And continues to be under-reported and under-appreciated, especially in media, academia, and Hollywood. On today’s date in 1971, President Richard Nixon ended the Bretton Woods Agreement, “temporarily” suspending the convertibility of the U.S. Dollar into gold. 49 years later, this “temporary” change is the furthest thing from it – after all, anything that lasts nearly 50 years really shouldn’t be considered temporary!
Since 1971, inflation has spiked, causing the affordability of consumer goods, such as housing and gasoline, to become less affordable. Contrary to popular belief, abandoning the gold standard has not improved the economy, benefited the poor, decreased income inequality, or expanded opportunities for civilization.
What it has done is give the very rich in the Federal Reserve and associated banking sector, mainly Wall Street a chance to go deeper into debt and engage in all sorts of speculative loans, such as in subprime mortgages that precipitated the 2007-2008 Great Recession. Despite the ability to increase the money supply, something claimed as absolutely indispensable by modern mainstream economists, a declining number of people are able to afford homes as well as other commodities, saving for retirement is harder, especially for the poor, and economic opportunities have shrunk considerably for the majority of people. Furthermore, government no longer has any restraints on its spending profligacy, as the greatest evidence comes in the form of consistently increasing gargantuan federal debt since 1971. Under a gold standard, government can’t go so deeply into debt, which keeps the national debt from reaching unsustainable levels like in today’s times.
These are the biggest reason why it is imperative for civilization to return to the gold standard. Doing so will enable greater prosperity for the broader public and will curtail the government’s ability to spend like crazy, and thereby abuse its power, and then force the hapless voters to pay for its recklessness.
I’ll now present the biggest reason why returning to the gold standard is most definitely the correct course of action. When Nixon ended the Bretton Woods Agreement, the U.S. Dollar could be redeemable for $35 per ounce of gold. So, let’s say your wage was $1.60 per hour back then, the minimum wage of 1971. That means you had to work nearly 22 hours to be able to buy an ounce of gold(excluding taxes, deductions and those sorts if variables). in 2020, nearly 50 years later, the price of gold is a little above $1,800 per ounce. With the federal minimum wage at $7.25 per hour, the poorest employees in our country have to work over 248 hours for that same ounce of gold, representing a decline in purchasing power by over 11-fold! How’s that for nearly 50 years of withdrawing from the crazy, arcane, obsolete gold standard?
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