Newton on gold: "Gentlemen... you must describe your unit."

"Newton (the grand architect of the gold standard)... replied:  'Gentlemen, in applied mathematics, you must describe your unit."

[Master of the Mint and inventor of the gold standard] "Sir Isaac Newton was asked by the British Treasury officials and financiers of his day why the monetary pound had to be a fixed quantity of precious metal.   Why, indeed, must it consist of precious metal, or have any objective reality?  Since paper currency was already accepted, why could not notes be issued without ever being redeemed?  The reason they put the question supplies the answer; the government was heavily in debt, and they hoped to find a safe way of being dishonest. But Newton was asked as a mathematician, not a moralist.  He replied: 'Gentlemen, in applied mathematics, you must describe your unit.'  Paper currency cannot be described mathematically as money.  A dollar is a certain weight of gold; that is a mathematical description, by measure (weight).  Is a piece of paper of certain dimensions (length, breadth, and thickness, or else weight) a dollar?  Certainly not.  Is a given sized piece of paper a dollar even if numerals and words of a certain size are stamped on it with a given quantity of ink?  No. 

Newton_on_the_One_Pound_note

"They took Newton's word for it, possibly conceding that the greatest mathematician of their age might know the primer of his science.  But the fact that educated men were ignorant of the first rule by which they carried on their own business, commerce and finance; and the further fact that Newton's answer has since been forgotten many times, in spite of the disastrous consequences that ensued each time, indicates a very grave problem of civilization."

from The God of the Machine, by Isabel Paterson, pp. 203-204, with thanks to Dr. Larry Parks for having shared this wonderful literary vignette.

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