Thursday update: Lehrman on the gold standard; Goldman says don't panic; Jacoby on immigration.

In The American Spectator, Lew Lehrman suggests the choice of monetary policy is between Robert Mundell’s idea for an exchange rate peg between the dollar and euro versus the gold standard.

From Asia Times, David Goldman predicts slow growth but sees no reason to panic.

At The American Spectator, Peter Ferrara sees the US falling into depression if the Bush tax rates lapse after 2012.

On The Kudlow Report, Tamar Jacoby debates the economics of immigration:




In The WSJ, Dan Henninger notes the President’s political weakness on the economy and the strength of Tim Pawlenty’s pro-growth message.

At The NYT, Matt Bai suggests the President’s reelection message, don’t change horses in midstream, is a loser.

On Future of Capitalism, Ira Stoll reports McCain economist Doug Holtz-Eakin saying 5% annual growth rates are impossible.

On Kudlow, guests discuss possible deflationary pressures in China:




At the liberal Mother Jones, Kevin Drum suggests the Left could like supply-side economics if it raised revenues as fast as advertised.

On Think Progress, Matt Yglesias takes up Drum’s point but argues the Left won’t support tax cuts due to inequality concerns.

In The NYT, Jackie Calmes reports the flagging economy is leading Democrats to push for additional spending stimulus despite high deficits.

At TNR, Jonathan Chait notes the President’s consideration of a payroll tax cut.

IBD argues Keynesian spending is ineffective.

On TGSN, Ralph Benko notes Daniel Webster’s support for gold and silver as money.

The Des Moines Register reports Herman Cain having second thoughts on the gold standard. (Hat tip: Ralph Benko).

From Project Syndicate, Raghuram Rajan argues loose money is bad for the economy.

Monday items.

At NRO’s Corner, Alan Reynolds points out that even with a static analysis, raising taxes on the wealthy would pay for nine days of the federal deficit.

At Forbes, John Tamny explains that the estate tax encourages the rich to consume rather than save.

From the weekend, Larry Kudlow sees the Tea-Party as good for markets.

The Heritage Foundation forecasts the negative impact of the President’s proposed tax increases.

On Forbes, Steve Forbes interviews Burton Malkiel (part two).

At AEI’s The American, Raghuram Rajan responds to Paul Krugman’s recent critique.

On Forbes, Rich Karlgaard covers a union boss accusing businesses of treason for not hiring or investing.

At Reason, Tim Cavanaugh cites Brian Domitrovic’s Econoclasts in comparing the current malaise to the 1970s.

In The NYT, GMU’s Tyler Cowen advocates inflation, despite rising gold and commodity prices.

On Daily Markets, Cam Hui blames the international gold standard for the Great Depression.

In his 1999 Nobel Prize lecture, Robert Mundell suggested it was mismanagement of the gold standard that caused the crisis.

World War I made gold unstable. The instability began when deficit spending pushed the European belligerents off the gold standard, and gold came to the United States, where the newly-created Federal Reserve System monetized it, doubling the dollar price level and halving the real value of gold. The instability continued when, after the war, the Federal Reserve engineered a dramatic deflation in the recession of 1920-21, bringing the dollar (and gold) price level 60 percent of the way back toward the prewar equilibrium, a level at which the Federal Reserve kept it until 1929.

It was in this milieu that the rest of the world, led by Germany, Britain and France, returned to the gold standard. The problem was that, with world (dollar) prices still 40 percent above their prewar equilibrium, the real value of gold reserves and supplies was proportionately smaller. At the same time monetary gold was badly distributed, with half of it in the United States. In addition, uncertainty over exchange rates and reparations (which were fixed in gold) increased the demand for reserves. In the face of this situation would not the increased demand for gold brought about by a return to the gold standard bring on a deflation? A few economists, like Charles Rist of France, Ludwig von Mises of Austria and Gustav Cassel of Sweden, thought it would.