Monday, November 8, 2010

NY Sun Editorial: Palin v. Bernanke

She is now out in front of yet another issue
The Sun's editors say that Gov. Palin's warning to the Fed chairman puts her out front on the debate over the dollar:
One of the questions in respect of 2012 is how it has happened that the only major Republican figure, aside from Congressman Ron Paul, to stand up and be counted on the dollar is Sarah Palin. She is supposed to be an ex-beauty queen without a lot of sophistication. Yet she is reportedly scheduled to be in Phoenix today delivering a major address challenging the plan of the chairman of the Federal Reserve, Ben Bernanke, to inflate the dollar. Snippets of her text were put up Sunday on the National Review Online and began immediately rocketing around the globe, no doubt in part because of the Palinesque phrasing, in which she called on Mr. Bernanke to “cease and desist.”

Now we don’t mind saying that the Sun has been looking forward to the Alaskan breaking out on this issue. In October 2009, we issued an editorial called “Palin and Paul.” We noted that those waiting for a politician to pick up on the monetary issue were perking up to a posting on Mrs. Palin’s Facebook page. In it she had noted that the Gulf oil states were reported to be negotiating with Russia about abandoning the dollar as a unit of pricing, observed that an official of the United Nations had called for a new world reserve currency, and, most importantly, warned that the value of the dollar was collapsing in terms of gold. Her posting, we wrote, suggested that she was ahead of the rest of the undeclared contenders for 2012.

At the time, the value of a dollar had slid to just less than a 1,000th of an ounce of gold. Today it has plunged to barely better than a 1,400th of an ounce of gold. In other words, in the year since Mrs. Palin took up this issue, the Bernanke Dollar — or the Obama Dollar, or the Pelosi, as we’ve sometimes called it — has lost a third of its value. The chairman of the Federal Reserve is now on an announced plan to try to inflate it further. So far the Congress that has oversight of the Federal Reserve has been largely mute, though there have been some notable exceptions (Congressman Paul Ryan, for example, and Dr. Ron Paul, of course; among the big newspapers, only the editorial page of the Wall Street Journal has been in front of this issue).

We were struck, reading the Robert Costa’s National Review advance on Mrs. Palin’s speech, with the reach of her warning. She attacked QE2, as the second quantitative easing of monetary policy is called, head on.

The editors conclude, "she is now out in front of yet another issue as there is about to convene a new Congress of the United States in which she has a brace of allies indebted to her for her help in getting elected. Mr. Bernanke seems to have blithely ignored his other critics, but it will be more dangerous to ignore the Mamma Grizzly."

h/t: Benyamin Korn

- JP

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