Friday items: Woodhill discounts the Dow for gold; Lehrman and Grant testify on monetary policy; Geithner supports a world reserve currency.

From The Weekly Standard, Lewis Lehrman argues for a gold-backed dollar.

At Forbes, Louis Woodhill measures the Dow against the gold price.

U.S. Rep. Ron Paul (TX) held hearings yesterday on Federal Reserve policy and rising prices, featuring Lewis Lehrman and James Grant:



(Parts 2-8 of the hearing, here, here, here, here, here, here and here.)

(Lehrman’s written submission here, Grant’s here. H/t: Ralph Benko, Rich Danker.)

The Telegraph (UK) reports world markets were stunned by Treasury Secretary Tim Geithner’s suggestion that the U.S. supports a global reserve currency.

From last week, The WSJ recounts a hapless Fed official’s explanation to working people that price inflation is under control.

So Mr. Dudley tried to explain that other prices are falling. "Today you can buy an iPad 2 that costs the same as an iPad 1 that is twice as powerful," he said. "You have to look at the prices of all things."

Reuters reports that this "prompted guffaws and widespread murmuring from the audience," with someone quipping, "I can't eat an iPad." Another attendee asked, "When was the last time, sir, that you went grocery shopping?"

At RCM, Cato’s Kevin Dowd and Martin Hutchison tie dollar volatility to the recent boom/bust cycles and suggest investors are pulling out of the U.S. as a result.

From Future of Capitalism, Ira Stoll notes the Ways and Means Committee Chairman wants a top tax rate of 25 percent.

At Democracy Journal, supply-side critic Jonathan Chait laments the GOP’s refusal to raise tax rates.

We can identify three phases of supply-side craziness in Republican Party history. In phase one, the Republican establishment greeted supply-side economics with incredulity. The messianism and insouciant disregard for sound fiscal principles sounded more like a nutty left-wing scheme than anything a Dwight Eisenhower or even a Barry Goldwater might recognize. George H.W. Bush called it “voodoo economics.” A great blaze of tax cutting at the outset of the Reagan presidency quickly produced massive deficits, and the Reagan Administration — still dominated by an older generation of Republicans — quickly retrenched. It quietly raised taxes in 1982 and 1983, and then in 1986—aghast at the massive corporate tax loopholes that had grown out of its initial tax cuts—agreed to a tax reform that, even in the course of lowering nominal rates, shifted a larger share of the tax burden onto the rich by sweeping the tax code of subsidies for the wealthy.

Through the next decade, in phase two, the Republican Party stayed committed to anti-tax absolutism in rhetoric, but it remained largely tethered to fiscal reality in practice. In 1990, George H.W. Bush agreed to a major deficit-reduction package, including substantial spending cuts, in return for a small hike in the top marginal income tax rate, from 28 to 31 percent….

Which brings us to phase three. Over the last 20 years, the penetration of taxophobia within the Republican Party has been total. Reducing taxes, especially taxes on the rich, has been enshrined as the party’s unquestioned central policy goal. Virtually all Republicans at the national level have signed a pledge concocted by anti-tax fanatic Grover Norquist pledging never, under any circumstances, to support higher taxes. No such pledge exists for spending.

On Forbes, Peter Ferrara suggests Social Security accounts are still a viable option.

From Fiscal Times, Bruce Bartlett argues Tea Party Republicans are blowing it by focusing on small, unpopular budget cuts.