The US should go back to a gold standard

Hello, I am going to talk about why the gold standard. Anyway, Republicans have always supported the gold standard and we were very prosperous under it. Look at the Gilded Age with strong Republican presidents like Chester Arthur, Benjamin Harrison, and William McKinely. So I am going to be arguing why the gold standard is going to help people.Refutation #1What my opponent does not understand is that the U.S. government holds more than enough gold to sustain a dollar gold standard. Currently, the government owns 260 million ounces of gold. At a market price of $1,700 per ounce, that is worth $442 billion. Or more than 40% of the currency in circulation ($1,058 billion) and more than 15% of the $2.6 trillion monetary base. Under the classical gold standard, gold reserves typically were less than 10% of the currency in circulation [1].The U.S. government would not be required to hold enough gold to back, on a 1:1 basis, currency in circulation. As an example, the Bank of England, which was the center of the world gold standard for more than a hundred years, held only about 1:20 amount of gold relative to currency in circulation. Adam Smith called for a 1:5 ratio [1].The U.S. trade deficit would not necessarily grow under the gold standard. In general, a trade deficit reflects something far more basic than a nation's competitiveness. The trade deficit is the difference between domestic savings and investment. The gold standard with reduce the "bad" trade deficit, which contributes to job losses. Under the current system of floating currencies, the world is on a de facto paper dollar standard. This creates artificial demand for the U.S. Treasury securities by foreign central banks and corporations. But to increase their holdings of dollar deposits, foreign entities have to sell more goods and services in the United States than they buy in the United States, which increases the deficit on the trade account. Under an international gold standard, gold and other gold-backed currencies would be ready substitutes for the dollar. As a consequence, foreigners would less inclined to trade goods in exchange for imports of American-amde goods or services. This would be put in place of powerful economic forces that would lead to a reduction in the "bad" trade and an increase in the U.S. savings rate. When these powerful economic forces are coupled with elimination of the tax bias that ships jobs overseas, the United States will dominate the world trade [1].Refuting the Village AnalogyAs I have said, the Bank of England held only about 1:20 amount of gold relative to currency in circulation. The U.S. government holds more than enough to sustain a dollar gold standard. There goes the first scenario [1].Those two villages that want to buy from the other village in the second scenario can. Say both villages have a federal reserve. Their federal reserves could sell securities from their portfolios, thereby further reducing the monetary base. At some point, this process would create a scarcity of dollars relative to gold (at a fixed rate of exchange between the dollar and gold) such that an individual or country would present gold for either currency or dollar deposits in a bank in the United States. Again, those villages would not be required tpo hold enough gold to back, on a 1:1 basis, currency in circulation (remember the Bank of England) [1].Refuting Gold and the Great DepressionWhile some believe that the gold standard started the Great Depression, it actually did not. What we know as the Great Depression actually started as a recession, similar to the recession of 1919. In both cases, we were on a gold standard, and the Federal Reserve mismanaged it. But what turned the recession of the early 1930s into the Great Depression was a series of additional policy errors that intensified the severity and duration of the the downturn [1].The time that the Gold standard was taken off was 1933, and that year was also the worst year during the Great Depression. In 1934, the United States resumed the gold standard (if at a higher price), and the recovery got going. It was a mediocre recovery, in that going off the gold standard and the dollar devaluation against gold had introduced a lack of clairty in the system. Adding more trouble was the American president, Franklin D. Roosevelt, who created a large government system to fix the economy, that made the recovery more complex and longer [1].A gold standard does not lead to more recessions. The classical gold standard leads to fewer, shorter, and shallower recessions. In the 19th century, the noteworthy "panics," such as thbose of 1873 and 1893, were cuased by the United States wavering in its cmmitment to keep the dollar as good as gold. In both cases, however, the United States came around renewing to its commitment to the gold standard, and the recoveries that came were stupendoues and immediate. The run of growth from 1873 to 1892 was the greatest in American history (4.7% per year). From 1894 to 1913, growth was 3.6%, above the post-1913 average of 3.2% [1]. 1. Herman Cain, "9-9-9 An Army of Davids"