[green and blue are clinking champagne glasses, looking happy]
[green]
Finally!
We’ve defeated fascism, they are removed from power!
[blue]
What a struggle that was, time to celebrate
[green, looking confused]
Now let’s do everything in our power to return society to the exact state it was in right before fascism
[blue, arms crossed, smiling smugly]
Surely this won’t also reintroduce the conditions which gave rise to fascism in the first place
[both green and blue are now half-smiling half-scared, sweating a bit as the background gets darker]
https://thebad.website/comic/statu_quo_ante_fascism_fear_of_radical_change
How does tying the world’s economic productivity to the amount of shiny rocks currently unearthed help anything? There were constant financial panics under the gold standard.
That’s fair, it’s certainly not ideal. It’s hard to think of a resource that you can tie the dollar to without creating rushes or panic. However, our current system of loaning money into existence leads to massive debt and affordability issues from the resulting inflation. Have you come across any alternative suggestions that seem potentially viable?
I’m not sure I agree that was have problematic debt or affordability issues — at least not ones that artificially constraining the money supply would solve.
There are short-term cost price inflation problems like the cost of eggs due to an avian cull after a bird flu outbreak. That’s not a problem caused by printing money.
Ditto oil shocks. An affordability crisis unrelated to money supply.
Then we get to long-term affordability problems like housing. Housing is expensive due to policies that constrain new construction (NIMBYs) like parking requirements, supposed environmental concerns (on dense urban infill construction?) and the like.
But what makes housing really expensive is the financialization of homeownership. 100 years ago, if you took a loan on a house, the term was typically five years. The concept of a mortgage then was more like the concept of a title loan today. There’s remnants of this idea today in the game Monopoly — you buy a home cash, and if you run out of cash you mortgage the property — get some quick cash but sign the income over to the bank until you pay off the mortgage.
Now with 30 year loans, you’re really just renting your house and the bank is the landlord. But the 30 year loans jacks up the sale price which benefits the seller, the realtor, the broker, the city/state/whatever that collects property tax and the bank that actually owns the home until you pay it off.
Again, not a problem of money supply.
I’d challenge anyone who thinks the gold standard is a solution to read any book on modern monetary theory (MMT) and tell me they still think so after. Stephanie Kelton is a great MMT theorist.
In a nutshell, MMT says that the only constraint on a fiat currency issuer’s ability to print money is their tolerance for inflation. Which I don’t think gold bugs would like but would be forced to agree with.