The US should go back to a gold standard

Gold Standard and deflation My opponent’s arguments actually do not even scathe my argument and actually shows he does not understand currency. His main theme in his rebuttal in the US has enough gold in stock to sustain a gold standard. We have enough paper money to sustain our economy, for example. If we stopped producing the money, however, we would see massive deflation and a huge economic downturn. On a gold standard, its production will be extremely slow as the mining process is inefficient for a growing economy. So, it’s the production of the currency not the amount of currency that will cause the deflation/inflation. My opponent’s second argument is the bank of England. England was only able to keep the gold standard in circulation due to the fact they dumped huge amounts of money in recoinage programs to make production a decent rate to sustain growing economies. So my opponent’s argument is exactly what I am saying, production not brute amount is the factor in deflation [1]. My opponent is attempting to argue that it will raise some deficits, and lower others, and therefore cause something known as “balanced trade”. And later it will cause us to be the trade leader of the world. But how could this happen when deflation occurs? For example, the current gold production means our GDP would only be 80 billion dollars, which is extremely low. And that’s if the US used every ounce of gold in the world produced yearly on its currency. So realistically it would be much lower. And with an economy of many third world countries I doubt we would become a “trade leader”. Also a countries ability to expand monetary amount is essential in preventing trade deficits. The only way to prevent trade deficits would be to have gold outflow [2]. Village Analogy My opponent fails to show money production would not be inefficient and cause deflation. So the actual analogy might be refuted, though the idea of how it causes inflation still stands. My opponent’s second scenario of federal reserves is bogus, as deflation has not occurred since the gold standard has been done away with. And my opponent brings up his ratios again, which are irrelevant to the argument. Great Depression My opponent’s first objection is saying other factors likely caused the depression. I agree, other factors played a large role in the depression. But my opponents case fails to refute my point as I proved that gold standards are the reason depressions occur due to the fact they create unnecessary boom and bust cycles. Although the recession was caused by other factors, the gold standard always makes recessions worse as since the abolition of the gold standard depressions never occurred again [3]. It is also a fact that the gold standard made the depression much worse. Here is an informative graph: Source: http://en.wikipedia.org... The triangles mark the period when the countries left the gold standard. And what to we see? The trend of growth increased (hinting gold standard sped up recoveries) or the downward trend became an upward trend (meaning abolishing gold standard began a recovery). As we can see switching monetary policy helped end the gold standard. My opponent’s second argument is the recovery was mediocre. But this admits switching currencies helped begin a recovery and the gold standard had little effect (or even worsened) the recovery. And based on the graph presented above, wealth per capita went from under $6,000 too nearly 8,000. As we can see the recovery was actually significant, an increase in income by a factor of three. My opponent’s last argument was the gold standard leads to overall stability, but this is false, the gold standard elimination ended depressions. In other words the gold standard makes sort term volatility and is extremely unstable [3]. Research shows the gold standard is extremely unstable from a depression standpoint; it worsens most downturns and causes short-term volatility, creating booms and busts. It also worsens the economy in the short term. In the long term it will overall shrink an economy, and be like a cap on economic growth [4]. My opponent’s case Where is it? My opponent with the Burden of Proof has not laid out a statement and therefore should automatically lose the debate unless he presents one this round. If he does not create a case, he fails to meet his burden. Conclusion: My opponents pro, is against the status quo, yet fails to uphold his burden of proof by not presenting a case. Unless he does so, he should automatically lose the debate. I would also like to note my case still stands and many of my opponents arguments have shown not shown deflation would not occur as production of gold would be limited. It would be like a cap on our economy, and the cap is under 80 billion dollars. Further I have shown leaving the gold standard benefits countries in times of depression and since then depression have been non-existent. And that a gold standard lengthened the depression (a point my opponent drops). Based on these facts I urge a CON vote. Sources: [1] http://en.wikipedia.org... [2] http://www2.econ.iastate.edu... [3] http://www.huppi.com... [4] Ben Bernanke and Harold James “The Gold Standard, Deflation, and Financial Crisis in the Great Depression: An International Comparison” University of Chicago Press, (1991).