Money is like pornography in that no one seems to know exactly what it is, but everyone knows when they have it or don’t have it.
When money was silver, it seemed secure. But, nations tended to commemorate their declines by the adulterations of their silver. They’d also reduce the size of their coins, so people got less in at least two ways. But, when citizens started getting less money for their work, they always knew it. They automatically stopped doing as much work to get it.
At the end of each day in such regimes, there was parity: everyone had less. The worker had less money, the employer had less value added. It continues through realm after realm. No one ever seems to be able to do anything about utilizing the current resources more honorably.
Sometimes, a nation in decline would discover a new supply of silver. Then, prosperity would return in lockstep with increased purity and quantity of silver in the country’s coinage. The superior labor purchased by more and better silver resulted in more value being added. So, we may take the position that money is a means of exchanging one kind of work for another. The formula is astonishingly simple: More silver = more value added. More value added = greater prosperity.
This is pretty simple stuff, leading to the conclusion that, if a nation would spend a tiny percentage of its GNP on finding, refining, and getting more silver into circulation, things would get better for everyone.
Athens and Spain were brought back from the brink by discovering big, new sources of silver. Both nations used the newfound treasures to wage wars. Their purer silver commanded a premium in the marketplace. That enabled them to obtain better war materials and mercenaries more quickly. If the silver did not bring them everlasting victory, it certainly delayed defeat.
Such cash flows can last a long time. As late as the American Revolution, Spanish silver, ships of which had been stopping over in Cuba on their way to Spain for the preceding two and a half centuries, were thought by Robert Morris to be a source of loans for the cash-strapped patriots if Spanish authorities would permit.
There are, throughout America, huge, untapped resources of silver. Most of it is on Federal Lands. There are billions, even trillions of dollars, in precious metals entwined among the mountains and their roots. According to the quaintest and most innocent of theories, those assets belong to the American people.
A quaint and innocent American might ask “Why aren’t these deposits mined, refined, and all the silver left over after expenses distributed to each of us in the form of bright, shiny silver dollars?”
Our government would, with blinding speed considering how slowly it tends to move, make an answer that would prevail without being correct: “The American people would not be able to utilize such riches wisely. It is our responsibility to invest it for them and we would have no choice but to do so.”
For all any of us know, such a process may be going on, right now. For all any of us know, the mysterious and ever-present “they” might have been mining, refining, and investing silver in some sort of lockbox on our behalf for for decades. If it turned out that it were true, and the silver was in a building forty times the size of Fort Knox (reflecting the current gold/silver ratio), would all our economic problems be solved?
A related question: What if government officials suddenly announced that it was time for Americans to be told that The Department of the Treasury had, unbeknownst to them, been mining silver in isolated mountain areas for several decades? We’d be told that the ore was refined into silver, poured into bars, and filled a huge building. They would provide such convincing proofs (tours through the storage areas by Ron Paul, a few archbishops, and similarly respected souls?) that it came to be believed with almost near universality that the United States economy was sitting on a virtual mountain of silver. Well, a large hill of it. If the “they” followed that PR blitz by printing silver certificates, instead of the present puffery, would all our economic problems be solved?
Money is like pornography. No one knows exactly what it is, but everyone knows if they have it or not. Maybe.
