Dear Elon, the answer is hard money
Elon Musk’s epic feud with President Trump intensified with Musk’s announcement of a new debt-focused political party. Speculation on Musk’s motivations have ranged from loss of green subsidies, to administration personnel clashes, to genuine concern over America’s astronomical spending.
Taking Musk’s concerns at face value his solution is wildly off-base. The only way to tame government fiscal avarice is to return to hard money. Fortunately, the crypto revolution now makes this possible from the bottom up.
Government activity like human activity is dictated through incentives. Democrats, guided by Modern Monetary Theory (MMT), which abjures any limits on money printing, will never constrain spending because it buys votes. Republicans though more ideologically inclined constantly face the hard realities of electoral politics and flippant accusations of wanting starve children and push grannies off cliffs, laundered through a compliant media.
The End of the Gold Standard Created the Debt Problem
Most Americans have never known an era where government faced any real limits on its money-printing prerogatives. In 1971, Richard Nixon followed the rest of the world and took the US off the gold standard. Perhaps coincidently, what followed was a decade of oil shocks, stagflation, and economic malaise.
Yet the destructive consequences of Nixon’s move have only intensified in the half-century since. As Saifedean Ammous describes in The Fiat Standard, The Debt Slavery Alternative to Human Civilization, fiat’s degrading effects stretch well beyond our constant battle with inflation. It lowers our time horizons, makes us discount the future, transitions us from hopeful savers to instant-gratification debt-ridden spenders as we must become investment experts just to maintain the value of our earnings. It also puts a cadre of Ivy League intellectuals in the unenviable and impossible task of finding some ‘just right’ formula to balance discordant factors like inflation and the cost of capital.
The unnoticed effects are just as deleterious. Fiat money affects our food supply, the materials and design of our buildings, the priorities of scientific research, the frequency of geopolitical conflicts, among innumerable other issues.
This situation will not resolve from the top-down. But for the first time, it doesn’t have to. People, acting independently, can force government discipline by refusing to transact in money that constantly loses value.
Dear Elon, concentrate on crypto
Bitcoin is the most obvious candidate with its fixed supply, rock-solid and thermodynamically guaranteed network security, and brand recognition. But that is only one option. Other ‘Layer 1’ blockchains could emerge either “forked” from Bitcoin or built from scratch. Monetary policy is hard coded into these cryptocurrencies, free from political meddling—if designed correctly. People could also choose to return to the gold standard, through gold-backed stablecoins. This would eliminate the original gold standard’s main drawback, the cost of transport and salability over space.
This is already happening in profligate, MMT-infused countries where national currencies can devalue at scale. Dollar-backed stablecoins have proven popular in Brazil, India, Nigeria, Turkey, and Indonesia. One article dubbed Venezuela the “stablecoin capital of the world.” In 2024, total stablecoin transfer volume hit $27.6 trillion exceeding Visa and Mastercard combined.
The US dollar will only maintain its world’s reserve currency status if the government instills enough fiscal discipline to fend off harder competitors. Given that, under fiat, every dollar printed is an interest-free loan from the people to the state, this would be like taking candy from a child—it won’t happen voluntarily. Nor will it happen through the creation of a new political party. This futile exercise will only alienate Musk’s natural allies in Washington on this issue.
Dear Elon, make up with Trump
Trump has a penchant for forgiving enemies. Gobs of midterm cash would surely hasten Musk reingratiating himself into political reality. Whatever his motivations, if he is serious about reigning in the national debt, Musk should abandon his fanciful ‘America Party,’ and focus on America’s future. The harder the money, the brighter that future will be.
By Jossey PLLC
A version of this story appeared in The Hill on July 24, 2025, https://thehill.com/opinion/finance/5415024-dear-elon-the-answer-to-our-debt-problem-is-hard-money/
