Lack of Gold Standard Hurts U.S. Economic Growth, Forbes Says
LAS VEGAS–The absence of a gold standard in the United States is hindering economic growth and leading to ill-fated monetary policies, former Republican presidential candidate Steve Forbes told more than 1,000 attendees during his keynote speech at the FreedomFest conference here.
Forbes confidently reinforced his past advocacy for a return to the gold standard to help stabilize the falling U.S. dollar, reassure foreign investors of the value of U.S. government bonds and spur federal spending discipline. He pointed blame directly at the U.S. government by telling attendees that such intervention is needed because “Big Brother” is “destroying the dollar.”
“The weaker the dollar, the bigger the government,” Forbes said. Since 1971 when the United States left the gold standard completely, the value of the dollar has gone down 80%, Forbes said. The U.S. government maintained a gold price of $35 per ounce until August 15, 1971, when President Richard Nixon announced that the United States would no longer convert dollars to gold at a fixed price.
That move followed a U.S. government retreat from the gold standard on June 5, 1933, when it ceased backing the value of the U.S. dollar with gold. Creditors previously could demand gold as payment starting in 1879 when the U.S. government first adopted the gold standard. The one exception occurred during World War I when the U.S. government imposed an embargo on gold exports.
Right now, the Federal Reserve Bank is one of the “least accountable” agencies in the world, Forbes said. The reality is that monetary policy “intimidates” people or just “bores” them,” he added.