The Edison Money Plan

Bloomberg:

During the sharp recession of 1921- 1922, Thomas Edison turned from making innovative consumer products to reinventing the U.S. monetary system.
He was driven to economics by a sincere desire to be useful in a crisis and by his friend Henry Ford. Ford had proposed that the federal government issue paper dollars -- effectively zero- interest bonds -- to finance the completion of the Wilson Dam on the Tennessee River, which he would then buy from the government. Ford took Edison to the dam site, and Edison was impressed with the proposal.
Responding to Ford’s plan, Edison searched for new ways to stabilize the dollar, the value of which had fluctuated widely during World War I and its aftermath. His goal was to “cast the variable out of money.” Distrusting bankers -- the “money brokers,” he called them -- and a monetary policy based solely on gold, Edison called for a system that used a variety of other commodities as backing for the nation’s paper money supply. (He would have eliminated gold entirely, but he knew that switch- over costs and international economic ties required retaining it, at least temporarily.)
His plan called for the federal government to build warehouses across the country where farmers could bring their wheat, corn, sugar, cotton and other crops and commodities and receive an immediate cash payment of 50 percent of each item’s average price over the past 25 years. The farmer would also receive standardized, marketable certificates indicating ownership of specific quantities of the crop. For example, if the average price of wheat was $1 per bushel, and the farmer brought 1,000 bushels to the warehouse, he would receive $500 and 10 ownership certificates for “100 Bushels of Wheat.”
The government would store the crops for as long as a year for a nominal fee. The farmer could sell the certificates or use them to redeem the wheat. To redeem 100 bushels from a warehouse would require paying $500 and surrendering the ownership certificate. The ownership certificates would fluctuate in value depending on spot prices, but the farmer could sell them at any time short of one year and cash out.
Edison thought the plan would reduce risk to farmers and give them a guaranteed amount of cash to pay off their loans. Gone was the gold monopoly, or so he thought. With 36 commodities backing money, in addition to gold, farmers would no longer have to dump their crops on the market at harvest time. They would have a price floor they knew with certainty, and -- if they wished -- they could try to gain from rising prices by holding their ownership certificates. Meanwhile, the government was warehousing the crops.

Farmers were on board, but most economists were not.  Today, Republicans push for a commodity backed paper money in place of the fiat system we have.  I don't see it happening, although the funds have been using commodities since 2006 or so as a hedge investment against inflation.  Also, Chinese companies supposedly have been buying commodities and using them as collateral to get around government limits on credit.  These have been a couple of the main factors in driving commodity prices to record highs.