We've vacillated between fiat and hard currencies at various times in our country's past. The argument for fiat currency is that economic downturns aren't as severe. Of course, economic upturns generally aren't as prosperous either.
We went off the Bretton Woods Gold Standard in 1971. The periods between 1971-1982 and 2000-2012 saw very poor productivity growth from a historical standpoint. Some people use these periods to demonstrate the shortcomings of fiat system. That's fair. On the flip side the period between 1983-2000 saw good productivity growth...but there's a caveat: Reagan, Bush I, and Clinton were all proponents of a strong dollar. People get caught up in Rs and Ds, but it's not always so simple. Reagan and Clinton were very similar in their management of the economy. During their administrations, even though we weren't technically on a gold standard, the value of the dollar tracked very closely to gold.
Conversely, Bush II and Obama both favor a weak dollar as a means of making our exports more attractive to foreign buyers. Consequently, the dollar doesn't track well with gold.
