Ron Paul Wants Us To Use Gold And Silver Along With Paper Money

Ron Paul, career-long proponent of outmoded and discredited Austrian economic theory, went on Colbert last night to talk about how paper money sucks and he wants you you to be able to go into a store and buy a six-pack with some gold ingots. His proof? Paper money can rot and people have believed in the value of gold for centuries. So, gold is “better” because the collective hallucination around it is stronger. This wouldn’t be disturbing except for the fact that Ron Paul is the new Chairman of the House Financial Services Subcommittee on Domestic Monetary Policy. Yeeeeeks.

The Colbert Report Mon – Thurs 11:30pm / 10:30c
Gold Faithful – Ron Paul & David Leonhardt
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Gold Faithful – Ron Paul & David Leonhardt [ColbertNation]

RELATED: Ron Paul: Fed ‘monopoly’ could be broken if Americans use gold, silver as currency

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  1. FireJayPa says:

    You can print more paper currency based off of nothing which deflates it’s value. You can’t create more gold..once it’s gone it’s gone.

    • Skeetz says:
    • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

      “The Twilight Zone” The Rip Van Winkle Caper:
      After successfully stealing a gold shipment, a group of criminals and their scientist accomplice put themselves in suspended animation in a remote desert cave. When they awaken decades later, and kill each other over the gold. The last man left offers all his gold to a couple from the future in exchange for water, before dying of thirst.

      Future Man: “He offered me this, like it was worth something”
      Woman: “Didn’t it used to be, before they found a way to make it?”

      Just something to think about…

    • exconsumer says:

      Sure you can, you just reduce the amount of gold redeemable per dollar.

      What many hard money proponents forget is that hard money doesn’t exist. All currency, more or less, is fiat currency.

      • RvLeshrac says:

        You misunderstand. Ron Paul wants us to use *ACTUAL GOLD* as currency.

        • c!tizen says:

          and what is our paper money backed by? Paper money is basically a certificate of gold. I think what he wants to get back to is a method of having the actual gold to back the money circulating around the world instead of it being backed by the promise of the fed that paper money is actually worth the denomination printed on its face.

          • exconsumer says:

            I’m afraid that’s completely incorrect. Our paper money is in no way a certificate for gold or any other resource. You can pay your debts with it and pay your taxes. That’s it.

          • Mom says:

            Not so much. The U.S. dropped the gold standard in 1933, in response to the depression. Most other countries did the same thing around the same time.

        • Putaro says:

          Good luck with that. Gold is at $1300 an ounce right now. How big do you think a $1 coin is going to be? Or even a $20 or $100 dollar coin. Better get your tweezers and magnifying glass ready.

        • Bill610 says:

          Cool that you know what he’s thinking, considering that he said the exact opposite in the video: “You can have a certificate, you don’t have to carry your gold.”

        • Darren W. says:

          No. He really doesn’t, despite the impression given in this interview. What he really wants to do is legalize competing currencies. So if I want to convert my money into a gold backed currency, then I can. On the other hand, if I want to keep my savings in a currency backed by flamingo droppings, that should be my choice too.

    • Strider817 says:

      You can’t create more gold, but when more gold is discovered, the price will rapidly decrease.

      • exconsumer says:

        Which is another drawback of hard money. Other countries would be allowed to manipulate US Currency values by buying or selling gold (or whatever standard we choose). Even if the whole world agreed not to do such a thing, gold would still have it’s own market and would increase or decrease in value accordingly and apply inflationary (speeding up) or deflationary (slowing down) pressures on the economy. Sure, our current system crashes or spikes when the economy gets tied to a single market (housing, tech) but thats when things go wrong. Suggesting that we tie the speed of the economy to the price of a single precious metal is just foolish.

        • Daemon Xar says:

          Particularly when a whole cottage industry has sprung up around manipulating this particular market . . . with Beck as it’s messiah.

          • Bsamm09 says:

            If you think the people who listen to Glen Beck make any impact on the market, you are mistaken. Get your butt over to Zero Hedge now.

            • Daemon Xar says:

              I think generating massive demand on the market among people too stupid to know better absolutely affects the market. How would it not?

          • Awesome McAwesomeness says:

            Ah, Glen Beck. I was wondering what The musician had to do with gold…

    • eyesack is the boss of the DEFAMATION ZONE says:

      You sure can! And that’s the beauty of it. Inflation is a tool (deflation is too, but not a very useful one), and it’s going to happen anyway, because people are always trying to get a little bit more of a cut.

      So your options are to have inflation in your economy, but no monetary tools to fight it besides mandating banks charge more interest (which is far stronger governmental intervention than changing the Fed rate), OR have inflation in your economy that you have some control over.

      And, of course, the price of gold does not have a mathematical relationship with the strength of the dollar alone. Yes, the general trends match up, but the dollar has not weakened 75% over the past decade.

      In conclusion, you’ll see inflation and fluctuation of the dollar’s strength, both of which will be dependent on external factors, and you will have removed the least disruptive way to combat negative events. But hey, there’ll be a little chunk of metal in a safe somewhere that represents your saving account, which is relevant, right?

      • kujospam says:

        Taxing is another tool that the government will never give up. I’m not saying I’m for it or against it. But if you tax the crap out of the top 15% You can take out a huge chunk of the money supply. At the same time paying off the national debt. This would make the dollar increase in values in two ways.

    • yaos says:

      Everybody that says we need to go back to the gold standard realizes there is a finite amount of gold and gold has more uses than being shiny, right? What happens if we need more gold than exists? What if suddenly gold loses all of it’s value?

      • eyesack is the boss of the DEFAMATION ZONE says:

        That’s another good point that nobody mentions – yes, gold has been used forever as jewelry, but it’s only with the explosion of electronics and more sophisticated engineering that we’re using gold as an ingredient to something bigger. If we need to sock away gold to make our money mean something, that hobbles us when we want to use gold for, you know, actual things.

    • The Waffle says:

      If I’m not mistaken back in the day it wasn’t that people carried Gold around, it was that the currency was backed by Gold. Thus Ron Paul’s viewpoint is asinine. You would still have a piece of paper, signifying you have the money. It’s a Gold Backed Standard. Carrying around Gold is just idiotic.

      • Bill610 says:

        He’s talking about the gold standard, and specifically states that one wouldn’t have to carry metal around. It’s right there in the video. The Consumerist article distorts what he’s saying.

      • Darren W. says:

        Really, he isn’t suggesting carrying around metal. Gold backed currency helps reduce inflation by the government. Why is this important? Politicians lose votes if they raise taxes. But they can cause inflation, which effectively makes the peoples’ salaries less valuable. This is much more abstract than taxing people directly, so there’s no loss in votes, the governments gets to spend us deeper into debt, and the people are none the wiser. Ron Paul’s suggestion would force the government to be more honest with how they are taking buying power from each of us.

    • Johnny Rotten says:

      Using actual metal based currency is always problematic – when it was done, there were constant problems with fake currency. For example:

      [1] how do I tell this gold coin is real, or mixed with a base metal
      [2] How much of the original value is left (people would routinely skim bits of the coin off)
      [3] You have to keep other denominations of the metal available to “make change”

      It’s just a really dumb idea. Gold backed currencies on the other hand are a great idea, if you have enough gold. There is one problem: No one does.

      • cloudedknife says:

        At this point, trying to tie the existing money pool to gold would be impossible; sure.

        why would a gold backed currency not work today though? It would drastically change what we pay for certain things, I’m sure, but other than that, why wouldn’t gold backed paper money work?

        • stevejust says:

          There’s a lot of gold floating around in outerspace. Who does it belong to? What if Russia or China gets there before we do to mine it? And why should value be dependent on mining ore?

          Gold is almost intrinsically worthless. Platinum and Palladium have more practical uses and should therefore, by definition, be more valuable.

          When they were having the discussion, I thought, what if the piece of paper has a drawing by a famous artist on it? What if it’s a signature of a famous athlete?

          Money is only worth something because people agree it is. Gold or silver is no different than that, either, except for the longer history of being used to store value.

          • SolidSquid says:

            I thought platinum already *was* more valuable than gold? Also, gold is used a lot in electronics due to it’s low impedance and resistance to corrosion

      • nutbastard says:

        Using paper based currency is always problematic – when it was done, there were constant problems with fake currency. For example:

        [1] how do I tell this dollar bill is real, or counterfeited
        [2] How much of the original value is left (the government would routinely devalue it by printing more)
        [3] You have to keep other denominations of the bills available to “make change”

        It’s just a really dumb idea.

        • Johnny Rotten says:

          [1] how do I tell this dollar bill is real, or counterfeited.

          Paper money can be embedded with a large number of anti-counterfeit measures that cannot be easily (or at all) separated. Not possible with metal.
          [2] How much of the original value is left (the government would routinely devalue it by printing more).

          No one is physically chopping bits off the paper bills and making it worth less when redeemed. A $100 is a $100 bill regardless of chips. a $100 gold piece is not.

          [3] You have to keep other denominations of the bills available to “make change”. Bills are small, easily stored, and weigh next to nothing. Now try keeping around $5,000 is metal currency and manipulate it.

          It’s just a really dumb idea. Yep, it is.

      • Darren W. says:

        Clearly you’re right, but Ron Paul wasn’t suggesting that we actually carry around precious metals. He is suggesting that we use a currency that’s backed by Gold, or something similar, so that the government/Federal Reserve can’t just print off more when they want to spend it, thereby deflating the value of the cash we have in our pockets, savings accounts, and paychecks.

  2. Mr. Fix-It says: "Canadian Bacon is best bacon!" says:

    No Comedy Central; videos are NOT, in fact, available in Canada at thecomedynetwork.ca

    :I

  3. Beeker26 says:

    Batshit crazy is as batshit crazy does.

    • Loias supports harsher punishments against corporations says:

      What part of the idea is batshit crazy? It was once the U.S.’s policy to have a gold equivalent for every penny it minted.

      • Doncosmic says:

        And the currency was no more stable then than it is now.

        • Loias supports harsher punishments against corporations says:

          [citation needed]

        • DoctorMD says:

          Gold Standard = short term10-20% fluctuations and stable over long term vs. Fed and Dropping Gold Standard = down over 97%. Looks just as stable to me

        • ipsedixit says:

          US currency had to be backed by gold because people didn’t believe in the value of US currency. They did believe in the value of gold. But the belief in the value of gold was no more rational than the current belief in US currency.

          The gold standard was merely a method for the dollar to gain legitimacy. But there’s nothing more or less inherently valuable as a currency about gold over paper money. They’re both given value because other people accept them as valuable. It’s merely a way to store value.

    • mbgrabbe says:

      Batshit crazy is having a monetary system based on worthless pieces of paper. Gold actually has a value associated with it.

      • alSeen says:

        Gold has no more value in and of itself than paper bills do.

        Going back onto the gold standard would be pointless.

        “Money” would still be created by banks when they loan money out,, unless the feds decide to raise the reserve ratio to 100%

        • c!tizen says:

          It’s easy to print more money, the Fed does it every day. You can’t just “make” more gold. It’s value is in its limited quantity.

          • SBR249 says:

            Hypothetically speaking, that “limited quantity” characteristic of gold can possibly make the housing market implode overnight if the gold standard is adopted.

            For example, a nation’s economy will generally grow over time, usually at a pace that is much greater than the increase in the amount of gold in the said nation’s reserves. Therefore, over time, less gold will be used per unit of economic transaction because a nation’s gold supply must cover all of its economic transactions. That leads to deflation as the value of assets fall. So imagine, if you will, that you know the value of your house will certainly fall over the period of a standard 15 or 30 year mortgage. Would you then buy a house? The same thing will happen, to a lesser degree, to all goods. Therefore saving money would be the most prudent store of value for individuals, leading to less and less consumption, something reminiscent of a deflationary spiral. Japan is actually a good example of that.

            • c!tizen says:

              well see, this is why I’m not an economist.

              • AnthonyC says:

                That’s fine, not everyone needs to be an economist, but the Chairman of the House Financial Services Subcommittee on Domestic Monetary Policy should know better, or at least know to ask someone who does.
                I’m not an economist either.

            • Loias supports harsher punishments against corporations says:

              It’s sad that less consumption will cripple our world, right? Shouldn’t be aiming towards a lower-consumption society?

              What’s the answer? A resource-based society. Goods are distributed as needed, no money is needed. See: http://www.thevenusproject.com/

              • SBR249 says:

                My intent isn’t to say that all decreases in consumption is bad, the flagrant debt-fueled consumption that precipitated the current economic downturn is indeed both unsustainable and unreasonable.

                However, a sustained and long-term deflation is just as bad as high inflation. One can imagine that the more people saved, the more companies cut back on production and cut costs. That leads to higher unemployment and even more savings and a vicious cycle is born. To a certain extent, consumption is a significant part of what drives the economy and innovation in this country. The key is to find the right balance, not to eliminate it altogether.

          • jessjj347 says:

            The U.S. can only keep printing more as long as the dollar stays the world reserve currency. Several world leading countries have already met to try to change this…

        • Necoras says:

          Gold is quite valuable intrinsically. It’s pretty and doesn’t corrode, and as such makes for good ornamentation (jewelry, paints, etc.). It makes for a decent set of false teeth. It’s a very conductive metal and is used in electronics. It is occasionally used in medicine. These uses may not justify a $1000+ an ounce price point, but it is quite valuable.

          • alSeen says:

            I knew I should have included “except for industrial purposes.” In fact I had it in my comment at one point, but removed it while I was editing it.

            Yes, gold does have some use other than being pretty.

        • Preyfar says:

          Indeed. The entire value of gold is based on the mere belief it’s valuable. People see shiny metal, think it’s worth something, so therefor it must be, right? But it’s just a metal mined out of a rock. Sure, it’s somewhat rare, but it’s only valuable because people /think/ it is. If people stopped believing gold was worth something the entire economy would crumble.

          Granted, the entire idea of “money” having value was that it was supposed to represent a trade in services and labour. Gold is shiny, but if we all start believing a $1 gold coin is worth $10, does it make the value of gold any more valuable?

          • poco says:

            Yes, it does. The whole idea of currency is based on a collective acceptance of it’s value. If we think gold is valuable, than it is. If we think bills and coins are valuable, than they are. If we think bottle caps and string are valuable, than they would work too.

        • madmallard says:

          Its not banks unilaterally making money. The ‘new money’ comes from you taking on debt in an agreement with them

          that act is a 2 party action.

          When the government prints more money, no other party is involved in circulating that action.

      • crashfrog says:

        They’re not worthless. They’re worth 1, 5, 10, 20, 50, and 100 dollars.

      • PsiCop says:

        Monetary value is not “based on” paper — or gold — or on anything else. It’s “based on” “demand.” There is nothing inherent about “gold” — or any other commodity — that grants it any “value.”

        That may sound incredible, but stay with me here. Ron Paul keeps caterwauling about the “value” of gold, but gold only has “value” in the first place, because there’s demand for it.

        In other words, the “value” that gold has, is NOT because it is gold. It’s because people want gold. Operative word there being the verb “to want.” It’s not that “things have value,” it’s that “people want things,” therefore “the things they want, have value.”

        So long as people want all that paper that Ron Paul hates, it will have value … because it’s people’s desire for it, that grants it value.

  4. McRib wants to know if you've been saved by the Holy Clown says:

    Q: What’s the difference between a politician and a deranged lunatic?

    A: One can be locked up for the safety of those around them.

    • c!tizen says:

      “deranged lunatic”?

      Not being able to create money out of thin air… the lunacy!

      • McRib wants to know if you've been saved by the Holy Clown says:

        Actually, yes, not being able to control the supply of money is in fact lunacy.

        Or do you like deflation?

        • c!tizen says:

          No, I don’t enjoy deflation. I rank it right up there with inflation.

        • SalParadise says:

          Deflation is very bad for people in debt. It makes you pay back your loans with more expensive dollars.

          Inflation, on the other hand, is very good for people in debt, and for the same reason: you get to pay back your debt with cheaper dollars.

          Now, guess which one of your uncles is up to his eyeballs in debt? That makes the prospects for deflation just about nil.

      • stevejust says:

        Not using a metal dug up from the ground as a store of value… yeah, that’s insane.

    • Loias supports harsher punishments against corporations says:

      A) One is given or voted into a position of authority

      fixed that for you.

  5. Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

    It sure would help to curb government designed and encouraged inflation.

    I want to implement the canned peaches standard: When the world goes to hell in a bucket, I will trade you one of my cans of peaches for 2 of your shiny gold ingots.

  6. Rube Goldberg says:

    “This wouldn’t be disturbing except for the fact that Ron Paul is the new Chairman of the House Financial Services Subcommittee on Domestic Monetary Policy.”

    It’s still not that disturbing.

    • skylar.sutton says:

      I agree, and I’m rather pissed off at Consumerist for posting an editorial about economic theories without any apparent knowledge on economics.

      It’s really not that crazy, and no one is going to “pay for the beer with gold nuggets”. The value of gold and silver is more stable than paper currency. Large international companies might negotiate with each other in “pounds of gold” instead of local currencies… that takes some of the headaches out of currency volatility and hopefully reduces costs. The problem is, that is illegal under current US Law… which Ron hopes to change.

      Consumerist editors: Please please do not post anything about economics in the future… you proved you can’t handle it.

      • Ebriosa says:

        Seriously. They take getting rid of the penny with an even handed if whimsical approach, why not this? I don’t agree with Ron Paul, but neither do I agree that Austrian economic theory is discredited. I don’t believe I’ve ever seen Havek or von Mises mentioned on this site and suddenly they’re declaring the whole school defunct?

  7. mbgrabbe says:

    Go Ron Paul!

  8. moore850 says:

    The only reason this makes sense is that gold is actually pretty hard to get out of the ground, whereas money can be printed for basically no effort. The thinking is that because gold requires some effort, people will not just be able to “make” more so easily, forcing a bit more thought into how to get the money to do things.

  9. Skeetz says:

    Every vendor in the country would have to invest in machines to detect fake gold. Really, it can’t be that hard to make molds to stamp ingots..

    • Distahs says:

      A lot of the men in my city would know how to, using sand casting taught in high school.

      • aikimann says:

        Do you seriously think Ron Paul is advocating carrying ACTUAL gold around in our pockets, instead of paper currency that can be exchanged for gold? Nothing would change with the way transactions are currently run today.

        • The Waffle says:

          Actually that’s what Ron Paul seems to want, rather than even carry Cash. Granted it’s going to be significantly harder for theft based off the amount carried, but it’s much more difficult to track/trace.

          • Loias supports harsher punishments against corporations says:

            Based on the other comment, you didn’t listen to the video. He is not suggesting you carry gold.

  10. infected says:

    Ben, it’s taking me every shred of willpower to not tell you exactly how fucking retarded you are for posting this preposterous article.

    Oh wait, I just did tell you.

    Please, try to do a little research and get educated before you post something so ridiculous that advocates riding the Keynesian bandwagon right into bankruptcy.

    • Loias supports harsher punishments against corporations says:

      Exactly how is Consumerist out of line for posting an interview on a well-known news program with the new Chairman of the House Financial Services Subcommittee on Domestic Monetary Policy?

      Hey, if I got trolled sue me, but the only thing “fucking retarded” here is you.

      • c!tizen says:

        I think he was referring to the condescending undertone of Ben’s article, not the actual interview itself.

      • infected says:

        I guess you didn’t read his oh-so-bright commentary? I’m not even talking about the video interview.

        >>>Ron Paul, career-long proponent of outmoded and discredited Austrian economic theory, went on Colbert last night to talk about how paper money sucks and he wants you you to be able to go into a store and buy a six-pack with some gold ingots. His proof? Paper money can rot and people have believed in the value of gold for centuries. So, gold is “better” because the collective hallucination around it is stronger. This wouldn’t be disturbing except for the fact that Ron Paul is the new Chairman of the House Financial Services Subcommittee on Domestic Monetary Policy. Yeeeeeks.

        “Discredited” Austrian economic theory. Roflmao. wow.

        • Loias supports harsher punishments against corporations says:

          Clearly you don’t read this blog much. Sarcasm and humor are Consumerists’ bread and butter.

          Slow your roll.

          • infected says:

            I have a full grasp of how this works, been reading for many-o-year. That won’t stop me from pointing out stupid shit, like Ben’s commentary and your 1st reply to me. Good day.

            • Loias supports harsher punishments against corporations says:

              Unfortunately, had you written your original comment in polite manner rather than derogatory and profanity-driven, people might have actually listend, or cared, about what you had to say.

      • not-gonna-tell-ya says:

        I don’t think it was the posting of the interview, but the highly biased commentary regarding his comments. What Paul is saying is that we should be back on the gold standard, not the paper standard. No one is advocating buying smokes with a nugget. Just that paper has no underlying value than the promise of the Fed. Which by the way is quickly becoming meaningless. Gold has value due to its rarity

    • HappyPig says:

      Language, you foul-mouth troll.

      To encourage spending, we should go on a uranium standard, since this fixation on one particular element is retarded. That way, no one would want to save their money, as they’d get a decent amount of radiation. So a uranium standard would be a good stimulus to the economy!

  11. The Moar You Know says:

    Rn Pl s n dt. nd s s nyn wh gvs hs dlsnl th cntr ds vn mnt wrth f crdnc.

    • Loias supports harsher punishments against corporations says:

      The gold standard wasn’t used in the U.S. offcially until the 20th century.

      Learn your history?

      • Mom says:

        And it was dropped in 1933, because of, the fact that it was a contributing factor to the bank panic in the early part of the depression.

    • Limewater says:

      Consumerist obviously agrees with you. Thanks, Ben, for this objective, consumer-focused reporting!

    • c!tizen says:

      Well that was super informative, well written, obviously thought out and carefully worded. Thanks for taking the time to explain your position.

    • Maximus Pectoralis says:

      Yeah let’s throw out that stupid 18th century worthless piece of paper called the Constitution and adopt the much more modern Soviet model! It’s working great for Cuba and North Korea. Unfortunately China has already abandoned it for the most part and is probably on the verge of economic collapse..

      • MrEvil says:

        Wherein does the constitution say that the money has to be backed by gold and silver?

        Article 1 section 8 of the US constitution states that congress has the authority to coin money and regulate its value as well as the value relative to foreign currency. It does not specify what the money is to be made out of or what metric they use to determine the value. The only other mention of money in the constitution pertains to counterfeiting and the prohibition of the individual states from introducing their paper currency and coin unless it’s minted from silver and/or gold (but it does NOT place the silver or gold requirement on the federal government).

        The presence of paper money in the US comes more from practicality than anything. I don’t know of anyone wanting to cart around substantial amounts of coin everywhere… I know the Strippers don’t like it when you throw coins at them.

        • Limewater says:

          I don’t think he was saying that the constitution prescribed the gold standard. I read it as just making reference to the U.S. Constitution as being an 18th-century idea.

        • nutbastard says:

          You’re asking the wrong question.

          Where in the Constitution is the Federal Government authorized to delegate monetary production and control to a private bank?

          The Constitution spells out what the government may do – anything not expressly authorized – isn’t.

    • tjustman says:

      Anyone who uses ad hominem arguments by calling people idiots if they disagree with them, are the true idiots.

  12. Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

    Why, whenever someone starts making sense, are they automatically declared a loony toon?

    Stop making sense, people.

    • Maximus Pectoralis says:

      Because that’s how “liberals” work — attack the man, not the idea.

      • sufreak says:

        Its not a liberal thing. That’s quite the ignorant statement. Especially since Fox News does it on a minute by minute basis.

        Frankly, I’m a liberal (at least socially) and I’m a big Ron Paul supporter. He’s made the most sense of any of the candidates in the last election.

        • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

          In a field of idiots, It’s not that hard to shine.

        • Ahardy55 says:

          How are you a liberal and a Ron Paul supporter? You may agree on the War in Iraq, but most liberals and Ron Paul have extremely different views on how to solve problems. If you think Ron Paul’s solutions are they way to go, that probably means you’re way closer to being a libertarian.

      • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

        I consider myself to be somewhat … a bit left of center. I don’t attack anyone with a good, or even different, idea, New or old.

        The only thing dumber than a Democrat or a Republican is when those pricks work together. You see, in our two-party system, the Democrats are the party of no ideas and the Republicans are the party of bad ideas. It usually goes something like this. A Republican will stand up in Congress and say, “I’ve got a really bad idea.” And a Democrat will immediately jump to his feet and declare, “And I can make it shittier.~ Lewis black

      • Kryndar says:

        Okay, so liberals work with ad hominem, does that mean conservatives work with sweeping generalizations?

      • nutbastard says:

        no, how the media works is in convincing you that republicans and democrats are different from each other in any way that actually matters. they aren’t.

    • Ahardy55 says:

      Oh, I’ll attack the idea. The idea is sheer idiocy.
      1). Gold has no actual value, not really. It has value because we all decide it does…like money
      2). The gold standard did nothing to control inflation. http://www.usinflationcalculator.com/inflation/historical-inflation-rates/

      Yes, there are problems with the Fed, blah blah, we all know this. The solution isn’t to suddenly have everyone carrying around a sack of gold nuggets. This is my problem with Ron Paul and most libertarians: they’re good at recognizing the problem then come up with the most comically absurd solution you could possibly dream of.

      • aikimann says:

        So there’s no difference between the gold standard and our current paper standard?

        Have a look at the value of the dollar since 1954.
        http://upload.wikimedia.org/wikipedia/en/d/d7/Value_of_US_dollar.gif

        Care to guess what caused the precipitous drop in value circa 1968? Ya, that would be us going off the gold standard

        • Tiercelet says:

          Your graph shows a sharp adjustment around then, and then pretty stable prices at another rate.

          So . . . you’re saying that the gold standard is flawed, because the government can set the dollar price of gold wrong? This does not strengthen your case.

      • ralphthemagician says:

        Gold actually *does* have some inherent value. Gold, silver and platinum aren’t valuable “just because we say they are” the way other fiat currencies are.

        To understand this, look at the periodic table. They are all pretty close to each other. Coincidence? Nope. Gold is a stable element. It’s abundant, but not do abundant. It can be smelted easily. It doesn’t corrode, it doesn’t rust, and it doesn’t decay. None of these things are true of paper currencies.

        If you “re-rolled” civilization a thousand times you’d always end up with the precious metals being the valuable ones because of their properties and the amounts they exist in.

  13. dkreichen1968 says:

    Let’s see, right now we have a totally valueless inflationary currency and trillions in foreign debt, and you think that Ron Paul and the gold standard are disturbing? What exactly have you been smoking?

    • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

      Smoking? That’s it! The NEW “Gold” standard! Sweet…

    • Jean-Baptiste Emanuel Zorg says:

      “totally valueless”? That’s about the stupidest thing posted in this discussion thread, and that’s saying a lot. If you really believe it is “totally valueless”, I’ll be glad to take it off your hands for you – I know some people who will be happy to trade food, gasoline, clothes, real estate, and pretty much any other service or merchandise you can name for some of that worthless stuff

      • jessjj347 says:

        You should go do some research about inflation. There’s a very good chance the dollar will become worthless this year.

        Keywords: world reserve currency, dept ceiling, inflation, etc.

        • Tiercelet says:

          Okay, put your worthless paper where your mouth is.

          Pay me $1000 and I’ll sell you a futures contract allowing you to buy a full gross of cans of beans at $1000 per can, redeemable on 12/31/11. After all, $144,000 will be nothing by then, right?

          Of course, the up-front payment is to compensate me in case you actually decide by the end of the year not to take me up on my foolhardily-generous offer.

    • crashfrog says:

      Real quick – exactly how much inflation do you think has occurred in the last 5 years? Be specific.

      Then go look it up. I think you’ll be surprised.

      • David in Brasil says:

        Well, here in Brasil, it’s about 6 – 8% per year. Why do you ask?

        And, no, Brasil is not on a gold standard. Maybe it should be.

      • evnmorlo says:

        Real estate, gold, wheat, oil all went up 100+%. College and health-care went up at least 50%.

      • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

        Are you referring to the “official” US government fantasy figures, or real inflation?

        • crashfrog says:

          Oh, I see. Goldbugs think there’s some kind of secret inflation going on that somehow, isn’t actually reflected in things like the CPI.

          More than 1.5 trillion dollars disappeared from the US economy – vanished into thin air! – at the end of the housing bubble, but god forbid we print any new dollars to replace it, that might cause inflation!

          Never mind, of course, that in a recession, inflation is precisely what you want…

    • Putaro says:

      Trillions in debt payable in a soft currency. Think about how screwed we’d be if we owed everyone in gold.

  14. Maximus Pectoralis says:

    You know what’s even more insane? Obama’s “New Era of Responsibility” budget policy. Apparently “responsibility” is $1 trillion/year deficits for the forseeable future!

    Also since when has Austrian economic theory been completely discredited? Keynesian policies sure seem to be doing great for all of the European social democracies! Just look at Ireland, Greece, Spain etc.!

    • PsychicPsycho says:

      Good thing Repubs didn’t just cry and whine until we added $700 billion in tax cuts!

      • hypnotik_jello says:

        Hey now, supply-side economics FTW

      • Maximus Pectoralis says:

        I love how if it’s not a tax increase, it’s a tax cut. Here in NJ, the Democrats tried to pass a huge new addition to income taxes, particularly targeting weatlhy individuals (who have been fleeing NJ in droves in recent years). When the Republican governor decided to veto the bill, he was “cutting taxes for the rich”.

        NJ is sort of a different situation since while NJ has extremely high taxes by national standards, the US has fairly low taxes by international standards. So it’s not like people are going to start fleeing to UK and France for tax shelters. Unfortuntaely I think we are going to end up resorting to a combination of deep spending cuts and tax increases if we are ever going to balance the budget. I think if they are going to make a “millionaire’s tax” though, they should actually make it on incomes over $1 million, not $250k. In some places $250k is barely enough to own a home…

        • Tiercelet says:

          In some places $250k is barely enough to own a home…
          This tells you much more about the out-of-touch housing market and overall trends toward urbanization and concentration of the job market than it does about income levels.

        • chargernj says:

          Wealthy fleeing NJ in droves? Ridiculous assertion, where are they going? Do you have actual figures to back that up? We’ve actually increased our population by about 400,000 since the year 2000. I think it is more likely that we have less wealthy people because they loss their jobs or took pay cuts under this wonderful economy that Bush left us with. But in the end, most of those same people who used to be considered wealthy are still living here.

    • ARP says:

      Tell me about Bush’s budget and deficit history. Tell me about Reagan’s budget and deficit history

      PS- and before you start, Obama has not added more than Bush in his 8 years. That’s a Fox News lie that’s become true through repitition

  15. SunnyLea says:

    It’s valuable because it’s SHINY! Shiny is inherently valuable.

    Though I like shells, myself.

    • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

      Not as valuable as SPARKLY.
      ~ like diamonds.

      But that gets into the whole DeBeers “hoard the diamonds and make women think they are rare and valuable and men should buy them for you” conspiracy.

  16. Applekid ┬──┬ ノ( ゜-゜ノ) says:

    Considering the rising cost of goods, the lack of paper money raises to keep up, I think I’m going to ask my employer for my pay in gold.

    And by asking put myself on the top of the “troublemakers we need to fire soon” list.

  17. Consumeristing says:

    bm FCK YH! LV BM! LV THT H VTD FR TRP, CRPRT BLTS, ND WGNG TW WRS!! YH! Y, ‘m nt fn f Rn Pl, bt btch pls fr cllng hm ‘dstrbng’.

    • Loias supports harsher punishments against corporations says:

      It’s like he trying to talk to me, I just know it!

    • Awesome McAwesomeness says:

      If I remember correctly, Bush voted for the first round of the bailouts. Obama kept them going so as not to cripple our country’s economy. Do you have a better plan???

  18. Me - now with more humidity says:

    I’m gonna need a bigger wallet.

    And how about change? Should I just scrape off some gold shavings — “93, 94, one ingot. Have a nice day!”

    And how am I gonna shove gold through the Internetz tubez to pay for my Amazon books?

  19. AGunn says:

    “outmoded and discredited Austrian economic theory”

    Citation please.

    • Loias supports harsher punishments against corporations says:

      I believe Ron Paul is the citation in this case. It’s an opinion of a monetary expert.

      • infected says:

        Again, proving you have no fucking idea what you’re saying and just need to go away.. Ron Paul supports the Austrian School/theory.

        • Loias supports harsher punishments against corporations says:

          And again, no one cares what you have to say when it’s just insults and profanities.

      • Doncosmic says:

        How exactly is a medical doctor in any way a monetary expert?

        • Abradax says:

          How exactly is a community organizer qualified to be commander in chief of the US army?

          • c!tizen says:

            how exactly do they get all that cheese into cheese its?

          • Loias supports harsher punishments against corporations says:

            Especially when he’s not even a U.S. citizen. Jeeze!

          • ZekeDMS says:

            Good question. For that matter, how to yale flunkies and actors get that job? They don’t know anything about getting large amounts of people to work together either!

        • Awesome McAwesomeness says:

          Maybe he has studied a great deal about it. I have a degree in literature, yet I am far more educated when it comes to history because later in life I became more passionate about it. If he’s read enough about it and studied it enough, he may very well have some expertise in the area. I am not a fan of Ron Paul AT ALL. But, being an M.D. doesn’t mean he can’t have expertise in another field.

          • Awesome McAwesomeness says:

            I just Googled him and economics has indeed been a deep interest of his since the 1960’s. If he has been reading about it and studying about it since then, no doubt he’s got some expertise.

    • tjustman says:

      Based on these comments, the only citation needed is including the word “idiot” when referring to something you don’t like or agree with. Because the last thing a truly ignorant person wants to be called is an idiot. Done and done!

      BTW I invested less than a year ago in non-US currency investments (Euro Pacific Capital)…I’m up 50% in less than a year. But I’m the idiot…oh yeah…

      • Maximus Pectoralis says:

        For those who don’t know, Euro Pacific Capital is an investment company run by Austrian-theory economist Peter Schiff. Search for his name on YouTube, you will see some hilarious videos from around 2006 saying that the big banks were going to collapse and all of the mainstream economists laughing at him.

        • youbastid says:

          Well I haven’t seen the vids, but I’m guessing they were laughing at him because the big banks didn’t collapse. The small/middling ones did, and the big banks made out like bandits.

      • nutbastard says:

        i invested in plain old silver last year – i’m up 110%

    • nova3930 says:

      There is no because its an absolute falsehood. They just don’t like the theory because it tells them their interventions are worthless at best, and harmful at worst….

      Yet they’ll gush over Keynesians as the second coming when even Keynes disavowed his theories prior to his death…

  20. tjustman says:

    Funny how people laugh at the notion of money based on gold. Like money based on how much the government runs the printing press is not completely laughable. I can name nations devastated by inflation due to fiat currency. Can any of these laughers name a country destroyed by a gold-based currency?

    • Cameraman says:

      Well, there’s Croesus of Lydia, and… no, that’s all.

    • exconsumer says:

      Not especially, but I also can’t name a country devastated by a Monkey Poop monetary standard. Every major economic power uses a fiat currency. Hard money does not work.

    • Tiercelet says:

      Yes. The United States, France, and Great Britain, in the late 1920s-early 1930s.

      There are good reasons we haven’t used a gold standard in decades, and most of them have nothing to do with the Ebul Gummint wanting to rack up debts and then inflate them all away. Currency pegs to any kind of fixed commodity limit economic growth. We usually like economic growth. Therefore currency pegs are bad.

      If you want to be concerned about something, worry about the ratio of debt to GDP (i.e. how much the US owes compared to the size of the economy). See [1]. But even there, don’t worry about that all the time; that ratio spike at the end is primarily driven by the GDP collapse we’ve had since 2008, which would’ve been greatly mitigated if Keynesian economics were actually tried. [2]

      [1] http://en.wikipedia.org/wiki/File:USDebt.png
      [2] Hint: It wasn’t. State and local government spending fell so much that the paltry federal spending outlay — which was substantially in non-stimulative tax cuts for rich people anyway — barely offset them. See http://www.nytimes.com/2010/12/20/opinion/20krugman.html and others. Or just go rant on the Internet, it probably doesn’t matter anyway.

  21. Cameraman says:

    HINT: It’s inflation. He’s worried about inflation. It’s really, really hard to cause inflation if your currency is backed with a tangible object, but fiat currency is vulnerable to the meddling of idiot politicians.

    Ron Paul is totally crazy, of course, but that doesn’t mean he’s wrong. In this particular instance.

    • Doncosmic says:

      Clearly you have never seen Goldfinger, or you would understand the risk this exposes the entire world to.

    • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

      ­­­­­­Crazy ­­­≠ Stupid.

      • jessjj347 says:

        They don’t just give away MDs like they do honorary degrees…
        Zing to everyone calling Ron Paul stupid.

  22. Mecharine says:

    Gold is heavily speculated on. Imagine what would happen when a gold commodity bubble bursts. Now consider what would happen to money based on gold.

    • Bsamm09 says:

      And currencies are not heavily speculated on?

    • exconsumer says:

      +1000

      And yes, currencies are speculated upon . . . but they are fiat currencies. When speculation drives the value up or down, the Fed can mitigate the change by buying or selling Treasury securities (which essentially prints money) based on our economic needs.

  23. umbriago says:

    I’m more of a Silverite myself (citation useless).

  24. Coupon says:

    I don’t see the problem with switch from Monopoly money to real money. Where’s the inflation worry with using real money? Thank you.

  25. ahow628 says:

    Consumerist rails against gift cards issued by competitive, prospering businesses. Yet they are fully on board with a piece of paper issued by a broke government? The irony is palpable.

    • Maximus Pectoralis says:

      That’s because gift cards are made by evil profit-driven mega-corporations while Ben Bernanke’s Helicopter Printing Presses are run by our all-knowing charismatic leaders of the Republik!

    • coren says:

      Does cash expire and have fees now?

      • ahow628 says:

        First of all, cash loses about 3% of it’s value per year due to inflation. That number may rise in the near future.

        Second, your cash will expire when the US debt holders decide not to lend the US any more money. Good luck with that.

  26. El Soze says:

    A silly writeup over a silly interview.
    They hardly talked about anything at all. The only subject brought up and hardly discussed was inflation.

    This is quite useless overall as far as information is concerned. But after reading the summary, information was obviously not a concern.

  27. zombieite says:

    This blurb was pretty lame. A bunch of insults without any explanation of why paper money is so good. I have doubts that gold would solve all of our problems, but I suspect it might fix a few. I seriously doubt that paper money fixed any of our problems, and I suspect it created some. I don’t think this is a black-and-white “Ron Paul is crazy” issue.

  28. LTS! says:

    Everything we do is based on subjective value. Whether we use paper backed by nothing, paper backed by gold, actual gold, or troglodytes. It’s all based upon the value of an object or service to one person relative to the value of giving up the object or performing the service from another.

    Every idea is subjected to the whims of an individual if it’s based upon subjectivity. This means that no one notion discussed in the comments is any more bat shit crazy than another.

    But you know what? Since this is Consumerist and not Philosophist or Economist I can’t see why this would even matter here. Nice post.. slow news day?

  29. diasdiem says:

    How the hell would you buy a six-pack with gold anyway? Who the hell knows what about $8 worth of gold looks like? It’s almost $1400 an ounce right now. Would just hold out your gold brick to the cashier and let them scratch it with a fingernail?

  30. Keter says:

    I thought Consumerist / Consumer Reports was supposed to work from facts, not media hype when compiling its reports. Austrian economics is not discredited at all, it’s just not popular with the Powers That Pretend who have gotten rich off the ability to manipulate Keynesian economics and use it to consolidate power. Austrian economics has been smeared by the very people who fear its ability to unmask their dirty dealings. Keynesian economics has discredited itself through practical application – it’s what got us into this mess.

    I would like to see us return to a monetary system based on a limited commodity because it will prevent the insane practice of the Federal Reserve just making money out of thin air, and that will prevent other abusive practices such as fractional reserve, which further inflates the money supply. I advocate gold for only one reason: I suspect that the United States government has been using gold to finance things it should not have been doing, and is now almost out of gold. I want to see what happens when they have to reveal our real gold holdings and if it’s less than it should be, start proper investigations into what’s happened – Bernie Madoff is a small fish compared to the fraud that will surface.

    Ron Paul is not crazy, he just has different ideas from the mainstream media and which run counter to corporate special interests, and their response has been to use the media to attempt to discredit him. This is why I distrust mainstream media and follow blogs like Consumerist, instead, as I value truth in reporting. My advice to the Ron Paul haters is to try listening to Paul’s actual words and actually think for yourself about them rather than just swallowing what the biased media has to say about him.

    This blatantly biased article sent up a huge red flag for me, Consumerist. I’m long time reader, commenter, and contributor, and have frequently recommended your blog, but now I have my eye on you and will be telling others to watch out for bias as well.

    • Bsamm09 says:

      I am not a fan of Keynesian economics or the Austrian, although Mises and hayek were a lot easier to read than Keynes. I prefer the Chicago school and Monetarism. Milton Friedman FTW!!!

    • jessjj347 says:

      Ron Paul doesn’t need to succumb to corporate bribes because he’s a practicing MD. If you have money, there’s no need to sell yourself out to the ideas and lies of others.

    • exconsumer says:

      I’ve never understood the whole ‘inflation leads to a consolidation of power’ thing. It’s nonsense.

      By inflating the currency, the Fed guarantees that those with a lot of it must reinvest into the American economy in order to maintain their wealth. They have to build businesses, offer services, and hire workers. In order for them to stay rich, they must make others rich. On the other hand, a deflationary currency would guarantee that the super rich never had to do anything at all: Their wealth would increase regardless of their participation. The poor and middle class would never get access to any loan with which to compete with large cashholders economically. If your goal is rule by wealth, deflation is the way to do it.

  31. Narmical says:

    Those of you who disagree with Ron Paul clearly don’t understand what money is or the current situation the US is in.

    A money is a medium of exchange. In other words, something more trade-able than the thing you traded it for. Its not because people think think value into something that makes it money. its that people are more willing to trade for it than other things that makes it useful as money.

    In reality the perceived uselessness of a thing makes it better at being money. Do any of us really want green pieces of paper with dead men’s faces on it? no! and thats what makes it great. we are willing to give it away to get the things we need.

    Also an error some commenter have committed was saying “lots of people take dollars for stuff”. There is a law in effect that forces US citizens to use the dollars.

    • exconsumer says:

      No, I only have to use currency to pay the government taxes and I must accept it as a payment of debt someone owes me, barring a previous agreement. Aside from that, I can barter for everything I need. There is no law forcing me to do my business in US Currency.

    • SBR249 says:

      Actually I don’t think dollars are dollars because someone somewhere is willing to give me 2 chickens for 5 of them. Dollars are currency because it’s backed by the full faith and credit of the US government. People are willing to use it because they know that it’s backed by an entity that has (up to now) been able to pay its debts plus interest.

  32. chucklebuck says:

    Please don’t take this as a troll, I’m honestly curious – what happens to all the paper currency in circulation in excess of the value of the gold on hand if we go to the gold standard? If the answer is that it gets removed from circulation, how is it decided whose paper money gets taken away?

  33. AgostoBehemoth says:

    Ben,

    Posting this type of insipid drivil, and showing your own polictal leanings sickens me.

    Perhaps you would care to enlighten me with your own economic theory? I’ll tell you some of mine… I believe that the Federal Reserves current quantitive easing is causing commodity to rise… a commodity is something like – coffee, or perhaps oil. The actual COST of the item remains the same… but the dollar is worth less – so it takes more dollars to buy the same thing. IF – the dollar were backed by gold, or perhaps silver that wouldn’t happen.

    You see, Ben – what the government likes to do, is run up vast quantities of debt – and then devalue the currency.. because then the debt devalued as well. This sometimes works (on a macro-economic level).. but it sucks for the consumer. Why aren’t you pro-consumer?

  34. qwertyshrdlu says:

    There are three questions to answer before we can have a gold standard currency:

    1. How much gold would we need?
    2. How do we keep the gold from flowing out?
    3. What dropping all this gold on the market do to the price of gold?

    Remember, the tinniest discrepancy between the price of gold and the value of money starts huge volumes of high frequency trading as speculators try to siphon
    off profits.

  35. HeyApples says:

    One of the related posts to this articles is “congrats the U.S. is 14 trillion in the hole”

    THAT is what is disturbing.

    Ron Paul wanting a fixed, hard-asset currency that cannot be hyperinflated down to worthlessness is the exact opposite of disturbing.

  36. HeyApples says:

    One of the related posts to this articles is “congrats the U.S. is 14 trillion in the hole”

    THAT is what is disturbing.

    Ron Paul wanting a fixed, hard-asset currency that cannot be hyperinflated down to worthlessness is the exact opposite of disturbing.

  37. tsukiotoshi says:

    Man, my purse is heavy enough as it is without filling it full of gold ingots just so I can buy a sandwich at places that don’t take cards.

  38. osiris73 says:

    Not a big fan of Ron Paul, but his point is that our paper money used to be backed by gold, now it is backed by nothing tangible. He’s NOT saying that people are going to have to buy things with actual gold. Sheesh, people. Paper money used to be a like a promissory note, meaning that you could, if needed, turn that piece of paper in for something tangible such as gold or silver.

    HE’S NOT SAYING THAT WE ARE ALL GOING TO HAVE TO CARRY AROUND GOLD!
    *rolls eyes*

    • Ben Popken says:

      He says that he wants gold and silver to compete with paper money. So he wants stores to accept both paper and metal.

      • 12345678nine says:

        WHy shouldn’t they be able to? It would have to be in the form of gold coins or something like that, and not just a broken necklace, obviously. But why not?

      • osiris73 says:

        I’m having a difficult time finding where he ever says this. His stance is that he wants us to return to a gold standard where the paper money is backed by a tangible asset and not on an intangible promise that the paper has some inherent value. He wants to go back to a time like when we had a silver standard. When you took your money to a bank and handed them a $100 bill, the bank would have to hand you in return, $100 in silver at the current rate. He wants a GOLD standard for today’s money in that same way. If you can find me where he says otherwise – that he wants us to carry around actual gold coins – PLEASE let me know and I will bash him along with everyone else because that would be ridiculous and ripe with problems.

  39. Phil_McCracken says:

    Mr Paul is correct. And with all due respect to Ben Popken: You kind of missed his message.

    Do a search on YouTube for “Ron Paul predictions” and you’ll be shocked at how much of what he’s said in the past has come to fruition. There’s a big scam going on and it involves the Federal Reserve and its role in deciding which companies survive and which fail. Ever wonder why Goldman Sachs and AIG were basically the only two major survivors of the financial crisis? Look it up.

    The dude may come off as batshit crazy (and no doubt his son is) but you may want to stop and listen to his message once in a while.

  40. exconsumer says:

    Yeah, the nice thing about ‘Austrian School’ economics is that it’s so simple that just about anyone can catch on to it. Inflating a currency makes it worth less and less . . . Spending borrowed money just puts you further into the hole . . . etc. etc.

    And the bad thing is that it’s just plain wrong. Inflation is necessary to keep pace with a growing economy and a currency that’s allowed to deflate will be a drag on any growth; no one invests money if it increases in value all by itself. Also, properly investing borrowed money can and does create real wealth. Businesses invest in infrastructure with borrowed money every day. Countries . . including the United States . . do it every day. As for our worthless dollar . . . you let me know when people start dumping US Treasury Securities because they think it’s worthless.

    I hate arguing economics, because the real answers aren’t as conveniently small as those you get from people like Ron Paul. Because I can’t explain it in a few paragraphs, I look like I’m making things up. Ugh.

    • Kate says:

      Yeah, the problem with libertarians is they are completely unable to see the big picture in their head.

      • jessjj347 says:

        If you mean that you therefor cannot agree with points made by libertarians then I say to you sir or madam – Ad hominem. Try again.

    • jessjj347 says:

      So how do you feel about China undervaluing it’s currency? As a followup, what do you think will happen when our dollar becomes very inflated (e.g. many speculate U.S. will no longer be world reserve currency) ? How will we pay back our dept to China?

      • exconsumer says:

        I’d rather China not undervalue it’s currency. If a country needs to increase the rate of inflation to keep pace with or stimulate their economy, well they need to do what they need to do, and I don’t begrudge them that fact. But China appears to be undervaluing it’s currency only to remain competitive in the international markets . . . making their products cheaper than those from other countries, and making it hard for China to import. This hurts US and other exports, and is, more or less, bad form. They’ll get theirs in the end, I think. Excessive devaluation can lead to overinflation or hyperinflation. And companies performing in such a protected environment, one where imports are falsely more expensive, will slowly become less competitive. When China stops devaluing, they will find they may have done their economy a disservice.

        Your next two questions: What will we do when the dollar becomes very inflated? and How will we pay back our debt to China? display what I think is a lack of understanding on your part. The US dollar is inflates, yes. But at a moderate pace like every other currency in the world. So moderate, in fact, that people all over the world still buy US Treasury Securities (they invest in our monetary system/loan money to the US). Further, it is still one of the most sound investments one can possibly make. That’s why China buys so damn much of it. . . which is why your second question makes little sense. We’ll pay it back with future earnings and economic growth. China believes this or wouldn’t be buying anything. Should we suddenly decide to hyperinflate our currency, well, we’ll just pay back our debt with freshly printed money. You say that many speculate that the US dollar will no longer be the world currency, but you’ll have to point out who those ‘many’ are. The international money markets don’t reflect that speculation.

        Deflation is bad, Hyperinflation is bad, but a moderate amount of inflation designed to keep pace with or stimulate economic growth is perfectly acceptable. If you feel the US dollar is overinflated, check it’s rate against other currencies and you’ll see that it really is common practice.

    • AstroPig7 says:

      It’s almost as bad as arguing evolutionary theory: one side can ask simple questions that require complex answers and then “win” the debate when the audience doesn’t want to hear anything longer than a sound bite.

  41. aikimann says:

    Ok, look people. Ron Paul is NOT advocating that everyone carry around actual gold in their pockets, even though that’s what Stephen Colbert was facetiously implying.

    Do you know how people paid for things when we were on the gold standard, pre-1968? With paper money. Dollar bills just like what you carry on you now. The difference being, you could trade those in at any time in exchange for it’s equivalent value in gold, so it was MUCH harder for the government to print money whenever they wanted.

    Here’s what’s happened to the value of the US dollar when we got off the gold standard:
    http://upload.wikimedia.org/wikipedia/en/d/d7/Value_of_US_dollar.gif

    Is the idea so crazy now?

    • exconsumer says:

      Yes, it’s still crazy. Sure, the value of the dollar dropped, but that devalued dollar did not reduce our standard of living or reduce our economic power worldwide. A Gold standard isn’t a good thing, and that’s why no one does it.

  42. mikeycav says:

    Yes I agree. So the guy has a different opinion, big deal. It wasn’t too long ago that we left the gold standard (1971).

    He is a chairman, not a dictator, nor a “czar”. Can’t decree one day we are back on the gold standard, or gold exchange standard.

  43. VeganPixels says:

    Why does Ron Paul hate pants so much and what have they ever done to him?!

  44. DerangedKitsune says:

    Proof that in politics, you just kind of fail upwards.

    Remember Ted Stevens was chair of the United States Senate Committee on Commerce, Science and Transportation during the whole Series-of-Tubes fiasco.

  45. MB17 says:

    God damnit. Looks like consumerist comments are becoming the troll orgy that already exist on every other website in the world.

  46. notthere56 says:

    I’ve been a reader of this website for a few years, and have found out lots of relevant information. Perhaps that will continue, but not if Ben Popken continues down his apparent new road. Ron Paul is a nut? Passing along the Federal Reserve’s press release as an item? The oil has magically disappeared from the Gulf of Mexico? Somebody drank a lot of globalist eggnog over the holidays, and it wasn’t me. I doubt it was a very large percentage of your readers, either. Your foray into politics is ill-advised, to put it mildly. Lose it or lose me and my like-minded cohorts. A better direction would be to take note of the surprise smash hit book in France, Indignez Vous! by Stéphane Hessel, exhorting his fellow Frenchmen to nonviolently resist the corporate/bankster takeover of society. That’s what’s needed, not your pseudo-pundit pulpit pontifications promoting the idea that there’s nothing systemically wrong here, just keep buying stuff. Is that really how you see yourself? If so, I guess the website’s name is more literal than I thought.

  47. EverCynicalTHX says:

    I can’t believe the almost slanderous description – talk about a biased opinion. Does parent company Consumer Reports condone this kind of stuff?

    “Ron Paul, career-long proponent of outmoded and discredited Austrian economic theory, went on Colbert last night to talk about how paper money sucks and he wants you you to be able to go into a store and buy a six-pack with some gold ingots. His proof? Paper money can rot and people have believed in the value of gold for centuries. So, gold is “better” because the collective hallucination around it is stronger. This wouldn’t be disturbing except for the fact that Ron Paul is the new Chairman of the House Financial Services Subcommittee on Domestic Monetary Policy. “

  48. areaman says:

    In having reviewed the draw backs of fiat and gold backed currencies…

    I’m not in favor of reverting back to gold backed.

    One of the problems being it discounts/put hurdles in front of wealth being created by companies like GOOG.

  49. Streakist says:

    I come here for news. If I wanted opinion and propaganda I’d watch the news.

  50. Telekinesis123 says:

    Sorry Mr. Popken but you have no idea, what fiat money is, nor the history of the federal reserve, but you sure act like you do.

  51. fischju says:

    Ben, you have no idea who Ron Paul is besides the first line of Wikipedia do you? He’s a fervent supported of Wikileaks, the right of the people to have knowledge of their goverment, and has been against both wars and the Patriot act from the beginning. Yes he’s a hardcore libertarian, but his beliefs are consistent. He’s only of the only honest politicians with integrity left. I might not vote for the guy if he was on the ballot, but fucking respect him. He’s not a Fox News candidate. (They hate him over there)

    • ipsedixit says:

      He’s a hardcore libertarian which means he’s more enamored with his ideology than with reality. He might hit a few nice notes, but anyone who’s so excited with a philosophy and not a college freshman is going to be wrong about a lot of stuff too. That’s not the kind of person that should be running the country. Give me somebody who’s willing to look at the real world and make decisions based on what he or she sees rather than someone who looks at the world through ideologically tainted glasses and then tries to fit what they see into their preconceived notions about how the world should work.

      • nutbastard says:

        your principles should shape reality, not the other way around. you start from a position of integrity, accountability, and responsibility and let the world adjust. to base ones principles on coping with the conditions that have been caused by the evils of your ancestors and contemporaries is to surrender to them. it’s a prison survivalist mentality to adopt the path of least resistance.

        i believe it was Gandhi who said “Be the change you want to see in the world”.

  52. nallanos says:

    gold is just as stupid but to smear ron paul is clearly showing your political inclinations. booo consumerist!

    paper money is dumb but it doesn’t even cross many peoples’ hands like it used to; we’re all about plastic. money is the idea of standardizing the value of a good. so paper, plastic, or gold are just the same.

  53. psm321 says:

    I happen to agree with Ben. Also I usually think people are exaggerating when they complain about political bias on this site. But the wording on this post is really over the top…

    • Maximus Pectoralis says:

      Fox News viewers also complain about exaggerations of political bias. As someone pretty much in the middle, I’d have to agree with both “exaggerations” (Fox = right and Consumerist = left). The sad thing is that Consumerist is supposed to be focused on a specific topic, that being consumer rights etc. but seems to draw in a lot of unrelated political content, and from what I’ve seen it is ALWAYS pro-left / anti-right / anti-libertarian.

      • psm321 says:

        Opposing receipt-checking is anti-libertarian? :)

        And the contrast is that Fox News actually IS biased the vast majority of the time. Consumerist occasionally is (such as stories like this)

  54. chucklebuck says:

    If this goes through, I can launch my new business venture – Gold4Gold.

  55. GreatWhiteNorth says:

    Wasn’t the migration away from gold standard / gold backed money made so that governments (or in the case of the US the Federal Reserve – not part of the government) could print as much money and they needed to pursue their economic policies (right or wrong)?

    Going back to a gold standard or actual gold itself would be extremely difficult and I would imaging enormously impractical.

    • exconsumer says:

      That the Fed is not part of the Government is incorrect. It is a government created and run entity. employees and appointees are paid by the treasury. Gov board is nominated by pres and confirmed by senate.

  56. agraham999 says:

    Gold won’t mean much in the future if you don’t have water or food. Remember that Salt was once worth more than gold. Something is only worth as much as someone else is willing to pay for it. Diamonds, which at one point were extremely valuable (and illogically still are) are completely worthless when you consider that perfect stones can be created in labs…and diamonds used in manufacturing are worth more than some useless artifact on your finger.

    Paul is an idiot or a fool if he actually believes that moving from one meaningless standard to another really will make any difference. At the rate we’re going, an ounce of beef or fish or honey might be more valuable in 50 years than some metal dug up from the earth.

  57. bhr says:

    To quote your former sister site, “You poked the Paultards”

  58. supersarah says:

    I don’t know how legit this site is http://www.newton.dep.anl.gov/askasci/gen99/gen99241.htm but gold sounds heavy. As obesity rises, would we as Americans even be able to carry around this currency?

  59. Maximus Pectoralis says:

    I’m not excusing Bush and he certainly was no Ron Paul in terms of economic policy. Ron Paul and the Tea Party (yes, contrary to what MSNBC might say they existed before Obama became a national celebrity) were against the outrageous W spending.

    In his 8 years in office, W increased the national debt by about $4.2 trillion. This includes the 2 years (2006-2008) when the Democrats had an iron grip on Congress.

    Since W left office to now, the national debt has increased nearly another $4.1 trillion. That is in 2 years.

    As a % of GDP, That goes from 70% (Bush) to 95% (Obama). Neither are good, but Obama certainly isn’t helping.

    As for %, Reagan had it around 55%, and if you want to go back a little further, Roosevelt had it well over 100%.

    • exconsumer says:

      Yes, Reagan had it at around 55% . . . INCREASING IT increasing from the previous 32%

      Yes, Roosevelt had it around 95% . . . LOWERING IT from the previous 117%

      Two questions: Why do you think you will successfully mislead anyone when the data is freely available? And, why do you feel it is appropriate to mislead people about the fiscal practices of US Presidents?

      • Maximus Pectoralis says:

        Sorry this was supposed to be in response to another post.

        Yes Reagan increased it, eveyrone knows that, so what?

        Also to my knowledge, Roosevelt started with about 50% and ended at nearly 120%. When did he decrease it?

        My original point though, was that while other presidents have had increases in deficit spending, the current rate since the 2006 Congress / 2008 Presidential elections is by far the highest since WW2, in the middle of the biggest and most expensive war of all time (and Obama’s spending rate is very closely approaching that). People complain about W’s deficit spending but Obama has done more damage in 2 years than Bush did in 8.

  60. tz says:

    “outmoded and discredited Austrian economic theory”

    How so? He was exactly right about the debt bomb and the housing bubble.

    The Keynesians are proving to be clowns and idiots and generally wrong on everything.

    The neoclassical economists are the ones calling not enforcing fraud “free trade”.

    Or should I see the consumerist article hawking Laetrile describing the “outmoted and discredited chemotherapy”. That is the problem – it describes money and credit and the problem. You love debt and inflation.

  61. rambo76098 says:

    I love Ron Paul, but taking Gold as currency at retailers? That’s a bit far from anything plausible we could ever expect to happen. C’mon Ron, keep the common sense attitude going but the crazy ideas on monetary policy in check.

  62. dush says:

    If you pay attention to what Paul has been saying other places the whole point of having a gold currency standard is not to even replace the dollar. But to have a competing currency and remove the federal reserve monopoly on the purchasing power of citizens.

    Also regarding the talk about inflation that NYTimes guy was just dumb. The whole reason Paul advocates for the currency changes is because of those bubbles he brought up. And the NYTimes guy clearly had no viable response. His only answer was don’t worry about inflation because look at how bad our economy is due to the inflationary bubbles that fiat currency and poor monetary policy caused. What a ludicrous response!

  63. Spinfusor says:

    Ben, please leave the politics to the Huffington Post and Drudge Report.

  64. Jimmy37 says:

    Uh, where is Austrian economic theory discredited? And how is printing paper better than gold? For what ever the reason, gold has been desired by people. Economist say that money has a few functions:
    – Store of value – if you print more, it’s worth less
    – Medium of exchange – if it’s worth less, people will stop wanting to use it.
    – Standard of deferred payment – if people stop using it, you can’t pay debts with it.
    Gold has none of these problems since it’s rare and can’t be created out of nothing. That’s why a gold-standard makes sense.

  65. Ixnayer says:

    I don’t know him but I’m gonna say Ben Popkem is a registered democrat? Congratulations on using an “unbiased” website to push a liberal agenda. “This wouldn’t be disturbing…” What a load of crap. Maybe I shouldn’t post this since my account will be suspended for calling out an editor on his political bias.

  66. EverCynicalTHX says:

    One final though since many of us gave Ben a bruising today. We like the site, we like most of the articles but maybe less political commentary and bias.

    Maybe a little relevant consumer humor too – this would have been a winner and more relevant ;)

    http://www.thedailyshow.com/watch/mon-january-3-2011/san-francisco-s-happy-meal-ban

  67. Greely says:

    Libertarians have no friends: liberals call you an idiot, Democrats think you’re insane, Repubilcans consider you a threat, and conservatives compare you to perverts.

    Personally, I like their whole “burn it to the ground” attitude in regards to the government.

  68. rickatnight11 says:

    Dammit, Milton Friedman. Why can’t you still be alive, so you can explain to people exactly how this currency thing works. I’ve never read more simple, to the point, and rational points than those you made in your 1973 Playboy interview.

  69. zegron says:

    Well, we can see where your viewpoint lies now can’t we Ben. Nice of you to arbitrarily announce to the world that an economic method is dead. What qualifies you to do such a thing exactly?

    Disappointing Ben. :-(

  70. jonspoke says:

    Ron Paul’s solution may not be perfect, but at least he is drawing attention to the issue of the doubling of the monetary base, ‘sound money’, and how to reduce further inflation; not to mention pulling back the curtains of secrecy from the privately owned (not federal government) Federal Reserve Bank.

  71. FoxCMK says:

    Wow. Your commentary is quite possibly the most mind-bogglingly ignorant thing I’ve ever read on Consumerist, Ben.

    I’ve always been a little shaky on the ill-informed opinion on this site, but this just takes the cake. You can say whatever you’d like in the privacy of your offices about the irrelevance of a single user calling it quits on Consumerist, but wearing ignorant and insulting prejudices on your sleeve like this will do nothing to bring in new readers and only serve to drive people like myself away. I wish you good day, and hope that you open your mind a little bit and listen to the economic opinions of people who have been studying the field longer than you’ve been alive.

  72. sean says:

    What’s incorrect about anything said here?

    Paper money can be devalued in an instant. All you have to do is print more. By golly, that’s what the government is doing!

  73. Joe_lovz_buying says:

    This is a really bad idea because there isn’t enough gold.
    $259,200,000,000 of gold is how much gold the US currently has

    $977,984,000,000 is how much gold all of the governments of the world collectively have.

    The US would have to go on a massive buying and development spree to back the economy with gold. It just wouldn’t work anymore.