The Freeman 1972 - The Ludwig von Mises Institute

1972 IN SEARCH OF A NEW MONETARY ORDER 11ministrations yielding to popularpressures for government largessand economic redistribution. Nosuch currency can serve for longas the international reserve currencyto which all others can repair.The U.S. dollar is no exception.In the chaotic conditions of late1971, the world may still have thefollowing options:(1) It may continue on its presentroad of fiat money and inflation,government manipulation ofexchange rates, trade restrictions,and exchange controls. The goal is"national autonomy" in monetaryand fiscal policies, an essential objectivefor all forms of central economicplanning. On this road weare bound to suffer not only moreinflation and depreciation, but alsoa gradual disintegration of theworld economy and its division oflabor. Our ultimate destination isa world-wide depression.(2) Or the world may choose toturn off this road of self-destructionand seek stability in soundmoney. The very monetary authoritiesthat have created thechaos and are now sitting in judgmentover the, international monetaryorder must relinquish theirrights and powers over the people'smoney. This road leads to thevarious forms of gold standard,from the gold-exchange to thegold-bullion, and finally the goldcoinstandard. For gold is the onlyinternational money the quantityof which is limited by high costsof mining and the value of whichis independent of political aspirationsand policies. Only the goldstandard can afford monetary stabilityand peaceful internationalcooperation. ~IDEAS ONLIBERTYFreedom is the AnswerTHERE IS NOTHING wrong with money that freedom will not cure.This is another way of saying that the Good Society which manyreformers have sought by way of monetary reform' cannot beachieved that way; if it is ever to be achieved, it will be done byfreedom. So, then, the fight for sound money, to have meaning,must be related to the broader fight for freedom. It is only oneof the several battles that must be fought.F RAN K C HOD 0 R 0 v, from "Shackles of Gold"