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Koch Whores / March 29, 2011

Does anyone here in this house speak goldbug-babble? Anyone who can make sense of Dr. Paul’s logic in the clip below, I’m curious what the fuck this man is trying to hawk to  his 1988 C-SPAN viewers. I mean I know it’s snake-oil, but even snake-oil pitches have a logic to them. This one just sounds like bat-shit blather.

As far as I can tell, the reason why the Koch brothers hire tools to promote the gold standard is the same reason that robber barons of the 19th century loved the gold standard so much: Gold locks in the power and wealth of those who have all the power and wealth; and gold locks out everyone else who’s not so lucky, condemning them to serfdom. Which leads to Populist uprisings, labor unrest, and all that century-old misery. That would explain why Koch fronts like Ron Paul hustle the gold standard to us suckers as the equivalent to “freedom”–just like coal companies pitching the public the lie about “clean coal”–you want the suckers to believe that a gold standard will offer them the very opposite of the misery it delivers.

That part of the scam I get. Fair enough. But this 1988 gold standard pitch? Makes no sense.

Over the years, Congressman Ron Paul, hero of the libertarian cult, has hawked his beloved “gold standard” as the cure-all for [NAME OF CURRENT CRISIS], logic be damned. In this video, Dr. Paul promises that the gold standard will solve the trade deficit with Japan, the hot topic in 1988–in fact, Dr. Paul says there won’t even be a trade deficit to worry about if there’s a gold standard, and moreover, people won’t even have to keep accounting records anymore!

Here’s the background to the clip: It’s presidential elections time, 1988, and Dr. Paul is running for president as the Libertarian Party candidate. By this time, American industry has been thoroughly gutted by Reagan, a by-product of his jihad to destroy labor unions. By the end of Reagan’s second term, America was saddled with a frightening trade deficit with Japan, and everyone on the Sunday talk shows harrumphed that Japan–which protects its industry and gives its workers free universal health care–was now getting its revenge on America-san over World War Two.

That’s the background. Since then, China has replaced Japan, but you get the picture.

Now, here’s Dr. Paul explaining to a C-SPAN interviewer his gold-standard Libertarpia, where trade deficits no longer matter,  where you don’t even have to keep accounting records anymore thanks to the gold standard (he seriously says this), and yes, where the rivers flow with chocolate and the children laugh and play in free-market bliss with privatized gumdrop smiles. Here it is [I've pasted a transcript below]:

Anyone who can make sense of what the fuck Dr. Paul is talking about, let me know. Maybe that sign-language gorrilla, Koko, can make sense of it?

UPDATE: Our Australasia correspondent just sent me this British clip on the gold standard that makes roughly the same point about the gold standard–that it’s a bat-shit idea only a tuxedo-wearing right-wing aristocrat could love–only this clip rebuts the libertards better than anything I could write:

Here’s the transcript of Dr. Paul’s gold-standard hustle:

Q: If elected President, how would you handle the trade debt

RON PAUL: Well we wouldn’t worry a whole lot about it. We’d have sound money. And when you have sound money and free trade, you don’t worry about trade deficits. Do you know what the trade deficit is between New York and Texas? Nobody knows it and nobody cares. If we don’t have enough mobney in Texas we have to quit buying. That’s what would happen in the world if we had a sound monetary system, a gold standard where people couldn’t create money out of thin air. The only time tehse trade deficits mean something is when you’re on an inflated paper money system like we are today and then they mean something. So if you have a gold standard, sound money and free markets, you don’t even keep the records. If you spend too much money and you come up short, you gotta go back to work and earn some money before you can buy things from Japan. The fact that we buy a lot of things from Japan–if it were a free market, Japan couldn’t do anything else with those dollars except spend them. They’d either have to loan them back to us or they’d buy something from us. So some of those figures aren’t very meaningful. What we need is afree market, free trade, and sound money. If you had a gold standard–it wouldn’t be so much state fixed rates, but it would be market-wise. The rates would be fixed. Everybody would work on an ounce of gold rather than on dollars and yen.

Q: But even if you go to a gold standard and say, “The United States is now a free trade, open market, anything goes,” how is that going to bring down the walls that Japan has built up against US products?

RON PAUL: It would be irrelevant because it would only hurt the Japanese ten times more than us. The only reason they can do that is because we give them a 50 billion dollar subsidy and they can turn around be more choosy what they do with us. But if they didn’t have that advantage it would be to their disadvantage if they couldn’t buy from us. And again, if they got a lot of dollars from us because we were buying cars, what are they going to do with their dollars? They have to either buy debt from us or invest in our stock market. All the money would have to come back eventually. … The only reason they have such an advantage now is because we give them horrendous tax subsidies through foreign aid and military aid.

Mark Ames is the author of Going Postal: Rage, Murder and Rebellion from Reagan’s Workplaces to Clinton’s Columbine.

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100 Comments

Add your own

  • 1. Valentin  |  March 29th, 2011 at 1:43 pm

    I don’t get how he’s wrong.

  • 2. GhostUnit  |  March 29th, 2011 at 2:09 pm

    offtopic, but can you remove the picture of Glenn Beck on the right side of your site? the one in the “WHAT YOU SHOULD HATE” section.

    I know Glenn Beck’s a despicable idiot but I don’t want to see his fucking face everytime I read something here okay??

  • 3. abc123  |  March 29th, 2011 at 2:31 pm

    And the left loves paper money because it can be centralized and peoples money can be controlled by the state.

  • 4. Josephus P. Franks  |  March 29th, 2011 at 2:36 pm

    I’m actually shocked by how much sense this makes… Not that it is sensible – I’m just shocked it makes any sense. Kind of like if a monkey sat at a keyboard and typed out Atlas Shrugged in its entirety (no, wait, inapposite analogy: Randian drivel is more nonsensical than a random collection of letters and punctuation marks).

    First, Michael Hudson is a much better source of background – on reality, that is, not Paul’s incoherent ramblings. I’d recommend Super Imperialism first (http://michael-hudson.com/books/super-imperialism-the-economic-strategy-of-american-empire/) and then Trade, Development and Foreign Debt (http://branddenotes.blogspot.com/2011/03/unfinished-karl-marx-is-to-blame-for.html).

    Basically Paul’s and others’ love for the gold standard is like those people who are virulently opposed to vaccines. They look at the problems of a modern fiat currency-based monetary system, and assume that things would be better if we adopted the previously-existing system. (Just like vaccine-doubters look at the problems associated with vaccines, and assume things would be better if we did away with them.)

    OK, so you knew that already. As for what Paul said about the balance of payments between the US and Japan, it’s like this. The result of a negative balance of trade with Japan is that Japan’s central bank finds itself holding a bunch of dollars from all of the various banks throughout Japan in which its exporters deposited dollar payments for Japanese exports (or Japanese military contractors got the Pentagon to pay for, again in dollars). What Japan does with those dollars is buy Treasury debt, or stock. (But political pressure keeps Japan, like the Gulf states, from buying anything of strategic importance, and makes any stock purchases very diversified so as to limit foreign control.)

    OK, that’s about all I can do by way of making sense of Paul. He doesn’t seem to realize that this balance of payments setup is quite favorable to the US, because – contrary to what passes for “economics” today – no matter how much Treasury debt Japan or other countries buy, interest rates stay low. That’s because military might doesn’t make its way into theoclassical economists’ little mathematical models. But in the real world, no number of central bankers are going to bully the world’s biggest military bully into paying higher interest rates.

    So the only real-world downside of having a negative balance of trade (for the U.S. only, of course) is only that it tends to mean fewer people are employed here. But this is not a necessary, ineluctable concomitant – it’s just that our ruling class isn’t about to share with us any of the spoils they hoard from a balance of trade that sees the U.S. get way more stuff from the rest of the world than the rest of the world gets from the U.S.

  • 5. Strelnikov  |  March 29th, 2011 at 2:39 pm

    Modern Netspeak translation: Hurr Derp! Derp-Derp Gold Standard Derp! Japan Sux! Derpity-Doo!

    To be serious, Paul is totally confused and is using the gold standard as a panacea against the Japanese 1980s tarriff structure, which kept American imports out and Japanese exports cheap. He somehow thinks that if we reverted to paying in gold there would be no inflation and Japan would be forced to reinvest their export dollars back into the US. He’s confusing monetary policy with trade policy while trying to push for his pet obessesion, so it’s just more election time hot air.

  • 6. Peter  |  March 29th, 2011 at 2:56 pm

    It’s not like the world’s economies were so stable back when there was a gold standard. There were gigantic booms and busts throughout the nineteenth century. And people and companies and countries still got into a lot of debt, presumably because credit is a function of people and not solely a function of metal or the federal reserve or whoever or whatever defines money.

  • 7. Martin Hansen  |  March 29th, 2011 at 3:05 pm

    “As far as I can tell, the reason why the Koch brothers hire tools to promote the gold standard is the same reason that robber barons of the 19th century loved the gold standard so much: Gold locks in the power and wealth of those who have all the power and wealth; and gold locks out everyone else who’s not so lucky, condemning them to serfdom.”

    That doesnt seem right. The gold standard first really ended in 1971, even if the Bretton Woods system was somewhat of a bastard, and there seems to have been a decent bit of social mobility before then.

    “Anyone who can make sense of what the fuck Dr. Paul is talking about, let me know. Maybe that sign-language gorrilla, Koko, can make sense of it?”

    I think Dr. Paul’s point is that if you continue to run a trade deficit under the gold standard you will run out of gold. So people will stop spending more than they earn when the start to run out of money thereby eliminating the problem of a the trade deficit.

  • 8. Fissile  |  March 29th, 2011 at 3:07 pm

    First, a few words about Japan. I can well remember the near hysterical rants about “Japan Inc.” from when I was a kid. “The Japanese bought Rockefeller Center! Japan is destroying the US auto industry! Who really won the war?!” Blah, blah, blah. Looking back, things sure appear very different. The Japanese sent us a lot of high quality goods…I still have an old Sony Trinitron that functions perfectly…and we sent them a lot of IOU’s. The Japanese exchanged a large amount of those IOU’s for American assets that promptly went bust (with the assets reverting to American ownership), so they don’t even the paper paper to show for their hard work. The rest of the paper sits in their bank vaults stinking up the place worse than the all the rotting sashimi in the earthquake zone.

    Which brings me to another point. I’ve been watching a lot of the video coming out of Japan these past couple of weeks, and have noticed that average Japanese doesn’t have a very high standard of living. Yes, the place is clean an orderly, and they have universal health care, but have you noticed the cars and houses? There is no way your average American Walmart shopper could load his fat ass into the type of car that Japanese citizens drive in Japan. Fact is that the Japanese economy has been stagnant for over 20 years now. Just what does the average Japanese have to look forward to? Chained to a cubicle for 12 hours a day. Driving home in a “car” that looks like an American sized microwave with wheels. Going home to his micro apartment and falling asleep in a “sleep cell”, only to repeat the process until he dies…usually at his desk. Despite all this and the earthquakes, and tsunamis and radiation, they don’t riot, or even complain. These poor bastards are a Wall Street sociopath’s wet dream.

    As an encore, we’re trying to do China the way we did Japan, except there are a few added complications. For one, the Chinese have a real nuclear armed military that isn’t controlled by Washington. China may not take the dry reaming as quietly as Japan did.

    Which brings me to gold. Gold standard: Good or Bad?

    There are some real advantages to a gold standard. The great virtue of a gold standard is that it assures long term price stability, although short term price shocks can be severe.

    The greatest disadvantage of a gold standard is that high unemployment rates, over the long term, are the norm under a gold standard.

    We can argue the merits of a gold standard all day, but in the end, it’s a moot point. Fact is that there is a squillion dollars of toxic US debt obligations contaminating central bank vaults all over the globe. How could the US return to a gold standard without stiffing all those debt holders? It can’t be done.

    So why do the Tea-Tards keep harping on a gold standard? My guess is that it’s just a distraction, it’s presented as a simple and easily understood solution to our economic problems. The real solution to our economic problems is actually a bit more messy…we need to introduce bankers and their Wall Street cousins to Madame Guillotine.

  • 9. chav  |  March 29th, 2011 at 3:09 pm

    Whoever the fuck wrote this comment better stick to butt-fucking his cousin Jethro, ´cause he doesn’t know shit about the monetary system. Must be a libertard. Oops, that’s me I’m talking ’bout. Life is tough when you’re a libertard, gee whiz

  • 10. chav  |  March 29th, 2011 at 3:13 pm

    Ron Paul is absolutely correct.
    Yabba dabba doo.

  • 11. Doctor Memory  |  March 29th, 2011 at 4:18 pm

    Fissile: judging japan’s standard of living by the size of their cars and apartments is… well look, I’m not going to pretend that larger living space isn’t nice, and ditto more comfortable transport, but: you could pump ten trillion dollars into the Japanese economy, and it wouldn’t change the fact that they’ve crammed something like 50% of the population of the USA into an area roughly the size of California. (And the plurality of that population lives in ONE CITY.) Even with rampant high-rise construction (in an active earthquake zone, whee!), it’s just gonna be a much, much tighter fit. Apartments will be smaller, cars will be smaller and rarer — it’s just not an apples-to-apples comparison.

    (Also, the whole “Dying at your desk of overwork” thing in Japan is much like school shootings in the US: it happens occasionally and makes a great newspaper story when it does, but you’re statistically more likely to get hit by lightning and a falling meteor on the same day.)

  • 12. Doug  |  March 29th, 2011 at 4:34 pm

    “The greatest disadvantage of a gold standard is that high unemployment rates, over the long term, are the norm under a gold standard.”

    What?! The 19th century had average rates of employment that are barely matched at all in post-war America. There were short periods of giant busts when unemployment quickly spiked, but it also quickly subsided. Hence the average rate stood very low. In contrast the post-Fed era (1914 onwards) is known for periods of prolonged painful recession and unemployment (the Great Depression, the post-WWII returning GI unemployment crisis, the oil crisis of the 1970s, the recessions of the early 80s, the current credit crisis, etc.).

    The argument for gold specifically and austerity in general isn’t that it prevents the boom/bust cycle. That’s inevitable, as technology advances and society changes investors will continually speculate about the next big thing. Frequently those investors will be wrong, sometimes spectacularly. But if everyone was too afraid to take any risks, we’d be discussing this issue over the village corn mill.

    The advantage of gold specifically and austerity in general is that the painful readjustment allows the economy to reconfigure quickly to a more optimal pattern of production. (“Okay it turns out Pets.com isn’t worth $5bn, us web developers need to go get new jobs.”) Inflationary central bank monetary policy counteracts this process by keeping bubbles inflated with an acceleratingly increasing supply of money.

    Thus while it depressed the spike of unemployment that accompanies bubble busts, it also prolongs it by keeping the economy in a sub-optimal pattern of production.

  • 13. chav  |  March 29th, 2011 at 4:39 pm

    Ron Paul is absolutely correct. Sound money above all.

  • 14. liberals  |  March 29th, 2011 at 4:40 pm

    Yes, having a currency that has no more intrinsic worth than the wool, paper, and ink it’s created with makes perfect sense! Especially when collectivist bankers can just flip bits in a computer and create trillions of them out of nothing but electrons! And then hand them to their collectivist buddies at Goldman Sachs! Thanks Exiled, you’ve opened my eyes at last.

    Because as we all know, gold has a lot of intrinsic value. I mean, it’s shiny! How intrinsic is that! Sure, you can’t make anything with gold, but monkeys sure are awed by its shininess, and if that isn’t “intrinsic” then my name isn’t “libertard von troller”

  • 15. chav  |  March 29th, 2011 at 4:42 pm

    BTW my hairy ass doesn’t know shit about the monetary system or how money is created. Better post these articles.

  • 16. chav  |  March 29th, 2011 at 4:47 pm

    The tea party like any “mania” is based on a sound principle (sound money via the gold standard vs. fiat money), the problem is that as any mania or reckless cult, a sound principle is then perverted to the extreme. That is, the foundation is good (otherwise no one would join in), but then it’s perverted.

  • 17. chav  |  March 29th, 2011 at 4:57 pm

    Make sure you read comments 9,10 & 15. And please, someone pull me out of my mother’s basement and flog me for good measure.

  • 18. Fissile  |  March 29th, 2011 at 5:11 pm

    @Doug,

    How do you propose to re-establish a gold standard with the 5 trillion dollars(give or take a half trillion) in US debt held by foreigners?

  • 19. liberals  |  March 29th, 2011 at 5:17 pm

    Yes, nothing has “intrinsic” worth if you take away the monkeys. Rocks – still inert! Viruses – still don’t barter! Congrats Exiled on another fucking economic newsflash.

  • 20. rita  |  March 29th, 2011 at 5:19 pm

    I want platinium standard with palladium edges.

  • 21. zeev  |  March 29th, 2011 at 6:30 pm

    this is all about trade deficits.

    ” if we don’t have enough money in texas we quit buying ” this is what it’s about. if the u.s STOP printing money , if the treasury is prohibited from raising the debt cieling (whether by gold standard , by copper standard, or by congress voting against printing more money—it makes no difference )

    then we will soon have to stop buying things from the rest of the world. thing from abroad will become MUCH MORE EXPENSIVE. especially OIL. this will result in a huge contraction in the american economy. the cost of inputs will rise, the cost of everything else will rise, the cost of labor will rise, in short, we become europeanized. right now we are living high on the hog like britain did 80 years ago. we are getting off the hog soon. you know who gets on the hog? the bric. brazil russian india china. you know who has the biggest reserves of currency? china.

  • 22. zeev  |  March 29th, 2011 at 6:30 pm

    this is all about trade deficits.

    ” if we don’t have enough money in texas we quit buying ” this is what it’s about. if the u.s STOP printing money , if the treasury is prohibited from raising the debt cieling (whether by gold standard , by copper standard, or by congress voting against printing more money—it makes no difference )

    then we will soon have to stop buying things from the rest of the world. thing from abroad will become MUCH MORE EXPENSIVE. especially OIL. this will result in a huge contraction in the american economy. the cost of inputs will rise, the cost of everything else will rise, the cost of labor will rise, in short, we become europeanized. right now we are living high on the hog like britain did 80 years ago. we are getting off the hog soon. you know who gets on the hog? the bric. brazil russian india china. you know who has the biggest reserves of currency? china.

  • 23. Doug  |  March 29th, 2011 at 7:28 pm

    @Fissile

    Well presumably the government has enough future potential tax streams to cover it’s future liabilities, or at least so Treasury claims. The only difference is that the government in the future will be collecting these tax streams in gold instead of dollars. Similarly it will have to convert its liabilities from dollars to gold as well.

    The good part is since the dollar isn’t currently tied to gold the US government can announce whatever conversion ratio they want (as long as its reasonably supported by existing gold reserves). There’s no reason to convert at 1933 levels or even current market prices (both of which would be impossible anyway given the current size of reserves).

    The government would simply determine the conversion ratio at which its debt and future liabilities could reasonably be handled given its gold reserves and the expected value of future taxes.

    In fact you can even enhance this a little bit by simply announcing a one-time capital gains tax on all American entities holding gold, since they stand to reap giant profits post-conversion. However even if you tax them at 90% they still stand to make a fortune since basic calculations on say that if gold was re-monetized it would have to be remonetized at somewhere around $35,000/oz (current market prices are about $1350/oz). So the speculators would still be de seeing 100+% returns on their profits and be very happy with this.

    In turn this gives the government a gigantic one-time revenue boost that it could either use to completely pay down the debt, set conversion at a lower level (thus benefitting dollar holders more), or spend as part of a giant stimulus to help reboot the economy from any jitters this plan might cause. Probably some combination of all three.

    @liberals

    Don’t be puerile and attack straw-man arguments. The reason gold is valuable has nothing to do with its shininess. The point of money is to act as a store of value. The easier something can be made the worse store of value it is (since it goes up in value, manufacturers can always produce more at cost and push the value back down).

    Gold is pretty fucking hard to make any more of. There’s only a (tiny) fixed amount in the ground, and it’s damn hard to get out. There’s currently about 1000 years of gold production in reserves, (compared to about <1-3 years for most industrial commodities), so the value of held gold isn't in danger of being debased.

    Fiat money however can be expanded arbitrarily at the will of the central bank. So its value is entirely dependent on investors confidence in the central bank's reputation. If it blows it then the situation looks like Zimbabwe or Weimar Germany. So gold's safety as a reserve of a value is derived from the laws of geology and physics. The dollar's safety as a reserve of value is reliant upon the trustworthiness of the US government.

    See the reason investors hold gold (especially as an emergency safety asset?)

  • 24. vortexgods  |  March 29th, 2011 at 7:50 pm

    http://historymatters.gmu.edu/d/5354/

    Ironically, one of the original reasons why Poor, Mad Bryan hated Darwin, was because he hated Social Darwinism. Not sure what he’d make of the modern world.

    “If they dare to come out in the open field and defend the gold standard as a good thing, we shall fight them to the uttermost, having behind us the producing masses of the nation and the world. Having behind us the commercial interests and the laboring interests and all the toiling masses, we shall answer their demands for a gold standard by saying to them, you shall not press down upon the brow of labor this crown of thorns. You shall not crucify mankind upon a cross of gold.”

  • 25. vortexgods  |  March 29th, 2011 at 8:07 pm

    Oh and from the same speech:

    “Mr. Carlisle said in 1878 that this was a struggle between the idle holders of idle capital and the struggling masses who produce the wealth and pay the taxes of the country; and my friends, it is simply a question that we shall decide upon which side shall the Democratic Party fight. Upon the side of the idle holders of idle capital, or upon the side of the struggling masses? That is the question that the party must answer first; and then it must be answered by each individual hereafter. The sympathies of the Democratic Party, as described by the platform, are on the side of the struggling masses, who have ever been the foundation of the Democratic Party.”

    Hmm, the idle holders of idle capital versus the struggling masses, and the holders of idle capital love the gold standard. What does this remind me of a society divided into “idle holders of idle capital” and “struggling masses?” And why does it not surprise me that libertarians favor the gold standard?

  • 26. King Mob  |  March 29th, 2011 at 8:08 pm

    I like you Ames, but Ron Paul is far closer to being correct about economics than you are. -Libertard

  • 27. Soj  |  March 29th, 2011 at 8:18 pm

    I can’t “translate” what Ron Paul is saying exactly but here’s the two line shortcut:

    Fiat money (printed at will) = unlimited supply
    Gold money (based on actual physical material) = finite supply

    Therefore they extrapolate a number of things to say “if the money supply were finite then X, Y and Z would occur”.

    What X, Y and Z are is the debate.

  • 28. Fissile  |  March 29th, 2011 at 8:25 pm

    @Doug, Post #23

    Re-monetizing gold can wipe out the national debt?!!! There are no price fluctions under a gold standard?!!! Your post is just so full of economics 101 FAIL I don’t know where to begin. Your post also proves what I suspected, you’re a gold bug crank.

    I have no intention wasting my time by picking apart your “argument” point by point, because arguing with a gold crank is like arguing with a 9-11 Truther or an Obama Birther….facts and logic have no effect on a true believer.

    Fact: The only way the world will see gold re-monetized is if the entire planet undergoes an economic catastrophe of biblical proportions. No one wants to see that happen, not the USA, not the Chinese, not even the Iranians.

  • 29. the guy on the oatmeal box  |  March 29th, 2011 at 8:51 pm

    I’m no economist but to me it seems sensible to base our money on SOMETHING tangible and finite if for nothing else than to limit manipulation and inflation.

  • 30. Fissile  |  March 29th, 2011 at 9:03 pm

    @the guy on the oatmeal box

    The US dollar IS backed by a commodity….at least in part….a commodity that is infinitely more practical to the world’s industrial economy than is gold. You wanna take intrinsic value? How about oil?

    http://www.trinicenter.com/oops/iraqeuro.html

  • 31. Septeus7  |  March 29th, 2011 at 9:46 pm

    A gold standard is the complete privatization of the government. If the Government can’t be the sovereign creator of it’s own currency then it will have to borrow the gold material from creditors who will essentially own the government because without money the Government can’t do anything.

    A gold standard means no republic for a private cartel controlling on the public money supply (the money used to pay taxes) by definition means everyone becomes a serf of the folks who own the gold.

    It’s Golden rule; he who owns the golds makes the rules. Who owns the Golds ? The Garchs and Pluts!

    The solution to both fiat and the gold standard was found the World Savior Jesus Christ when he suggested that we should “render unto Ceasar that which is Ceasar’s” meaning give the Government’s fiat back to the government for public debt and let the private sector deal with private debt. But what does a deity know? We have Ron Paul.

    Here’s an idea on how the future will look whether because digital currency will not be stopped.

    http://www.digitalcoin.info/

  • 32. joe  |  March 29th, 2011 at 9:49 pm

    People need to stop arguing about what backs a monetary system. How well an economy functions is based on how quickly money moves around. One way to encourage money to move around is to create more of it. This can be done with debt instruments like fractional reserve banking or selling bonds. Problem is debt has to eventually get paid off leading to bubbles and confidence crisises. The other way is to simply print more of it. This is fiscally equivalent to taxing the value of money. Another way to encourage money to move around is force taxes on people and spend it on workfare or welfare programs.

    The reason libertarians like the gold system is because it removes government control of a monetary system and libertarians think the free market will cure all that ails you including herpies.

    the whole concept of intrinsic worth is an oxymoron since worth is a human invention to begin with. Gold is valuable due to the Tinkerbell effect just as fiat currency is. Warren buffet once said:

    “It gets dug out of the ground in Africa, or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head.”
    – Warren Buffett

    But what the fuck would he know he’s just the richest man in the world. He obviously knows nothing about monetary policy

  • 33. joe  |  March 29th, 2011 at 10:02 pm

    I think the main reason the rich like the idea of the gold standard is because it removes the power of government to cause inflation. Which like I said in my last post inflation is essentially a tax on the value of money. The poor don’t care to much about inflation since they are living hand to mouth and are more concerned with the price of labor in relation to the cost of living. In a lazze fair economy the only check on the price of labor is due to the point where people have a choice between starvation and a bread riot.

  • 34. vortexgods  |  March 29th, 2011 at 10:08 pm

    Actually, you can make really great electrical wire with gold. It would be far more valuable used like that then dug up from one hole and then taken and put in another hole. It has very low electrical resistance and therefore is very energy efficient.

    Energy is what people care about in the modern world, not pretty rocks.

  • 35. Hannibal  |  March 29th, 2011 at 10:25 pm

    I agree with Strelnikov; Ron Paul is a panocha.

    I like how libertarians think that all the problems of the world will be solved and all types of head-aches will be averted if we just adopt their silly little theories.

    Trade deficits? Well, you gotta adopt the gold standard, see? And then the problem takes care of itself, y’see?!?!

    Sanitation? Leave it to the free market, ya see and watch the trash pick itself up, y’see!!!

    Drugs? Let people make choices y’see, and when they fuck their own life up and end up in jail, we’ll get rid of an unproductive leech and there’ll be more money for the rest of us, see?!?!

    Education? Let everybody bear the cost of their own education, y’see, and then the stupid retarded fuck-up dunces will end up dead or in jail, and the really successful, decent, intelligent lads will end up running the country, y’see?!?!

    Free markets! sink or swim! every man for hisself! Y’SEE!?!?

  • 36. Doug  |  March 29th, 2011 at 10:47 pm

    @Fissile #28

    I have a degree in finance from Wharton. I work as an analyst at a multi-billion dollar hedge fund. I’ve worked under some of the most respected global macro managers in the world. Everyday my trading strategies move several hundred million dollars.

    What exactly are your credentials for understanding basic economics?

    Also please explain if gold is such a ludicrous investment why don’t you put your money where your mouth is and short the fuck out of it?

    Because your sentiments strongly disagree with some of the most successful investors in the history of the world: John Paulson, George Soros, David Einhorn, Paul Tudor Jones.

    Exactly how much assets under management does the great Fissile Capital Partners have? Oh yeah, jack shit.

  • 37. CensusLouie  |  March 29th, 2011 at 11:12 pm

    They very, very simple, basic explanation for Libertarian love of gold can be boiled down to “it’s shiny, and I can see it.”

    Libertarians can hugely vary on personal quirks, there’s the sex & drugs hippie libertarian, the free market plutocrat libertarian, and the civil rights hating racist libertarian.

    But the one factor they all have in common is that they HATE anything they cannot immediately understand and want to tear it down. This is the only mindset that can possibly believe we would be better off with NO government. They’re the primitive brains who can’t comprehend anything beyond the old tribal level of human governance. Modern civilization is a big scary thing that hurts their heads so they want it SMASHED!

    So they love the idea of a gold standard because gold was the most basic, primitive measure of wealth. If currency isn’t based on a shiny physical thing that they can see, then it’s too much to comprehend for their hurting brains and the “SMASH!” reflex is triggered.

  • 38. zappa is not dead  |  March 29th, 2011 at 11:23 pm

    Free your mind, then ponder the yellow snow

    http://www.lewrockwell.com/north/north962.html

  • 39. my talkative ringpiece  |  March 30th, 2011 at 12:18 am

    Fissile- Japan in the 80s kicked ass. Manga was still for the national, not international, market, people still remembered the “honey wagon” and wooden geta and worked hard, their products kicked ass. I could go on and on about 1980s Japanese motorcycles, for instance. The GPz’s! The KLX’s and XL’s/XR’s and the UJM, Universal Japanese Motorcycle, an inline-4 (regardless of Honda’s excellent V-fours and Suzuki’s square-4, a 2-stroke no less) air-cooled, low-tech enough to do your own wrenching, high-tech, and hi-powered, enough to be a complete total fucking blast, racing with your buddies at 90+ through a rolling gridlock of 70MPH Southern California traffic. A working class asshole could afford them. Fucking great times. Sony ruled. If it was Sony, buy it, you couldn’t go wrong.

    Then, 1989. Recession, depression, stagnation, housing scams and homeless, in Japan!

    Japan in the 80s fucking rocked.

  • 40. my talkative ringpiece  |  March 30th, 2011 at 12:28 am

    Doug – The trouble with unemployment post WWI is, they started measuring it. And, measuring it became necessary. Before, you had a lot of dudes like me.

    Yes, with a nod in Fissile’s direction, before I lost it all I had a Prius, great car, holds 4 Japanese and their luggage, or 2 fatass Americans and a little bit of luggage, look at the GVWR specs on the thing.

    Now, I don’t show up on unemployment rolls, having been self-employed. (I also don’t show up on Welfare or Food Stamp rolls either since I’m the kind of asshole who wants to stay far away from gov’t if given my druthers.) I actually have work. Do I make huge, bloated capitalist-running-dog pay like say, US minimum wage? Nooo, that would be nice but, how do I put this? I quit. I make a few hundred in a good month. I take odd jobs, buy/sell stuff, do all kinds of odd, interstitial work, and I’m free to turn down work I don’t like. I’m the USFedGov’s worst nightmare. I don’t need ‘em. Today I agreed to sell 6 chickens, got some customers for eggs, and got work ….. for my neighbor. All verbal, face to face, nuttin’ written down. We American *can* learn to live and deal like countryside Afghanis, once we lose it all. There is hope.

    As for Paul …. I dunno. It’s probably a good idea to have a little gold or silver stashed away, but it’s even better to know how to live even if you don’t have any glittery stuff.

  • 41. Eddie  |  March 30th, 2011 at 12:44 am

    Is it just me or do more people think that Dr. Paul is part of an Falange of the republican party that is preparing for a day when the Empire is no more. Then they can point to the good doctor and say. Look at that guy, he saw it coming and he has the answers as well.

    Of course the answer is nonsensical like everything else coming from the republican party. It’s just a scam to preserve the wealth of the very rich and at the same time regress further into the 19th and 18th century.

    My bet would be that if ever the shit hits the fan, each and every republican out there would speak about Paul the way they do Reagan now.

  • 42. unger  |  March 30th, 2011 at 2:18 am

    Might I suggest googling ‘gold outflow’? Do it and what he’s saying will make a hell of a lot more sense. Not only is it not ‘econ 101 fail’, but it’s pretty straightforward economic history. Even if you oppose a hard money standard for its obvious policy limitations, it’s simple ignorance to deny that where the pre-Bretton Woods gold standard was allowed to work, trade deficits were accounting errors. I cannot think of a single economics textbook, mainstream or otherwise, that both covers this field of economic history and fails to explain how gold outflows and inflows were used to balance international trade.

    CensusLouie: If ‘modern civilization’ means massive faceless bureaucracies controlled by elites, as all bureaucracies without exception always have been and always must be, then yes, libertarians – well, at least the ones who *don’t* drink the Koch-aid, which, despite everyone’s efforts to get them into the Matrix, is still pretty close to half of ‘em – want to smash it. You have a problem with this …why?

  • 43. Fissile  |  March 30th, 2011 at 6:31 am

    @Doug #36

    Wharton huh? I can’t match that kind of cred. Nope. I’m just a loser that’s been sitting on the sidelines watching Biz school grads putting together ever bigger swindles…….CDO’s full of subprime that was peddled to every private and public retirement fund, because real estate can never go down….just one example. Of course when your swindles and Ponzi schemes implode, you demand gov bailouts because you’re “to big to fail”. Ultimately that money comes from losers like me…hey, I can live on just one meal a day, no problem. And then you all are entitled to bonuses for all your hard “work”, and God forbid that a non-MBA such as myself suggests that the gov raise you income taxes by 1% because that’s socialism. Why should you support leeches like me? Besides, it’s all about the trickle down. Yup, it’s great to be a Wharton MBA, it’s a lifetime full of private profits, and public loses. Heads, I win, tails you lose. Suckers.

    And now, for an encore, you all want to reestablish the gold standard. The gold standard will miraculously wipe out the $15 trillion dollar national debt. Of course you’re kind of sketchy as to where the production will come from to wipe out that debt, since debt is a claim on future income(production). Somewhere someone will have to get stiffed, either the debt holders or losers like me. Somehow I’m guessing that it’s not gonna be the holders of that debt.

    Like the old saying goes, the devil is in the details. Old Nick told me that himself, he’s also the board of directors of the Wharton School.

  • 44. sam  |  March 30th, 2011 at 8:09 am

    The funny thing about all these people who love the golden shower is that they say “you couldn’t just create money out of nothing under the gold standard.”

    Not true.

    You can create money out of nothing under the gold standard. It would just mean that your money would be worth less gold. Tards.

  • 45. Onarag Dickshit  |  March 30th, 2011 at 8:50 am

    Strong gold: it sure as heck saved us in the 1920s, derp derp!

    Gold standard proponents should be force-fed the recent award-winning book “Lords of Finance” to learn how ineffective in practice the gold standard is.

  • 46. joe  |  March 30th, 2011 at 9:13 am

    @ vortexgods

    silver and copper have lower electrical resistance. The advantage of using gold for electronics is it does not tarnish making it good for electrical contacts. This is why the cyclotrons used for uranium enrichment used silver wiring.

  • 47. go heavy go hydralic  |  March 30th, 2011 at 9:29 am

    RIP another free man

    December 08, 2009
    The Devil and Mr. Obama
    Barack promised change — and sure enough, things changed for the worse
    (Note: Patrick Ward, associate editor of the UK’s Socialist Review asked Joe to write a piece for the party publication. This is the unabridged text of Joe’s submission.)
    By Joe Bageant
    Well lookee here! An invite from my limey comrades to recap Barack Obama’s first year in office. Well comrades, I can do this thing two ways. I can simply state that the great mocha hope turned out to be a Trojan horse for Wall Street and the Pentagon. Or I can lay in an all-night stock of tequila, limes and reefer and puke up the entire miserable tale like some 5,000 word tequila purged Congolese stomach worm. I have chosen to do the latter.
    As you may know, Obama’s public approval ratings are taking a beating. Millions of his former cult members have awakened with a splitting hangover to find their pockets turned inside out and eviction notices on the doors of their 4,000 square foot subprime mortgaged cardboard fuck boxes. Many who voted for Obama out of disgust for the Bush regime are now listening to the Republicans again on their car radios as they drive around looking for a suitable place to hide their vehicles from the repo man. Don’t construe this as support for the GOP. It’s just the standard ping ponging of disappointment and disgust that comes after the honeymoon is over with any administration. Most Americans’ party affiliations are the same as they were when Bush was elected. After all, Obama did not get elected on a landslide by any means; he got 51% of the vote.

    Right now his approval ratings are in the 40th percentile and would be headed for the basement of the league were it not for the residual effect of the Kool-Aid love fest a year ago. However, millions of American liberals remain faithful, and believe Obama will arise from the dead in the third year and ascend to glory. You will find them at Huffington Post.
    This frustrating ping pong game in which the margin of first time, disenchanted and undecided voters are batted back and forth has become the whole of American elections. That makes both the Republican and Democratic parties very happy, since it keeps the game down to fighting the enemy they know, each other, as opposed to being forced to deal with the real issues, or worse yet, an independent or third party candidate who might have a solution or two.
    Thus, the game is limited to two players between two corporate parties. One is the Republican Party, which believes we should hand over our lives and resources directly to the local Chamber of Commerce, so the chamber can deliver them to the big corporations. The other, the Democratic Party, believes we should hand our lives and resources to a Democratic administration — so it alone can deliver our asses to the big dogs who own the country. In the big picture it’s always about who gets to deliver the money to the Wall Street hyena pack.
    Americans may be starting to get the big picture about politics, money and corporate power. But I doubt it. Given that most still believe the war on terrorism is real, and that terrorists always just happen to be found near gas and oil deposits, there is plenty of room left to blow more smoke up their asses. Especially considering how we are conditioned to go into blind fits of patriotism at the sight of the flag, an eagle, or the mention of “our heroes,” even if the heroes happen to be killing and maiming Muslim babies at the moment. Patriotism is a cataract that blinds us to all national discrepancies.
    Much of the rest of the world seems plagued with similar cataracts that keep it from noticing the chasm of discrepancy between what Obama says and what he actually does. The Nobel Committee awarded the 2009 Peace Prize to the very person who dropped the most bombs and killed the most poor people on the planet during that year. The same guy who started a new war in Pakistan, beefed up the ongoing war in Afghanistan, and continues to threaten Iran with attack unless Iran cops to phony US-Israeli charges of secret nuclear weapons facilities. It’s weapons of mass destruction all over again. Somewhere in the whole fracas has been forgotten that Iran has been calling for a nuclear free zone in the Middle East since 1974. Iran has also been consistent in its position that “petroleum is a noble material, much too valuable to burn for electricity,” and that nuclear energy makes much more sense, given that our food supply, whether we like it or not, is fundamentally dependent upon petrochemicals and will remain so until the earth’s population is reduced to at least half of what it is now. The Iranian attitude has been to use the shrinking petroleum deposits as judiciously as possible.
    To which oilman George Bush replied that “There will be consequences for Iran’s attitude.” Obama has reinforced Bush’s sentiment, stating that not only will there be consequences, but that a military strike on Iran “is not out of the question.” Although nuclear weapons are in direct opposition to the Muslim faith, 71 million Iranians must have shuddered and paused to think: “Maybe an Iranian bomb isn’t such a bad idea after all.”
    Under cover of being the first “black” president, Obama is looking to best one of the Bush administration’s records. And that is causing unshirted hell for anybody two shades darker than a paper bag, particularly if they are wearing sandals (Obama himself being only one shade darker than the bag and given to size eleven black Cole Haans). So far, two million Pakistanis have been, in official US State Department jargon, “displaced” by U.S. backed bombing and gunfire — which will surely displace a fellow if anything will. A significant portion of them are “living with host families.” Translation: packed into crowded houses ten to a room, wiping out food and water supplies, crashing already fragile sanitation infrastructure, and serving as a giant human Petrie dish for intestinal and respiratory diseases. Many more are still living in the “conflict area.” Makes it sound like living next door to a neighborhood domestic squabble, doesn’t it? God only knows how many more innocent people will yet be killed in the conflict area of Obama’s “war of necessity.” You know, the “good war.” The war that is supposed to offset the interminable bad one in Iraq, where we continue to occupy and build more bases.
    Afghanistan: Grab the opium and run
    Then there are Obama’s noble efforts to fight terrorism by beefing up troop “deployment” in Afghanistan. Deployment may be construed to mean an American style armed gangbang, in which everybody piles on some wretched flea bitten hamlets for all they are worth, with periodic breaks for pizza and video games.
    Now if you look at the deployment of US forces in Afghanistan, compared to NATO country forces there, you’ll find them in a nice even line along what could easily be mistaken for an oil pipeline route. One that taps into the natural gas deposits in Uzbekistan and Turkmenistan and, by the purest coincidence, just happens to bypass nearby Russia and Iran. But we all know that “It’s about fighting terrorism over there so we won’t have to fight it here!” That still plays in Peoria, so we’re sticking with it.
    At the moment, out-of-pocket cost of America’s wars in Iraq and Afghanistan is $900 billion. Interest on the debt incurred, plus the waste of productive resources on the war, pushes the cost to three thousand billion dollars (Nobel economist Joseph Stiglitz). By comparison, the entire 2009 government budget for elementary and secondary education is slightly above $800 billion. Or to look at it another way, how far would three thousand billion dollars go toward establishing energy independence? As Harvard monetary expert Linda Bilmes points out that there is “no benefit whatsoever for any American whose income does not derive from the military/security complex.” I sent an email to Obama pointing this out, suggesting that we pull out of Afghanistan, grab the opium and run. I got a nice reply saying that my president is grateful for the input. So there ya go.
    Lately there has been a ruckus about our little “slap shop” in Guantanamo Bay, Cuba. Despite Obama’s promises to close down, “Cigarland,” it is still open for business. Word has it that Cigarland may be moved to an “underused” maximum security prison (one would think a scarcity of criminals for a maximum security prison would be good news, but what do I know?) in the desperately broke community of Thompson, Illinois. Locals there tell the national press, “Sure, put it in our backyard. No problem.” Or, “This town is in the prison business. Prisons R Us.” Or more bluntly, “We know how to handle these creeps and we need the jobs.”
    It’s the kind of job creation Stalin would have understood.
    Happiness is a warm tent
    But at least the recession is over. This, according to Obama’s monetary point man, Ben Bernanke, chairman of the Federal Reserve Bank. For British readers unfamiliar with the US system, the Federal Reserve is not a government agency, despite its agency like name. “The Fed” is an offshore private banking cartel that decides just how much bogus currency can be printed and circulated profitably for bankers without wrecking their Ponzi schemes. And the chairman of that august body has announced that the recession is over. Well halleluja! We can quit rolling our own cigs and buy ready mades, and run recklessly through the Dollar Store scooping up dented canned goods and cheap Chinese tube socks.
    That makes us luckier than the three and a half million Americans, most of whom led normal lives a few of years ago, who are now homeless. That includes one million school children sleeping in tents, shelters and other makeshift arrangements, and trying to look presentable each morning at schools that have not even the mercy to let them use the school showers. By the administration’s own calculation, the number of homeless and people out of work will continue to escalate at least into the next year. Home foreclosures, and therefore homelessness, “has not topped out yet,” says Obama.
    But Bernanke has announced that the recession is over. So there you have it. A grateful nation breathes a sigh of relief. And besides, he is right about it being over. The recession is over for the most important members of a capitalist society, the oligarchs and banksters, who have made fortunes off this recession, thanks to our unique economic system, and may now return to their standard garden variety usury.
    Economic systems are merely belief systems. I didn’t say that. Keynes said that. For instance, if the early Assyrians believed a shekel was worth a jar of wheat, then it was worth a jar of wheat. American style capitalism eventually stretched belief to the absolute limits of fantasy to the snapping point, as regards general credulity. Nobody abroad still believes the dollar is worth folding up and sticking in a wallet, certainly not worth exchanging for a good old fashioned shekel. However, be it shekels or dollars or euros, there is no economic system at all if there is no production. And there is no production if there are no jobs. Hence the obsession with unemployment rates.
    The U.S. Ministry of Truth has announced that our unemployment rate is at 10%. I’ve yet to meet an American who does not know the official unemployment rate is a complete fiction. One half of the unemployed — the half that has been unemployed for more than one year — are simply erased from the official count. Poof! The real rate is somewhere around 20%. But if we acknowledged that, we’d have to admit to being on par with Europe’s unemployment rate. And by diddle damned we can never do that. Every American fully understands that the purpose of life is to hang onto one meaningless job or another, two of them if possible. And by the state’s official numbers more Americans have a white knuckled grip on life’s purpose than any of those pussy socialist European nations with their free healthcare, low infant mortality rates and ridiculously long vacations.
    But the bad news, which the Obama administration openly acknowledges, is this: Unemployment will in all likelihood go higher. And nobody on earth knows how to reduce it (although no one in the administration is about to acknowledge that). The factories are all but gone and they are not coming back. Not unless American workers are willing to work 13 hours a day for two Chinese yuan an hour, which is about 31 cents. What US factories remain are laying workers off due to high interest rates, and waiting for a lower interest rate policy before deciding if it is feasible to call any workers back into production.
    During their wait they can watch hell freeze over. Banks know a fatter hog when they see it. And that hog is the consumer credit business (nobody has figured out yet that consumers need paychecks before they can consume anything, on credit or otherwise ). To that end the Federal Reserve has logically set a low interest rate policy. And in true accordance with banking logic, the banks took the Fed’s money, then raised the annual percentage rate (APR) on credit card purchases and cash advances and on balances that have a penalty rate because of late payment. Next they raised the late fee. What the hell? If Americans are on the ropes, struggling to make their payments on time, then the logical thing to do is to stick it to them. Bleed ‘em for all they’re worth. It’s an American free market tradition. We the people do not complain. We expect no mercy. America is a business and the American concept of business is pure ruthlessness.
    A Deutsche Bank analyst tells me a near term worst is yet to come. Bank failures and home foreclosures have not peaked. A commercial real estate bust is coming down the pike. He says that, while there will be some minor periodic upswings, the fraudulent value of the dollar is now evident as it falls against every other currency, even the Russian ruble (13%), except those unlucky enough to be pegged to the US dollar. As former Assistant Secretary of Treasury Paul Craig Roberts says: “What sort of recovery is it when the safest investment an American can make is to bet against the US dollar?” My Deutsche Bank friend, who is younger and has a family to think about, has taken what he considers more appropriate action. He’s buying gold and moving to an undeveloped Central American country.
    But Mr. Bernanke assures us that the worst is indeed over. Despite the outside world’s serious doubts, but Bernanke’s announcement just might fly in the U.S. We believe whatever our Ministry of Truth tells us. We believed that debt was wealth, didn’t we? And we believed in WMDs, and have come to believe warfare is a prerequisite to peace.
    The saddest thing is that Americans are cultivated like mushrooms from birth to death, kept in the dark and fed horseshit. Consequently, they haven’t the slightest idea that there is an alternative to the system in which they labor at the pleasure of corporate and financial elites who own both their government and their every waking hour. That alternative is democratic Socialism. Self governance for the broadest common good. Which the Ministry of Truth has defined for them as fascism.
    Healthcare and environment? Ha-ha-ha-ha-ha-ha-ha-ha-ha-ha-ha-ha
    I would guess that you have heard about the “debate” over “healthcare reform in America.” There really wasn’t much debate, just a lot of thuggish behavior and wild tales of geriatric death panels by the right, and groveling capitulation on the left. The “reform” turned out to be a $70 billion a year giveaway to the insurance companies, by forcing those 45 million folks who cannot afford insurance at all to buy it anyway. Taxpayer dollars will make up the difference between what can be wrung out of the working poor, and what insurance corporations can demand and get because they have a throat lock on both of the other parties involved — the doctors and the patients. As for the doctors, they have played it so cool butter wouldn’t melt in theor mouths, and successfully avoided the question of whether their quarter million dollar and up incomes just might be contributing to the exorbitant cost of healthcare. Even with a majority in Congress, the best Obama and the Democratic Party’s corporate lapdogs could come up with was total handover to the insurance industry. If this smells a bit suspicious, it is the sweat of cold fear you are smelling. The insurance companies have always made it clear they have billions to spend in defeating and destroying any elected official not on their side.
    As for environmental legislation, under the Obama administration environmentalism is pretty much reduced to “cap and trade.” In the truest spirit of capitalism, corporations will be able to sell their pollution for a profit, instead of ending it. And even this legislation barely made it through the House of Representatives. Moreover, environmental legislation has had the snot knocked out of it by the economic crash, and opinion polls now show the American public believes the price is too dear. It should be interesting to see what price their children will be willing to pay for oxygen and water.
    Goldstone who?
    Just when you think your country has reached the limits of raw shame and the outer banks of rogue internationalism occupied by Korea’s Kim Jong-Il and Sudan’s Omar al-Bashir, it surprises you with some new and worse outrage. America’s latest is right up there with holocaust denial in sheer unmitigated abrasive gall — putting the kibosh on the UN’s Goldstone Report. The report documents Israeli war crimes in the Gaza Ghetto, where 1.5 million Palestinians have been held miserable hostages by Israel. Admittedly, leadership both in Gaza and Israel is nothing short of a pack of criminals. But the Israeli attack on civilians and civilian infrastructure such as hospitals and schools, using illegal munitions such as skin melting white phosphorus, was a war crime by every definition. The UN and the world agree that it meets and exceeds the Nuremberg standard that the US established in order to execute Nazis. But as any American will tell you, the United States has never considered itself part of the rest of the world or in any way obliged to join. So the rest of the world was not surprised when the US House of Representatives voted 344 to 36 to condemn the Goldstone Report. The Obama administration has promised Zionist groups that it will never let the report get to the criminal court. The perps are safe. Zionists everywhere threw their hats in the air and cheered. The AIPAC boys at the back of the room nodded in approval: “Now tell us Congressmen, who’s yer daddy?”
    I might add at this point that I am not one of those conspiracy freaks who see Zionist plots behind everything. The Zionists are but one of many backstage operators with a death grip on some aspect of U.S. policy. Frankly, of all the greaseballs and thugs muscling US domestic and international policy, I fear the Wall Street and the bankers far more than I fear any Zionist (except maybe that spooky shapeshifting motherfucker, Rahm Emanuel. Brrrr!).
    In any case, most Americans have never heard of the attack on Gaza or the Goldstone Report. They were prevented from hearing the outside world’s news coverage of the grisly two week long specter. Residing in a free Central American country at the time, I was fortunate (or unfortunate) enough to hear the daily dispatches from inside Gaza, despite Israeli efforts to suppress them. About the only place the Zionist misinformation machinery really worked was in the United States, where it successfully repressed media coverage of Israeli atrocities and genocide. Not that it required great effort. American politicians and media long ago learned, as a client state of Zion, to look the other way. Or if that is not possible, to support one of the prepackaged lies conveniently provided the U.S. media by the Likudnik media management apparatus. “And besides, weren’t the Palestinians the fuckers who danced in the streets after 9/11? Screw ‘em! We now return to Cable News coverage of last night’s America’s Got Talent winners, the ZOOperstars!”
    The man with the plan
    The same day the assault on Gaza began, January 4, 2009, president elect Obama announced he would create or save three or four million jobs during his first two years in office. Ninety percent of them were to be in the private sector, of which about 400,000 would be in building roads, bridges, schools and broadband lines. Another 400,000 were predicted in solar panels, wind turbines, fuel-efficient cars; and one million in healthcare and education. The key term here was “jobs saved.” Any job not lost apparently goes in the jobs created column. I’m rather math impaired, but it seems to me that with real unemployment at about twenty percent and rising, and job losses predicted by the administration to continue for at least another year, it’s hard to see how the claim can be made. I suppose that as long as three million jobs remain in the US economy, Obama can claim to have saved them. I’d be the first to admit it’s all over my head, and a damned good example of why I am not suited for public office. Then too, I never did understand Bill Clinton’s surplus either. Political math is done in some fourth dimension anti-space where terrestrial rules do not apply.
    One thing I do know is that for every dollar a worker would earn under Obama’s plan, a capitalist corporation employing the worker would earn almost two dollars. That Mexican guy balling sod along the new highway’s median strip for the contractor may be making eight bucks an hour he wouldn’t have otherwise earned. But he is making his employer about $15.50 on the same hour. As a younger man in Colorado I balled sod, hired the Mexicans and passed out the paychecks, so I know. First rule about capitalist math is: The capitalist owner gets to do the math.
    So Obama’s plan lines more corporate pockets than those of the working man. This being America however, Obama was charged by conservatives with having an anti-capitalist socialist agenda. These businessmen conservatives are more than happy to take the money. But the rule of thumb in America is “Show No Gratitude! Bite the living hell out of any hand that feeds you, on the chance that it may give up more. Maybe even drop everything it is holding so you can grab it up and run while a crowd gathers to stone the alleged socialist.”
    But the truth is that Obama’s jobs would have done nothing to help the economy “recover” anyway. There is no economy left to recover. It moved to China and India. Things such as road projects do not generate capital. Under capitalism roads are worthless unless they make money, and they can do no economic good if there is nothing being manufactured to haul on them.
    Likewise education that does not contribute the gross national product (otherwise known as corporate interests) by producing higher wages to exponentially pump up American consumer fetishism is considered worthless. And let’s face it, higher education has become, for the most part, another racket. The student is saddled with massive loan debt (again, there is the odor of hyena banker spoor in the air) on the promise of eventual higher wages. Or at least that the graduate will work in a nice warm dry video store and never have to ball sod. Unfortunately, the number of jobs that require “college educated” Americans — quite an oxymoron, given the caliber of U.S. colleges these days — is shrinking right along with the Empire. All those jobs middle managing the Republic, such as helping us cheat on our taxes, brainwashing the school kids, and devising sales strategies for beer, grow scarcer by the day. Even book editing and reading medical scans are being outsourced to Asia. There’s a nasty rumor that American medical scans are being read in India by trained Buddhist temple monkeys to save rupees. The US healthcare industry has been mum on the subject.
    Obama’s recovery plan depends on going deeper in hock to the Chinese. For Christ sake, aren’t there any of our tax dollars lying around anyplace other than in Wall Street vaults? Apparently not. So the Treasury Department keeps cranking out more funny money to make payments on the pawn ticket for the Empire. Rather like those doddering old Englishmen one meets on estates in rural Kent sporting “The Queen’s Own” military ties, we still prefer to think of ourselves as an Empire.
    But the Chinese are looking askance, questioning the wisdom of pouring more money down a rat hole, based upon the US Treasury’s allegation that the other end of the rat hole comes out somewhere in China and not on Wall Street. Chinese talk shows publicly question American loans, when upcoming powerhouses such as Brazil are so ripe for investment. You can bet that if it’s on television in China, the public is being issued an official state sanctioned opinion they may feel free hold as their own.
    The big heist
    In the end the campaign rattle and prattle about Obama’s recovery plan turned out to be moot anyway. Wall Street moved in and heavied up on the whole damned country, in one of the ballsiest heists in American history. It was a stroke of pure genius as theft goes. Following a meeting of the Five Families, Citicorp, Bank of America, Morgan Chase, Wachovia, Taunus Corp., the financial cartels said, “The rip-off is in. We got it all. Now if you don’t hand over all the people’s savings and assets so we can loan it back to them, the whole flaming ball of shit you call the services and information economy is gonna come down on everybody’s asses like a giant meteor. So you can load three trillion bucks for now into the armored cars lined up out front and nobody will get hurt. Or you can watch the national economy shrivel up until the schmucks out there in the cul de sacs and cardboard condos can’t even put together cab fare for their ride to the poor house. It’s your call Barack.”
    There are still a few delusional souls out there who believe Obama is trying to do his honest best to fulfill campaign promises, but just cannot get past the pack of vampire financial corporations and cold blooded Republican lizards. Which is true in a sense. He cannot get past the Wall Street pack because he is running in the middle of it. Obama’s nefarious relationship with Wall Street’s power players has been ongoing for years. It is no accident that Wall Street got to select the members of the president’s financial cabinet. My mutton eating friends, it’s a sad and sordid tale, one I have neither the space nor the stomach to cover here. Especially since better journalists such as Matt Taibbi and others have written extensively about it in detail.
    Last I heard, the banks never un-assed the dough. Never let it circulate in the people’s hands or even through business loans. Instead, they declared a profit, divvied it up in bonuses, and congratulated themselves. Indeed, this was the sort of sheer brilliance we have come to expect from the Yale/Harvard MBA crowd. Getting rich by going broke. Then getting even richer by sticking up the US government and the entire American public, and eventually the entire world, leaving 1.5 quadrillion dollar cloud of toxic derivatives girding the world, to hoover up more money for them before imploding like a dark star. And indeed, the derivatives are even astronomical in nature. They represent $180,000 in debt load for every man woman and child on earth (although I cannot understand why, if the money isn’t real, why we should consider the debt real). It is impossible to produce our way out of this calamity. There aren’t even enough resources left on earth to sustain that scale of production.
    For now the financial mobsters have retired to Tuscan villas to savor their haul. The poor schmucks out there in the US heartland are left to devise new ways of hiding the family ride from the repo man. Never once, though, do they doubt capitalism. They figure it is all just a big financial accident. Fate. And that will somehow “work our way out of it,” like we always have. These things happen in a dynamic free market economy.
    A new mob moves in
    To backtrack, that was when the smell of long green flying out of the public — the insurance industry. Insurance racketeers moved in with their own muscle to fill the void left by the Wall Street gang. The insurance syndicate dispatched its made men and soldiers throughout the halls of Congress, and, voila! They were able to pass the aforementioned $70 billion a year political blackmail job off as “reform legislation.” Say what you want to about my country, but pillage and looting have never been so elegantly ritualized, institutionalized and executed.
    Realistic people on the left have long known that the last act of American strong-arm capitalism would be a massive gunpoint redistribution of wealth from the public to the owning class through the private financial sector — which the owning class happens to own. But few would have expected it to be executed under a Democratic majority in both the House and the Senate. Or under a Democratic administration honchoed by the first black president. One liberal blogger wondered aloud, “Imagine what the Republicans would have done had John McCain been elected?”
    The same thing, brother. The same thing. Only with a different cover story. Both parties exist at the pleasure of the same crime syndicates.
    How to join the rackets
    As I remember, it was a Mexican diplomat who once told me that graft, theft and bribery are socialized in his and other Latin American countries — democratically distributed throughout much of society. But in America, he said, this sort of criminal activity is legislatively institutionalized. Only the elites are allowed to practice usury, theft, insurance blackmail and other forms of non-violent looting (violent looting being reserved for oil bearing Middle Eastern countries). The first step in building one of these rackets is to become a legally recognized interest group, in order to access the key Congressional players you wish to bribe or strong-arm into acquiescence or complicity.
    The banking mob, the insurance mob, and other criminally organized legislative muscle men, cartels and commodity syndicates, are all officially sanctioned as “interest groups” operating alongside hundreds of others in that whorehouse by the Potomac River.
    To list just a few, there are environmental interest groups such as the Sierra Club, which exists so its officers can draw fat salaries and meet movie star environmentalists. There is an interest group for education, which exists to assure the mediocrity of our public schools. Munitions manufacturers are an interest group. Gambling casinos and tobacco corporations are interest groups. There is an interest group to force feed us corn sugar, in order to sustain Midwestern Republican farmers and ensure the future of the ever expanding weight loss and diabetes industries. There are even lobby groups to protect the interests of syndicates in other countries, such as Israel. There is an interest group for everything except we ordinary American pudwhackers. The folks who just want to raise families in peace, and maybe have modest financial security in old age. And there are thousands of interest groups whose purpose is to make damned sure we never get either one.
    We ain’t mean, just thrifty
    Yesterday I watched a CNN host ask two experts: “Is stepping up the war in Afghanistan really the best use of our tax dollars?” The killing, maiming and displacement of untold thousands is discussed in terms of the best use of capital. A dehumanized and monetized capitalist society sees everything in dollars and cents and return on investment. Even infant mortality is rated that way, though seldom does anyone admit it. Saving a black ghetto baby has a low return on investment, according to some human services analysts, as regards their lifetime contribution to the gross national product. I actually heard an expert on a television panel show say this.
    Yet Americans sitting in front of their TV sets do not find this one bit odd. Or even mean spirited, much less an indication of a cruel society. No American thinks of himself or herself as cruel, or connected in any way with the world’s largest human and environmental killing machine. No American doubts his inalienable right to drive around or run air conditioning or drink wine from grapes grown in Chile at the expense of a national war on the environment and those of the world’s people who have been born amid energy resources. If there are things such as cruelty and injustice, we the people aren’t the ones doing it. We the voters and taxpayers are not the CIA snatching people off to Uzbekistan and Turkmenistan to be raped with broken bottles and boiled alive to extract those “terrorist confessions” that keep the war on terror alive. We simply finance such operations.
    And accountability? Well, on the very slight chance that someday the world will hold America accountable (which will never happen so long as we possess more armaments that the rest of the world combined and are quite clearly willing to use them toward our own ends) we the people can express our shock and disgust as citizens. We good people would never, never, never have approved of all those awful acts. And besides, there is not much the ordinary person can do about such things anyway. Right?
    Maybe not. But it was Americans who so loudly proclaimed that complicity through silence is no defense, when we rubbed the German people’s noses in the grisly filth of the concentration camps and hung their national leadership.
    The revenge of Smirking George
    We haven’t heard much from George W. Bush since he packed up his comics and moved to Dallas. But his policies remain like dog piss stains to stink up the Obama White House. Rendition and assassinations continue, as does warrantless spying on the citizenry, along with other civil liberties violations in the name of the “war on terror.”
    All of these are terrible things for a president who ran on reform and change to continue to do. But it is the thing Barack Obama and his party did not do, the thing they did not insist upon, that will have the greatest ongoing effect on this country. Obama and the Democrats refused to prosecute Bush and Cheney, ensuring that:
    1 — No quail hunter is Georgia will ever be safe as long as Cheney’s pacemaker still functions;
    2 — The precedents set by the most criminal administration in US history remain. Until they are confronted and rectified, America will not to have the opportunity to heal and recover. Honestly speaking though, the patient has been dead since the 2000 election fraud went unchallenged.
    Obama’s election was the only chance America had to hold the Bush Republicans accountable for their crimes. Now it’s gone.
    Opportunities to exercise moral principles as a nation and a people are rare to begin with, and fast vanishing. At some point they will be extinguished by the exigencies of human species survival. It doesn’t take a prophet to know this. Anyone paying attention to planetary population, resource depletion and the eco-collapse understands it in the gut. The mounting worldwide competition for human survival will not allow for much high mindedness. So we should exercise principle and administration of justice while principle and justice are still possible.
    There are endless rationalizations proffered as to why Obama has not come within a mile of fulfilling the promise and potential of his presidency, and the Democratic Party is writing more of them every day. Disappointed Democratic voters grab at them, and desperately defend each one on internet forums and in letters to the editor. But we must use our own personal capabilities as free rational human beings to assess Obama, and decide why he is failing. Or not failing. To hell with highly crafted official explanations about “wars of necessity” and trillion dollar blackmail payments.
    George W. Bush left office wearing the same smirk he came in with. Perhaps it’s congenital. But if Bush was smirking when he left office, he must now be convulsed in crazed hysterical laughter. His gang not only got away clean, but Obama carries on the dark Bush-Cheney legacy. And, almost as if to top the whole black escapade with a cherry of irony, the most inarticulate president in American history is now on the motivational speaking circuit at $200,000 a pop. Never let it be said that the Devil does not care for his own.
    Will Americans ever rise up in defense of their own common well being through such things as education, health and a productive peace caring society? Nope. Because it has been seen to that socialism — the administration of the nation solely for the common good and benefit of all the people without preference or privilege — doesn’t stand a chance in America. For over a century those who have attempted to further socialism have been shot, hanged, burned alive in their beds on Christmas Eve, imprisoned, falsely accused of crimes and falsely convicted, and demonized by the capitalist elites of the corporate state. The cause of socialism has effectively been wiped out in the US. Few Americans can even define the word. Most think it is a political system when it is a social philosophy. Hell, half the socialists these days think it is entirely a political system.
    But even if Americans understood socialism, they are too terrified to ever admit to its virtues, much less publicly support the cause. And without free and open public participation in some democratic form of socialism, regardless of the name or label given it, there can be no recognition of the people’s common welfare and good. And so the most egalitarian social philosophy ever conceived dies within a nation, with very little chance of being reborn because such an ideal, by its definition, cannot exist within the narrow mindset of bankers and oligarchs.
    Bush smirks, Obama breakdances in and around the minefield of his false promises, and Wall Street CEO bonuses are higher than ever.
    Like I said, the Devil does take care of his own.

  • 48. seebee  |  March 30th, 2011 at 9:39 am

    @GhostUnit

    If you have adblock you can right click and block the Glen Beck picture so you don’t have to look at his retard face any more (here, at least). That’s what I did and it has improved this site a lot.

  • 49. dreorig  |  March 30th, 2011 at 9:45 am

    Gold inflow/outflow worked when all countries were on the gold standard. If we go back right now, we have to revalue the dollar to gold, and you have a massive deflation as everything revalues. The next day, China would show up and demand to convert all of their dollars to gold (or rather, treasuries to dollars to gold) and take a quarter of the US gold reserves back to China. This would lead to another huge deflation. We would never get that gold back, since China is not on the gold standard and does not have to convert their money to gold. Every other country holding our debt will demand to convert it to gold, leading to persistent deflation of the money supply as our reserves decrease and increasing prices of absolutely everything in this country. Eventually we would have so little gold left that we would have to go back off the gold standard, putting us right back where we were, minus our gold reserves.

    Seriously, if you’re all hard for gold go buy some. I own plenty of it. If you can’t afford gold buy silver. But going back to a gold standard would be suicide, unless we could get the entire rest of the world to go along.

  • 50. SN  |  March 30th, 2011 at 11:19 am

    a return to the gold standard would destroy the credit system. A paper credit system that makes claims on future returns ameliorates the profit killing pressures of falling marginal prices and rising fixed costs. A return to the gold standard would vindicate volume 3 of Kapital. Libartards can’t get their heads around industrial capitalism. Their models assume no large scale long term investment in sunk and lumpy industrial technology and all the consequences that that technology has entailed in terms of scale and scope of markets, capital, consumer goods, need for upfront credit, turnover times etc.

  • 51. wengler  |  March 30th, 2011 at 11:34 am

    A gold standard is an incredible hardship to debt holders because it’s typically a counter-inflationary monetary system. This is why Ron Paul likes it, because you can just print money and turn the US into Wiemar Germany in the ’20s, blah blah blah. He must’ve missed the part where rich people in this country are obsessed with keeping inflation low, because their primary business is tending their slaves, ahem, I mean investing. So no worries there, Ron.

    What Ron Paul and other teatards should realize too is that the value of gold works in the exact same way as the value of money. A group of people assign it value based on history, culture, and psychology. Precious medals can inflate too. Just look at the Spanish Empire’s obsession with precious medals that led it to not only torture and kill millions of native slaves, but undermined their own empire’s wealth by mining too much silver out of the New World.

    Ron Paul’s allegiance to the Gold Standard must be motivated by his Gilded Age fundamentalism.

  • 52. gyges  |  March 30th, 2011 at 11:39 am

    So what do you make of Greenspan’s famous quote,

    “This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.”

    from, Gold and Economic Freedom.

  • 53. Dejo  |  March 30th, 2011 at 12:01 pm

    Fiat currency of any kind concentrates power in the hands of a few. The gold standard legally binds how much money the government can print to how much gold it has in its reserves so gold barons, or whatever, would be a thorn in the government’s side. It’s nothing but a semi-tangible way of putting a cap on how much money the government can make. Of course, the only way to truly eliminate monetary inflation is inconvenient. Especially for the government. I mean how can you tax somebody when they use cattle or booze as currency?

  • 54. wengler  |  March 30th, 2011 at 12:44 pm

    @52

    That quote is the best endorsement of NEVER going back to the Gold Standard ever again.

    The cure for deficit spending is raising the taxes of the rich. Should we consider confiscating the property of the class that has grown fat on devouring the lower classes over the past 30 years? YES…YES…HOLY FUCKING HELL YES.

  • 55. wengler  |  March 30th, 2011 at 12:54 pm

    @53

    I hope that was a sarcastic question. Because if it isn’t it portrays you as someone that has a stunning ignorance of history.

    Taxes can be levied in currency, assets, and service. If booze is your currency, you will be taxed in booze. If cattle is your currency, you will be taxed in cattle.

  • 56. Patriot  |  March 30th, 2011 at 4:17 pm

    Fiat currency has value because a sovereign government compels you to use it to pay taxes. MMT 101. Look it up.

  • 57. I1  |  March 30th, 2011 at 7:45 pm

    The world is already on the Gold standard. It was never taken off. Some have just forgotten.

    http://www.newyorkfed.org/education/addpub/goldvault.pdf

  • 58. Tom  |  March 30th, 2011 at 9:09 pm

    Who cares about this argument between gold and paper bugs. If you believe in paper, save in dollars. If you believe in gold, buy gold. We`ll see who is right and rich and wrong and poor in the near future…

  • 59. Dejo  |  March 30th, 2011 at 9:39 pm

    Better yet, invest your money in something which will have a high demand in the future like bullets or booze.

  • 60. gyges  |  March 31st, 2011 at 2:24 am

    @54 If you want to level the playing field, Wengler, consider taxing

    (i) borrowing/lending
    (ii) benefits

    and changing the law so that rent buys equity.

  • 61. W. Kiernan  |  March 31st, 2011 at 12:01 pm

    The part that puzzles me is where Paul says:

    “…And again, if they got a lot of dollars from us because we were buying cars, what are they going to do with their dollars? They have to either buy debt from us or invest in our stock market…”

    Isn’t the whole idea of a gold standard that one can take dollars, pounds, Eskimo pence, whatever to the national treasury and say “Please redeem these pieces of paper for their face value’s worth of gold metal”? So if the Japanese have a bunch of dollars, they don’t have to buy any American goods at all; they can trade them for shiploads of fungible shiny gold to spend where they please.

    As to how Paul got so incoherent, note that he is a doctor, which means he can freely write himself prescriptions for whatever pharmaceuticals his heart desires. Envy, envy!

  • 62. CensusLouie  |  March 31st, 2011 at 12:08 pm

    Ha ha, oh Doug. Is it Wharton’s economics program that teaches you gems like “the rich are tapped out”?

    What’s up, #42!

    “CensusLouie: If ‘modern civilization’ means massive faceless bureaucracies controlled by elites, as all bureaucracies without exception always have been and always must be, despite everyone’s efforts to get them into the Matrix, is still pretty close to half of ‘em – want to smash it. You have a problem with this …why?”

    Ha ha! The Matrix! Smash the system, dOOd!

    Here’s the problem with you libertarian retards: you think things like the department of education, national health organization, and FDA are a “faceless bureaucracy”. You haven’t the faintest understanding of government, economics, or law beyond things which immediately affect you. And since these “faceless bureaucracies” don’t immediately provide you with a shiny new car for your tax money (as they should according to Lord God Adam Smith invisible hand immutable economics free market law), then it’s beyond your understanding and you want to tear it down along with anything else worthwhile and complicated. This is because you and all libertarians are fucking retarded children.

    Would the free market eventually sort out building contractors who kill people with shoddy construction that didn’t adhere to any fire codes (more faceless bureaucracy!)? Or unlicensed doctors who kill patients (just like 1984!)?

    People like you honestly believe we’d all be better off living in a wild west frontier town. At the very, VERY best, assuming all your idiotic economic beliefs actually worked, libertarians believe in social Darwinism.

    And for that, you and all your fellow libertarian retards can die in a fucking fire, you fucking child minded monster. Move to a bunker in Montana and tear down your own infrastructure. Leave ours alone.

  • 63. old news  |  March 31st, 2011 at 6:26 pm

    http://foto.lib.ru/img/w/wanjukow_a/alb_0220/08.jpg

  • 64. 16 Shells from a 30.06  |  March 31st, 2011 at 8:03 pm

    It’s not the fiat currency that ails us. If the motherfuckers are hitting their marks, a fiat currency is functional and equitable. But when the motherfuckers are playing fast and loose with the dollar? Wielding the inflation tax like it’s a revival of the feudal lords and serfs model? When shit goes bad like that? It’s not the fucking currency that’s doin’ us in. It’s people! Our glorious fucking masters? They’re people! This is like having it in for the Stanley corporation…because your master keeps hitting you with one of their hammers.

    Sometimes, I think Ron Paul is a false flag op, put in play to sow chaos and confusion in the ranks.

  • 65. Carl  |  March 31st, 2011 at 8:05 pm

    The reason we are no longer on the gold standard is that the people who had to live with it got rid of it.

    If you like gold backed money, you like deflation.

    If you like deflation you are either rich or you are a retard.

  • 66. Dejo  |  March 31st, 2011 at 9:15 pm

    Yes, Carl, because the millions of poor people who have money in the bank are stupid for wanting their money to be worth a damn. And people in nations whose currency is worthless when compared to the dollar sure are living it up. The only people inflation helps are those who have most or all their money invested in assets/commodities. Take a guess whether it’s the poor or the rich who’re more likely to be in such a situation. The reason governments gave up the gold standard was because they didn’t like having limits on how much money they could print.

    That aside, as long as America can keep threatening other nations into accepting the dollar as legal tender then there shouldn’t be a problem. If, however, other nations start dropping the dollar then America will make Zimbabwe look economically stable.

  • 67. Jack Boot  |  April 1st, 2011 at 8:59 am

    Whether its currency be backed by gold, wampum or cowrie shells, the only way the USA can reduce its trade deficit is – wait for it – to build stuff the rest of the world wants to buy!

    With ever-fewer exceptions, US manufactured goods (bulky, shoddy, energy-consumptive & not metric – rather like their builders, actually) don’t travel well.

    Unless America’s CEOs stop playing with money and make some effort to compete, the future shan’t be pretty…

  • 68. steve  |  April 1st, 2011 at 1:04 pm

    The gold standard is a deflationary device to screw the entire society on behalf of the financial sector which is the only sector that will benefit. This is why Paul and his libertarian legions have elevated this goldbug drivel to being the hottest fad we’ve seen in the political sphere in a long time. It reflects the growing power of finance capital whose profits hover around two-fifths of all US corporate profits.

    Gold prices should be allowed to fluctuate on the market like all commodities. If the dollar price of gold can’t adjust to changes than prices fall to compensate causing a deflation which leads to bankruptcies, credit drying up, recession and massive unemployment. All this to ensure that the financial sector’s outstanding debts aren’t cheapened by gradual price increases.

    In addition, the Fed will be forced to raise interest rates every time the US dollar weakens against another hard currency in order to maintain the value of the dollar at its gold parity. Recessions will surely follow and chronic stagnation and unemployment will be the result. In addition, this ongoing pattern will destroy much of the nation’s necessary fixed capital stock as businesses go bankrupt output falls and sales plummet for want of effective demand and investment shifts into purely financial assets.

    This is not to say that gold is a bad investment or that the general public shouldn’t be allowed to own gold. It just means that the currency should not be tied to gold and that the federal government is left with the flexibility to pursue needed quantitative easing when needed.

  • 69. Tom  |  April 1st, 2011 at 3:56 pm

    If gold is bad and dollars are good, then why is the dollar collapsing in value against gold/silver/oil/cotton etc.? Seriously, check out some prices, the fall in the doolar is parabolic at this point. And how is this fall in purchasing power (aka inflation) good for poor people?

    I`m sure a fiat currency system could work in theory, but it never has worked in practice. The temptation to debase the currency by increasing the money supply is just too great leading to what we have now. Inflation and a flight to commodities. This will end soon when the fall in purchasing power of the currency gets so bad that no savers can be found to trade goods and services for paper.

  • 70. Plamen Petkov  |  April 2nd, 2011 at 12:40 am

    OK, I will byte. Where is the evidence Ron Paul is a Koch front? I don’t think much of him either way, to me is talks a good game but doesnt do anything of any substance. When he dropped the “audit Federal reserve” ballot he wanted passed so much I stopped being interested in him.
    So anyway, lay it on us. I can take the evidence if it exists. And what we got now isn’t much better than the gold standard either. By dropping the gold standard Nixon gave USA a shot in the arm and allowed it to star borrowing and living on borrowing for the last 40 years. So Nixon technically saved USA by dropping the gold standard.

  • 71. steve  |  April 2nd, 2011 at 9:50 am

    Tom,

    The “fiat currency” system is working in practice; in fact it is the only system that ever has worked. The real barometer of the strength of the US dollar is US treasury bond yields which are still quite low; investors are lend us money at a low rate of return. Must be that these investments are safe!! Furthermore, we have deflation not inflation. The financial sector loves deflation because it increases the value of their only asset…MONEY. But trust me, it is very disadvantagous to the rest of us!!

  • 72. adssa  |  April 2nd, 2011 at 3:35 pm

    i know right! everything i don’t understand is also wrong! i like to talk about the “logic” of arguments even though i don’t actually understand them or provide reasoned objections to them! stupid paul-tards! childish insults are infinitely better than stupid dumb idiot paul-tard arguments! logic!

  • 73. CensusLouie  |  April 2nd, 2011 at 7:36 pm

    I like how most of the con arguments to a gold standard are grounded in informed fact, and the pros are all these ridiculous regurgitated fantasy land sound bites.

    Things like #66 who seems to think that it’s poor people who fear their oodles and oodles of savings (no living paycheck to paycheck for them!) will be devalued, and that it’s not your lower to middle class citizen with a big ole chunk of mortgage debt that’s mitigated by inflation.

  • 74. Timur  |  April 3rd, 2011 at 12:32 am

    I don’t see whats so difficult to understand.
    Mark Ames losing his intelligence after years of drug use apparently.

    The argument can be summed in 3 very simple statements.
    1) Fiat money, can be created at will by the central bank, leading to ever increasing supply of money, rising prices, and the confiscation of savings through rising prices.
    2) Gold is limited in supply and therefore any money with gold backing would be limited in supply.
    3) With the limited supply of money all of the following would be impossible:
    1) Spending more than you have (Trade deficits).
    2) Spending more than you have. (Deficit spending)
    3) Spending more than you have. (Positive total systemic debt-Everybody being a debtor)
    4) Spending more than you have.(Deflation will encourage savings.)

    So there you have it. Apparently Mark Ames political philosophy is based on the neccessary misunderstanding of simple economics.
    -Amir Timur

  • 75. Dejo  |  April 3rd, 2011 at 1:40 pm

    Louie, it’s kind of hard to live on cash when said cash it worthless. Still, all people have some form of cash reserve. But yeah, you totally got me. Home owners might get off the hook, if the government doesn’t intervene again. It’s too bad they won’t be able to afford everyday goods with their savings, though.

  • 76. 16 Shells from a 30.06  |  April 3rd, 2011 at 5:53 pm

    Let me say this again: The fiat currency racket isn’t what fucked us over. People did. Instead of pissing and moaning about the fiat currency racket, and trying to kill it for enabling criminal acts, we should be pissing and moaning about/trying to kill our glorious wealthy masters who butt fucked the economy via the dollar. All this shit is a limited hangout drill. Where our leaders acknowledge that mistakes were made, but choose to key solely on the mistakes, not the wealthy elite criminals who made them. The currency is a tool, the banksters are the criminals. If I beat the fuck out of a Paultard with a shovel, you asswhipes would be here yelling for the criminalization of shovel possession.

  • 77. Tom  |  April 4th, 2011 at 2:48 am

    Steve,

    Thanks for the thoughtful response. I would agree that low interest rates are a sign that a currency is safe since investors are willing to accept low yields in exchange for their capital. But the US and Japan have been purchasing government bonds for the past few years and thereby are driving down the yields outside of the market. Also, the deflation isn`t uniform. Some things are falling in price (housing for example) while others are rising (gold and silver).

    Anyway, it all comes down to an individual`s faith or lack thereof in the people running the currency even in a gold standard. No faith means the currency fails regardless of the guarantees of the central government.

  • 78. Timur  |  April 4th, 2011 at 4:49 am

    @ 16 shells
    Well if you have a mob of retarded and deranged sociopaths, would not the confiscation of their shovels be the wisest move?
    The nature of the government is not going to change so long as you have a democracy(except for the worse) So the only thing to be done is limit the damage they can do and WILL do.
    Hence the gold standard instead of FIAT currency.
    Timur

  • 79. 16 Shells from a 30.06  |  April 4th, 2011 at 9:08 am

    Nope. I’d thin the herd of retarded and deranged sociopaths. With this lot, if it’s not one goddamned thing…it’ll just be another goddamned thing. Cut to the chase. Take ‘em down early. And the whole gold standard fetishists gig isn’t what we need. We are being ruled by scumbag filth. This doesn’t mean we need to adopt an intentionally crippled and retarded economy based on the gold standard to hobble commerce and limit the damages done by the fucked in the head elitist scumbag filth who stand astride us and fancy themselves masters of the universe. It means we need to deal with our current scourge of crazed corrupted economic masters who are industriously fucking shit up for everyone.

    There’s not enough gold in the world to smooth over what’s being done by the scumbag elite, jackbooted and spurred, riding the mass of mankind like we have saddles on.

    Fuck the gold standard. It’s time to hoist the black flag and start to slitting throats.

  • 80. Perfect Tommy  |  April 6th, 2011 at 1:30 pm

    Gold is money, whether we like it or not.

    Don’t believe me? 3,000 years of history is on my side.

    Gold is money because it EVOLVED into money. Human beings, over the course of time, figured out gold had all the best characteristics that money requires.

    Scarcity– check. Gold is very rare in the earth’s crust, and difficult to mine and refine.
    Durability– check. Gold is relatively hard, does not corrode or spoil, and is extremely ductile.
    Fungibility– check. Gold is uniform and can be subdivided into extremely small units.
    Density– check. Even high-value transactions can be conducted with relatively small amounts of gold.
    Esthetically pleasing– check. Gold’s physical beauty and ability to be turned into works of art increases its appeal and desirability.

    The fact is, the world still operates on a gold standard, although that’s not what the global bankers want you to think. Why do you think that central banks still hold gigantic amounts of the “barbarous relic”, even in an age of Infinite Fiat? Fiat money is for the billions of idiots in the world who don’t know any better. Gold is for the people who do.

  • 81. 16 Shells from a 30.06  |  April 6th, 2011 at 5:10 pm

    Speed can also be measured in furlongs per fortnight. It doesn’t mean that should somehow be the current standard. You gold bugs are cowards. You fob off blame for getting fucked in the economic ass onto the means of the fucking (the fiat currency), because you’re too polite/cowardly to address the sorry fact that you have a pack of robber baron elitist scoundrels’ 18 inch cocks balls deep in your butt (metaphorically speaking, of course).

    Why would everyone have to live in a ruinously simple economy with nigh on zip for economic velocity, just because you couldn’t bring yourselves to address your (very human) oppressors? Fuck you, goldbugs. You have more cash than sense. I, for one, look forward to the day when the government segues from cryto-fascist to proto-fascist, and decides it’s necessary to come after the goldbugs’ stashes. You know it’s coming. What are you gonna do then? Will you finally grow a pair when they (again) make citizen possession of gold coin illegal? Probably not. You’ll just turn into Smeagle, pawing your stash, muttering “my precious…”, all the while living in abject poverty.

    Gold won’t save you now, assholes. Get up off your haunches and come up with a plan of action that doesn’t include jerking off to the notion of gold saving you from the economic chaos to come. You’ll be better for it.

  • 82. Jason  |  April 8th, 2011 at 7:12 am

    I have been researching the Gold Standard lately and i found a website that has some useful information on The Gold Standard if anyone is interested in reading about it….Heres a link to the site:

    http://www.kochind.com/

  • 83. Lavrentij "Anarch99" Lemko  |  April 8th, 2011 at 11:24 am

    Yves Smith wrote a really good description of the conditions for hyperinflation here:

    http://www.nakedcapitalism.com/2011/04/what-are-the-preconditions-for-hyperinflation.html

  • 84. 16 Shells from a 30.06  |  April 9th, 2011 at 11:25 am

    Yves Smith didn’t write that, she’s off at a conference. ’twas a guest post by some ivory towered goldbug. He is right about hyperinflation being pretty far out there on the probability curve. Gold’s rise is but a sign/symptom of what ails us, any attempt to use it to hedge against chaos is misguided like a motherfucker. Like giving a fever wracked patient with a badly infected foot ice for the fever. The patient (our economy) needs antibiotics and/or surgery, and all the ice (gold) in the world won’t change that.

  • 85. Lavrentij "Anarchy99" Lemko  |  April 9th, 2011 at 4:07 pm

    So, 16 Shells from a 30.06, if you have a few extra bucks and are a cynic, where would you recommend investing that? Down at the Disco Inferno on this Saturday evening? Or in a Glock 19? I ain’t no Paultard, a man whose prescriptions would but ‘roid up the cancers. The economics of dropping one’s money in something going up (like gold and silver, for the past decade) rather than in the Wall St. (or hiding one’s savings under the mattress) make obvious sense if one has been doing it (learned from my depression era grandparents). Will they cure the Sick Beast? Fuck no. In fact, there ain’t no cure.

    But when you need a plane ticket to Canada or Europe or, fuck, Central Asia/Russia, having a few pounds of the white or yellow metal just might come in handy.

    – Lavrentij “Anarchy99″ Lemko, aka “the Lombard”

  • 86. Lavrentij "Anarchy99" Lemko  |  April 9th, 2011 at 4:11 pm

    One more thing, 16 Shells from a 30.06, my apologies for misattribution of the link.

  • 87. Hazard Circular  |  April 11th, 2011 at 7:11 pm

    Quoting someone above:
    “How well an economy functions is based on how quickly money moves around.”

    Exactly so! Now, then… if only we can make money circulate fast enough, each and every one of us can make one million dollars, each and every day!”

    I’m sold.

  • 88. wccarnes  |  April 12th, 2011 at 7:54 am

    The following message was crafted by underpaid sockpuppet professionals at New Media Strategies:

    Sure. The Koch brothers hired Ron Paul. They don’t just support him because they agree with his ideas, but they interviewed him and stressed over who they were going to get to fill a position that they had for someone. That makes alot of sense. I thought that lefties brutally ridiculed people who throw out conspiracy theories. But hey, who needs self awareness when you’ve got such a solid case like Mr. Mark Ames here. Jesus christ, what the fuck am I talking about? Was that sarcasm? I don’t know. You tell me. I couldn’t even follow my own Koch-approved libertard titty-twister logic. But it’s not my fault. I’ve been in the New Media Strategies dungeon working a 24 hour shift with only one bathroom break and no overtime pay at minimum wage…

  • 89. 16 Shells from a 30.06  |  April 12th, 2011 at 10:26 am

    to paraphrase some sage or another,

    we can start by not lying so much, treating other people like dirt, and try not to base our lives on how much we can scam.

  • 90. Interested  |  April 12th, 2011 at 2:30 pm

    The only ‘tard’ here is the author of this amazingly stupid comment I’m about to post. Hopefully, the editors will stop me before I pollute this planet any more than I already have.

  • 91. Interested  |  April 12th, 2011 at 2:38 pm

    What is TRULY amazing is that the very same people who would make Paul out to be ‘crazy’ are the very same people, no matter which way they lean politically, who are undoubtedly really pissed-off at the government right now over one thing or another (how’s that retirement plan working for you? Savings? How’s that mortgage doing – is it above water yet?), yet in their efforts to rip-apart Ron Paul they are standing against the only elected official who has the balls to tell them the truth and would have done a lot to prevent whatever it was they are pissed-off about if they hadn’t insisted on voting for the same people responsible for everything wrong in the country, and everything they are pissed-off about: the Demopublicans. Good job! (not).

  • 92. Amir Timur  |  May 8th, 2011 at 7:58 am

    @16 shells:
    The ironic thing is that the next major political/social upheavals, and violent revolutions are all going to be a reversion to historic/conservative norms of society. If you observe any modern democracy, you can see that only the radical conservatives are capable of violent action for political ends.
    This is only natural as modern democratic states have divorced themselves from the tribal/ethnic structure of the nation and are now ready to be exterminated.
    This is natures way. Only the tribe matters, the nation is always temporary.
    -Timur

  • 93. gigi  |  May 12th, 2011 at 9:31 am

    this article is garbage(social-ist crap).so the barons(state) are printig toilet shit and keeps us as slaves.
    if you keep the product of you work in paper they will make you a poor man who needs to get ,,benefits” from master (aka state)

    ps:some people are born to be sheeps

  • 94. Joel Pettit  |  June 2nd, 2011 at 9:25 pm

    If you think Ron Paul is a shill for the kochtopus you’re fucking retarded Ames, and haven’t done your homework at all. I like a lot of stuff on this website, but this is just piss poor. You need to let go of your class-warfare ideals and slick high-school-know-everything-sarcasm just long enough to do a little studying. All you can do is write; why don’t you take a break and study a little bit you douche. You tie everything that leans a little “right-wing” up into one nice little package. You have vastly more in common with Joe Stalin than Ron Paul has with the Koch brothers. Please just take the smallest bit of time to read “What Has Government Done to Our Money?” by Murray Rothbard, and try, try to understand these few things:

    Ron Paul is NOT a Koch shill.

    Austrian economics is NOT synonymous with Ayn Rand and objectivism–AT ALL!

    A true global gold standard would be the most detrimental to the Kochs–more so than any of your commie-fantastic government clampdown!

  • 95. Jerry  |  July 1st, 2011 at 2:02 pm

    Oh Yes I want a floating dollar…. Kind of like I would rather be the floater in a cesspool.
    I just hope we do not all drown in the dollar cesspool like we have in the welfare cesspool.
    Yes…. Just keep printing and we will save the world Zimbabwe Style.
    Ron Paul in 2012 because the alternative is “Meet the new boss same as the last boss”

    Because Ron Paul, he’s really sooo different, you know? He’s for giving corporations and the billionaires EVERYTHING they want. That’s radical, man!

  • 96. wccarnes  |  July 25th, 2011 at 12:09 pm

    Gold’s at $1,612.97 as I write this. Silver’s over $40 and heading up again, and the dollar continues to be axed by your beloved communists. Wake up Mark, you obviously have no idea what your talking about. I mean, just because gold and silver hit almost the exact same bubble-peak in 1979-80 as today (only in real dollars less than now), just because it all crashed down for 30 years afterwards, doesn’t mean that this time isn’t different and this time isn’t real. It’s not different and not real, but i’m just saying, you know

  • 97. deminohio  |  August 6th, 2011 at 10:36 am

    Brilliant.

    William Jennings Bryan + 100 years of social devolution= The working/middle class, begging to be crucified on a cross of gold.

  • 98. Mike  |  October 31st, 2011 at 7:24 pm

    The only retard here is the mom of the guy who wrote the comment. I’m not even a sell out who works at a bank or for a public relations outfit. Just some poor person who is on welfare, food stamps who refuses to take some responsibility for himself.

  • 99. pat  |  January 14th, 2012 at 6:29 pm

    Biblical Capitalism/Christian Reconstructionism that is the deal with these people and their fascination with gold. Gary North, Rushdoony, both former Paul staffers. Howard Phillips/Conservative Caucus and his son Doug Phillips.

  • 100. deer yesac  |  May 18th, 2013 at 3:02 am

    ps: am a baboon, i fling shit around my cage, like red anus, tard


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