by Ralph Benko
The only plank remaining under notable discussion from either national convention platform of 2012 is the GOP platform’s call for a national monetary commission. Although widely reported as a call for a new “Gold Commission”, the actual text calls for a “commission to investigate possible ways to set a fixed value for the dollar.”
While this plank was caricatured as a sop to the good Dr. Ron Paul, the evidence is persuasive that it was a substantive triumph by the Resolutions Committee editorial team and the co-chairs Rep. Marsha Blackburn and (rumored 2016 presidential aspirant) Virginia governor Bob McDonnell.
Reports about the call for such a commission continued (and continue) to resound around the world. Often commissions are a device for sidetracking — rather than taking on — a proposed reform. This is not necessarily their intention or effect. Some commentators have minimized the potential impact of a national monetary commission. These critics fail fully to appreciate how powerful such a commission can prove … if smartly structured as a neutral forum to tackle what may well be the most important macroeconomic variable required to restore economic growth and job creation: good money.
Clearly the prognostications of some of the smartest and most influential economists of both the right and left have been stymied by the Federal Reserve’s policy of monetary adventurism. The great Arthur Laffer sounded a klaxon of alarm in the Wall Street Journal about the explosion in the monetary base … and the high likelihood that the evil inflation djinn had been let out of the bottle … in his June 11, 2009 piece entitled Get Ready for Inflation and Higher Interest Rates The unprecedented expansion of the money supply could make the ’70s look benign: “as bad as the fiscal picture is, panic-driven monetary policies portend to have even more dire consequences. We can expect rapidly rising prices and much, much higher interest rates over the next four or five years, and a concomitant deleterious impact on output and employment not unlike the late 1970s.” …