Pence Gets the Gold Bug

In a speech today, Rep. Mike Pence became the latest in a string of establishment conservatives to flirt with the gold standard.

It seems that for every Republican politician from Indiana who shows policy expertise (Gov. Mitch Daniels), another one has to give us heart attacks. Today, Rep. Mike Pence of Indiana gave an economics policy speech to the Detroit Economics Club. While the media has been focusing on Pence’s support for a flat tax, this was not his most noteworthy comment. More importantly, Pence reiterated skepticism of the Federal Reserve. His remarks are the latest in a string of comments from supposedly establishment conservatives criticizing the Fed and flirting with the gold standard.

In the section of his speech that discussed monetary policy, Pence said he wants a "debate" over the "proper role" that gold should play in monetary policy:

My dear friend, the late Jack Kemp probably would have urged me to adopt a gold standard here and now.  Robert Zoellick, President of the World Bank, encouraged that we re-think the international currency system, including the role of gold and I agree. The time has come to have a debate over gold and the proper role it should play in our nation’s monetary affairs.

The fact that the Chairman of the House Republican Conference, wants to open a debate on the Gold Standard shows how skepticism of current monetary policy has reached the leadership of establishment Republicans.

Of course this is not surprising at all, it is the consequence of a conservative world that has become more favorable to these sorts of argument. In early October, The Weekly Standard published a piece criticizing our "debt driven monetary system." The piece identified the authors as members of the "American Principles Project, a Washington-based advocacy group." From the website of the group we learn that one of their goals is to "reach out to lawmakers to advance legislation that will put the gold standard on the front burner of national politics"

The Fed's announcement to purchase $600 billion in treasury bonds also generated a new round of Fed skepticism, with the publication of an "Open Letter to Ben Bernanke" giving conservative intellectual backing to expansionist monetary policy.

In another time, Pence's comments would invite comparisons to fringe paleo-conservatives such as Ron Paul. Now, they are becoming part of the Republican package of talking points.

Tweet

Follow Noah on Twitter: @noahkgreen