Saturday, March 10, 2012

The Case For Gold

A Minority Report of the U.S. Gold Commission

Ron Paul
Lewis Lehrman

Finished Reading: 02.2012

Written only a decade after the U.S. went completely off the gold standard in the early 1970's, the plunge into the deep end of full bodied fiat money was fresh in the minds of the authors. The hard money crowd was still dripping wet and pissed. Interestingly, thirty subsequent years have passed and our economic picture has not improved on the whole.

The authors describe in great detail the history of the economic system of  the United States, including various high and low moments, and warn against the present spin away from a gold standard and the imminent economic destruction we might come to expect. Simply stated, money backed by gold has real value because gold has real value. Money not backed by gold is only worth what the people in charge say it's worth, and that's not very comforting.

There have been various dark moments in history when a sovereign nation, such as our own, neglects to back its currency with gold for one reason or another. This was once the exception rather than the rule, though its occurrence has been maddeningly reoccurring. The point of view taken by the authors is only the minority opinion, then as it is now, but history will play out and opinions will no longer matter.

Economic destruction follows the debasement of currency after a short period of popular improvement, as has happened to the dollar and other currencies before. The Civil War and the Great Depression are two notable nodes in our national timeline which may not have been such sticks in the mud if policy decisions had been made differently in regards to the currency. Following that war and then that depression, there were periods in which gold shown a little brighter than they had before or after, and our nation was better for it. The authors warn that we are yet again in an economic tailspin that is in part caused by official disinterest in gold which could be cured, at least in part, by a new gold standard in one form or another.

We've seen many changes since this book was first published, but Ron Paul, who has run for president three times, has the same message because our problem are the same. Sadly no one seemed to be listening then as they are not listening now. Today, only gold is "good as gold."

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