The Presidential Race And A Return To The Gold Standard

U.S. Republican politicians, more than any other political animal, like to talk about “balanced budgets”. Because of this, many of these same politicians also make references to returning to a gold standard. Why?

For the answer to that question; we turn to a legendary hater of gold (and the gold standard), John Maynard Keynes. This infamous, economic charlatan famously whined that a gold standard functioned as a set of “Golden Handcuffs.” This begs further questions. Who was being handcuffed? How were they being handcuffed?

It’s actually very simple. A “gold standard” is a monetary system based upon Honest Money. This is a concept which is now almost completely unknown in the Western world. In large part, this is because very few people even understand the correct definition of the word “money”.

Money (as opposed to mere currency) must be a unit of value. This means that either the money itself must have intrinsic value (such as when we had gold and silver money), or it must be backed by a hard asset of intrinsic value, i.e. a gold standard. In a monetary system of Honest Money; there are severe constraints placed upon the economic policies of government.

To begin with; in an Honest Money system, it is impossible for our governments to run up large deficits with their fiscal policy. A gold standard is a system of balance of payments. This is in contrast to the fraudulent fiat currencies of our present economic system. Because these currencies, this pretend-money, is inherently worthless, there are no constraints placed upon the fiscal policies of government. The Handcuffs are removed.

The gold standard operates in a similar fashion with respect to monetary policy. Again, because we are dealing with Honest Money rather than worthless currency, governments (or their central banks) can only create currency in amounts proportionate to the gold reserves of that government. This is in contrast to the reckless (and ultra-fraudulent) currency creation by the Federal Reserve. Below is the last, legitimate representation of the U.S. monetary base.

Such monetary insanity could never occur with a set of Golden Handcuffs firmly in place. It is for these reasons that Republican "pretend-conservatives" also often talk about a return to a gold standard. Conveniently, the mainstream media has specifically identified the five Republican candidates for the presidential nomination who have either directly referred to a gold standard, or alluded to it implicitly.

…Of the 12 original candidates, the idea of moving back to a gold standard has been supported by five; Senator Ted Cruz, Senator Rand Paul, Dr. Ben Carson, Arkansas Governor Mike Huckabee and New Jersey Governor Chris Christie.

Second place in the polls, Cruz has been the most vocal noting, during the Republican presidential debate, that the Fed should be focused on sound money and monetary stability, ideally tied to gold.”

In the same debate, Hucakbee said that the dwindling middle class is the result of the U.S. Fed “manipulating” the dollar. “What we need to do is to make sure that they tie the monetary standard to something that makes sense, rather than to their own whims,” he said.

Christie raised concerns about the impact the Fed’s extraordinary money-printing will have on the economy while Carson noted that the value of the U.S. dollar is based on nothing.[emphasis mine]

Paul has been a long-time supporter of changing the current U.S. monetary policy…in 2013, Paul said he would like to establish a commission to study the possibility of establishing a new gold standard.

But all of that tall talk occurred in 2015 (or earlier). This is 2016. The American people will be voting this year, and those votes will be based upon this year’s “promises”, not last year’s. In the same article, the mainstream media provides us with an update.

However, since the October debate, candidates have been fairly mum on adopting the controversial monetary policy as many economists have lambasted the suggestions.

How convenient. As voting time nears; the pretend-conservatives now back away from proposals to restore “sound money and monetary stability”, and they back away from rejecting the current system where “the value of the U.S. dollar is based on nothing.” And they do so under the guise of “listening to experts.” Let us remind ourselves what we now know about these economic experts, and the other experts upon whom the mainstream media and our political leaders rely.

A twenty year academic study found that when it comes to predictions, so-called experts are as accurate as dart-throwing chimps.

So, a few dart-throwing chimps hurl their feces at the idea of a return to a gold standard, and these Republican “leaders” back away. A real conservative wouldn’t do that. A pretend-conservative would. Here’s a somewhat different opinion on the gold standard, from an economist with somewhat more credibility.

In the absence of the gold standard, there is no way to protect confiscation of savings from inflation [the money-printing of central banks].

• future Federal Reserve Chairman, Alan Greenspan (1966)

I believe it is impossible to be a true conservative and not also favor a gold standard monetary system. In the U.S.; politicians wear their title of “conservative” like a suit of clothes, something which they can remove and change, whenever it’s convenient.