Wednesday, June 17, 2009

Debasing Our Currency

From the The Coinage Act of April 2, 1792
(1 Stat. 246)
Section 19. And be it further enacted, That if any of the gold or silver coins which shall be struck or coined at the said mint shall be debased or made worse as to the proportion of the fine gold or fine silver therein contained, or shall be of less weight or value than the same out to be pursuant to the directions of this act, through the default or with the connivance of any of the officers or persons who shall be employed at the said mint, for the purpose of profit or gain, or otherwise with a fraudulent intent, and if any of the said officers or persons shall embezzle any of the metals which shall at any time be committed to their charge for the purpose of being coined, or any of the coins which shall be struck or coined at the said mint, every such officer or person who shall commit any or either of the said offenses, shall be deemed guilty of felony, and shall suffer death.

It sounds like our founding fathers were a little serious about their money. I wonder what they would think of the current lot of rounders who occupy Washington, DC, today, who are not content to debase the currency 100%, but are now debasing even that? Out predecessors were so serious about unbacked money that even Lincoln's piddling little foray into United States Notes reverberated anger for fifty years. And that was a parallel currency to provide liquidity in times of hoarding.

The United States Constitution itself is also rather serious about its money. From Article One, section 10 reads:
Section 10. No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility.
It sounds like a restriction only on the states, but it is a restriction on itself as well, for in those days we truly were the United States of America, and not the People's Republic of America as we morphed into from the early 20th Century under the Progressives culminating in President Obama. And the Federal Government restricted by the Constitution and the Ninth and Tenth Amendments could do nothing that the states could not legally do unless written into the Constitution.

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