So maybe I shouldn't have Stoli before a post. Please forgive my Professor Drunkard mode of thought here.
I readily acknowledge that I'm not an economist, but neither is Dr. Paul. To his credit, he doesn't fully embrace the gold standard (which is good,
because we're in too deep to go to a pure gold standard again)
I wish I could find it again, because it was brilliant, and naturally I forgot to make a Firefox bookmark or a delicious bookmark, but it was an essay
talking about different types of fiat throughout history, and the reasons they failed. It ALSO discussed various sound money systems which also
failed, gave great reasons why we are not like Rome, or the Weimar Republic, and what I felt was a sound strategy--keep changing the way money works,
every 30 years or so, just in time for the current standard to fail.
Before I go into this, I want to point out the reason I think von Mises and Rothbard are wrong on some things, despite being brilliant, is that
they're incredibly naive--to the point that they felt everything could be explained by economics. Cain and Abel could not be explained by economics,
sorry. Also, von Mises' theories on how capitalism could work seem to hinge on people being rational--a fatal error.
And although I linked RP to Libertarianism, I really doubt he'd support the Rothbard extremism, or at least I hope he would.
I suppose my problem with the staunch gold standard types is that they don't understand that such systems, which is that any time someone becomes a
rich power, they become a target. Fort Knox exists for a reason, yes, and it's because a hard-asset money is a target. You could argue that putting
it in circulation makes it harder to hit, yes, but one has to take great care to make sure nobody's "cutting" the gold (devaluing the currency) and
you have to keep it out of the hands of foreigners.
Another suggestion I've seen is to use infrastructure as a basis for sound money. Are you kidding me???!? We tend to congregate in cells, known as
towns and cities. The infrastructure tends to follow the humans. How many cities are there in the U.S.? How few nukes would it take to not only
wipe out most Americans, but completely destroy the currency at the same time?
I could go on. I've not seen a plan yet that a moment's thought cannot shoot down. I will agree that our current system is pretty freakin'
My own feeling is that it's not fiat, but lousy policy which makes fiat fail. Under fiat, the money itself isn't worth anything (which is where
"worthless paper" comes in), but it represents what someone else thinks you're worth. For example, let's say you live in a fancy suburb, and your
kid goes to work for Wal-Mart as a cashier, and gets paid $10/hour. Running a cash register for an hour has been assigned a numerical value. Your
kid wants an iPod, which is $150 of that worthless paper, and your kid buys it at Wal-Mart on the employee discount. So, your kid can put in about a
week of work, and get an iPod out of the deal. Under a strict Austrian view, Wal-Mart is giving up a hard asset for nothing--which completely
ignores that your kid worked 15 hours to a piece of Chinese junk.
To me, fiat isn't worthless--but bickering about what our ultimate goal for fiscal policy, in light of a pressing economic disaster, is quite
I've made a habit of reading career politicians' writing with a jaded eye, and I hate to say it, but RP sets of my BS-o-meter quite a bit. I mean,
amongst other things, he proposes pork, excuses it as in the interest of his constituents, then votes against it to uphold is principles. And,
frankly, he's manipulated the media so that he'll ignore him. Men of honor do not engage in this sort of behavior; however, career Washington
Again, I respect RP for getting the discussion going, and for presenting his views, but I respect little else about him. Sorry to piss you off, but
I'm "awake," too.