Every now and then, we like to remind readers of historical lessons that we can learn from. Here's one about one of the most outrageous, dangerous power grabs in history:
On April 5, 1933, newly-elected President Franklin Roosevelt issued an Executive Order compelling Americans who owned gold (including paper gold certificates) to turn them in to the government within 30 days or face up to ten years in prison or a fine of $10,000, or both. Thus, with a stroke of the pen, the dollar-gold standard was eliminated.
He did this because gold hoarding was thought by FDR’s brain trust to be blocking a quick recovery from the Great Depression.
In order to "maintain the value of the dollar," the government illegally confiscated the gold in private hands, paying $20.67 an ounce for it. Then, in a classic bait and switch, the government jacked up the price of gold to $32 an ounce.
UP co-founder, Dr. Arthur Laffer, notes this was not just a dollar devaluation, but one of the greatest stealth wealth taxes in American history. Americans lost $10 for every ounce of gold the government took/stole from them.
That, along with near-70% tax rates, make-work government New Deal programs, a thicket of new regulations, doubled the size of government in four years, and - as Amity Shlaes and others have shown - made things much worse. Remember that the next time a big-government politician makes a promise.
