One Nation Under Gold
Page 40
42. “An ounce of apartheid,” Berkshire Eagle, December 10, 1977.
43. Stephen J. Solarz, Journeys to War and Peace (Waltham, MA: Brandeis University Press, 2011), 82–83. Solarz’s timetable is difficult to resolve. He says he introduced the legislation in 1980; congressional records show him introducing a curb on South African investments (though nothing about the Krugerrand) in 1978. He says he talked to Ramaphosa about the bill before introducing it in 1980, but Ramaphosa did not actually form a miners’ union until 1982. These discrepancies do not seem to negate the overall thrust of Solarz’s claim that he took seriously the relationship between US gold purchases, apartheid, and the livelihood of South African miners.
Chapter 11: Goldbugs in Power
1. For an exhaustive background on the Jamaica settlement, see Tom de Vries, “Jamaica, or the Non-Reform of the International Monetary System,” Foreign Affairs, April 1, 1976.
2. Telephone interview with the author, December 15, 2015.
3. Even historians and biographers tend to overlook Helms’s advocacy for gold causes. The otherwise comprehensive 643-page biography of Helms, Righteous Warrior: Jesse Helms and the Rise of Modern Conservatism (New York: St. Martin’s Press, 2008), for example, never mentions Helms’s gold legislation efforts and achievements.
4. Henry Mark Holzer, “Can We Restore the Gold Clause?” Wall Street Journal, March 17, 1975. For the chronology of legislation around gold clause contracts, I am grateful to Holzer’s monograph The Gold Clause (Highlands Ranch, CO: Madison Press, 2014).
5. Milton Friedman to Senator Jesse Helms, July 30, 1976. Submitted into Congressional Record 122, part 25, September 28, 1976, 32956.
6. “Washington & Business: The U.S. Gold-Clause Legislation,” New York Times, October 20, 1977.
7. A year earlier, when Helms had tried but failed to get similar amendments attached to the bill readjusting the rules of the IMF and World Bank, he relayed his views on the topic in Senate report 94-1295, Amendment of the Bretton Woods Agreements Act and Other International Monetary Matters, September 22, 1976, 27ff. Ironically, a few years later Helms’s allies in the Reagan administration did not make Helms any happier. Despite Reagan’s initial hostility to IMF reauthorization, his administration came around to supporting it in 1982 to help stave off widespread default from debtor countries, including Argentina and Mexico. To pass that legislation, Reagan had to turn to Democrats in Congress for support.
8. “Reagan Advisers Tout a Return to Gold Standard,” Washington Post, July 31, 1980.
9. “Enemies of Gold,” Washington Post, August 5, 1981.
10. Report to the Congress of the Commission on the Role of Gold in the Domestic and International Monetary Systems (Washington, DC: March 1982), 2.
11. “An Urgent Return to the American System,” letter from Lyndon Larouche, January 8, 1982, in Report, 2:449.
12. Report to the Congress of the Commission on the Role of Gold in the Domestic and International Monetary Systems, 1.
13. “Gold Panel Off to Slow Start,” New York Times, September 19, 1981.
14. My account of the Gold Commission’s hearings and internal dynamics is deeply indebted to Anna Schwartz’s 1987 essay “Reflections on the Gold Commission Report,” a chapter in her monograph Money in Historical Perspective (Chicago: University of Chicago Press, 1987), part of a series by the National Bureau of Economic Research.
15. Lehrman wrote an essay in January 1980 called “Monetary Policy, the Federal Reserve System, and Gold,” which was distributed as a research paper by the investment bank Morgan Stanley.
16. Report to the Congress of the Commission on the Role of Gold in the Domestic and International Monetary Systems, 140.
17. “Fiscal Nostrums for Monetary Ills,” letter to the editor, Wall Street Journal, April 22, 1982.
18. The Reagan Diaries, vol. 1, ed. Douglas Brinkley (New York: HarperCollins, 2007), June 11, 1981 entry.
19. Murray Weidenbaum, Advising Reagan: Making Economic Policy, 1981–82: A Memoir (St. Louis: Washington University in St. Louis, 2005), 26.
20. Nomination of Alan Greenspan: Hearing Before the Committee on Banking, Housing, and Urban Affairs, United States Senate, 100th Congress, 1st session, July 21, 1987, 61.
21. Executive Order 12532 Prohibiting Trade and Certain Other Transactions Involving South Africa, September 9, 1985.
22. “Go for Gold,” The Economist, July 19, 1986, 11.
23. Details about the development of heap leaching at Carlin can be found in Jack Morris, Going For Gold: The History of Newmont Mining Corporation (Tuscaloosa: University of Alabama Press, 2010), ix–xiv.
24. “The Will Rogers Method,” Forbes, July 19, 1982, 42.
25. “Fool’s Gold,” Time, May 9, 1983.
26. Details of Bullion Reserve’s excesses can be found in the Senate testimony of his ex-wife, who was also working for the company. Commodity Investment Fraud II: Hearings Before the Permanent Subcommittee on Governmental Affairs, United States Senate, 98th Congress, 2nd session (Washington: U.S. General Printing Office, 1984), 56ff.
27. David J. Gilberg, “Precious Metals Trading: The Last Frontier of Unregulated Investment,” Washington and Lee Law Review 41, no. 3, 943–991.
28. For details of how the Hunt brothers were able to stay steps ahead of the CFTC, see Stephen Fay, Beyond Greed (New York: Viking Press, 1982).
29. Hearings Before the Permanent Subcommittee on Investigations of the Committee on Governmental Affairs, United States Senate, 97th Congress, 2nd session, February 23, 1982, 1–2.
30. “Futures Imperfect: Puppylike Watchdog Irks Some but Pleases Commodities Industry,” Wall Street Journal, August 2, 1984.
31. “Insurance Plan for Dealers Planned: Gold, Silver Bullion, Coins.” American Metal Market, November 29, 1984.
32. Fred Barnes and Morton Kondracke, Jack Kemp: The Bleeding-Heart Conservative Who Changed America (New York: Sentinel, 2015), 81.
33. It is fair to say that the Dole-Kemp ticket and the Republican Party in 1996 did not emphasize a gold standard. But as late as June of that year, Kemp urged the next president to “reinstate the dollar/gold link that was broken in 1971.” See Jack Kemp, “A Bipartisan Economic Agenda,” Wall Street Journal, June 18, 1996.
Chapter 12: God, Gold, and Guns
1. John Carney, “Glenn Beck’s Gold Endorsement Goes Too Far For Fox,” Business Insider, December 8, 2009, http://www.businessinsider.com/glenn-becks-gold-endorsement-goes-too-far-for-fox-2009-12; Bill Carter, “Glenn Beck’s Gold Deal Raising Questions at Fox,” New York Times, December 13, 2009, http://www.nytimes.com/2009/12/14/business/media/14beck.html?_r=1.
2. “As Seen on TV: An Investigation of Goldline International,” report presented by Congressman Anthony D. Weiner, May 17, 2010. Available at http://www.avaresearch.com/files/20100527200653.pdf.
3. Republican Platform 2012, p. 4.
4. Zachary Mider, “What Kind of Man Spends Millions to Elect Ted Cruz?” Bloomberg Politics, January 20, 2016; “Donald Trump Weighs in on Marijuana, Hillary Clinton, and Man Buns,” https://thescene.com/watch/gq/donald-trump-weighs-in-on-marijuana-hillary-clinton-and-man-buns.
5. Polls done for the advocacy group American Principles in Action showed majorities of Republican voters in Iowa, New Hampshire, and South Carolina favoring a return to a gold standard. The polls were conducted by Polling Co., Inc. It should be noted that these polls were not widely released to the public and were conducted on behalf of an organization that seeks to restore a gold standard, and so they should be read with a degree of skepticism. Nonetheless, their findings for Republican voters are not out of line with the national poll (see next note) or the behavior of Republican candidates in the 2012 race.
6. “Public Has Mixed Views of Return to Gold Standard,” Rasmussen Reports, October 21, 2011. The survey questioned 1,000 likely voters on October 18 and 19, 2011, and had a margin of error of +/– 3 percent.
7. See “Confidence in Institutions/Gallup H
istorical Trends,” http://www.gallup.com/poll/1597/confidence-institutions.aspx.
8. Kenneth Dam, The University of Chicago Law Review 50, no. 2, Fiftieth Anniversary Issue (Spring 1983): 504–532.
9. Herman Cain, “We Need a Dollar as Good as Gold,” Wall Street Journal, May 13, 2012.
10. The argument that gold-backed money hindered the US response to the Depression is most prominently associated with Barry Eichengreen, Golden Fetters: The Gold Standard and the Great Depression, 1919–1939 (New York: Oxford University Press, 1996).
11. 89th Congress, 1st session, H.R. 702, Committee on Government Operations, July 30, 1965.
12. James Rickards, The New Case for Gold (New York: Portfolio, 2016), 131.
13. Ibid., 52ff.
14. Bureau of International Settlements, 2013 survey.
15. Michael D. Bordo, “The Classical Gold Standard: Some Lessons for Today,” Review (Federal Reserve Bank of St. Louis), May 1981, 16.
16. Susan Strange, States and Markets (New York: St. Martin’s Press, 1994), 97.
17. Bordo, “The Classical Gold Standard,” 2.
18. Chicago Booth School, IGM Forum, January 12, 2012, http://www.igmchicago.org/igm-economic-experts-panel/poll-results?SurveyID=SV_cw1nNUYOXSAKwrq.
19. James U. Blanchard III, “Exclusive Interview with F. A. Hayek,” CATO Policy Report, May/June 1984.
20. David Shribman and Dennis Farney, “Survival Strategy Plotted: GOP Moderates Are on the Outside,” Wall Street Journal, August 22, 1984.
21. United States Mint Annual Report 2015, 6.
22. Peter Tulupman, corporate communications, World Gold Council, email to author, March 5, 2016.
23. Neil Meader, Metals Focus, email to author, March 10, 2016.
24. New York Times/CBS News Poll: National Survey of Tea Party Supporters. The poll was taken April 5–12, 2010, with 1,580 total respondents, of whom 881 were identified as Tea Party supporters. The poll had a margin of error of ±3 percent but higher for subgroups, making the 5 percent figure for gold buyers statistically questionable.
25. See, for example, Thorsten Polleit, “How the Blockchain and Gold Can Work Together,” Mises Daily, February 1, 2016, https://mises.org/library/how-blockchain-and-gold-can-work-together.
26. Kyle Chayka, “How Digital Currencies Led to the Biggest Money Laundering Case Ever,” Pacific Standard, February 5, 2014, http://www.psmag.com/business-economics/digital-currencies-led-biggest-money-laundering-case-ever-bitcoin-74083.
27. “SEC Wins Case Against Ponzi Schemer in Utah.” U.S. Securities and Exchange Commission, Litigation Release No. 23419, December 4, 2015, Securities and Exchange Commission v. National Note of Utah and Wayne L. Palmer, https://www.sec.gov/litigation/litreleases/2015/lr23419.htm.
28. “In Bullion Depository, Supporters See Golden Opportunity,” Texas Tribune, July 3, 2015.
29. Encyclopedia of American Business History, “Mining Industry,” 278.
INDEX
Page numbers listed correspond to the print edition of this book. You can use your device’s search function to locate particular terms in the text.
Note: Page numbers in italics refer to illustrations. Page numbers after 340 refer to notes.
Acheson, Dean, 101
Adams, James Truslow, 116
Agricola, Georgius, De Re Metallica, 82
Agricultural Amendment Act, Thomas Amendment to, 99, 101, 116–17
Alaska:
gold production in, 136–37, 167, 168, 185
gold rush in, xii, 5, 71, 154
alchemy, 9, 190–91
Alderdice, James and William, 305–6
Alexander, Henry C., 149
Algeria, gold order from, 200
Allen, William V., 72
American dream, coining of phrase, 116
American Institute for Economic Research, 108
American Legislative Exchange Council (ALEC), 334
Anderson, Robert B., 146, 147, 152, 154, 161
antimonopoly movement, 75
anti-Semitism, 61, 65, 108–9, 240, 347
Argentina, 78, 80
Arlington House, 218, 219, 221, 223–24, 250–51
Articles of Confederation, 15
Ash, Roy, 267
AT&T Bell Labs, 176–77
Atomic Energy Commission (AEC), 188, 189
Austrian school of economics, 216, 220, 231
Ball, George W., 171
Bank of England, 72, 77, 95, 145–46, 150, 151, 195–96, 199
Bank of International Settlements, 211–13
Bank of Nova Scotia, 157
banks:
banking wars of 1830s, 342
closures of, 57, 78, 87, 88–90, 99, 118, 217
commercial, 79
economic orthodoxy of, 108
and expansion of credit, 27
“Free Banking Era,” 14
and gold confiscation, 94
gold reserves of, 30, 40, 45, 58
Jackson’s “pet” banks, 17
and legislation, 14, 32
loans to government from, 30
national, 14, 16–17, 79–80, 106, 290, 336
notes issued by, 13–14
public confidence in, 60, 90, 342
regulation of, 217
state systems, 13, 17, 25, 30, 322
and stock market, 27
and US Constitution, 16
Barr, Joseph, 167, 168–70, 174, 180, 181, 193
Bartlett, Edward “Bob,” 168
Bator, Francis, 180, 192–93
Baum, L. Frank, The Wonderful Wizard of Oz, 62, 73–75
Bauman, Robert, 266
Beck, Glenn, 311–13, 319
Belmont, August, 59
Bernanke, Ben, 311, 317
Bernstein, Elmer, 237–38
Beter, Peter David, Conspiracy Against the Dollar, 272
Bitcoin, 332–33
Black Friday (1869), xii, 37, 47–48, 76, 307, 345
Bland, Richard “Silver Dick,” 64–66
Bland-Allison Act (1878), 64
blockchain, 332–33
Bordo, Michael, 326
Botha, P. W., 301
Boutwell, George S., 43–44, 46
Brandeis, Louis D., 120
Brands, H. W., 22
Bretton Woods conference (1944), xiii, 130–31, 325
and IMF, 131, 133
and World Bank, 131, 133, 263
Bretton Woods system, 260–62
drawbacks of, 130, 175, 179, 295
ending, 212, 216, 231, 261, 326
gold-exchange standard of, 131, 260, 295, 319, 322, 326
and gold supply, 206, 322
long-term instability of, 139, 231, 326, 328
and Nixon administration, 237, 256–57, 260-61
and price of gold, 131, 133, 257
Brewer, Jan, 335
Britain:
Anglo-American relations, 128–29
Brexit, 329
devaluation of pound sterling, xiii, 193, 195–200, 202, 207
emergency bank holiday in, 211
emergency gold from, 78, 272
gold cover requested by, 244
gold reserves of, 82, 128
gold standard in, xi, xii, 56, 84, 95
paper currency in, 34
and World War II, 129
Brooks, Mary, 273
Browne, Harry, 219–24, 272, 274, 311, 315
How You Can Profit from the Coming Devaluation, 194, 221–22, 223, 250
You Can Profit From a Monetary Crisis, 252–53, 259
Bryan, William Jennings, 61, 63–72, 74, 80, 100, 109, 114, 133, 329, 330, 336
“Cross of Gold” speech by, xii, 67–69, 71
Buchanan, James, 28, 29
Buckley, William F., 216, 218
Buffett, Howard, 133–39, 256, 308
Bullion Reserve of North America, 306
Burns, Arthur F., 230, 235, 237–40, 243, 245, 260, 265, 267–68, 270–71, 276, 287
Butler, Pierce, 119
/>
Butterfield, Daniel, 42, 44, 46
Byrd, Harry, 265
Cain, Herman, 321
Califano, Joseph A., 202
California:
gold rush in, xi, 1–3, 5, 6, 9, 10, 18–25, 303
San Francisco earthquake, 77
statehood of, 1, 21
Callaghan, James, 198
Campbell, F. B., 97
Canada:
gold ownership in, 80, 176
as gold producer, 157–58, 168, 270
Carabini, Louis, 224, 250, 252
Carmelite sisters, gold of, 159–60
Carnegie, Andrew, 78
Carter, Jimmy, 285, 291
Castro, Fidel, 171
Central America, USS, 25–27
central banks:
and Bretton Woods, 130
dollar reserves of, 179
Gold Pool (1961) of, xiii, 151, 195, 199–200, 205, 207–8, 212–13
gold purchased by, 150, 275
gold reserves of, 303, 317
and gold supply and demand, 315, 325
1968 emergency meeting of, 211–14, 216
paper currency issued by, 31
and price of gold, 259, 300, 324
suspicion toward, 80, 218
in twenty-first century, 322
US, 14, 16–17; see also Federal Reserve
Chase, Salmon P., 29–30, 31–32, 49–51, 344
China, xiv, 21–22, 325, 335
Christian ideology, 17–18, 22–23, 28, 33, 40
Church, Frank, 169
Churchill, Winston, 129
Civil War, US, 1, 6, 13, 14, 28–30, 31, 34, 35, 39, 40–41, 42, 49, 50, 113
Cleveland, E. L., 135, 136
Cleveland, Grover, 47, 57–60, 63, 64–66, 69, 70, 73, 114, 230
Clinton, Bill, 285
Coats, Dan, 309
Coinage Acts:
of 1792, xi
of 1834, 51
of 1873, 52–55, 61, 65, 346
“coin bonds,” 60
Coin’s Financial School, 65, 71
Cold War, 134, 141, 172–75, 218, 285
Colorado, 21, 303
Colson, Charles W. “Chuck,” 240
Columbus, Christopher, 4
Commodity and Futures Trading Commission (CFTC), 307
Computer Applications Incorporated, 219