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Showing posts from May, 2012

Ben Bernanke Goes Back to School

[Note: A version of this article is available as a video commentary.]

In the opening chapter of his book Essays on the Great Depression, Fed chairman Ben Bernanke tells readers, “I am a macroeconomist rather than a historian.”  Though the book was published in 2000, his recent statements about the classical gold standard and the origins of the federal reserve suggest the vast revisionist literature pertaining to U.S. economic history is still largely unknown to him.[1]  His comments, in fact, sound like they were pulled uncritically from a public high school teacher’s manual: Why did the government institute a central bank?  To rein in the gold standard, which was creating crises.

This approach proved not to be a problem, though, when he lectured George Washington University students on March 20, 2012 about the Fed and gold.   On that day he told the class that
in the period after the Civil War until World War I and really all the way into the ‘30s, the United States was on a gold sta…