It’s been easy to tune out the chatter of the past couple of elections because the outcome seemed irrelevant. Whoever wins, their hands are tied by unmanageable debt and the limited spectrum of politically-feasible policy options. In fact, since whichever party is in office when the world falls apart will get the blame, it’s tempting to hope the worst of today’s hacks and clowns win, just to see them branded forever as this generation’s Herbert Hoover.
But just when I’ve almost completely left politics, Ron Paul pulls me back in. It seems that after years as an alternately patronized and ignored member of the congressional subcommittee that oversees the Fed, he’s built up enough seniority to run the subcommittee next year.
So the one guy who truly understands the abominations of fiat currency and central banking will be able to call hearings, interview witnesses on television, and generally force the predators to answer for their actions. He’ll be able to demand audits of Fed activities and US gold reserves, and make the rest of congress explain their opposition. He might not produce any substantive legislation, since the vast majority of both parties are still happily riding the paper money gravy train. But he’ll provide endless entertainment for folks who enjoy watching central bankers and their minions squirm. And he’ll generate a whole library of YouTube clips for the sound money blogosphere.
Here’s an excerpt from today’s Wall Street Journal on Dr. Paul’s ascendency:
Ron Paul’s Golden Opportunity
Who better to host the debate over sound money in Congress than the Fed’s most persistent critic?
By Seth Lipsky
One of the most exciting features of the new Congress is the prospect that the chairmanship of a House subcommittee that oversees the Federal Reserve will go to Ron Paul. Final assignments are still being worked out, and the leadership may yet shy away from giving the position to a congressman who doesn’t believe the Fed should exist. But Dr. Paul, an obstetrician, has been the ranking Republican of the Domestic Monetary Policy and Technology subcommittee, and tradition suggests he will be the next chairman.
This couldn’t come at a more timely moment, though Dr. Paul has been working his way up to the assignment for more than a generation.
I first met the congressman nearly 30 years ago, back when the physician-turned-legislator was emerging on the national scene as a member of the United States Gold Commission. The commission had been formed at the start of the Reagan administration to consider whether America, in the wake of the collapse of Bretton Woods, should move to sound money.
In the event, the committee recoiled from reform. But Dr. Paul wrote a dissent that made the case for gold and is still being read today.
At the time, the value of the dollar had recently plunged to less than 1/800th of an ounce of gold. The collapse was reversed by the pro-growth policies of President Reagan and by a Fed chairman, in Paul Volcker, of uncommon vision and courage. Momentum for a gold standard was hard to sustain when inflation was being brought down, if not conquered, by other means.
Right now we are experiencing an even more dramatic collapse of the greenback—this time to little more than 1/1,400th of an ounce of gold—and the issue has returned with a vengeance. The Fed is reacting to the dollar’s collapse with a campaign of quantitative easing. The plan is to cascade hundreds of billions of additional dollars into the economy on the theory that we need inflation. No doubt this kind of thing will, if Dr. Paul accedes to the chairmanship, come in for a good deal more focused oversight than the committee has provided under Democratic leadership.
Heretofore, the subcommittee has “basically been a committee that’s dealt with commemorative coins,” as Dr. Paul has put it. In a conversation with me on Monday, the congressman said that he intends to get into the question of monetary policy itself. He would start by bringing in to testify to the committee not only the Fed chairman, but some of the leading officers and economists of some of the regional banks in the Federal Reserve system.
More far-reaching still is the prospect that Dr. Paul might use the committee to open up the deepest monetary issues, pressing for audits of America’s gold holdings and of the Fed itself. At one point this week, the congressman’s book, “End the Fed,” ranked No. 2 on Amazon’s list of the best-selling business books dealing with money and monetary policy, ahead of volumes by such luminaries of the right and left as Milton Friedman, George Soros and John Maynard Keynes himself.
Most exciting is the prospect that Dr. Paul will be able to bring into the national conversation such figures as, say, Edwin Vieira Jr., the visionary lawyer who has become the sage of the idea of constitutional money. That’s a reference to the unit of account to which the Founders were referring when they twice used the word “dollars” in the Constitution, and which they codified in the Coinage Act of 1792 as 371¼ grains of pure silver, the same as in a then-ubiquitous coin known as the Spanish Milled Dollar, or its free-market equivalent in gold.
If Dr. Paul does accede to the chairmanship of the monetary subcommittee, he will, in but a few months, gavel it to order on the 40th anniversary of the summer in which President Nixon closed the gold window and brought an end to Bretton Woods. Yet a few weeks ago, former Fed Chairman Alan Greenspan himself, speaking at the Council on Foreign Relations, warned that “fiat money has no place to go but gold.” Even the president of the World Bank, Robert Zoellick, has just called for restoring a role for gold in the monetary system.
The great debate is finally starting up again. Who better to host it in Congress than the diminutive doctor who, more faithfully than anyone else on the Hill, has for more than a generation stood for the concept of sound money?