Ron Paul's Federal Reserve Audit Bill (Passed)

[Workers-Control-Over-Prod]

I've heard that "getting back to the gold standard" It's not possible now days. Is this true?

There is a reason why the US went away from Gold backing up its currency. In the 1970's, the United States had inflation of the Dollar because of the oil crisis, but the production of the commodity Gold was lagging behind that paper money production and so capitalists got nervous if the US would have enough Gold to secure their assets. The "Gold" standard of money is merely a commodity that theoretically is available around the world, but here is the thing: the US is not the leading Gold producer, South Africa and the USSR were in the 1970's and that was the reason why the US stopped securing its Dollars (to small buyers) with Gold. The Gold Standard would lead to the same deflationary encagement of the US dollar because you simply do not have the capability to produce enough of the stuff once you need to print more paper money Dollars (which will happen soon; inflation). The reason why the Federal Reserve loans out at such cheap interest rates risking inflation, is because the private capitalist economy needs that manipulation to function.

[NewLeft]

The old Bretton-Woods system had gold at a fixed priced. The United States was indebted to France who wanted to convert dollars to gold at $35 an ounce when the market value was $40.

[R_P_A_S]

In my opinion getting rid of the FED would make Capitalism harsher by getting rid of one of the few methods that the state has to buffer boom-bust cycles. There would be advantages to that but it would lead to more suffering I think, despite the damage the FED does already.

What about the whole thing that.. "states can regulate it them selves" no need for some master over lord.. aka the FED

[MuscularTophFan]

"Ending the fed" was one of Ron Paul's biggest propaganda tools for his brainwashed cultist followers.

[Workers-Control-Over-Prod]

Long Live the R3voLution!

[Tim Cornelis]

Ok, this is really a weak point for me, but the idea is that the gold standard will result in a fixed currency. Right now, the fed can print money, which can lower the value of the dollar, and results in inflation(?), or something.

Austrian economists argue that central bank artificially sets interest rates which causes economic bubbles that will collapse at some point, not that it causes inflation.

I recall Paul Cockshott citing numbers which would quite accurately predict what detrimental effects the gold standard would have, but I don't remember exactly what it was.

[¿Que?]

Austrian economists argue that central bank artificially sets interest rates which causes economic bubbles that will collapse at some point, not that it causes inflation.

I recall Paul Cockshott citing numbers which would quite accurately predict what detrimental effects the gold standard would have, but I don't remember exactly what it was.

Interesting. I will definitely google that at some point.

[Sendo]

What I find hilarious is how these Paul followers believe that gold has any more inherent value than a fiat currency. A stake or share in a productive economy is better than pieces of gold. Outside of jewelry and a few uses in the electronics industry what value does gold have? What intrinsic value does it have compared to, say, an apple or a table or a bicycle?

So they think we should use supply and demand to drive up the price of gold to replace fiat currency (if everyone did this there would be no point in national currencies....we'd have....cue horror music...a WORLD currency!)

and

we should waste human labour and resources digging gold out of the ground and storing it and guarding it. Hell, maybe have wars for oil AND for gold now. Why not switch to a diamond based currency. I'm sure Africa could do with another invasion by Western militaries.

For a while I thought Paul was an idiot, but I now see he has carved himself a niche: pot-smoking young Republicans who are disconnected from reality. His racism ranges from a laissez-faire attitude to racists in power to your typical KKK chatter depending on the audience. He is a panderer who peddles snake oil and opiates and he knows it. He is also an opportunist with no principles beyond "enrich good old boys and their ilk and keep out immigrants (excepting the Anglos and their descendants, of course)". The Republicans use him as a release valve for faux-populist pressures from below and as a great tool for bringing up red herrings. Yeah, the "fed" is why there are no jobs in America.

He presents no threat. His followers are at best regionally powerful but generally a bunch of disconnected, non-unionized, non-civic, upper middle class whites. In a country that has so many poor and is due to become mostly non-white by 2020 he is more and more irrelevant.

The man is smart enough to know why other countries don't bandy about gold! gold! gold! He knows he can appeal to that American frontier dream. The wild West. Self-made man. Two gold coins at the saloon will buy you a steak, a shave, and a room for the night. Yeeha

[Paul Cockshott]

The gold standard ties the expansion of the money of last resort to the rate of growth of the physical stock of gold. This is typically been about 0.7% to 1% a year.
The signature of capital is mcm' where m'>m. This requires an ever expanding money stock at the rate of expansion corresponding to the expansion of the embodied capital stock.
If the gold standard is retained there is a mismatch between the growth of the capital stock and that of the gold stock which leads to increasingly severe recessions in order to limit the growth of the capital stock to the rate of growth of the gold stock.

The growth of capital stock is accumulation, and accumulation is closely linked to the growth of the proletariat. Under the gold standard the growth of the proletariat becomes constrained by the growth of gold - this means chronic unemployment and increasing recessions.

Attempts are made to get round this by credit expansion, but as Marx points out in Capital III in a crisis people are unwilling to accept credit or payment by cheque, but only accept payment in gold.

Under the fiat money system, the money of last resort is issued by the state, and its growth can be accelerated at will to the needs of economic expansion.

[Die Neue Zeit]

Under the fiat money system, the money of last resort is issued by the state, and its growth can be accelerated at will to the needs of economic expansion.

I wonder why a couple of Chartalists think that fiat money already ties money to labour hours in the economy.

[DasFapital]

the gold standard works well in Zimbabwe where they literally have to pan for the stuff to buy a loaf of bread. Ron Paul is a fucking idiot.

[Tim Cornelis]

the gold standard works well in Zimbabwe where they literally have to pan for the stuff to buy a loaf of bread. Ron Paul is a fucking idiot.

Zimbabwe has no gold standard, but has considered its implementation. The inflation was, quite clearly, not the result of a gold standard. Since 2009 or so (if I remember correctly), Zimbabwe has 'abolished' their currency and now foreign currency (mainly the US dollar) is used. The country has recovered somewhat since then, and recorded 'stable' economic growth.

[freeeveryone!]

this will probably show that the federal reserve is run pretty poorly. this isn't really notable though. I don't think that anything bad or good will come from this.

[Sea]

It's a distraction, but perhaps may lead to some disillusionment.