The Constitutionality of Paper Money--the Verdict!

[Skeptic]

This issue came up arguing with the tax-protestor "Rouser2" in another thread, so instead of hijacking it, I am starting a new thread.

1). The states are not allowed to "make anything but gold and silver coin a tender in payment of debts". The very nature of this sentence makes clear that there IS, or at least could be, such a thing as legal tender--that is, money--which is NOT made of gold and silver; e.g., paper money, or money coined from non-precious metals; otherwise, there would be no point to the prohibition.

2). What is the point of this prohibition? Consider the rest of the things states are not allowed to do: They are not allowed, for instance, to "enter into any treaty, alliance, or confederation"; nor are they allowed to "keep troops, or ships of war in time of peace"; nor are they allowed to "engage in war" (unless actually invaded). Does this mean that states, which are "not allowed to keep ships at time of peace" means that a (federal) navy vessel may not be kept on a state's coast? Of course not. Does this mean that if the federal government enters into a trade treaty with Zimbabwe, or declares war on Easter Island, the states must not recognize that treaty or war? Of course not.

If your interpretation of this section was correct and the "real point" of this prohibition was to give the states a way to "resist" federal paper money by refusing to recognize it, then by analogy the "real point" of the prohibition of raising a navy is to give the states a way to "resist" the creation of a federal navy, the "real point" of the prohibition on foreign treaties is to give the states a way to "resist" the federal government making treaties with other countries, etc. In other word, the "real point" of the section of the constitution that seems to limit the states' power on certain issues would be to make the states all-powerful on those issues! That might makes sense in the crossed-eyed tax-protestor "pay-triot" reading of the condtitution, but not anywhere else.

3). The real point of all these prohibitions, of course, is precsiely the OPPOSITE of what the Tax Protestor idiots claim. The states are not allowed to declare war, harbor a navy, or recognize paper money as legal tender INDEPENDENTALLY of the federal government; it does not mean they can refuse to recognize a war, or a navy, or paper currency that the federal government does create. On the contrary: a state must recognize federal paper currency as legal tender for the same reason it must recognize the federal navy or the federal speed limit: all three were created by a FEDERAL LAW, and federal laws must be obeyed by the states.

4). The only remaining issue is whether the federal government does, in fact, have the power to create paper money by law, in the same way it has the power to raise a navy or declare war. While the constitution does not expressly PERMIT congress to create paper money, it does not expressly FORBID it, either. The issue is whether the constitution forbids anything it doesn't expressly permits, or whether it permits anything it doesn't expressly forbids. Contrary to what you seem to think, the founders were by no means settled on this issue, and many of them were, in general, in favor of allowing Congress to do things not expressly forbidden, and, in particular, in favor of allowing Congress to print paper money. For an excellent discussion of this issue, see:

http://www.geocities.com/CapitolHil.../flaherty3.html

While you quoted one of the founders who was opposed to paper money, in fact many of the founders were FOR paper money, or at the very least, opposed to prohibiting congress from establishing it. The federal government issues paper money since 1812, and never, EVER, had any such law been declared unconstitutional. I suppose you think this means that the eeeeeevil gubirmint konspiracy to "pervert" the "true intention" of the constitution started in 1812 at the latest, and with those "corrupt" founders that didn't know what the constitution "really meant" and spoke in favor of the view that it allows paper money as early as 1787.

[epepke]

Um, Walt Disney World prints paper money. So does a local bar, Poor Paul's Pourhouse. The question is who will recognize it as legal tender.

[Luke T.]

Originally posted by epepke
Um, Walt Disney World prints paper money. So does a local bar, Poor Paul's Pourhouse. The question is who will recognize it as legal tender.

And grocery stores print coupons. I believe some, if not all, say "not legal tender," or words to that effect, on them. I'll have to check.

I remember they used to say you could cash them in for real money at the value of one-tenth of a penny when I was a kid. I don't know if they still do.

[epepke]

Originally posted by Luke T.
I remember they used to say you could cash them in for real money at the value of one-tenth of a penny when I was a kid. I don't know if they still do.

The last time I saw this, it was 1/100 of a cent. Inflation, you know.

But I don't think they still do.

Money is a bit of a game, anyway. If the Earth went through some ray or something and everyone woke up thinking that hamburger dill slices were immensely valuable, everyone would have stinky wet trousers.

[RandFan]

Originally posted by Luke T.
I remember they used to say you could cash them in for real money at the value of one-tenth of a penny when I was a kid. I don't know if they still do. My friends and I had a plan to go door to door collecting coupons to turn in for cash. After a couple of hours and some rudimentary math we decided it wasn't worth the effort.

That is when we noticed adds in the paper that said "free clean fill dirt" and other adds that said "wanted: clean fill dirt".

That one didn't fly either.

[The Fool]

Originally posted by RandFan
My friends and I had a plan to go door to door collecting coupons to turn in for cash. After a couple of hours and some rudimentary math we decided it wasn't worth the effort.

That is when we noticed adds in the paper that said "free clean fill dirt" and other adds that said "wanted: clean fill dirt".

That one didn't fly either.

I have memories from vietnam of the local paper money being that poorly made that it rotted in the damp humidity, due to the economy it was essentially worthless and literally was used for the old cliche of wipeing your a#se with money...US dollars were the only paper money anyone trusted...

Paper money is always just a promise. A promise that it will get you a certain amount of goods and services...Paper money could be blowing down the mainstreet and it would not be worth bending over to pick it up if the issuing government goes down the tubes.. I wonder how much money with saddams face on it is worth compared to money with a US president on it?

[Cecil]

Originally posted by The Fool
Paper money is always just a promise. A promise that it will get you a certain amount of goods and services...Paper money could be blowing down the mainstreet and it would not be worth bending over to pick it up if the issuing government goes down the tubes.. I wonder how much money with saddams face on it is worth compared to money with a US president on it? This reminds me of stories I've heard about the hyperinflation in Post-WWI Germany. Reparation payments were imposed to the tune of tens of billions of (1920) dollars after the war. Germany couldn't afford to make any after the first, so they started printing money. Now, if you know anything about basic economics, you know the overall price level is related to two things: The amount of money in the system and the "velocity", or how many times the money circulates around in a year.

As they pumped more and more money into the economy, inflation started spiralling out of control. Between 1919 and 1922, prices increased 14-fold. This started panic and people began to spend their money as soon as they got it. This increased the velocity of the money, and the price level began to soar in mid-1922. Between July 1922 and November 1923, the price level increased a staggering 7 billion-fold!

Workers were being paid 2 or 3 times a day so they could spend their pay before it became worthless. People started burning cash in their wood stoves because it was bulkier than the wood it could buy. Restaurants wouldn't print prices on the menu since the cost of your meal could quadruple between ordering it and paying for it. Stores stopped stocking food. A man who collected phone bills for a living found it was easier to stay at home and pay all the bills himself for a few cents at the end of the day. People's life savings were wiped out overnight. In the course of a year, the entire German national debt was reduced to pennies.

Just about the only winners were those who were in debt. Owners of real estate found their mortgages were eliminated, and they held clear title to the land.

The problem was eventually fixed by a new government that came in. They established a new currency called the Rentenmark, valued at one trillon old marks, and stopped printing money. The disaster righted itself overnight.

Maybe this is an argument against giving government unlimited authority to print money? I don't know, I just love this story. :D

[Rouser2]

Originally posted by Skeptic [/i]


>>This issue came up arguing with the tax-protestor "Rouser2" in another thread, so instead of hijacking it, I am starting a new thread.

The previous thread has nothing to do with "tax protesting" but of the premise that the Constitution is a dead letter, a prime example being, that the states do not obey ARt. I., Sec. 10 which mandates the states to make "no thing" but gold and silver coin a tender. That is the simple argument. All your copied polemics about the whys and wherefores of this or that are all irrelevant to that simple point which cannot be refuted. All else is hot air, or in your case, since you apparently cannot think for yourself, copied hot air.


-- Rouser

[Drooper]

But Skeptic,

You failed to discriminate between United States Notes and Federal Reserve notes, the two different types of legal tender in the US.
;)

[Chaos]

Originally posted by Cecil
This reminds me of stories I've heard about the hyperinflation in Post-WWI Germany. Reparation payments were imposed to the tune of tens of billions of (1920) dollars after the war. Germany couldn't afford to make any after the first, so they started printing money. Now, if you know anything about basic economics, you know the overall price level is related to two things: The amount of money in the system and the "velocity", or how many times the money circulates around in a year.

As they pumped more and more money into the economy, inflation started spiralling out of control. Between 1919 and 1922, prices increased 14-fold. This started panic and people began to spend their money as soon as they got it. This increased the velocity of the money, and the price level began to soar in mid-1922. Between July 1922 and November 1923, the price level increased a staggering 7 billion-fold!

Workers were being paid 2 or 3 times a day so they could spend their pay before it became worthless. People started burning cash in their wood stoves because it was bulkier than the wood it could buy. Restaurants wouldn't print prices on the menu since the cost of your meal could quadruple between ordering it and paying for it. Stores stopped stocking food. A man who collected phone bills for a living found it was easier to stay at home and pay all the bills himself for a few cents at the end of the day. People's life savings were wiped out overnight. In the course of a year, the entire German national debt was reduced to pennies.

Just about the only winners were those who were in debt. Owners of real estate found their mortgages were eliminated, and they held clear title to the land.

The problem was eventually fixed by a new government that came in. They established a new currency called the Rentenmark, valued at one trillon old marks, and stopped printing money. The disaster righted itself overnight.

Maybe this is an argument against giving government unlimited authority to print money? I don't know, I just love this story. :D

The story is true. When my grandmother´s household was dissolved, we inherited a stash of paper money from 1923 - notes of billions and trillions of Marks! There are still quite a lot of those notes in the hand of collectors, and every year on April Fool´s Day a few people try to cash them in at the Bundesbank...
I also inherited part of my grandfather´s stamp collection, including those of that era; it´s funny to see stamps of early ´23 or earlier with a new, late ´23 value stamped on them (cheaper than printing stamps with new values every few days). Or imagine a 50,000,000,000 Mark stamp, which was just enough to send a postcard...

A similar, but not quite as drastic situation arose after WW2; back then, people basically stopped using money and resorted to a barter economy. From what I heard, the "gold standard" of the time was cigarettes.

[Rouser2]

Originally posted by Cecil [/i]


>>The problem was eventually fixed by a new government that came in. They established a new currency called the Rentenmark, valued at one trillon old marks, and stopped printing money. The disaster righted itself overnight.
Maybe this is an argument against giving government unlimited authority to print money? I don't know, I just love this story.


Hyper inflation isn't the only possible adverse consequence of paper "money". Here's another. It was just about ten or fifteen years ago that an Ad ran in the local (American) newspaper promoting a sale by the Bundesbank of Third Reich bonds. Thus, the paper money backed bonds issued used to finance Hitller's reign of terror, were still being traded even in America. The very enemies of Hitler, through the magic of unfunded credit via the "paper" route, continue to finance Hitler's War machine a half century after the fact. No wonder governments, especially those engaging in war, so love paper "money."


-- Rouser

[Tricky]

I recall from my youth that a certain percentage of US bills had "Silver Certificate" across the top, rather than "Federal Reserve Note". I was told (though I don't know if it is true) that this meant the bills could always be exchaged for specie on demand. However, because they were fairly rare, the Silver Certificate bills themselves were more valuable to numismatists than their value as coin exchange tokens.

[Skeptic]

to make "no thing" but gold and silver coin a tender.

Indeed so, and they DON'T make anything tender: they don't print their own paper money, nor do they make conch shells, salt, cigarettes, or anything else legal tender. But they do RECOGNIZE federal notes as legal tender--becuase they must obey federal laws, including the one establishing the federal reserve and making federal reserve notes legal tender.

It's the same situation as with the navy or treaties: the states may not MAKE their own navy, but they must RECOGNIZE as legitimate the federal navy of the US. The states do not MAKE their own treaties with foreign nations, but they must RECOGNIZE treaties made by the federal government.

To put it even in simpler terms, it's the same situation as with the cashier in your local McDonald's had no authority to MAKE anything legal tender. He cannot declare that a piece of paper he drew the number "1000" on is a 1000-dollar bill. But he must RECOGNIZE federal reserve notes as payment from a customer.

It's that simple, really.

[Skeptic]

The very enemies of Hitler, through the magic of unfunded credit via the "paper" route, continue to finance Hitler's War machine a half century after the fact.

How did this "finance" an entity (nazi Germany) or a "war machine" that no longer exists? Was the payment sent back in time to 1943?

P.S.

First the tax protestor idiots argue that the income tax is "theft", then they argue that paper money is "worthless". Well, I've got a solution: pay your income tax with "worthless" paper money! If all the IRS is "stealing" from you is those "worthless" pieces of paper, why all the fuss?

[Chaos]

Originally posted by Rouser2
Originally posted by Cecil [/i]


>>The problem was eventually fixed by a new government that came in. They established a new currency called the Rentenmark, valued at one trillon old marks, and stopped printing money. The disaster righted itself overnight.
Maybe this is an argument against giving government unlimited authority to print money? I don't know, I just love this story.


Hyper inflation isn't the only possible adverse consequence of paper "money". Here's another. It was just about ten or fifteen years ago that an Ad ran in the local (American) newspaper promoting a sale by the Bundesbank of Third Reich bonds. Thus, the paper money backed bonds issued used to finance Hitller's reign of terror, were still being traded even in America. The very enemies of Hitler, through the magic of unfunded credit via the "paper" route, continue to finance Hitler's War machine a half century after the fact. No wonder governments, especially those engaging in war, so love paper "money."


-- Rouser

That argument is bogus. The bonds were used to finance Hitler´s war machine when the German government sold them. Now they are just used to earn money for the people who own them.

In the 1890´s, Imperial Germany put a "sparkling wine tax" into effec to finance the Navy build-up. The German Navy has been sunk completely twice since then, and not a single cent of this tax is used for the military. Would you still argue that anyone who buys champagne in Germany today is aiding the military aggression of Emperor William II?

[Valmorian]

Originally posted by epepke

If the Earth went through some ray or something and everyone woke up thinking that hamburger dill slices were immensely valuable, everyone would have stinky wet trousers.

Coolest movie premise ever! :O

"The Night the Dills became the Bills!"

[Rouser2]

Originally posted by Skeptic [/i]


>>But they do RECOGNIZE federal notes as legal tender--becuase they must obey federal laws, including the one establishing the federal reserve and making federal reserve notes legal tender.


Federal law is not the supreme law. The Supreme law is the Constitution. There is nothing clearer than the prohbition upon the states to make any thing but gold and silver coin a tender. If Fed notes were redeemable for gold or silver coin, you'd have an argument. Today, they are not redeemable, and thus, you and your alter ego, the hapless professor Flaherty, are hopelessly lost in the mind twisting vortex of Orwellian doublethink.


-- Rouser

[Skeptic]

you and your alter ego, the hapless professor Flaherty, are hopelessly lost in the mind twisting vortex of Orwellian doublethink.

Ah, so THAT'S what that strange feeling is. I thought I had a cold...

[Mycroft]

Originally posted by Rouser2
Federal law is not the supreme law. The Supreme law is the Constitution. There is nothing clearer than the prohbition upon the states to make any thing but gold and silver coin a tender. If Fed notes were redeemable for gold or silver coin, you'd have an argument. Today, they are not redeemable, and thus, you and your alter ego, the hapless professor Flaherty, are hopelessly lost in the mind twisting vortex of Orwellian doublethink.


Oh, this is silly. The states don't "make" money, the Federal Government does.

I never got this fixation some people have with legal tender versus gold or silver. No matter which you use, it's still an arbitrary measure of wealth. The only real difference between a printed dollar bill and its equivalent in silver or gold (or zinc or popsicle sticks) is that the dollar bill is easier to counterfeit. The value of the unit of exchange is still determined by the relationship between the available supply of that unit (money) and the overall wealth available for exchange in the economy.

[phildonnia]

1. The purpose of the original constitutional prohibition was to get rid of the multiplicity of different currencies. This was a big barrier to trade; gold and silver essentially became the "euro" of North America.

2. The phrase "legal tender" just means that it is the default currency in contracts that do not state otherwise. If you agree to buy my car with grocery coupons, and then try to give me greenbacks, I am not obliged to accept them, "legal" or not. On the other hand, if you agree to buy my car without specifying the mode of payment, then I am not obligated to accept airline miles as payment, nor are you obligated to pay in toilet paper if I should demand it.

[Rouser2]

Originally posted by Mycroft [/i]


>>Oh, this is silly. The states don't "make" money, the Federal Government does.

You may think it "silly", but throughout history all those who have been conned out of their substance via monetary mischief are not amused. Nor were the Founders who saw the nation suffer under the perncious effects of paper "money". And that is precisely why there is that specific separation of monetary power imposed -- only the Congress has the power to coin money but the states make sure it is honest, by making not "thing" but gold and silver a tender. The two clauses do not conflict; they are meant to be complimentary -- the one reinforcing the other.


>>I never got this fixation some people have with legal tender versus gold or silver. No matter which you use, it's still an arbitrary measure of wealth. The only real difference between a printed dollar bill and its equivalent in silver or gold (or zinc or popsicle sticks) is that the dollar bill is easier to counterfeit.

Sounds to me like Paul Sameulson Econ 101 brainwash. There is indeed a very important difference, besides the fact that gold and silver coin are in fact impossible to counterfeit -- gold and sillver coin have intrinsic value -- paper does not.

-- Rouser

[Drooper]

Rouser,

Sounds like you need a little Econ 101 revision.

You talk a load of tosh, from an economic point of view.

The notes and currency on issue, be the Federal Reserve or United State Notes (there is a distinction) are all obligations of the US Government (note that Federal Reserve Notes are additionally liabilities of the Federal Reserve Banks).

As obligations of the US Government, they are as safe, financially, as the US Federal Government. Now here is the catch. the Federal government is Constitutionally permitted to levy taxes on the entirety of national income. So the money base (i.e. the paper money and coinage) is as safe ultimately backed by the income generating potential of the entire US economy. That is far safer than being backed by an arbitrary commodity that might happened to be limited in supply.

============================================


And phildonnia.

You are correct about the fact that payment for goods or services may be demanded, or paid in any preagreed format. However, You may never refuse a repayment of debt in the form of legal tender. That stops some potentially nasty practices by unscrupulous organisations.

[Mycroft]

Originally posted by Rouser2

You may think it "silly", but throughout history all those who have been conned out of their substance via monetary mischief are not amused. Nor were the Founders who saw the nation suffer under the perncious effects of paper "money". And that is precisely why there is that specific separation of monetary power imposed -- only the Congress has the power to coin money but the states make sure it is honest, by making not "thing" but gold and silver a tender. The two clauses do not conflict; they are meant to be complimentary -- the one reinforcing the other.

Monetary mischief, huh? Pernicious effects? Perhaps you could elaborate on those?


Originally posted by Rouser2

Sounds to me like Paul Sameulson Econ 101 brainwash. There is indeed a very important difference, besides the fact that gold and silver coin are in fact impossible to counterfeit -- gold and sillver coin have intrinsic value -- paper does not.

-- Rouser

The problem with your theory is that there is nothing at all intrinsic about the value of gold or silver. Oh, it’s pretty and has some industrial uses, but you can’t eat it. You can wear it, but it doesn’t provide for warmth. Its only real value, just like paper money, lay in your ability to trade it for the things you really do need. If all those pretty coins hidden away in safe deposit boxes were pulled out and put into circulation, you would see their value in relation to paper money drop just like any other commodity.

[Rouser2]

Originally posted by Mycroft [/i]

>>Monetary mischief, huh? Pernicious effects? Perhaps you could elaborate on those?


Are you totally clueless? Or merely a victim of public education?

>>The problem with your theory is that there is nothing at all intrinsic about the value of gold or silver. Oh, it’s pretty and has some industrial uses, but you can’t eat it. You can wear it, but it doesn’t provide for warmth.

The real value of a commodity does not lie in merely whether it may be eaten or worn as clothing. The valuable uses of both gold and silver, excluding monetary uses, are legion.


>>Its only real value, just like paper money, lay in your ability to trade it for the things you really do need. If all those pretty coins hidden away in safe deposit boxes were pulled out and put into circulation, you would see their value in relation to paper money drop just like any other commodity.


If all those pretty gold and silver coins were put into circulation, it would be because the nation's paper currency had become worthless even as a medium of exchange. And this has happened time and again throughout history. In fact, there isn't a single case of a paper currency that has ever held its value over any significant period of time, in all of recorded human history. Not so with gold. So, I take it you did attend a government school???


-- Rouser

[Rouser2]

Originally posted by Drooper [/i]


>>Rouser,

>>Sounds like you need a little Econ 101 revision.

When the student is ready, the teacher appears.

>>You talk a load of tosh, from an economic point of view.
The notes and currency on issue, be the Federal Reserve or United State Notes (there is a distinction) are all obligations of the US Government (note that Federal Reserve Notes are additionally liabilities of the Federal Reserve Banks).


No, I'm afraid you've got it quite twisted. Federal Reserve Notes are created by banks when they are borrowed into existence by a borrower. At one time Fed Notes were redeemable for lawful money (gold or silver coin) but today such "notes" are simply units of nothing, created from out of nothing, which promise to pay nothing, but created as instruments of debt. They are not obligations of the bank, but obligations of the borrower to pay back to the bank with the addition of added interest.


-- Rouser

[Chaos]

[QUOTE]Originally posted by Rouser2
Originally posted by Mycroft [/i]
The valuable uses of both gold and silver, outside excluding monetary uses, are legion.


Mmmh... "valuable" uses for gold and silver...

- crowns for teeth
- ornaments
- jewelry

Nothing world-moving if you ask me.

The only value of precious metals (outside VERY recent technical applications) is that they look reasonably pretty and are soft enough to be shaped quite easily - though too soft to be of practical use.

[Skeptic]

Nor were the Founders who saw the nation suffer under the perncious effects of paper "money".

But the founders, as the link I showed you notes, refused to ban the making of paper money by the federal government. They only banned the states from making it. The founders simply didn't believe what you seem to believe they believed about paper money.

The two clauses do not conflict; they are meant to be complimentary -- the one reinforcing the other.

As shown above, this is simply wrong.

If the point of the prohibition was to not let the federal government make paper money, the founders could have simply forbidden the federal government, directly, to print paper money, in the same way it is forbidden to (say) make laws establishing religion. They didn't. And in any case, if that was their purpose, they would have forbidden the states to ACCEPT anything but gold and silver as legal tender, not forbidden them to MAKE anything but gold and silver legal tender. These are two completely different things. All the prohibition does is prohibit the states from issuing their own paper money. It says nothing at all about what kind of money the federal government can or cannot make.

Sounds to me like Paul Sameulson Econ 101 brainwash.

A brainwash you avoided by never taking Econ 101, or, for that matter, learning anything about Economics.

P.S.

Gold is NOT intrinsically valuable. Take Econ 101 and learn why.

[Skeptic]

The valuable uses of both gold and silver, excluding monetary uses, are legion.

Such as... ?

[KonTiki]

Originally posted by Rouser2
In fact, there isn't a single case of a paper currency that has ever held its value over any significant period of time, in all of recorded human history. Not so with gold. So, I take it you did attend a government school???

-- Rouser [/B]
Gold coinage can and has been debased throughout history when the issuing government mixed in base metal. The Roman Empire immediately comes to mind.

[69dodge]

Originally posted by Rouser2
There is indeed a very important difference, besides the fact that gold and silver coin are in fact impossible to counterfeit -- gold and sillver coin have intrinsic value -- paper does not.Nothing has intrinsic value. A thing has value if people want it.

You want gold? Buy gold. No one is stopping you.

But what would you do with it once you have it?

[Mycroft]

Originally posted by Rouser2

>>Monetary mischief, huh? Pernicious effects? Perhaps you could elaborate on those?


Are you totally clueless? Or merely a victim of public education?

We could make this an exchange of insults instead of a discussion. What sort of “education” are you a victim of?

Originally posted by Rouser2
The real value of a commodity does not lie in merely whether it may be eaten or worn as clothing. The valuable uses of both gold and silver, excluding monetary uses, are legion.


There are many uses for gold and silver, but there are also many uses for tin, zinc and aluminum. What makes one more valuable than the other is not the uses that can be found for it but its availability in relation to the demand.

For example, did you know that aluminum was once considered to be a precious metal with a value greater than gold or platinum? It’s hard to imagine in today’s world where we throw away soft-drink cans made of the stuff that there was a time when it was fashioned into fine jewelry and sold for more than $1200 a kilogram, but it’s true:

http://inventors.about.com/library/inventors/blaluminum.htm

Originally posted by Rouser2
If all those pretty gold and silver coins were put into circulation, it would be because the nation's paper currency had become worthless even as a medium of exchange. And this has happened time and again throughout history. In fact, there isn't a single case of a paper currency that has ever held its value over any significant period of time, in all of recorded human history. Not so with gold. So, I take it you did attend a government school???

In the event of a catastrophic collapse in the world economy that made paper money worthless, then the value of gold and silver would still be determined by its availability in relation to the goods it could be traded for. If food were scarce and the supply uncertain, why would someone trade it for gold?

[Rouser2]

Originally posted by Chaos [/i]


>>Mmmh... "valuable" uses for gold and silver...

- crowns for teeth
- ornaments
- jewelry

>>Nothing world-moving if you ask me.

ELECTRONICS AND TELECOMMUNICATIONS
LASERS AND OPTICS
MEDICINE AND HEALTH
INDUSTRY AND AVIATION
DENTISTRY
EYE SURGERY
LASERS

AIRBAGS
AIRCRAFT ENGINES
AIRCRAFT WINDOWS
ENGINE SYSTEMS


COMPUTERS/SEMICONDUCTORS
POWERCHAIRS
SPACECRAFT
TELEPHONES
TELEPHONE WALL JACKS
TVs AND VCRs
COMPUTERS/SEMICONDUCTORS

DENTISTRY
EYE SURGERY
LASERS


Nah, nothing earth shaking.


-- Rouser

[Rouser2]

Originally posted by Skeptic [/i]


>>But the founders, as the link I showed you notes, refused to ban the making of paper money by the federal government. They only banned the states from making it. The founders simply didn't believe what you seem to believe they believed about paper money.


Constitutional Law 101: The only powers allowed the Federal Government are those specifically delegated to it. There is no power to print paper money, but only the power to coin money. The proposed clause to allow the congress to "emit bills of credit" was debated and defeated. The states are not banned merely from "making" paper money; the states are prohibited from making or coining any money at all. All you really need to know about the poor, hapless professor you keep refering to, is the disclaimer at the end where he confesses he is not an expert on the Constitution. That's about the only truthful thing in the entire tract. Indeed, when referring to Madision's notes on the Constitutional debates, the very passages he cites affirm the Founders intention to prohibit paper money.


But here is one who IS an expert on the Constitution and the monetery clauses contained therein. The noted 19th century historian George Bancroft who also happened to be an acquantance of many of the Founding Fathers. Summarizing the issue Bancroft wrote:

"James Madision left his testimony that the pretext for a paper currency was cut off, and particularly for making bills a tender... this is the interpretation of the clause, made at the time of its adoption, alike by its authors and its opponents, accepted by all the statesman of that age, not open to dispute because too clear for argument, and never disputed so long as any one man who took part in framing the constitution remained alive."

--"History of the United States, Vol VI" by George Bancroft,
-- Rouser

[Rouser2]

Originally posted by 69dodge [/i]


>>Nothing has intrinsic value. A thing has value if people want it.

Uhh, well that is the whole idea behind the concept of intrinsic value.

>>You want gold? Buy gold. No one is stopping you.

That's off point, junior. We're discussing the constitutionality of paper "money," not whether anyone wants to buy gold.

-- Rouser

[Rouser2]

Originally posted by Mycroft [/i]

>>In the event of a catastrophic collapse in the world economy that made paper money worthless, then the value of gold and silver would still be determined by its availability in relation to the goods it could be traded for.

I don't get just what that has to do with the constitutionality of paper money.



-- Rouser

[Rouser2]

Originally posted by KonTiki

Gold coinage can and has been debased throughout history when the issuing government mixed in base metal. The Roman Empire immediately comes to mind.

Not a valid point. The gold content never completely loses its purchasing power. Mixing alloys or clipping does not denigrate the gold therein.


-- Rouser

[Mycroft]

Originally posted by Rouser2
Originally posted by Mycroft [/i]

>>In the event of a catastrophic collapse in the world economy that made paper money worthless, then the value of gold and silver would still be determined by its availability in relation to the goods it could be traded for.

I don't get just what that has to do with the constitutionality of paper money.


No matter what medium of exchange you use, its value is ultimately backed by the goods and services available to purchase with it. Your assertion that gold has intrinsic value on its own is no more valid than the idea that paper money has intrinsic value.

When you start to question the value of paper money and the system in place that makes it available, you start to understand the difference between money and wealth. Money is not itself wealth, but we think of it as the same because it can be directly exchanged for the things that are wealth. The money we have is a measure of the wealth we have access to.

Your logical error is in substituting precious metal for paper money in your own mental construct of wealth, but this mental substitution is just another illusion. Precious metal has value for exactly the same reasons that paper money does, because as a society we have agreed to give it value, agreed that you should be able to trade it for wealth, because there is a tradition that supports this that is older than paper money, and because the weight and feel of gold and silver is emotionally satisfying to our concept of value.

[epepke]

Originally posted by Cecil
This reminds me of stories I've heard about the hyperinflation in Post-WWI Germany.

My grandparents lived through this. It was one of the reasons they emigrated to the United States. All you say jibes with what they said about it.

[69dodge]

Originally posted by Rouser2
We're discussing the constitutionality of paper "money," not whether anyone wants to buy gold.Ok. It seemed you were arguing about more than just constitutionality. For example, what does your list of earth-shaking uses of gold have to do with the constitutionality of paper money?

I don't actually know what "constitutional" means. In a practical sense, I guess, it means whatever the latest court decisions say it means. But, of course, that immediately raises the question, how do the courts reach their decisions? One would hope that they don't do it entirely arbitrarily, but on the other hand, they don't always seem to do it by asking themselves, "what would the authors of the Constitution say?".

Can any lawyers comment?

[Rouser2]

Originally posted by Mycroft [/i]

>>No matter what medium of exchange you use, its value is ultimately backed by the goods and services available to purchase with it. Your assertion that gold has intrinsic value on its own is no more valid than the idea that paper money has intrinsic value.

An absurd statement. Gold does have intrinsic value; paper does not. But again, these are economic, not constitutional arguments.

>> Money is not itself wealth, but we think of it as the same because it can be directly exchanged for the things that are wealth. The money we have is a measure of the wealth we have access to.


If it is real money; it is indeed weath. Real money has intrinsic value; money substitutes such as paper do not.


>>Your logical error is in substituting precious metal for paper money in your own mental construct of wealth, but this mental substitution is just another illusion. Precious metal has value for exactly the same reasons that paper money does, because as a society we have agreed to give it value

More nonsense. Gold does not have value because we have "agreed" to give it value. It has value unto itself.

-- Rouser

[Rouser2]

Originally posted by 69dodge [/i]


>>I don't actually know what "constitutional" means. In a practical sense, I guess, it means whatever the latest court decisions say it means. But, of course, that immediately raises the question, how do the courts reach their decisions? One would hope that they don't do it entirely arbitrarily, but on the other hand, they don't always seem to do it by asking themselves, "what would the authors of the Constitution say?".
Can any lawyers comment?

Our Constitution was not just written for lawyers and supreme court judges; it was written for the people. To defer all questions to Supreme Court interpretations is to surrender our birthright and any notion of citizenship. The Supreme Court can rule any way it chooses on any subject; but the Supreme Law remains as written, and when that law is clear, as it certainly is crystal clear on the money issue, then it is not subject to "interpretation."


-- Rouser

[Ziggurat]

Originally posted by Rouser2
An absurd statement. Gold does have intrinsic value; paper does not. But again, these are economic, not constitutional arguments.


And you're wrong on those arguments, just as you are on the constitutional ones. Gold's value has been rather arbitrary throughout history. Its usefulness as a monetary unit comes more from its scarcity than its usefulness (and it DOES drop in price when the supply increases) - it has very few important industrial applications, it's mainly for jewelry, but any idiot should be able to figure out that the value of jewelry can spin on a dime. But I guess you're not any idiot, you're a special class of idiot. Gold costs will plummet if large deposits are found and mined, and they will skyrocket if someone corners the supply. Perhaps you're unaware of what DeBeers has managed to do to the price of diamonds, what should be simply a semi-precious stone, by their tight control of the market (hint: diamond production rates exceed diamond consumption rates, and have for many decades).


If it is real money; it is indeed weath. Real money has intrinsic value; money substitutes such as paper do not.


That has only ever been true in a barter economy, but then that's not really "money".


More nonsense. Gold does not have value because we have "agreed" to give it value. It has value unto itself.


And yet you can't explain what that value is. Gold has very little value in itself. The value we assign it has everything to do with the scarcity of it, and opinions about it's possible value to other people. That's why gold prices fluctuate. If gold was as common as copper, it woud also be cheap.

Resorting to a gold standard has potentially disastrous consequences for the ecomony. For one thing, it provides an artificial incentive to spend lots of resources (like oil, which DOES have real value) extracting it merely because it is money, not because it is useful. That becomes a drain on the economy, and just like the tulip craze, where vast farming resources were wasted on growing a useless product because people thought of it as money, it'll come back to kick us in the rear. Not to mention that letting your monetary policy be dictated by the scarcity of a substance whose supply you can't control is the height of stupdity. Imagine if a corporation developed the kind of stranglehold on the gold supply that DeBeers has on diamonds?

[Skeptic]

ELECTRONICS AND TELECOMMUNICATIONS
LASERS AND OPTICS
MEDICINE AND HEALTH
INDUSTRY AND AVIATION
DENTISTRY
EYE SURGERY
LASERS

AIRBAGS
AIRCRAFT ENGINES
AIRCRAFT WINDOWS
ENGINE SYSTEMS


COMPUTERS/SEMICONDUCTORS
POWERCHAIRS
SPACECRAFT
TELEPHONES
TELEPHONE WALL JACKS
TVs AND VCRs
COMPUTERS/SEMICONDUCTORS

Oh, I see.

So gold was valuable in ancient Sumeria, the European middle ages, and 1780s United States because they all appreciated its intrinsic value in building lasers, aircrafts, spaceships, and VCRs.

And, if the economy collapses due to the evil of paper money and the world goes back to batter economy, the first thing everybody would want to hoard would be the material necessary to make telephone wall jacks and powerchairs.

Good to have that cleared up.

[crackmonkey]

If you think gold's value is predicated on its utility, why aren't steel and aluminum precious metals?
This line of argument is pretty thin...

[69dodge]

Originally posted by Rouser2
Gold does not have value because we have "agreed" to give it value. It has value unto itself.Suppose you knew that no one would agree to give you more than fifty dollars for a pound of gold, because, for example, we discovered how to turn lead into gold and that's how much the process cost. In that situation, would you rather have a pound of gold or a hundred dollar bill?

[epepke]

Originally posted by crackmonkey
If you think gold's value is predicated on its utility, why aren't steel and aluminum precious metals?
This line of argument is pretty thin...

Not to support the argument that gold's value is based on utility, but...

Aluminim used to be extremely precious. One of the czars had a baby rattle made of pure gold with something special--a thin cap made of pure aluminum.

Then the electrical process for refining aluminum got invented, and it became about as cheap as bauxite.

Except in Britain, where it's called "aluminium." Apparently, that extra "i" costs an awful lot, because you have to pay a couple of pounds for just a few square meters of aluminium foil.

[Evolver]

Yes, your paper money is unconstitutional, and therefore worthless. You must get rid of it now. In fact, if you send it all to me, I'll make sure it's disposed of properly.

It's the least I can do for all my friends here at the JREF forum.

[jake]

Originally posted by crackmonkey
If you think gold's value is predicated on its utility, why aren't steel and aluminum precious metals?
This line of argument is pretty thin...
Many metals like copper are on the upswing due the collapse of the fiat dollar but they aren't "precious" because they are not as rare as gold and silver. Precious metals have an intrinsic monetery value due to their scarcity. People need a safe store of wealth and it isn't available anywhere else. They could store 50 tons of steel in their backyard but that wouldn't be as practical as a little bit of gold and silver bullion. Gold and silver are tax resistant and lawyer resistant. This makes it a perfect store of wealth for freedom loving people. Freedom from the fiat regime.


http://www.freedomdomain.com/bankquot.html

http://www.geocities.com/northstarzone/FED.html

[Skeptic]

Many metals like copper are on the upswing due the collapse of the fiat dollar

(shrug)

Gold reached a high of almost $700 an ounce in 1980. It then quickly declined, settling at around $350-400 an ounce two years later. It remained at that price level until 1994, when a further five-year decline dropped the price lower still, to $260 an ounce ca. 1998.

It is not at all surprising that, when gold reached this bargain-basement price of $260 an ounce, a twenty-year low not unheard of since the 1970s (and that's in 1970s dollars!), people started buying gold for investment. This slowly drove the prices up, until now, five years later, it's back at its historical (1980s-early 90s level of ca. $420 an ounce.

Why this perfectly reasonable reaction is any proof of the "colapse of the fiat dollar", which seems to be doing rather well, thank you, is beyound me.

P.S.

Edited to add: never mind. I Just checked out "Jake"'s links. He's one of those morons who believes the "Federal Reserve is a private company owned by a bunch of greedy jewish bankers" conspiracy theory. So much for having any reasonable discussion with this guy.

"Jake" appears to be a new poster here, as well. I haven't checked, but I'll bet "Rouser2" is calling for reinforcements on the wacky conspiracy theory bulletin boards he frequents, to help him "show the truth to the brainwashed fools on www.randi.org", or something similar.

P.P.S.

Hey, jake and Rouser: if you find yourself in possession of any of those worthless, fake, jewish-owned, evil federal reserve notes--don't be shy, send them to me! I promise to dispose of them in a constitutionally-sanctioned manner!

(You got to wonder why none of the "federal reserve notes are worthless" idiots puts his "fake" money where his mouth is, don't you?)

[jake]

This is not the first time I've witnessed someone playing the race card to support the fiat "Federal" private reserve system..

The dollar has declined about 40% in relation to the euro recently, not my idea of "doing rather well".

Gold and silver have been suppressed by short selling and leasing. Now that knowledge of this manipulation is becoming widespread thanks to the internet, prices are going to skyrocket as everyone with any sense dumps their green toilet paper and the shorts scramble to cover. Fiat may buy you a burger and a six pack today, but next month it may only be good for a wipe or two.

[Skeptic]

Gold and silver have been suppressed by short selling and leasing.

No, they haven't, you idiot. That's just a conspiracy theory you invented out of thin air to explain why the 15-year steady decline in gold prices is somehow an "illusion", while the 5-year rise in its prices is somehow "the truth".

Now that knowledge of this manipulation is becoming widespread thanks to the internet,

TRANSLATION: kooks who couldn't get their paranoid rants published anywhere, now put them on free web site hosts like the ones in Jake's .sig file. Of course, that's a bit like saying that "knowledge of the earth's flatness is becoming widespread thanks to the internet" because the flat earth society (http://www.flat-earth.org/) has a nifty-looking web site.

as everyone with any sense dumps their green toilet paper and the shorts scramble to cover.

I already TOLD ya, Jake: if you have any of that "green toilet paper" encoumbering your wallet, send it to me! I promise not complain!

[michaellee]

Is this Economics 101?....sorry, wrong class. This must be Esoterics 101.

[Chaos]

Originally posted by jake

The dollar has declined about 40% in relation to the euro recently, not my idea of "doing rather well".


Have I missed something? Last time I checked my wallet, the Euro is paper money, too.

So if the Dollar loses value compared to the Euro, it has nothing to do with any perceived weakness of paper money.

[Rouser2]

Originally posted by Ziggurat [/i]

>>>>
quote:
--------------------------------------------------------------------------------
Originally posted by Rouser2
An absurd statement. Gold does have intrinsic value; paper does not. But again, these are economic, not constitutional arguments.

--------------------------------------------------------------------------------

>>And you're wrong on those arguments, just as you are on the constitutional ones.

That gold has intrinsic value is not an argument; it is a fact. Your assertion that I am wrong on the constituional argument is just another empty assertion, unsupported by fact.


>> Gold's value has been rather arbitrary throughout history. Its usefulness as a monetary unit comes more from its scarcity than its usefulness (and it DOES drop in price when the supply increases)

So??? Everthing fluctutates in value. But gold never completely loses its value, unlike paper.

>> - it has very few important industrial applications,

It's applcations are legion, as previously noted.

>>it's mainly for jewelry, but any idiot should be able to figure out that the value of jewelry can spin on a dime. But I guess you're not any idiot, you're a special class of idiot.

But you're no special genius, just another ad hominem attacker devoid of valid argument.


>>Resorting to a gold standard has potentially disastrous consequences for the ecomony. For one thing, it provides an artificial incentive to spend lots of resources (like oil, which DOES have real value) extracting it merely because it is money, not because it is useful.

Economic history teaches that the benefits of mining gold more than compensate for the costs especially when compared to the costs inflicted on a society by the pernicious effects of paper money. But these are all economic, not constitutional arguments.

>> Not to mention that letting your monetary policy be dictated by the scarcity of a substance whose supply you can't control is the height of stupdity.

The alternative is to allow monetary police to be dictated by those who control the prinitng press. History teaches there is a natural balance of supply and demand in relation to the production of gold or any commodity. But none of your economic arguments can refute the fact that the supreme law of the land recognizes only gold and silver as a legal tender in payment of debts.


-- Rouser

[Rouser2]

Originally posted by crackmonkey [/i]

>>If you think gold's value is predicated on its utility, why aren't steel and aluminum precious metals?

Not merely utility but durability, divisibility, scarcity, etc., not merely intrinsic value alone.


-- Rouser

[Rouser2]

Originally posted by 69dodge
Suppose you knew that no one would agree to give you more than fifty dollars for a pound of gold, because, for example, we discovered how to turn lead into gold and that's how much the process cost. In that situation, would you rather have a pound of gold or a hundred dollar bill?


Alchemy doesn't work But if it ever does, it's hard to conceive of a commodity more subject to fraud than paper. I'll take the C note and pass it off to some unsuspecting dupe for silver or some such.


-- Rouser

[Rouser2]

Originally posted by Skeptic [/i]


>>Hey, jake and Rouser: if you find yourself in possession of any of those worthless, fake, jewish-owned, evil federal reserve notes--don't be shy, send them to me! I promise to dispose of them in a constitutionally-sanctioned manner!


"Skeptic" again shows his/her true colors as he/she sinks into the anti-semitic race baiting sewer.


-- Rouser

[Cecil]

Originally posted by Rouser2
Alchemy doesn't work Transmuting elements by purely chemical means doesn't work, true. Chemistry reactions all take place with the atoms at some distance from each other, with just the electron shells interacting. Since the makeup of the element is determined by the number of protons in the nucleus, this approach will never produce new elements.

However, by using huge particle accelerators or high temperatures, we can bring the nucleii of two atoms close enough that they combine to form one nucleus, and hence a different element. This is what happens in a hydrogen bomb, a fusion reactor, or the centre of the sun. Turning lead into gold via this process is not currently possible, but it is not in violation of any laws to do so.

[Chaos]

rouser2

Show us the intrinsic value gold has. If, as you say, this is a fact, it should not be difficult to show.

Show us the "legion" of uses for gold.

Don´t just repeat "It is so. It is so. It is so." over and over again.

People here can be won over with solid arguments. It is up to you to present them.

[Ziggurat]

Originally posted by Rouser2

That gold has intrinsic value is not an argument; it is a fact. Your assertion that I am wrong on the constituional argument is just another empty assertion, unsupported by fact.


Alluminum has more intrinsic value than gold. And yet it's worth much less. You can't seem to wrap your head around the idea of scarcity, can you?


So??? Everthing fluctutates in value. But gold never completely loses its value, unlike paper.


No, but it can do something even worse than lose value. It can cause deflation.


The alternative is to allow monetary police to be dictated by those who control the prinitng press.


And theirin lies the heart of your paranoia and conspiracy theories.


History teaches there is a natural balance of supply and demand in relation to the production of gold or any commodity.


"Natural balance" is a meaningless phrase in this context. There's a "natural balance" between the supply and demand of beanie babies, but that's got nothing to do with their suitability as a monetary tool.


But none of your economic arguments can refute the fact that the supreme law of the land recognizes only gold and silver as a legal tender in payment of debts.


And none of your paranoid ranting is going to change the fact that no serious legal scholars agree with you, the supreme court doesn't agree with you, Congress doesn't agree with you, and most importantly, the people of the United States themselves don't agree with you. Meaning even if you could magically convince everyone that the constitution says what you think it says, all that would happen is we would change the constitution to allow paper money. And that, really, is the ultimate argument for the irrelevance of your belief.

[jake]

It's amazing how insults and ridicule come out of the wood work when secrets are exposed.

http://www.geocities.com/northstarzone/FED.html

You really know you hit a raw nerve when tactics such as those on this thread are employed.

http://www.freedomdomain.com/bankquot.html

Do not click on the above links, you may be labeled "paranoid" or "conspiracy theorist".

By all means get rid of that evil anti-semitic gold, it might cause deflation. Send it to me.


BTW, silver reached $6.99 at one point this morning! Silver is not going up, fiat is going down.

[michaellee]

Originally posted by ZigguratNo, but it can do something even worse than lose value. It can cause deflation I agree as does U.S. economic history with a non-fiat currency resulting in periods of deflation(an increase in the purchasing power of the dollar). I would love to see evidence as to why deflation is "even worse" than gold losing value compared to the paper fiat "dollar".

[Luke T.]

Originally posted by Rouser2

Constitutional Law 101: The only powers allowed the Federal Government are those specifically delegated to it. There is no power to print paper money, but only the power to coin money. The proposed clause to allow the congress to "emit bills of credit" was debated and defeated. The states are not banned merely from "making" paper money; the states are prohibited from making or coining any money at all. All you really need to know about the poor, hapless professor you keep refering to, is the disclaimer at the end where he confesses he is not an expert on the Constitution. That's about the only truthful thing in the entire tract. Indeed, when referring to Madision's notes on the Constitutional debates, the very passages he cites affirm the Founders intention to prohibit paper money.

Bzzzzzz! Wrong answer!

James Madison, Federalist Paper #42:

All that need be remarked on the power to coin money, regulate the value thereof, and of foreign coin, is, that by providing for this last case, the Constitution has supplied a material omission in the articles of Confederation. The authority of the existing Congress is restrained to the regulation of coin STRUCK by their own authority, or that of the respective States. It must be seen at once that the proposed uniformity in the VALUE of the current coin might be destroyed by subjecting that of foreign coin to the different regulations of the different States. The punishment of counterfeiting the public securities, as well as the current coin, is submitted of course to that authority which is to secure the value of both. The regulation of weights and measures is transferred from the articles of Confederation, and is founded on like considerations with the preceding power of regulating coin.

And this shows your previous statment to have things completley backwards:

Rouser2:And that is precisely why there is that specific separation of monetary power imposed -- only the Congress has the power to coin money but the states make sure it is honest, by making not "thing" but gold and silver a tender.

[Luke T.]

When my son went through the Pokemon phase, some of the cards were worth a buck or two, and others were worth hundreds of dollars. Same cardboard, same ink; different characters and availability.

[Skeptic]

Forget the "Federal Reserve" web page... check out the homepage where it is hosted!

http://www.geocities.com/northstarzone/index.html#top

"Jake" apparently believe every single conspiracy theory in existence, from "planet X causes weather changes" to "milk is evil". "Jake" is even flakier than "Rouser2", as amazing as that may sound.

Incidentally, despite the fact that he claims federal money is "worthless" and that (in particular) the new $20 bills contrain tiny transmitters that allow the evil secret government to detect you, he is asking for donations:

http://www.geocities.com/northstarzone/DONATION.html

Do you think that if somebody sends him a new $20, he'll refuse it???

[phildonnia]

Originally posted by Drooper
...
And phildonnia.

You are correct about the fact that payment for goods or services may be demanded, or paid in any preagreed format. However, You may never refuse a repayment of debt in the form of legal tender. That stops some potentially nasty practices by unscrupulous organisations.

According to the treasury's web site at http://www.ustreas.gov/education/faq/currency/legal-tender.html#q1

... There is ... no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise...

[Rouser2]

Originally posted by Chaos [/i]

>>Show us the intrinsic value gold has. If, as you say, this is a fact, it should not be difficult to show.
Show us the "legion" of uses for gold.
Don´t just repeat "It is so. It is so. It is so." over and over again.
People here can be won over with solid arguments. It is up to you to present them.


And it is up to you to read them. This has already been covered in a previous post.

-- Rouser

[Rouser2]

Originally posted by Luke T. [/i]

>>

quote:
--------------------------------------------------------------------------------
All that need be remarked on the power to coin money, regulate the value thereof, and of foreign coin, is, that by providing for this last case, the Constitution has supplied a material omission in the articles of Confederation. The authority of the existing Congress is restrained to the regulation of coin STRUCK by their own authority, or that of the respective States. It must be seen at once that the proposed uniformity in the VALUE of the current coin might be destroyed by subjecting that of foreign coin to the different regulations of the different States. The punishment of counterfeiting the public securities, as well as the current coin, is submitted of course to that authority which is to secure the value of both. The regulation of weights and measures is transferred from the articles of Confederation, and is founded on like considerations with the preceding power of regulating coin.
--------------------------------------------------------------------------------

>>And this shows your previous statment to have things completley backwards:


Whew! Sure got me on that one!
But seriously,
just what statement would that be? That the states are making something other than gold and silver coin a tender... in contravention to Art. I, Sec. 10, which mandates that the states make only gold and silver coin a tender??? The paragraph you quote only discusses the regulation of the "value" of foreign coin to be within the powers of regulation of the congress and not the states, a power not delegated in the Articles of Confederation. There is nothing here allowing the congress to print paper money, nor for the states to make it a tender.


-- Rouser

[Rouser2]

Originally posted by Ziggurat [/i]


>>The alternative is to allow monetary police to be dictated by those who control the prinitng press.

--------------------------------------------------------------------------------


>>And theirin lies the heart of your paranoia and conspiracy theories.


And just what conspiracy theories would those be? Kindly point them out. I've never addressed any such thing. There is nothing secret nor conspiratorial about it.

-- Rouser

[Rouser2]

Originally posted by Ziggurat [/i]


>>And none of your paranoid ranting is going to change the fact that no serious legal scholars agree with you,

Paranoid ranting? All I've done is to quote the Constitution and point out the reality the non-observance of a supreme law. And you call that "ranting"??

>>the supreme court doesn't agree with you,

The Supreme Court didn't agree with the freeing of fugitive slaves either, but the fact is, the Supreme Court has never even directly ruled on the issue.

>>Congress doesn't agree with you,

Oh, many in the congress have never even heard of the issue, but there certainly are those in the Congress who have, and who do indeed agree with me.

>> and most importantly, the people of the United States themselves don't agree with you.

Probably 99.99999 percent never even heard of the issue. Yet you conclude that they actually have formed an opinion. I'd wager you never even heard of the money issue, until it appeared on this board. But even if one hundred percent of the people did not "agree", that would hardly have any bearing on the fact, that the States are making something other than gold and silver coin a tender, in contravention to the Constitution.

>> Meaning even if you could magically convince everyone that the constitution says what you think it says,...


You mean it DOESN'T actually say what I "think" it says.... Holy Mackrel! Son, in that case one of us is in a serious Orwellian delusion!!!

>> all that would happen is we would change the constitution to allow paper money. And that, really, is the ultimate argument for the irrelevance of your belief.

My belief??? Sonny, I know that government school didn't do you any good at all, but why don't you get yourself a constitution and read it before you embarrass yourself any further?

-- Rouser

[Rouser2]

Originally posted by Luke T. [/i]


>>Bzzzzzz! Wrong answer!
James Madison, Federalist Paper #42:

For your enlightenment, you may want to read a more germane essay by Madison on the subject of paper money as opposed to the one you previously referred to which only has to do with regulating the value of foreign coin under the general heading of Foreign Commerce.


But Fed. Paper # 44, to wit:

""The extension of the prohibition of bills of credit must give pleasure to every citizen in proportion to his love of justice and his knowledge of the true springs of public prosperity. The loss which America has sustained since the peace, from the pestilent effects of paper money on the necessary confidence in the public counsels, on the industry and morals of the people, and on the character of republican government, constitutes an enormous debt..."
"The power to make any thing but gold and silver coin a tender in payment of debts is withdrawn from the states on the same principle with that of issuing a paper currency."

-- Rouser

[KonTiki]

Originally posted by Ziggurat

Resorting to a gold standard has potentially disastrous consequences for the ecomony. For one thing, it provides an artificial incentive to spend lots of resources (like oil, which DOES have real value) extracting it merely because it is money, not because it is useful. That becomes a drain on the economy, and just like the tulip craze, where vast farming resources were wasted on growing a useless product because people thought of it as money, it'll come back to kick us in the rear. Not to mention that letting your monetary policy be dictated by the scarcity of a substance whose supply you can't control is the height of stupdity. Imagine if a corporation developed the kind of stranglehold on the gold supply that DeBeers has on diamonds?

This brought to mind another good example: Spain in the 17th century. Faced with a land that abounded in natural resources, what did they do? Ignored it all, and shipped all of the gold they could find back home. Completely wrecked their economy, because while they had more money, they didn't have more things to spend it on. So much for gold's "intrinsic value".

[LFTKBS]

Let's talk about the RFID tags that are allegedly in the new bills issued by the government:

http://www.geocities.com/northstarzone/MONEY.html

I don't believe your claims are true, jake.

Has anyone actually detected RF coming from a bill?

[Suddenly]

Originally posted by 69dodge


I don't actually know what "constitutional" means. In a practical sense, I guess, it means whatever the latest court decisions say it means. But, of course, that immediately raises the question, how do the courts reach their decisions? One would hope that they don't do it entirely arbitrarily, but on the other hand, they don't always seem to do it by asking themselves, "what would the authors of the Constitution say?".

Can any lawyers comment?

What the courts do with their decisions is to try to explain how the general language of the Constitution (or statute or whatever other for of positive law) applies to specific situations. Things like the the prohibition of "cruel and unusual punishment" don't really give a lot of guidence as to whether we can cane people for shoplifting. Thus the courts are left to try to build a body of specifics. There are several theories that guide this, some that emphesize the intent of the framers, some that look to public utility, some that look to the general intent of the framers of efficient government and so forth.

There is a basic split these days among constitutional scholars as to how the constitution is the be interpreted. On one end we have people like Justice Scalia who advacates a "dead document" approach; that the Constitution is to be looked at strictly by the text and the literal intent of the framers. On the other end we have "live document" types that believe the constitution was intended to not be a rigid set of rules, rather it is an intentionaly vague document meant to be re-interpreted as society changes.

This difference can be highlighted using the "cruel and unusual punishment" clause. A dead document proponent would want to judge "cruel and unusual punishment" by exactly what those words would suggest to a late eighteenth century person. What kinds of punishment George Washington and John Adams et al would see as cruel and unusual.

The live document person would look to what people today see as "cruel and unusual."

There was a pretty good article about this in Slate putting a lot of this into perspective.

http://slate.msn.com/id/2097306/

[Rouser2]

Originally posted by Suddenly [/i]

>>There is a basic split these days among constitutional scholars as to how the constitution is the be interpreted. On one end we have people like Justice Scalia who advacates a "dead document" approach; that the Constitution is to be looked at strictly by the text and the literal intent of the framers. On the other end we have "live document" types that believe the constitution was intended to not be a rigid set of rules, rather it is an intentionaly vague document meant to be re-interpreted as society changes.



The "living document" rant is nothing but Orwellian brainwash for ignoriing the clear written Supreme Law where convenient. It is one thing to interpret or re-interpret the meaning of non-specific words such as "cruel" or "unusual", but quite another to say the "no thing but gold and silver coin" can mean irredeemable paper, scrip, or electonic impulses over a computer network. Walter Williams has a good answer for those who play with words like "Living" or "dead" document: "How would you like to play a game of poker with me where I get to have the "living" rules of my choice?

-- Rouser

[Suddenly]

Originally posted by Rouser2
Originally posted by Suddenly [/i]

>>There is a basic split these days among constitutional scholars as to how the constitution is the be interpreted. On one end we have people like Justice Scalia who advacates a "dead document" approach; that the Constitution is to be looked at strictly by the text and the literal intent of the framers. On the other end we have "live document" types that believe the constitution was intended to not be a rigid set of rules, rather it is an intentionaly vague document meant to be re-interpreted as society changes.



The "living document" rant is nothing but Orwellian brainwash for ignoriing the clear written Supreme Law where convenient. It is one thing to interpret or re-interpret the meaning of non-specific words such as "cruel" or "unusual", but quite another to say the "no thing but gold and silver coin" can mean irredeemable paper, scrip, or electonic impulses over a computer network. Walter Williams has a good answer for those who play with words like "Living" or "dead" document: "How would you like to play a game of poker with me where I get to have the "living" rules of my choice?

-- Rouser

From the article I cited:




I've never been one to argue that demagogues on the right are any worse than demagogues on the left. But this practice of judiciary bashing is misguided. There is an important and real debate raging over whether the Constitution is a living document or a dead one. The question concerns whether courts should strictly construe the document (and essentially impose the framers' law), or construe it to reflect the evolving mores of a changing society. Legal scholars far smarter than Lewis and me devote lifetimes to thinking about this stuff. And reasonable minds can differ on the merits. Antonin Scalia recently expounded on the strict constructionist view. Stephen Breyer has argued for the living model.

...

But Lewis wants to upend the whole bench instead. His plan represents a categorical refusal to be bound by the decisions of any judge holding a "living Constitution" view. It says, and increasingly pundits on the far right have argued, that anyone who interprets the Constitution using a theory that differs from one's own is simply not a judge, and that law as decided by such judges is simply not law. That goes beyond demagoguery to arrogance and lawlessness. Whatever I may think of Justice Scalia and strict constructionism, I would never suggest for a moment that his decisions do not bind me.

Your poker analogy is a strawman that exposes your poor understanding of the "living constitution" idea. This concept does not advocate judges deciding the law based on a whim or their own political or economic intertest. The problem with the poker analogy is the obvious conflict of interest, where someone is deciding a dispute in which that person has a direct interest.


Furthermore, I play poker. Serious tournament poker is generally governed by the Tournament Directors Association Rules. The first rule states that:


Floorpeople are to consider the best interests of the game and fairness as the top priority in the decision-making process. Unusual circumstances can, on occasion, dictate that the technical interpretation of the rules be ignored in the interest of fairness. The floorperson’s decision is final.

http://www.cardplayer.com/?sec=afeature&art_id=13834

Whoops!! Poker Tournaments are governened by a set of rules specifically not to be interpreted in a strict textualist (or dead) manner. This call is made by a neutral official, not the player as your silly analogy suggests. So, I have played in many poker games where the rules were interpreted as a "living" document, as do many others.

[Rouser2]

Originally posted by Suddenly [/i]


>>Whatever I may think of Justice Scalia and strict constructionism, I would never suggest for a moment that his decisions do not bind me.
--------------------------------------------------------------------------------


Thankfully, when the Supreme Court upheld the Fugitive Slave laws, most northern juries refused to be bound by the decision.


>>Your poker analogy is a strawman that exposes your poor understanding of the "living constitution" idea

The whole "living" idea is Orwellian brainwash. If a document is ignored, it is not alive but dead. If an article in the Constitution is not fit for the times, there is an amending process available. But tortured thinking people of the left and the right -- especially the left, find such a process inconvenient, and thus resort to use Doublethink in place of the amending process.

-- Rouser

[Rouser2]

Originally posted by Suddenly [/i]


>>Whoops!! Poker Tournaments are governened by a set of rules specifically not to be interpreted in a strict textualist (or dead) manner. This call is made by a neutral official, not the player as your silly analogy suggests. So, I have played in many poker games where the rules were interpreted as a "living" document, as do many others.


So those rules are "living" before or after the deal? If three of a kind can beat a royal flush then you are in a poker tourney placed right out of an Orwellian Twilight Zone. I would suggest that there is no such a thing as "living" rules for poker or anything else. A referee might be needed to adjudicate disputes, but the rules, once in place are the rules. But I will admit you are some kind of con job.


-- Rousr

[Suddenly]

Originally posted by Rouser2
Originally posted by Suddenly [/i]


>>Whatever I may think of Justice Scalia and strict constructionism, I would never suggest for a moment that his decisions do not bind me.
--------------------------------------------------------------------------------


Thankfully, when the Supreme Court upheld the Fugitive Slave laws, most northern juries refused to be bound by the decision.

Which has nothing whatsover to do with judical construction. Your inability to grasp the difference between a power of the jury to not convict and the right of same has been well documented in the other thread, so lets leave that out of here.


>>Your poker analogy is a strawman that exposes your poor understanding of the "living constitution" idea

The whole "living" idea is Orwellian brainwash. If a document is ignored, it is not alive but dead. If an article in the Constitution is not fit for the times, there is an amending process available. But tortured thinking people of the left and the right -- especially the left, find such a process inconvenient, and thus resort to use Doublethink in place of the amending process.

-- Rouser

Which assumes that the document was not intended to be re-interpreted considering changing times and needs. For some reason you can't see that is something that reasonable people can differ. You lack insight and understanding of complex issues so you assume you are right and that everyone that disagrees is part of some evil plot to spread confusion and evil. That is sad.

My point was that your "poker" example was objectionable based simply on a conflict of interest analysis that had nothing to do with rule interpretation.

[Suddenly]

Originally posted by Rouser2
Originally posted by Suddenly [/i]


>>Whoops!! Poker Tournaments are governened by a set of rules specifically not to be interpreted in a strict textualist (or dead) manner. This call is made by a neutral official, not the player as your silly analogy suggests. So, I have played in many poker games where the rules were interpreted as a "living" document, as do many others.


So those rules are "living" before or after the deal? If three of a kind can beat a royal flush then you are in a poker tourney placed right out of an Orwellian Twilight Zone. I would suggest that there is no such a thing as "living" rules for poker or anything else. A referee might be needed to adjudicate disputes, but the rules, once in place are the rules. But I will admit you are some kind of con job.


-- Rousr

More strawmen. There is not a situation where "fairness" dictates changing the hand value. There are situations where application of technical rules will create a completely unfair situation not anticipated or intended under the rules, and the director has the ability to avoid absurdity.

Plus in this regard you really need to rethink your position. When you claim "the rules are rules" how do you allow for the fact that one of the "rules" calls for the other rules to not be strictly interpreted when the director deems it necessary? Should be ignore that rule? Yes or no?

Then consider an analogous argument with regard to a constitution that gives the judicial power to the courts. Guess what is a part of that "judicial power" in the opinion of many scholars (to the disagreement of some)?


Plus, I have played in tournaments where three of a kind beats a royal flush. It was a lowball tournament, but still this illustrates problems caused by sticking to universal statements without considering the context.

[Rouser2]

Originally posted by Suddenly [/i]


>>Which has nothing whatsover to do with judical construction. Your inability to grasp the difference between a power of the jury to not convict and the right of same has been well documented in the other thread...


An "inability" shared by America's first Chief Justice. You'd like to ingore the well founded principle, because, just like inconvenient Constitutional laws, you choose to declare them "dead" by calling them "living".


quote
--------------------------------------------------------------------------------

>>Your poker analogy is a strawman that exposes your poor understanding of the "living constitution" idea

The whole "living" idea is Orwellian brainwash. If a document is ignored, it is not alive but dead. If an article in the Constitution is not fit for the times, there is an amending process available. But tortured thinking people of the left and the right -- especially the left, find such a process inconvenient, and thus resort to use Doublethink in place of the amending process.

-- Rouser
--------------------------------------------------------------------------------


>>Which assumes that the document was not intended to be re-interpreted considering changing times and needs.

Certainly not in passages which are specific, clear and unequivical such as "no thing but gold and silver coin".

>> For some reason you can't see that is something that reasonable people can differ. You lack insight and understanding of complex issues so you assume you are right and that everyone that disagrees is part of some evil plot to spread confusion and evil. That is sad.

Your pop pscyho-analysis has nothing whatsever to do with the fact that today the States are making something other than gold and silver coin a tender. That is only a "complex" issue to those who refuse to accept it.


-- Rouser

[Rouser2]

Originally posted by Suddenly [/i]


>>I have played in tournaments where three of a kind beats a royal flush. It was a lowball tournament, but still this illustrates problems caused by sticking to universal statements without considering the context.

I sort of doubt that tournament poker allows changes in the rules as to what beats what after the hand is dealt. But hey, if that is your kind of game you're welcome to it.

-- Rouser

[Quixote]

My two cents:

1) Lead has been transmuted to gold. The resulting few molecules of gold were radiactive and the cost was upward of $100,000 per ounce.

2) http://www.geocities.com/northstarzone/index.html#top is obviously a parody site. "There are things they don't want you to know." :rolleyes: He might as well have used, "The Truth is out there." And his illustration of an essay against gay marriage with a picture of two hot babes about to engage in an onscreen kiss is priceless. RED WINE AND HEALTHin moderation, it has some surprising health benifits... looks like a reprint from Reader's Digest.

3) The federal government didn't need to print paper money. Almost before the ink was dry on the last ratification resolution, Alexander Hamilton was proposing a National Bank. He got one in 1791. One of the powers of that bank was the issuance of bank notes. In private commerce, the acceptance of such notes was at the discretion of the receiver. But the federal government had to accept them for all payments to the government.

[crackmonkey]

Perhaps I'm a bit slow... could you once again delineate the reasons why gold has intrinsic worth in a way that, say, paper doesn't? It seems to me that paper is more intrinsically useful than gold.
Even if you disagree with that, I think you'd be hard-pressed to find more uses for gold than for aluminum or iron.

[Chaos]

Originally posted by Quixote

*snip*

3) The federal government didn't need to print paper money. Almost before the ink was dry on the last ratification resolution, Alexander Hamilton was proposing a National Bank. He got one in 1791. One of the powers of that bank was the issuance of bank notes. In private commerce, the acceptance of such notes was at the discretion of the receiver. But the federal government had to accept them for all payments to the government.

British Pounds paper money is still (or at least it was when I last checked some years ago) formally not a currency, but more like a voucher for money. The bank notes carry the inscription:
"The Bank of England promises to pay the sum X Pounds to the bearer of this note." (UK posters please correct me if the phrasing is wrong)

If the same is true for US bank notes, then the whole debate about the constitutionality "paper money" is pointless, since bank notes are not meant to be money at all.

[Quixote]

Originally posted by Chaos


British Pounds paper money is still (or at least it was when I last checked some years ago) formally not a currency, but more like a voucher for money. The bank notes carry the inscription:
"The Bank of England promises to pay the sum X Pounds to the bearer of this note." (UK posters please correct me if the phrasing is wrong)

If the same is true for US bank notes, then the whole debate about the constitutionality "paper money" is pointless, since bank notes are not meant to be money at all.

United States notes promised the same, if I recall correctly. Federal Reserve notes do not, although I think they once did. Federal Reserve notes are definitely meant to be money.

After the charter of the National Bank expired, the demand for paper money was met by notes issued by state chartered banks. Although each note promised payment in gold, it was only as good as the bank that issued it.

[Rouser2]

Originally posted by crackmonkey
Perhaps I'm a bit slow... could you once again delineate the reasons why gold has intrinsic worth in a way that, say, paper doesn't? It seems to me that paper is more intrinsically useful than gold.
Even if you disagree with that, I think you'd be hard-pressed to find more uses for gold than for aluminum or iron.

Of course it's all a matter of degree. Of course paper has some intrinsic value. You could use it as at "tinder" (not a tender) to ignite a fire in a pinch. You could also use it in place of toilet paper. Gold has a much more prolific intrinsic value -- electronics, computers, space program, dentitry, jewelry, dishware, artwork, etc., etc., etc. But essentially, paper is intrinsically worthless.

-- Rouser

[Rouser2]

Originally posted by Chaos [/i]

>>British Pounds paper money is still (or at least it was when I last checked some years ago) formally not a currency, but more like a voucher for money. The bank notes carry the inscription:
"The Bank of England promises to pay the sum X Pounds to the bearer of this note." (UK posters please correct me if the phrasing is wrong)

>>If the same is true for US bank notes, then the whole debate about the constitutionality "paper money" is pointless, since bank notes are not meant to be money at all.


"Pointless" only if you don't either know, understand, nor care what "money" is. A "note" is indeed a promise to pay. And Federal Reserve Notes did, until relatively recently, promise to pay in "Lawful Money," meaning gold or silver coin. But that promise is no longer carried on such "notes," and if you try to redeem Federal Reserves notes, all you can get is more of the same, or in the alternative, cupra-nickel tokens. Thus the Federal Resever "Note" is not a note at all. What it really is, is, a fraud.

-- Rouser

[Rouser2]

Originally posted by Quixote [/i]


>>United States notes promised the same, if I recall correctly. Federal Reserve notes do not, although I think they once did. Federal Reserve notes are definitely meant to be money.


Certainly not by the Framers of the Constitution.


-- Rouser

[Jocko]

Originally posted by KonTiki

Gold coinage can and has been debased throughout history when the issuing government mixed in base metal. The Roman Empire immediately comes to mind.

Another old favorite is the practice of filing down the edges of gold/silver coins slightly, then passing them at face value while you accumulate a stash of gold dust to sell later.

That's why American coins have the ridges around the edges (except pennies and nickels). They're a holdover from a time when coins were actually made of silver alloys.

[crackmonkey]

Again, I contend that paper is far more useful than gold. How much paper do you use everyday (excluding money)? We write on it, read printed books and newspapers, keep records, print photographs, use it for napkins, toilet paper, kleenex...
Even if you decide that gold is indeed more intrinsically useful, why isn't aluminum of iron more valuable than gold, sine they clearly are used more than gold?

[Fade]

Without referencing the currency of any nation, what is the exact value of 1 kilogram of gold?

Please be specific.

[WildCat]

Originally posted by Quixote


United States notes promised the same, if I recall correctly. Federal Reserve notes do not, although I think they once did. Federal Reserve notes are definitely meant to be money.

After the charter of the National Bank expired, the demand for paper money was met by notes issued by state chartered banks. Although each note promised payment in gold, it was only as good as the bank that issued it.
I think that what you're referring to are "Silver Certificates". These preceded Federal Reserve notes and stated that the the value of the note could be traded for silver "payable to the bearer on demand". Before that there were Gold Certificates. Silver Certificates were discontinued in the early 1960's, IIRC. You still can find them in circulation occasionally, especially in larger denominations.

Pics (http://www.frbsf.org/currency/stability/certs/)

[Quixote]

I think that what you're referring to are "Silver Certificates".

(This might show up as a duplicate post. I thought I posted this once already.)

I was referring to United States notes, as described here: http://www.moneyfactory.com/document.cfm/5/44/129

[Quixote]

Originally posted by Rouser2
Originally posted by Quixote [/i]


>>United States notes promised the same, if I recall correctly. Federal Reserve notes do not, although I think they once did. Federal Reserve notes are definitely meant to be money.


Certainly not by the Framers of the Constitution.


-- Rouser

That's difficult to say. Possible they would object to them because they are not backed by gold or silver. However they, or at least Alexander Hamilton, had no objection to paper money. Neither did Hamilton object to the possibility that there might be more paper in circulation than was backed by gold. In his report to Congress concerning the National Bank proposal, he considered that to be a positive effect of paper money. See http://memory.loc.gov/cgi-bin/ampage?collId=llsp&fileName=009/llsp009.db&recNum=71
Hamilton's praise of paper money starts in the last paragraph on that page.

[Rouser2]

Originally posted by Quixote [/i]


>>Possible they would object to them because they are not backed by gold or silver.


A note promising to pay in "lawful money," gold and silver, is not money, but a promise to pay in money. The Framers indeed left the door open to such currency, but to enforce payment as a tender for debts, no "thing" but gold or silver coin -- never amended, but universally ignored by virtually all judges and other public officials sworn to uphold the constitution, article one, section ten of which has become one of its salient ironies, along with the Right to Keep and Bear Arms, and the immunity from unapportioned Direct taxes. And thus, the document itself, hardly "living" but a dead letter.


-- Rouser

[Quixote]

Originally posted by Rouser2
Originally posted by Quixote [/i]


>>Possible they would object to them because they are not backed by gold or silver.


A note promising to pay in "lawful money," gold and silver, is not money, but a promise to pay in money. The Framers indeed left the door open to such currency, but to enforce payment as a tender for debts, no "thing" but gold or silver coin -- never amended, but universally ignored by virtually all judges and other public officials sworn to uphold the constitution, article one, section ten of which has become one of its salient ironies, along with the Right to Keep and Bear Arms, and the immunity from unapportioned Direct taxes. And thus, the document itself, hardly "living" but a dead letter.


-- Rouser

No, it hasn't been ignored. No state has ever made anything but gold or silver coin legal tender. Thefederal government did, but it is was never prohibited from doing so. And judging by Hamilton's quick action to get circulating banknotes, cash equivalents, into the economy, at least some of the Founding Fathers thought they were a good idea.

And BTW, there are also no unapportioned direct taxes, other than, perhaps, the income tax, which, if it is a direct tax, was exempted from the apportionment requirement by the 16th Amendment.

[Rouser2]

Originally posted by Quixote [/i]

>>No, it hasn't been ignored. No state has ever made anything but gold or silver coin legal tender.

They do it every single day, since circa 1967.

>> The federal government did, but it is was never prohibited from doing so.

The Federal Government has no Constitutional jurisdiction over the matter of legal tender in payment of debts, a matter specifically left strictly to the States.

>> And judging by Hamilton's quick action to get circulating banknotes, cash equivalents, into the economy, at least some of the Founding Fathers thought they were a good idea.

Hamilton's banknotes redeemable for specie did not violate Art. One, Sec. 10. Nor is Hamilton "some" of the Founding Fathers, but just one.

>>And BTW, there are also no unapportioned direct taxes, other than, perhaps, the income tax, which, if it is a direct tax, was exempted from the apportionment requirement by the 16th Amendment.

It's an indirect excise, but currently enforced as as Direct Tax, yet not exempted by the 16th Amendment since the Supreme Court landmark tax cases ruled in 1916, that the Amendment conferred no new taxing power, since the tax was inherently indirect and thus not coming under the rule of apportionment. A careful reading of the Amendment reveals that it "amended" nothing.


-- Rouser

[Quixote]

Originally posted by Rouser2:
Hamilton's banknotes redeemable for specie did not violate Art. One, Sec. 10. Nor is Hamilton "some" of the Founding Fathers, but just one.
Hamilton could not pass the act that created the National Bank by himself. He would not have proposed the creation of a National Bank without support. He had it, because the act creating the bank was inacted in 1791.

Federal Reserve notes don't violate Art. I, Sect. 10 either. They cannot. They are a creation of the federal government. Art. I, Sect. 10 is a limitation on the power of state governments, not the federal government.


Originally posted by Rouser2:
The Federal Government has no Constitutional jurisdiction over the matter of legal tender in payment of debts, a matter specifically left strictly to the States.
The states cannot coin money or make anything but coins legal tender. They not only lack exclusive jurisdiction over the matter of legal tender, it is obvious that they retained no jurisdiction over the matter of legal tender whatsoever. It is absurd to suggest that an entity would have jurisdiction over something it had no power to effect.

[Rouser2]

Originally posted by Quixote [/i]

>>Hamilton could not pass the act that created the National Bank by himself. He would not have proposed the creation of a National Bank without support. He had it, because the act creating the bank was inacted in 1791.

The national bank in and of itself is no threat to Art. I, Sec. 10.

>>Federal Reserve notes don't violate Art. I, Sect. 10 either.

No. Only making them a tender violates the section.

>>They cannot. They are a creation of the federal government. Art. I, Sect. 10 is a limitation on the power of state governments, not the federal government.


But if the Constitution is a document which delegates powers, and it is, no power is delgated to the Federal Government to determine what is or what is not a legal tender. To presume that the absence of such delegation means that the Federal government may indeed determine what is a legal tender would presume two different kinds of legal tender -- one for the states, and one for the Feds, an absurd interpretation.


>>The states cannot coin money or make anything but coins legal tender. They not only lack exclusive jurisdiction over the matter of legal tender, it is obvious that they retained no jurisdiction over the matter of legal tender whatsoever.

On the contrary, the clear wording of the Constitution supported by the notes of Madison on the subject can yield no other logical interpretation. The whole purpose of Art. I., Sec. 10 was to bar forever the curse of a paper tender. The congress is allowed the power to "coin" money. Priniting "money" is not mentioned. And to make sure that coinage is honest -- gold and silver -- that enforcement mechanism is left to the states. It certainly is amazing how the simplest, clearest of writing in the entire document can be subject to such twisted, tortured intrepretation.

>> It is absurd to suggest that an entity would have jurisdiction over something it had no power to effect.

What is absurd is to suggest that the Federal entity would have jurisdiction over a matter specifically delegated to the States.

-- Rouser

[Quixote]

Rouser wrote:
What is absurd is to suggest that the Federal entity would have jurisdiction over a matter specifically delegated to the States.

True, but irrelevant to the issue under discussion because the power to determine legal tender was not delegated to the states.

Congress, on the other hand, was delegated the power "[t]o make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof." Art I, Sec 8, last clause.

And also, the "Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States" Art I, sec 8, first clause

The two clauses above give Congress more than enough power to authorize the printing of paper money and to designate it as legal tender.

[Rouser2]

Originally posted by Quixote [/i]


>>True, but irrelevant to the issue under discussion because the power to determine legal tender was not delegated to the states.

True. The nature of Legal Tender is defined and determined by the Constitution. But it is left to the States to enforce the provision.

>>Congress, on the other hand, was delegated the power "[t]o make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers

Oh, yeah, I knew you'd get to that one sooner or later. When at last, there is no other defense for flagrant Constitutional violations, break out that old "necessary and proper" junk. But in the Federalist Papers, the Founders clearly explained in explicit detail, that the phrase only refers to the enumerated powers, not the the creation of any new powers.

>>And also, the "Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States" Art I, sec 8, first clause

>>The two clauses above give Congress more than enough power to authorize the printing of paper money and to designate it as legal tender.

The power to lay taxes, pay debts and provide for the common defense and general welfare has nothing whatsoever to do with what shall be designated as a legal tender. But for those who never could understand what Orwellian Doublethink is all about...


-- Rouser

[Quixote]

True. The nature of Legal Tender is defined and determined by the Constitution. But it is left to the States to enforce the provision.

Cite? Never mind. It's a rhetorical question. Everyone reading this knows you're making that stuff up as you go along.


It doesn't matter anyway. The Supreme Court settled the issue in the LEGAL TENDER CASES, 79 U.S. 457 (1870).
We are not aware of anything else which has been advanced in support of the proposition that the legal tender acts were forbidden by either the letter or the spirit of the Constitution. If, therefore, they were, what we have endeavored to show, appropriate means for legitimate ends, they were not transgressive of the authority vested in Congress. 79 U.S. 457, at 552.

The US notes at issue could be redeemed for government bonds, but note for gold.

[Rouser2]

Originally posted by Quixote [/i]

>>
quote:
--------------------------------------------------------------------------------
True. The nature of Legal Tender is defined and determined by the Constitution. But it is left to the States to enforce the provision.
--------------------------------------------------------------------------------


>>Cite? Never mind. It's a rhetorical question. Everyone reading this knows you're making that stuff up as you go along.

Cite? Art. I., sec. 10. "No State Shall... Make Any Thing but Gold and Silver Coin a tender...."

No. I didn't make that up. It's right there in the document. It requires no further citation.


>>It doesn't matter anyway. The Supreme Court settled the issue in the LEGAL TENDER CASES, 79 U.S. 457 (1870).

quote:
--------------------------------------------------------------------------------
We are not aware of anything else which has been advanced in support of the proposition that the legal tender acts were forbidden by either the letter or the spirit of the Constitution. If, therefore, they were, what we have endeavored to show, appropriate means for legitimate ends, they were not transgressive of the authority vested in Congress.
--------------------------------------------------------------------------------

79 U.S. 457, at 552.

>>The US notes at issue could be redeemed for government bonds, but note for gold.


The Supreme Court cannot re-write the constitution and there is nothing in those cases that alters the fact that the States are Constitutionally prohibited from making any thing but gold and silver coin a tender. Get it??? Nah!


-- Rouser

[Quixote]

Get it???

Yes. I understand now. I should assume that your unsubstantiated opinion is correct even though the Supreme Court of the United States disagrees with you and the plain language of the Constitution contradicts you.

If you find the time, send me a postcard from the Emerald City.

[Rouser2]

Originally posted by Quixote [/i]

Yes. I understand now. I should assume that your unsubstantiated opinion is correct even though the Supreme Court of the United States disagrees with you


It's not an "opinion" but a direct Constitutional quote which requires no further substantiation. Nor has the Supreme Court ever directly addressed the issue.

>>and the plain language of the Constitution contradicts you.


And just what plain language would that be? That the States [b]CAN[/b} make something other than gold or silver coin a tender?

-- Rouser