From Stark
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.
–Article I, Section 10, U.S. Constitution
Raise your hand if you knew that was in the Constitution.
State Rep. Jason Overstreet, R-Blaine, knew it. Now he’s doing something about it. He is one of three sponsors of H.B. 2731, the 2012 Gold and Silver Legal Tender Act of Washington state.
I have emailed Rep. Overstreet for some clarification and explanation. At first glance, it almost sounds as though the bill would call for state coinage of gold and silver, but I may be misinterpreting its language.
As I interpret it, the bill would not go so far as to outlaw paper money, and would uphold everyone’s right to continue to use paper money if they choose to do so. But it would also make sure that state residents who prefer gold or silver could conduct their business in bullion if they choose.
Whatcom County Treasurer Steve Oliver said he’s bewildered. Just months after state voters decided it was time for the state to get out of the liquor business, Oliver said, ”we’re seeing a proposal to create a state bank and a state gold exchange … We’re putting the state back into highly competitive businesses.”
Beyond that, Oliver is not thrilled at the prospect of having to accept gold in payment of taxes. How does he make sure the gold presented for payment is real? How does he secure it?
He also agreed that he probably won’t really have to worry about it.
My hand is raised
Once again, Jason Overstreet is addressing the pressing concerns of his constituents. Hey, here’s an idea, how about instead of worrying about being able to buy a big mac with a gold coin, or traveling around the state trying to deny Washingtonians their equal rights (http://www.northkitsapherald.com/news/137222523.html), why don’t you try working on creating some jobs for the people you represent? Or fixing our failing infrastructure, or helping out our schools? Or any one of the more pressing issues that matter to the people of Whatcom County.
I suugest a more to the point bill. All sponsors of said bill should be paid by the Sate of Washington for their legislative work with gold dust. It would make us all happy.
Looks to me like this Bill was written by “soveriegn citizens” with an attempt to legalize tax evasion buried in it.
A lot of Overstreet’s rhetoric seems to come from that anti-government, domestic terrorist fringe.
Jason Overstreet or Jason Oathkeeper?
Dan, how about Jason be paid with fairy dust, or if you prefer, pixie dust? That may better reflect both the value of his work for us in Olympia, and the likelihood of his bill seeing the light of day. Holy cats, is he the most out of touch person ever elected?
Also, some nit picky details. In the proposed bill, our Jason proposes the State provide this gold or silver currency. However, states are expressly forbidden from making legal tender coinage. He also proposes that old US gold and silver coins serve as payment. However, the largest denomination coin is the gold $20 ” double eagle”, which contains nearly an ounce of gold, trading at $1700 or so. The state cannot re-denominate values of us coinage or currency. Also, if the price of gold falls back to values that were current recently, does that not represent a confiscation of property by his same logic?
Count’em six, ok now seven senseless/partisan comments including one that aligns our local Rep with an anti-government, domestic terrorist fringe.
I suppose they could all be true in some Democratic Pary fantasy world, but it is more likely that Rep. Overstreet is part of a normal and real trend of legislators across our nation trying to stabilize the investments of their constituents against a shrinking US dollar.
Wally, I wonder at your reply. Sure, the fairy dust thing was off the wall. My second comment was serious, with real, honest facts and questions. Here are one a few for you, or maybe the good Rep. Overstreet will choose to appear here and correct my errors and misconceptions.
First, in what way has our dollar shrunk, or if you prefer, what measure do you use to define the declining value of our currency?
Many cite the decline in the exchange rate with other currencies as one measure. How many of these are based on a gold or silver standard?
I repeat a question from my previous post. What will the result be if gold and silver prices fall, perhaps precipitously, back to values that prevailed 5 or so years ago?
I am presently paid by the State of Washington in electrons; all WWU employees must use direct deposit, so I do not even get this Fiat Currency our Jason’s proposed bill speaks of. What will the gold to electron exchange be set at?
Many of my taxes are paid as sales taxes. Will local stores need to set up a system so I can pay just the tax in gold? Is that not a burden to small business?
My property tax is paid, using those electrons, with my mortgage payment. It would seem that all of the banks and other brokers that deal with mortgage payments in this way would also be required to set up payments in gold or silver. Again, that seems to be a significant burden for those businesses, yes?
What say you, Wally?
Again, I repeat my point that is messing around with paying people in gold coins really top of anyone’s priority list right now? Just goes to show how out of touch Rep Overstreet is with the concerns of his district.
I believe the bill:
a) Acknowledges the portion of the U.S. constitution that allows states to regulate gold and silver as currency: “Only gold and silver may be recognized as government legal tender under Article I, section 10 of the United States Constitution, which gives the states the power to enact gold and silver based legal tender laws, “no state shall . . .; make any Thing but gold and silver Coin a Tender in Payment of Debts.”
b) Provides a definition of what is considered to be gold and silver currency (no making something up in the basement) “NEW SECTION. Sec. 3. MONETIZATION. Pursuant to the monetary authority expressly reserved to the states in Article I, section 10 of the United States Constitution, the following is declared to be state legal tender:
(1) Federal specie gold and silver coin at any time issued by the general government of the United States of America;
(2) Domestic specie gold and silver coin; and
(3) Foreign specie gold and silver coin monetized by any other state or country.”
c) Makes a law that the use of god or silver is completely voluntary “NEW SECTION. Sec. 5. PRIVILEGES AND IMMUNITIES. (1) The use of gold and silver is strictly voluntary and no person or entity may compel any other person or entity to tender or accept state legal tender”
d) Prohibits the State of Washington from taxing or imposing fees on gold and silver: “NEW SECTION. Sec. 6. TAX AND REGULATORY TREATMENT. (1) No tax may be imposed on the sale, exchange, or other disposition of any gold or silver coin, gold or silver metal, gold or silver token, gold or silver bullion, gold or silver bars, or gold or silver ingots, whether issued by the United States, a foreign government, or any other entity or person.
(2) The state of Washington may not assess any tax or fee on any currency, or any other monetary instrument, which is used in the transaction of interstate commerce or commerce with a foreign country, and which is subject to the enjoyment of legal tender status under Article I, section 10 of the United States Constitution.”
Looks to me like the legalese to make sure that when people who are buying or selling gold do not have to pay sales tax or other fees that may have been incurred during the transaction. (re: sales tax)
Yes, Riley, your point is the most important one. I wonder if Wally can answer that concern. At the end of the his first term, it looks like Overstreet’s record will be a set of bills that do not make it out of committee, a whole lot of no votes, and not much else. I suspect we can do better, and definitely the 42nd district, and the State for that matter, deserve better. How’s that?
“a set of bills that do not make it out of committee, a whole lot of no votes, and not much else.”
If you believe government has no function and no right to exist in any form, what more could you hope for than to occupy some seat in order to prevent someone who disagrees with this from occupying it in order to get something done? Government is worthless to Jason Overstreet, and, by God, he aims to prove that in his every action or inaction.
This is excellent news for all those who invest in gold.
I think it was midway through last year that Donald Trump either bought or sold a property in gold alone.
Hopefully we can once again peg our currency to the metal.
Is Vincent Buys sponsoring a parallel bill in the House?
Gotta love people who think precious metals hold some kind of magic economically.
You pay a premium to buy some,
take a discount to sell some
and then rely on speculators and nervous reactionaries to set its value
minute-by-minute.
And when paper currency collapses,
you’ll need to carry your ACME Gold Scale and Conversion Kit into Safeway to get your gallon of milk
if you can safely make your way past the hordes of hungry in the parking lot who foolishly clung to their electron wealth.
A waste of time for very little useful function and so it’s a shame we have a Rep who dawdles in meaningless posturing instead of building our community.
Well as I said, this is a normal and real trend that many feel will have a positive effect on some of our economic issues. Since the economy is the number one issue in…well the world, our nation, our state and the focus of recent state special sessions it might be worth checking this issue out with an open mind. Here’s a news blurb link as a start http://www.youtube.com/watch?v=FY8VIExEsRQ or just Google it.
Alternatively, you could follow our governors lead and act like the word “marriage” is the most important issue or you could make pithy comments about carrying gold around.
Either way enjoy your weekend.
If the Government told Wally
whom he could not marry,
he’d altar his attitude in a hurry
Wally, I am aware that this proposal is not an isolated proposal, so I do not doubt the reality of this issue. Not sure about the trend part. My questions to you, or to Rep Overstreet, we’re in fact the result of some real honest thought. I am sorry you do not seem to think so, and wonder if you can do more to clear this up than to post a YouTube clip or web link? Honestly, though, if this is a reflection of Rep. Overstreet’s priorities for government I am not impressed. There is also, lurking behind the smoke and mirrors about using gold as payment for taxes a tax-break for folks who buy and sell gold and silver. Another serious question for you, Wally. Why should those simple commodities be granted a sales tax exemption, when others, such as copper, zinc, aluminum, coal, pork bellies, platinum, rare earth elements, diamonds, etc, are not? Is this not an example of government intervening in a free market to pick winners and losers, interfering with the actions of that invisible hand? Or, is it a simple case of crony capitalism?
Frankly, it is refreshing to see legislators actually stand on the basis of law in this state – THE CONSTITUTION. If you don’t like it, change it. By the way, Overstreet and Buys were 2 of the very few in the house who have tried (unsuccessfully) to uphold the constitution in the budget negotiating process by making the house fully fund public education first then deal with the rest of the budget issues. You may not agree with their politics, but you cannot summarily choose which parts of the constitution you like and you don’t. It is either law or it is not. If you don’t like the constitution, there is a process to change it. I applaud both of these gentlemen who are trying to refocus our attention on the priorities already laid out in the constitution. Would that more of our so called leaders would do the same.
There is more wealth and need for currency than there is gold available. So I don’t think we need to literally use gold. What we do need is for the Fed to stop printing bogus extra money over and above the actual value of the wealth we have.
RM, bogus extra money being printed? I am certain you can find many references to the Fed printing tons of this so called bogus extra money on those internets, but there is no real evidence out there that our currency is being debased. You are right that it is silly to tie the currency supply to a certain commodity in this day and age.
Actually Bernie, RM has a point. Reference an article in Bloomberg (not exactly a conspiracy outfit) from the end of November last year that exposed the 7.7 trillion dollar secret loan program the Fed enacted to aid struggling banks in 2008-2009. That was money that was printed and released at near zero rates to banks with no knowledge or oversight by anyone in Government. The only reason we know is that Bloomberg filed a FOIA request in March of 2011 and after being denied by the Fed, fought the Fed and 6 major banks all the way to the Supreme Court in August (and won).
http://www.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress-gave-banks-13-billion-in-income.html
no real evidence?
If I had put gold bricks in my desk drawer in year 2000, and pulled them out now, I would have done quite well. Not because “the price of gold has gone up”, it’s because we now need a higher number of puny devalued dollars per gold brick.
in 2001, i could get $1.60 Canadian for my USA dollar, now it’s straight up even par. Did Canada get richer and more prosperous… no, the Euro and the Yen and all other currencies also ask for far more USA dollars per each of their units. It’s because we are spreading our actual wealth value over more dollars and dollar bills than we used to.
Study the Weimar Republic. Germany tried to pay off WW1 debt by printing extra money, but they didn’t have the actual wealth value to back it up. Next thing you know, you needed a wheelbarrow ful of billions of German Marks to buy a simple loaf of bread.
Intentional inflation in order to do government spending that nobody approved. They tax us at the back door. We have the same number of dollars in our bank account and wallet, but it magically buys less.
Study up on this. I’m not making this up.
Interesting math there saying inflation is caused by the finite wealth we own being divided by an ever increasing number of dollar bills.
So GDP doesn’t really grow – it’s merely the domestic money supply.
Productivity gains are an illusion even as wages fall since The Fed is creating all the dollar riches we can’t earn for real on the job.
And the rush to sell your national resources – say like Canada does – only means you can ask more for your Loonie when you spend it against The Fed’s Dollar,
not that there’s growing demand for your market
or that it keeps currency traders keen to buy your money too
which boosts its value Worldwide.
So if printing American dollars makes our economic prosperity faulty,
what about other nations and their own paper cash inflation?
But more to the point
the World spot price of gold has nothing to do what the Fed does with our money supply.
We need more dollars per ounce of gold because our dollars are weaker, not because gold got better.
The value of gold has stayed fairly consistent while our dollar has weakened. That looks like “gold got more valuable”. That is an illusion. and yes, Euro and some other currencies are playing the same tricks to syphon wealth out of their currency cookie jar.
Gold gets better?
Or, since there’s a finite supply,
its value in every world currency climbs as buyers willingly bid it up for emotional,
not rational reasons.
A finite supply of anything valuable arbitrarily increases in cost
which explains resource economies and oil companies and Peabody coal and Cabbage Patch Dolls.
A finite supply of American dollars with a Gold-defined value is a sad myth
since our economy would certainly come to the same end as all other cornered and closed monopolies.
RM- if, however, you had purchased your gold in 1980, you would still be “in the hole”. Gold values, like all commodities, have experienced significant, and sometimes unexpected, fluctuations. If your concerns about the inflation of the USD were a really significant effect, then values of all commodities and all other currencies relative to the USD would have the same “signal”. Right now gold is a trend- we have “Gold Rush” and “Bering Sea Gold” on TV, just like we had “Flip that House” on TV in 2006. Many, probably most, economists predict the value of gold, and silver, will decline in the near future as the pressure driving its present speculative peak subsides- so you may wish to cash in now, maybe?
Back to the real topic- will the time and effort that our Jason, and his co-sponsors, spent on this really, honestly, have ANY impact on US or WA monetary policy? I already feel like I’ve wasted too much of my own time on this topic here, and I presume (and hope, actually) that Rep Overstreet and his staff must have spent considerably more time on this question prior to bring the bill forward (and will also spend more time in hearings, etc, supporting this bill). The fact that so much time and effort is spent by my representative on a dubious and really ineffectual legislative gesture is the real problem. In his Herald Op-Ed article, he (Rep Overstreet) wrote that a useful litmus test of whether state government had something to do would be to see if the same service is available in the yellow pages. Well, there are several coin and precious metals shops in town that will take your gold or silver, look up the current spot market value, and pay you for your gold or silver with either cash money, or a check issued to you there on the spot. If you want to save up gold or silver to pay your taxes, it does not seem very difficult to drop by one of these businesses, sell your gold or silver, and then go pay your tax.
RM, you may not be making this stuff up, but you are oversimplifying the issue. Taking currency issues down to the ‘gold=good; paper=bad, level not only fails to properly address the problem, but also at the end of the day leads to wrong answers and conclusions, such as those offered by the esteemed 42nd District Representative.
And your history is inaccurate. Gold values go up when uncertainty is greater, and also in response to supply. Silver hoarders learned this lesson dramatically in the late 1970s when the Hunt Bros tried to corner the market. Every grandma’s silver set was suddenly on the market, being melted for cash, and silver subsequently and dramatically crashed. Gold is not sitting around in the same quantities, but the same principles apply.
It’s true that an overly aggressive expansion of the money supply is one of the causes of uncertainty, and often correlates with higher gold prices–and higher commodity prices generally. If the money supply expands at the rate of economic expansion, prices stay more constant, and if it fails to keep up with growth, it ends up choking growth. This is still way too simplified, but a bit more of the picture. The bottom line is that the gold standard is no more of a cure for monetary supply management today than it was in William Jennings Bryan’s day, but it still carries a simplistic appeal to a complex problem..
As Mr’ Housen points out, it also leads to a lot of wasted time, which I would think our Reps could ill-afford to do right now.
Dan,
I believe you have further over-simplified the issue by failing to consider the impact of fiat currency, which the US dollar currently is. Your assertion that “the gold standard is no more of a cure for monetary supply management today than it was in William Jennings Bryan’s day” ignores the advantages of using a gold standard to minimize the impact of fiat money.
As I have recommended to others previously, you might enjoy reading G. Edward Griffin’s THE CREATURE FROM JEKYLL ISLAND: A Second Look at the Federal Reserve.
Hopefully my friend Greg Kirsch will chime in and add his 2 cents.
Any legislation that I personally disapprove of is a waste of time, a distraction from more pressing legislative matters.
Here’s an interesting illustrated page dealing with the Weimar inflation from the perspective of stamp collecting.
http://www.lingens.com/articles/roy/germinfl.shtml
Larry,
Goopd to see you’ve found your own name to post under again…
John,
That’s one definition of a waste of time. I prefer that legislation which is beyond the scope of your authority is generally a waste of time, although any legislation may include messaging about one’s political position on issues relevant to the legislation, in which case it could be argued it helps further those issues, even if the platform is local and the issues are national.
For what it’s worth, Larry, I don’t think fiat currency is the problem, nor hard money the solution. All media of exchange, gold, silver, copper, sticks, stones, shells (they’ve all been used) rely on the confidence that they represent a reasonable store of value.
The creature from the Georgia coast unhinged things by privatizing the public’s (ie Congress’s) function as the creator of credit. Again, it’s critical to remind the reader that the Federal Reserve is not federal, and hasn’t anything in reserve; that the bankers, even then masters of fractional reserve lending, designed it to be the lender of last resort and a way for them to reach the public purse.
Personally, I believe our current problems result from expanding the money supply, not to facilitate the production and consumption of goods and services, but to accommodate the needs of speculators who should never have been granted the opportunity to create credit and manipulate it for private benefit. Some 13 trillion on the Fed’s books went to bailout investment bankers who circumvented the safeguards put in place after their speculative bubble burst in the 1930s.
I appreciate the difficulty young Republican believers face acknowledging the role the masters of their little universe played in this debacle. But the ensuing debt bubble, largely on the books of the Fed, won’t be deflated with a golden sword. In the end, we all bleed to balance the books.
Lots of heat here about gold, but I think that this article is germaine:
http://makupfront.tumblr.com/post/16795579657/washington-state-downgraded-by-moodys
This is great! I hope it passes I am sick of seeing my purchasing power destroyed through inflation. I can remember when gas was under a dollar. Since the Federal Reserve also know as a Private Banking Cartel started printing US dollars and loaning them to the US treasury plus interest. The dollar has lost over 96% of its value. What a disaster!
“Forbes Predicts U.S. Gold Standard Within 5 Years…
Such a move would help to stabilize the value of the dollar, restore confidence among foreign investors in U.S. government bonds, and discourage reckless federal spending, the media mogul and former presidential candidate said. The United States used gold as the basis for valuing the U.S. dollar successfully for roughly 180 years before President Richard Nixon embarked upon an experiment to end the practice in the 1970s that has contributed to a number of woes that the country is suffering from now, Forbes added…..
With a stable currency, it is “much harder” for governments to borrow excessively, Forbes said. Without lax Federal Reserve System monetary policies that led to the printing of too much money, the housing bubble would not have been nearly as severe…
http://www.humanevents.com/article.php?id=43439
AFY!!theheelotsheepdog!!!
“In February, J.P. Morgan Chase announced it would allow its clients to use gold as collateral for some loans.
Kansas City Federal Reserve President Thomas Hoenig said in January the gold standard is “a very legitimate monetary system” that could provide a longer period of price stability…..
“The reason it’s more feasible now is that we are running out of answers to the monetary and financial chaos now. In 2008, when huge investment houses and banks started failing, people just couldn’t get a loan, the whole system was paralyzed,” said Jeff Bell, an adviser to Reagan in his 1976 and 1980 presidential campaigns….
The liquidity that the Federal Reserve created caused a bubble that “blew out millions of Americans’ investment in their homes,” he said. “The system is subject to these continuing crises now, and there’s more and more inflation in the economy, so the time is right.”
http://abcnews.go.com/Politics/tea-party-momentum-utah-bill-brings-gold-standard/story?id=13377409
AFY!!theheelotsheepdog!!!
Kirsch understands.
Again, it does not have to be gold in particular, or any other physical commodity in a vault. We just need for them to have rock solid restraint that actually prevents them from fudging the quantity of notes so much and so often and for all the wrong reasons.