My letter to the Finacial Time, London re: Who controls money should be the key issue in the US presidential election

From: patrickbarron@msn.com
To: letters.editor@ft.com
Subject: Who controls money should be the key issue in the US presidential election
Date: Sat, 25 Aug 2012 16:48:29 -0400

Re: Republicans eye return to gold standard

Dear Sirs:
The subject of your page one lead article on Friday, August 24th should be the key issue in this year's US presidential election. This short paragraph in your article states the case for the status quo vs. a gold standard:

"A return to a fixed money supply would remove the central bank's ability to offset demand shocks by varying interest rates. That could mean a more volatile economy and higher average unemployment."

The Austrian school of economics postulates the opposite of this claim. It is central bank manipulation of the interest rate that causes economic disequilibrium in the form of malinvestment that must be shed eventually, causing high unemployment in the process (what is commonly called a recession). In addition to unemployment and poverty, other economic problems such as higher prices and increased debt stem from state control of money. Furthermore, central banks finance the hope-destroying welfare state and, most perniciously, the warfare state. Central banks' incessant money pumping has resulted in a loss of liberty that took the Anglo Saxon world centuries to achieve. Undoubtedly, the key issue of our times is the debate over state control of money through central banks versus market produced money willingly accepted by the people.

Patrick Barron
Adjunct Instructor in Austrian Economics
Department of Economics
University of Iowa, USA