Steve Forbes Predicts Gold Standard Restored In Five Years

There's only one Republican candidate promising a return to the gold standard, namely Ron Paul, and no Democrat contender is promising any such thing. Nevertheless, former candidate Steve Forbes is predicting a return to the gold standard within five years.

"What seems astonishing today could become conventional wisdom in a short period of time," Forbes said in an interview with Human Events magazine, a conservative publication.

Returning to the gold standard would mean stabilizing the U.S. dollar, restoring foreign confidence among foreign investors in U.S. government bonds and dissuade lawmakers from engaging in reckless spending habits, Forbes told the magazine.

If the standard had remained in place, Forbes said, the dollar would not be under assault now and federal spending would have been curbed.

"When it comes to exchange rates and monetary policy, people often don’t grasp” what is at stake for the economy, he said. "If the dollar was as good as gold, other countries would want to buy it."

Nevertheless, there are a lot of powerful vested interests that would block a return to the gold standard. The only way public opinion could shift in such a short time would be if the U.S. undergoes the throes of a debt crisis, which would act as a more powerful wake-up call signalling the long-term damage done by fiat money. It should be remembered that Ron Paul's audit-the-Fed bill had well over three hundred co-sponsors, yet it was quashed for a tepid substitute.