Now it gets interesting. For several months I have been writing on the issue of honest money and its return to America, via the states. Judging from the response (or lack thereof), the issue is still very much off of the radar of the average American, including many hard asset advocates. Honest money is, however, quietly – and quickly – making its way into the main stream discussion.
Having attended the ceremonial signing of HB317 on June 2nd, I can assure you that the people of Utah are serious about providing the protection this law offers to their citizens. Rep. Brad Galvez, sponsor of the bill stated, “The law is not merely symbolic. Our intention is to strengthen the existing law and implement it.”
The speed at which this is all moving has caught the attention of the mainstream media. Both the New York Times and Los Angeles Times have published articles recently asking questions about the movement toward honest money. Not necessary the right questions, however the discussion has to begin somewhere.
Image cannot be displayedThe idea of using gold and silver as money has been in and out of the main stream press over the past several years. Relegated to what today's economists would call "the realm of wacko, archaic, economic dinosaurs," it hasn’t gained traction in the hearts and minds of the American people. This despite the tireless work of such dedicated individuals as Dr. Larry Parks, Dr. Edwin Vieira, Rep. Ron Paul, and dozens of others who had the audacity to read, study and understand the Constitution for the United States of America.
Let me go out on a limb and say those famous last words… “This time it is different.”
1) The United States is moving toward a debt/currency crisis of immense magnitude.
2) The American people are becoming increasingly aware of it, thanks to the tireless work of the above mentioned heroes.
3) There two new variables that make this latest iteration of the decades long sound/honest money debate different.
First of all, Utah has made gold and silver money once again. It is this anomaly – this “disturbance in the force” if you will – that has captured the attention of two of the largest newspapers in the nation. Why would a state actually pass a law to make constitutional money legal again? They are confused about the issue, as is evidenced by comments made by the reporters.
Nathaniel Popper of the LA Times opined. “The ultimate goal is to return the nation to a gold standard, in which every dollar would be backed by a fixed amount of precious metal.” This is a common misconception. Making gold and silver legal tender does not instate the gold standard, if we use that term in its proper historical context.
Enacting the “gold standard” would mean the gold (and silver if we use Utah’s law as a basis) is held by a central bank. Paper money (or electronic digits) would circulate and act as legal tender. The paper/digit money would derive its value by the precious metals held by, and owned by, the central banks. There would be no opportunity for the people to “demand” specie (physical metals) in exchange for their paper/digits.
With gold and silver as legal tender, the people own the metal. Thus, we the people own the money, not paper ticket (or digital) tokens that represent “value” based on someone else’s ownership of gold and silver. One doesn’t have to ponder too long to understand the ramifications of that very important differentiation. “He who owns the gold makes the rules.” Well… with the system put in place in Utah, the people are in a position to make the rules – not the central bankers.
The second issue that makes this time different is that unlike the past, there is now a practical means to implement a system where gold and silver can be used as legal tender alongside Federal Reserve Notes – and with the same convenience. The free market is combining 21st century technology with Utah’s law, and surprise, surprise – the result is that a solution is very close to being unveiled.
So what does the Federal Reserve think of all of this? You can bet your bottom “dollar” that they are watching for any vulnerability with which to attack this system. However, unlike what happened with the Liberty Dollar and its founder Bernard Von NotHaus, what if there is no legal recourse for the Fed? What if state law is on solid constitutional grounds? What if free market implementation solutions have the backing of the state(s)? What if those solutions operate legally within the confines of the existing finanical system?
In the past, legal and constitutional support has not been an obstacle to those who are in control of the monetary system. At a minimum, roadblocks will be leveraged to their full advantage (including leaving the Federal capital gains tax in place as long as possible). Beyond that, one needs only look at history to see their playbook. It isn’t pretty.
Only this time – things are different. “We the people” are awakening to the fact that there is an opportunity to take back control of our monetary future. States are beginning to step up and implement legislation meant to give us a fighting chance.
And a fight it will be.
While it has been a very long time, there is precedent for “we the people” winning in a battle with the central bankers. Andrew Jackson led the last charge to “root out the den of vipers.” It nearly cost him his life. In the end, it was he who "killed the bank" - an epitaph written on his tombstone.
Who will lead the charge this time? Rep. Ron Paul needs help. If he is to get it, it will not come from Washington, but rather from the legislators and Governors of the confederated states. Gov. Herbert of Utah was the first to step into the fray. Who will be next? We may not have to wait long to find out.
Larry Hilton was instrumental in helping nurture Utah’s law through to its ultimate passage. When I asked what the most important issue was facing Utah’s sound money initiative, he did not hesitate. “We need as many legislators as possible in as many states as possible to pick up the torch. Implementation of a simple bill in multiple states will strengthen support for sound money across the nation.”
To that end, he is planning a Sound Money Summit to be held in Deer Valley, Utah on September 26th and 27th. The purpose of the summit is to craft a "declaration of principles" that various states can agree upon regarding sound money. "The declaration will then form the foundation for model legislation." stated Mr. Hilton. "If the summit can accomplish those two objectives - agreement on a declaration and model legislation - will put state legislators in good shape going into 2012."
Here's to the Sound Money Summit. Mark your calenders. September 26th and 27th promise to be the next quantum leap forward as the states move to return to honest money.
