19th century depiction of Pliny the Elder courtesy of the Library of Congress
Originally posted on April 17, 2014
Hostility toward gold has a long pedigree.
Gaius Plinius Secundus, commonly known as Pliny the Elder, in his The Natural History, Book 33, section 3, writes:
Would that gold could have been banished for ever from the earth, accursed by universal report, as some of the most celebrated writers have expressed themselves, reviled by the reproaches of the best of men, and looked upon as discovered only for the ruin of mankind. How much more happy the age when things themselves were bartered for one another; as was the case in the times of the Trojan war, if we are to believe what Homer says. For, in this way, in my opinion, was commerce then carried on for the supply of the necessaries of life. Some, he tells us, would make their purchases by bartering ox-hides, and others by bartering iron or the spoil which they had taken from the enemy: and yet he himself, already an admirer of gold, was so far aware of the relative value of things, that Glaucus, he informs us, exchanged his arms of gold, valued at one hundred oxen, for those of Diomedes, which were worth but nine. Proceeding upon the same system of barter, many of the fines imposed by ancient laws, at Rome even, were levied in cattle, [and not in money].
There remains substantial confusion in the public mind between gold and the gold standard. The purpose of the gold standard is not to exalt gold. Its purpose, rather, is to provide integrity to the currency issued in accord to the definitional properties offered by the classical, true, gold standard.
It is obvious even to Neo-Keynesian economists that the comfort and, indeed, affluence, of working people and the middle class would not be improved by a return to barter whether ox-hides, iron, or spoils of war. And yet an almost superstitious hostility to gold — of the sort exemplified by Pliny — persists, blinding too many academics, policy makers, and officials to an exceptionally positive empirical record of the gold standard, relative to other systems, in fomenting a climate conducive to equitable prosperity.