As off-the-wall as it may seem, Republicans in Congress and their conservative base are waging a rhetorical war against an “insidious” policy to “debase our currency” that was first initiated by…President Abraham Lincoln.
You see, our 16th president was also the first to issue paper currency backed solely by the federal government, not gold or silver. And that’s something that House Republicans and their neo-secessionist pals just can’t stand.
As Paul Krugman notes, the Republican Party is no longer the party of Lincoln.
But sooner or later, Republicans were bound to notice other reasons to disavow Lincoln. He was, after all, the first president to institute an income tax. And he was also the first president to issue a paper currency — the “greenback” — that wasn’t backed by gold or silver. “There is nothing more insidious that a country can do to its people than to debase its currency,” declared Representative Paul Ryan in one of two hearings Congress held on Wednesday on monetary policy. So much, then, for the Great Liberator.Which brings me to the story of what went on in those monetary hearings.
One of the hearings was called by Representative Ron Paul, a harsh critic of the Federal Reserve, who now has an oversight role over the very institution he wants abolished in favor of a return to the gold standard. Mr. Paul’s subcommittee called three witnesses, one of whom was an odd choice: Thomas DiLorenzo, a professor at Loyola University and a senior fellow at the Ludwig von Mises Institute.
What was odd about that choice? Well, Mr. DiLorenzo hasn’t actually written much about monetary policy, although he has described Fed policy — not just recently, but since the 1960s — as “legalized counterfeiting operations.” His main claim to fame, instead, is as a critic of Lincoln — he’s the author of “Lincoln Unmasked: What You’re Not Supposed to Know About Dishonest Abe” — and as a modern-day secessionist.
No, really: calls for secession run through many of Mr. DiLorenzo’s writings — for example, in his declaration that “healthcare freedom” won’t be restored until “some states begin seceding from the new American fascialistic state.” Raise the rebel flag!
O.K., it’s going to be a while before the G.O.P. as a whole embraces neo-secessionism, and Mr. Paul, although highly visible, is, in fact, a somewhat marginal figure even within his own party. But Mr. Ryan, who led the other hearing — the one at which Ben Bernanke, the Fed chairman, testified — is a rising Republican star. So it’s worth noting that Mr. Ryan’s hard-money rhetoric was nearly as bizarre as Mr. DiLorenzo’s.
……………………..……………
Wednesday’s hearings aren’t likely to have any immediate effect on monetary policy. But they offer a revealing — and appalling — look at the mind-set of one of our two major political parties. We’ve always known that the modern G.O.P. wants to take America back to the way it was before the New Deal; but now it’s clear that the party wants to build a bridge to the 19th century, and maybe even to the antebellum era. Backward, march!
Some examples of people who believe in the gold standard:
-Cranky old baby boomers who still pine for the “way it was back then” (you know, when the Russkies could drop a bomb on us at any moment and every person lived in constant mortal fear).
-Youth who were recommended Zeitgeist on Youtube by a friend on Facebook, and now they think they know everything about how the world works.
-Irate accountants or politicians who haven’t done anything relevant in years, who can rattle the saber of “gold standard” every now and then to get some attention
…and so on. Gold standard has been debunked for decades, in any number of ways. It’s a relic as quaint in its naivety as trickle-down.
Given the number of booms and busts in the 1800s, an era with gold backed currency, I’m skeptical that moving back to a gold backed currency would really solve anything.