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• Associate Editors
• Editorial
• Bibliographical Essay: Economics and Ideology: Aspects of the Post-ricardian Literature
• I: Political Economy
• The Classical Model of Political Economy
• Modernization, Ideology, and Economic Freedom
• Individualism Vs. Collectivism?
• The Industrial Revolution and Literacy
• Parliamentary Enclosure and Uprooted Labor
• Smith's Critique of Monopoly
• Ricardo and the “dual Development”
• Ricardo On Money
• Inflation and Political Crisis: Germany
• Inflation and Unemployment
• Government and Inflation: the Mccracken Report
• II: Concepts of Liberty
• Liberty and Its Components
• Is the Right to Freedom Vacuuous?
• Liberty, Slavery, and Utilitarianism
• Individualism, Freedom, and Society
• Liberty and Habeas Corpus
• Should Britain Have a Bill of Rights?
• Locke, Women, and Freedom
• Locke, Women, Freedom, and Individualism
• Locke, Property, and Individualism
• Children, Freedom, and Individualism
• Liberty and Mental Illness
• Sismondi and Liberty
• Mill: On Liberty
• Mill, Freedom, and Happiness
• Freedom of Speech and Moral Development
• Freedom In Kant, Hegel, and Marx
• Marx, Freedom, and Property
• Neoconservatives, Liberty, and Equality
• Freedom: the Politics of Justice and Existence
• Liberty and the American Revolution
• American Libertarians
• III: Economics and Public Policy
• How Economics Influences Political Theory
• Why Democracies Choose Deficits
• Inflation and the Welfare State
• Monetarism and the Depression
• Asian Monetary History: Gold & Silver
• Specie Money Vs. Antibullionists
• Inflation Effects On Capital
• Consumption of Public Health Services
• Factory Regulation and Vested Interests
• Poverty Programs and Government
• The Costs of Regulating Market Information
• Rent Regulation
• Engels On Economics
• IV: Social Analysis
• The Depoliticization of Society
• Is Philosophy Politically Subversive?
• Plato's Republic As a Political Dystopia
• Cicero and Modern Political Philosophy
• The Roman Jurist Gaius and Social Thought
• The Myth of Social Hierarchy
• Contract and Political Thought
• Private Vs. Public: the Domain of Freedom
• Montaigne and the Value of Tolerance
• Commerce, Utility, Character, and Republicanism
• Quintin Skinner and Western Political Thought
• Public Choice
• Editorial Board
• Contents of Vol. 33 No. 2
• Contents of Vol. 33 No. 3

Specie Money vs. Antibullionists

Will E. Mason

• Pennsylvania State University

“Winners and Losers: Some Paradoxes in Monetary History Resolved and Some Lessons Unlearned.” History of Political Economy (Winter 1977): 476–489.

Today's monetary issue is as old as economics itself, yet as modern as tomorrow: the question of the monetary standard, which, in modern terms, is the criterion of monetary policy. The “bullionists” are supposed to have won the nineteenth century monetary controversies, yet it is the “antibullionist” dogma that pervails today. We have the abstract (noncommodity) monetary unit desired by the antibullionists, but do not know how to manage it because we adopted it by default rather than by design.

Ricardo argued that nothing would prevent a costless currency from becoming worthless. No one has yet proved him wrong, and today we appear to be proving him right. The banking school became the stewards of the antibullionist doctrine, and relied on banking practice rather than politicians to maintain the value of the monetary unit. Forgotten were the fallacies at the root of banking school principles, such as the Real Bills doctrine. But these fallacies governed the operation of the banking system. The banking school dogma was tested and proved a failure in the thirties. Though the public believed the bullionists had won, public policy had, in effect, unknowingly enshrined the banking school doctrine. Hence, the disastrous consequences for the banking system—which was believed to be the product of the bullionist paradigm, but in fact operated according to the principles of antibullionism.

But the modern International Monetary Fund is simply a repetition of past errors. International reserves, intended to determine the international money supply, must instead function to protect an indeterminate supply. We are still left with the problem. Can a noncommodity money allow us to find a market-determined rule to guide monetary policy in the place of a real commodity money and the derived rules of the past? Monetarists think they have found such a rule, but neglect real factors (e.g., war) that are responsible for inflation-deflation cycles.

“It is no wonder that we do not know what to do. We know not what we have done or are doing.”