Skip to comments.Gingrich: U.S. should reconsider gold standard
Posted on 01/19/2012 12:56:22 PM PST by SeekAndFind
Republican presidential candidate Newt Gingrich is calling for the United States to think about returning to the gold standard.
Speaking at a foreign policy forum in South Carolina on Tuesday, Gingrich advocated a "commission on gold to look at the whole concept of how do we get back to hard money."
Gingrich, a former Speaker of the House, has spoken in favor of a "hard money" policy in the past, but these were his strongest comments to support reinstating the gold standard.
Gingrich would model his "gold commission" after one put in place after Ronald Reagan was elected, when the nation was battling double-digit inflation. But even then, the commission overwhelmingly rejected the idea of a return to the gold standard.
One of only two members of the 17-member commission to endorse a return to the gold standard was Ron Paul, one of Gingrich's rivals for the GOP nomination.
The United States first moved away from the gold standard, under which the dollar was backed by the nation's gold reserves, in 1933, and dropped it altogether in 1971. Despite support for its return by some on the political right, few mainstream economists support its reinstatement.
Chief among the problems is that with a dollar pegged to gold, U.S. goods could become uncompetitive on the global markets compared to goods priced in euros or yen.
The return to a gold standard is a central point in the campaign of Paul, a Congressman from Texas who also advocates abolishing the Federal Reserve.
In his comments Tuesday, Gingrich also spoke sharply against the Fed, saying it should focus on keeping prices in check, dropping the dual mandate of job growth and fighting inflation.
(Excerpt) Read more at money.cnn.com ...
I’m not sure how the gold standard works. What if Russia for example broiught all their gold out of hiding?
I think that it would be BRILLANT for Newt to come out and say that he would appoint Ron Paul to the Fed.
“Gingrich: U.S. should reconsider gold standard”
How about The Gold Band standard . Sorry , you walked into that one .
Ain’t gonna happen and he knows it. Just throwing meat into the gator hole.
Making a play for a piece of Paul’s 15%... interesting...
RE: I think that it would be BRILLANT for Newt to come out and say that he would appoint Ron Paul to the Fed.
Didn’t he already say that he would appoint John Bolton as Secretary of State? (To which in response Bolton went on to endorse -— ROMNEY !)
Well, it’s not a literal need to have XXX ounces of gold for every dollar in circulation, it’s more of a “pegging” of value, much like Carribean countries like the Bahamas do only using the US Dollar itself instead of gold to determine value.
I don’t know what to think about that: putting Ron Paul in charge of the Federa Reserve may not pass Senate approval.
If Newt appointed the three seasoned wise men of economics - Sowell, Laffer, and Willims - to unravel and either reconstruct or abolish the Fed, I would be content with that decision.
Ron Paul as Secretary of the Treasury: now that I think appropriate and likely to pass muster with the Senate.
“Im not sure how the gold standard works.”
Not very well. Which is why we don’t have it.
The big problem with the gold standard is that there is not nearly enough gold in the world to replace all the money without the price of gold skyrocketing to a million dollars an ounce. And try paying for a box of popcorn at a movie with gold at $1 million per ounce. You’d need a pair of tweezers to pay.
Which does not change the fact that appointing Bolton is a good idea, and letting folks know it is a good idea too.
Regardless of who Bolton endorses..
I would ALSO say that we need a full and OPEN accounting as to WHAT EXACTALLY is in Ft Knox.
(May 3rd, 2011) South Carolina Gold and Silver Bills S. 862 (Senator Thomas) and H.4128 (Rep. Mike Pitts)
(June 27th, 2011) June 28th 1PM EST Press Conference Rotonda SC State House
- United State Senator Jim DeMint's US Senate Gold Bill Endorsed by South Carolina Sound Money Committee.
I think he’ll do just that. He’s now directly taking aim at RP supporters. If Monday night’s disparity in debate performance doesn’t bring them around, nothing will. I like a lot of what Ron Paul says (maybe 50%), but the other 50% is out of this world. If Gingrich is really serious about meeting with people and learning from them, all the more reason for him to take THIS page (not all of them), from Ron Paul’s book.
It’s growth I want, good leaders have to grow and take lessons from friend and foe alike (Lest their friends surpass them, and their foes overtake them).
Add Idaho to that list. You can pay property taxes in Idaho with precious metals. Here in Utah, we’re behind in that respect, because only U.S. printed PM’s are technically considered money. (But it does have a bit of a trickle down effect).
RE: Ron Paul as Secretary of the Treasury: now that I think appropriate and likely to pass muster with the Senate.
If Ron Paul isn’t available, I’d settle for Steve Forbes.
yeah, but if you were sitting on a few ounces of gold....what about including silver in the standard? Let us not be crucify mankind on a cross made of gold...
I fine it curious how many people believe the words that come out of Newts mouth. Newts just about the only person I know that has been on every side of every issue and means it.
I'd say - nothing.
It would be decried as racist...
Sad, isn't it.
Well there is also silver, nickel and copper. The point is to back the currency with something. But it is already to late to save the dollar. Imagine going to a gold back doller owning 16 trillion in direct debt and 100 trillion in unfunded liablities. Not going to happen.
Interesting. So you’re arguing for a silver standard. I haven’t thought much about that but it occurs to me that the virtue of gold is that the supply is relatively fixed so that there is little opportunity to increase the money supply too fast. Not so with the case of silver.
Gingrich has a Nut side.
The problem is that too few Americans, today, really understand the role of money as a Medium Of Exchange.
At least it would cut down on government counterfeiting.
I checked an app that compared the inflated values in dollars. Turns out that the dollar has lost about 6/7 of its value since I was born.
“Imagine if the government decided to increase the number of minutes in an hour from 60 to 70. You can hear policymakers congratulating themselves: “People will work longer at the same pay. This will be a boon to productivity!” Or if Washington increased the number of inches in a foot from 12 to 15: “Home buyers will thus get more house for the same price and that will stimulate home buying!” Preposterous? It’s no more foolish than what we and other countries routinely do with our currencies.”
Just remember, when William Jennings Bryan uttered that phrase, he was calling for massive inflation, to allow farmers who had borrowed money to pay off their loans with cheapened dollars.
RE: The problem is that too few Americans, today, really understand the role of money as a Medium Of Exchange.
Over a decade and a half ago China fixed the yuan to the dollar. If there had been any mistake in the exchange rate it would have been flushed out in trade patterns fairly quickly.
Again, to simplify: If you sell a bottle of wine for four loaves of bread but suddenly notice you’re getting only two loaves, you’ll adjust your price pretty quickly to ensure you’ll get those four loaves again.
By fixing the yuan to the dollar Beijing outsourced its monetary policy to the Federal Reserve. And for this “manipulation” Washington politicians and policymakers are in a lather of outrage. This fixing of a measure of value has enormously facilitated commerce—and thus prosperity. During the last 15 years U.S. exports to China have increased 650%, China’s exports to the U.S. almost 670%.
Adjusting a currency does not ultimately improve a trade balance. Look at Japan: The dollar has depreciated 70% against the yen since the 1970s, when we pressured Tokyo—as we are now pressuring China—to appreciate the yen in order to reduce our trade deficit with Japan.
Result: Japan’s exports have grown markedly, and our trade deficit is far greater today than it was 30 years ago.
So Make no mistake: Arbitrarily changing a currency’s value is a form of protectionism. Instead of raising taxes on imports the same effect is achieved by changing prices through currency devaluation. In 1984 one dollar bought 250 yen. Say that a widget cost 250 yen (or $1). If what the dollar could buy dropped from 250 yen to 165 yen, then the price of the widget went up to $1.50. That’s as good as a 50% tariff.
The statists oppose stable money under the gold standard because then the government won't be able to afford the socialist programs that are the source of their popularity with the parasites, that keeps them in power.
It worked until the jackals in D.C. wanted to strip everyone of any real worth...Now, who is it a soda cost $.05 in 1920 and $1 now, or a house for $20k instead of $200k??
The U.S. already does it, but it’s only a ‘collector’ thing to most people; just visit the U.S. Mint to convert your Federal Reserve Notes to U.S. Legal Tender.
And so much for some supposed ‘Conservatives’, but I don’t recall (as The People) giving the Fed the ability to re-write “...To coin money, regulate the value thereof, and of foreign coin, and fix the standard of weights and measures” and print worthless paper.
I’d say it was a damn bit tougher in the years past when we DID have a standard to inflate the value of $$ right out your wallet w/out The People revolting outright.
****yeah, but if you were sitting on a few ounces of gold....what about including silver in the standard?****
For that matter we could include all commodities together. The problem comes with derivatives manipulation. If we eliminate that problem we could have a broad base of support for our currency.
Platinum, gold and silver would seem to be the most stable and reasonable backing. The problem with a gold standard is, of course, that nations holding our currency would immediately seek to exchange their dollars for our gold and our gold supply would quickly disappear. Is that a problem? probably. The bigger question, how would this affect our national debt and our pending budget deficits which are the real anchors holding this economy back. It’s worth investigating but not something I would enter into casually and without serious weighing and measuring.
"U.S. goods could become uncompetitive on the global markets compared to goods priced in euros or yen.
And that's a bad thing?
"Aint gonna happen and he knows it."
What do you know that Forbes and others are missing?
You can PM me if it's a trade secret ;-)
Got that right. The last time anyone from Congress was allowed to view the vault was 1974!!! Its true
“...increased the number of inches in a foot from 12 to 15: Home buyers will thus get more house for the same price..”
I’m no math wizard, but wouldn’t you get less square footage?
“..something tangible needs to back the currency.”
It used to be backed by America’s strength, security and honor. Not any more.
Very interesting proposal! (I’m also a US Navy Vet)
Top gold reserves: http://en.wikipedia.org/wiki/Gold_reserve
The data is a year old, but it gives you an idea what countries are well positioned in the future. Something to consider, there are countries on the list that are on the verge of going bankrupt. The US should position itself to “bailout” those countries by providing US dollars in exchange for gold, preferably below market price. I’ll take buying gold over welfare spending any day of the week and twice on Sundays.
My choice would be weapons grade plutonium (Pu239). Preferably assembled into W88 warheads ready for delivery to answer requests for foreign aid. I also favor restricting suffrage to military veterans and property owners.
GtG (slightly to the right of Attila the Hun)
Lots of good thinking in the replies to this post.
Kinda hard to ignore what the Constitution says on the matter but Congress did/does.
Even a precious metals standard where you couldn’t exchange your paper money for them would be a step in the right direction as it sets up a control to not spend more than you have but Congress always gets around that so you need the rule of law to throw these losers in prison when they try to get around the Constitution, including presidents.
So far Congress has everyone walking scot-free when they steal money and a fine doesn’t mean much when you steal more than you are fined...some punishment that is.
****Platinum, gold and silver would seem to be the most stable and reasonable backing. The problem with a gold standard is, of course, that nations holding our currency would immediately seek to exchange their dollars for our gold and our gold supply would quickly disappear. Is that a problem? probably. The bigger question, how would this affect our national debt and our pending budget deficits which are the real anchors holding this economy back. Its worth investigating but not something I would enter into casually and without serious weighing and measuring.****
Then the only way out is to crash the whole worlds economy and start over with commodities backing a US currency. The biggest problem with that is the call One Worlders for a single currency for all nations. That and there would have to be either a huge war to settle differences, or mutual agreement that all debts are forgiven.
*from One Worlders*
Under a gold standard, the Russians would have cut their own throats by hiding it in the first place. Money buys stuff -- they'd have starved themselves.
A gold standard's by no means a perfect system. It just prevents politicians from printing money at will -- people actually have to go out and dig it out of the ground before it enters circulation.
If gold were money, there would be no price of gold.
The prices of goods and services would adjust. And there would be no need for tweezers -- a paper bill representing a weight of gold could as easily represent a pound or a tweezer-full. Either way -- Nancy Pelosi and Ben Bernanke would have nothing to do with it.
But we would.
Newt is quite clever.
Do your own DD..it will help u understand “money”
also....here's a good read by Greenspan in 1966
The Federal reserve should be abolished and we should go back to the way it was done before the Federal reserve. The Federal reserve has been a colossal disaster.
If its function has been to prevent inflation then it has caused 100 times more inflation then existed prior to the Federal reserve.
Basically the Federal reserve’s way of protecting you from thief is to steal 100 times as much money as any other thief ever has.
It might be hard to make that argument, as under the Federal Reserve the United States:
Became the world's only superpower,
Increased per capital income by 400 percent,
Increased the average lifespan of a citizen by one third.
More than tripled the U.S. population.
I am not a fan of the Federal Reserve, but it is hard to say that it has been a disaster.