Monday items: Multiple authors mark the fiat dollar's 40th birthday; Tamny debates the dollar; Buffett advocates higher taxes.

A number of articles today mark the 40th anniversary of President Nixon severing the dollar from gold:

• The WSJ, Lewis Lehrman
• Forbes, Brian Domitrovic
• The Washington Examiner, Jeffrey Bell
• CNBC, Ralph Benko
• RCM, John Tamny
• TGSN, an open letter, multiple signatories
• The Telegraph (UK), Edmund Conway
• AEI’s The American, John A. Allison and John L. Chapman
• The NY Sun, editorial page

On The Kudlow Report, John Tamny debates gold and the dollar:




The Heritage Foundation advertises an October conference on dollar stability.

On Asia Times, David Goldman defends Wall Street against populist scapegoating.

In The NYT, billionaire investor Warren Buffett advocates higher taxes on the wealthy.

Also on Kudlow, Stephen Moore discusses Buffett’s article:

 


From The Freeman, Mark Skousen disputes the idea that consumer spending drives the economy.

At COAL, Paul Krugman sees inflation fears fading.

Weekend round up: Lewis on gold linked currency; Mundell says gold could play a role in monetary reform; Lowry admonishes the GOP to focus on growth.

The new book to buy – ‘It Shines for All’: The Gold Standard Editorials of The NY Sun.

On Forbes, Nathan Lewis distinguishes between currencies linked to gold vs. backed by gold.

At a leading website in primary state Iowa, Ralph Benko argues the gold standard advantages main street rather than wall street.

On Bloomberg, Robert Mundell suggests monetary reform featuring fixed exchange rates among major currencies, with gold as an intermediary:

FOX: Now, you've written about the role of gold in the world economy, Professor Mundell. Do you think that we're going to see any kind of return to the gold standard?

MUNDELL: I - nothing like the gold standard that existed before 1914. But there could be a kind of Bretton Woods type of gold standard where the price of gold was fixed for central banks and they could use gold as an asset to trade central banks. The great advantage of that was that gold is it’s nobody's liability and it can't be printed. So it has a strength and confidence that people trust. So if you had not just the United States, but the United States and the euro tied together to each other and to gold, gold might be the intermediary, and then with the other important currencies, like the yen and the Chinese yuan and the British pound, all tied together as a kind of new SDR, I think that would be one way the world could move forward toward a better monetary system.

At NRO, Larry Kudlow recounts House Republican leader Eric Cantor’s (VA) focus on jobs and growth.

From Forbes, Bret Swanson explains the budget ramifications of 2, 2.5, 3 and 4 percent annual growth:



In a bellwether column, National Review editor Rich Lowry admonishes the GOP to focus on economic growth:

The unemployment rate is still at 9 percent. According to Gallup, 35 percent of people say the economy is their top concern, and 22 percent say jobs. Just 12 percent cite the federal deficit and debt. Republicans have taken the top concern of roughly one-eighth of the public and made it their existential cause. On top of that, they have taken a subset of the debt issue, the long-term fiscal sustainability of Medicare, and made it their calling card.

On The Kudlow Report, Art Laffer outlines a tax reform agenda to supercharge economic growth:




From Bloomberg, Stephen L. Carter suggests small and medium size businesses are paralyzed by regulatory uncertainty.

At New World Economics, Nathan Lewis continues his explanation of gold’s great long-term stability.

From last year, Chris Mahoney of Granite Springs Asset Management speculates that China could use its dollar assets to peg the euro to the dollar, and by extension to the yuan.

IBD notes gains from international trade.

Weekend update: NY Sun reports on NYC gold standard debate; Shelton suggests gold to stabilize the financial system; Kudlow doubts GOP growth agenda.

The NY Sun reports on two extraordinary NYC debates on gold and the gold standard, including one attended by almost 1,000 people.

In Forbes, Nathan Lewis explains that a gold standard doesn’t require a 100% gold reserves.

Euronews reports on a Kazakhstan conference that featured Judy Shelton and Robert Mundell:

What is needed most is global financial stability. Many worry that the dollar-centred monetary system is sick, leaving some to present radical proposals. Judy Shelton from Atlas Economic Research Foundation, a US think tank is one of these people: “We can’t have a sound monetary policy until we have sound finances. I hope the future is to restore soundness to the dollar and even possibly link it to gold, which even though that is discussed as somewhat of an extreme measure, it’s fairly radical. But you’re getting a strong movement in the United States, and I think around the world. There is plenty of interest in gold as a possible unit of account and maybe the basis of a modern global gold standard.”

After a decade of dollar decline, The Washington Post reports monetary authorities may not be serious about their strong dollar policy.

At NRO, Larry Kudlow doesn’t see a clear growth message from the GOP presidential candidates.

From Forbes, Peter Ferrara notes the performance differences between Reaganomics and Obamanomics.

The NYT reports congressional Republicans backing down on their bid to reform Medicare.

In The Telegraph (UK), Andrew Lilico explains the Federal Reserve’s role in triggering revolts the Arab spring revolutions:




On NRO, Douglas Holtz-Eakin opposes raising taxes on the wealthy.

At The Washington Post, Jennifer Rubin suggests the U.S. can’t tax the wealthy much more.

Cato’s Alan Reynolds explains that fewer people pay more of the taxes.

On The WSJ, Stephen Moore notes wealthy advocates of higher tax rates don’t voluntarily pay more.

In Forbes, Reuven Brenner assesses different methods of taxation.

Thursday round up: The WSJ, NY Sun, Lipsky and Goldman critique Bernanke; Kudlow sees stagflation; Henninger on the President's tax rhetoric.

The WSJ reviews Fed Chairman Bernanke’s press conference:

By our lights Mr. Bernanke's least credible moment came on the dollar. The Chairman repeated the bromide that preserving the purchasing power of the greenback is a core central bank goal, which he said it will accomplish by keeping inflation low and reviving growth to attract capital from abroad.

Mr. Bernanke had clearly worked out his dollar remarks with Treasury Secretary Tim Geithner, whom he saluted for saying a day earlier that "our policy has been and will always be, as long at least as I'm in this job, that a strong dollar is in our interests as a country."

The only trouble is that no one believes this. Capital has been fleeing dollar-denominated assets for months because investors believe that the Fed and Treasury are at best agnostic about dollar devaluation, at worst playing beggar-thy-neighbor to boost U.S. exports and force China to revalue its currency.

At Forbes, Seth Lipsky poses additional questions for Fed Chairman Bernanke.

The NY Sun laments Bernanke’s failure to mention gold.

On The Kudlow Report, David Goldman discusses Bernanke’s performance:




The OC Register cites Jude Wanniski on the 15:1 relationship between gold and oil prices.

On NRO, Larry Kudlow argues that stagflation is back.

In The WSJ, Dan Henninger scolds the President for his tax-the-rich rhetoric.

From The American Spectator, Peter Ferrara suggests the President doesn’t understand economics.

On Kudlow, Stephen Moore discusses the economy’s impact on the President’s re-election:




On Forbes, Louis Woodhill reports Greece is likely to default on its debt but can get back on track with pro-growth measures and sticking with the euro.

The Economist applauds China for its appreciating currency.

At Economic Policy Journal, Robert Wenzel notes per capita gold reserves (h/t: Free Banking):




Cato offers Lew Lehrman and Ron Paul’s book, The Case for Gold.

Monday round up: Benko suggests the Fed is keeping unemployment high; Kessler says Obamacare penalizes work; Mitchell on the GOP tax debate.

At Forbes, Ralph Benko suggests Fed policy is keeping unemployment high (with a kind mention of this blog).

From The WSJ, Stanford’s Daniel Kessler explains that Obamacare imposes substantial penalties on working.

Cato’s Dan Mitchell sides with Grover Norquist against Sen. Tom Coburn (OK) on the need to cut taxes commensurate with eliminating tax expenditures.

On The Kudlow Report, Vince Reinhart discusses QE2’s end:




The NY Sun explains to the President that his weak dollar, not speculators, is behind high oil prices.

At International Liberty, Dan Mitchell expresses cautious optimism at the President’s proposed corporate tax rate reduction.

From Mercatus, Veronique de Rugy and Jason Fichtner report federal income taxes paid by quintile:

At The American Thinker, Chuck Roger rebuts Donald Trump’s protectionist rhetoric.

On Forbes, Brink Lindsey argues for innovation and growth.

From The NYT, David Stockman shows no appreciation for pro-growth economics, advocating painful tax increases on the middle class and wealthy, increased capital gains taxes, and means testing entitlements. On the plus side, he does favor a sound dollar:

The culprit here was the combination of ultralow rates of interest at the Federal Reserve and ultralow rates of taxation on capital gains. The former destroyed the nation’s capital markets, fueling huge growth in household and business debt, serial asset bubbles and endless leveraged speculation in equities, commodities, currencies and other assets.

At the same time, the nearly untaxed windfall gains accrued to pure financial speculators, not the backyard inventors envisioned by the Republican-inspired capital-gains tax revolution of 1978. And they happened in an environment of essentially zero inflation, the opposite of the double-digit inflation that justified a lower tax rate on capital gains back then — but which is now simply an obsolete tax subsidy to the rich.

Also in The Times, Paul Krugman wants tax increases.

Weekend round up.

On RCM, John Tamny argues lower housing prices are good for the economy.

Also on RCM, Larry Kudlow advocates pro-growth tactics to improve the employment picture.

From The Heritage Foundation, Steve Forbes makes the moral case for capitalism:





The NY Sun advocates an audit of Federal Reserve bail outs.

In The WSJ, John Fund reports the Americans prefer spending cuts to tax increases by 59% to 30%.

The Huffington Post reports just how grim the unemployment data really is:



At The San Francisco Chronicle, Lisa Smith summarizes the Laffer Curve.

From AEI’s The American, Donald Losman rejects deflation predictions, citing rising gold.

Also in The Journal, Holman Jenkins notes weakening support for the euro among former supporters.

Even faced with maximal turmoil, Europeans are still trying to have it both ways. The bailout to-ing and fro-ing by European authorities is conditioned largely on their unwillingness to choose between conflicting goals—on one hand, a continent of competitive and open economies; on the other hand, a "social model" that cushions established interest groups and voting blocs from the stress of competition.

A very different approach to managing the current crisis is imaginable. Put the European Central Bank in charge of printing liquidity to prop up the continent's banks. (Right now it's printing liquidity to prop up governments, which are propping up the banks.) Let badly indebted governments go into default and negotiate more manageable terms with their creditors (mostly banks). Let politicians in these countries invest their limited political capital in promoting growth rather than austerity. Let them cut taxes and deregulate their labor markets.

This would certainly sound preferable to voters than job-killing tax hikes and spending cuts to appease far-off German taxpayers who are being dragooned into refinancing their insupportable debts. The most encompassing description of Europe's problem, after all, is the one not mentioned enough: a shortage of growth.

Friday items.

A FreedomWorks press release says the organization will co-sponsor a panel discussion in Washington this week on sound money.

From Wednesday, Larry Kudlow reports on the stock market’s progress.

On The Kudlow Report, Stephen Moore analyzes the high jobless numbers:




At Encima Global, David Malpass assesses the jobless report.

On RCM, John Tamny takes a counter intuitive view of a US-debt default.

At Reason, Nick Gillespie downplays the role of economic growth in the current deficit:




The NY Sun notes silver's recent rise.

At National Review, Rich Lowry praises entrepreneurial innovation.

From the Mises Institute, George Selgin suggests the Fed has been a failure:




In The WSJ, John H. Cochrane suggests national debt defaults are preferable to bailouts.

On NRO, Kevin Williamson scolds Americans for Tax Reform for opposing the Simpson-Bowles tax plan.

Monday items.

In The Weekly Standard, Jeffrey Bell and Sean Feiler argue the GOP doesn’t understand the monetary roots of the economic crisis.

At the moment, Republican leaders and policy elites are advancing exclusively fiscal solutions that address only the government response to the economic crisis and not the crisis itself. Fiscal deficits did not create the crisis, and reducing deficits won’t put our economy on a stable footing. From its inception in 2007 right up to the present, the crisis derived from the interaction between excessive investment leverage and dysfunctional interest-rate policy—in other words, a predominantly monetary phenomenon, albeit one that has had grave fiscal consequences.

As long as the GOP enjoys the luxury of being the only alternative to Barack Obama and the Democrats, the party is understandably reluctant to delve into the murky depths of monetary policy. But after November 2, the Republicans’ role will change. They could do worse than pay attention to the only public official, elected or unelected, who is speaking out against current monetary policy, telling anyone who will listen—including an increasingly impatient Tea Party movement—that the root of the crisis is monetary.

On Forbes, John Tamny suggests the President’s best chance for a comeback requires rejecting devaluationist ideas.

At CNBC, Peter Morici and former GW Bush official Tony Fratto discuss China’s currency:



At Classic Capital, Wayne Jett explains the role U.S. monetary authorities have played in destabilizing the world financial system.

Monetary inflation is an accomplished fact, and product prices will adjust accordingly as an added variant of supply-demand signals. So far, the CPI has adjusted only 16.6% since 2003, leaving nearly 60% in price rises still to be realized. This means price inflation of 6-12% annually over the next five to ten years is already built into the dollar. Talk of “deflation” is either ignorant or deceptive, because any downward pressure on prices comes not from monetary policy but from falling demand in relation to supplies of goods and services.

China pegs its currency to the dollar to avoid loss of U. S. markets. Duplicating the Fed’s money creation causes worse inflation in China than the Fed creates in the U. S. Congress was set to make matters worse in September by voting on a bill to allow penalties to be imposed on Chinese producers to compensate U. S. producers for China’s “weak” currency, but adjourned to avoid voting on extension of the Bush tax cuts.

The world’s best monetary theorist, Robert A. Mundell, declared such U. S. penalties would create a “disaster” which would create even greater instability in international relations. He further warned that the China penalty bill distracts from attention to the primary source of monetary instability, which is devaluation of the dollar relative to the euro. The recent dollar/euro ratio, Mundell declared, “is a terrible thing for the world economy. We’ve never been in this unstable position in the entire currency history of 3,000 years.” Since Mundell spoke in September, the dollar/euro ratio has worsened to $1.40, provoking European retaliation. Japan, too, is being priced out of the U. S. market, with the dollar now worth only 82 yen.

From last month, The NY Sun recounts a prominent investor’s warning on the dollar and gold.

On Forbes, Steve Forbes interviews Albania’s prime minister about the flat tax.

At The Money Illusion, Scott Sumner discusses tax rates and incentives.

Also on The Weekly Standard, Matthew Continetti warns Republicans not to emphasize austerity over growth.

In The American Spectator, Stephen Moore debunks Green Jobs.

World Net Daily reports on financial industry calls for a single world currency.

On The NY Times, the Heritage Foundation’s Derek Scissors opposes Chinese devaluation.

Thursday items.

On RCM, Charles Kadlec explains that higher tax rates on the rich are equivalent to domestic tariffs on doing business with high-income individuals and small businesses.

The NY Sun editorializes on the history of JFK, Nixon and gold.

On The Kudlow Report, Larry discusses the weak dollar’s impact on the oil price:



In Foreign Policy, Keynesian Barry Eichengreen analyzes the present currency war.

From 2004, Jude Wanniski and Eichengreen correspond on currency and gold.

Larry Kudlow wonders if this week’s Gallup poll led to the market rally.

At WSJ video, Stephen Moore examines job losses:



At The Journal, Tadashi Nakamae suggests the U.S. is repeating Japan’s monetary errors.

From 2009, Alan Reynolds debunks Keynesian analysis of Japan’s deflation.

On CNBC’s Netnet, Ash Bennington analyzes Art Laffer’s recent WSJ piece.

At Intermex Financial, Ricardo Valuenzuela posts a 2005 Wanniski book review on American entrepreneurship in Jude’s memory.

Thursday items.

The NY Sun rolls its eyes at Alan Greenspan's recent remarks that gold is the canary in the currency coal mine.

At Investor's Business Daily, Cato's Alan Reynolds analyzes Keynesian spending vs supply-side tax cuts.

The WSJ's Dan Henninger sees spending as the election's main issue.

At The Kudlow Report, Larry examines Japan's currency fluctuations.

At The WSJ, a collection of conservative Keynesians and monetarists offer a mixed agenda for economic growth (cutting spending and entitlements, freezing regulations, and maintaining current tax rates). Most problematic is the fifth point, which calls for a Taylor Rule-style monetary policy rather than a commodity price rule.

The WSJ reports on Treasury Secretary Tim Geithner's call for a higher yuan at a House hearing.

At The Money Illusion, Scott Sumner points out that currency revaluations don't necessarily improve trade deficits.

Steve Forbes discusses successful investment strategies of the past decade.

A note on David Malpass's Senate race: Earlier this week, supply-sider Malpass lost his Republican primary bid for the U.S. Senate in New York. While I followed the campaign from afar, I can't help but note that Malpass seemed to cast himself most clearly as a spending hawk, rather than focusing his campaign on tax cutting, sound money and economic growth. Running as a budget cutter, Malpass was one of the crowd rather than a standout candidate for growth; an odd strategy.