Tuesday, July 31, 2012

Ron Paul's End the Fed 2: The Janitor and William Jennings Bryan

In my latest reading of End the Fed, Ron Paul talks about the people who intellectually influenced him, and Paul mentions his upbringing and certain economists whom he met, read, and heard.

Another person who influenced Ron Paul was a janitor who worked at his high school when Paul was young.  This janitor complained about the bankers, and Ron Paul says that he (Ron Paul) didn't know enough at the time to probe the janitor about this.  But years later, in thinking back, Ron Paul speculates that the janitor was probably a "product of the Populist-Progressive Era of the late 1800s and the early 1900s", and that the janitor was perhaps "influenced by William Jennings Bryan's populism and attacks on bankers" (page 41).

Ron Paul then talks about William Jennings Bryan.  Paul notes that Bryan was not a champion of "our cause" (page 41).  Paul states that Bryan was not a libertarian, and (although Paul does not say so explicitly, at least not in my latest reading) Paul probably also has a problem with Bryan's opposition to the gold standard and support for free silver.  Yet, Paul expresses admiration for Bryan because Bryan opposed central banking and praised Andrew Jackson's attack on the Bank of the United States.

I liked Ron Paul's anecdote and reflections on Bryan for a variety of reasons.  First, it's eye-opening and sobering to realize that there was a time when the people who are currently up there in years were young, and at that time they themselves knew people who were up there in years.  Time marches on!  I consider those who lived during the time of Franklin Roosevelt to be up there in years, but there was a time when they themselves were young, and the older generation of their day had experienced things earlier than Roosevelt, such as World War I and the progressive movement.  And, like Paul, we can find ourselves in a situation where we move on in years and gain understanding, and we wish that we could have asked the older generation of our youth some questions that in our youth did not occur to us.

Second, I appreciate the fact that Paul acknowledges value in what William Jennings Bryan said and did, even though Paul is clear that he does not agree with Bryan on a lot of things.  I wish people in politics saw value in the other side more often.

Third, it's ironic that, today, many (such as Ron Paul) who criticize the Federal Reserve and central banks tend to support the gold standard, when that was not always the case.  As I write about here, Father Charles Coughlin in the 1930's was a critic of international bankers, yet he also opposed the gold standard.  See also Emanuel Josephson's discussion of a scarcity vs. a surplus economy.  I have much to learn about why the Free Silver movement existed at the turn of the century.  From what I read online and in a book on economics, it had to do with enabling farmers and ranchers to pay their debts.  Free silver would weaken the dollar and expand the money supply and thus make the debts more manageable.  Imagine paying off a debt from (say 1900) with today's dollars.  The debt wouldn't be much because of inflation----what was a lot of money back then is not a lot of money now.  Free silver was championed by proponents as a defense of the little guy against the rich and powerful.  You can read and listen to Bryan's speech here.

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