The Street: Ron Paul Has a Gold Ally in the Buffett FamilySubmitted by stu2002 on Tue, 05/08/2012 - 12:34
You Wouldn't Know It by Watching Cable News, but ...
Ron Paul is not advocating for a gold standard. In Paul's recent television appearances, he has argued for "competing currencies," rationalizing that since the U.S. constitution names both gold and silver as tender in payment of debts, the concept of "capital gains and losses" should not apply to these precious metals. In essence, Paul is saying that investors should be free to move between currencies without generating a tax bill.
This is a strange concept by today's fiscal and monetary standards, but not unprecedented. During the late 1800s, the U.S. used competing currencies to great effect -- posting strong economic growth -- during a period of overall deflation. Nobel-laureate Milton Friedman, a supporter of an expanding money supply, conceded this point in his book A Monetary History of the United States, 1867-1960.
Alas, you can bet that the next time Ron Paul is on television, the network will superimpose this message: "Ron Paul Supports a Gold Standard." At best, this headline is an erroneous simplification of Paul's recent policy suggestions, which are more nuanced and pragmatic. At worst, the media presents a fallacious portrayal of Paul's ideas that serves to discredit him (whether intentionally or not).
A more honest simplification would read: "Paul: Eliminate Capital Gains on Gold, Silver." But as The Economist once noted, if the media were to take Ron Paul seriously, they would have to "wrestle with a charged set of geopolitical and economic topics they would rather continue helping Americans not understand."