WASHINGTON - The present US monetary system is an abysmal failure and the value of the dollar has been manipulated, according to a former Federal Reserve official.

"For the last 40 years in Washington, regulate has meant manipulate, with the Federal Reserve raising and lowering interest rates and buying and selling assets at its own discretion," Herman Cain, the former chairman of the Federal Reserve Bank of Kansas City, said in an article published Monday by The Wall Street Journal.

"All of this manipulates the value of the dollar," he noted.

Cain argued that however imperfect a gold standard may be, it remains the best among all alternatives. During the time of the classical gold standard and the flawed "gold-exchange" standard, the U.S. economic growth was stronger, unemployment rates lower, the price level more stable, and recessions less frequent and less severe than under the present monetary system.

In his view, a dollar should be defined -- as it was prior to 1971 under the postwar Bretton Woods system -- as a fixed quantity of gold.

However, Cain added, the Washington establishment goes ballistic at this suggestion because gold is "Kryptonite to big-spending politicians." "It is to the moochers and looters in government what sunlight and garlic are to vampires," he explained.

The U.S. central bank has kept the interest rate at exceptionally low level since late 2008 and conducted two rounds of assets buying since 2009. It reaffirmed after its latest policy-making meeting that it would keep current ultra-loose monetary policy at least through late 2014 to support economic recovery.

The Fed's unfettered asset-buying has provoked criticism even from its top officials who said the Fed should have clear limits on how much and in what way it can expand its balance sheet. It should not blur the lines between its monetary policy and the U.S. government's fiscal policy.