On February 29th, Federal Reserve Chairman Ben Bernanke sat in front of his longtime nemesis, Rep. Ron Paul and testified on behalf of the Federal Reserve, attempting to justify the Fed’s monetary policy. During the testimony, congressman Paul did something unusual. He reached into his pocket and pulled out a United States minted silver eagle. He then informed Mr. Bernanke that when he took over as Chairman of the Federal Reserve in 2006 that silver “dollar” would buy 4 gallons of gasoline, while today it would buy 11 gallons. “That’s preservation of value” he informed the Chairman. He’s right, and this exchange underscores two reasons why it is critical for states to restore use of constitutional tender (gold and silver specie.)
First of all, to “preserve the value” of each citizen’s money. Mainstream media stories abound today predicting that gasoline will reach $6 per gallon this year. Combine that with an expectation that one ounce of silver is expected to rise to$50 per ounce during that same time period and you can see a trend developing – continued devaluation of the dollar, and continued preservation of purchasing power by sound money.
The second reason states need to restore constitutional tender is Dr. Paul’s warning that “the Fed is going to self destruct” when its policies lead to the eventual loss of control over the national currency – Federal Reserve Notes. When that happens, states that have not enacted sound money legislation will have no choice but to be subject to whatever the global banking establishment (IMF, BIS) decides the replacement will be. And if recent history is to be heeded (Greece anyone?), that means the loss of national sovereignty for any nation placed within its jurisdiction.
Furthermore, Dr. Paul also rightly pointed during his testimony that if “we the people” actually use U.S. minted gold and silver coins at par value ($1 for U.S. silver eagles and $50 for U.S. gold eagles) we could end up in jail despite the fact that U.S. law supposedly still allows us to do so.
These are some of the drivers moving states such as Utah, Missouri, Colorado, Washington, South Carolina and others to advance legislation codifying the status of gold and silver coin as legal tender according to the value of the metal contained in them. Political savvy and constitutionally minded legislators know that sound money offers protection of purchasing power, a choice in currencies and protection of their constituents from irreparable harm should the dollar collapse. This is the very reason bills in Missouri and Colorado have passed their respective committees and are moving toward a full vote, while other state sound money bills are being seriously considered in committee hearings.
Economic and political freedom will result if enough states have the courage to say “yes” to constitutional tender. Dr. Paul’s testimony proved why, and a growing number of people understand the urgency of this issue. Please join the battle for sound money in your state. The cause is advancing and needs to finish strong in the 2012 legislative session in order to carry momentum into 2013 and beyond.