Barney Frank rounds up liberal opposition to Sound Money Act:
Obviously this article is provocative, but it’s clear even to some Dems that high prices come from the cheap dollar, which comes from a discretionary monetary policy. The mandate of the Fed to maintain low unemployment seems not worth the paper on which it is written.
Good Money: Why Rep. Kevin Brady’s Sound Dollar Act Worries Barney Frank
…Frank and other liberals are hostile to legislation that constrains the Fed’s “discretionary activism.” Discretionary activism is what Columbia dean (and key Romney economic policy advisor) R. Glenn Hubbard indicts in Seeds of Destruction: Why the Path to Economic Ruin Runs Through Washington, and How to Reclaim American Prosperity. This book contains a chapter entitled “Why an Easy-Money Street is a Dead End” and a subchapter “The Road to American Prosperity Cannot Be Paved with a Cheap Dollar.”
Brady’s legislation plays a major role in helping the GOP formulate a crucial plank in its economic platform: good money. Even more potent is this bill’s extraordinary emphasis on gold. In its findings, the Act directs the Federal Reserve to monitor prices in three sectors. One is, exclusively, gold: The “Federal Reserve should monitor … the value of the United States dollar relative to gold… to determine whether the Federal Reserve’s monetary policy is consistent with long term price stability.” Another section directs the Fed to monitor the prices of “major asset classes (including… gold and other commodities…).”
Because it is an utterly stupid and reckless idea.
Next question.
Why is the Fed allowed to ignore its full employment mandate?
I think it’s because bankers believe it’s in their interest to rein in inflation — and bankers are the constituency that pays the most attention to the Fed.
Skip the obfuscation and mumbo-jumbo in the Fed’s own description of its ownership and follow the money to the answer:
My ellipses provided for clarity …
What indication of that do we have?
consider that currency is sound only when deposited in musical banks, institutions with which the Federal Reserve has nothing to do.
Happy days
Rule of Thumb: some ideas are not worth reconsidering. One of those ideas is that the earth is flat. Another is that the four humors. Another is that God created the Earth in 7 days. It’s literally a waste of time to discuss these ideas on their merits. Returning to the gold standard ranks a bit higher than these ideas, but not really much higher. The idea is no more “controversial” than who shot J.R.
On top of the stupid idea, this is so crazily written. There are a lot of reasons movement conservatives are stupid, but it’s writing like this that makes it so impossible to carry on a reasoned dialogue. Here are some not exactly unbiased gems:
There are no mainstream economists looking to get climb aboard the gold standard. The idea is so loony, it does jumps over the economic work of Milton Friedman back to the crazies of the 1930s. This is just crazy talk.
“Crazy talk” is the best description of this lunacy I’ve heard. This kind of insane garbage is what I mean when I write, elsewhere, that the GOP banks on ignorance in its campaigns.
The notion of a return to the gold standard does, in fact, have about as much reality as the claim that the Earth is six thousand years old, that evolution is a fraud perpetrated by non-believers, and that anthropogenic global warming is a fraud perpetrated by a vast liberal conspiracy. All of these absurd claims are rooted in the same fundamental presumption that the listener is either utterly and absolutely ignorant or appallingly superstitious.
Even if this is an insane and bad idea coming from the historical re-enactment corner of Wingnuttia, it has an immediate appeal to those who don’t know better.
The simplified logic: America has become less American. Our currency too. Part of restoring America to our founding principles is to return to how our currency used to be based.
This wrong idea is much easier to explain, alas, than international trade.
has a genuine interest in economics. But this is like studying alchemy.
I have a different view. My impression is that seascraper has already decided what his views are (such as wanting America to return to a gold standard — a colossally bad idea), and I think he finds and quotes obscure wing-nut economists that he thinks support his view while skipping over the persuasive arguments of the mainstream. I don’t see evidence of any sincere interest in economics, and I don’t have the time or patience to laboriously sift through such right-wing bunk.
In my view, perpetuating threads like this is like participating in debates about evolution with a creationist — the debate itself does more to perpetuate the crazy idea than the idea merits.
right about the effect of the weak dollar on oil prices. I don’t think he was completely right on the degree of the effect or the policy implications, but he was dealing with a real concept.
All of us start with preconceptions. I’m sure Seascraper does too. To hazard a guess, Seascraper reads financial stuff and ends up swimming in their cess pools. I don’t know whether he dives in or just ends up wading in too deep.
Education is a process. It is not self-evident that the earth is round, evolution occurred over millions of years, or that a return to the gold standard is the economic equivalent of a return to idol worship as a way to forecast the weather. It is a tragedy that some of our fellow Americans are so deluded as to believe such fables — and appear not to see how grotesquely they are being manipulated to serve the interests of a few (who might indeed benefit from a return to the gold standard!) — but it appears to be the case. Responding with silence has as little effect on the faithful as responding with reason, I agree, but 90 percent or more of the people who read BMG do not comment. It is to them that Mark’s excellent comments are, or should be, truly addressed, and there they have real value.
So, despite appearances, Mark-Bail is not having a discussion with Seascraper. No, no, no. He is instructing the silent 90% while only appearing to have a discussion with Seascraper.
By similar reasoning, this comment is not addressed to Bob_Neer either but to some other silent BMG consumer fascinated with meta.
I share your high opinion of Mark’s comments. I fear they are wasted in this context.
I don’t necessarily mean that we should respond with silence. Instead, perhaps we might refer interested readers (maybe even on a FAQ page, as on realclimate) to the THOUSANDS of already-written accessible and sound treatises that carefully explain why the statements in question (“the Earth is flat”, “God created life in six days six thousand years ago”, “America should return to the gold standard”) are at best mythical fables with NO basis in reality.
The information about these topics is already widely available to any interested reader who cares. My view is that further “discussion” therefore serves primarily to add disinformation.
The obvious case in point is anthropogenic global warming. The next most obvious case is evolution.
is offered in the first part of this video.