THE POSTMODERN DOLLAR: "IT'S ALL RELATIVE"
If nothing is backing the dollar, then why is that gold in Fort
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
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.