Three days out of the gate, and Texas Governor Rick Perry has already had his first gaffe in the Republican presidential primary. Speaking before a crowd in Cedar Rapids, Iowa on Monday, Perry called loose monetary policy and act of treason, and made not-so-subtle threats about the physical safety of Federal Reserve Chairman Ben Bernanke, should he happen to find himself in Texas.
“If this guy prints more money between now and the election,” said Perry to the group, “I don’t know what y’all would do to him in Iowa, but we – we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in American history is almost treacherous – or treasonous in my opinion”
This is a little ironic given Perry’s own flirtation with near-treasonous ideas. But if you put those two things aside, you’ll notice that this isn’t a unique sentiment among Republican presidential hopefuls. Back when he was still a viable candidate for the GOP nomination, former Minnesota governor Tim Pawlenty touted his opposition to “fiat money” – i.e. monetary stimulus – and endorsed Representative Paul Ryan’s proposal to index the dollar to the neo-gold standard of a “commodities basket.” Representative Michele Bachmann wants to keep the dollar “strong,” even if it comes at the expense of American exports, and Mitt Romney has criticized President Obama for letting the dollar weaken, despite the fact that, for now at least, a weak dollar is beneficial to the economy.
Now that the Republican mainstream contains Fed skepticism and "tight" money, it’s no surprise that Perry would embrace it as part of his nascent effort to reach a national constituency. The big problem is that these ideas are insane, and could destabilize the world economy if actually brought to bear on American economic policy.
In other words, if there’s any actual lesson to draw from Perry’s anti-Fed rhetoric – and it’s echo across the Republican Party – it’s that the GOP is even less fit to govern than anyone previously realized.
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