Friday, December 16, 2011
Why Ron Paul Should Change His Mind About Austrian Theory
Krugman extolls the virtues of the current GOP rising star on the primary trail. He is alone among the contenders who has not changed his mind about everything that he has ever said in order to appeal to the current GOP base. Unfortunately, he should have changed his mind. He has been claiming for years, following the Austrian economic theories of Hayec, that currency must be backed by gold in order to prevent inflation. He has argued for years that the actions taken by the Fed to restore the banking system, which expanded the monetary base (currency and bank reserves) would produce hyper-inflation. Well inflation has been relatively tame but he has not changed his mind. Theory trumps reality again within the GOP.