Good Thing or Bad Thing?

Via Drudge and CNBC:

The gold standard has returned to mainstream U.S. politics for the first time in 30 years, with a “gold commission” set to become part of official Republican party policy.

Drafts of the party platform, which it will adopt at a convention in Tampa Bay, Florida, next week, call for an audit of Federal Reserve monetary policy and a commission to look at restoring the link between the dollar and gold.

The move shows how five years of easy monetary policy — and the efforts of congressman Ron Paul — have made the once-fringe idea of returning to gold-as-money a legitimate part of Republican debate.

Marsha Blackburn, a Republican congresswoman from Tennessee and co-chair of the platform committee, said the issues were not adopted merely to placate Paul and the delegates that he picked up during his campaign for the party’s nomination.

“These were adopted because they are things that Republicans agree on,” Blackburn told the Financial Times. “The House recently passed a bill on this, and this is something that we think needs to be done.”

The proposal is reminiscent of the Gold Commission created by former president Ronald Reagan in 1981, 10 years after Richard Nixon broke the link between gold and the dollar during the 1971 oil crisis. That commission ultimately supported the status quo.

11 thoughts on “Good Thing or Bad Thing?

    • I don’t think he is saying it is a bad thing. I see this post as portal for discussion.

      Not my area of expertise, but outwardly I do not believe the return to the gold standard would be a bad thing. But I also think that a path to that end would not be an easy road to hoe.

  1. The value of all gold ever mined is $10 trillion , using a value of 1900$/oz.
    The US national debt is near 16 trillion dollars, and American households owe just over 50 trillion in debt. I don’t see how we can go back to gold standard, given these facts.

      • kells, did it stop them the first time? 🙂

        Greg has a point. By the Gold Standard, we are already bankrupt. However, our currency isn’t really worth much now as it is, and every time they quantitative ease …it gets worth even less.

        So basically, our money really isn’t worth the paper it is printed on. It’s worth our government’s word … and we all know how suspect that has been over the past 4 years. 🙂

  2. The whole purpose of getting America off the gold standard was to make it possible to become a debtor nation. An economy cannot run on debt long-term. History repeatedly teaches us this lesson and we repeatedly convince ourselves that we can get around this natural law (or, in many cases, we don’t care because we know we are on the in-side and can reap all the benefits and leave the costs to those yet unborn).

    As we can see in Europe, and here, too — if we’ll listen to those trying to warn us — the price of our foolishness is about to become due.

    Now, no, we may not be able to get back on the gold standard, but we COULD get on the copper/silver/gold/platinum standard. IF we pulled it off, it would also restore the U.S. $ as the world reserve currency. And the national debt being more than all gold ever mined is not the stumbling block many make it out to be: we simply have to go on a national campaign to eliminate the debt and mine more gold and other precious metals.

    It’s all about maintaining sound monetary policy:

    “All the perplexities, confusion and distress in America arise not from defects in their Constitution or Confederation, nor from want of honor or virtue, so much as downright ignorance of the nature of coin, credit, and circulation.”
    –John Adams

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