TheStreet.com on Ron Paul and the Gold Standard
In the past, Simon Constable from TheStreet.com has done some mildly positive, mildly misleading stories/articles on Ron Paul and his idea of "returning to the gold standard." I critiqued one of his earlier articles here, and did a followup critique here.
The gist of my criticism is this: Mr. Constable tries to make it appear that Ron Paul wants to "go back" to an inflexible system that was abandoned in the 19th century. Nothing could be further from the truth. Dr. Paul himself has said there were flaws with the past system, and he would in fact like to move forward to a new, commodity-based, honest money system. A 100% reserve gold standard has never, in fact, existed in the United States.
After my first critique, Mr. Constable emailed me, thanking me for my interesting perspective. Recently, he again emailed me with a link to a new video/story that he's done on Ron Paul and the gold standard. In this new video, Mr. Constable interviews random people in front of the New York Stock Exchange. The first question he poses is whether they know what the gold standard is. Woefully, no one does. He then goes on to ask the same ignorant people, "Presidential candidate Ron Paul wants to abolish the Fed and reintroduce the gold standard. Do you think that is a good idea?"
Certainly, there is no point in asking ignorant people for advice on a topic, and certainly Mr. Constable knows that such advice worthless. So why ask it? It appears that Mr. Constable prefers to use their words to subtly ridicule the idea. For example, the first person he shows responding to this question says, no it is not a good idea, but that it's irrelevant since "we don't have to worry about Ron Paul."
Another man responds, "19th century...1800's? I would hope that we've advanced quite a bit since then."
This is a fallacious argument that easily plays among the ignorant, and Mr. Constable does nothing to correct it. Not once in his video piece does he attempt to explain 1) What the gold standard is, or 2) Why Dr. Paul is so adamantly opposed to the Federal Reserve System.
Certainly we have come a long way in our thinking, ideas, science and technological capabilities since the 19th century. However, human nature remains much the same. As such, bankers, governments and politicians still have the same desires that they had in the 19th Century: Bankers to make more money using money alone; governments to exert more control over citizens and property; and politicians to spend more money without raising taxes. The fiat money system of the Federal Reserve allows and promotes all three of these while at the same time surreptitiously saddling citizens with the hidden tax of inflation. As the supply of fiat dollars is increased, each existing dollar is worth less, thus eroding the buying power and saving ability of citizens.
On the other hand, a gold standard contains inflation, enforces fiscal discipline on government, and makes it much more difficult for government to fight needless wars. Under a gold standard, money is worth increasingly more each year as citizens reap direct benefits from increases in efficiency. This is a nearly impossible concept for most citizens to grasp, since all we have ever known in our lifetimes is a currency that is worth less and less each year.
Please let me know what you think of it by posting your comments below.
To his credit, Mr. Constable says at the end of his piece, "I suspect we're going to see a lot more of Ron Paul, and when we do, I'll be covering. So stay tuned..." What worries me is that Mr. Constable will continue with more misleading pieces about Dr. Paul (such as this one) that promote more disinformation than truth. If Mr. Constable is to continue reporting on Dr. Paul, I for one would like to see him give Dr. Paul's ideas a more serious and thorough examination. It would be great to even see an interview of Dr. Paul by Mr. Constable.
At the same time, the video does reveal how woefully ignorant the general public is regarding the Federal Reserve, money and gold, and how this affects them on a day-to-day basis. It is said that the Chairman of the Federal Reserve is more powerful than the President of the United States, because his decisions on monetary policy (though interest rate decisions) affect the average citizensâ€™ house payment, car payment, and whether or not he will have a job. But most people never give that a second thought. This ignorance can easily be manipulated to serve the current powers that be - the government and the MSM.
An educated, fully informed populace is much more difficult to manipulate and fool. As such, I encourage each of you to do your own research on the subject of money, gold, the Federal Reserve, Ron Paul and the MSM. There are many, excellent, independent websites that are not beholden the standard-quo bias of the MSM. A partial list includes:
Your comments on this piece are welcome below. If you are so inclined, let TheStreet.com know what you think about its coverage of Ron Paul and the issue of the gold standard.