Ron Paul would ruin the economy

[Ironslave]

Please help me refute this idiot!

Paul is not interested in a dollar partly-backed by gold as it was under Bretton Woods System. Instead, Paul wants a dollar fully backed by gold, as it was in the days before Franklin D Roosevelt. This would be disastrous for America on several fronts. First of all, there is not enough gold in the world to supply America's economy. A gold standard, then, would result in massive deflation which would stymie investment, encourage hoarding, and trigger a depression cycle. America's dollar would also be dependent on gold-mining nations such as South Africa and Australia, which would mean that America would no longer have any control over the value of her dollar. Because America exports a trillion dollars a year, and also has a massive trade deficit, America would bleed gold which would require a crippling recession to remove the trade deficit.

 

[murrayrothbard]

Wow what's the point? Would have to send him a book

 

[dmspilot00]

He doesn't want to put the dollar on a gold standard. He wants to legalize gold AND SILVER to use as alternative currencies. It's actually illegal to use gold or silver right now, plus there are all kinds of taxes on them.

 

[bbachtung]

See the essay by Murray Rothbard, "The Case for the 100 Percent Gold Dollar," written while Bretton Woods was still in existence.

http://www.mises.org/story/1829

 

[ronpaulfan]

cough*troll*cough

 

[bbachtung]

Here's a great passage from the above essay:

Keynesians and Friedmanites alike maintained that the gold bugs were dinosaurs. Whereas Mises and his followers held that gold was giving backing to paper money, both the Keynesian and Friedmanite wings of the Establishment maintained precisely the opposite: that it was sound and solid dollars that were giving value to gold. Gold, both groups asserted, was now worthless as a mon*etary metal. Cut dollars loose from their artificial connec*tion to gold, they chorused in unison, and we will see that gold will fall to its non-monetary value, then esti*mated at approximately $6 an ounce.

There can be no genuine laboratory experiments in human affairs, but we came as close as we ever will in 1968, and still more definitively in 1971. Here were two firm and opposing sets of predictions: the Misesians, who stated that if the dollar and gold were cut loose, the price of gold in ever-more inflated dollars would zoom upward; and the massed economic Establishment, from Friedman to Samuelson, and even including such ex*-Misesians as Fritz Machlup, maintaining that the price of gold would, if cut free, plummet from $35 to $6 an ounce.

 

[Mr. White]

Wow. Uh... where to begin... Tell him his premise is flawed...that the dollar would be backed by a fluctuating proportion of gold, so it could be 1/100 or 1/1000 of an oz per dollar, whatever.

Your friend can think logically, that's a start, but if he's going to draw correct conclusions he needs to start with correct facts.

There's a lot more to it, but I'm not the best one to explain it.

 

[Adamsa]

Steve Forbes wants a dollar backed by gold. Ron Paul is kind of half way and would allow competing currencies.

 

[jashepard]

mixing the logical and illogical together, what every ron paul hater does to fit their belief system.

 

[Johnnybags]

The economy was already ruined by the FED

tell the idiot about the socialism experiment bailing out banks. It means our economy will pay for it for 20 years, like Japan. Oh, and who is going to roll over 400 billion in maturing corporate debt coming due? Do we need to socialize that as well, while privatizing profits for Goldman?

 

[Adamsa]

Besides, one thing I've learned is, that you can't predict the economy unless you identify trends, this guy hasn't.

 

[James R]

Please help me refute this idiot!

As an experienced investor, anyone who says Paul would damage the economy is not worth arguing with. I can't imagine a person who has knowledge of how the economy works would ever think Paul has anything but extremely smart economic plans for our country. Its easily his strongest point. So I'd advise you not to refute him to ask him to provide a shred of evidence that free-market economies do badly against command economies such as the USSR.

 

[Paul.Bearer.of.Injustice]

Ron is against fiat money and pro sound currency.
A gold-backed dollar is only one of many options of backing paper with a worthy commodity.
FWIW, our dollar now is essentially oil-backed.
What's worse - a dollar backed by a diminishing resource, or one backed by gold which doesn't decay or rust?

 

[Zym]

"encourage hoarding" Waaahahahahahah! You know, when I was a kid "hoarding" money had a different name, we called it "saving". Our economy is run on credit, and sooner or later it's the bill is going to come due. What you are seeing right now with credit, or "cheap money", AKA as low interest rates, is the same thing the FED did during the run up to the great depression. Make money REALLY easy and cheap to borrow, convince every one they need stuff (During the depression it was mostly farmers and farm equipment like shiny new tractors). Then constrict credit and raise interest rates until no one can afford their loans. The end result? A huge chunk of personal property ended up owned by foreign banking families (AKA the Federal Reserve). It was a national yard sale and the banks who make up the federal reserve were the ones buying for pennies on the dollar. That can't happen with sound money.

 

[Paul.Bearer.of.Injustice]

Moreover, the reason there's not enough gold to back all the dollars is indicitive of the issue itself: there's simply too many dollars on the market, courtesy of the Federal Reserve.

 

[slantedview]

How do you refute an idiot?

Here's one quick way:

The federal reserve created the housing crisis, which led to the current forclosure and credit crisis', by lowering interest rates to 1%. Ron Paul would help the economy in preventing similar future crisis' by getting rid of the Federal Reserve.

One would ask, well then why doesn't every candidate get rid of the Fed? Answer in two parts: because they take large donations from the financial industry which benefit from the fed, and because they have no balls.

 

[slantedview]

Moreover, the reason there's not enough gold to back all the dollars is indicitive of the issue itself: there's simply too many dollars on the market, courtesy of the Federal Reserve.

We could, it would just be a fractional reserve. As long as the "fraction" stayed fixed, things couldn't get too much (more) out of hand.

 

[a_european]

The irony:
The economy IS ruined.

 

[slantedview]

The irony:
The economy IS ruined.

yeah. my comments above pertain to once the economy rebuilds after the impending recession/depression/collapse/thing. with the fed and the dollar still here, expect it to happen again.

 

[guntherg16]

Wow. Uh... where to begin... Tell him his premise is flawed...that the dollar would be backed by a fluctuating proportion of gold, so it could be 1/100 or 1/1000 of an oz per dollar, whatever.

Your friend can think logically, that's a start, but if he's going to draw correct conclusions he needs to start with correct facts.

There's a lot more to it, but I'm not the best one to explain it.

Right on.

I long for those "good old days" when a penny could actually buy something.