Nothing has more clearly demonstrated the need for the gold standard than its abandonment. Since that occurred, in Britain in 1931 and in the United States in 1933, the world has been plunged, both in wartime and in peacetime, into a sea of paper money and unending inflation.

Granted that it is desirable, and even imperative, to return to a full gold standard, by what methods should we return? And at precisely what dollar-gold ratio—i.e., at what “price for gold”? These difficult problems have split into dissident groups even the minority of economists who are actively urging a return to a gold standard.

The gold-standard supporters are divided into three main groups: (1) those who think we could safely return to a full gold standard at $35 an ounce; (2) those who urge return to a full gold standard at some specific higher price for gold (e.g., $70 an ounce) which they claim they already know to be the “correct” one; and (3) those who recommend that we permit a temporary free market in gold for guidance in fixing a final dollar-gold conversion rate.

If we grant that there is a great potential danger in trying to return immediately to a full gold standard at $35 an ounce, by what steps are we to return? And how are we to determine the dollar-gold ratio—which would decide the new “price of gold”—at which the return should be made?

In every year of the past quarter-century of inflation articulate individuals or groups have insisted that we were in fact in a depression or a deflation, or on the verge of one, or at the very least that our “economic growth” was not as fast as the adoption of their particular inflationist schemes could make it.

In January 1956, the President’s annual Economic Report suggested the restoration of the government’s power to regulate the terms of consumer installment credit. The then Secretary of the Treasury, George M. Humphrey, showed political courage as well as excellent sense when he refused to endorse the suggestion.