Last updated on: 8/11/2020 | Author:

Pro & Con Quotes: Should the United States Return to a Gold Standard?

General Reference (not clearly pro or con)

Craig K. Elwell, Specialist in Macroeconomic Policy at the Congressional Research Service, stated the following in his June 23, 2011 article, “Brief History of the Gold in the United States,” available at

“The U.S. monetary system is based on paper money backed by the full faith and credit of the federal government [fiat money]. The currency is neither valued in, backed by, nor officially convertible into gold or silver…

A gold standard uses gold – directly or indirectly – as money. In a pure gold standard, gold itself is used in transactions, with all prices in essence expressed in terms of the amount of gold needed for purchase.

June 23, 2011 - Craig K. Elwell

PRO (yes)

Pro 1

John Tamny, Managing Editor of RealClearMarkets, Vice President at FreedomWorks, and a senior economic adviser to Toreador Research and Trading, in a Feb. 25, 2020 article, “A Few Questions for the Many Critics of the Gold Standard,” available at, stated:

“Why gold today? I’ll confidently speak for others who broadly share my opinions on money when I say that no serious gold-standard advocate is rigid in his or her need for a return to gold-defined money. Where we’re rigid is in our belief that money of ever-changing value deprives money to varying degrees of its singular purpose as a medium of exchange that enables individual specialization. I’ll add that floating money also slows progress that is always and everywhere a consequence of investment. Why put dollars to work if the value of dollar is wildly uncertain such that any returns could be eviscerated by money the value of which is changing all the time?

Stated simply, supporters of a gold standard, commodity standard, or currency stability more broadly seek just that given our view that it elevates money to its highest purpose as a facilitator of the exchange and investment that pushes people and physical resources to their highest use. There’s also a compassionate angle to this: Americans earn dollars, and a lack of currency stability has meant that Americans have suffered periodic devaluations that have amounted to a not-so-stealth shrinking of the value of their work. Translated, we work for dollars because dollars are exchangeable for goods and services. When the dollar is devalued, the fruits of our labor are logically shrunk.”

Feb. 25, 2020

Pro 2

Alasdair Macleod, Head of Research for GoldMoney, in a Feb. 20, 2020 article, “Will COVID-19 Lead to a Gold Standard?,” available at, stated:

“[T]he sooner we throw out fiat currencies, the sooner we can revert to sound money, which is gold… [G]iven the shutting down of China’s economy by the coronavirus. The yuan, surely, will be the first to suffer in the foreign exchanges, a process that appears to be starting. But this might galvanise the People’s Bank into positive action to stabilise the currency, which it can do by tying it to gold. In doing so, it would do humanity a favour by leading the way early towards a sound money solution to the unfolding financial and economic crisis, which with the coronavirus threatens to be potentially much worse than anything recorded in modern times…

To the extent the coronavirus has had a hand in the forthcoming destruction of fiat currencies and Keynesian mythology, we can take some comfort that it will have brought forward the eventual reintroduction of gold and gold standards. The path is not straightforward. There will be destruction of financial asset values and the economic consequences for ordinary people will be dire. We can expect widespread civil unrest and political instability.

Western governments and their advisers are not familiar with the arguments in favour of gold, having spent half a century dismissing it. This fact favours the new economies which have not discarded gold, which include Russia, China, and many other Asian nations. Some governments, such as India, might attempt to confiscate their citizens’ gold, but in general the collapse of western economic fallacies could lead to Asia’s economic superiority.

It will be a rough ride for the rest of us.”

Feb. 20, 2020

Pro 3

Judy Shelton, PhD, MBA, Trump Administration economic advisor and 2020 nominee to the Federal Reserve Board, in a Spring/Summer 2018 article, “The Case for a New International Monetary System,” available at, stated:

“As the gold standard was serially abandoned, international trade succumbed to the vicissitudes of unpredictable changes in exchange rates and retaliatory tariffs. Global depression had followed…

The United States is the world’s largest holder of official gold reserves. Comprising 8,311.5 tonnes or 261 million troy ounces, those reserves are carried at a book value of roughly $11 billion. Notably, the market value is significantly higher at $345 billion (based on the London Gold Fixing for September 30, 2016) as cited in the Treasury’s report filed June 30, 2017…

In proposing a new international monetary system linked in some way to gold, America has an opportunity to secure continued prominence in global monetary affairs while also promoting genuine free trade based on a solid monetary foundation. Gold has historically provided a common denominator for measuring value; widely accepted at all income levels of society, it is universally acknowledged as a monetary surrogate with intrinsic value.”

Spring/Summer 2018 - Judy Shelton, PhD

Pro 4

Alan Greenspan, PhD, former Chairman of the US Federal Reserve, in a Feb. 16, 2017 article, “Greenspan: The US Cannot Afford to Spend on Infrastructure Like It Wants because It’s Not on the Gold Standard” written by Akin Oyedele and available on, stated:

“I view gold as the primary global currency… Today, going back on to the gold standard would be perceived as an act of desperation. But if the gold standard were in place today we would not have reached the situation in which we now find ourselves. We cannot afford to spend on infrastructure in the way that we should. The US sorely needs it, and it would pay for itself eventually in the form of a better economic environment (infrastructure). But few of such benefits would be reflected in private cash flow to repay debt.

Much such infrastructure would have to be funded with government debt. We are already in danger of seeing the ratio of federal debt to GDP edging toward triple digits. We would never have reached this position of extreme indebtedness were we on the gold standard, because the gold standard is a way of ensuring that fiscal policy never gets out of line.”

Feb. 16, 2017 - Alan Greenspan, PhD

Pro 5

Donald J. Trump, 45th President of the United States, in an interview with GQ, a video of which is available on under the title “Donald Trump Weighs in on Marijuana, Hillary Clinton, and Man Buns,” (uploaded Nov. 23, 2015), stated:

“Bringing back the gold standard would be very hard to do, but boy would it be wonderful. We’d have a standard on which to base our money.”

Nov. 23, 2015 - Donald J. Trump

Pro 6

Ron Paul, MD, former US Representative (R-TX), stated the following in his Oct. 2, 2012 article, “Gold Is Good Money,” available on The Daily Bell website:

“Why is gold good money? Because it possesses all the monetary properties that the market demands: it is divisible, portable, recognizable and, most importantly, scarce – making it a stable store of value. It is all things the market needs good money to be and has been recognized as such throughout history. Gold rose to nearly $1800 an ounce after the Fed’s most recent round of quantitative easing because the people know that gold is money when fiat money fails…

Fiat money is not good money because it can be issued without limit and therefore cannot act as a stable store of value. A fiat monetary system gives complete discretion to those who run the printing press, allowing governments to spend money without having to suffer the political consequences of raising taxes. Fiat money benefits those who create it and receive it first, enriching government and its cronies. And the negative effects of fiat money are disguised so that people do not realize that money the Fed creates today is the reason for the busts, rising prices and unemployment, and diminished standard of living tomorrow…

As the fiat money pyramid crumbles, gold retains its luster. Rather than being the barbarous relic Keynesians have tried to lead us to believe it is, gold is, as the Bundesbank president put it, ‘a timeless classic.’ The defamation of gold wrought by central banks and governments is because gold exposes the devaluation of fiat currencies and the flawed policies of government.”

Oct. 2, 2012 - Ron Paul, MD

Pro 7

Lewis E. Lehrman, MA, Chairman of the Lehrman Institute, stated the following in his Oct. 2012 article “A Road To Prosperity,” available at

“Gold, a fundamental, metallic element of the earth’s constitution, exhibits unique properties that enabled it, during two millennia of market testing, to emerge as a universally accepted store of value and medium of exchange, not least because it could sustain purchasing power over the long run against a standard assortment of goods and services…

To choose or to reject the true gold standard is to decide between two fundamental options: on the one hand, a free, just, stable, and objective monetary order; and on the other, manipulated, inconvertible paper money, the fundamental cause of a casino culture of speculation and crony capitalism, and the incipient financial anarchy and inequality it engenders.

Restoration of a dollar convertible to gold would rebuild a necessary financial incentive for real, long-term, economic growth by encouraging saving, investment, entrepreneurial innovation, and capital allocation in productive facilities…

In a free market and its banking system, grounded by the rule of convertibility to gold, new money and credit may be prudently issued only against new production or additional supply for the market, thus maintaining equilibrium between total demand and total supply. Inflation is thereby ruled out.”

Oct. 2012 - Lewis E. Lehrman, MA

Pro 8

Steve Forbes, Chairman and Editor-in-Chief of Forbes Media, stated the following in his Oct. 22, 2012 article “Gold Can Save Us from Disaster,” available at

“A new gold standard is crucial. The disasters that the Federal Reserve and other central banks are inflicting on us with their funny-money policies are enormous and underappreciated. An unstable dollar is wreaking havoc on our capital markets, depriving us of money for productive enterprises and future enterprises while subsidizing government debt on a scale never before seen in U.S. history. The zero-interest-rate policy destroys capital by punishing savers and enabling the central bank to allocate where capital goes…

What the Fed is doing through its binge buying of bonds is enabling Washington to consume our national wealth. Instead of creating new wealth we are beginning to destroy that which exists. No wonder tens of millions of people feel – rightly – that their real incomes are declining and their financial situations are coming under more pressure. In real terms the stock market is lower today than it was in the late 1990s, and even in absolute terms it still isn’t where it was in 2007.

Can we move forward on a gold standard before a real catastrophe à la the 1930s results?…

Currently the federal government wages a virtual jihad against any attempt by individuals or companies to create gold-based monetary instruments for commercial transactions…

The combination of getting a serious debate on the gold standard going and sweeping away our legal tender laws barring competitive domestic currency would hasten the day that we’ll once again have a gold-based currency like that which did our country so much measurable good for 180 years.”

Oct. 22, 2012 - Steve Forbes

Pro 9

Ralph J. Benko, JD, Senior Economic Advisor at American Principles in Action and Editor and Advisor to the Lehrman Institute’s, stated the following in a Mar. 18, 2013 email to

“Monetary policy reform is a rapidly rising issue. ‘Good money’ is important for generating a climate of equitable prosperity. The empirical data show the classical gold standard to be the ‘gold standard’ of monetary policy. The Bank of England, in 2011, issued Financial Stability Paper No. 13. The Bank of England found that the fiduciary dollar standard badly underperforms in every major category, including economic growth, inflation, recessions, and banking crises.

Some still labor under the mistaken impression that the gold standard is a recipe for austerity and caused the Great Depression. This ignores the fact that there was no gold standard in 1929!

The classical gold standard was invented by two icons of science: Copernicus and Newton. Their work in astronomy and physics still stands the test of time. So does their monetary work. There is abundant evidence that attaining 4% growth, generating millions of new and better jobs as well as expanding the tax base and bringing in trillions of dollars of new revenue with which to balance the federal budget, can best, perhaps only, be achieved by adopting a 21st century gold standard.

Time for a fresh look at gold.”

Mar. 18, 2013 - Ralph J. Benko, JD

Pro 10

Herman Cain, MS, former Chairman of the Board of Directors of the Federal Reserve Bank of Kansas City, stated the following in his May 13, 2012 article, “We Need a Dollar as Good as Gold,” available at

“A dollar should be defined – as it was prior to 1971 under the postwar Bretton Woods system – as a fixed quantity of gold.

However imperfect a gold standard may be, it remains the best among all alternatives. The empirical data for both the classical gold standard, which I favor – and even the flawed ‘gold-exchange’ standard, as we had under the Bretton Woods system – are impressive. Economic growth was stronger, unemployment rates lower, the price level more stable, and recessions less frequent and less severe than under the present system.

I realize the Washington establishment goes ballistic at this suggestion. Gold is kryptonite to big-spending politicians. It is to the moochers and looters in government what sunlight and garlic are to vampires. The American people are another story. Nearly half (44%) support a return to a gold standard, according to an October 2011 Rasmussen Report. That support soars to 57% when respondents know it will ‘dramatically reduce the powers of bankers and the political class to steer the economy.’…

The political establishment will fight this idea viciously, because gold convertibility strips them of power and places the trump card over monetary policy with the people. If you thought the establishment attacked me over 9-9-9, wait until you see how they react to a classic gold standard. The vampires will be out in full force.

The debate over sound money has moved from whether we need it to how we get there. The pieces are moving in the right direction, and we have an opportunity to make the dollar once again as good as gold.”

May 13, 2012 - Herman Cain, MS

CON (no)

Con 1

Patrick Horan, MA, Program Manager for Monetary Policy at the Mercatus Center at George Mason University, in a July 20, 2020 article, “Is a Gold Standard Practical Today?,” available at, stated:

“As indicated by the historical record, a gold standard regime is not necessarily a bad idea. The classical gold standard performed comparatively well in its day. However, a gold standard regime is not necessarily a good idea for today because virtually every country now has a central bank, and central banks are major players in monetary policy and financial markets. Unless we abolish central banks (an unrealistic proposition), instituting some sort of gold standard–like system would require trusting central bankers to administer the system well.

Given the disastrous results of the interwar system as well as the end of the ill-fated postwar Bretton Woods System (which also proved difficult to implement as its fragile design prompted attacks from speculators seeking to game exchange rates they believed central banks could not credibly control), it seems unlikely that a current-day version of a gold standard would work well. Moreover, as the interwar experience shows, severe economic downturns brought on by poor monetary policy can lead to support for less market-oriented policies, as politicians blame the downturn on supposed inherent flaws of the market economy rather than on bad policy.”

July 20, 2020

Con 2

David Wilcox, PhD, Senior Fellow at the Peterson Institute for International Economics and Former Director of the Division of Research and Statistics at the Federal Reserve Board, in a July 15, 2020 article, “The Case against Judy Shelton for Federal Reserve Board,” available at, stated:

“The United States finally abandoned the gold standard in 1971, during Richard Nixon’s first term as president. With that, a disastrous experiment in monetary policymaking came to its demise. In the nearly 50 years since then, no country on earth has seen fit to use this outmoded approach to setting monetary conditions. During that period, central banks have learned how to control inflation with spectacular success, and become more focused on the importance of promoting full employment… [T]he very aspects that make the gold standard appealing to its advocates are what make it so appalling to mainstream experts. As a direct result of its simplicity, the gold standard disables two key shock absorbers that, in a normal economic system, help to stabilize economies in the face of unexpected turbulence.

First, the fact that exchange rates are fixed under a gold standard means that there is no latitude for a country to “put itself on sale” if it hits a rough patch. In a normal economic system, if the workforce is not fully employed, the local currency tends to depreciate. Locally produced goods and services instantly become cheaper to foreign buyers, helping to put the country back on the road to full employment.

Second, the fact that short-term interest rates serve only to stabilize gold reserves means that they cannot be used to promote full employment and low, stable inflation. In a normal economic system, if domestic demand is too weak, the central bank cuts its interest rate to make borrowing cheaper, providing additional support for getting the country back on the road to full employment.”

July 15, 2020

Con 3

Jerome Powell, JD, Federal Reserve Chairman, as quoted in a July 10, 2019 article written by Thomas Franck, “Fed’s Powell Explains Why a Return to the Gold Standard Would Be So Damaging to the Economy,” available at, stated:

“You’ve assigned us the job of two direct, real economy objectives: maximum employment, stable prices. If you assigned us [to] stabilize the dollar price of gold, monetary policy could do that, but the other things would fluctuate, and we wouldn’t care. We wouldn’t care if unemployment went up or down. That wouldn’t be our job anymore… There have been plenty of times in fairly recent history where the price of gold has sent a signal that would be quite negative for either of those goals. No other country uses it.”

July 10, 2019

Con 4

Barry Eichengreen, PHD, Professor of Economics at the University of California, Berkeley and Former Senior Policy Adviser at the International Monetary Fund, in an Aug. 15, 2019 article, “A Return to the Gold Standard Will Not Win Trump’s Trade War,” available at, stated:

“[G]old is no longer a stable anchor. The dollar price of gold has fluctuated from $900 in 2009 to $1,900 in 2011 and back to $1,500 today. Having the Fed peg the price of gold in dollars would do nothing to peg its relative price – that is, the price of gold relative to the prices of other goods and services. For the relative price of gold to double, as it did between 2009 and 2011, consumer prices would have to fall by half, in a catastrophic deflation.

The price of gold relative to CPI inflation was less volatile in the 19th century but this reflected the importance of gold mining. When the price of gold rose relative to the prices of other commodities, more resources were allocated to mining. Additional gold was extracted as a result, causing its relative price to fall. More precisely, other prices rose, as that additional gold backed an inflationary increase in money supplies.

Today, after a century-long increase in the production of other goods and services, gold mining accounts for a much smaller share of global GDP. The stabilising capacity of the mining industry is weaker, rendering the price of gold more volatile.

It might be argued that the volatility of the gold price reflects financial instability, which induces investors to rush into gold as a safe haven, and that the gold standard will produce a more stable financial environment. But there is no historical basis for this notion. Financial crises were a recurrent phenomenon under the gold standard. That is no mystery: having to stabilise the price of gold severely limited the ability of central banks to act as lenders of last resort to distressed financial systems. Instability frequently followed.’

Aug. 15, 2019 - Barry Eichengreen, PhD

Con 5

Russell A. Green, PhD, Will Clayton Fellow in International Economics at Rice University’s James A. Baker III Institute for Public Policy, in a Feb. 23, 2016 briefing for the James A. Baker III Institute for Public Policy titled “Gold Standard or Fool’s Gold? Should the U.S. Consider Returning to the Gold Standard?,” wrote:

“Whether based on theoretical or historical comparisons, the gold standard appears less likely to deliver superior price stability than the current system. Rather, money supply would be determined by the vagaries of the global gold market, which would only coincide with domestic economic needs by chance. Even if gold markets were perfectly stable, the gold standard would likely induce a damaging level of deflation.

It was precisely the unwillingness of the U.S. to undertake such a destructive monetary policy that lead to the 1971 collapse of the ‘gold exchange standard’ operated under Bretton Woods. Instead, the money supply continued to grow to support moderate inflation, which undermined the tie to gold.”

Feb. 23, 2016 - Russell A. Green, PhD

Con 6

Ben Walsh, Business Reporter at the Huffington Post, in a June 19, 2016 article for the Huffington Post titled “Donald Trump Would Wreck the U.S. Economy,” wrote:

“The gold standard might sound good – who, especially Donald Trump, doesn’t love gold and standards? – but it’s one of the worst economic ideas ever. This is a harebrained policy that no other country uses and not a single surveyed economist thinks is a good idea…

Under the gold standard, a dollar is worth a certain amount of gold. And since gold is a commodity whose price swings wildly, a central bank like the Federal Reserve would have to raise and cut interest rates based not on how well the economy is doing, but on what’s going on in the gold market.

It’s a good way to run a modern economy into the ground.”

June 19, 2016 - Ben Walsh

Con 7

Paul Krugman, PhD, Professor of Economics and International Affairs at Princeton University, stated the following in his Aug. 26, 2012 article “Golden Instability,” available at

“[A]nyone who believes that the gold standard era was marked by price stability, or for that matter any kind of stability, just hasn’t looked at the evidence. The fact is that prices have been far more stable under that dangerous inflationist Ben Bernanke than they ever were when gold ruled.

I’d like to offer a different take. There is a remarkably widespread view that at least gold has had stable purchasing power. But nothing could be further from the truth…

[There is] a pretty clear (and economically understandable) relationship between the real price of gold and the real interest rate: when real rates are low, real gold prices are high.

And when are real rates low? High inflation can do that, as it did in the late 1970s; but so can a severe economic slump due to a deleveraging shock, as in recent years.

What does that tell us about how a gold standard would work? Faced with the kind of shock we’ve just experienced, the real price of gold would ‘want’ to rise. But under a gold standard, the nominal price of gold would be fixed, so the only way that could happen would be through a fall in the general price level: deflation.

So if we’d had a gold standard operating in this crisis, there would have been powerful deflationary forces at work; not exactly what the doctor ordered.

The truth is that returning to gold is an almost comically (and cosmically) bad idea.”

Aug. 26, 2012 - Paul Krugman, PhD

Con 8

Ben Bernanke, PhD, Chairman of the Board of Governors of the Federal Reserve System, stated the following in his Mar. 20, 2012 lecture “The Federal Reserve and the Financial Crisis: Origins and Mission of the Federal Reserve,” available on the Federal Reserve website:

“[O]ne of the strengths that people cite for the gold standard is that it creates a stable value for the currency. It creates a stable inflation, and that’s true over very long periods. But over shorter periods, maybe up to 5 or 10 years, you can actually have a lot of inflation, rising prices, or deflation, falling prices, in a gold standard. And the reason is that in a gold standard, the amount of money in the economy varies according to things like gold strikes. So for example, in the United States, if gold was discovered in California and the amount of gold in the economy goes up, that will cause an inflation, whereas if the economy is growing faster and there’s a shortage of gold, that will cause a deflation. So over shorter periods of time, you frequently had both inflations and deflations…

I think though that the gold standard would not be feasible for both practical reasons and policy reasons. On the practical side, it is just a simple fact there is not enough gold to meet the needs of a global gold standard and achieving that much gold would be very expensive. In a modern world, the commitment to the gold standard would mean that we are swearing that under no circumstances, no matter how bad unemployment gets, are we going to do anything about it using monetary policy… So I understand the impulse but I think if you look at actual history, you’ll see that the gold standard didn’t work that well and it worked particularly poorly after World War I. Indeed, well I won’t go into it, there’s a good bit of evidence that the gold standard was one of the main reasons that the depression was so deep and long. And a striking fact is that countries that left the gold standard early and gave themselves flexibility on monetary policy recovered much more quickly.”

Mar. 20, 2012 - Ben Bernanke, PhD

Con 9

Frederic S. Mishkin, PhD, Alfred Lerner Professor of Banking and Financial Institutions at Columbia Business School, stated the following during the Mar. 13, 2013 Intelligence Squared debate “America Doesn’t Need a Strong Dollar Policy,” available on the Intelligence Squared Debates website:

“I’m not a big fan of the gold standard…

[W]hen we actually look at the technology of actually producing stable inflation, the idea that in fact we should go back to the horse and buggy and go back to the gold standard, I think doesn’t fly.

[T]he variability of inflation was much higher during the gold standard period than we have now. Now what did happen in that period, and one of the problems here was, that you [were] actually very much affected by acts of God.

So indeed we actually had a deflationary period… from 1880 to about 1896, because they couldn’t find any gold. Then we had the Klondike and South Africa and actually there was inflation, because there were huge amounts of gold found in the ground…

During the gold standard, the price level went up, went down. Now you are right, that over very long rises, over a 40 year period, there was no change in price level. That’s the good news. The bad news is, that horizons are not 40 years. As Keynes said, in the long run, we’re all dead…

During the gold standard era… [w]e had financial crises about every 10 to 20 years…

[T]he period of the classical gold standard… was not a period of high growth.”

Mar. 13, 2013 - Frederic S. Mishkin, PhD

Con 10

Paul Heise, PhD, Professor Emeritus of Economics at Lebanon Valley College, stated the following in his Nov. 21, 2012 article “The Gold Standard Isn’t Good as Gold,” available at

“If America were on the gold standard, there would be real constraints on spending, since the U.S. Treasury would only be able to spend what it could borrow or collect in taxes. The Federal Reserve system, in the same way, would only be able to supply money in proportion to the gold it has backing that currency…

With a fiat money, the Federal Reserve can create and loan trillions of dollars to the business community when those dollars are needed in the midst of a financial crisis, as in 2008. The U.S. Treasury can run fiscal deficits of whatever size is needed to put the unemployed to work…

Thank God we are not on the gold standard. If we were, all of those horrible fears would be justified. We would have to institute austerity budgeting, deleverage credit, increase taxes and tighten the money supply…

With a fiat currency, we can and should create the buying power necessary to put all the people to work, increase national output and make everyone better off. Issuing this money will not cause inflation unless we are already at full employment.”

Nov. 21, 2012 - Paul A. Heise, PhD