The destruction of sound money over the past century has had a devastating impact on socio-economic relations in the West.
Previously, the gold standard limited the political class’s ability to grow the size of the state and allowed for the middle class to emerge in an economically sustainable fashion. With a gold standard in place, people’s savings were safe from the wealth-destroying scourge that is mass inflation.
Sadly, that changed with the creation of the Federal Reserve in 1913. Politicians at the time new that direct taxation could only go so far in terms of facilitating the growth of government. Eventually, taxes must be raised on the general population, which is generally a politically suicidal move.
Instead, it just makes more sense to debase the currency through inflation and pass the costs of big government to future generations. In the meantime, the present generation, especially middle-class members, watch their wealth get whittled away by inflation.
The US’s transition to fiat money has been nothing short of devastating. Certain estimates point to the dollar losing 98% of its purchasing power ever since it ditched the gold standard in 1971.
Things will only get worse due to the US ruling class’s commitment to fiat money. There is no desire to scrap this system altogether.
As a result, the US will likely be staring down the barrel of a series of economic crises ranging from defaults to inflationary collapses.
The former could be a harsh reality in the next decade or so.
Will the US government eventually default on its enormous debt?
Watch George Gammon’s video to get the scoop on how the US government's fiscal profligacy is going to create a massive fiscal crisis.
—Team Rebel Capitalist