Gold News

The Republicans Return to Gold

The changing role of a Gold Commission and the Gold Standard debate in Republican politics...

A GOLD COMMISSION may be added to Mitt Romney's Republican Party platform for the November 2012 elections, according to the Financial Times.

Such a Commission, writes Adrian Ash at BullionVault, was held under a previous Republican administration, slap-bang between the 1980 and 1984 elections in fact. So let's compare and contrast the Republican National Convention's platforms which straddled that Committee.

July 1980 – nine years after the United States formerly abandoned the Dollar's gold peg, and with inflation racing since then to hit untold peace-time rates near 15%, Ronald Reagan's platform actually make no mention of "gold" by name. Instead, the soon-to-win-office Republicans say that:

"One of the most urgent tasks in the period ahead will be the restoration of a dependable monetary standard—that is, an end to inflation.

"Unfortunately, Mr. Carter and the Democratic Congress seek to derail our nation's money creation policies by taking away the independence of the Federal Reserve Board. The same people who have so massively expanded government spending should not be allowed politically to dominate our monetary policy. The independence of the Federal Reserve System must be preserved."

Four years of power later, however, and after two deep recessions, and one Gold Commission – which found against a return to gold...

"The Federal Reserve Board's destabilizing actions must therefore stop. We need coordination between fiscal and monetary policy, timely information about Fed decisions, and an end to the uncertainties people face in obtaining money and credit. The Gold Standard may be a useful mechanism for realizing the Federal Reserve's determination to adopt monetary policies needed to sustain price stability."

So gold has its political uses. But they are subject to change. Especially when, as US Fed chairman Paul Volcker did in the years between those 1980 and 1984 manifestos, interest rates are raised sharply to beat back the inflation caused by elected government's deficit spending.

Buying Gold to build your own private Gold Standard today...?

Adrian Ash is director of research at BullionVault, the world-leading physical gold, silver and platinum market for private investors online. Formerly head of editorial at London's top publisher of private-investment advice, he was City correspondent for The Daily Reckoning from 2003 to 2008, and he has now been researching and writing daily analysis of precious metals and the wider financial markets for over 20 years. A frequent guest on BBC radio and television, Adrian is regularly quoted by the Financial Times, MarketWatch and many other respected news outlets, and his views from inside the bullion market have been sought by the Economist magazine, CNBC, Bloomberg, Germany's Handelsblatt and FAZ, plus Italy's Il Sole 24 Ore.

See the full archive of Adrian Ash articles on GoldNews.

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