This story is interesting. The Republicans say they want to set up a committee to consider returning to a gold standard. Summarizing, they might think about thinking about returning to a gold standard.
The Republicans are trolling for votes, pandering to the growing Libertarian/Austrian faction. They are not making any concrete promises, merely a vague promise to maybe think about it.
That article contained a common fallacy.
Plus, there’s not enough gold in the world to support such a system, as Bernanke noted in a lecture earlier this year.
The idiot calculation is “The size of the economy is greater than the total amount of gold. Therefore, a gold standard doesn’t work.” That assumes each ounce of gold changes hands only once a year. Each gold coin can change hands multiple times per year, allowing an economy much greater than the gold supply. When individuals have the right to convert to gold, that forces honesty in the financial system. Gold is a benchmark for price, even if physical gold does not change hands for every transaction.
In a truly free monetary system, both gold and silver would be used as money. Gold would be used for large transactions and silver for small transactions. All State bimetallic standards failed, because the exchange rate for gold:silver was fixed. Usually, gold was undervalued and silver was overvalued. This created arbitrage opportunities for banksters, when the bimetallic standard was adopted and abandoned. A bimetallic standard can work, but exchange rates would have to float. Any contract must specify payment in gold or silver.
If politicians want to make gold and silver as money, there’s an easy solution. They could repeal all capital gains taxes and sales taxes on gold and silver. They could declare that gold and silver are legal tender based on the current spot price. That could apply to just American Eagles (issued by government) or to all bullion coins. To avoid inconveniencing businesses, a small transaction fee could be added when people trade gold/silver for paper.
The exchange rate between gold and silver and paper would float. That would allow people to use gold and silver as money, without defaulting on the paper money already in circulation.
Technically, the capital gains taxes and sales taxes on gold and silver are already Unconstitutional. However, judges can do whatever they want. They have kidnapped and tortured people for refusing to pay those taxes and for treating gold and silver as real money. Whenever someone makes it easy to buy and sell gold/silver, that is a threat to the State banking monopoly.
Also, gold and silver warehouse receipt banking should be legal. Theoretically, it’s legal now. It’s so heavily taxed and regulated that it’s an infeasible business. If a warehouse receipt bank has to pay 2%+ per year in regulatory overhead, that isn’t a viable business.
In the present, you can’t walk into a bank and trade your paper for gold and silver. That isn’t because “It’s hard.” The taxes and regulations make such a business infeasible. In China, people have greater monetary freedom. In China, you can walk into a bank and buy or sell gold or silver. Banks could charge a small transaction fee, when converting from paper to metal.
There is zero chance of real reform. Insiders would never allow it. Banksters and politicans would lose their ability to rob via inflation. It’s better to make vague promises, rather than promising meaningful reform.
Although they won’t publicly admit it, inflation is a huge profit center for the State. If individuals can easily use gold and silver as money, that would ruin the State financial inflation racket.
There’s a lot of propaganda against using gold and silver as money. State insiders make a lot of money via inflation. It’s a huge hidden tax. I’m able to think correctly about money. The propaganda is pathetically obvious, but it still fools the sheeple.
Republicans made some vague statements about gold. They are pandering for votes, without promising anything tangible. There’s a simple solution for returning to using gold and silver as money, without defaulting on the current paper money. If they’re serious, they should repeal all taxes on gold and silver. They should declare that gold and silver are legal tender based on spot price. Gold and silver warehouse receipt banking should be allowed. There is zero chance of this actually happening. State insiders make a ton of money off inflation. To keep this inflation theft coming, they spread lots of propaganda against gold, and they make up lots of excuses for why inflation is beneficial.