Burnt Orange Report

Goldilockboxes and the three bars

By Jim Dallas

Matt Yglesias:

Noam Scheiber observes that -- shockingly -- Charles Krauthammer's take on Social Security is shot-through with logical problems. On top of the problems in question, let's also note Krauthammer's commitment to the rightwing doctine of Currency Fictionalism:

Let's start with basics. The Social Security system has no trust fund. No lockbox. When you pay your payroll tax every year, the money is not converted into gold bars and shipped to some desert island, ready for retrieval when you turn 65.

By this standard, not only is my bond porfolio not real, my bank account isn't real, and, in fact, the cash in my pocket isn't real. The only "real" money, apparently, is stacks of gold bars. Now once upon a time, your U.S. currency was redeemable for gold bars and, thus, one might consider it real. Alternatively, perhaps U.S. currency in the gold standard days was a "mere I.O.U." Either way, we've been off the gold standard for some time now, and people would be alarmed to learn that this means their money is fake. Does the Post pay Krauthammer in dubloons? Do we need to revisit Krugman's "Goldbug Variations" from his good old days at Slate?

We know that Matt is a Harvard Man and a member of the coastal illuminati... etc., etc., but yes, Matt, you will. It was only four years ago, after all, that the Texas Republican Party endorsed abolishing the Federal Reserve and going back to the gold standard. You're going to have to explain this slowly and clearly, just so that reasonable people can understand just how insane that is. (The TxGOP has since moderated the language to "audits" of the Federal Reserve).

P.S. Gary Polland, who is a big whig and former county chair here in Houston, still adamantly supports returning the gold standard. Party like it's 1899!