Top Pro & Con Arguments
Returning to a gold standard could harm national security by restricting the country’s ability to finance national defense.
A gold standard would prevent the sometimes necessary quick expansion of currency to finance war buildup. In order to help finance the Civil War, President Lincoln authorized the printing of $450 million in fiat currency known as “greenbacks.”
During World War I, the United States and many European countries stopped using a gold standard to finance war efforts by temporarily printing more moneyAs Kimberly Amadeo, MBA, President of World Money Watch, noted, “The Great War proved to be the first nail in the coffin for the international gold standard… [as it] was causing deflation and unemployment to run rampant.”
The United States financed its involvement in World War II in large part by having the Federal Reserve print money, selling war bonds, and running large deficits.Read More