Perhaps you’ve seen the stories this week about the $6.6 billion in one hundred dollar bills that the US Government managed to “lose” in Iraq back in 2003-2004. Apparently, as part of the Iraqi reconstruction effort, plane loads (C-130 Hercules to be exact) of palettes containing shrink wrapped 100 dollar bills were flown in. $22 billion in all. As the Pentagon is attempting to close the books on the operation this week, it was revealed that some $6.6 billion cannot be accounted for.
Let’s think about this for a minute. Under full military guard, physical cash is handed out, and all that has to be done is to collect a receipt. How difficult can this possibly be? That’s right, it’s not difficult at all. And the money that was lost was fully planned to be lost. This is what governments do, or more accurately, this is what human beings do when provided the opportunity. Give a group of folks the sole legal ability to print money (in this case literally) for their friends, and that is exactly what will happen. I don’t think anyone over the age of about four doesn’t understand this.
With this in mind, let’s examine one of those great pieces of American folklore: the US gold reserves. The fact of the matter is, a full independent audit of the US gold has never been performed. The closest thing to a real audit was last performed in 1953, but even that one had major problems. First, there were no independent outside parties involved, and second, only 5% of the gold was tested for purity.
For the nearly 60 years since then, the reserves have been held under tight control by a group of men closely connected to the Wall St. banks. Zero oversight by the American people or their elected representatives has been permitted. Just last week, as part of their coverage of Ron Paul’s inquiry into the gold reserves, CNBC was denied the opportunity to even film any of the gold in Fort Knox. They were told that it was a “closed facility”. One staff member even said that he was not aware of any member of congress having toured the facility since 1974.
According to a treasury document, a full audit of the gold would take 30 minutes per bar for a total of 350,000 man hours, or 400 men working for 6 months. Total cost would be $15 million. Sounds like a bargain to me. The government probably spent more than $15 million just to print and transport the $6.6 billion it lost.
Now I could go into gold swaps, cash settled leases, or even tungsten filled gold bars to make my point that 8100 tons of gold is probably not where the government claims it to be, but that isn’t really necessary. All I need to do is point to the Iraq situation above. Or any other of the millions of examples of graft that always occur in any government operation that isn’t conducted with complete transparency.
Am I wrong? No problem. This is easily settled. Let’s have our full, independent audit of the US gold reserves. Let’s see exactly how much unencumbered, assayed physical gold exists in our possession. This is easily accomplished, and really, could be a big boost for President Obama. He could finally demonstrate some of that promised transparency, and heck, he could even claim another 400 jobs created.