2. >But the big question is why put so much effort into pursuing Sorenson anyway?
    A) Son Rand is considered a 2016 Presidential contender, some interests that wish to derail figure may
    ruin the brand.
    B) Ruin the brand of Ron Paul. Why not take out an individual that mostly spoke his convictions, took steps while in Congress that few others elected would do, and remains an active force today?
    Could be more, but those two immediately come to mind.

  3. I agree that the folks running Ron Paul Inc were incompetant nitwits. They are also nitwits for doing things that might bring down the wrath of the feds. However, in reality, what actual crime did they commit? Especially as opposed to, say, making Libya safe for Jihadists and supporting ISIS in Syria?

    The priorities of our society are silly and pathetic.

  4. Justice on you Jesse. Payback is hell. Satchel Paige warned him a long time ago: "What goes around comes around".