The Yellow Brick Road
The peculiar contagion of gold and silver narratives is exemplified by the
appearance of a social epidemic surrounding a children’s book by then-obscure
author L. Frank Baum. The Wonderful Wizard of Oz was published in May 1900,
at the start of the second presidential election campaign between McKinley and
Bryan, when bimetallism was again an issue. The book is a children’s story
about a young girl named Dorothy, who, with her little dog Toto, is transported
to the mysterious Land of Oz. The story is a sort of odyssey, as Dorothy, wearing
magical silver slippers and pursued by a witch, follows a yellow brick road to
meet the Wizard of Oz. Accompanying her are Toto and three newfound friends:
a scarecrow, a tin man, and a lion. In the end, the Wizard of Oz is shown to be a
weak little man who is a phony.
Some people read the book as a parable: the yellow brick road is the gold
standard, the silver slippers are the Free Silver movement, the Wizard of Oz is
President McKinley, and the Cowardly Lion is William Jennings Bryan. Oz itself
is the abbreviation for ounce, the usual unit of measurement for gold or silver.
The book did not garner critical acclaim, but it was a best seller, and became
contagious. By 1902 it was a “musical extravaganza” onstage. Its success went
meteoric with the release of the movie The Wizard of Oz, starring Judy Garland,
in 1939. (The film version changed the silver slippers into ruby slippers to take
full advantage of the relatively new color film.) Interest was renewed again in
1972 with an animated Journey Back to Oz with the voice of Garland’s daughter,
Liza Minnelli. The best-selling 1995 novel Wicked: The Life and Times of the
Wicked Witch of the West by Gregory Maguire led to a Broadway musical,
Wicked: The Untold Story of the Witches of Oz, which has been running
continuously on Broadway since 2003, as of 2018 the sixth-longest-running
Broadway musical ever.29 There are other examples too, including a 2013 movie
Oz: The Great and Powerful and a future Oz TV series under development in
2019 by Legendary Entertainment. The success of the Oz constellation might be
a vestige, barely recognizable, of a gold-silver narrative that went viral over a
century ago.

The End of the Gold Standard
The Bryan proposal to lower the precious-metal value of the US dollar was an
extremely emotional issue in the 1890s. It was so because of a narrative that
economic historians Barry Eichengreen and Peter Temin call the “mentality of
the gold standard” and the “rhetoric of morality and rectitude” that the gold
standard represented.30
By the 1930s, with the help of John Maynard Keynes, the narrative had
changed owing to the sense that unemployment was at catastrophic levels. An
article by Mark Sullivan in the Hartford Courant in November 1933, around the
time of the devaluation of the US dollar from 1/20.67 ounce of gold to 1/35
ounce of gold and the suspension of convertibility, explained how the new
narrative about the gold standard in the 1930s differed from that of earlier years.
The difference was partly a matter of new words. Sullivan quotes Talleyrand,
Napoleon’s chief diplomat, that “the business of statesmanship is to invent new
terms for institutions which under their old names have become odious to the
public.”31 The supporters of the devaluation apparently understood this. By the
1930s, the new word devaluation had massively replaced the negative-sounding
debasement and inflation. Devaluation refers to a constructive action of
enlightened governments, while debasement and inflation connote a moral
failing.
Other countries had already suspended convertibility of currency to gold coin
before the United States did so in a series of steps in 1933–34. On the advice of
eminent economists such as Keynes, the United Kingdom had suspended the
gold standard in 1931. The final end of the gold standard occurred in 1971 in the
United States under President Richard Nixon, with the switch to a floating dollar.
The public accepted the end of the gold standard, and economic dislocations
were few.
The gold standard narrative is certainly not prominent today. President Trump
tested the waters by advocating for it, but the public reaction was largely neutral.
However, the fascination with narratives about money certainly lives on, as our
running Bitcoin example illustrates. It seems likely that the future will bring new
mutations of the money narratives, which will arouse a segment of the public,
and which will affect future economic developments.
In these first three chapters describing perennial narratives, we have seen how

narratives can affect confidence in others’ confidence, the desire to engage in
conspicuous consumption, and beliefs about monetary institutions. In the next
two chapters we consider recurring narratives about the advance of dramatic new
technologies that had the potential make human skills obsolete and that forced
people to think about fundamentally changing standards of living and working.

Chapter 13
Labor-Saving Machines Replace Many
Jobs
Concerns that inventions of new machines that are powered by water, wind,
horse, or steam, or that use human power more efficiently, might replace workers
and cause massive unemployment have an extremely long history. These
perennial narratives are reappearing with modification in the twenty-first century
and could become important problems damaging confidence, as they did in the
past.
In this chapter, we consider a number of technology narratives, often using
the terms labor-saving machinery or technological unemployment, that went
epidemic and then faded (Figure 13.1), including the Luddite event in 1811, the
Swing Riots in 1830, the depression scare of 1873–79, the depression of 1893–
97, and the extended Great Depression of 1930–41.