MARCH 17, 2009 --

Just in case there was a long line at the post office, March 13, I took something to read -- choosing, at random from a bookcase, the Vintage paperback (original price of $1.95) "The Paranoid Style in American Politics and Other Essays," by Richard Hofstadter.

I opened the book, at random, to the essay about the gold standard - silver fight in the late 19th century, told with reference to a free silver advocate, William H. Harvey (someone I do not recall hearing about in high school or college classes).

At p. 240 , I read about bank failures, factories closing down, high unemployment, lives ruined by sudden impoverishment. At p. 279, I read of a debate between Harvey and a "goldbug" who feared that abandonment of the gold standard meant transfer of wealth from the industrious to the idle.

Should we be surprised that we have updates of such happenings and fears today? If not, shouldn't we have learned from the past --or are we, instead, just repeating past mistakes, in modern form?

Today we use what is called "fiat" money, which is backed by the government, not gold or silver. Would the bailouts be possible if we
did not use "fiat" money? Is our current situation a variation of the 1890s -- let alone the 1930's --when it was thought that the "goldbugs" were aiming for, in terms of Federalist 57, the "ambitious sacrifice of the many to the aggrandizement of the few"?

LPR has also seen the suggestion that there are plans to demonetize fiat money, changing it for something else. Hmm.