The inflated currency isn’t worth a 1,200th of an ounce of gold
The collapse of the dollar to less than a 1,200th of an ounce of gold is emerging as one of the astonishing stories of our time. Yet even more astonishing is the lack of focus on that story by the intelligentsia in our press and politics. It is a silence on which these columns have remarked a number of times of late, including on March 14, 2008, right after the value of the greenback toppled below a thousandth of an ounce of gold. At the time we suggested that, once the Democrats had their nominee, it would be up to Senator McCain to confront them with the fact that the Congress they’ve controlled since 2006 has resulted in the dollar falling below a thousandth of an ounce of gold and to warn of its further collapse without the right leadership.
Now the default that has followed has been bi-partisan. It was less than five years ago that we issued, on December 5, 2005, an editorial called “The Bush Dollar.” It charted the collapse of the greenback to barely a 500th of an ounce of gold from the 265th of an ounce of gold that it was worth when President Bush acceded to the office where the buck – or, to use the phrase that our contributing editor Larry Parks likes, the “paper ticket” that passes for a buck – stops. At the time we issued that editorial, Mr. Bush had just named Benjamin Bernanke to chair the board of governors of the Federal Reserve. We noted that the dollar had continued to lose value at what we called an “astonishing rate.”
So on the eve of the election that gave the Democrats the control of Congress, we issued an editorial proposing the dollar be renamed “The Greenspan,” in honor, or dishonor, of the Fed chairman who’d just written a book that gave short shrift to the whole idea of measuring a dollar in gold. When it didn’t happen, we issued, on November 30, 2006, another editorial, “The Pelosi,” focusing on the fact that it was to the Congress that the Founders of America delegated power to coin money and regulate the value of it. Despite the efforts of Congressman Ron Paul to return to the idea of constitutional money, it rapidly became clear that the Congress wasn’t going to do anything more about the dollar under Mrs. Pelosi than it had under Dennis Hastert.
So in 2007 we proposed renaming the dollar “The Bernanke.” It called the pace at which the dollar was falling “scandalous.” It also quoted Congressman Ron Paul as having, in 2006, written, prophetically it looks like: “Economic law dictates reform at some point,” Mr. Paul had written in the fall of 2006. “But should we wait until the dollar is 1/1,000 of an ounce of gold or 1/2,000 of an ounce of gold? The longer we wait, the more people suffer and the more difficult reforms become.” We quoted Dr. Paul as warning that “runaway inflation inevitably leads to political chaos” and declared that the time for action is now.