Cross of Paper

“You shall not crucify Mankind upon a cross of gold,” said inflationist William Jennings Bryan. But mankind, especially poorer and more vulnerable people, is oppressed by paper money, not by gold. It was for this reason that Thomas Jefferson and Andrew Jackson—the presidents who were our greatest defenders of the common man—were such unalterable opponents of paper money.

“[Gold] is the most perfect medium,” said Jefferson, “because it will preserve its own level; because, having intrinsic and universal value, it can never die in our hands.… [Paper money] is liable to be abused, has been, is, and forever will be abused, in every country in which it is permitted.”

Expansion of the money supply through “spurious paper currency,” noted Jackson, “is always attended by a loss to the laboring classes.”

“Of all the contrivances for cheating the laboring classes of mankind,” added Daniel Webster, “none has been found more effectual than that which deludes them with paper money.”

U.S. $5 gold piece of 1837.

“The rise of prices that follows an expansion of [paper money],” wrote William Gouge, President Jackson’s Treasury advisor, in 1833, “does not affect all descriptions of labor and commodities, at the same time, to an equal degree.…Wages appear to be among the last things that are raised.…The working man finds all the articles he uses in his family rising in price, while the money rate of his own wages remains the same.”

During the greenback paper money inflation of the Civil War, prices rose 183%, while wages went up only 54%. During the World War I inflation, prices rose 135%, and wages increased only 88%. The same is true today.

Says Dr. Murray Rothbard: “When greenback-dominated prices rose during the Civil War, gold prices (gold still circulating, especially in California) didn’t go up, so that it was obvious to everyone what the cause of inflation was: and it wasn’t speculators, businessmen, slackers, etc., all of whom were involved in gold as well as paper.”