I have written many articles about Gold, about the Unadulterated Gold Standard, about the components of a Gold based economy. Perhaps it’s time for a bit of a ‘reality check.’ Is the very idea of Gold money, the very idea of honest money in an honest society Utopian? Especially in this day and age, an age of the big lie, of tyrannical governments, of crony capitalism, of loss of human vitality…
After all, families run and have always run without money, except as needed to deal with the outside world. Same with the extended family; work is done, responsibilities shared, but money never changes hands. Why does this kind of very human interaction have to be limited to families, or at best to small tribes; why can’t the whole world run this way? Why not a world without money, with only the best interest of all as the driver? Why a ‘profit driven’, money based economy?
Many attempts have been made in just such efforts; efforts to replace the money based economy with an economy based on altruism, on human understanding, on shared responsibilities… the classical Marxist cry ‘from all according to their ability, to all according to their need’. Indeed, communal living has been tried on many scales, many times, from small ‘hippie’ communes to the great socialist experiments of Soviet Russia, of Communist China. The very same socialist experiment is now being tried in the formerly capitalist USA.
All these attempts have failed dismally; more than dismally, have failed tragically and with lethal consequences for hundreds of millions of innocent human beings; in Stalin’s five year plans, Mao’s Cultural Revolution… and perhaps soon in the USA’s ObamaCare as well. Why do these social experiments fail… and why does Humanity keep trying them, in spite of repeated tragic failures?
Why these Utopian experiments fail is easy to see, if we but choose to look and see the truth; the idea that what works in a family or small tribe can be scaled up without limit is Utopian. It is a false belief, and a lethal belief. Sociologists have researched this very topic; money-free societies can exist, do exist, direct democracy can exist, does exist, in communities of up to about 250 people. Once this number is exceeded, the family based, altruism based system starts to break down.
No rocket science or brain surgery is needed to see why; in a small group, every one knows every one else; knows who to trust, knows who is a good leader, knows who is a dead-beat… and the family connection brings forgiveness to relationships. As the group grows, it becomes harder to know whom to trust, whom to vote for… and much less forgiveness is given to strangers than to ‘Aunt Mindy’ or ‘Uncle Joe’.
The effort to scale up small scale communities to thousands, indeed millions, is doomed to fail. The hard reality is that a different system must be used to enable society at large to survive; if we don’t know who is making a promise, if we don’t know whether the promise maker can be trusted or not, the system itself must generate trust. Without trust, society breaks down and civilizations collapse.
Fiat currency is always and everywhere a promise; we don’t know, indeed cannot know if the promise maker is to be trusted. After all, Ben Bernanke is not our intimately known ‘Uncle Joe’… and Janet Yellen is not our ‘Aunt Mindy’. We cannot trust them, as we do not know them… we only know stories that are spread about them… stories that are mainly ‘spin’… i.e. mainly lies.
We do not have an intimate knowledge of their personality, their mindset, their belief systems; we don’t have a long term history of direct interaction with them. If we do trust them, we are being naïve; and naivety generally leads to trouble… just as Utopian social experiments lead to trouble.
No system based on trust can work, unless there are solid grounds for giving trust; either intimate knowledge of the players based on living in close proximity, as in an extended family, or a strong case of common interest. The interests of Central Bankers bear very little commonality with the interests of the average wage earner; and I suggest very few people on this planet have lived as part of Bernanke’s or Yellen’s family… extended or otherwise.
So we come to it; the Fiat system cannot be trusted, as the purveyors of the system cannot be trusted. The very idea of trusting a Fiat system is Utopian, and therefore lethal. Only a system that is inherently trustworthy, and is not dependent on the promises of either Bernanke or Yellen or of any other power seeker can possibly work. Only a system that is not under the control of and cannot be controlled by any ‘special interest’ can be trusted.
Of course, there is such a trustworthy system, a system not controlled by any special interest; it’s called the Unadulterated Gold Standard. Gold is not a promise, but a present good, a ‘bird in the hand’ vs. a promise of ‘two birds in the bush’. Gold is the touchstone, the acid test of any promise ever made. Gold is the ultimate extinguisher of debt; that is Gold fulfills any economic promise made.
A bond is a promise; and if redeemed in Gold, a promise that proves itself to be true. A Real Bill is a promise; and if redeemed in Gold, a promise that proves itself to be true. A bank note is a promise; and if redeemed in Gold, a promise that proves itself to be true. A promise that is ‘redeemed’ in another promise is proven to be what? Proven to be nothing but a lie.
Fiat currency is a lie, Fiat bank notes are lies, Fiat denominated bonds are lies… an economy based on Fiat is an economy based on lies. That is where we are today, living under a system based on lies… and the results are starting to show. Just as the lies of the Utopian socialist experiments in the USSR and China showed up… in the form of war, famine, death… so the results of living under a Fiat system of lies are starting to show up.
Is war far away? Is famine far away? I suggest both are already upon us. Thousands are dying in wars at this very moment… hundreds of thousands have died in the last few years… and the death of millions is in sight. The push of a button by a power mad psychopath would ignite the conflagration.
One third of the world population is already hungry; and not just in the so called ‘underdeveloped nations.’ In the UK thousands of retirees are facing a choice; freeze or starve. These poor innocents cannot afford both food and fuel. In the meantime, the power mad psychopath running the US government is busy shutting down power plants, pushing energy costs to the sky. How many American retirees already face the same choice; freeze or starve?
Why Humanity keeps trying Utopian experiments is a conundrum; the special interests, the power seekers, the parasites spread reams of propaganda promoting their Fiat system; the very heart of the ‘big lie’… but why do people swallow the lie? Is it as simple as Santayana’s famous ‘those who fail to learn the lessons of history are doomed to repeat them’… or is it more than that? Why do we fail to see the truth? Do we fear to see the truth?
The truth will set you free. Do right and fear not.
Rudy J. Fritsch