The Case for Gold — Again

In the New York Times, Floyd Norris reminds us:

The 1980 presidential election was fought by a Democratic incumbent weakened by a poor economy amid worries that the United States had lost its ability to compete in the world. Gold prices had risen to unprecedented levels as the election approached, and the Republican nominee hinted he might propose a return to a gold standard.

That Republican, Ronald Reagan, won the election and soon appointed a commission to study the role of gold in monetary systems.

And now:

Last month, Newt Gingrich, seeking to widen his support in the days leading up to the South Carolina primary, promised that he would appoint a new gold commission. “Part of our approach ought to be to re-establish something Ronald Reagan did in 1981 and that is to have a commission on gold to look at the whole concept of how do we get back to hard money,” he said in a speech.

Whatever the likelihood of Gingrich’s ever being in position to appoint a presidential commission, the minority report of the U.S. Gold Commission, by Rep. Ron Paul and Lewis Lehrman, still makes for worthwhile reading. And conveniently enough, it’s available right here at the Cato Institute. Download a pdf or epub here.

For a more recent analysis, read “Is the Gold Standard Still the Gold Standard among Monetary Systems?” by Lawrence H. White.