Editor, Gazette-Journal:
Recently I encountered an advertisement involving the sale of old U.S. coinage and was a bit surprised at the price of these coins. For example, pre-1965 silver dimes in $5 face value (i.e., 50 dimes) were priced at over $130, while a $20 gold piece that sold for $42 in 1964 is now valued at over $2,500 today. This prompted the question, what has happened to our money? I should be more explicit and use the correct term, currency, as we are no longer on a gold standard. According to the Constitution, only gold and silver are considered to be money.
The increase in the dollar value of gold and silver as well as most everything else can be attributed to inflation. President Nixon’s “temporary” closing of the gold window and removing the gold backing of the dollar in 1971 created an increase in the rate and frequency of inflation. Inflation has soared since the uncoupling of the dollar from the gold standard. The excess currency creation—money printing among other methods, prompted by Congressional spending, budget deficits, etc.—has resulted in an inflationary trend that is far more than merely transitory. This trend is likely to increase absent spending restraints imposed by the gold standard. The excess spending over past administrations has created an exorbitant debt increase in excess of $36 trillion. The absence of spending constraints on the dollar, as well as the currencies of other nations, has resulted in an explosion of debt worldwide that will pose consequences far beyond the substantive increases in the value of gold and silver.
When government spends more than it receives in revenue, it runs a budget deficit and borrows money to cover the difference. This borrowing increases the national debt. Should the government continue to run deficits, those deficits and the borrowed money will contribute to continuing inflation. The federal government has not had a balanced budget since the Clinton administration in 1995 to 2001.
The incoming Trump administration will be confronted with the prospect of having to deal with a national debt service interest payment of a trillion dollars, according to the Congressional Budget Office. Meanwhile, the incoming Trump administration, as well as many Republican lawmakers, are already seeking ways to reduce government spending in order to minimize the debt and reduce interest payments. Trump’s budget director has proposed an alternative budget with substantial spending cuts.
If the ballooning debt is not soon addressed, we are doomed to continue as we are while likely imposing the cost of failed government on the unknowing, unsuspecting people of this nation.
President Trump brings with him a wealth of financial experience that the American people believe will make a difference. We should all pray that he is successful as the lives of our children depend on us.
Andrew Maggard
Port Haywood, Va.