Money: Gold and Silver vs. Fiat

No. The federal government CANNOT do "whatever is not prohibited." Sheesh.

I would wager a reasonable amount of money that the vast majority of Americans don’t know that the U.S. Constitution demands that states use ONLY gold and silver for money.

Article 1, Section 10, of the United States Constitution says that states are denied the power to “make any Thing but gold and silver Coin a Tender in Payment of Debts…” (Sates are also denied the power to “coin Money.”)

This means that only gold and silver (coins) are constitutionally allowed to be used as money to buy, well, anything (or at least for any transaction that might be legally enforced by a state government. People can always barter on their own, of course.).

This means that all that paper money, all that digital wealth that people rely upon to live and that is not ultimately tied to gold or silver has no legitimate place in our nation’s economic activity. So-called money printed or arbitrarily created by federal government mandate is fiat money, that is, it is backed by nothing physical; it is simply created on a whim and backed by ephemeral fairy dust that is accepted as a medium of exchange by the general public…for now, anyway.

For statists, this is a feature, not a bug. Not enough dough to meet the unconstitutional spending of the feds? No problem! Just enter some numbers into a computer and/or set the printing presses in motion. Problem solved.

Except it isn’t.

Inflation has stolen about 98% of the purchasing power of people’s money in the last century. A hundred years ago, about two pennies would buy what today costs a dollar to purchase. (I say “about” because inflation continues merrily rolling along…) In other words, you would need about $50 today to equal $1 in 1913, the year the Federal Reserve was created.

Such a deal…

Confiscating gold, taking the United States off the gold standard, printing fiat money: all are unconstitutional—and hence, illegal—policies that have landed us in the darkening pit where we find ourselves today.

“But, Russ!” I hear some ignorant voices crying in the wilderness. “The Constitution says that the federal government does have the power ‘To coin Money, regulate the Value thereof…’ (Article 1, Section 8) There’s nothing in the Constitution that says the federal government can’t have a fiat money system. So you’re just full of shit, you butthead!”

Eee-yah…

Hooboy.

Well, first of all, such an objection ignores what those who wrote the Constitution considered to be real money. During the war, the newly minted nation had gone down the destructive road of fiat currency. Naturally, that path resulted in disaster. “Not worth a Continental” was more than just a saying…

These men knew that only money based on gold and silver was stable and would not result in the disguised theft of citizens’ money via inflation. Fiat “money” was not an option when they were constructing the Constitution.

To pretend that those folks meant anything other than gold and silver in granting the federal government the power to “coin Money” is disingenuous, equivocating, and out-and-out deceptive. Gold was money. “Fiat” need not apply…

A second point to address is that the only source of money available to the federal government is the money produced by the citizens of the various individual states. The federal government either directly steals that money from people via (mostly) income taxes (again, the present federal system of income taxation was established in that horribly banner year of 1913…) or stealthily via inflation, that is, artificially increasing the money supply and paying off old debt with money worth less than it was when the orginal debt was incurred.

But the Constitution makes it crystal clear that citizens of the various individual states are only allowed to use gold and silver to pay their debts! So, since all citizens are first of all citizens of states, and since those citizens are only permitted to use gold and silver to pay for debts—including debt incurred via immoral income taxes—then that means that those citizens must use gold and silver to pay those taxes! In the system devised by the Constitution, there is no room for fiat money. Period.

To repeat: since the only source (in the final analysis) of money for the federal government comes from its citizens; and since those citizens are required to use only gold and silver; then the federal government is only allowed to use gold and silver, as well.

It boggles the imagination to think that this is in any way, shape, or form an ambiguous fact!

To twist the Constitution into knots to “justify” fiat money now is little different than statists distorting the Commerce Clause—designed to prevent barriers to trade among states—into an authorization for economic intervention or any of the myriad similar lies to “authorize” tyranny. That’s an act of supreme intellectual hubris…or an amazing evasion of one’s own delusional and deceptive state of mind.

Of course, my “hypothetical” opponent makes an even more egregious error in asserting without a shred of evidence that “since the Constitution doesn’t prohibit the federal government from using fiat money, then it can just go ahead and do so”!

Man. Talk about subverting and inverting the whole purpose of the Constitution!

That document explicitly states in the preamble to the Bill of Rights that the Founders wrote what they did “in order to prevent misconstruction or abuse of its powers,” and that to accomplish that goal, they decided “that further declaratory and restrictive clauses should be added” (emphases added).

Anyone who has done an iota of research into this area knows that the federal government can only do what it is explicitly authorized to do. That is what “enumerated powers” and “delegated authority” mean!

Imagine “delegating authority” to a lawyer to write up your will, but then she decides to sell your property and keep the proceeds because you did not explicitly tell her she could NOT do such a thing!

Oy!

There is no enumerated power or delegated authority in the Constitution to permit the feds to create fiat money. There is only the power to “coin” (gold and silver) money (as explained above)! Fiat money was anathema to the Founders. To pretend that they would leave any wiggle room for such an abomination is, well, an abomination…

Worse than supporting fiat money is the absolute insanity of claiming that the federal government can do anything and everything that is not directly prohibited or restricted. (An absurd argument once advanced by a brother-in-law, who was a chief-of-police in my home town. Jumping Jesus on a stick…)

For reals?!?

That is the fast track to tyranny.

There are a semi-infinite number of aspects of reality that the federal (and state) governments are not directly banned from interfering with.

The Constitution does not ban the feds from dictating what you eat for breakfast or how much exercise you get. Does not automatically mean the government can properly issue edicts influencing those activities?

Nonsense.

Ninety-plus-percent of what governments do already violates the Constitution and/or our rights: “gun” control; the “Drug” war; retirement; health care; highways; and on and on and on.

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Any government has one-and-only-one legitimate function or purpose: to protect our rights.

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And printing fiat money is not part of that.

In the end, even if the federal government has the Constitutional power to “coin Money,” it shouldn’t have and does not need that authority. There is no need for it to do other than to “regulate” (make regular; consistent) the value of money, in the sense of dealing with fraudulent money or those who attempt to cheat their customers.

But even given the Constitution as it is, there is no prohibition against the private production of money.

Indeed, this right is protected by the Ninth Amendment—“The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.”—and the Tenth Amendment: “The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.”

In a free society, of course, individuals can use anything they want as a “medium of exchange” (as long as no force or fraud is involved). But given the history of the world, I think that the vast majority of folks would settle on gold as the basis for their money.

And any “hypothetical” critic who cites court opinions to bolster the ludicrous claim that fiat money is hokey-dokey needs a return ticket to reality. On a fundamental level, court precedents are of little use. Courts have issued innumerable rulings supporting statism and evading the Constitution itself as well as any valid principles that support our freedom. We don’t need to recount old rulings on slavery or self-protection to point this out. Recent ignoble and outrageous decisions on elections, vaccine mandates, masks, and all the rest prove the point that most judges don’t understand or, more likely, don’t want to uphold freedom and rights or the Constitution. They are more amenable to ruling on issues based on “convenience” or legal technicalities that bolster the position of statism and collectivism than they are on the proper purpose of government or our inalienable rights.

The Supreme Court, in particular, is more likely to fuck you and your rights than it is to expand the realm of liberty.

Anyway.

My “hypothetical” critic is left with the following options in his “argument”:

• Claim 1: The federal government can print fiat money because there is nothing restricting [prohibiting] it from doing so, even though it is not explicitly delegated that authority.

• Claim 2: The federal government can print fiat money because the Constitution explicitly gives it that power.

Well. Which is it? Since those two options are mutually exclusive, my interlocutor is left with a self-contradiction. In this case, both options are wrong. And his “argument” is rendered null and void.

Of course, the truth doesn’t matter to most people, at least not truth dealing with the “public” realm. These statists rarely admit to being wrong about anything, no matter how dire the consequences are that arise from their policies or how mountainous the stack of evidence is that proves they are full of shit.

That you can bank on.

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