GOP: In Gold We Trust

About 2,000 words into the Republican Party’s 32,000-word platform there’s a big, deferential shout-out to Ron Paul and his Tea Party torchbearers. The section is titled “Inflation and the Federal Reserve,” and it makes the case for one of the 77-year-old congressman’s biggest policy desires: to return the U.S. to the gold standard by setting a fixed dollar price for an ounce of the metal, using that to determine the value of the currency. The Fed wouldn’t be able to increase the money supply (print more currency) without first buying more gold.

The section begins by raising the bugaboo of inflation, which “diminishes the purchasing power of the dollar at home and abroad and is a hidden tax on the American people.” True statement, and one that would be worth addressing if it were actually happening. The economy has a lot of problems right now, but inflation isn’t one of them. Prices are increasing by a little more than 2 percent a year, which is right in the range the Fed wants. Nonetheless, the GOP platform uses the risk of inflation to make the roundabout case for a return to the gold standard.