I recently took quite a bit of flak from those supporters of Ron Paul who disputed the account published in the New York Sun that the Congressman from Texas had advocated selling off some of the nation's gold to pay for its debts.
I was then and still am opposed to that idea on several grounds not the least of which is the idea that there is insufficient gold, even at the current market value, to make a serious dent in the gargantuan $14 trillion + debt burden of the US. That then begs the question as to which class of debtors would get the option of being paid in gold, US citizens who own the debt either directly or indirectly through investments made in pension funds or mutual funds, etc., or foreign creditors such as China who hold a tremendous amount of our overall debt.
First of all, who would make such a decision? Secondly, no matter which group was chosen, the other group was going to be provoked into an angry response. Certainly if China were snubbed in favor of our own citizens, they being our banker, the fallout would not at all be pleasant. If China were paid in gold and our own citizens left to be paid in a depreciating fiat currency, the noise of protest and outrage here at home would be deafening.
The main issue I have with selling our gold to pay off our debt is that it smells too much to me like a scenario in which a drunken spendthrift has run his family into the debt house forcing the unfortunate souls to sell anything they have left of value to extricate themselves from their prison. In our case however it is a prison imposed by the reckless folly and stupidity of the political class of this nation.
I see a future for gold in a revised monetary system and I believe that the US would be much better served by retaining our nation's gold holdings intact (whatever we happen to have left of those holdings is anyone's guess) rather than selling off such a precious asset.
I would love to get further into this topic but that is not my intention at this time. In the interest of fairness and to give credit where credit is due, the honorable Congressman from Texas has issued a statement on his website detailing his strong opposition to extending the debt ceiling. Let me say that this is Ron Paul at his best and he has my complete support when he makes a statement of such nature.
I would much rather see statements of this kind, followed up with action by a majority of Republicans in Congress, that would enforce a fiscal restraint on our reckless and dangerous spending, rather than any talk of potential gold sales.
Hats off to the Congressman for this one. From Dr. Paul's comments below:
Stop Raising the Debt Ceiling
The federal government once again has reached the limit of its legal ability to borrow money, meaning it cannot issue new Treasury debt without action by Congress to increase the debt ceiling limit.
Please be sure to read the entire set of comments by clicking here:
"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat
Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput
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