Re: [OT] why was private gold ownership made illegal in the US?
Just curious, but what was the rationale under which private posession of gold was made illegal in the US? It boggles the mind...
Roosevelt needed to in effect devalue the dollar during the Great Depression. In a deflationary depression, this acts as an inflationary force to cancel the negative effects of the deflation. Even libertarian monetarists such as Milton Friedman agree that this is the proper approach when dealing with a depression. Roosevelt did not have the advantage of modern economics and he made many economic mistakes which prolonged the depression, but devaluing the dollar was not one of them. However doing a straight devaluation was politically unacceptable at the time. Because the dollar was pegged to gold, devaluing the dollar meant in effect increasing the value of gold in terms of dollars. This would represent a tremendous windfall to holders of gold. And gold, by and large, is owned by the rich. At the time, the U.S. faced a significant chance of a Communist/Socialist revolution such as had been seen in several other countries. Class warfare was widespread, with armed violence between workers and management a common occurance. Transferring a huge bounty into the hands of the rich would have inflamed the working class and risked plunging the country into chaos and revolution. By eliminating private gold ownership, Roosevelt was able to take a necessary step to invigorate the economy, devaluing the dollar, while reducing the risk of a civil war. The rich protested, of course, but in practice they went along with the measure as they were terrified of a workers' revolution. Looking back, since there was, in fact, no revolution, it is easy to forget today how perilous the state of the country was in those times. For all those who curse Roosevelt's name, the U.S. at least ended up the decade in better shape than many countries, and things could have been far worse. Americans could be living in a People's Republic today. Confiscating gold was clearly the lesser of the evils.
At 2:36 AM +0200 on 7/3/02, Our Paleo-Keynsian Idiot from Austria wrote:
Looking back, since there was, in fact, no revolution, it is easy to forget today how perilous the state of the country was in those times. For all those who curse Roosevelt's name, the U.S. at least ended up the decade in better shape than many countries, and things could have been far worse. Americans could be living in a People's Republic today. Confiscating gold was clearly the lesser of the evils.
Jesus Christ. Quit humping FDR's leg, already. Not only could the man not feel it, he's dead already. Besides, that's Falla's job, and, like little men, you don't *ever* want to get a little dog pissed off. Go clean yourself off, man. There's hose out back... Cheers, RAH -- ----------------- R. A. Hettinga <mailto: rah@ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
-- On 3 Jul 2002 at 2:36, Anonymous wrote:
However doing a straight devaluation was politically unacceptable at the time. Because the dollar was pegged to gold, devaluing the dollar meant in effect increasing the value of gold in terms of dollars. This would represent a tremendous windfall to holders of gold. And gold, by and large, is owned by the rich.
At the time, the U.S. faced a significant chance of a Communist/Socialist revolution such as had been seen in several other countries. Class warfare was widespread, with armed violence between workers and management a common occurance.
Bullshit. In the 1930s Stalin's servants, Foster and Ford, ran for president, all the great and the good, the top intellectuals at the top universities, all fulsomely backed them, and of course they got votes down in the asterixs. In America the communist threat was always conspiratorial. Actual support by the actual working class was as near to nonexistent as makes no difference. In the 1870s there was in America working class movement bent on class warfare. It utterly discredited itself with murder, sabotage, and crime, and by the 1890s was dead as a doornail, never to rise again. Ever since then, socialism in America has been an elitist movement, composed of the children of the rich and powerful. --digsig James A. Donald 6YeGpsZR+nOTh/cGwvITnSR3TdzclVpR0+pr3YYQdkG dgflRx/7/dpa85Fuwux6fcCT/aaJHKjlLtPqXDNO 2jxFJfp/F0zYFH6XlMgbJ27tHh7BnwTMX+V/TULJW
From: "Anonymous" <nobody@remailer.privacy.at>
Even libertarian monetarists such as Milton Friedman agree that this is the proper approach when dealing with a depression.
Murray Rothbard's law number 17: all economists specialize in the field they suck most. Friedman is good in many areas, but he sucks in monetary stuff, so obviously he specialized in it. There is NOTHING libertarian in Friedman's ideas about money.
At the time, the U.S. faced a significant chance of a Communist/Socialist revolution such as had been seen in several other countries. Class warfare was widespread, with armed violence between workers and management a common occurance. Transferring a huge bounty into the hands of the rich would have inflamed the working class and risked plunging the country into chaos and revolution.
Oh, a socialist... ok, that's why you like Friedman when he speaks about money.
Confiscating gold was clearly the lesser of the evils.
ROTFL... Mark
participants (4)
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Marcel Popescu -
R. A. Hettinga