Utah Takes Major Step Toward Breaking Federal Reserve’s Monopoly on Money


Given that paper money, divorced from a gold standard, will lose value over time, and that people dislike watching their savings lose purchasing power, it’s little wonder that there is talk of returning to a gold standard so the value of paper currency is actually tied to something tangible that is of value. It is also no wonder that there is a desire to re-monetize gold and silver so they can be used in trade.

This is exactly what we are seeing in Utah. Legislation has been passed and additional legistation is under consideration to create sound money whose value cannot be debased by actions of the Federal Reserve Bank.

A bill introduced in the Utah legislature would build on the state’s Legal Tender Act, creating a foundation for further action to encourage the use of gold and silver as money, and take another step toward breaking the Federal Reserve’s monopoly on money.

Rep. Ken Ivory (R-West Jordan) introduced House Bill 224 (HB224) on Jan. 27. The legislation would add several provisions to state law designed to encourage the use of gold and silver as legal tender. Passage would set the stage for expansion of gold repositories in the state and authorize further study on several sound money policies.

Specifically, HB224 would authorize the investment of public funds in specie legal tender held in a commercial specie repository. Under existing code, “specie legal tender” means gold or silver coin and bullion. “Commercial specie repository” means an institution that holds or receives deposits of specie legal tender that is located within the state. Practically speaking, passage would give the state the option to hold funds in gold and silver instead of Federal Reserve notes.

Utah is not the only state focusing on creating sound money as an alternative to Federal Reserve Notes.

Gov. Greg Abbot signed legislation creating a Texas gold bullion and precious metal depository in June of 2015. The facility will not only provide a secure place for individuals, business, cities, counties, government agencies and even other countries to to store gold and other precious metals, the Texas law also creates a mechanism to facilitate the everyday use of gold and silver in business transactions. In short, a person will be able to deposit gold or silver – and pay other people through electronic means or checks – in sound money.

Ivory said “secure public transaction is the ultimate goal” in Utah as well.

And the ability of those in Utah to use gold and silver for everyday transactions is getting closer.

In 2011, Utah became the first state in over 80 years to pass a law making gold and silver coin legal tender. The following year, the legislature followed up, approving a bill clarifing several tax measures and more importantly, expanding the definition of specie to include gold and silver coin approved by the state.

Passage of HB224 would take the next step forward and further open the door for the use of gold and silver in everyday transactions in the state.

But is this legal? Can states introduce gold and silver as legal tender in competition with Federal Reserve Notes?

The United States Constitution states in Article I, Section 10, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.” States have simply ignored this constitutional provision for years. It’s impossible for states to return to a constitutional sound money system when it taxes gold and silver as a commodity.

State actions like Utah’s Constitutional Tender Act, and the creation of a bullion depository in Texas take steps toward that constitutional requirement, ignored for decades in every state and sets the stage to undermine the monopoly of the Federal Reserve by introducing competition into the monetary system.

And this is how we get rid of the Federal Reserve Bank which has been a vehicle for the destruction of the purchasing power of the people’s money for its entire existence over the past 100 years.

By making gold and silver available for regular, daily transactions by the general public, the state depositories create the potential for wide-reaching effect. Professor William Greene is an expert on constitutional tender and said in a paper for the Mises Institute that when people in multiple states actually start using gold and silver instead of Federal Reserve notes, it would effectively nullify the Federal Reserve and end the federal government’s monopoly on money.

This is a movement that takes power from the banking elite and returns it to the people. It should be encouraged in every state before reckless spending in Washington and the creation of massive quantities of paper dollars by the Federal Reserve destroy what value our paper money has left.

Representative Ivory also sponsored Utah’s “The Transfer of Public Lands Act” H.B. 148, which was signed into law on March 23, 2012 Governor Gary Herbert. This retook land back from the feds, which at the time accounted for  64.5 percent of Utah’s total land mass.

Source: Tenth Amendment Center

Photo, Rep. Ken Ivory (R-West Jordan): Salt Lake Tribune



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