To give a concrete example, assume we have a commidity backed money. How would the transition from the dollar to gold proceed? For instance, no one has gold right now, how would they get it? How would a business obtain gold to give to their employees? Would it be as simple as tying the money supply to the gold in Fort Knox (assuming it’s still there). Or is it more complex than that?
It would have to be a free market gold currency.
Yeah, the first step is taking away the Fed’s monopoly on the money supply and allow private companies to start competing with it. It would probably take a while for it to catch up but eventually people would start adopting gold and refusing to accept Fed notes as they became worth less and less.
A statist way of doing it would be to establish US Notes that were backed by the gold and silver stored in government vaults as well as what the Fed was holding in New York (which would have to be confiscated by the Fed and placed in government vaults). The Treasury department would then issue the competing US Notes and over time people would begin demanding them since they didn’t lose their value. I suppose if legal tender laws were repelled there really is no big issue with the Treasury department issuing a competing currency so long as private mints and banks could also do so. But the key to it all is destroying the Feds monopoly over money.