The True Gold Standard (Second Edition)
It is an extraordinary privilege to present this exclusive interview with Lewis E. Lehrman, in 21 installments, of which this is the thirteenth.
Lewis E. Lehrman has written widely about economic and monetary policy. He has co-authored the book Money and the Coming World Order (1976) with renowned MIT Economist Charles Kindleberger and others. Lehrman has written about economics in publications such as Harper's, The Washington Post, The New York Times, The Wall Street Journal, Weekly Standard, Crisis, Policy Review and National Review. His writings about monetary economics earned him an appointment by President Ronald Reagan to the Presidential Gold Commission in 1981. Along with Congressman Ron Paul, Lewis Lehrman collaborated on a minority report of the commission, which was published as The Case for Gold (1982).
Lehrman published seven volumes on “Rueff Monetary Economics” (The Collected Works of Jacques Rueff, 1997, Plon, in French). Jacques Rueff, the distinguished French monetary economist, established the monetary and economic plan of the Fifth French Republic, as President DeGaulle's chief financial advisor. The primary purpose of the plan was to restore economic prosperity, a stable French currency, and the end of French inflation by means of convertibility to gold of the French franc. Lehrman has been named to the advisory board of the American Principles Project’s Gold Standard 2012 initiative.
Lewis E. Lehrman [Photo by Ralph Benko]
Q13. The record shows that you were the chief intellectual architect of Jack Kemp's Gold Standard Act of 1984, a piece of legislation that was co-sponsored by, among others, Reps. Newt Gingrich and Vin Weber, both of whom went on to leadership positions in the Congress. There reportedly was a protracted dispute among Kemp's advisors between advocates of the Fed targeting of the price of gold and the classical gold standard, and Rep. Kemp came down on the side of the latter.
Would you share with the readers here some recollections as to those debates and why Kemp in the end supported the classical gold standard?
A: The debate over the form of the gold standard among Kemp’s advisors was carried on for years during the 1970s and 1980s. John Mueller and I advocated explicit convertibility of the major currencies to gold, inaugurated by an agreement among the major countries of the day. At that time, the United States had the prestige and the power to lead a conference among the G-5 toward the goal of convertibility. Others in the Kemp camp, led by Robert Mundell and Art Laffer, advocated variations of the gold-exchange standard, all of which John Mueller and I believed unworkable over the longer run, as the history of gold-exchange standards proved.