("Quid coniuratio est?")
THE POSTMODERN DOLLAR: "IT'S ALL RELATIVE"
If nothing is backing the dollar, then why is that gold in Fort Knox?
Or even, how do we know there is still gold in Fort Knox?
Look at the side edging of a dime or a quarter. That edging is more than just decorative. When the coin was made of silver, that edging guaranteed that unscrupulous persons had not shaved off silver from the coin; that that coin contained the exact measure of silver. But why is that edging still on the side of dimes and quarters? No one would waste time shaving off copper from those coins.
What exactly makes dimes and dollars worth anything? What gives them worth is that people believe they have worth. If $450 will buy you an ounce of gold, then $450 is worth an ounce of gold. If $125 will buy you a microwave oven, then $125 is worth one microwave oven.
Why do people believe the dollar has worth? Because (ahem) it is backed by the UNITED STATES GOVERNMENT. So as long as people believe in the United States government, they will believe in the dollar. But if they don't believe in the U.S. government, then why believe in the dollar?
What backs the dollar? Belief. How is the dollar propped up? Belief in the United States government.
So what happens if belief in the U.S. government is threatened, say, by evidence of widespread corruption? That means that belief in the dollar is threatened. (Of course, the corruption in government, in itself, threatens belief in the dollar.) Remember how Larry Nichols got the phone call from "Wall Street types?" "Please, Mr. Nichols, don't go public with that. It will hurt the dollar/yen ratio."
Instead of a dollar backed by gold or silver, we have a "commodity dollar." Paul Bakewell, in What Are We Using For Money?, says that "the use of a composite group of commodities at a specified index point" is now the standard of value. "By that composite index you would measure the value of other commodities; and the value of paper currency would also be measured by that composite index, and as thus measured the paper currency would vary in value, according to its purchasing power."
In other words, the dollar is worth whatever it will buy. If $1 will buy a Zippo lighter, then $1 is worth one Zippo lighter.
The "relative dollar" arrived in the 1930s, about when "postmodernism" ("the truth is relative") came along. But which came first, postmodernism or the "relative dollar?" Noam Chomsky has said that political power tends to coalesce around economic power. Did elite "thought" coalesce around the "relative dollar" and so give us postmodernism?
But Brian, what does this have to do with conspiracy? The strength of the dollar is backed by belief in the U.S. government. So, the government must be perceived as godlike or else the dollar's value diminishes. To prop up the dollar, news of government corruption, criminality and idiocy is played down. You say there have been conspiracies? Then you will be portrayed as a "conspiracy nut," otherwise truth would hurt confidence in the government and the dollar would slide, relative to commodities.
One dollar equals one Zippo lighter. We supposedly have a $4 trillion national debt. Why not manufacture 4 trillion Zippo lighters and dump them all into the hands of our creditors? We could make them in secret then, out of the blue, say, "Here's your 4 trillion. We're even now." Then, if the value of Zippo lighters drops, explain sagaciously that "it's all relative."
Circa 1930s began the consumer society, where Americans increasingly are in a rush to buy, buy, buy. In other words, they are anxious to trade paper dollars for goods. The trick is to exchange the dollars for goods likely to hold or increase their value relative to the dollar. Do you spend money like there's no tomorrow? Deep down you vaguely understand that the "relative dollar" you possess is not stable and you look for something to replace it, something more likely to hold its value.
Something big happened to this country in the 1930s, though it is rarely covered in standard so-called history. Your grandfather had to turn in $20 of gold to Uncle Sam and got back $20 of paper currency. Decades later, you were allowed to buy back that gold, but at a cost of about $450 in paper currency. So what happened between the $20 your grandfather turned in and the $450 you paid to get it back? $450 minus $20 equals $430. Where did that $430 go? It went somewhere. Who got it? Somebody did.
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