News & Updates

Sunday, December 30, 2007  
Steve Horwitz responds to co-blogger Peter Boettke's post on the gold standard and the Great Depression:
1. The post-WW I Gold Standard was not the "gold standard" or "free banking" system that any current Austrian would defend. Trying to pin the problems of the 20s and 30s on the GS as talked about by Austrians or libertarians today is like dismissing free market health care reforms by blaming our current health care problems on our "free market" in health care. The really-existing GS certainly contributed to the crash and deflation.

2. Aside from that, it's totally clear that the Fed mismanaged the situation it found itself in by 1929. Almost everyone agrees this was government failure writ large. The disagreement is the comparative institutional question of whether that failure is "reformable" or requires a regime change. In either case though, the Austrian skepticism about central banks is in play.
Read the while thing here.
3:28 PM