The Utah Monetary Summit

I'm not going to try to be clever this week, but I am hoping you'll share my enthusiasm for some great things that are happening – things which began in Utah, and are spreading!

First, as the map shows, Utah leads the nation, having enacted legislation making gold and silver (called "sound money," "natural money" or "hard currency") legal tender in the State. This was discussed in detail in my previous post, "Sound Money Rings True." Implementation in Utah is being studied and more legislation, refining the process and setting up regulations, will be on the agenda for the 2012 legislative session.

Part of that study included the first annual Utah Monetary Summit, held 26 September at the Officers Club of Fort Douglas – an old Army post now owned by the University of Utah. The one-day event was mind-blowing:

• About two dozen members of the Utah House and Utah Senate (plus one congressional candidate who helped get the Utah Legal tender Act passed) were planning on attending; most, if not all, were there for part of the day.
• Members of other state legislatures were in attendance.
• I personally spoke with visitors from Idaho, Missouri, New York, South Carolina and Canada. I heard of attendees coming from many additional states.
• Presenters came from all over the country and Europe, representing proponents of sound money, economic experts, the business community and citizen action groups.
• 15 sessions discussed everything from case law covering sound money to economic theory.

The Program:

I cannot discuss in detail everything that went on – frankly, I only attended the morning sessions because I was on information overload. I felt like a freshman film student (which I was 33 years ago) attending a graduate economics seminar. I will share a few choice quotes:

James Turk, Gold Money Foundation: "Natural money evolved from the market, not from the state."

Eddie Allen, American Open Currency Standard: "Communities are not waiting around for permission to survive."

Zeno Dahinden, Emirates Gold: On trying to work with the government, "We had to go to the poor, because they are the ones being robbed by the fiat system."

David Morgan, The Morgan Report: "The federal government won't solve this problem, the states must act."

Charles Kadlec, Forbes columnist: "The price of oil hasn't gone up; the value of the dollar has gone down.

Nathan Lewis, author of Gold: The Once and Future Money: "Everywhere in the world, everyone used the gold standard until 1971 . . . because it works."
 

Richard Ebeling, Northwood University: In the 19th Century, "Money was used as a market-based medium of exchange."

Nathan Welch: Equity International Foundation: "Either money is debt – the right to spend now based on future labor – or money is equity – the right to spend now based on previous labor."

Dave Garrett, Garrett Capital: Discussed his proposal to create a currency based on stored food, similar to the system created by Joseph for Pharaoh in Egypt. [see Genesis 41]

Olivier LeDoit, University of Zurich: Discussed the "wir," a privately-issued, fiat currency begun in Switzerland in 1934. From an initial group of 16 with $40,000, it has grown to over 16,000 (mostly small businesses) who trade over $1 billion annually.

Bill Still, author & filmmaker: Discussed the Bank of North Dakota Model.

Alex Chaufen, Atlas Economics Research Foundation: "The Battle for sound money must be fought outside economics." Quoting his former economics professor: "Printing money means lying, and knowing that you're lying and stealing, and knowing that you're stealing."

For Your Study:
 

The sessions were recorded and the recordings will be posted at the Summit website. The Summit was organized and operated by a group of great volunteers, who have regular jobs and families and such so, please be patient, it will take a while. Until then, I offer a couple of teasers.
 

Teaser One – case law:

The natural first question is, "Is this legal?" After all the federal government has run the US monetary system for about 100 years, since most of our grandparents were toddlers. Can states actually do this? I quote the US Constitution, Article 1 Section 10 (emphasis added):

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

The Founders knew the danger of paper money; they saw it during the Revolutionary War. They wanted to guarantee safe currency so one of the few limitations specifically placed on the several States is hard currency. There is substantial case law to support sound money:
 

Brown v Rhodes 74 US 229,245-246 (1869): The Court found that payment of money by contract to deliver a certain number of dollars means a certain weight of standard gold; such payments may be in coin or bullion.
 

US v Marigold 50 US 560,567-568 (1850): Congress has a trust to maintain the gold standard as the standard for US currency. (Pres. Nixon removed the USA from the gold standard in 1971, an act which, in this pundit's view, was entirely unconstitutional – and which wasn't specifically mentioned in Executive Order 11615.)
 

Hagar v Reclamation District #108 111 US 701,706-707 (1884): States have the right to collect taxes in any form they choose – states can accept goods, services, bullion, etc. The use or acceptance of notes is strictly and absolutely the option of the State.
 

Teaser Two – grassroots effort:

Lt. Col. Ray Moore was an Army chaplain. Now retired, he is a member of the South Carolina Sound Money Committee, working to pass a legal tender act in the Palmetto State. He noted that the "Corrupt money practices of the German Weimar Republic (1923-25), resulted in the rise of Nazism and Hitler to power." (I assume all of us remember high school history classes in which we saw pictures of Germans pushing a barrel of mark notes to the bakery for a loaf of bread.) He noted that the Bible specifically mentions gold and silver as money [see Genesis 44:8; 2 Kings 12:13; 23:35; 2 Chronicles 24:14]. In May of this year, the South Carolina Republican Party approved a resolution supporting a legal tender act. Mr. Moore noted that the South Carolina legislature was encouraged by the passage of the Utah Legal Tender Act.

Finale:

Citizens for Sound Money and other interested groups drafted the Utah Monetary Declaration, a statement of agreement on basic sound money principles, which was signed by over 100 of the attendees. Among other things, it states:

. . . WHEREAS, natural money, in whatever form, benefits society by maintaining stable purchasing power and circulating on a voluntary and unencumbered basis, thereby promoting prosperity and unity within any community upholding it; . . .
WHEREAS, the right to choose constitutes the chief cornerstone of a free market and of a unified, prosperous and free society . . .
We hereby urge business leaders, members of the media, legislators, government officials, judicial and law enforcement officers as well as the public at large to use their best combined efforts to reinstate and promote the legal and commercial framework necessary to establish and maintain well-functioning, sound monetary systems based on choice in currency.

As I approached the podium to add my name, I was reminded of Stephen Hopkins. In 1776, the representative from Rhode Island approached John Hancock's desk to take his turn signing the Declaration of Independence. Nearly 70 and suffering from palsy, he reportedly said, "My hand trembles. My heart does not."

Plans are underway for the second summit, to be held next fall. Hope to see you there.

Thanks for listening, tune in next week for another rant.