Paul Ryan is arguing against quantitative easing here (via), but this seems to be an argument in favor of the gold standard:
“Our currency should provide a reliable store of value—it should be guided by the rule of law, not the rule of men,” Mr Ryan informed Mr Bernanke.
When did all the currency craziness begin? I don’t remember hearing much about going back on the gold standard and such when I was growing up. What caused what we’re seeing now?
mikefromArlington
“What caused what we’re seeing now?”
That Goldline ad I’m seeing on the left side of my screen atm.
Anne Laurie
Remember how Karl Rove, back in 2001, couldn’t stop talking about the McKinley administration as the pinnacle of Real American Glory(tm)? The goldbugs still haven’t forgiven Bryant.
mrmcd
Gold buggery isn’t really new. What’s new is the new GOP standard of co-opting every crackpot conspiracy theory and delusional economic or scientific theory they can unearth.
I look forward to finding out which Republican will be the first to claim that Time Cube is the solution to our deficit problems.
Chyron HR
Laws written by the Law God, I guess.
BR
I think we’re hearing a lot about it because of the debts the GOP ran up in the last 30 years.
Dave
It’s part of the code of new crazy right. Non-fiat currency means the government has to maintain adequate specie stocks to pay off anyone who cashes in their money for gold. Which limits the amount of money the government can print. Because if you print past the coverage, you get hyper-inflation. Which is another of their insane worries. So in their theory a specie-backed currency limits government growth and prevents inflation. Which means none of these idiots remember what happened in the 70s and why the US had to get off the gold-backed currency to begin with.
Lee
Having grown up in Texas, I’ve heard this my whole life. I am 45 years old.
fraught
The guy who shot Gabby Griffins was a currency fanatic. Also, Midas Mulligan in Atlas Shrugged provided gold currency for the residents of Galt Gulch and you know all the CPAC-ers are carrying a copy of it on their IPhones to which they frequently refer whenever they need to refresh their outrage.
SteveinSC
Well for what it’s worth, back in the 60’s I remember worrying, as a late teenager, about all this “deficit spending” I had been hearing about and that the noble dollar was being undermined. At that time one of Kennedy’s Whiz Kids (one of the Bundy’s, McGeorge, I think) was quoted in Time and said not to worry, because if anything happened it would be gold which was devalued.
BR
@fraught:
This is a bit off topic, but I always wonder why “conservatives” don’t boycott Apple or Google or other tech companies. These companies are all based in the SF bay area and are liberal through and through (with a small smattering of techno-libertarians). Every once in a while they complain about Google, but it’s almost always symbolic and it goes away fast.
I suppose, though, it’s not that unlike liberals not boycotting oil companies. (Though I do my part by not having a car.)
Culture of Truth
When you were growing up America was a dominant super power.
NickM
I don’t know specifically when this became an obsession of the right, but I do know it’s been a hallmark of wingnut thought since at least the foundation of the John Birch Society. We’re all hearing a lot more about it now because that type of lunatic is actually getting a platform in the mainstream. The origins of the gold standard fixation derive it seems from concerns about cabals of “greedy bankers” *ahem* becoming wealthier through currency manipulation, and/or the concern that printing money without gold backing allows for government to more easily redistribute wealth.
Ash Can
Maybe Ryan was thinking of the popular corruption of the Golden Rule — them what got the gold, make the rules.
J.W. Hamner
Yeah, there have been Austrian nut jobs pining for the halcyon days of the 19th centuries for ages: when Depressions weren’t just a problem, they were a way of life!
You would to have had to run in more libertarian circles to run into them before they got mainstreamed by Ron/Rand Paul.
Though to be fair to libertarians, most of them think the gold bugs are nutjobs too.
Jack Bauer
It’s an easy idea to understand. Goldbuggery.
The idea that the money you have should equal a set amount of gold. And it never changes.
It’s that vs our incredibly impenetrable financial and currency markets, controlled by unelected galtian overlords. It’s all very hard to understand. Comparatively.
What cracks me up is the close relationship Greenspan had with Rand doesn’t satisfy the libertarian goldbugs I know one bit.
Suffern ACE
When? Probably about the time gas prices shot up to $4 per gallon and the financial markets collapsed. The only “conservative” economists who “got it right” and “predicted the bubble” were also gold bugs. Of course, they had been predicting collapse every year since 1974…
Kiril
If you’re asking why suddenly everyone is on a gold kick the last couple years, it was Ron Paul. Paul supporters suddenly started blathering about the Fed and how money wasn’t worth anything in 2008 during the primary. Paultards–>Tea Party–>Fox/Beck–>new Republican mainstream.
mr. whipple
Yup. I think we hear about more now because Birchers didn’t have websites and a ‘news’ network.
Culture of Truth
If the GOP ever drops the homohobia, will the new credo by “God, Gold & Guns”?
Napoleon
The current crop of GOP officeholders are so stupid and extreme things like this manage to take hold, something you never would have seen with a Nixon or Ford.
geg6
Beck loves him some goldbuggery.
Comrade Javamanphil
@BR:
Because very few of them actually believe the shite they are peddling.
A Commenter at Balloon Juice (formerlyThe Grand Panjandrum)
The same thing that causes people to scoff at global climate change because it snowed this winter. Ignorance.
Suffern ACE
@Kiril: Shhhh. It can’t be Ron Paul types. They are against the war.
BR
@Comrade Javamanphil:
Well, that would explain it.
Culture of Truth
9/11 —> two wars —-> financial crisis —> black president –> marxist/kenyan takeover —–> collapse of society —> Rapture —> Gold!
fraught
@BR: Many libertarians are stuck back in the days of “Real” industry, like steel companies and railroad conglomerates. They really can’t figure out if tech companies are subverting tenets of capitalism because they still half believe that there is no “product” there and there seems to be no threat of the gov’t nationalizing them except from inside their own house. There’s very little Randian writing on tech companies so they can’t imagine that altruists would actually want to make a lot of money and not see that as purely a matter of self interest.
p.a.
@mrmcd:
just so. gold quackery has been around since we went off the gold standard, it’s just that as the Republican Party descends into lunacy, quackery is a distillate that becomes mainstream, public.
I think Steiglitz said (paraphrase): “if someone on another planet watched us dig gold out of the ground, melt it into pretty shapes, then put it back underground and pay people to then guard it, they’d think we were, as a species, crazy.”
BudP
smugnorance (noun) \ˈsməg-n(ə-)rən(t)s\
: the state or fact of being ignorant coupled with the certainty of correctness: pride of lack of knowledge and education
The new guiding principle of the Republican party is smugnorance.
electricgrendel
People became demonstrably more stupid.
PanAmerican
Didn’t Steve Forbes repeatedly run as a goldbuggerer before it was cool?
JGabriel
DougJ:
Again I will point out that people who hate global standards are, when they insist on a gold standard, arguing for a global standard. Fucking idiots, I swear.
What is their problem? Why is it so hard for them accept that the dollar is backed by the goods, services, and labor we exchange it for every day? It’s bizarre.
.
Zifnab
@Napoleon:
Are you kidding? Nixon would have been first aboard the gravy train. I’m just thankful that someone of his leadership level hasn’t seen the inside of the GOP in the last fifteen years.
The Gold Standard goes back to the post-Civil War period, when the line between populist and corporationist was a lot clearer. During the 1890s, you had McKinney squaring off against William Jennings Bryant in a fight to repeal the Gold Standard. Basically, the issue revolved around farmer debt. Farmers would take a loan from a bank to buy equipment and seed and run their farms. With inflation, the debt owed the bank (minus interest) would be worth less than the farmer originally received. But the gold standard hobbled inflation. Some years, you actually had deflation. In a deflationary year, crop prices would fall, the value of the debt would rise and waves of farmers would default on their debts and lose their farms. (Kinda like in the last housing crisis, but smaller and cyclically).
When Bryant championed the Gold Standard, he was really championing the interests of the farming class by advocating for inflation.
After that, the gold standard became synonymous with banking and the owner class. Inflation and other monetary reforms were championed by the debters in the working class. Guess which side Rand Paul’s Gold Bugs stand with?
Napoleon
@p.a.:
That is the funny thing. Gold really does not have the intrinsic value that supports the value people put on it. Other then some electronic uses it really is a useless metal.
RalfW
If you are planning a massive federal default on debt, you damn well better peg your currency to gold, or the dollar will be equal to a peso.
As in, about 8.7 cents.
PeakVT
it should be guided by the rule of law, not the rule of men
Somebody should tell the dumbass the currency is already guided by the rule of law – specifically, The Federal Reserve Act, which was passed in 1923. And that law works great, as long as Republicans (and whores like Larry Summers) aren’t messing with our financial regulatory system.
What Ryan is arguing for is some inviolable supernatural law that prevents humans from using their brains. Or at least that’s what it looks like. What he’s really arguing for is for the rich to be able to benefit from a constant state of very low inflation or deflation.
Kenneth Fair
Don’t forget that the Koch brothers have been funding this nonsense for a long time. Their long-term project to have the John Birch Society take over the Republican Party has largely succeeded at this point. That’s why the crazy is breaking into the mainstream.
NickM
@Zifnab: I’m afraid you got this backwards: Bryan believed in “free silver” and believed that farmers were being crucified on a “cross of gold” – hence his famous speech of the same name.
Zifnab
@NickM: Gak. Thank you. I meant to say Bryant championed the repeal of the gold standard.
Blargle.
Sebastian
Would you still be of the same opinion if you knew that Richard Nixon axed the gold backing of the dollar? It allowed unlimited creation of dollars by the stroke of a pen.
It was the kick off for the insane bubble economy we saw the last 4 decades and the motivation was – what else? – to impoverish the middle class.
Tom Levenson
Isaac Newton on specie vs. paper:
“Tis mere opinion that sets a value upon [metal] money…we value it because we can purchase all sorts of commodities and the same opinion sets a like value upon paper security.”
So — who you going to trust? Paul Ryan or Isaac Newton?
I’m sticking with my man ‘Zack.
dragonflyeye
This seems to be a back draft from the Ron Paul wing of the Republican Party. He talks a blue streak about it to anyone who will listen. And since he caused a furor with a lot of crossover to the Tea Party, it just kind of seeps in there.
Of course, what they don’t explain is that wealth is arbitrary: you only have wealth because you have something others want, be it dollars, gold or webbed feet. GDP-based wealth can be scary, especially to the debt-averse, but the alternative gold standard is a recipe for world war.
Because arbitrary rules of wealth on abstract concepts can generate limitless wealth, but arbitrary rules of wealth on a finite resource mean someone’s going to have to take the resource to get the wealth.
Suffern ACE
@PeakVT: He’s not talking about man’s laws. Gresham’s Law, or God’s Law, or Natural Law. Take your pick.
Kirk Spencer
@fraught: No, not even that. It’s mercantilism – that economic methodology/principle to which Adam Smith (among others) objected, that dominated the 16th through 18th centuries.
The idea that labor adds value was a new-fangled idea. The idea that there as worth in intangibles was, for most of the merchant princes, inconceivable. Commodities, and especially commodities that could not decompose or degrade, were the proof of wealth.
That, by the way, is why gold and silver. They don’t rust or rot. Once silver forms its tarnish layer it doesn’t degrade further.
Chyron HR
@Tom Levenson:
ISSAC?! That sounds like an “International Banker” (wink wink) name if I ever heard one.
AliceBlue
Jack Kemp was always yammering about going back to the gold standard. That’s the only thing I remember about him.
PTirebiter
I remember my parents ranting about gold in the early sixties.
We lived on the border of Orange County when the JBS was very influential there. They subscribed to the Dan Smoot Report and our Austin Healy sported an Au H20 ’64 bumper sticker. Good times.
artem1s
@Napoleon:
shiny dirt. there are other metals that are far more useful in electronics. the value of iridium has about quadrupled since the 80s mostly because we are using it more. platinum took a huge leap after the use of catalytic converters became mandatory. columbite-tantalite is pretty much indispensable in electronics and making cell phones.
gold has been useful as standard mostly because it had no other value. The trading rate was highly regulated when it was used as a standard because it wasn’t subject to a lot of supply and demand fluctuation as critical supply in manufacturing. the wingnut obsession with hording it has made its trading rate extremely volatile and ironically unusable as a currency standard.
Kirk Spencer
@Sebastian: Riiiight. And the fact that France was exchanging francs for dollars with other nations, then demanding exchange of dollars for gold from us due to our gold backing, didn’t matter.
Oh, and bubble economies existed before Nixon removed the gold backing requirement. See for example what led to the Panics of 1873 and 1893.
scav
whoa, ≥spit-take≤. Can it possibly be our favorite once-upon-a-time wackadoodle from CR? Certainly as unconvincing as the gold-plated original.
Judas Escargot
The gold standard favors the rentier/”owner” class (by hardening their assets). It also limits overall monetary growth.
In other words: If you’ve got yours, a gold standard both freezes the value of what you’ve got relative to everything else, and simultaneously makes it even harder for others to get theirs.
So yes, if you’re a neo-feudalist, you’re going to be a big fan of the gold standard.
BTW my second biggest fear of this Congress (the first being the upcoming debt ceiling debacle) is that they will f_ck with the currency in ways we’ll never recover from.
Sly
When economic circumstances demanded greater outside intervention.
Personally, I think they’d prefer going back to an era where guys like J.P. Morgan could save the economy. But the Great Depression ended that possibility; the U.S. economy had become so large and integrated that the possibility of one or even a handful of private actors “saving” it in times of crisis became implausible.
Conservatives have always resisted any kind of imposed order on economic life (largely because then economic life might be, horror of horrors, fair), even central banks. Milton Friedman convinced them that central banking could be conducted by a technocratic elite that would be immune to political pressures. What conservatives didn’t understand was that this technocratic elite, by definition, had to operate under a systematized body of knowledge and use that knowledge to explain current circumstances and make predictions based on available data.
You know… science.
The reason why central banking is losing its grip on conservatism is because, rather plainly, they no longer have confidence that it is being run by one of their own ideological purists. Its being run by one of those pointy–headed academic types who actually looks for and values evidence.
liberal
There are some arguments, when taken generally enough, are pretty reasonable. Right now, banks can create credit out of thin air and collect the interest.
Which hardly seems fair. I’m not that familiar with monetary systems, but AFAICT a gold standard is neither sufficient nor necessary for either getting rid of this privilege, or charging for it.
Maude
@Zifnab:
I was wondering if I had been wrong in thinking that the Republican Party at that time was a gold party. It has been written that McKinnley won partly because of this.
McKinnley was a very interesting man. The biographers seem to be doing books ont he same few presidents over and over.
Ida McKinnley was a brave woman.
liberal
@Sly:
Maybe in comparison to the far-right nutjobs, but he didn’t exactly acquit himself well while the housing bubble was building.
tomvox1
Well, FDR took us off the gold standard, so that could have something to do with it. But then so much of what passes for “modern Republican thinking” is really just regurgitating discredited 19th-century theories on governance, the role of the state, monetary/regulatory policy, etc.
So its hard to say for sure except to believe that:
A) they’re not very bright and don’t know anything about history (or most of the topics they are holding forth on) and
B) they are being paid handsomely to spout this antediluvian nonsense.
A & B are not mutually exclusive, of course.
Maude
@Zifnab:
Nixon removed the gold backing of the debt the US owed.
The Gold Standard was removed in 1933.
Since the US started, currency has been an issue.
Cat Lady
Goldbuggery is just another form of fundamentalism. Goobers don’t like intangibles in general or the idea that currency’s value is relative to factors beyond their control. Gold is as sure and basic and quantifiable as they believe their God to be. It must be scary to be them and unable to process the interrelated complexity of the world we live in – you know, morons.
scav
The Golgafrinchan Standard Leaf. That’s the ticket! Problem solved.
cyntax
As a number of commenters have pointed out, a lot of this is driven by people’s reaction to the complexity and opacity of our current financial systems. That and the general distrust/suspicion that the bankers and the Fed are screwing us, which isn’t an inaccurate assessment. And it fits in with the general conservative solution to stand athwart whatever complex issue is at hand yelling “Stop!”
Conservatives use up all their imagination on ratfucking, leaving little for coming up with workable solutions. Having said that, anyone who bought a bunch of gold 5-10 years ago is doing alright.
JRon
I’ve often wondered how prosperous we’d be today as a nation if global commerce wasn’t essentially based on the dollar. I think if we went the route these goldbuggers have been arguing for, we’d likely have less debt, but a much lower standard of living.
Investing in dollars is still safer than investing in gold. We control the world’s dollar supply, not the world’s gold, which suggests that a shift of this nature would have the effect of transferring a bulk of our power to other countries.
Maybe this is part of their “starve the American beast by bankrupting us” philosophy.
IrishGirl
That’s not a hard one to answer….It’s always been an issue for the John Birchers and it’s coming back to the surface (like pond scum always does) because of the Koch’s bros influence.
Bill Arnold
One intellectual foundation for gold buggery is that inflation is a tax on wealth. So there’s the assertion that inflation caused by deliberate manipulation of fiat currencies is a deliberate indirect tax on rich people. Taxes on rich people are bad.
Also, Glenn Beck, and the various ads related to gold that saturate many cable channels.
Sly
@liberal:
Bernanke’s flaw was in thinking that a decline in housing prices would be small enough to handle, because he failed to see how integrated into the larger economy the mortgage market had become. He always maintained that the Fed had the authority to use its power to fight deflation, and that it should, just that it was likely not needed. That’s pretty much textbook Friedman. That the Central Bank had developed enough expertise and precision that economic shocks could and would be permanently avoided. What was left was minor turmoil, which the Fed had enough expertise to mop up after it hit.
So, yeah, Bernanke can be faulted for buying into a lot of the bullshit that Friedman peddled. But there are two things that I think mitigate this, to at least some extent: The first is that the Fed has been operating under the scenario where fiscal policy is either tightly constrained or non-existent for decades. This is, of course, a byproduct of the (over)confidence in the tecnocratic ability of the Fed. Fiscal policy just wasn’t needed anymore. Bernanke also bought into this, but certainly not to the extent of Greenspan.
Which leads me to the second reason: Bernanke is largely cleaning up Greenspan’s mess. And Greenspan made one hell of a fucking mess. I have a soft spot for people who are stuck in those kinds of situations.
nancydarling
Would those of you out there with more knowledge than I, critique my answers to the following questions which are part of a discussion with a conservative acquaintance?
Why do we need the federal reserve?
The Federal Reserve controls the money supply, regulates national banks, acts as a clearing house between banks, regulates consumer credit, and acts as the lender of last resort to member banks. Until the Federal Reserve system was created a 100 years ago, the US banking system was plagued with financial panics. It is not automatic that they will do a good job. It is generally agreed that the Fed increase in the money supply in the 1920s led to the stock market bubble and the crash of 1929. The Fed made it worse by failing to lend to the banks or buy the federal debt that they held. This caused the banks to fail because they ran out of cash to pay panicked depositors. I believe that the loose money under Greenspan is partially responsible for our current situation. The lack of regulation, greed, and stupidity are the other culprits.
What would happen if we went back on the gold standard?
Miners would control the money supply. If they found and mined a lot of gold the supply of money would go up. If they did not the money supply would stagnate. In the first case inflation would result. In the second a recession or depression. The money supply needs to grow to meet the needs of an expanding economy. It needs to decrease or hold steady to fight inflation.
Sentient Puddle
@Sebastian:
Y’know, if I were alive in 1971 and knew a thing or two about economics of the day, Nixon would have given me a fucking heart attack when he did that. And now I look back and think that this was one of the most inexplicably shrewd moves of the past century or so.
Oh Nixon, you’re a tough nut to figure out…
Sly
@tomvox1:
Or they’re just assholes. For instance, anyone who believes that the United States was a freer society in 1800 or 1900 than it is today is a gigantic asshole.
chopper
the thing i don’t understand about the goldbuggers is, do they actually realize that there isn’t enough gold on earth to make the gold standard actually work anymore? or do they actually think 30+ grand/oz is going to make gold-backed currency flexible?
our currency is backed by a commodity. it’s called oil, and it’s been backing our currency since we made the deal with the saudis in the 70’s. the price of oil isn’t very stable any more but at least you can actually do some real shit with it that isn’t computer circuit connections and bling. going to gold aint gonna make the situation better, it’s going to make it way worse.
wingnuts make my head hurt.
Matt
Birchers have been ranting about the gold standard pretty much since there *were* Birchers. The difference is that the modern GOP has decided to let them talk instead of keeping them in the back room ala The Gimp like they did for most of the last couple decades.
rickstersherpa
One of the amazing things I find today is the the complete indifference among the Republicans and the Village (see today’s by David Brooks pining for a coalition of liberals to cut social security) the following facts from Dean Baker in his Beat the Press Blog:
Structural Unemployment: Does Anyone Care About Evidence?
Wednesday, 09 February 2011 05:41
Most news outlets have given considerable space in recent weeks to the argument that the U.S. economy suffers from structural unemployment. This means that the reason that people are unemployed is that they lack the skills necessary for the available jobs. This contrasts with the idea that the unemployment is primarily cyclical, which means that it is the result of a lack of demand in the economy. This issue is central to our understanding of the economy since it effectively raises the question of whether we blame unemployed workers for lacking the skills needed to get a job or we blame policymakers for lacking the skills needed to run the economy.
The evidence for the structural unemployment argument has mostly been anecdotal — interviews with managers who complained that they could not hire people at the wage they wanted to pay. The news reports on structural unemployment have not sought to look for the sort of data that would support this view of the economy, such as evidence of rapidly rising real wages for some occupations or a large increase in job openings.
One item that had been cited as supporting the structural unemployment view was the modest increase in the number of job openings from the trough of the downturn in the summer of 2009. Job openings had risen by close to a third from their low, although they were still down by more than 25 percent from their pre-recession level. Openings also never rose above 25 percent of the number of unemployed.
In any case, given the importance of the job openings number for those making the structural unemployment argument, it might have been expected that the release of data from the Labor Department showing that the number of openings had fallen for the second consecutive month would have gotten considerable attention. Instead, it merited just a few small pieces or blognotes.”
Sentient Puddle
@nancydarling:
I think you’re more or less spot on here…a central bank acts to help absorb shocks at lower levels and not let them turn into giant panics. One other reason is that if the currency isn’t backed by a commodity (i.e., pretty much every economy in the world), a central bank is necessary to give the currency any sort of fundamental value. Although if you’re dealing with goldbugs, they’re probably not far enough along to want to hear something like this.
I think you’re theoretically right about miners controlling things, but I’m not sure if that’s quite how it’d play out in practice…I’d probably just abstract that bit out and say that the currency would be incredibly vulnerable to supply shocks, which functionally is the same thing and comes across as a bit less nutty.
I’d tie this bit in back to the Federal Reserve bit:
If you peg your currency to gold or another commodity, you’re essentially tying your hands, and can’t do these things. This was actually another problem of the Fed during the Great Depression. Because we were stuck to gold, the Fed was stuck with pro-cyclical policies, which is a bad thing to be doing in a terrible economy.
Kirk Spencer
@nancydarling: What would happen if we went back on the gold standard?
The government would confiscate all gold. More accurately it would implement a form of eminent domain, paying for the gold at “current” rates at best, more likely at a discounted rate.
Here’s the simple deal gold bugs keep forgetting. Money is the lifeblood of a nation. No nation can long tolerate having the majority of its lifeblood in the hands of others and expect to continue existence.
(As an aside, this is why I expect to eventually see the big banks pulled up sharply. Their credit practices created defacto money with the majority of it outside the control of the government. There’s a quiet fight for survival between banks and the current government in progress. If banks win they’ll become the new government. At this point I don’t think they’ll win.)
nancydarling
@Sentient Puddle: @Kirk Spencer: Thanks guys!
Judas Escargot
There’s a quiet fight for survival between banks and the current government in progress. If banks win they’ll become the new government. At this point I don’t think they’ll win.
I agree with your first point (IMO it’s the main driver of our current narrative), mostly agree with the second (banks seem to want to replace the petro industry as the power-behind-the throne)), and wish I could agree with you on the third.
What convinces you that the banks will lose? (And please don’t misunderstand… I want you to be the one proven correct, not me).
A Farmer
@tomvox1:Actually, I believe that FDR devalued the dollar against gold, going from $21.67 per oz to $35 per oz, and banned the private ownership of gold in the US. Nixon took us off of the gold standard in 1971, I think. The government confiscation of gold in 1933 is one of the many reasons for which goldbugs hate FDR.
tomvox1
@A Farmer:
On FDR, ot sure if this is purely semantics or not but…
And on Nixon:
So could be we’re both right… Don’t hear the goldbuggers bitch about Nixon that often, though, do ya?
mds
I like the next part of Ryan’s blabberings more than the “rule of law” bit:
Yglesias has some fun with that, since anyone who isn’t a goddamn idiot like Ryan can effortlessly think of plenty of more insidious things a country can do to its citizens. Hell, some of those things are ardently supported by Paul Ryan.
The other reason I enjoy the statement, though, is all the opportunities for restating his devaluation fears. “There is nothing more insidious a country can do to its citizens than …”
“… make those citizens’ debts less crushing.”
“… increase the attractiveness of its exports.”
“… reduce its trade deficit.”
“… make its own workers’ wages more competitive in the global labor market.”
Etc, etc.
Sentient Puddle
@tomvox1: I don’t fully understand the difference myself, but I think the difference is that what FDR did was more transitory than an actual full-on abandonment of the gold standard. The dollar was still convertible to gold, but he made it really friggin’ difficult to actually do so. So that was a big step toward fiat money, and it gave the world some idea of what to do now that they knew a gold standard was unworkable.
Nixon completely ended convertibility, which was also a big important step because the economic model at the time was a sort of watered-down gold standard, where the US dollar was on gold, and everything else had a fixed conversion rate to the dollar. Cutting gold from the dollar kind of made everything not really backed by anything (and this is the part that would have given me a heart attack at the time, because I really have no clue how this ended up working other than maybe the sheer determination of the world not wanting to fall into economic ruin).
But yes, the goldbuggers should damn well be bitching loudly about Nixon too if they want to be consistent.
Phoenician in a time of Romans
@Kirk Spencer:
There’s a quiet fight for survival between banks and the current government in progress. If banks win they’ll become the new government. At this point I don’t think they’ll win.)
Have you considered that the best explantion for the last few years is that they won some time ago?
Go read Nomi Prinz “It Takes a Pillage”.
Perfect Tommy
States jumping on the gold/silver currency bandwagon:
http://www.itmtrading.com/blog/2011/01/gold-and-silver-as-alternative-currency/
uptown
Because gold is such a reliable store of value, not ruled by men.
Hahahaha…
uptown
What’s all this talk about “rule of law” from Paul Ryan’s mouth? Thought he was against regulating the financial markets.
Kirk Spencer
@Phoenician in a time of Romans:
Phoenician first – an excellent book, but it starts with a premise and tends to pick to prove that premise, ignoring contradictory information. I think the current tribulations indicate the war is happening, not that they’ve won.
@Judas Escargot:
Simplistically, it’s because they haven’t won already. Banks are big. Nations are, as a rule, bigger. The banks have been surprisingly sloppy, not least because we’ve been lax and complacent. But they failed to seal the deal.
I think it’s because in the end they let their greed take primacy. The ability to have much “now” overrode the patience needed to bring it all together for future victory.
It’s not a sure deal, mind you. But at this point I do not give the banks the odds.
johnny walker
@Sebastian: Awesome. My second-favorite thing about goldbuggers and various other low-info tinfoil hat types has always been the completely unjustified “I am in possession of secret knowledge that others lack” attitude, ie. portraying something that’s taught in high school history class as a piece of knowledge that would lead to rioting in the streets if it got out. Wow, Nixon took us off the gold standard huh? Interesting stuff. Why isn’t he President anymore? I’ve never heard of the guy before and it’s not like there’s any way of looking up things that happened before I was born.
(My favorite is the closely-related habit of acting like familiarity with 9th grade-level history, civics etc. makes them the smartest people on the planet, which to this guy’s credit he doesn’t seem to be doing.)
DPirate
@JGabriel:
That is not hard to understand. What is incomprehensible is how our goods, services and labor increased by so many billions at the height of an economic collapse, and how economic collapses have only served to increase our goods, services and labor while impoverishing the great majority of us.
Yes, it is.