I am savoring, however a couple of apparent contradictions in discussions of the gold standard--one deep-seated, the other more transitory.
First, deep-seated. It's my experience that gold standard advocates are also, to a considerable extent, strong nationalists--fierce, some would say paranoid, protectors of national sovereignty. Yet one thing you can unambiguously say about a paper standard is that it is an assertion of sovereignty--that it is a refusal to let others control the nation's money. This being true, it seems that the embrace of a gold standard is the ultimate surrender of sovereignty--the surrender of control over money to somebody, somewhere (the gnomes of Zurich?) whose identity we cannot discern and whose behavior we therefore cannot possibly control.
More transitory--I follow with interest the campaign of Ron Paul and others to get an "audit" of the Federal Reserve. Opponents of the audit seem to fear, inter alia, that an audit would be a camel's nose under the tent--a preliminary foray directed at destroying the independence of integrity of the Fed. Cf., link. On the face of things, this would appear to be a plausible concern. Yet it is puzzling. Proponents of the audit for the most part seem to be those (like Paul) who argue that the Fed fails to control the integrity of the money supply. Yet isn't this exactly the reason why we should fear the nose under the tent--the fear that greater Congressional