You don't have to be a public choice theorist to see that you can only really run a system like this, where domestic wages and prices do most of the adjusting to external prices, if you are not a democracy. While widgets, potatoes, steel, and pneumatic pumps care not one jot about their supply price, labor most certainly does care, especially when that price (wages) goes down. By making the mechanism of adjustment the random inflation and deflation of prices and wages, a great deal of uncertainty, and unemployment, was created in these economies. It also created conditions where the domestic monetary authorities, to maintain that all important gold cover, would pursue austerity policies such as cutting spending and raising interest rates to shrink deficits, keep gold at home, and defend the currency. It was hardly surprising, then, that it was under the gold standard that labor across the world, both industrial and agricultural, started to join together in unions, political parties, and social movements to demand protection from the vagaries of the market and the policies of their own governments.

Mark Blyth, Austerity, loc. 492