Response to: Golden Ferrets, I Mean Fetters
This is getting so tiring. Do liberals ever come up with new, interesting points - or is their strategy of indoctrination merely brute force repetition?
Krugman has a new blog post, which I’ll easily refute with points I’ve already made here.
Apparently, the new outrage is that the Republican Party wants to add a “gold commission” to their platform, to “look at restoring the link between the dollar and gold.” This is obviously just a way for the mainstream GOP to placate vocal Ron Paul supporters without any intention of implementing any real changes.
But, as always, liberals are outraged.
The very idea of returning to the gold standard is barbaric to them. We can’t allow our economy to go back to the dark age monetary system that ended in the early 70s! No, sir!
Democrats don’t like going back to the way things used to be. Unless it’s to New Deal-era job creation programs that don’t work. Or a return to historic top marginal tax rates that have no bearing whatsoever on the modern tax code. It’s okay to go back to the 30s…but the 1970s are waaaaaay too primitive. How silly of Republicans to want to take us back to that! Who cares if that “income inequality” we’re all harping on started to really kick into high gear after the implementation of a fiat currency managed entirely by governing elites? Forget all that - APPLE DOESN’T MAKE GOLD COINS!
I’m not going to argue for or against the gold standard. Not the point. It’s just ridiculous to ridicule a commission, one likely to be entirely ignored anyway, simply because they want to investigate possible advantages of a commodity-backed currency. Aren’t we supposed to be adults? Aren’t we supposed to be “open-minded?” Since when does the intellectually superior left hate investigative inquiry?
Maybe a gold standard does have some advantages. Again, I won’t make the argument, but I also can’t talk to a liberal for more than 30 seconds without hearing about how much better life for the middle class was in the 50s and 60s. (POP QUIZ: What monetary system were we on then?)
Krugman:
Bear in mind that the incessant warnings of runaway inflation from the expansion of the Fed’s balance sheet have been wrong, wrong, wrong;
Well, I’ve been warning about inflation, and still am. Just because something hasn’t happened YET doesn’t mean it won’t. If Krugman was in Pompeii, he’d have a villa at the top of Vesuvius, bragging about how volcanos never erupt.
Furthermore, Krugman himself believes that expansion of the Fed’s balance sheet will lead to inflation. He keeps publishing editorials asking Bernanke to expand the Fed’s balance sheet and allow for higher inflation targets!
Not Enough Inflation
Why We Need an Inflation Target
and
Why Inflation Targets Need To Be High (Wonkish)
He’s ASKING the Fed to create inflation, but the only way for the Fed to do that is through…expanding their balance sheet.
Short-term interest rates may be zero, unable to go lower, but longer-term rates aren’t. So the Fed, which typically buys only short-term U.S. government debt, could expand its portfolio, buying long-term government debt, bonds backed by home mortgages and so on, in an effort to drive down the interest rates on these assets. source
Krugman can whine all he wants about a “liquidity trap” to keep inflation under control, but it’s absurd for him to denounce people expecting inflation from Fed balance sheet expansion when HE HIMSELF is advocating Fed balance sheet expansion to create inflation.
More from today’s blog:
Nonetheless, the GOP is convinced that what we need to do is base future monetary policy on a doctrine that has totally failed in recent years.
Huh? The gold standard has “totally failed in recent years?” The gold standard we haven’t been on since 1971? See, this is just a primo example of naked propaganda. It is KRUGMAN’S doctrine of cheap fiat money that has “totally failed in recent years” - there’s no room for debate here; we are incontrovertibly NOT on a gold standard. We’ve been failing on the Krugman standard - yet he hilariously blames gold!
What a hack!
Even if you didn’t know anything about economics or the gold standard or inflation - the obvious contradictions in everything Krugman writes should be enough to reveal him as a fraud.
Whatever. I’ve got all my money in Greek drachma.
