2020 politics

[e-dub]

2 hours ago, ruraljuror said:

I understand that you 'feel' the opposite, Titanhog, but can you provide examples of what Obama did that you thought was so decisive?  It seems to me that Obama went out of his way to be a centrist.

Following the financial collapse, Obama endorsed (then enacted) Sarbanes-Oxley, which was a bi-partisan piece of reform legislation and much, much less proactive than what most progressives were advocating for. Similarly, Obama's signature legislative achievement (the Affordable Care Act) was based on a conservative/Republican healthcare reform concept that was conceived by the American Enterprise Institute (I believe) and had previously been enacted by a Republican Governor (Romney). Obama was caricatured as a leftist radical, but his policies were actually very moderate and rooted in compromise. 

What was it that Obama did that was so divisive?

Also, if you want to talk about the what happened to the good old days when Republicans and Democrats compromised, you're going to have to address the Hastert rule, which was implemented by Republican Speaker of the House Dennis Hastert and was the first time that a congressional leader decided that he wouldn't bring a piece legislation on to the House floor for a vote unless it had majority support from his own party. I would argue that was pretty much the end of bipartisan compromise right there, though I'd love to hear a counterargument to the contrary if you've got one. Also, let's not forget (then) minority leader Mitch McConnell's quote when Obama got elected: "The single most important thing we want to achieve is for President Obama to be a one-term president." That seems to me like it might be the cause of some division right there. 

Also, you say "Trump is what you get" and that Trump is a 'counter punch' that's just as wild, but that is removing a lot of agency from Republican voters who nominated and elected him, and continue to support him in record numbers. Trump may have been a registered Democrat (I have no idea) and I'm equally perplexed about why you think Democrats have loved him forever (I'd be curious to see what has given you this impression),  but the Democrats certainly never elected him to anything - he was just a real estate developer, failed casino magnate, and (later) reality TV star who got a lot of tabloid coverage. He was certainly never the Democratic choice for "leader of the free world" so I think your argument here is a bit of a stretch here to say the least.

More importantly, even if Obama had been evil incarnate - how on earth would that justify electing somebody even worse as payback? That's worse than playground logic. That's not just 'wer'e mad so we're taking our ball and going home' - that's 'we're mad so we're taking our ball and we're blowing up the whole basketball court so no one can ever play this stupid game again.' I've read enough of your comments over the years and have seen enough common sense and reasonableness in most of your posts that I have a really hard time believing that you actually support this nonsense.  To quote...you actually... "Clean it up!"

But, to get back to the point really. What was it that Obama did that you thought was so divisive? 

 

That was courtesy of the Heritage Foundation.

[ruraljuror]

4 hours ago, Armacing said:

Great, so what is your opinion about Executive Order 6102 ?

Well, first I had to look up Executive Order 6102 - so I guess I  couldn't really say that I have too strong of an opinion about it...

I assume that you're more interested in the gold standard generally as well as the federal reserve's ability to print money than you are interested in the executive order itself (though correct me if I'm wrong), and given that I've gathered this is a major area of interest for you, I'm much more interested in what you have to say about it than I am in providing my own half-baked thoughts.  I do think that currency and the means by which we store wealth are very interesting topics on a philosophical level, but I've never been that interested in the subject matter from a practical standpoint and haven't spent much time thinking about it as a result, so I'd be very interested to have you to take me to school and teach me a thing or two on these issues if you don't mind sharing.

That said, to avoid burying the lede here - I'm not a goldbug (though I know some very smart people who are) and I think the gold standard had outlived it's relevancy by the time we did away with it. To me, storing wealth in precious metals (or currency backed by precious medals) has always seemed a little primitive, but without the actual advantages that even more primitive mediums have for the storage of wealth and value.

To be clear, I think you're right that gold is a good investment - but that's not because gold is (or at least should be) a good medium for wealth/value storage.  Gold is a good investment because other people think it's a good investment, which then becomes a self-fulfilling prophecy, as in all markets.  The greater the amount of economic uncertainty (and the more that the Fed keeps printing money like there's more tomorrow) the more people will be driven to buy gold, which in turn will drive up the price ultimately becoming a really hot commodity if/when people start contemplating the possibility that the dollar could actually collapse one day.  In the event that the dollar actually does collapse, however, that would likely mean we've entered a global depression on a scale that we've never encountered before, and I'm not sure what good that gold would actually do for anybody. If you just have electronic credits representing that gold, then the real storage system is just bits of data on servers that represent gold ownership, not the gold itself, and I'm skeptical that the bits of data on those storage system are going to be redeemable if the global economy collapses. The other option of course is actually maintaining a stockpile of physical gold, but that's not ideal either given that it's cumbersome and would either be subject to thievery - and who really cares about trading or buying gold anyway in the event of a worldwide depression other than opportunistic speculators paying fractions of penny's on the dollar. As I see it, there would be a lot better mediums of storing wealth/value than gold in such an event, which brings me back to the even more primitive options like livestock, pelts, tools, and...you know...promises. If the dollar collapses, I'm going to feel a lot more secure if I've got a goat and a couple chickens than a briefcase of gold bars buried in the backyard.

With that out of the way, I will say that I think the major downside of getting off the gold standard (as I see it) is that the Fed can print its heart out - I'd imagine that's one of your major complaints here and I think that's a totally fair complaint. That said, we do have some control over Fed practices (political pressure, historic/tested monetary policy decisions/results, appointment of leaders), while on the other hand we have absolutely no control over what mother nature and/or science does in terms of the gold supply. Who's to say whether or not we find endless amounts of gold just a bit further down than we've ever gone before in the Marian Trench, and just because the alchemists didn't figure out how to how to turn Copper (or whatever) into gold doesn't mean that some scientist won't figure it out one day.  Of course I don't think these scenarios are likely, but my point is that the amount of gold in existence is unknown and arbitrary, whereas we have a much better idea about how many dollars are in circulation, and I think it's possible that we may be better off retaining the ability to adjust the amount of dollars in circulation to respond to national economic needs than being subject to circulation amount variables like how much we were able to dig out of the ground or collect from melting down estate jewelry in a given year. 

I do recognize I could be way off base about these lines of thinking with any/all of this.  I'll also say, as I assume you agree, that the Fed has done more than its fair share to funnel money upward to the wealthy over the years, often (if not exclusively) at the expense of those who have less wealth to begin with. That said, without better reason, I'm in the 'better stick with the devil you know than the devil you don't' camp on this one. We've seen how successful the wealthy can be at influencing fiat currency markets in their favor, but I'm not sure that they wouldn't be even more successful at manipulating the gold market.

In any case, I'm curious to hear what your thoughts are on this stuff - I'm sure I'm missing boatloads of nuance to say the least, but it's certainly interesting to think about. 

Edited August 10, 2020 by ruraljuror

[Armacing]

10 hours ago, ruraljuror said:

Well, first I had to look up Executive Order 6102 - so I guess I  couldn't really say that I have too strong of an opinion about it...

I don't know... I would say you have about the average level of opinion on the issue based on your multi-faceted response above... and a better-than-average understanding of the present-day dynamics of fiat currency.

I was curious about your opinion on the following:

1) We were discussing crazy presidents and crazy policies, what do you think about an executive order demanding that all private citizens hand over all of their wealth (except for $100) in exchange for government-issued currency?  Before you craft your response, please try to be cognizant of the fact that up to that point in history gold and silver were the primary means of storing wealth and the ultimate reserve money.  Gold is where people went for safe haven when banks and governments couldn't be trusted, and that safe haven was taken away at the stroke of a pen.  If you can't wrap your head around that, try to imagine a present-day scenario where Trump issues an order that all 401K stock holdings be transferred to the federal reserve "for safe keeping in order to prevent panic-selling that will damage the market".  As a replacement, everyone's 401K would be re-filled with US dollars.

2) How do you like the fact that this executive order that resulted in the prosecution and imprisonment of peaceful american citizens, who's only "crime" was trying to save their wealth from the confiscatory behavior of a rogue president, was promulgated upon the American people under the auspices of the "Trading With The Enemy Act".  Think about that for a second... who is the enemy of the US government in that scenario?  Everyone who owned gold?  Everyone standing in the way of the US government's unilateral take-over of the money supply?

I will address your ancillary comments in a later e-mail, but I would like to get your reactions to the two points above first...

[ruraljuror]

3 hours ago, Armacing said:

I don't know... I would say you have about the average level of opinion on the issue based on your multi-faceted response above... and a better-than-average understanding of the present-day dynamics of fiat currency.

I was curious about your opinion on the following:

1) We were discussing crazy presidents and crazy policies, what do you think about an executive order demanding that all private citizens hand over all of their wealth (except for $100) in exchange for government-issued currency?  Before you craft your response, please try to be cognizant of the fact that up to that point in history gold and silver were the primary means of storing wealth and the ultimate reserve money.  Gold is where people went for safe haven when banks and governments couldn't be trusted, and that safe haven was taken away at the stroke of a pen.  If you can't wrap your head around that, try to imagine a present-day scenario where Trump issues an order that all 401K stock holdings be transferred to the federal reserve "for safe keeping in order to prevent panic-selling that will damage the market".  As a replacement, everyone's 401K would be re-filled with US dollars.

2) How do you like the fact that this executive order that resulted in the prosecution and imprisonment of peaceful american citizens, who's only "crime" was trying to save their wealth from the confiscatory behavior of a rogue president, was promulgated upon the American people under the auspices of the "Trading With The Enemy Act".  Think about that for a second... who is the enemy of the US government in that scenario?  Everyone who owned gold?  Everyone standing in the way of the US government's unilateral take-over of the money supply?

I will address your ancillary comments in a later e-mail, but I would like to get your reactions to the two points above first...

 

1a. First, I thought we were talking about recency bias in relation to ignorant and corrupt presidents, not crazy presidents with crazy policies. I don't bring up that distinction to split hairs, but I did want to note that FDR was certainly not ignorant. Whether or not he was corrupt is up for debate I suppose, but I would define corruption as using the powers of government toward the specific goal of enriching oneself, one's family, and/or one's friends and allies - and I don't believe FDRs actions here meet that definition. I also don't think either FDR or his policies were crazy, but more on that below.

1b. I could be wrong, but I think you're somewhat mistaken about how the gold collection actually happened. It wasn't that people had to turn over all of their (gold) wealth except for $100, it was that they had to turn over all gold coins and certificates with a value greater than $100. In effect, if a person's entire supply of gold was in gold coins valued at $50 dollars apiece, then they could have legally kept the whole stockpile. This is a very different standard than turning over all of your wealth except for $100 dollars of gold in exchange for government-issued currency, as you framed it. But, as I said, I could be wrong here so I'd appreciate a fact check if that's the case. 

1c. I am cognizant of the fact that gold and silver were the primary means of storing wealth at the time, but that doesn't mean that precious metals are actually a good medium to store wealth (as noted in my previous post) or that the gold standard was a good monetary policy that could have carried us through a rapidly modernizing world. Heroine used to be the most prescribed pain killer and lobotomies and electric shock therapy were once leading treatments for psychoses - just because an idea is widely adopted doesn't necessarily mean we should never reevaluate that idea in pursuit of a better one. 

I should also note that gold may have been the dominant means of storing wealth, but it was still a fiat currency - it could have just as easily been nickel or aluminum...or stamped horseshoes or bottle caps or endorsed sticks. Prior to electronics and medical advancement, what was gold even good for? Maybe some primitive dental fillings, but mostly it was just another shiny rock that had value because people believed it had value, and there was a market for it because people like shiny things and the wealthy/monarchs used it extensively in home decor. Point being, I don't think such a primitive wealth storage medium (especially one based on a luxury good market) would've been able to last much longer in the modernizing world and would likely have become a hindrance to our country had we tried to stick with it much longer anyway. River travel/shipping became way less important when we built railways, which in turn became way less important when we built highways. Thus is the nature of progress, and the gold standard was never going to be able to keep up because it is inherently arbitrary and inefficient. 

1d. All that said, would I have been angry and nervous about FDRs executive order had I been alive at the time - the answer is probably yes. Change is scary to say the least and there were no guarantees how this policy would ultimately play out at the time.

That said, FDR wasn't flying blind on a wing and a prayer here. Great Britain had enacted a very similar policy a couple years prior to FDR's executive order, so he had a pretty good example to work from to make sure this wasn't going to be a catastrophe. And he was right. Not only was it not a catastrophe, but we were able to start pulling our country out of the Great Depression and ushered in one of the greatest eras of economic growth and prosperity in the history of the world. 

1e. To your example of the hypothetical Trump 401k executive order - yes that would certainly scare me, too. A lot. 

That said, I'm actually sympathetic to the idea that maybe 401k holdings shouldn't include stocks in the first place, so it's not necessarily the hypothetical policy that would scare me. It would be the change itself that would scare me (as noted above) and even more importantly it would be the one proposing the change (Trump, in this hypothetical) and his motivations for proposing such a change that would really terrify me. 

In his first presidential election (less than a year before signing the executive order in question, I believe) FDR had won the electoral college 472 to 59 - so he was coming into office with a very different sort of mandate than Trump has ever had. And after ending the gold standard, FDR's approval rating actually kept climbing over the next 8 years or so between 60% and 70% approval, and that's before it went up even more when we rallied around the flag for WWII. Point being, one of FDR's goals was to increase trust in banking and government generally, which he was able to successfully deliver for the vast majority of citizens. He started in a position of trust and then he took actions to build upon that trust, which is part of the reason he was successful in his endeavors. Trump on the other hand has lost support since his much more closely contested election to the presidency, and, in short, I don't think there's much of a comparison to be made between the two here, so this hypothetical analogy falls a little short with me on those grounds if nothing else.

2a. I don't actually know anything about the Trading with the Enemy Act or how it was used to round up gold hoarders, but I'll take your word for it. You can maybe enlighten me here so that I have a deeper understanding of your primary grievance, but the scenario you depict doesn't sound all that different than laws against hoarding/price gouging water in areas that have just suffered a natural disaster. I can imagine similar prosecutions if people were hoarding ventilators or PPE during the early coronavirus days. That said, we would probably agree that there are some gray areas in hoarding and price gouging laws that are difficult to square with open markets and capitalism in general, but I've never been able to come up with either a better solution or a better way of understanding the dynamics at play, and I can't say that I've ever shed a tear when an opportunistic price gouger gets in trouble with the law.

2b. Again, you can educate me here if I'm off base, but I think you're overplaying the fact that the law in question is called the 'Trading with the Enemy Act' in terms of trying to define who the enemy is in this scenario. The naming of laws is pretty irrelevant compared to what's contained within them and it's probably not even necessary for a specific enemy to be named or even traded with to violate that code (though that's pure speculation on my part). As an example of what I mean, my guess is that if the US decided to ban the holding or usage of cryptocurrencies, then people who fail to divest their Bitcoins might find themselves in violation of the Trading with the Enemy Act too - not because they've actually made a trade with any enemy, but because they've maintained an outlawed wealth storage medium through which they could make a trade with an enemy, and that alone is probably a violation of the law. Similarly, if we'd outlawed Russian rubles during the cold war and an American was found to possess a bunch in an off-shore account, I can understand how that would have been a de facto violation of the law even barring evidence of any intent to actually trade with the enemy. As I said though, that's pure speculation on my part and would require a deeper dive into an old law than I'm interested in doing at the moment, but feel free to correct me or fill in the gaps if I'm wrong. In any case, I'd certainly agree that there are plenty of old laws still on the books with plenty of unconscionable provisions that have been misused and/or abusively applied - whether or not the Trading with the Enemy Act is one of them, however, I couldn't say.

That's all I've got - right or wrong I hope some of that at least sheds a little light on a counterpoint perspective to some of your opinions.

Edited August 10, 2020 by ruraljuror

[Armacing]

 

3 hours ago, ruraljuror said:

1b. I could be wrong, but I think you're somewhat mistaken about how the gold collection actually happened. It wasn't that people had to turn over all of their (gold) wealth except for $100, it was that they had to turn over all gold coins and certificates with a value greater than $100. In effect, if a person's entire supply of gold was in gold coins valued at $50 dollars apiece, then they could have legally kept the whole stockpile. This is a very different standard than turning over all of your wealth except for $100 dollars of gold in exchange for government-issued currency, as you framed it. But, as I said, I could be wrong here so I'd appreciate a fact check if that's the case. 

 

Let's say that you're 100% correct... it is of no consequence.  You still haven't given your opinion on the idea of a president issuing an executive order that forces peaceful citizens to turn over their metal wealth to the government , under threat of criminal prosecution,  in exchange for a federal paper currency.  Are you in favor of that or against it?

3 hours ago, ruraljuror said:

1c. I am cognizant of the fact that gold and silver were the primary means of storing wealth at the time, but that doesn't mean that precious metals are actually a good medium to store wealth

Not a good medium to store wealth?  If gold is of no practical importance, then why was the US government so keen to get their hands on it, can you tell me that?  Why not just ignore it completely?  I can't wait to hear your answer to this...

3 hours ago, ruraljuror said:

the gold standard was a good monetary policy that could have carried us through a rapidly modernizing world.

So the fact that the entire industrial revolution occurred in a world that was using the gold standard means nothing to you?  What was so special about 1933 that all of a sudden the world became so *modern*?

3 hours ago, ruraljuror said:

Heroine used to be the most prescribed pain killer and lobotomies and electric shock therapy were once leading treatments for psychoses - just because an idea is widely adopted doesn't necessarily mean we should never reevaluate that idea in pursuit of a better one. 

So then is it your contention that fiat paper currency is a better form of money than gold and gold-backed currencies?

3 hours ago, ruraljuror said:

I should also note that gold may have been the dominant means of storing wealth, but it was still a fiat currency

Sorry, got to stop you there...  I just took 5 seconds to google the words "Fiat Currency".  Here is the first result:  "Fiat money is a government-issued currency that isn't backed by a commodity such as gold."

So no, you just happen to be plain wrong.  Gold is not a fiat currency because the definition of a fiat currency is a currency that is not backed by gold.

3 hours ago, ruraljuror said:

Prior to electronics and medical advancement, what was gold even good for?

Hmm, not sure if you're being serious here or not.   I'll give you the benefit of the doubt and assume this is a genuine question:   Gold has been used by humans as a store of wealth throughout human history due to it's unique characteristics.  It doesn't readily react with other elements (except for a few special combinations of acids, notably of hydro-chloric and nitric acid  called "aqua regia") and it has a unique color that is easily identifiable even by the uneducated.  Historically, gold was mainly found in its pure metallic form in nature due to its non-reactive properties.  So unlike iron or copper or silver, gold didn't tarnish or otherwise dissolve into the environment around it.  Secondly, gold is inherently limited in quantity on earth, and in the universe at large do to it's high atomic number.  Thus, it is always scarce, and not easily inflated by the introduction of new supply into the economy.   Contrast this with Aluminium, that was at one point more valuable than gold, but then precipitously dropped in value when an economical method for extracting it from compounds was developed.  So rather than being limited in supply by human technology like Aluminium was (Aluminium being the most common metal in the earth's crust), gold is actually limited in quantity by the laws of physics.  Another way to say this is that gold's scarcity is an inherent quality of the universe.  Gold is also very malleable,  so it's relatively easy to work it into jewelry or ornaments.  But perhaps more important than all of these intrinsic attributes is the cultural significance of gold in human society.  Economics is the study of human action, and I have yet to find a single human who places no value on gold, even if it has practically zero  applications in everyday life.

3 hours ago, ruraljuror said:

Point being, I don't think such a primitive wealth storage medium (especially one based on a luxury good market) would've been able to last much longer in the modernizing world and would likely have become a hindrance to our country had we tried to stick with it much longer anyway.

So how was gold a "hindrance to our country?"  Specifically:  How was the fact that individuals in society owned gold a hindrance to society at large?  Let's make it personal... let's say I own some gold.  How does that hinder you?

3 hours ago, ruraljuror said:

Thus is the nature of progress, and the gold standard was never going to be able to keep up because it is inherently arbitrary and inefficient. 

So then is it your contention that the money supply created by the federal reserve is non-arbitrary and efficient?

3 hours ago, ruraljuror said:

1d. All that said, would I have been angry and nervous about FDRs executive order had I been alive at the time - the answer is probably yes. Change is scary to say the least and there were no guarantees how this policy would ultimately play out at the time.

I trust you would say "change is scary" to any party that has their wealth/land/freedom/life taken from them by government edict?  "Sorry native americans, you need to leave, this is our land now... I know change is scary, and there are no guarantees how this will play out".  Sorry Jews in Germany, you need to get on this train now and head for a new camp we set up for you in Poland... I know change is scary and there are no guarantees how this will play out".  <--- That's you.  That's what you sound like.

3 hours ago, ruraljuror said:

That said, FDR wasn't flying blind on a wing and a prayer here. Great Britain had enacted a very similar policy a couple years prior to FDR's executive order, so he had a pretty good example to work from to make sure this wasn't going to be a catastrophe. And he was right. Not only was it not a catastrophe, but we were able to start pulling our country out of the Great Depression and ushered in one of the greatest eras of economic growth and prosperity in the history of the world. 

Ah yes, I know all about what England did... they were the first ones who got desperate enough to rob their own citizens.  Were Americans too optimistic at the time to think it couldn't happen here?  Perhaps.

I like how you use the phrase "pulling our country out of the Great Depression".   Do you know what caused the great depression?  The federal reserve - the very entity that you think is saving the us from economic ruin was the actual cause of economic ruin.  But let's forget all of that and assume you are correct and that confiscating gold from private citizens was the key to ushering in "one of the greatest eras of etc...".  Does that mean that your great era is based on simple theft?  Does it mean that the secret sauce that FDR unlocked was simply taking property from one person and giving it to another?  Are you sure that Ghengis Khan or the Roman Empire or some other ancient empire wasn't more wealthy on an inflation-adjusted basis?  Because those guys were masters a conquering countries and taking people's gold at the point of a sword... forgive me for thinking that wealth was "created" differently in America.  But what I'm hearing from you is "No, actually the key to economic prosperity in America is based on taking gold away from private citizens."  Right?

3 hours ago, ruraljuror said:

1e. To your example of the hypothetical Trump 401k executive order - yes that would certainly scare me, too. A lot. 

And... so what... you would eventually come around to the idea 50 years later when everyone forgot about the stocks you lost as a result of Trumps executive order?  You just go along with whatever the experts tell you, huh?  Maybe if Trump takes everyone's 401K holdings it will usher in the greatest era of prosperity ever seen on planet earth... do you think?   Whatever the government takes from you via executive branch edict, it must be for the greater good, right?  That's what I'm hearing from you in the above sentence because you say you would be scared but you don't say you would be opposed to it.

3 hours ago, ruraljuror said:

That said, I'm actually sympathetic to the idea that maybe 401k holdings shouldn't include stocks in the first place, so it's not necessarily the hypothetical policy that would scare me. It would be the change itself that would scare me (as noted above) and even more importantly it would be the one proposing the change (Trump, in this hypothetical) and his motivations for proposing such a change that would really terrify me. 

Woah,  I just jolted to reality for a second there and realized I may be talking to someone who doesn't know what a 401K is.... I better double check this:  401K's are a savings account for retirement where the idea is you add your income before taxes, and then you earn a return on that investment and pay taxes when you withdraw at a later date.  Pop quiz:  What is the interest rate currently on cash balances?  And what is the Federal Reserve's target inflation rate currently?  After you put those two numbers together, let me know if your only concern in that scenario is  still just Trumps motivations.

3 hours ago, ruraljuror said:

Trump on the other hand has lost support since his much more closely contested election to the presidency, and, in short, I don't think there's much of a comparison to be made between the two here, so this hypothetical analogy falls a little short with me on those grounds if nothing else.

I don't care about Trump, I think he's an idiot.  I was just giving you a present-day example to help you understand (not sure if I was successful).  I think FDR's actions were criminal on the face of them.  No comparison to other presidents past or future is needed.  We're talking about outright theft, breaking his oath to protect Americans.  We're talking about disregarding the US constitution, which says " No state shall... coin money, emit bills of credit, make any thing but gold and silver a tender in payment of debts".   We're talking about using executive decree to take over the entire economy.  It's hard to find a more significant event in the history of America where the administration diverged so disastrously from the core principles that the United States were founded on.  Is this what George Washington and other revolutionaries fought for in the 1770's?  A government that would forcibly confiscate wealth from its own citizenry for the purpose of setting up the largest ponzi scheme in history?

 

3 hours ago, ruraljuror said:

2a. I don't actually know anything about the Trading with the Enemy Act or how it was used to round up gold hoarders, but I'll take your word for it.

There's a really good Wikipedia article on it, if you have the time to read it. https://en.wikipedia.org/wiki/Executive_Order_6102

3 hours ago, ruraljuror said:

2b. Again, you can educate me here if I'm off base, but I think you're overplaying the fact that the law in question is called the 'Trading with the Enemy Act' in terms of trying to define who the enemy is in this scenario. The naming of laws is pretty irrelevant compared to what's contained within them and it's probably not even necessary for a specific enemy to be named or even traded with to violate that code (though that's pure speculation on my part).

Here's the best education I can muster on this issue:  FDR used a hold-over War Powers act from WW1 to orchestrate the domestic seizure of the assets of private American citizens, without due process, by executive edict.  In summary, a law that was originally intended to protect the American people from foreign enemies was used against the American people to protect the US government from credit default and the inevitable regime change that would have followed.

3 hours ago, ruraljuror said:

That's all I've got - right or wrong I hope some of that at least sheds a little light on a counterpoint perspective to some of your opinions.

And I truly thank you for giving what you gave... looking forward to hearing your responses to my follow-up questions/comments above!

Edited August 10, 2020 by Armacing

[Nashvillain]

^Um...I know this is a conversation between Armracing and ruraljuror, but I wanted to jump in and offer a quick rebuttal on issuing paper money. The Article 1, Section 10 which forbids states from issuing bills of credit or making anything but gold and silver legal tender is referring to the States of the United States. Not the federal government. I'm not a constitutional scholar, but this reading is entirely consistent with the wording and layout of the rest of the Constitution, and I believe it would take a willful misreading of the document to think the above is meant to apply to the federal government. Furthermore Section 8 gives Congress the power to "...borrow Money on the credit of the United States...; to coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures....

Anyway, I'll tune in later. Have a nice day everyone. So glad we got this politics thread. Do we get to say mean things about Nashville here? 

Dammit. Actually, gold as a currency is arbitrary. Nothing you said above about its fantastic properties of shininess and prettiness negates the fact that it doesn't actually do much. Therefore, its basis as a currency is arbitrary, because every currency is arbitrary--it only has value because just about everyone agrees that it has value. If we all got together and decided to stop coveting shiny gold, poof, no more value. In a parallel timeline, maybe dog poop is gold. That's how currency works. As opposed to the barter system where two parties would exchange goods that actually serve a purpose. Furthermore, paper money is probably more efficient because the value it represents is printed on it. No need to measure it, or bite it, or push it into the bank in a wheelbarrow. 

 

Edited August 10, 2020 by Nashvillain

[Armacing]

3 hours ago, Nashvillain said:

^Um...I know this is a conversation between Armracing and ruraljuror, but I wanted to jump in and offer a quick rebuttal on issuing paper money. The Article 1, Section 10 which forbids states from issuing bills of credit or making anything but gold and silver legal tender is referring to the States of the United States. Not the federal government. I'm not a constitutional scholar, but this reading is entirely consistent with the wording and layout of the rest of the Constitution, and I believe it would take a willful misreading of the document to think the above is meant to apply to the federal government. Furthermore Section 8 gives Congress the power to "...borrow Money on the credit of the United States...; to coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures....

So your're saying states were given the authority to decide what is legal tender within their borders?  And that their choices were limited to Gold and Silver, correct?  The text you referenced never mentioned paper money, so since I can tell from your comments that you are a staunch constitutionalist who adheres to a very literal reading of the document, I take it you believe the issuance of paper money is unconstitutional?  Also notable, the article you referenced mentions borrowing money, but nowhere does it mention confiscate gold and replace it with paper.  I think we are on pretty safe ground to say that FDR's executive order was unconsitutional simply by virtue of violating the 5th amendment " or be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation. "  You can't really say that giving former gold owners paper in place of gold was just compensation when the entire purpose of owning gold was to avoid owning paper.

 

3 hours ago, Nashvillain said:

Dammit. Actually, gold as a currency is arbitrary. Nothing you said above about its fantastic properties of shininess and prettiness negates the fact that it doesn't actually do much. Therefore, its basis as a currency is arbitrary, because every currency is arbitrary--it only has value because just about everyone agrees that it has value. If we all got together and decided to stop coveting shiny gold, poof, no more value. In a parallel timeline, maybe dog poop is gold. That's how currency works. As opposed to the barter system where two parties would exchange goods that actually serve a purpose. 

Yes, agreed, on the face of it, the selection of metal as a store of wealth is arbitrary.  Not sure why Rurualjuror views arbitrariness as a negative attribute in gold.  All the fantastic properties I listed are not intended to prove that gold was a non-arbitrary store of wealth.... but rather I was attempting to show that gold was a non-random choice for storing wealth.  Big difference.   His question was "what is gold even good for", so I laid out the reasons why it is a good choice for storing wealth in physical form.  To your point, different societies have valued different things like seashells or cocoa beans or whatever.  None of that changes the fact that people value gold.

 

3 hours ago, Nashvillain said:

^Um...I know this is a conversation between Armracing and ruraljuror,

It's not just between us, feel free to join in and comment on any points you see fit... the more the merrier!

 

3 hours ago, Nashvillain said:

Furthermore, paper money is probably more efficient because the value it represents is printed on it. No need to measure it, or bite it, or push it into the bank in a wheelbarrow. 

Sure, paper is lighter and easier to carry.  One could point out that it could also burn in a fire or rip or get soaked with water and lose it's structural integrity.  I would argue that none of that matters too much because a currency that doesn't hold it's value is pretty useless regardless of how easy it is to read or carry.  And paper money loses value at an astonishingly quick rate because he who controls the printing press is bound and determined to print as fast as possible.

Edited August 11, 2020 by Armacing
spelling

[Nashvillain]

2 hours ago, Armacing said:

So your're saying states were given the authority to decide what is legal tender within their borders?  And that their choices were limited to Gold and Silver, correct?  The text you referenced never mentioned paper money, so since I can tell from your comments that you are a staunch constitutionalist who adheres to a very literal reading of the document, I take it you believe the issuance of paper money is unconstitutional?  Also notable, the article you referenced mentions borrowing money, but nowhere does it mention confiscate gold and replace it with paper.  I think we are on pretty safe ground to say that FDR's executive order was unconsitutional simply by virtue of violating the 5th amendment " or be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation. "  You can't really say that giving former gold owners paper in place of gold was just compensation when the entire purpose of owing gold was to avoid owning paper.

Apparently. 

No, as I mentioned, I'm not a constitutional scholar. I was just refuting your claim that Section 10 had anything to do with the Federal Government's monetary policy when it was clearly proscribing States' abilities in this realm. 

Now, I must confess, I'm not sure why we're talking about this particular moment in history at all except that you raised it. But now you're making all sorts of assumptions about what I think about this EO just because I refuted your assertion that Section 10 has anything to do with Federal monetary policy and also that I quoted the relevant passages about Federal monetary policy. Pointing to evidence to illustrate where someone is wrong is not an affirmation of one's own view point.

As to your assumptions, this does seem like executive over reach. However, circumstances were quite extraordinary (the erasure of billions of dollars of wealth and assets/the collapse of the economy/massive unemployment/government insolvency) and people were compensated in the amount of the value of their gold (apparently). So it hardly seems like the most egregious example of executive over reach I can think of off the top of my head. But, forcing people to turn over their property is never a good look IMO. But it's been done probably thousands of times in our history in the form of eminent domain. 

Not only am I not a constitutional scholar but I'm also not an economist. Therefore, I can't speak to the rationale for abandoning the gold standard. I'm sure there are sound arguments for both, but it seems to me that economics isn't a hard science and is subject to the whims of human behavior and political behavior (and frequently subjected to ideology). Various systems can probably work to some degree but each would have advantages and disadvantages. But again, this isn't an axe I'm too keen on grinding

Edited August 11, 2020 by Nashvillain

[Tennessine]

On 8/9/2020 at 10:16 AM, JoeyX said:

Let's hope the grown man who watches way too many kids movies doesn't start deleting posts because of his tendency to get overly emotional.

Maybe he deleted your posts and banned your first account because you're a crappy poster. Most of your posts are inflammatory by disposition, such as the one I quoted. Hence is why your content gets deleted.

[Armacing]

13 hours ago, Nashvillain said:

Apparently. 

No, as I mentioned, I'm not a constitutional scholar. I was just refuting your claim that Section 10 had anything to do with the Federal Government's monetary policy when it was clearly proscribing States' abilities in this realm. 

I get what you're saying but at the time the constitution was written there was no such thing as a federal reserve bank or federal reserve note.  I think we need to read that wording in the context of how wealth was stored at the time, namely gold and silver.   The overall philosophical underpinning in that text is the idea that paper money should not be issued and only gold and silver should be used as a currency.  Why would the founders so explicitly ban only states from printing paper money only to turn around and have the federal government print paper money?  That line about "minting coin" also jives with this concept because that is gold and silver coin they are talking about.  You can try to use some kind of strict reading of the words to twist the meaning into supporting what FDR did, but that is ignoring the historical context and the underlying philosophical context completely.

 

13 hours ago, Nashvillain said:

Now, I must confess, I'm not sure why we're talking about this particular moment in history at all except that you raised it.

Any time is a good time to discuss the most significant event in the economic history of the US.   People bring up and discuss historical events and their impact on modern life all the time... I don't feel the need to discuss the "issues of the day" that are brought up by someone else.   To the contrary, when I see people blindly flailing about for answers about why things are so bad today, I feel compelled to educate them about how events that took place several generations ago were the root cause of the problems they are experiencing today.  Indeed, I consider it to be an essential weakness in democracy:  democratic societies are bad at dealing with issues where the impact of decisions is not felt until several generations later.  Democracy is a very instant-gratification type of endeavor in America.  4 or 6 year election cycles.  Not to mention the limit on human life span at about 70 years.  But often times human civilization is tasked with managing issues and systems so complex that the cause-and-effect feedback loop stretches beyond the lifespan of a voting human.  Thus younger generations can only hope to fully understand their plight by revisiting decisions that were made in the past (before they were born) and explore root causes.  It's never too late to right an historical wrong.

13 hours ago, Nashvillain said:

Pointing to evidence to illustrate where someone is wrong is not an affirmation of one's own view point.

Even if we say you are right and that passage only related to the states, why do you think the founders would want the federal government to to the exact thing they prohibited the states from doing?  I discussed this above, but I think with all things in the constitution, there is context and philosophy that must be taken into consideration when trying to understand the intent and the full scope of the founder's design.

13 hours ago, Nashvillain said:

So it hardly seems like the most egregious example of executive over reach I can think of off the top of my head.

Which one do you think is worse?  This was an authoritarian take-over of the entire economy.   Designed to create a vehicle whereby the savings of the entire nation could be looted by the federal government without the hindrance of needing to obtain the population's approval via the democratic system.  And it persists in that way to this very day - the Fed is "immune" from politics, supposedly.  And this aspect is often touted as a virtue.  Oh boy, am I supposed to feel good about that?  The entity that decides how much of my money they are going to take from me via inflation does *not* answer to me in the ballot booth.

13 hours ago, Nashvillain said:

But, forcing people to turn over their property is never a good look IMO. But it's been done probably thousands of times in our history in the form of eminent domain. 

Sure, eminent domain has happened, but I would say it's geographically isolated in scope and economically limited in impact.  And even then eminent domain process usually involves a trial where both sides get to argue their case.  With executive order  6102 we're talking about virtually the entire privately-owned gold supply in the whole nation being transferred to the FED by force.  I hope you can see there is really no legitimate comparison to eminent domain cases.    Also, you say "forcing people to turn over their property is never a good look".  Like, what the hell, man?  That is such a milquetoast response to obvious tyranny by the government.  If you're loaded on a train headed to the gas chamber are you going to complain about the lack of beverage service?  Where's the indignation?  Where's the outrage?  Your own government taking peoples property at the point of a gun to prop up failing bankers and your reaction is "never a good look"?  I don't get it.

13 hours ago, Nashvillain said:

Not only am I not a constitutional scholar but I'm also not an economist. Therefore, I can't speak to the rationale for abandoning the gold standard. I'm sure there are sound arguments for both

It doesn't take an economics degree to understand that if one person has gold, and another person points a gun at them and says "give me the gold", that is thievery.   I mean, it's very generous of you to see that scenario play out and say "I'm sure there are sound arguments" for why someone would steal gold from another person.  Me?  I tend to assume whenever a violent person initiates violence, unprovoked, against a peaceful person, that the violent party is in the wrong, until proven otherwise.   Do you do this with every historical atrocity?  Maybe you give Andrew Jackson the benefit-of-the-doubt that he had "sound arguments" for why the 5 civilized tribes needed to be forcibly herded into concentration camps and marched to Oklahoma?  

 

13 hours ago, Nashvillain said:

economics isn't a hard science and is subject to the whims of human behavior

Umm, economics *is* the study of human behavior.  Let that sink in... 

If human behavior is fickle, then economics is the study of how the capricious human mind deals with the asset-allocation decisions which all humans are forced to make (given that they live in a world with scarce resources).

13 hours ago, Nashvillain said:

Therefore, I can't speak to the rationale for abandoning the gold standard. 

Actually, we weren't even discussing abandoning the gold standard, which didn't happen until 1971 under Nixon.  We're talking about taking gold away from private citizens in the US and transferring it into possession of the Federal Reserve Bank.

Edited August 11, 2020 by Armacing

[Armacing]

13 hours ago, Nashvillain said:

I'm not a constitutional scholar.

13 hours ago, Nashvillain said:

I'm also not an economist. 

One more thing:  These quotes... this is part of the problem in America today.  People have been so brow-beaten by their "intellectual superiors" that they feel compelled to suspend their own faculty of judgement, ignore their own powers of observation, refrain from drawing their on conclusions, etc.  Thomas Jefferson was not a constitutional scholar when he wrote the constitution because there was no such thing.  He was just some guy in America who studied philosophy and had a whole host of other personality flaws, like all people do.  Yet, in spite of his imperfections, he felt confident in his judgement about the King of England and the British Empire, even though he had no experience being king or running a country.

Personally, I like the fact that you go out on a limb and argue an issue that you haven't studied.  We should all be getting involved in discussions about these types of issues and apply our own judgement to what happened in the past and what is happening in the present.  Thank you for contributing to this discussion!

[ruraljuror]

20 hours ago, Armacing said:

I put your (Armacing's) quotes in bold below to make it easier to respond without having to do a lot of quote editing.

Let's say that you're 100% correct... it is of no consequence. 

First, there's a huge difference between the seizing (and reimbursing) of all gold over $100 dollars of value per person, and the seizing (and reimbursing) of all denominations of gold/certificates $100 dollars of value or greater. This distinction is of great consequence as a practical matter. If we were talking eminent domain and real estate instead of gold seizure, the analogous situation would be the difference between the government saying that a person can own a maximum 10 acres total vs. the government saying that a person can own a maximum of 10 acres of contiguous property on a single plot (with no restriction on total land ownership of non-contiguous plots). These are not remotely similar degrees of government intrusion - that said, I do realize that the degree of intrusion isn't a major concern of yours so we can leave it at that, but that doesn't mean that the distinction is of no consequence.

You still haven't given your opinion on the idea of a president issuing an executive order that forces peaceful citizens to turn over their metal wealth to the government, under threat of criminal prosecution,  in exchange for a federal paper currency.  Are you in favor of that or against it?

Asking whether or not I'm in favor or against something that happened almost 100 years ago seems like a strange way to frame this discussion to me. Am I in favor of moving the seat of our federal government from NYC to DC? I don't know - never really thought about it in the present tense - but I don't have a problem with that decision and I guess I like the results. That's essentially how I feel about FDR's executive order - it happened, we're not going back, and it's probably for the best anyway - so I don't spend a lot of time worrying about it. Even if we broke the egg here, we can't unbreak it.

That said, if your main complaint is that it was a massive overreach on the government's part, I'm definitely sympathetic to that argument. But the main problem I see is more about the method by which the gold was confiscated/reimbursed than anything else. In my opinion, it would have been way better to incentivize citizens to willingly sell their gold to the government and/or to tax gold hoarding instead of using brute force to achieve the desired results. Of course, FDR's executive order was a much quicker way to achieve the desired results than my preferred methods, so I imagine that speed was a major factor in the equation, and I don't begrudge the decision given the severity and length of the Depression at that point. 

To be honest though, in terms of the many times and many ways that our government has overreached throughout history and done things that I think were incredibly messed up, this particular infraction is not very high on my list of grievances. That list starts out with the lowlights like slavery, the Trail of Tears, prohibition, the one-two puch of Japanese-American internment camps, Bush v. Gore, the mass surveillance of citizens in the Patriot Act...just to name some of the big ones. In fact, on that particular list of government outrages, FDR's executive order would probably be on the second tier of offenses along with things like using eminent domain to build the rail infrastructure. I may even be less outraged by the seizure/reimbursement of gold (which was applied to everyone equally) than the seizure/reimbursement of land for infrastructure (which was much more of a selectively applied burden), but that's just me.

Not a good medium to store wealth?  If gold is of no practical importance, then why was the US government so keen to get their hands on it, can you tell me that?  Why not just ignore it completely?  I can't wait to hear your answer to this...

Before getting to answering your question here, I'd like to note that your tone is pretty off putting here. I've gathered that this issue is a considerable source of frustration for you, but you're going to need to 'tone down' your tone if you want me to continue participating in these discussions.

With that out of the way, I need to apparently clarify that I didn't say (or at least I didn't mean to say) that gold is of no practical importance. What I said was that gold has no practical purpose beyond wealth storage if you exclude dental applications, electricity conduction, medicine, and being shiny - and most of those purposes are relatively new uses for gold in the grand scheme of things. Over much of history, gold mostly just looked pretty and was used as a value storage medium. 

To be clear, I don't mean to diminish what an important function gold has historically served as a means of storing value - that is a monumentally huge purpose. And when I say that gold isn't a particularly good medium for wealth storage, I am very wrong to ignore how well suited it is for wealth storage relative to other elements, compounds, or objects - you raised a lot of great points in support of that idea. 

BUT, what I do mean to say is that no metal (or any other material that occupies physical space for that matter) is going to be the best possible primary medium in which value can be stored. Being limited by physical space necessarily excludes gold from this distinction in my opinion.

I should also note that the dollar and other fiat currencies are not the best possible primary medium in which value can be stored either, but I think they're a step in the right direction away from gold and at the very least have one advantage over gold in that they can't be hoarded as easily - which brings me to the next point. To your question about why the US was 'keen to get their hands on' their citizens' gold instead of just ignoring it,' it's my understanding that people were hoarding gold because of the uncertainties of the Depression, but by keeping their gold out of circulation these people were actually prolonging the economic downturn, so the US government wanted to replace that hoarded gold with US dollars in order to break out of that cycle. I believe the thought was that forcing people to exchange their gold for US dollars and pulling gold out of circulation (since it wasn't circulating anyway) would eliminate the hoarding issue and it would enable the government to print more dollars and put them into circulation - which is exactly what the government then did through public works projects, which had the added benefits of giving people jobs, hope, and purpose which were in even shorter supply at the time than gold was.  I would also assume that the government getting its hands on most of the gold in the US would have had the effect of strengthening confidence in the dollar and US banks, in part by removing the competition - for better and for worse. But to me, none of that qualifies as 'crazy' economic policy enacted by a 'rogue president.' 

So the fact that the entire industrial revolution occurred in a world that was using the gold standard means nothing to you?  What was so special about 1933 that all of a sudden the world became so *modern*?

I described my understanding about why 1933 was the year we effectively ditched the gold standard above - the dramatic change in monetary policy was a response to the Depression, not some byproduct of rapid modernization.

That said, I do think as the world modernized that the limitations of the gold standard would have made it obsolete at some point or another. Sure it was good enough to get us through the Industrial Revolution, but so was the Arithmometer, coal-based power, and whatever the hell we used to treat bacterial infections before we had penicillin. Better technologies have (and will continue to) come along and replace more primitive ones, and wealth storage media are no exception.

So then is it your contention that fiat paper currency is a better form of money than gold and gold-backed currencies?

My contention is that there are some major advantages and major disadvantages to both of these options, but that the advantages of fiat currency led the US dollar to become the world's reserve currency and the value of the dollar and our national wealth has benefited greatly as a result. 

Sorry, got to stop you there...  I just took 5 seconds to google the words "Fiat Currency".  Here is the first result:  "Fiat money is a government-issued currency that isn't backed by a commodity such as gold."

So no, you just happen to be plain wrong.  Gold is not a fiat currency because the definition of a fiat currency is a currency that is not backed by gold.

I assumed that you were familiar with the term fiat currency already as it's often a buzzword among the anti-central banking goldbugs I know, so I was trying to use the term metaphorically in a way I thought would ring true to you. Sorry if I missed the mark, but I'll try to expound upon the idea that I was attempting to convey so it's less ambiguous.

I would define 'fiat currency' to mean a currency that has value because people believe that it has value. For example, I believe my one dollar bill has value because I am confident that I can go to the gas station and buy one dollar worth of goods. The gas station owner, in turn, has instructed his employees to accept my one dollar bill in exchange for 1 dollar's worth of goods because the gas station owner believes that he can then take my one dollar bill and use it to buy 1 dollar worth of goods or services for himself. The same process works for 100 dollar bills, except they exchange for 100 dollars of value instead of 1 dollar of value. Despite this discrepancy in value storage, however, the actual material they're printed on has exactly the same cost and exactly the same physical value apart from the ink/markings on the bill that state it's nominal and accepted value. In this sense, there is no (or very limited) intrinsic value to the dollar - which is what makes it fiat currency.

The analogy that I was trying to draw, as again reiterated above, is that gold itself didn't have much intrinsic value either in the sense that (prior to electronic and medical applications) gold didn't serve much of a purpose beyond decoration and value storage medium. Again, I think you're right that I wasn't fairly accounting for how well-suited gold was as a value storage medium relative to other options which I'm sure is why it it was so prominently used to store value for so long, but my point was to highlight how much more functional some other historic wealth storage mediums were: livestock can store value and produce offspring, milk, meat, and leather. Pelts store value and provide warmth. There are downsides to these even more primitive stores of value relative to gold too, of course (e.g. susceptibility to disease, decomposition, they occupy more physical space per unit of value, etc.) but when push comes to shove, these other value storage mediums intrinsically meet some of the most basic needs of humanity, whereas gold does not.

From a practical standpoint then, gold's main purpose was initially that it was good for decoration. You're right of course about gold's relative scarcity, chemical inertia, distinct color, malleability and all the other excellent attributes you addressed that made gold so effective at wealth storage, but I'd argue that gold never would've been considered as a wealth storage medium in the first place if there weren't a demand for decorative accessories. Gold has always been a luxury good in this sense, and the demand for luxury goods tends to require that all necessities are met first. To put it another way, there has been a demand for gold for as long as there have been people with enough wealth and resources already accumulated that they can set their sights on pursuing luxury. I'd contend that gold's true value then is based upon people's belief that there is and will always be a market for shiny things and decorations, meaning in effect that the value of gold is tied to the idea that there will always be people who've accumulated enough wealth to pursue luxury. 

Because the value of gold is rooted in this belief, it's also a fiat currency in a very real sense. It has disproportionately limited intrinsic functional value relative to the amount of value it stores in the market. And because the value of gold is then based upon the belief that there will always be people who've accumulated enough wealth to pursue luxury, I'm not so sure that belief (and in turn the value of gold) will hold up in the event of complete global economic catastrophe, when demand for gold in a practical sense could all but dry up entirely. Then again, I do concede it's possible that in such a scenario people would continue placing value in gold simply because of the long established historical precedent, but my supposition remains that a bag of crop seeds, a good axe, some chickens, or even a barrel of oil would all be preferable commodities to a gold bar if civilization were to truly collapse in on itself. 

Hmm, not sure if you're being serious here or not.   I'll give you the benefit of the doubt and assume this is a genuine question:   Gold has been used by humans as a store of wealth throughout human history due to it's unique characteristics.  It doesn't readily react with other elements (except for a few special combinations of acids, notably of hydro-chloric and nitric acid  called "aqua regia") and it has a unique color that is easily identifiable even by the uneducated.  Historically, gold was mainly found in its pure metallic form in nature due to its non-reactive properties.  So unlike iron or copper or silver, gold didn't tarnish or otherwise dissolve into the environment around it.  Secondly, gold is inherently limited in quantity on earth, and in the universe at large do to it's high atomic number.  Thus, it is always scarce, and not easily inflated by the introduction of new supply into the economy.   Contrast this with Aluminium, that was at one point more valuable than gold, but then precipitously dropped in value when an economical method for extracting it from compounds was developed.  So rather than being limited in supply by human technology like Aluminium was (Aluminium being the most common metal in the earth's crust), gold is actually limited in quantity by the laws of physics.  Another way to say this is that gold's scarcity is an inherent quality of the universe.  Gold is also very malleable,  so it's relatively easy to work it into jewelry or ornaments.  But perhaps more important than all of these intrinsic attributes is the cultural significance of gold in human society.  Economics is the study of human action, and I have yet to find a single human who places no value on gold, even if it has practically zero  applications in everyday life.

I was being serious, but I think I've addressed this stuff above already. I thought these were really good points that you made here.

So how was gold a "hindrance to our country?"  Specifically:  How was the fact that individuals in society owned gold a hindrance to society at large?  Let's make it personal... let's say I own some gold.  How does that hinder you?

I think I already addressed the benefits to pulling the majority of the gold supply out of circulation at the time, as well.  But to be clear, you owning some gold is a very different thing than allowing creditors to demand payment in gold, so I'm not sure what your point is here.  

So then is it your contention that the money supply created by the federal reserve is non-arbitrary and efficient?

I would say that the money supply is less arbitrary than the supply of gold in the sense that the supply is controlled by the federal reserve. The money supply is certainly more inconsistent but it is not arbitrary - it is set where it is set for a reason, and the ability to set the money supply is inherently more efficient because it is adjustable to meet the economic needs of the country. That said, the Fed has surely made plenty of mistakes about when and where it has chosen to add or remove dollars from the market, but the alternative is a system that led to the very situation in 1933 that brought about the end of the gold standard in the first place.

I trust you would say "change is scary" to any party that has their wealth/land/freedom/life taken from them by government edict?  "Sorry native americans, you need to leave, this is our land now... I know change is scary, and there are no guarantees how this will play out".  Sorry Jews in Germany, you need to get on this train now and head for a new camp we set up for you in Poland... I know change is scary and there are no guarantees how this will play out".  <--- That's you.  That's what you sound like.

At risk of stating the obvious, you're equating the exchanging of one wealth storage medium for another...to the Holocaust....And your also ascribing that opinion to me.  How do you think that makes you sound to me? It's certainly not a very persuasive or polite argument to make with someone who's doing you the courtesy of responding at length to these ideas that seem to be pretty significant to you.

Ah yes, I know all about what England did... they were the first ones who got desperate enough to rob their own citizens.  Were Americans too optimistic at the time to think it couldn't happen here?  Perhaps.

I like how you use the phrase "pulling our country out of the Great Depression".   Do you know what caused the great depression?  The federal reserve - the very entity that you think is saving the us from economic ruin was the actual cause of economic ruin.  But let's forget all of that and assume you are correct and that confiscating gold from private citizens was the key to ushering in "one of the greatest eras of etc...".  Does that mean that your great era is based on simple theft?  Does it mean that the secret sauce that FDR unlocked was simply taking property from one person and giving it to another?  Are you sure that Ghengis Khan or the Roman Empire or some other ancient empire wasn't more wealthy on an inflation-adjusted basis?  Because those guys were masters a conquering countries and taking people's gold at the point of a sword... forgive me for thinking that wealth was "created" differently in America.  But what I'm hearing from you is "No, actually the key to economic prosperity in America is based on taking gold away from private citizens."  Right?

Any wealth created in early America was done so on stolen land and with the the economic complicity of slavery at the very least. These are legitimate crimes to be outraged about if you want to stir up some anger regarding  American economic policies of yore. Further, I don't see the end of the gold standard as being theft, so you're losing me in the hyperbole here. And in any case, behind all great wealth was a great crime of some form or another, so yeah I do think you're a little off base that 'wealth was created differently in America" at least within the parameters of this debate, but that's kind of beside the point. 

You just go along with whatever the experts tell you, huh?... Woah, I just jolted to reality for a second there and realized I may be talking to someone who doesn't know what a 401K is. 

Honestly, what's with the attitude? - it's getting pretty tiresome and I'm not sure what I've done that makes you want to be snide. How would you like it if I responded Woah, I just jolted to reality for a second there and realized that I may be talking to someone who doesn't realize that stocks aren't the only investment vehicle that 401ks can be used to purchase...? I'm honestly not sure why you're addressing me with this tone, but I suddenly feel like I've gone too deep in a Youtube video comment section or a reddit thread, and it doesn't make me excited about the prospect of discussing this issue further. I think that'll do it for me in this response at least.

But to answer this one last question - yes, I do generally recommend listening to experts when formulating opinions. Experts are wrong about stuff and make incorrect analyses based upon incomplete or bad information a lot of the time, but not nearly as often as non-experts, which is what makes them experts. I will also repeat here that I am no expert on the gold standard, wealth storage media, or monetary policy - so everything I'm saying here could be dead wrong and it wouldn't surprise me in the slightest. 

All that said, I hope some of this was at least of some interest to you. And if you don't mind me asking a couple questions in return, what's your goal here? Just an airing of grievances? Do you want to revive the gold standard? Do you want to recruit more goldbugs to inflate the value? I'm participating in this discussion because I find it to be a somewhat interesting philosophical topic of debate, but it seems like this issue is really personal to you. Am I wrong about that, and if not, what's the story?

 

Edited August 11, 2020 by ruraljuror

[Rockatansky]

On 8/9/2020 at 2:31 PM, titanhog said:

Obama did more to divide the nation

The only divisive thing Obama did was be a Black guy who was elected President. On issues of policy he was decidedly centrist.

[Armacing]

1 hour ago, ruraljuror said:

These are not remotely similar degrees of government intrusion - that said, I do realize that the degree of intrusion isn't a major concern of yours so we can leave it at that,

Precisely, the degree of intrusion is of no concern to me.  If someone takes half of your land or half of your gold, does that make them right?  You have a very relativistic attitude towards tyranny.  Apparently there are not bright red lines for you morally, just a lot of gray areas that you are ready to go along with if the outcome is good for you.  Oops, sorry, doing that thing again where I ascribe opinions to you.  Seriously, if you disagree with me characterizing your opinions in a negative way using hyperbole or fanciful (though logically sound) analogies, why not refute them?  Let's be precise:  You are OK with a little government intrusion in the form of confiscating hard assets from the public, right?  Just state that plainly and own it.  Why beat around the bush?  Why not proudly declare "I believe that private property is subject to confiscation by the government based on presidential decree"?  Why is that so hard to say, rather than spending so many paragraphs exploring the myriad nuances of your mildly held belief on the subject?

1 hour ago, ruraljuror said:

That's essentially how I feel about FDR's executive order - it happened, we're not going back, and it's probably for the best anyway - so I don't spend a lot of time worrying about it. Even if we broke the egg here, we can't unbreak it.

But that's the thing.  It wasn't for the best.  You may find comfort in the belief that the *experts* decided what was best for you and you can live life without ever having to worry about the mean old gold hoarders or the arbitrary quantity of gold on planet earth.  You can even go ahead and enjoy a carefree existence because you are (hopefully) comfortably wealthy and your income always grows fast enough to keep up with inflation so that your standard of living never suffers.  My whole point here is a great evil was done by the government that day, and I also endeavored to help you break free from the lifetime of indoctrination you have been subjected to that made you think "it's probably for the best".  I've been through this argument 100 times with 100 people and heard the very responses you're giving me 100 times and they are all the same.  Nobody ever wants to have their world view shattered, and I get that.  So I don't expect you to be suddenly energized with the rage of a thousands angry squirrels and charge the steps of congress while chanting "Audit The Fed!".  I'm simply exposing you to the counter-argument to the official story the federal government and popular media give everyone on a daily basis.  Their message is "Nothing to see here, move along".  

 

1 hour ago, ruraljuror said:

Then again, I do concede it's possible that in such a scenario people would continue placing value in gold simply because of the long established historical precedent, but my supposition remains that a bag of crop seeds, a good axe, some chickens, or even a barrel of oil would all be preferable commodities to a gold bar if civilization were to truly collapse in on itself. 

Agreed, those things would be more practical for daily living.  But I also think you are correct in the first part of that sentence where you said people would continue to place value on gold because of the historical precedent.  It's an infallible characteristic of modern human behavior.  If something is rare and a person believes that it will be prized by other humans, then they will also ascribe value to it.   Diamonds.  Works of art.  Pokemon cards.  Whatever.  Gold has a special place in human culture, but it's value as a currency lies in it's very fixed supply.  Easy to divide into smaller pieces and re-combine into larger pieces.  Can be stamped into coins with denominations and national symbols.  So many attributes that give it a "leg-up" over other materials.  Can you eat it?  No.  Can you trade it for food?  Depends on how much extra food is laying around and available for sale.  If food becomes incredibly scarce then its price, denominated in gold, will go up - so gold would loose value in relation to food.  Gold's value is not constant in relation to the goods you purchase with it.  However, you cannot easily degrade it's value by creating a whole lot more of it and increasing the money supply.  This results in an incredibly efficient and accurate pricing mechanism in the market.  Is it efficient to carry around?  Not really.  Does it result in the market finding the best equilibrium for all asset prices in aggregate?  Absolutely.  So economic decision making is super precise - means less waste - means faster accumulation of wealth by a society - means rising standard of living for everyone.   That's what you give up when you abandon gold.  You doom your self to an ever-lasting cycle of credit booms and busts built upon a background of continually degrading standards of living for average people.

2 hours ago, ruraljuror said:

I may even be less outraged by the seizure/reimbursement of gold

I honestly can't tell after all of that:  Are you are aren't you outraged by FDR's executive order to confiscate private gold holdings (in some form)?  Me?  I am outraged because I think it was wrong.

2 hours ago, ruraljuror said:

BUT, what I do mean to say is that no metal (or any other material that occupies physical space for that matter) is going to be the best possible primary medium in which value can be stored. Being limited by physical space necessarily excludes gold from this distinction in my opinion.

Now *this* is a substantial opinion!  I would like to know why you hold that belief.  What is it about a store of wealth occupying a defined physical space on earth that means it cannot be the primary medium of wealth storage for people?  This is the first time I have heard this answer.  Up to you if you want to expand upon it, but if you do, I am all ears to hear more about this.

2 hours ago, ruraljuror said:

I described my understanding about why 1933 was the year we effectively ditched the gold standard above - the dramatic change in monetary policy was a response to the Depression, not some byproduct of rapid modernization.

Agreed.  The US government chose to abandon the gold standard rather than default on its debts during the depression.  A prime example of the "too big to fail" phenomenon.  Does that make it right?  I say "no".

2 hours ago, ruraljuror said:

I would say that the money supply is less arbitrary than the supply of gold in the sense that the supply is controlled by the federal reserve.

Fascinating.  And I deduce from your argument that you you think the "arbitrary" supply of gold is somehow a negative aspect of this currency?  Because the quantity of available material is defined by the laws of physics rather than a board of governors?

2 hours ago, ruraljuror said:

I believe the thought was that forcing people to exchange their gold for US dollars and pulling gold out of circulation (since it wasn't circulating anyway) would eliminate the hoarding issue and it would enable the government to print more dollars and put them into circulation - which is exactly what the government then did through public works projects, which had the added benefits of giving people jobs, hope, and purpose which were in even shorter supply at the time than gold was.  I would also assume that the government getting its hands on most of the gold in the US would have had the effect of strengthening confidence in the dollar and US banks, in part by removing the competition - for better and for worse. But to me, none of that qualifies as 'crazy' economic policy enacted by a 'rogue president.' 

First of all, there was no hoarding issue.  Are people "hoarding money" in banks today.  Are people "hoarding stocks" in their 401K.  Are people "hoarding real-estate".  What is hoarding anyway?  To me it's just a buzzword that people use when they are unhappy with the amount of money that people are saving.  There were plenty of bank notes in circulation in 1933 to handle all the cash needs of the public for their daily commerce.  Gold reserves determine how many bank notes a bank can issue, so gold in the vaults means bank notes on the streets.

The Fed was caught in a credit bubble because they ran up some crazy debt beyond their gold balance during WW1 and even during peacetime during the 1920's.   A credit default was looming on the horizon and the Fed wanted the freedom to print an unlimited supply of currency without causing people to abandon the federal reserve note.  That's why they had to take gold from the populace, because they knew if they tried to print their way out of the looming default, the american public with savings in the bank would say "no way, you're not getting my money by inflating away its value" and they would switch to gold and silver to preserve their wealth.  That was contrary to the desires of the Fed, because the Fed needed to raid that store of wealth in everyone's savings account to cover the unsustainable debt load.  That's why the exchange rate between Federal Reserve Notes to Gold was raised from $20 to $35 in short order after the confiscation operation was complete.

2 hours ago, ruraljuror said:

I will also repeat here that I am no expert on the gold standard, wealth storage media, or monetary policy - so everything I'm saying here could be dead wrong and it wouldn't surprise me in the slightest. 

I'n not an expert either, but I would be extremely surprised if everything I am saying here is dead wrong.  In fact, I *know* I'm right because history has already shown all of the negative consequences of the US government's actions.

 

3 hours ago, ruraljuror said:

And if you don't mind me asking a couple questions in return, what's your goal here? Just an airing of grievances? Do you want to revive the gold standard? Do you want to recruit more goldbugs to inflate the value? I'm participating in this discussion because I find it to be a somewhat interesting philosophical topic of debate, but it seems like this issue is really personal to you. Am I wrong about that, and if not, what's the story?

I just like to hear what regular people think about issues.  I mean, I would be just as passionate about any of the other injustices committed by the US government, or any world government for that matter.  I'm a social justice warrior, man.  Bringing up grievances of oppressed peoples around the world and seeing who steps up to defend the bad guys.   I could just as well be arguing about the situation in Nagorno-karabakh or the plight of the Uighurs in XinJiang.  Executive order 6201 just happens to be a particularly concise issue to discuss, and it makes the US look like a basket-case, so it's fun to hear people try to defend the governments reaction.

[Nashvillain]

^As a self-proclaimed SJW, it's interesting that the first injustice you took up for debate was an incident in which well-off people were the "victims" of government oppression and yet were still fairly compensated for the value of their property. 

 

[Armacing]

30 minutes ago, Nashvillain said:

^As a self-proclaimed SJW, it's interesting that the first injustice you took up for debate was an incident in which well-off people were the "victims" of government oppression and yet were still fairly compensated for the value of their property. 

 

First of all, they were not fairly compensated.  Paper is not the same as gold.  They should have at least been given a quantity of silver equal in value to their gold.  Let's flip the script.  If paper is the same as gold, then why did the Fed reserve need to swap it for gold?  Heck, if paper is *better* than gold, then the Fed already had the better form of money - - why not leave those primitive cavemen alone and let them bang their noisy pieces of yellow metal together like a bunch of degenerate savages?  Why sully the good name of "Federal Reserve Bank" by touching the filthy metal of those backwards hoarders?

Second of all, a true SJW rages against oppression of all peoples, regardless of class, creed, or race.

[ruraljuror]

8 hours ago, Armacing said:

Your quote's in bold again

Precisely, the degree of intrusion is of no concern to me.  If someone takes half of your land or half of your gold, does that make them right? 

You keep leaving out the part that people were paid for the gold that was confiscated. I understand you believe that the exchange wasn't of equivalent value, but that doesn't negate that the exchange occurred. I agree that it would be an outrage if the government just took half of everyone's gold and provided nothing in return, but that's obviously not what happened. Arguing against straw men doesn't make your case stronger, and in fact it often reveals a sign of weakness in the argument.   

You have a very relativistic attitude towards tyranny.  Apparently there are not bright red lines for you morally, just a lot of gray areas that you are ready to go along with if the outcome is good for you.  Oops, sorry, doing that thing again where I ascribe opinions to you.  

I'm not sure how questioning my morality is supposed to help your case either, but it does indicate to me that you're upset and may be having a hard time detaching your emotions from this issue, which tends to cloud judgment in my experience. If you're willing to share, I'm curious when and how you first become aware of and/or passionate about this issue.

But to your point, I've seen you write in previous posts that you think taxes are thievery, right? And you also believe/recognize that taxes are ultimately enforced by violence? Do you pay taxes? Assuming your answer is 'yes,' aren't you then complicit in a tyrannical system that is essentially mugging your fellow citizens? Seems like a lot of gray area there to me. 

Seriously, if you disagree with me characterizing your opinions in a negative way using hyperbole or fanciful (though logically sound) analogies, why not refute them?  Let's be precise:  You are OK with a little government intrusion in the form of confiscating hard assets from the public, right?  Just state that plainly and own it.  Why beat around the bush?  Why not proudly declare "I believe that private property is subject to confiscation by the government based on presidential decree"?  Why is that so hard to say, rather than spending so many paragraphs exploring the myriad nuances of your mildly held belief on the subject?

Again, nothing was confiscated without reimbursement. I'm beginning to think there may be an underlying reason (subconscious or otherwise) that you consistently misstate what happened by ignoring the reimbursement part of the equation.

But again to your point, there's unfortunately more gray area in a discussion about government asset confiscation (with or without reimbursement) than would be convenient to your argument, so I understand why you're dismissive of the nuance and would like to paint the issue in black and white terms. That said, I'll do the best I can to spell out a few examples of when I'm ok with the government confiscating hard assets from the public and when I'm not:

I'm a huge opponent of civil asset forfeiture from people accused of crimes, but I've got no problem with civil asset forfeiture for those who are adjudicated to be guilty in cases where those assets represent ill-gotten gains.

Then there's good old eminent domain as we've discussed which I hate the idea of, but (in part because of reimbursement) I consider it to be a just and sometimes necessary function of government. A truly tyrannical government would just take the land it wanted/needed with no reimbursement to the previous owner and there would be no means for the previous owner to petition courts for any redress. The reimbursement and the opportunity for legal redress are what make eminent domain acceptable in my opinion. 

How about if my hypothetical grandfather the archaeologist found some Egyptian artifacts during a dig in Cairo back in the 1930's and he brought those artifacts home. Am I okay with the US government confiscating them in order to give them to some Egyptian national museum? Yep, that seems ok to me. Twist - what if my grandfather had bought those artifacts legally in an auction after some other archeologist dug them up and brought them to the US? I'm still ok with confiscation, though a little reimbursement from the Egyptian government would be nice if that's not too much to ask, you know? 

And finally, in terms of the government seizing contraband (which is probably the closest analogy to the gold seizure/reimbursement in dispute) I'm generally ok with it. For things that have been made newly illegal to possess (like gold coins/certificates in 1933) I think the reimbursement is what keeps things on the up-and-up and outside any reasonable claims of tyranny. I would feel the same way if the government banned assault rifles or a certain type of armor piercing ammunition tomorrow - if people want to turn them in and receive fair market value (ignoring second amendment issues) then I'm totally cool with that confiscation, and if the contraband isn't turned over after a certain grace period then I see no reason not to prosecute those abstainers for possession of illegal goods. Along those same lines, for assets that have been outlawed for a longer period of time -  like automatic weapons, bricks of cocaine, Cuban cigars, enriched uranium, etc. - I have no problem with the government confiscating those assets and providing no reimbursement whatsoever. No tyranny here as far as I'm concerned, and if later we as a society decide that we want to re-legalize any of this contraband and/or pay back losses to the confiscatees, then we're in luck because there's a political process in place to redress those very issues. 

I hope those examples shed some light on the issue generally without beating around the bush too much on my part, but if you have any other specific asset seizure scenarios that you'd like me to opine on, I'd be happy to.

But that's the thing.  It wasn't for the best.  You may find comfort in the belief that the *experts* decided what was best for you and you can live life without ever having to worry about the mean old gold hoarders or the arbitrary quantity of gold on planet earth.  You can even go ahead and enjoy a carefree existence because you are (hopefully) comfortably wealthy and your income always grows fast enough to keep up with inflation so that your standard of living never suffers.  My whole point here is a great evil was done by the government that day, and I also endeavored to help you break free from the lifetime of indoctrination you have been subjected to that made you think "it's probably for the best".  I've been through this argument 100 times with 100 people and heard the very responses you're giving me 100 times and they are all the same.  Nobody ever wants to have their world view shattered, and I get that.  So I don't expect you to be suddenly energized with the rage of a thousands angry squirrels and charge the steps of congress while chanting "Audit The Fed!".  I'm simply exposing you to the counter-argument to the official story the federal government and popular media give everyone on a daily basis.  Their message is "Nothing to see here, move along". 

There are parts of this paragraph that read like a patronizing manifesto. Putting *experts* in the equivalent of finger quotes and talking about how anyone with a different opinion from you is indoctrinated and isn't prepared for the world shattering truth doesn't sound all that different to me from some guy at a Trader Joe's calling everyone sheep for wearing masks and getting physical with a shelf-stocker who is politely trying to usher them to the door.

First, I'd like to point out that if you've had this conversation 100 times already, then I would think that you would have your argument pretty refined by now. Why don't you just cut to the chase and provide the best evidence and the best argument that you've got. Either it shatters my world and I join the ranks of the enlightened, or I remain an indoctrinated fool who just doesn't 'get it' -  why waste your time beyond that?

If you'll allow me to shed a little light on you in return, you can claim that leaving the gold standard 'wasn't for the best' but you don't actually know that, and apparently (more concerning) you don't know that you don't know that. Allow me to explain:

My claim that getting off the gold standard 'was for the best' is mostly based on how successful the dollar has been in becoming the reserve currency for the entire world, but I know that I could never actually prove that getting off the gold standard is what caused the dollar to thrive to such a degree - there are way too many moving parts to show a causal chain. That said, if the goal of ending the gold standard was to strengthen the US economy and the dollar, and the US economy and dollar then thrived relative to the rest of the world for the better part of the next century, then I'm inclined to think that ending the gold standard was a successful move. Still, I'll admit that all I've really got here is that A happened before B (and I don't believe that A was some great crime against the citizenry of this country), and B was good, therefore A was good. I'll admit that this is not a great argument on my part. 

That said, this 'not great' argument I'm presenting is heads and tales better than what you're relying on, because at least I have some historical outcomes by which to evaluate A (the ending of the gold standard). Of course it's not your fault that the US (along with every county on Earth) has given up the gold standard, but the simple fact is that you can't possibly know what would have happened had we not begun the process of abandoning it in 1933. Would the United States government still exist? Maybe - but you don't know. Would the US have been in a position to enter WWII if we hadn't abandoned the gold standard? Maybe - but you don't know. If we hadn't entered WWII or if our government had gone bankrupt or if the dollar had collapsed entirely in the 30s would democracy even exist? Maybe - but you don't know. Your only option is to imagine some hypothetical alternative history where the gold standard was kept in place, and that's a major disadvantage when trying to argue that the road not taken would have led somewhere better than where the road that was in fact taken. You can say "it wasn't for the best" til you're blue in the face, but it might be a better tactic to say 'I think that it wasn't for the best though it's obviously unknowable...but here's what has led me to that conclusion' - my version is certainly more precise for whatever it's worth to you, but that's just my two cents.

Agreed, those things would be more practical for daily living.  But I also think you are correct in the first part of that sentence where you said people would continue to place value on gold because of the historical precedent.  It's an infallible characteristic of modern human behavior.  If something is rare and a person believes that it will be prized by other humans, then they will also ascribe value to it.   Diamonds.  Works of art.  Pokemon cards.  Whatever.  Gold has a special place in human culture, but it's value as a currency lies in it's very fixed supply.  Easy to divide into smaller pieces and re-combine into larger pieces.  Can be stamped into coins with denominations and national symbols.  So many attributes that give it a "leg-up" over other materials.  Can you eat it?  No.  Can you trade it for food?  Depends on how much extra food is laying around and available for sale.  If food becomes incredibly scarce then its price, denominated in gold, will go up - so gold would loose value in relation to food.  Gold's value is not constant in relation to the goods you purchase with it.  However, you cannot easily degrade it's value by creating a whole lot more of it and increasing the money supply.  This results in an incredibly efficient and accurate pricing mechanism in the market.  Is it efficient to carry around?  Not really.  Does it result in the market finding the best equilibrium for all asset prices in aggregate?  Absolutely.  So economic decision making is super precise - means less waste - means faster accumulation of wealth by a society - means rising standard of living for everyone.   That's what you give up when you abandon gold.  You doom your self to an ever-lasting cycle of credit booms and busts built upon a background of continually degrading standards of living for average people.

These are all fair points and this is what I consider to be the strongest aspect of your position. If we were in a debate competition or something, I'd take issue with your certainty that valuing gold is an 'infallible human behavior' and I'm less confident in gold's immutable scarcity than you are (e.g. science and nature are both powerful forces and there's a non-zero chance that earth gets pelted by a golden meteorite field one day or that some scientist figures out how to slice a proton/electron off of elemental mercury) but your points here are all well taken.

I honestly can't tell after all of that:  Are you are aren't you outraged by FDR's executive order to confiscate private gold holdings (in some form)?  Me?  I am outraged because I think it was wrong.

Good catch - poor wording on my part. No, I'm not outraged by the executive order, the gold confiscation, the reimbursement, or what we were able to accomplish through the new monetary system that came to be in its place. As previously noted, the means by which the gold was confiscated is my biggest hang up with all of this, and that hang up does not rise to the level of outrage.

Now *this* is a substantial opinion!  I would like to know why you hold that belief.  What is it about a store of wealth occupying a defined physical space on earth that means it cannot be the primary medium of wealth storage for people?  This is the first time I have heard this answer.  Up to you if you want to expand upon it, but if you do, I am all ears to hear more about this.

Great, glad you liked this one! Just about anything that occupies physical space can be lost, stolen, destroyed, requires physical storage, and (probably most importantly) it can only exist in one place at one time. Further, in terms of gold specifically, it may be almost entirely chemically inert but it is not completely corrosion proof, so I believe some loss is expected over time (though I'll defer to your expertise -see how that works? - if I'm wrong about the corrosive loss).

I'll also note that data for example (whether digital, quantum, or whatever comes after quantum) may be susceptible to some of the same issues too, but the ceiling for technological improvements in data storage/security is infinitely higher than the our ability to protect and retain physical objects - pretty much no matter what we do, a stockpile of gold is always going to be vulnerable to a freak volcanic sinkhole and/or the gang from Ocean's 11. 

First of all, there was no hoarding issue.  Are people "hoarding money" in banks today. 

Woah, I just jolted to reality for a second there and realized that I may be talking to someone who doesn't understand how banks work.

See how that's not a very nice or productive way to communicate? 

But yeah, I know you're a smart guy and I'll give you the benefit of the doubt that you momentarily forgot banks loan out deposits to other banking customers, thus always keeping some portion of their deposits in circulation.

Are people "hoarding stocks" in their 401K.  

Companies regularly issue new stock when they want to raise more money and buy back stocks when they want to decrease the supply and raise the value of their shares. Sort of analogous to how the Fed operates, come to think of it.

Are people "hoarding real-estate". 

Arguably, yes. It's a fairly common complaint (discussed on this very board in fact) that people who own more than one home are driving up the prices of real estate across the board by hogging the supply. That's one of the reasons for all the AirBnB ire.

It's a philosophical argument as to whether there's any morality implications to owning multiple homes (I don't personally think it's morally wrong), but the economic impacts are pretty straightforward, and there's no doubt that being born later on the timeline is a disadvantage in terms of playing the real estate game when you're competing for a finite resource among a rapidly increasing global population.

What is hoarding anyway?  To me it's just a buzzword that people use when they are unhappy with the amount of money that people are saving.  

Hoarding is only a problem with finite resources, meaning you can't hoard dollars, which is one of the advantages of abandoning the gold standard.

But to understand the problem of hoarding, one need only imagine a world in which Pepsi and Coke have bought up all the private fresh water supplies in the world. We'd all be buying 16 oz. bottles for 150 dollars apiece and praying for rain. For a more practical example, think about how effectively OPEC can control the price of oil by how much they choose to pump out of the ground in a given month. Whether done by one group that controls a substantial proportion of a commodity necessary to biological/modern life, or many different individual actors that independently control a substantial proportion of that commodity who are all susceptible to the same external forces (like the gold hoarders of the Great Depression), the ability to affect the circulation or available supply of that commodity can have remarkable consequences on the price of that commodity to the point of near omnipotence. 

There were plenty of bank notes in circulation in 1933 to handle all the cash needs of the public for their daily commerce.  

One of the problems that FDR/America was facing was that we needed to boost the economy beyond just daily commerce, which I assume was already way down because they were in the middle of a depression. Daily commerce wasn't cutting it.

Gold reserves determine how many bank notes a bank can issue, so gold in the vaults means bank notes on the streets.

What you say here is true, but I think it would probably have been more accurate if you'd written 'the lack of gold in the vaults means the lack of bank notes on the streets.' Bank vaults weren't the only place people were keeping their gold. I also assume that the runs on the banks and the lack of confidence in the banking industry in general during that era led more than a few people to withdraw their deposits, but I'm totally open to being wrong if you want to do some research on this one. 

The Fed was caught in a credit bubble because they ran up some crazy debt beyond their gold balance during WW1 and even during peacetime during the 1920's.   A credit default was looming on the horizon and the Fed wanted the freedom to print an unlimited supply of currency without causing people to abandon the federal reserve note.  That's why they had to take gold from the populace, because they knew if they tried to print their way out of the looming default, the american public with savings in the bank would say "no way, you're not getting my money by inflating away its value" and they would switch to gold and silver to preserve their wealth. That was contrary to the desires of the Fed, because the Fed needed to raid that store of wealth in everyone's savings account to cover the unsustainable debt load.

Ok, and what do you think would have happened if the US defaulted on its debts at the time or if American citizens had abandoned the dollar? Do you imagine that the US would be in better shape today? Maybe. Do you imagine that it's possible that the US might be in worse shape and could conceivable not even exist? That would have to be a maybe too if you're being fair, right? This is the pickle I wrote about earlier in this post. It's one thing to be outraged at what you perceive as the tyrannical government overreach of the gold confiscation (which I disagree with, but I think it's at least a fair position to take), but it's a whole different thing to assume that not having taken those actions would have absolutely led to positive outcomes let alone even better outcomes. That's one area where I think your argument majorly falls short.

That's why the exchange rate between Federal Reserve Notes to Gold was raised from $20 to $35 in short order after the confiscation operation was complete.

Sure. Raising the exchange rate would have helped cover domestic debts (though probably not international ones, I suppose) but raising the exchange rate also happened to have the positive side effect of allowing the Fed to print more dollars that could then be put into circulation (70% more, in fact), which is exactly what the government then did.

Could the government have just raised the exchange rate without first having collected most of the country's gold supply - yeah, sure - but in that scenario the amount of gold that could have backed the issuance of new dollars would have been smaller because it would have been limited to the amount of gold that was deposited in banks, and there would have been no mechanism to ensure that most of those new dollars that actually made it into people's hands weren't just tucked under the mattress and kept out of circulation same as the stashed gold was. By first amassing the nation's gold supply, the government was able to guarantee that the vast majority of the new dollars created through increasing the exchange rate were put into circulation through jobs programs and public works projects, etc. (as mentioned in my last post), which had numerous benefits in addition to getting those new dollars circulating quickly. Not a bad plan as far as I'm concerned, and it seems to me like it worked pretty well.

I'm not an expert either, but I would be extremely surprised if everything I am saying here is dead wrong.  In fact, I *know* I'm right because history has already shown all of the negative consequences of the US government's actions.

Anything that can be known can be proven. Do you feel like you've successfully proven your case?  Or are me and the 100 other people with whom you've discussed this issue just too dense to understand it? I'll admit that the latter option at least is certainly possible.

But it's also possible that there may have been even worse consequences that history would have shown us if the US government hadn't taken those actions. Maybe we're living in the best of all possible worlds and maybe we're living in the worst of all possible worlds - we've got no other world by which to compare our world so how could we possibly know, right? But we can make internal comparisons within our world, and in that sense I think the US did pretty well economically through the remainder of the 20th century relative to most countries on Earth. If you're going to look at the negative consequences, you should probably take the positive consequences into account too.

I just like to hear what regular people think about issues.  I mean, I would be just as passionate about any of the other injustices committed by the US government, or any world government for that matter.  I'm a social justice warrior, man.  Bringing up grievances of oppressed peoples around the world and seeing who steps up to defend the bad guys.   I could just as well be arguing about the situation in Nagorno-karabakh or the plight of the Uighurs in XinJiang.  Executive order 6201 just happens to be a particularly concise issue to discuss, and it makes the US look like a basket-case, so it's fun to hear people try to defend the governments reaction.

In that case, I'm glad you're having fun and am happy to oblige!

Edited August 12, 2020 by ruraljuror

[Rockatansky]

21 hours ago, Armacing said:

Paper is not the same as gold. 

Paper and gold are exactly the same. Both are valued because we agree they have value. In fact you can argue that paper has more value because it has the power of the American economy (or European economy etc...) backing it up.

[Armacing]

Great responses in this last post, I think we're making progress!

18 hours ago, ruraljuror said:

You keep leaving out the part that people were paid for the gold that was confiscated. I understand you believe that the exchange wasn't of equivalent value, but that doesn't negate that the exchange occurred.

So if you're walking down the street and someone sees you have a fancy watch on, and they point a gun at you and say "I think that watch is worth $500, here's $500 cash, now give me that watch!",  would you characterize that as an "exchange"?  Because if we apply your logic to that hypothetical scenario, you are basically saying "Hey, stop complaining about the watch, they gave you cash value for it".

Do you realize the Fed set the cash exchange value below the true value of gold?  That's why they couldn't allow customers to exchange fed notes for gold any longer, because the value of gold had already surpassed their set $20 conversion rate.  But even if the victims were fairly compensated monetarily, it's still not an arms-length exchange because coercion was involved.

18 hours ago, ruraljuror said:

...if the government just took half of everyone's gold and provided nothing in return, but that's obviously not what happened. Arguing against straw men doesn't make your case stronger, and in fact it often reveals a sign of weakness in the argument.   

My "half of your gold" comment was to refute the notion you introduced that there was a huge difference between taking everything over $100  in total and taking everything denominated over $100.  My analogy was intended to illustrate how your straw man about only taking gold denominated over $100 was of no consequence in a discussion about the inherent morality and legality (or lack thereof) of the government's confiscatory actions. 

And let me take this opportunity to say that you were wrong about that whole $100 denomination thing anyway - - did you read that wikipedia article?  People were only allowed to keep 5 ounces of gold in total, regardless of denomination on the coin or bar.

18 hours ago, ruraljuror said:

aren't you then complicit in a tyrannical system that is essentially mugging your fellow citizens

I would only be complicit if I voted in favor of it, which I don't.  And as you correctly noted, I take every opportunity to try to save my fellow citizens from that tyranny by arguing against it.  I may be compliant with the tyrannical system because I don't want to suffer the punishments they dole out to the non-compliant, but I don't agree with it.  You do agree with it - so you are complicit, hence why we are having this discussion.

18 hours ago, ruraljuror said:

and getting physical with a shelf-stocker who is politely trying to usher them to the door.

But that's the difference between us:  I'm arguing against unprovoked violence and you are arguing in favor of it.  It would be more accurate to describe me as some tie-dye shirt wearing hippy standing at the street corner yelling "Make love not war, man!  The military industrial complex has you all brianwashed into believing in boogeymen".  And you are the guy speeding by in your Lincoln Continental, muttering under your breath "That deluded slacker doesn't know how serious the situation is... he's living in a dream world."

 

18 hours ago, ruraljuror said:

First, I'd like to point out that if you've had this conversation 100 times already, then I would think that you would have your argument pretty refined by now. Why don't you just cut to the chase and provide the best evidence and the best argument that you've got. Either it shatters my world and I join the ranks of the enlightened, or I remain an indoctrinated fool who just doesn't 'get it' -  why waste your time beyond that?

Every discussion has its unique features - you have to lead someone to the door of enlightenment, but they have to step through it voluntarily.

18 hours ago, ruraljuror said:

My claim that getting off the gold standard 'was for the best' is mostly based on how successful the dollar has been in becoming the reserve currency for the entire world, but I know that I could never actually prove that getting off the gold standard is what caused the dollar to thrive to such a degree - there are way too many moving parts to show a causal chain. That said, if the goal of ending the gold standard was to strengthen the US economy and the dollar, and the US economy and dollar then thrived relative to the rest of the world for the better part of the next century, then I'm inclined to think that ending the gold standard was a successful move. Still, I'll admit that all I've really got here is that A happened before B (and I don't believe that A was some great crime against the citizenry of this country), and B was good, therefore A was good. I'll admit that this is not a great argument on my part. 

I think your logic would be sound if the US had left the gold standard and the rest of the world stayed on the gold standard.  If, in that environment, the US Dollar became the world reserve currency, then I would say that you are correct.  But as it happened, basically all major economies abandoned the gold standard at the same time  (or within a few decades of each other) because they all wanted to  manipulate the value of their currencies.  I think Charles De Gaulle actually played a major role in forcing the US off of the gold standard in 1971 when he tried to exchange Frances holdings of dollars for gold.  So the inter-connected nature of international fiances were part of the reason that FDR had to react to the Bank of England's maneuvers, and later on the French forced Nixon's hand.  Both presidents really had very little choice in the matter because they were merely reacting to the situation the Fed had created.

18 hours ago, ruraljuror said:

but the simple fact is that you can't possibly know what would have happened had we not begun the process of abandoning it in 1933.

I concede this point.  It's true I don't know exactly what would have happened, but I don't think that precludes me from arguing against it based on my moral, philosophical, and economics-related reasons.  Again, an analogy:  We could say we don't know if Stalin did the world a favor by murdering 20 million Russians (or subjects of the Soviet Union - not all were ethnically Russian) because one of those 20 million could have turned out to be some kind of nuke-launching lunatic that would have ended the world.  As it turns out, the USSR disintegrated peacefully and the threat of nuclear armageddon subsided (hopefully).  So using your logic, one could argue Stalin's murderous reign of terror "turned out OK in the end".  My response would be "I don't care how it turned out, the act itself was wrong on its own merits, regardless of your post-hoc appraisal of its effectiveness."  I know this is me responding to an analogy that I created, but just copy and paste that response underneath your sentence above.

18 hours ago, ruraljuror said:

And finally, in terms of the government seizing contraband (which is probably the closest analogy to the gold seizure/reimbursement in dispute) I'm generally ok with it. For things that have been made newly illegal to possess (like gold coins/certificates in 1933) I think the reimbursement is what keeps things on the up-and-up and outside any reasonable claims of tyranny.

Interesting thing about you characterizing the gold as contraband... if we think about bricks of cocaine taken from a drug lord or a sawed-off shotgun, the government doesn't typically keep and use those assets?  Do the DEA agents later sell or snort the coke?  Do the police end up using the sawed-off shotgun while chasing down some perps?  Yet in this scenario, the Fed kept and uses the asset to this very day.   It's less of a situation of "you can't have that asset because it is bad for society", it's more like "hey, you have a really good asset, give me that because I want to use it."  To me, I don't think it fits in the contraband category.

18 hours ago, ruraljuror said:

I'll also note that data for example (whether digital, quantum, or whatever comes after quantum) may be susceptible to some of the same issues too, but the ceiling for technological improvements in data storage/security is infinitely higher than the our ability to protect and retain physical objects - pretty much no matter what we do, a stockpile of gold is always going to be vulnerable to a freak volcanic sinkhole and/or the gang from Ocean's 11. 

I don't want to get to far down the path of discussing digital currencies, but I think they suffer from all the same risks you ascribe to gold.   Security is required to protect it, and natural disasters could befall it.  Even the political risks are the same:  Flash forward to the year 2200 when the US government outlaws Bitcoin and makes everyone exchange their Bitcoin for US dollars 2.0 at an exchange rate of 1 Bitcoin per 1 New Dollar.

18 hours ago, ruraljuror said:

Arguably, yes. It's a fairly common complaint (discussed on this very board in fact) that people who own more than one home are driving up the prices of real estate across the board by hogging the supply. That's one of the reasons for all the AirBnB ire.

Interesting - it seems you do indeed begrudge those who own more assets than they need to merely survive (strictly speaking).  As you describe your philosophy above, owning more houses besides the one you live in is a wrong against your fellow citizen because it raises their cost of buying a house.  And therefore, this potentially legitimizes confiscating (or limiting ownership) of what you would describe as "excess houses".  Now I really see where you are coming from on the Gold issue.  You really do believe that private property ownership is not unconditional, but rather subject to the needs of everyone else in society, collectively.  We could end the discussion right here if we wanted because you are basically saying "I think the gold confiscation was OK because Socialism".  That is a logical position to take on your part - if you chose to take it.  We should only continue to argue the issue if you think that FDR's executive order was consistent with the principles of capitalism and the classical-liberalism underpinnings of the constitution.

18 hours ago, ruraljuror said:

Hoarding is only a problem with finite resources, meaning you can't hoard dollars, which is one of the advantages of abandoning the gold standard.

Isn't that the same thing as saying "you can't save dollars"?  How are people supposed to store wealth in a way that it does not lose its value?

18 hours ago, ruraljuror said:

But to understand the problem of hoarding, one need only imagine a world in which Pepsi and Coke have bought up all the private fresh water supplies in the world.

If they bought the water, doesn't that mean that everyone else willingly sold it to them in exchange for something they valued more than water?  Nobody makes a trade for something of lesser value, do they?

If anyone had gold in the bank in 1933, or under their mattress, somebody else gave it to them voluntarily (excluding criminals) in exchange for some other asset that they valued more than gold.

18 hours ago, ruraljuror said:

Whether done by one group that controls a substantial proportion of a commodity necessary to biological/modern life, or many different individual actors that independently control a substantial proportion of that commodity who are all susceptible to the same external forces (like the gold hoarders of the Great Depression), the ability to affect the circulation or available supply of that commodity can have remarkable consequences on the price of that commodity to the point of near omnipotence. 

OK, yes, controlling a crucial asset does give power to the possessor.  So would you describe EO 6201 as the transfer of power form the American People to the US Government?  You have accurately noted the correlation between gold and control of the money supply - shouldn't you also acknowledge the movement of power from the people to the government?   Mustn't you also agree with my characterization of EO 6201 as a take-over of the entire economy by the government?  He who controls the money supply controls the economy - don't you agree?

18 hours ago, ruraljuror said:

Ok, and what do you think would have happened if the US defaulted on its debts at the time or if American citizens had abandoned the dollar? Do you imagine that the US would be in better shape today?

Hey, just because the Fed and the US government were so incompetent that they ran the entire economy into the ground and put themselves in default, does that mean that private citizens have to bail them out with their own gold?  I'll wager if the Fed/US gov had gone to those owning gold in 1919 and said "hey, we're thinking of joining this costly war in Europe, what do you think we should do?" those gold owners would have said "no, let's just sit this one out and see what happens".  Don't you believe in the concept of accountability?  The Fed was capable of creating a credit bubble, let them deal with the consequences and suffer the pains of the revolution when the US Public shows up on the steps of the New York Fed with pitchforks and buckets of hot tar, asking where their money went.

18 hours ago, ruraljuror said:

Do you imagine that the US would be in better shape today? Maybe. Do you imagine that it's possible that the US might be in worse shape and could conceivable not even exist? That would have to be a maybe too if you're being fair, right? 

Yes, absolutely possible.  But I say sticking to one's principles usually works out better in the end.  If FDR's choices were:  Steal the gold and preserve the regime, or don't steal the gold and witness a revolution, I say he should have let the revolution occur.  Live free or die, man.  It means we're choosing freedom even if it kills us.  How can someone claim to have principles if they abandon them at the first sign of trouble?

18 hours ago, ruraljuror said:

It's one thing to be outraged at what you perceive as the tyrannical government overreach of the gold confiscation (which I disagree with, but I think it's at least a fair position to take), but it's a whole different thing to assume that not having taken those actions would have absolutely led to positive outcomes let alone even better outcomes. That's one area where I think your argument majorly falls short.

Well, I don't think I ever claimed that I knew absolutely that it would have turned out better.  I said that I could see the negative side effects of what they did, namely the business cycle and inflation and declining standards of living.  There's no guarantee the American Public would have been smart enough to stick with the whole "Life, Liberty, and the pursuit of Happiness" philosophy when the going gets rough.  Desperate people do desperate things, obviously.  But I tend to give people the benefit of the doubt and I imagine they would have learned from the Fed's default and implemented safeguards to prevent banks from creating credit bubbles.

18 hours ago, ruraljuror said:

Not a bad plan as far as I'm concerned, and it seems to me like it worked pretty well.

Sure, for a bunch of incompetent bankers and politicians who created a crisis, they managed to steal their way out of the situation fairly well.  By their own standards, it was a blinding success, insomuch as the word "success" can be applied to a situation where you extricate yourself from a trap that you created.

18 hours ago, ruraljuror said:

Do you feel like you've successfully proven your case?  

It's a work in progress...

18 hours ago, ruraljuror said:

But it's also possible that there may have been even worse consequences that history would have shown us if the US government hadn't taken those actions. Maybe we're living in the best of all possible worlds and maybe we're living in the worst of all possible worlds - we've got no other world by which to compare our world so how could we possibly know, right? But we can make internal comparisons within our world, and in that sense I think the US did pretty well economically through the remainder of the 20th century relative to most countries on Earth. If you're going to look at the negative consequences, you should probably take the positive consequences into account too.

All countries essentially did the same thing, so I would say we don't have a control group to reference... the US succeeded where others fails due to reasons besides the gold standard.  But you do bring up an interesting point about how I should look at the positive consequences too.  I'm just thinking... should I give into temptation and compromise my principled stand against oppression and tyranny in exchange for prosperity and stability?  Um, no, I'm going to stick with the position that I don't care what the outcome was, taking peoples' property is wrong.

18 hours ago, ruraljuror said:

In that case, I'm glad you're having fun and am happy to oblige!

I hope it's at least a little fun for you as well.  

Edited August 12, 2020 by Armacing

[Armacing]

2 hours ago, Rockatansky said:

Paper and gold are exactly the same. Both are valued because we agree they have value. In fact you can argue that paper has more value because it has the power of the American economy (or European economy etc...) backing it up.

Cool, does that mean I don't have to worry about inflation any more?

[Nashvillain]

4 hours ago, Armacing said:

Cool, does that mean I don't have to worry about inflation any more?

Yeah, just buy gold. Never been a better time

[samsonh]

On 8/12/2020 at 5:07 PM, Armacing said:

Cool, does that mean I don't have to worry about inflation any more?

Markets certainly don’t think so. You should make a killing capitalizing on this I’m sure, taking the other side.

[ruraljuror]

On 8/12/2020 at 4:30 PM, Armacing said:

Your words in bold

Great responses in this last post, I think we're making progress!

First, sorry for the slow response on my part this go round. I do occasionally have to work, etc. -  although these debates are certainly preferable to at least a few of the other ways I am required to spend my time.

And thanks for the kind words about my last response post. I would say the same thing about your response here: it's the best of your response posts yet in my opinion, and I appreciated the tone check for the most part, so thanks again!

That said, I'm less optimistic than you are that any progress has been made. It seems to me more likely that we are better defining the impasses we're facing, but I guess that's sort of progress in a sense so I'll trudge on...

 

So if you're walking down the street and someone sees you have a fancy watch on, and they point a gun at you and say "I think that watch is worth $500, here's $500 cash, now give me that watch!",  would you characterize that as an "exchange"?  Because if we apply your logic to that hypothetical scenario, you are basically saying "Hey, stop complaining about the watch, they gave you cash value for it".

I don't think that comparing the government to a mugger is an analogy that can be reasonably applied to this situation, and I'm not sure how we're going to find much common ground when we're starting so far apart philosophically.

More concretely, I think it should be clear that you missed the mark with this mugger analogy because you've had to describe a scenario that is objectively absurd - one where the mugger is in fact purchasing the victim's watch at gunpoint and setting the price too low to boot. When your analogy requires that you twist a given scenario until it's entirely unrecognizable in real-world terms (i.e. muggers compensating their victims mid-crime), that is a red flag that you're probably using an inapplicable analogy.

Further, think about what happens if we apply your analogy to other governmental actions. In that light, just about anything that the government does would be outrageous if it were an act committed by your caricature of a criminal. Imagine a mugger telling you at gunpoint that you have to bring your car to a complete stop whenever you see this particular red octagon on the side of the road or else you owe him $65 dollars. Maybe the mugger says that you better not allow even one more person in this auditorium or he's going to shut down the whole concert and ruin it for everyone - no refunds. Perhaps a mugger tells you that you have to pay him 10% to 40% of your income every year (depending on how much you make) or he's going to lock you in a small room for 20 hours a day and feed you bad cafeteria food.

I could go on, but I think that should suffice to make it clear that this analogy isn't going to get you (or us) very far. In fact, by raising this analogy in support of your argument, it seems to me that you ultimately end up highlighting how very different the gold exchange is from a mugging, making the analogy more supportive of my argument than yours as I understand it.

 

Do you realize the Fed set the cash exchange value below the true value of gold?  That's why they couldn't allow customers to exchange fed notes for gold any longer, because the value of gold had already surpassed their set $20 conversion rate.  But even if the victims were fairly compensated monetarily, it's still not an arms-length exchange because coercion was involved.

Yes, I recognize that the Fed set the cash value below the market value of gold and that those forfeiting the gold had no direct say in the matter. Once again, I think your treatment of government as analogous to an individual actor is what's throwing off your analysis. This is not a coercive negotiation with a slippery pawn shop broker who can smell how badly you need the cash. On the contrary, the government doesn't need to coerce you to get what it wants - the government makes the rules and we make the government, that's the deal - and equating the government to a business or a person is never going to lead to rationally sound conclusions. 

From the perspective of a governmental institution instead of an individual bad actor, setting the price of gold below market value is no different from building in a flat tax that applies to the front end of the exchange transaction, which I think the government is certainly within its right to do. Further, given that creditors could no longer demand repayment in gold, it's entirely possible that the executive order might've caused the price of gold in the local market to drop below the exchange rate set by government. With that possibility in mind, the $20 conversion rate might have effectively been a compromise between two potential market responses to the US decision to move away from the gold standard. In effect, the predetermined exchange rate would have served as insurance for the gold owners of the US whereby some of the upside they might have hoped for in the future sale/exchange of their gold would have been sacrificed to prevent the potential downsides that could have accompanied major market disruption imposed by the government. 

More importantly, I believe the government has the right to issue its own currency and to establish rules to ensure the supremacy of its own currency in transactions that take place within its borders. This is not a particularly outrageous notion in my opinion, but you clearly strongly disagree with that proposition - which is okay. Because of the way our government is organized, if you can convince enough people to agree with your philosophy, you could in fact actually make some political headway toward creating a government more like how you wish it would be.

That said, of course, this is all pretty much a moot point now because our government already rescinded the prohibition against maintaining holdings of gold bullion back in the 70's, which you're clearly aware of given your gold-buying promotion. Does that not satisfy your quarrel here, or do you think that some other kind of amends should be made? Are reparations in order? I could potentially get on board with that notion - although I think our government would probably first have to deal out some reparations for other transgressions in that case (to say the least).

 

My "half of your gold" comment was to refute the notion you introduced that there was a huge difference between taking everything over $100  in total and taking everything denominated over $100.  My analogy was intended to illustrate how your straw man about only taking gold denominated over $100 was of no consequence in a discussion about the inherent morality and legality (or lack thereof) of the government's confiscatory actions. 

You continue to rest your case on moral grounds, but I'm not sure that your argument has much moral grounding at all.

Would it have been immoral for George Washington to declare that all British Pounds must be exchanged for dollars in order to make sure that American currency was the dominant value storage medium within our new country's territory? That doesn't sound unreasonable to me. Does our government not have the right to set our monetary policy and to put a thumb on the scale in favor of our own currency? I have no problem with that on a philosophical level, and I don't think that FDR's executive order was philosophically any different or worse.

That said, as I have repeatedly noted throughout our discussion, I would have preferred that our government had used other means to pull the gold out of the market (e.g. incentives or taxation), but the means by which the gold was exchanged hardly rises to the level of moral outrage for me, and your efforts to paint the 'inherent morality' of the situation in black and white terms is itself inherently flawed.

For example, one could fairly say that it's inherently immoral to cut off another person's leg, and that would be generally true. But what if it's an amputation performed by a doctor to prevent an infection from spreading and killing the patient? That would be an exception to the general rule that it's immoral to cut off another person's leg. 

But what if the doctor misdiagnosed the infection and didn't actually need to cut off the patient's leg, but did anyway - is that an immoral act on the part of the doctor? No, it's still not immoral - because the doctor was an appropriate person to make that determination (even if mistaken), the doctor genuinely believed that the amputation was necessary to save the patient's life, and the doctor acted in accordance with those genuinely held beliefs.

What if the doctor properly diagnosed the infection and was aware that there was a less invasive type of medicinal treatment that could potentially help with the infection, but the doctor thought the infection had spread too far already, so they made the call to amputate immediately. Is that immoral? Well, still probably no - though it certainly seems like it would've been good to allow the patient to provide input on the decision themselves if they were conscious. As it happens in our real-world scenario, the patient was conscious and did sort of get to weigh in or their treatment of choice when they (s)elected FDR as their doctor - I mean president - instead of sticking with what the patient had deemed to be Hoover's medical malpractice.

At the risk of driving this morality point all the way through the dead horse, If FDR believed that moving away from the gold standard was necessary to save the life of the USA - even if he was wrong in his diagnosis or if there was another treatment that could have possibly worked - there would still be nothing inherently immoral about the decision he made. On the other hand, if FDR's true motive in moving away from the gold standard was to enrich his wealthy friends and bankers, for example, then of course it would have been an immoral action - but given that bankers and wealthy people were the ones most opposed to moving away from the gold standard, that doesn't seem likely, and I've yet to hear any other alternative immorally-rooted motives ascribed to FDR's decision making process, either.

 

And let me take this opportunity to say that you were wrong about that whole $100 denomination thing anyway - - did you read that wikipedia article?  People were only allowed to keep 5 ounces of gold in total, regardless of denomination on the coin or bar.

Thanks, I'll take your word for it -  I appreciate your doing the research.

 

I would only be complicit if I voted in favor of it, which I don't.  And as you correctly noted, I take every opportunity to try to save my fellow citizens from that tyranny by arguing against it.  I may be compliant with the tyrannical system because I don't want to suffer the punishments they dole out to the non-compliant, but I don't agree with it.  You do agree with it - so you are complicit, hence why we are having this discussion.

FirstI have a very hard time believing that you've exclusively voted for political candidates who wanted to eliminate taxes. Most libertarian candidates don't even go that far. Do you only vote for write-in candidates? Serious question.

 

I think your logic would be sound if the US had left the gold standard and the rest of the world stayed on the gold standard.  If, in that environment, the US Dollar became the world reserve currency, then I would say that you are correct.  But as it happened, basically all major economies abandoned the gold standard at the same time  (or within a few decades of each other) because they all wanted to  manipulate the value of their currencies.  I think Charles De Gaulle actually played a major role in forcing the US off of the gold standard in 1971 when he tried to exchange Frances holdings of dollars for gold.  So the inter-connected nature of international fiances were part of the reason that FDR had to react to the Bank of England's maneuvers, and later on the French forced Nixon's hand.  Both presidents really had very little choice in the matter because they were merely reacting to the situation the Fed had created.

You're right that there's no control in this experiment, but you're downplaying the fact that the US did in fact become the world reserve currency. That's essentially the best possible outcome - your currency either is the world's reserve currency or it isn't the world's reserve currency, and we know for a fact that abandoning the gold standard (right or wrong, smart or stupid, moral or immoral, legal or illegal) at the very least did not preempt the dollar from becoming the world's reserve currency. Staying on the gold standard could not have led to a better result on this point. The best that the staying-on-the-gold-standard scenario could hope for is a tie, and worse outcomes were certainly possible if not likely.

Further, if you acknowledge "Both presidents really had very little choice in the matter because they were merely reacting to the situation the Fed had created," then why do you demonize FDR for his executive order? There's a disconnect there.

 

I concede this point.  It's true I don't know exactly what would have happened, but I don't think that precludes me from arguing against it based on my moral, philosophical, and economics-related reasons.  Again, an analogy:  We could say we don't know if Stalin did the world a favor by murdering 20 million Russians (or subjects of the Soviet Union - not all were ethnically Russian) because one of those 20 million could have turned out to be some kind of nuke-launching lunatic that would have ended the world.  As it turns out, the USSR disintegrated peacefully and the threat of nuclear armageddon subsided (hopefully).  So using your logic, one could argue Stalin's murderous reign of terror "turned out OK in the end".  My response would be "I don't care how it turned out, the act itself was wrong on its own merits, regardless of your post-hoc appraisal of its effectiveness."  I know this is me responding to an analogy that I created, but just copy and paste that response underneath your sentence above.

I think you've brought up the murder of millions of people in about half of your response posts throughout this debate. I understand that you're just using extreme examples to make your point, and I understand what you're trying to highlight of course - bad things that lead to positive outcomes are still bad things - but I'm confident you can make that argument without invoking the death of millions of people. 

But to your point - causation issues aside for the moment - yes of course bad things that have positive outcomes are still bad things, this goes without saying. But not all bad things are equally objectionable. For example, lighting a cigarette in the middle of a movie theater is bad, but it's not as bad as yelling fire in a movie theater, which isn't as bad as lighting a fire in a movie theater, which isn't as bad as lighting a person on fire in a movie theater.  Maybe the second hand smoke from the movie cigarette gave future-Hitler a lung-scarring asthma attack that inhibited him from giving vibrant public speeches thereby preventing his rise to power, or maybe future-Hitler's grandfather is the man that gets lit on fire and becomes infertile prior to creating any progeny. The actions in these scenarios aren't equally 'bad' but they do both lead to the exact same positive result, because just about any scenario can be crafted to lead to a specific positive outcome given enough creativity and causal leaps.  And more, even if you're right to classify FDR's actions as bad (whereas I give the doctor the benefit of the doubt that his intentions were good in performing the leg amputation) I think you'd have to agree that his actions certainly are closer to the 'smoking in the movie theater' side of the gray scale than the 'lighting a person on fire in a movie theater' end of the spectrum. He's certainly a long way off from genocide.

 

Interesting thing about you characterizing the gold as contraband... if we think about bricks of cocaine taken from a drug lord or a sawed-off shotgun, the government doesn't typically keep and use those assets?  Do the DEA agents later sell or snort the coke?  Do the police end up using the sawed-off shotgun while chasing down some perps?  Yet in this scenario, the Fed kept and uses the asset to this very day.   It's less of a situation of "you can't have that asset because it is bad for society", it's more like "hey, you have a really good asset, give me that because I want to use it."  To me, I don't think it fits in the contraband category.

I think you make a good point here. Law enforcement will redeploy confiscated assets, and I think the government would maybe make good use out of any enriched uranium it happened to collect, but I think your point about distinguishing gold from traditional contraband is a solid argument.

 

I don't want to get to far down the path of discussing digital currencies, but I think they suffer from all the same risks you ascribe to gold.   Security is required to protect it, and natural disasters could befall it.  Even the political risks are the same:  Flash forward to the year 2200 when the US government outlaws Bitcoin and makes everyone exchange their Bitcoin for US dollars 2.0 at an exchange rate of 1 Bitcoin per 1 New Dollar.

I don't want to get too far down the path of discussing digital currencies either, and I don't actually disagree with anything you wrote here, but none of your response in this paragraph contradicts what I was saying.

Yes, security is required to protect both physical and digital assets, but the ceiling for technological improvements in data storage/security is infinitely higher than our ability to protect and retain physical objects. And yes, both digital and physical assets are vulnerable to natural disasters, but physical assets can be inherently more vulnerable because they can only be located in one physical location at any given time, thus more susceptible to a singular disaster event at that location. None of this is a major point in the debate of course, I'm just pointing out that the likelihood that gold will ever return to dominance as the primary means of value storage in a civilized world is pretty slim as I see it.

 

Interesting - it seems you do indeed begrudge those who own more assets than they need to merely survive (strictly speaking).  As you describe your philosophy above, owning more houses besides the one you live in is a wrong against your fellow citizen because it raises their cost of buying a house.  And therefore, this potentially legitimizes confiscating (or limiting ownership) of what you would describe as "excess houses".  Now I really see where you are coming from on the Gold issue.  You really do believe that private property ownership is not unconditional, but rather subject to the needs of everyone else in society, collectively.  We could end the discussion right here if we wanted because you are basically saying "I think the gold confiscation was OK because Socialism".  That is a logical position to take on your part - if you chose to take it.  We should only continue to argue the issue if you think that FDR's executive order was consistent with the principles of capitalism and the classical-liberalism underpinnings of the constitution.

My argument has nothing to do with socialism or capitalism - it's about circulation - so I'm not sure where that's coming from.  My whole point was to illustrate the negative effects of hoarding a limited resource, which apparently was a concept with which you weren't too familiar prior to this discussion.

You also omitted the part of my last post where I specifically said that I don't think it's immoral to own more than one home, so I'm not sure why you're ascribing that philosophy to me. Again, just trying to explain hoarding.

 

Isn't that the same thing as saying "you can't save dollars"?  How are people supposed to store wealth in a way that it does not lose its value?

Of course you can save dollars, but you can't hoard dollars because the supply isn't finite (see my last post). The more I'm reading here, the more I believe that some more information about deflation could be really helpful in informing this discussion. The concept of hoarding finite resources and deflation are inextricably linked, so I think your misconception about hoarding may be the root cause of what I see as your over-concern about inflation vs. your under-concern about deflation.

And to answer your question, there is no way that I know of to store wealth that makes it immune to dilution in value. Inflation, with which you seem to be very familiar,  increases the currency supply thereby decreasing the value of each individual unit of currency relative to the entire supply, of course. But this process doesn't happen in a vacuum - it's related to the overall demand for currency, which is driven by the demand for goods and services in an economy. If the money supply increases by 3% in a given year, then the value of each dollar generally decreases relative to the whole supply accordingly - but that presumes that the economy (i.e. demand/production of good and services) is actually increasing by less than the rate of increase to the money supply. If the economy is growing at the exact 3% rate as the money supply, then there essentially is no inflation or decrease in the value of the currency, and if the economy is growing faster than the inflation rate, then currency can actually increase in value despite the increase in the money supply. To further flesh out this scenario, if the money supply is increased by 3% in a year but the economy grows by only 1%, then yes the value of each unit of currency will be lower (or less valuable) than it was the previous year because the money supply has grown faster than the demand for money. Alternatively, if the money supply grows by 3% in a given year, but the economy grows by 6%, then - despite the increase in the money supply - the value of each unit of currency has actually increased because the demand for currency is outpacing the growth of the money supply.

To bring these ideas back to gold specifically, gold too experiences some kind of 'inflation' because we dig up more of it out of the ground every year. According to the first search result that google just returned for me (so who knows if it's accurate), we add about 1% more gold to the gold supply on an annual basis. Does that then mean that the value of gold is diluted every year? Not necessarily. In fact, as noted above, if the economy is growing at a greater than 1% rate in a given year, then the value of gold is actually increasing. In that scenario, gold would be actually earning 'interest' just by sitting in a box in the closet or underneath the bed. 

This gets us back to the concept of hoarding. Currently, the primary ways that currency can increase in value is through circulation - as an interest rate on a bank account so the bank can loan out its customers' idle money to other customers who want to take out loans (for which the owners of the idle currency receive a small percentage of the earnings), or as a coupon payment on a bond so the bond issuer can put idle money to use in the short-term before returning it to the bond holder in the long-term, or as capital gains that come from the investment of idle money so that a company can try and hopefully succeed in netting a positive return for the investor. By incentivizing the circulation of capital, additional value can be created from existing value, and the economy grows faster, which in turn increases the value of each unit of currency even beyond the value of the earned interest/coupon/ROI.

When currency is a relatively finite resource like gold, however, that currency value can grow while remaining idle. In fact, with gold as the primary currency, gold owners would be incentivized to keep their gold out of circulation (i.e. hoarding it) for this very reason. As a result, however, there can be a shortage of currency available to keep up with all the demand for goods and services in an economy, which not only increases the price of gold (further incentivizing hoarding) but also slows down the economic output of goods and services as the economy moves toward equilibrium with the gold supply that supports those economic transactions. Put another way, if gold owners are being increasingly incentivized to keep their gold supply out of circulation (because the less gold in circulation means the faster their non-circulated gold is increasing in value in a macro sense) then even if the actual gold supply is growing by 1% a year, the supply that is available for transactions could be shrinking into negative growth rate territory in any given year, further incentivizing hoarding and further slowing economic output, which results in a vicious cycle. This is what happens with deflation, and we had to deal with it in this country on more than a few occasions before we started moving away from the gold standard.

 

OK, yes, controlling a crucial asset does give power to the possessor.  So would you describe EO 6201 as the transfer of power form the American People to the US Government?  You have accurately noted the correlation between gold and control of the money supply - shouldn't you also acknowledge the movement of power from the people to the government?   Mustn't you also agree with my characterization of EO 6201 as a take-over of the entire economy by the government?  He who controls the money supply controls the economy - don't you agree?

Hoarding finite resources isn't just about power or control as you imply in your paragraph here - it's about supply and demand as noted above.

That said, I suppose there's a good argument to be made that we'd all be in better shape if there wasn't such a robust credit market (excessive debt), or if healthy GDP growth was a steady 1% a year instead of fluctuating more, or if investment wasn't incentivized - (all attributes of a deflating currency)- but in all of our all back-and-forth on this topic I don't remember you addressing those issues in depth if at all, though correct me if I'm wrong of course.

And while I think your point that control of the money supply equals control of the economy is somewhat of an overstatement, I do agree it's true that controlling the money supply can have significant influence over economic activity. For a practical example, what do you think would have happened over the last few months if we hadn't printed a bunch of money to boost the markets and send unemployment checks to the 50 million people who have been out of work over the course of the pandemic? Do you think our economy would be in better or worse shape than it is? If your answer is that the economy would probably be in worse shape, then that's a pretty timely example of one benefit of not being tied to the gold standard right there. Based on what you've written throughout this discussion, I assume that you agree that the current economy is likely better off (at least in the short term) as a result of those cash injections, but that you still would disagree with that action as a matter of principle - in which case I think that's a fair argument for the most part, but I'll and I'll the 'principle' aspect shortly, which is where that argument ultimately falls short in my opinion.

 

Hey, just because the Fed and the US government were so incompetent that they ran the entire economy into the ground and put themselves in default, does that mean that private citizens have to bail them out with their own gold?  I'll wager if the Fed/US gov had gone to those owning gold in 1919 and said "hey, we're thinking of joining this costly war in Europe, what do you think we should do?" those gold owners would have said "no, let's just sit this one out and see what happens".  Don't you believe in the concept of accountability?  The Fed was capable of creating a credit bubble, let them deal with the consequences and suffer the pains of the revolution when the US Public shows up on the steps of the New York Fed with pitchforks and buckets of hot tar, asking where their money went.

Yes, private citizens do have to bail out the federal government - because that government is us and without it there is no United States and there is no dollar. 

And yes, I do believe in the concept of accountability, and I believe that the citizens of the US were accountable for their decision to elect a congress and a president in Woodrow Wilson who felt that entering the Great War was necessary to secure long-term American interests. Whether or not you or I agree or disagree with that decision is pretty irrelevant because that's what the duly elected officials at the time chose to do. For what it's worth, I think you're right that the gold holders would probably have rather kept their gold than had the US enter that war if that was the stark choice they were presented with. I bet more than a few of the non-gold holding servicemen who had to fight in the war would have supported that choice, as well. In fact, Wilson's party was kept out of the presidency for the next 12 years, perhaps because of the very accountability that you reference, at which point the voters again put their abilities to hold politicians to account into practice and elected FDR to help turn around the Great Depression. I see accountability in all of these decisions.

And regarding the pitchforks, I think it's worth point out that after having signed the executive order you find to be problematic, FDR went on to win reelection with over 60% of the vote on his way to winning a record-setting 4 presidential elections...and then we elected one of his vice presidents twice. Perhaps you can write this off as tyranny of the masses, but FDR prevented the very pitchfork scenario that you're describing, and because you believe your relatively narrow, self-composed definition of what is and what is not rightly within the scope of government authority somehow trumps FDR's, that enables you to view the pitchfork scenario as preferable to the thriving economy and strong dollar that became our history instead. I'm all for living your principles and very much respect that approach to life, but those principles must be constantly reaffirmed and reevaluated, especially when it's likely that following a principle in a given instance would lead to more suffering and/or a worse outcome. 

 

Yes, absolutely possible.  But I say sticking to one's principles usually works out better in the end.  If FDR's choices were:  Steal the gold and preserve the regime, or don't steal the gold and witness a revolution, I say he should have let the revolution occur.  Live free or die, man.  It means we're choosing freedom even if it kills us.  How can someone claim to have principles if they abandon them at the first sign of trouble?

I'm not sure where to begin with this one.

First, I have no idea why you think that a revolution against the US government would have led to a scenario where you would enjoy even more freedoms than you currently do given that political revolutions of the era were trending in the exact opposite direction (See Germany c. 1933).

Second, I'm not sure whose principles you're referring to here other than your own when you say 'sticking to one's principles' - although I think this is probably another example of the logical flaws that can result from characterizing the government as though it were an individual person.  That said, based on FDR's electoral success noted above, the majority of the American people's principles at the time were in line with his decisions generally, so I don't think the principles you're advocating were actually the views of the 'country' so to speak.

But what interests me most about your last paragraph is your inclusion of the 'Live Free or Die' mantra. 

First, I think it's pretty grandiose to bring up the mantra of 'Live Free or Die' in the context of currency exchange given the oh-so-many grievances one might rightly have against their government. As one example, since 1973 there have been 167 death row inmates that have been exonerated and released, for one example. That's more than 3 and a half people every year, and that number doesn't include the people who were actually innocent but were executed anyway. Just think what you could accomplish in terms of combatting egregious government overreach if you'd harnessed half of the energy you've exerted arguing about the gold standard 100s of times, and instead redirected that outrage into volunteering with the Innocence Project. Think of the moral high ground you could claim then and how thoroughly you could back it up, which I assume must have some appeal to you based on your framing of this debate.

Even more importantly, however, I have to ask: is Live Free or Die really a mantra that you do actually live by? It seems to me that you have allowed yourself to be subjected to jaywalking laws that restrict your freedom to cross the street wherever you please, yet that limitation on your freedom doesn't appear to have been worth dying for in your estimation. You probably put on your seat belt when you're driving most of the time, right? I surmise braving the tyranny of that regulation wasn't too much to bear. I'm sure that there are countless other freedom-inhibiting laws that you choke down on a regular basis, and yet you seem fixated on this one legal action that didn't even apply in your lifetime unless you're pushing 50+ years old - which I assume is a good 15 to 25 years longer than you've been roaming this planet. Why is the gold standard worth dying for but your freedom to cross the street as you please or drive the car without any safety device is not? And if the only answer that you have to fall back on is that you "may be compliant with the tyrannical system because [you] don't want to suffer the punishments they dole out to the non-compliant, but [you] don't agree with it"  - I hope you can at least recognize that's how pretty much everyone feels about government actions that we don't agree with, so you're not exactly taking a particularly unique or brave stance here - certainly not one that merits the invocation of Live Free or Die, which are powerful words precisely because the were uttered with sincerity and not taken in vain .

 

Sure, for a bunch of incompetent bankers and politicians who created a crisis, they managed to steal their way out of the situation fairly well.  By their own standards, it was a blinding success, insomuch as the word "success" can be applied to a situation where you extricate yourself from a trap that you created.

I think we've got something mixed up here - as I understand it, bankers and rich people were the ones who suffered most from leaving the gold standard. In fact it was bankers and rich people who attempted to overthrow FDR specifically because of his stance on the gold standard (see The Business Plot of 1933 if you're unfamiliar).

 

I hope it's at least a little fun for you as well.  

I do enjoy this discussion, but I feel like we're both saying a lot of the same things over and over again in a way that's counterproductive to a fruitful debate. I also fear that much of the possibility for any kind of progress or agreement gets lost in the back and forth, piecemeal nature of our responses, so let me try to summarize where we are as I understand it for the sake of minimizing mission creep.

I think that you have made 3 good points through our discussion so far:

1. Gold has a lot of attributes that make it a good medium for wealth storage beyond the demand it inspires in the luxury goods market. Your points about its distinct color, relative scarcity, malleability, and inert nature were all spot on. You are correct that there are good, logical reasons why gold was the dominant medium for value storage through much of modern human history. That said, I still maintain that the physical limitations of gold will prevent it from ever again becoming the dominant value storage medium, barring near total civilizational collapse/reboot.

2. In the event of a civilizational collapse/reboot, I think you're right that gold may retain more usage and popularity as a value storage medium than I had previously given credit. You made an excellent point about the degree to which people are creatures of habit and experience, and for those reasons alone it's very possible that gold will again become the dominant value storage medium on earth. That said, in the event of civilizational collapse, I still maintain that I would prefer a bag of seeds, a goat, some chickens, and/or strong hand tools over a briefcase of gold if I had my choice on what to be bartering with.

3. I think you made a good argument about how gold is different from other forms of contraband, and simply making gold illegal to possess in certain quantities doesn't change that dynamic. That said, I would argue that the ways in which gold can be illegal and yet still different from other forms of contraband, further illustrates that government restrictions on competing currencies is a unique area of law that isn't easily compared to other areas of law. 

So those are the points where I think you've made your strongest arguments, but there are more than a few areas where I just don't see how we're going to move beyond the impasses that are between us:

In sum, you think that the government mandating citizens exchange gold for dollars at a below-market rate set by the government is both immoral and tyrannical, whereas I see it (in its most favorable light) as an effective monetary policy decision that enabled our country and the dollar to flourish, and at worst I see a doctor making the tough call to amputate a leg in order to save the patient.

1. I'd agree with you that an executive order wasn't the ideal mechanism to start moving away from the gold standard, which is a fair complaint. Congressional action would've been a much better route from a procedural standpoint, though not necessarily from a practical standpoint, of course.

2. I'd agree with you that the means by which the gold was confiscated under threat of jail wasn't the ideal method. As I've noted, I'd have much preferred the government to use taxes and incentives in order to pull the bulk of the American gold supply out of circulation. That said, I think my preferences here are coming from the privileged position of not currently suffering from the ills of the Great Depression and from the advantageous position of hindsight, so I'm willing to defer to the urgency of the moment as experienced by FDR at the time.

3. I'd agree with you in principle that transactions are inherently unjust if one party is both mandating that a transaction takes place and that same party is responsible for setting the price/rate of the transaction. That said, I believe that government is an exception to this principle because effective/meaningful government can not exist without mandating taxes and setting the rates, enacting laws and determining the appropriate range of punishment when those laws aren't abided, and administering regulations with consequences both civil and criminal for compliance failures - which are all necessary functions of government in violation of the aforementioned principle. Further, we still retain the power to elect our government and write or rewrite the rules about how that government is allowed to operate, so we the people are de facto on both sides of the very transactions we're discussing. Without these abilities, government essentially ceases to exist, but tyranny and power imbalances can/do still thrive - only without the accountability, but that's just my two cents.

4. I'd also agree with you that it's certainly possible that the US and/or the world might be a better place if we'd never moved away from the gold standard. Maybe we would have bounced out of the Depression in '34 for reasons unknown, with a country and economy no worse for the wear. Or maybe there would have been a second American Revolution from which an even more perfect union was established. It's certainly possible. I'll also concede that if the credit system had failed and the dollar zeroed out, it's conceivable that we could somehow be better off as a result and living in a more preferable (and certainly drastically different country/world) today.  But I would argue that it's much more likely that the collapse of the dollar and/or a second American Revolution in 1933 would have led to fewer freedoms and could potentially have been the beginning of the end of democracy on a global scale. Neither of us can know the outcome of your hypothetical scenario of course, and I respect the good-intentions that I believe underlie your preference to "let the revolution occur....even if it kills us," but I can't help but view that as the cavalier perspective of a Monday morning quarterback with no real skin in the game. I expect that when you are actually in a position to influence the lives and deaths of other people with your decisions that you're far more willing to weigh the costs of sticking with your principles vs. the benefits of reevaluating and maybe even redefining those principles in light of real-world consequences. Principles are nothing more than rules by which we choose to live our lives, and like all rules, there are not only exceptions to the rule, but there are in fact situations in which following the rule would be immoral whereas abandoning or redefining the principle would be far more morally sound an in line with the spirit of the principle if not the black letter face value of the principle.

So that's my best effort to summarize the debate as I understand it and to (as best as I can) fairly describe what I see as the impasses we're unlikely to get past here. I'm happy to leave it at that - unless you see another potential avenue for progress and or consensus that I could very well be missing, in which case feel free to raise the relevant issues in your response.

Should you want to continue, however, I would make the following requests for the sake of not rehashing too much of the same stylistic ground, so we can be more focused on the substantive ground. If you're up for it, I would very much appreciate that you craft a reply:

1. Without referring to the "taking" or "stealing" (or any other thievery synonym) of gold without also referencing that the government did in fact exchange that gold for currency. And if you again feel the need to point out that the government set the exchange rate, that's fine (although undisputed).

2. Without using an analogy that equates moving away from the gold standard with mass murder committed by a government. The Nazis throwing bricks through the windows of Jewish-owned property was bad, but it's not as bad as sending Jewish people to death camps - i.e. even among totalitarian actions however you may define them, there are differences in degree that should be readily acknowledged in a fair assessment of those actions.

3. Without using an analogy that treats the government as though it were a person and not an institution over which the citizens of our country can exert meaningful power. 

4. Without referencing 'tyranny' or 'authoritarian' behavior on the part of the government - unless you first provide a list of some actions committed by our government that you think are actually more tyrannical/authoritarian than ending the gold standard. This one is just to make sure we're (if not on the same page) at least on the same planet in terms of the relativity of grievances against the government. 

I think these adjustments to debate tactics could really help maintain the focus on the substantive issues should you want to respond and continue. The choice is yours, of course, and thanks as always for the informed discussion regardless!

 

Edited August 26, 2020 by ruraljuror

[Tennessine]

....

 

I'm going to interrupt the big brain posts with an intermission

....

 

 

And now, back to your regularly scheduled programming.

 

 

 

[Armacing]

Hey, sorry for the delayed response... I didn't realize you were still in this discussion but I was pleasantly surprised to see that I was wrong!  Let's keep going with this...

On 8/25/2020 at 7:41 PM, ruraljuror said:

I could go on, but I think that should suffice to make it clear that this analogy isn't going to get you (or us) very far. In fact, by raising this analogy in support of your argument, it seems to me that you ultimately end up highlighting how very different the gold exchange is from a mugging, making the analogy more supportive of my argument than yours as I understand it.

That's the problem with your use of the word "exchange".... in the context of gold taken by force by the government, your use of the word "exchange" bestows an undeserved patina of reciprocity.  Your emphasis on the "compensation in cash" that was given is further intellectual dishonesty because you are attempting to gloss over or morally equivocate the essential nature of the crime that was committed.  This is not like other government services where taxes are collected within the context of providing public services that benefit the tax payer.  There is no way you can say that any good or service of equal value was given in "exchange" to those who had their gold taken.  That's the absurdity illustrated in the analogy - which is a reflection of your absurd characterization of this whole affair as an "exchange".

On 8/25/2020 at 7:41 PM, ruraljuror said:

the government makes the rules and we make the government, that's the deal - and equating the government to a business or a person is never going to lead to rationally sound conclusions. 

 Don't get confused here:  We're discussing what the government should or should not do.  *You* are the person who said the government should confiscate the gold, therefore you take on the mantle of "pro-government" advocate in this discussion.  As such, you are called to defend the government's actions as morally and socially just.  But saying "the government makes the rules" is not a suitable defense of the government's actions.  You actually have to say why those rules are just.... unless of course you are willing to admit the rules were unjust.  Then the discussion is over.

 

On 8/25/2020 at 7:41 PM, ruraljuror said:

Further, given that creditors could no longer demand repayment in gold, it's entirely possible that the executive order might've caused the price of gold in the local market to drop below the exchange rate set by government.

No, this is patently wrong and contrary to the laws of supply and demand.  If people are asking for gold and trying to get rid of dollars, and then the government further restricts the public's access to gold by no longer exchanging it, then the price of gold on the street will immediately sky-rocket because everyone will be scrambling to trade dollars for gold with their fellow citizens because they don't want to be the last one's holding worthless pager.  The very act of declaring it will not exchange gold for bill is an admission that it's bankrupt.  That does not create a scenario where the dollar can increase in value versus gold.  Please think that through.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Are reparations in order? I could potentially get on board with that notion - although I think our government would probably first have to deal out some reparations for other transgressions in that case (to say the least).

Yes, on this point is seems we agree almost completely.  Reparations to the descendants of those who had their gold taken.  Plus, all gold held by the US government distributed to the public.  And as compensation for the wrongs perpetrated against African Americans - they get a triple share of the excess gold.  And all National Park and National Forest and National Wildlife Refuge lands given back to the Native American tribes in the areas where they were located before being driven from their land.  And all other public lands like Bureau of Land Management land will be distributed evenly among the rest of the US population by random lottery, except that African Americans receive a triple share of the land distribution.  

Those actions would be a good start for divesting the US government of it's assets and returning economic control to the public.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Does our government not have the right to set our monetary policy and to put a thumb on the scale in favor of our own currency?

In short, the answer is "No".   The government should not create, endorse, or otherwise favor any currency over the other because doing so would represent undue influence in the economic affairs of Americans.  Not to mention the inevitable negative economic consequences that such interferences causes (business cycle, inflation, etc.) and the attendant human suffering those economic consequences  cause.

On 8/25/2020 at 7:41 PM, ruraljuror said:

At the risk of driving this morality point all the way through the dead horse, If FDR believed that moving away from the gold standard was necessary to save the life of the USA - even if he was wrong in his diagnosis or if there was another treatment that could have possibly worked - there would still be nothing inherently immoral about the decision he made. On the other hand, if FDR's true motive in moving away from the gold standard was to enrich his wealthy friends and bankers, for example, then of course it would have been an immoral action - but given that bankers and wealthy people were the ones most opposed to moving away from the gold standard, that doesn't seem likely, and I've yet to hear any other alternative immorally-rooted motives ascribed to FDR's decision making process, either.

This is a good, meaty, substantive comment to chew on right here.  See, I told you we were making progress!  

Here is the "alternative immorally-rooted motive" that you have been waiting for:  FDR was actually helping the bankers because the bankers convinced him the US would be economically ruined (and FDR would be politically ruined) unless FDR confiscated the public's gold and helped the bankers orchestrate a take-over of the entire money supply, and by extension, the entire economy.  There were power-hungry people in government who liked the idea of taking control of the economy.  There were political forces pulling on FDR to "do something" to make the public happy and "take control" of the situation.  But I actually ascribe intelligence to FDR.  In my opinion, he knew that letting the banks fail would not be the end of America.  But he also knew that letting the banks fail would be the end of the Democrats' political ascendancy because it would show they were no more competent in "managing" the economy than Hoover was.  And FDR also knew that the public was too stupid to understand the complex economic consequences of confiscating the gold and moving to a fiat currency.  I actually think FDR new what those consequences would be, and the public's stupidity was both a blessing and a curse in that it both prevented FDR from explaining why the gold should not be taken, and also provided cover for him when he was ultimately signed to order for the gold to be taken.  You see, taking the gold was not FDR's idea.  He was advised to do that by his surrounding circle of experts who said it was the only way out of the intractable situation.  But he always had the opportunity to say no, and disregard the warnings of his experts.  He could have taken a moral stand against taking the property of US citizens for the purpose of achieving political ends or baling out a failed industry (banking).  But he didn't... so I fault him for that.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Serious question.

In all seriousness, I vote across the political spectrum:  Libertarian, Democrat, Republican.  My vote is always calibrated to elect the candidate that I think will do the most to hasten the implosion of the US government and its finances.  Right now, I plan to vote for whoever is promising the most "free stuff".  It would be great if we could get the US national debt up to something like 500% or 1000% of GDP.  That might induce China to make moves needed to make the Yuan the world's preferred reserve currency and bring about the collapse in the dollar's value that is necessary for the public to give up on it and move back to gold.   Only then can a gold-standard libertarian utopia rise from the ashes of a defeated Keynesian system.  So you might say I'm playing the long game when it comes to voting.

On 8/25/2020 at 7:41 PM, ruraljuror said:

we know for a fact that abandoning the gold standard (right or wrong, smart or stupid, moral or immoral, legal or illegal) at the very least did not preempt the dollar from becoming the world's reserve currency. Staying on the gold standard could not have led to a better result on this point. The best that the staying-on-the-gold-standard scenario could hope for is a tie, and worse outcomes were certainly possible if not likely.

I'm not so sure.  Being the only currency backed by gold would be a major selling point in the contest to claim the title of "world's reserve currency".  You are correct that the US dollar was the only currency to attain the title of "world's reserve currency" in the post-gold fiat currency era.   And you are correct that moving to fiat currency did not stop the US from becoming the "world's reserve currency".  But the effects of WW1 on other major economies in Europe all but guaranteed the US would be in a position to become the dominant economy.  And the outcome of WW2 cemented that destiny in a very profound way.  So I would argue that some events in world history aside from monetary policy had a lot to do with the ultimate prestige of the US dollar.  And it may be that the US dollar ultimately loses it's position due to some events that are completely unrelated to monetary policy as well.  We'll just have to wait and see, or die while waiting.   My personal prediction:  Whichever country invents super-intelligent AI first will become the dominant power in this century.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Further, if you acknowledge "Both presidents really had very little choice in the matter because they were merely reacting to the situation the Fed had created," then why do you demonize FDR for his executive order? There's a disconnect there.

Not really.   I consider it to be a hallmark of a true leader if he/she makes a decision based on their own morality (especially to protect a persecuted minority) even though they know it will outrage the majority and result in scorn from their colleagues and peers.  Those presidents had very little choice, but they still had a choice.  We need more leaders who will take a moral stand against the majority in order to protect the freedoms and property of minority groups in this country.

On 8/25/2020 at 7:41 PM, ruraljuror said:

And more, even if you're right to classify FDR's actions as bad ...He's certainly a long way off from genocide.

Agreed, obviously.  I do tend to gravitate to the more hyperbolic analogies - a personality flaw perhaps?  But it sounds like we did come to an understanding that just because the economic affairs of the US ultimately turned out to be comparatively good (in relation to other countries), that outcome in-and-of-itself does not negate the inherent immorality of the gold confiscation.  It may make you (or the public at large) feel better about the confiscation, but it should not allow anyone to say with a clear conscious:  "Taking gold from private citizens is moral and just".

On 8/25/2020 at 7:41 PM, ruraljuror said:

None of this is a major point in the debate of course, I'm just pointing out that the likelihood that gold will ever return to dominance as the primary means of value storage in a civilized world is pretty slim as I see it.

I like your comments and you may be right about the slim chances of gold returning.  Maybe information will turn out to be the real currency in the future, and that information will turn out to be stored electronically.  I think gold is a good currency for humans, but humans may not be calling the shots economically.  An interesting subject for sure... worthy of its own thread.  But I'll leave it at that and return to the main issue.

On 8/25/2020 at 7:41 PM, ruraljuror said:

And to answer your question, there is no way that I know of to store wealth that makes it immune to dilution in value....According to the first search result that google just returned for me (so who knows if it's accurate), we add about 1% more gold to the gold supply on an annual basis. Does that then mean that the value of gold is diluted every year? Not necessarily. In fact, as noted above, if the economy is growing at a greater than 1% rate in a given year, then the value of gold is actually increasing. In that scenario, gold would be actually earning 'interest' just by sitting in a box in the closet or underneath the bed. 

A couple points about this:  Some of that 1% increase in the gold supply is consumed in manufacturing goods, so not all of it would be available to be held as pure metallic store of wealth.  But that's just a side point.  The main thing I want to comment on is your idea that the money supply needs to increase with the size of an economy.  This is completely wrong.  Indeed, the sum total of all transactions between individuals need not have any bearing whatsoever on the value of the currency being used.  Let's say a society is exchanging $1B worth of goods.  Does that mean we need $1B worth of gold coins?  No, because only a fraction of transactions are being made at any one time.  Most of that economic value is tied up in the goods themselves.  But for argument's sake, let's say that there is $1B worth of gold in circulation (there's your favorite word!) and suddenly a rich tycoon decides he hates the world and he will become a hermit and lock away $500M of gold in a vault.   So half the gold is out of circulation.  Setting aside the serious obstacles to achieving such a feat, let's say it could be done.  The result would be that the remaining gold in circulation would double in value (relative to the assets being purchased by the gold) and trade would continue unabated.  

You have to understand that the value of gold (and any currency) is the relative demand for that asset in comparison to all other assets demanded by society. 

But bringing us back on track here:  The superiority of gold over fiat currency is the difficulty in expanding the supply of gold.  That 1% addition you referenced is accomplished at great difficulty by companies who scour the globe an incur massive expense to mine the extreme reaches of the planet.  In contrast, a government could raise the money supply by any multiple in a fraction of a second by simple decree.  So the security of an individual's savings in a fiat environment is, I would argue, dramatically lower than in a gold-reserve environment.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Currently, the primary ways that currency can increase in value is through circulation - as an interest rate on a bank account so the bank can loan out its customers' idle money to other customers who want to take out loans.

Now there's your problem right there.  You can't describe money in an interest-bearing bank account as "idle money".   Don't you think that savers evaluate all of their investment opportunities before choosing to deploy their scarce resources in a savings account?  They could have bought bonds, or stocks, but instead they decided to keep some cash as a liquid asset and collect interest.  The cash in bank accounts is "active" in the economy.   But that does not mean it's going up in value by virtue of being active.  On the contrary, the savers are earning *more* money as a return on their investment.  So the balance in their account goes up not because each dollar becomes more valuable, but rather because of the income from the investment.

On 8/25/2020 at 7:41 PM, ruraljuror said:

By incentivizing the circulation of capital, additional value can be created from existing value, and the economy grows faster, which in turn increases the value of each unit of currency even beyond the value of the earned interest/coupon/ROI.

People don't need to be incentivized to invest.  They always seek a return on investment and they always attempt to deploy their scarce resources in the most profitable way for their own personal benefit.

And NO, the value of the currency does not increase beyond they value of the interest earned.  This is simply not true.

On 8/25/2020 at 7:41 PM, ruraljuror said:

When currency is a relatively finite resource like gold, however, that currency value can grow while remaining idle. In fact, with gold as the primary currency, gold owners would be incentivized to keep their gold out of circulation (i.e. hoarding it) for this very reason. As a result, however, there can be a shortage of currency available to keep up with all the demand for goods and services in an economy, which not only increases the price of gold (further incentivizing hoarding) but also slows down the economic output of goods and services as the economy moves toward equilibrium with the gold supply that supports those economic transactions.

No, as I discussed previously, and as you state right here, the value of the remaining gold in circulation will increase, therefore the monetary value of the metal being exchanged is always sufficient to facilitate the exchange of goods and services.  You defeat your own argument by acknowledging that the value of the gold not "hoarded" will increase.  If the value increases proportionally, then there is always enough monetary value available to facilitate trade in goods and services, therefore:  no slow-down in the economy.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Put another way, if gold owners are being increasingly incentivized to keep their gold supply out of circulation (because the less gold in circulation means the faster their non-circulated gold is increasing in value in a macro sense) then even if the actual gold supply is growing by 1% a year, the supply that is available for transactions could be shrinking into negative growth rate territory in any given year, further incentivizing hoarding and further slowing economic output, which results in a vicious cycle. This is what happens with deflation, and we had to deal with it in this country on more than a few occasions before we started moving away from the gold standard.

A decrease in real value can only be driven by demand or supply changes in the asset being purchased, not by the quantity of gold available.  Because, as I mentioned, the value of gold can flex up or down depending on the demand or supply of gold - but in such a scenario the buyer and seller are equally affected.  If I'm selling apples and I charge 1/4th ounce for a barrel of apples, but then the supply of gold is cut in half, then gold will double in value and I will sell apples at a price of 1/4th ounce for two barrels of apples?  Is that "deflation"?  Perhaps in a monetary sense the prices went "down", but in terms of economic activity there is no change because the 1/4th ounce coin I received is worth double what it was before, so I received the same amount of wealth.

A real economic contraction for me as an apple seller would be if the newspaper runs an article about the negative health effects of eating apple and everyone switches to oranges.  Then I might have to sell 4 barrels for 1/4th ounce of gold, which would be less value than before in an economic sense. 

Please don't confuse value with price - they are two totally different things.  The price of gold will achieve equilibrium with all other assets when people's demand for goods & services exactly offsets their desire to save monetary assets (gold) for future investments.  This is a reflection of peoples attitudes about current consumption versus future consumption and various macro trends and current events can affect the public's opinion about when it is a good time to save an when it is a good time to spend.  You love fiat currencies because they give the government a way to *stop* people from saving during times of economic uncertainty.  I'm arguing that saving serves a vital function in a healthy economy and the public should have the ability to quickly take their assets out of circulation until such a time as they see fit to re-enter the market in search of goods and services.  This ensures there is ample capital available to be re-deployed in the most profitable way when the environment for spending & investing has improved.  

On 8/25/2020 at 7:41 PM, ruraljuror said:

For a practical example, what do you think would have happened over the last few months if we hadn't printed a bunch of money to boost the markets and send unemployment checks to the 50 million people who have been out of work over the course of the pandemic? Do you think our economy would be in better or worse shape than it is? If your answer is that the economy would probably be in worse shape, then that's a pretty timely example of one benefit of not being tied to the gold standard right there.

It depends on how you measure the economy.  If new market information becomes available to investors (e.g., coronavirus exists!) then investors will react to that new information in a way this best for them and preserves the most wealth.  Absent government intervention, I think the Stock market would have continued to fall and lost most of its value.   On the other hand, the stock market was only has high as it was because of government intervention to begin with, so if we take that away too, then the stock market would be  a minor consideration.  Absent massive stimulus checks being sent to people, consumer spending would have decreased.  We might have actually seen a decrease in the price of goods.  Absent near-zero interest rates we might have seen a decrease in the price of real-estate.  People who had savings before the virus would become comparatively richer in that scenario - which would be a good thing.   

I would say that not being tied to a gold standard was definitely a good thing for the political parties currently in charge.  As for whether it will be a good thing for America in the long run - we'll have to wait and see.

On 8/25/2020 at 7:41 PM, ruraljuror said:

I'm all for living your principles and very much respect that approach to life, but those principles must be constantly reaffirmed and reevaluated, especially when it's likely that following a principle in a given instance would lead to more suffering and/or a worse outcome. 

That's the thing about principles:  They are only principles when living by them *does* lead to more suffering.   If you are constantly "reevaluating" and "reaffirming" your principles in such a way as to minimize suffering, then you have no principles.   You accuse me of being over-dramatic sometimes, but you have to admit that you portray the scenario of an FDR who decides not to confiscate the gold as a dire situation.  America became an economic powerhouse before the Federal reserve bank even existed, and while gold was the main store of wealth.   And if the Fed had collapsed there would be a regime change and a great economic realignment, but not the end of America or total economic devastation.  There would have been a great reckoning on Wall Street - that much is certain.  But I argue it would have been for the better.  Instead of a concentration of wealth in those who benefited from the government bail-out, there would have been a great dispersal of economic power and wealth around the country.  Who knows - New York might not even be the largest city in America right now.

On 8/25/2020 at 7:41 PM, ruraljuror said:

First, I have no idea why you think that a revolution against the US government would have led to a scenario where you would enjoy even more freedoms than you currently do given that political revolutions of the era were trending in the exact opposite direction (See Germany c. 1933).

There would be no guarantees in such a revolution, except for a regime change.  Since the first event everyone would become aware of would be the bankruptcy of the federal reserve and the US government, I think it's a safe bet to assume people would be angry at the government for getting them (the public) into this situation.  As for what would happen after that - who knows.  Here's another mantra for you that I just made up:  Better to have a revolution and hope for freedom than prevent a revolution and guarantee you will never have freedom.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Second, I'm not sure whose principles you're referring to here other than your own when you say 'sticking to one's principles' - although I think this is probably another example of the logical flaws that can result from characterizing the government as though it were an individual person. 

American principles of freedom.  Why would someone become president and swear an oath to follow the constitution and defend American freedoms from all threats both foreign and domestic, and then turn right around and confiscate assets from one group of responsible Americans so they can be given to a group of irresponsible Americans to bail them out of a bad situation of their own creation?  It's contrary to the principles of freedom.

On 8/25/2020 at 7:41 PM, ruraljuror said:

Live Free or Die really a mantra that you do actually live by? It seems to me that you have allowed yourself to be subjected to jaywalking laws that restrict your freedom to cross the street wherever you please, yet that limitation on your freedom doesn't appear to have been worth dying for in your estimation. You probably put on your seat belt when you're driving most of the time, right? I surmise braving the tyranny of that regulation wasn't too much to bear.

Again, the question is not would I follow a law, it's do I support it or not.  The Live Free or Die mantra is for the country to follow when making important decisions about freedom, and for the individual to follow when voting on issues of freedom.  It does not justify breaking every law just because laws are inherently a limitation of freedom.

Now re-focusing on the issue at hand:  If you think the question of confiscating the gold was a life-or-death choice for America, then you might agree with my envocation of the "Live free or Die" mantra as applicable to that scenario.  If so, then let the record show you support FDR's choice of life over freedom.   You've already said a dozen times that the ends justify the means in this particular case.   Why not just own it and say that you believe in taking physical assets from a small minority of Americans if most of the public agrees with it and most people like the outcome?

On 8/25/2020 at 7:41 PM, ruraljuror said:

I think we've got something mixed up here - as I understand it, bankers and rich people were the ones who suffered most from leaving the gold standard. In fact it was bankers and rich people who attempted to overthrow FDR specifically because of his stance on the gold standard (see The Business Plot of 1933 if you're unfamiliar).

Yes, you have something mixed up here.  Rich people who had gold did not want to trade their gold for dollars.  But bankers did want the federal reserve to bail them out - so the two groups were opposed to each other.  Furthermore, to the extent that a collapsing Federal Reserve note would have imperiled the finances of banks, they (the bankers) were in favor of preventing the public from owning gold or withdrawing gold from the banks.  And to the extent that the Federal Reserve facilitated easy credit to the US government to finance deficit spending, the political regime in charge of the US government was against the public's ability to withdraw gold because it represented a check against their unrestrained ability to borrow from the Federal Reserve.  So you are only half right:  rich people suffered the most, but bankers are part of the team that benefited the most.

On 8/25/2020 at 7:41 PM, ruraljuror said:

4. Without referencing 'tyranny' or 'authoritarian' behavior on the part of the government - unless you first provide a list of some actions committed by our government that you think are actually more tyrannical/authoritarian than ending the gold standard. This one is just to make sure we're (if not on the same page) at least on the same planet in terms of the relativity of grievances against the government. 

Huzzah!  It seems I avoided using those two words by chance even before reading this last part.  But yeah, I could name a bunch of tyrannical actions by the US government ranging from dealings with Native Americans ,to the Civil War, to oppression of African Americans and other minorities, to the creation and perpetuation of monopolies , to innumerable foreign policies  that were either oppressive or in support of foreign oppressive regimes.  Not accepting the Jews of Europe en masse as refugees before the holocaust.  The Vietnam war and dropping agent orange on the fields.   CIA operations to foment revolutions and civil wars in countless countries.  The NSA and mass-surveillance uncovered by Snowden.  Etc., etc., etc.,   It would take quite a long time indeed to list all instances where the US government (and by extension, the US voting populace) did not adhere to the principles of life, liberty, an the pursuit of happiness.

Edited October 13, 2020 by Armacing
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