Saying we have the highest debt level in history is a misleading statement when you fail to take into account the growth of national GDP.
But I can't quibble about there being too much debt. I agree that there is and that is why any surplus should go to paying it down, or as a compromise, 1/2 to debt paydown, 1/2 to tax cuts so that consumers have the choice, not the gov't.
And Jacksoninan economics were disastrously inflationary, with America defaulting on numerous loans extended by European banks (defaults under a gold standard?? Heaven forbid!!).
However, where cities like Chicago were literally non-existent in 1830, 30 years later the place was a bustling metropolis vastly worth more than those loans there were originally extended to build it. Jacksonians also built a number of infrastructure projects like canals and railroads so that goods could be readily transported to market.
The fruit of those investments were long-term, not short-term. Many projects defaulted and were acquired by other investors or the gov't itself.
It may have not been pretty, but it eased the life of the common man and led to even greater economic prosperity.
Brazil will likely default on its debt to the US and Europe sometime in the next 12-24 months. Will economic infrastructure and manufacturing gains that resulted from that expansion disappear as well? Clearly No.
Will some people lose money? Yes. And others wiped out.
But that has been the boom/bust cycle that has existed just as BLATANTLY under a gold standard as it has under Fiat.
And there is nothing that is solidly credible about gold if the popular perception of its value isn't realized.
Those who bought gold at $850/ounce were still buying at a fair value under your rules of the gold standard (dividing total total gold supplies into available money supply would have far exceeded a value of $1000/ounce, IMO). But those people have lost some $550/ounce in value since then. Some storehouse of value.
Had they sold and waited for weakness in the dollar to exhibit itself, they could buy gold back at a cheaper price and held more of it to boot.
Regards,
Ron |
