We don’t need a Virginia currency
By Brian Schoeneman | Wednesday, January 5th, 2011 | PolicySomeday, I would love to sit down and have a long conversation over coffee with Delegate Bob Marshall. There are times when he and I see eye to eye on issues, and then there are times when I really just have to question what he’s thinking. I can understand and even respect his stance on the gays in the military issue, even if I disagree wholeheartedly with it. But I just don’t see any good reason to propose that Virginia begin to mint its own currency – gold and silver coins – to foster “competition” with the Federal Reserve Bank.
There are a lot of adjectives that could categorize this proposal, and I will allow all of you to come up with a few. But, for charity’s sake, I will simply say that it’s unnecessary and a waste of time – both his and the General Assembly’s.
I’m not going to argue with Marshall regarding the law, because as far as my reading of his proposal, he’s not saying anything that’s inaccurate. Individuals can use any kind of currency they want to pay private debts as long as both sides agree. If you mow my yard and are willing to accept a six pack of beer in payment, that’s fine. And States may choose to require payment of their debts in any kind of coin or currency they want, as well. But that doesn’t mean its a good idea or one we should be pursuing.
In an environment where we are doing our best to cut and cut from the Commonwealth’s budget in order to ensure we don’t have to raise taxes to meet our obligations, I don’t know why anyone – especially a fiscal conservative – would propose any kind of plan like this that if implemented would require all kinds of new bureaucracy in Richmond. It’s not like we’ve got a Virginia Bureau of Engraving and Printing sitting around ready to strike gold and silver coins. All of that costs money, money we don’t have and money we can’t afford to waste duplicating things the federal government already does.
I’m well aware of the far right’s distrust of the Federal Reserve System. I think it’s paranoia writ large, to be frank, and the hyperinflation threat we may face won’t be ameliorated by Virginia issuing its own currency, even if it is based on precious metals. Why? Because no one is going to use it unless they are forced to. So unless Marshall also plans to force Virginians to pay their taxes in gold coins (which makes no sense – we want it to be easy to pay taxes, not harder) no one is going to use the currency. We can’t even get people to use dollar coins, and he thinks folks will use this? Besides, people aren’t paid in “Federal Reserve Note” paper currency anymore as it is. They’re paid electronically or via check, in dollars. Managing exchange rates from Dollars to whatever the Commonwealth would set up is a massive headache in and of itself. It would give banks another excuse to nickel and dime (pun intended) all of us, and it has the potential to turn the United States into Europe in the pre-Euro days. How is that a good thing?
If Marshall is concerned about the Federal Reserve System, that’s great – he can make reforming the Fed a central plank in his Senate campaign. But there’s no reason to fiddle with things at the state level. My mother used to tell me that the fact that you can do something doesn’t mean you should. The fact that Virginia has the authority to implement its own currency doesn’t mean we should. And, frankly, I don’t think it’s worth it to even waste the money studying the issue. Marshall’s proposal calls for a study that should cost “no more than $12,000.” That’s $12,000 that can be far better spent on something substantive. The fiscal conservative side of me really doesn’t appreciate wasting anyone’s tax dollars, even a sum as small (relatively) as $12,000.
With the number of real, legitimate issues facing the Commonwealth, from the current state of transportation to getting our economy going, I think it’s critical that our legislators keep their eyes on the ball and not try to find solutions for problems that don’t exist.
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A veteran political professional, a long-time Republican party activist and new attorney, Brian W. Schoeneman has been offering his opinions at Bearing Drift since 2010. He serves on the Board of Virginia Line Media, LLC, which operates Bearing Drift and spends his days representing the U.S. Merchant Marine in Washington, D.C. He hails from Fairfax County, Virginia, where he lives with his wife and son.
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24 Responses to "We don’t need a Virginia currency"
Except Virginia does not even have the authority to coin its own currency. Art. 1, Sec. 10 expressly prohibits states from coining money. I just don’t get what possesses Delegate Marshall. His antipathy to the federal government has led him to introduce ridiculously blatantly unconstitutional legislation.
Brian –
I think you’ve stumbled upon an EXCELLENT idea:
So the solution is simple. Establish breweries across the Commonwealth, wait for civilization to collapse, and then go to the Winchester, have a nice cold pint, and wait for all this to blow over…
(gratuitous Shaun of the Dead reference added at no extra charge)
Brian,
I am sorely disappointed that you can’t embrace this brilliant concept. We could manipulate our currency exchange rate to the US dollar to keep Virginia products competitive, just like the Chinese do. When the Fed crashes, our currency will skyrocket in exchange value, so speculation in Virginia currency will soar–increasing its exchange value even before the Fed goes tits up. Best of all, our monetary policy in Virginia will be firmly under our local control and not vulnerable to the schemes of the Zionist Occupation Government and the New World Order. I really don’t understand how an educated person like you can fail to grasp the logic of Delegate Marshall’s proposal.
I suggest that the new Virginia currency denomination be the Virginia Reel. I’m going to bid on the contract to operate all the currency exchange kiosks at the Virginia Welcoming Centers so that I can make a fortune overcharging Yankees to change their dollars into reels and vice versa when they leave. (They DO leave, don’t they?)
We get it already about Del. Marshall and his grandstanding. Aren’t there greater and perhaps more achievable lunacies being plotted by the VA Dems at the statehouse or the remaining Dem US Reps and Senators that we should be concentrating on? Webb and Warner may be in hiding but they’re probably up to no good wherever they are. Also we do have a 2011 election here and IIRC the Repubs managed to lose a winnable Senate seat after McDonnell’s election.
Damn he went from just vile to stupid in how long… wow… Last time I saw the wheels come off like this I was at a Nascar race.
history | hilite | pdf
11102035D
HOUSE JOINT RESOLUTION NO. 557
Offered January 12, 2011
Prefiled January 5, 2011
Establishing a joint subcommittee to study whether the Commonwealth should adopt a currency to serve as an alternative to the currency distributed by the Federal Reserve System in the event of a major breakdown of the Federal Reserve System. Report.
———-
Patron– Marshall, R.G.
———-
Committee Referral Pending
———-
WHEREAS, the Supreme Court of the United States has ruled in In re Rahrer, 140 U.S. 545, 554 (1891), that “the police power” of a State “is a power originally and always belonging to the States, not surrendered by them to the general government, nor directly restrained by the Constitution of the United States, and essentially exclusive”; and
WHEREAS, the Supreme Court of the United States has ruled in Beer Company v. Massachusetts, 97 U.S. 25, 33 (1877), that the police power of the States “extend[s] to the protection of the lives, health, and property of the[ir] citizens, and to the preservation of good order”; and
WHEREAS, the protection of the lives, health, and property of Virginia’s citizens, and the preservation of good order in the Commonwealth, depend upon the maintenance of both an adequate system of governmental finance and a sound and robust private economy; and
WHEREAS, an adequate system of governmental finance and a sound and robust private economy cannot be maintained in the absence of a sound currency; and
WHEREAS, the present monetary and banking systems of the United States, centered around the Federal Reserve System, have come under ever-increasing strain during the last several years, and will be exposed to ever-increasing and predictably debilitating strain in the years to come; and
WHEREAS, many widely recognized experts predict the inevitable destruction of the Federal Reserve System’s currency through hyperinflation in the foreseeable future; and
WHEREAS, in the event of hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System, for which the Commonwealth is not prepared, the Commonwealth’s governmental finances and Virginia’s private economy will be thrown into chaos, with gravely detrimental effects upon the lives, health, and property of Virginia’s citizens, and with consequences fatal to the preservation of good order throughout the Commonwealth; and
WHEREAS, Virginia can avoid or at least mitigate many of the economic, social, and political shocks to be expected to arise from hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System only through the timely adoption of an alternative sound currency that the Commonwealth’s government and citizens may employ without delay in the event of the destruction of the Federal Reserve System’s currency; and
WHEREAS, “legal tender” denotes a currency that must be accepted in payment of a debt denominated in United States “dollars” if the parties have not stipulated that some alternative currency is to be used as their medium of payment or are not otherwise required to use such alternative currency; and
WHEREAS, the Federal Reserve System’s currency has been designated “legal tender” under color of Title 31, United States Code, Section 5103; and
WHEREAS, under Title 12, United States Code, § 411 and Title 31, United States Code, § 5118(b) and (c), the Federal Reserve System’s currency is not redeemable in gold or silver coin or the equivalent in bullion; and
WHEREAS, that the Federal Reserve System’s currency is not redeemable in gold or silver coin or the equivalent in bullion is being identified by more and more experts as a, if not the, major reason for the ever-increasing instability of the Federal Reserve System; and
WHEREAS, all gold and silver coins of the United States are designated “legal tender” under the aegis of Title 31, United States Code, §§ 5103 and 5112(h), and must be so designated perforce of Article I, Section 8, Clause 5 and Article I, Section 10, Clause 1 of the Constitution of the United States; and
WHEREAS, pursuant to Article I, Section 10, Clause 1 of and the Tenth Amendment to the Constitution of the United States, each State must make gold and silver coin a Tender in Payment of Debts; and
WHEREAS, the Supreme Court of the United States in Lane County v. Oregon, 74 U.S. (7 Wallace) 71, 76-78 (1869), and Hagar v. Reclamation District No. 108, 111 U.S. 701, 706 (1884), has ruled that the States may adopt whatever currency they desire for the purposes of performing their sovereign governmental functions, even to the extent of adopting gold and silver coin for those purposes while refusing to employ a currency not redeemable in gold or silver coin that Congress has designated “legal tender”; and
WHEREAS, “the police power” being the primary sovereign governmental function of every State, under Lane County and Hagar every State may adopt its own currency, consisting of gold or silver, or both, whenever necessary and proper to facilitate exercises of that power in aid of the general welfare of the State and its citizens; and
WHEREAS, under the aegis of Title 31, United States Code, § 5118(d)(2), and perforce of Article I, Section 8, Clause 5 and Article I, Section 10, Clause 1 of, and the Ninth and Tenth Amendments to, the Constitution of the United States, Americans may employ whatever currency they choose to stipulate as the medium for payment of their private debts, including gold or silver, or both, to the exclusion of a currency not redeemable in gold or silver that Congress may have designated “legal tender”; and
WHEREAS, under the aegis of Title 31, United States Code, § 5118(d)(2), and perforce of Article I, Section 8, Clause 5 and Article I, Section 10, Clause 1 of, and the Ninth and Tenth Amendments to, the Constitution of the United States, the citizens of Virginia may choose to employ as the medium for payment of their private debts whatever alternative currency, consisting of gold or silver, or both, that the Commonwealth may adopt in the exercise of “the police power”; and
WHEREAS, in light of the possible instability of the Federal Reserve System, proposals for states and their citizens to adopt an alternative currency consisting of gold or silver, or both, are receiving increasing attention throughout the United States, as evidenced by bills that have been or are being introduced in the legislatures of the States of Georgia, Indiana, Montana, New Hampshire, and South Carolina; and
WHEREAS, various systems of alternative currency employing gold or silver, or both, in the form of coin or its equivalent in bullion have already proved themselves in the free market, and could either be employed by the Commonwealth directly or be used as models for a new system created by the Commonwealth to meet Virginia’s unique needs; and
WHEREAS, the adoption of an alternative currency consisting of gold or silver, or both, would not destabilize the present monetary and banking systems, the Commonwealth’s governmental finances, or Virginia’s private economy, because it would not compel or commit the Commonwealth or her citizens to employ such alternative currency to the exclusion of the Federal Reserve System’s currency immediately, but would merely make the alternative currency available, and enable it to be used in competition with and preference to the Federal Reserve System’s currency, to the degree that the need for such use became apparent; and
WHEREAS, the United States Congress, the U.S. Department of the Treasury, and the Federal Reserve System have taken and are preparing to take no action to provide the United States with an alternative to the Federal Reserve System’s currency, in the likely event that the latter would be destroyed through hyperinflation; and
WHEREAS, because legislators in Virginia know or should know all of these facts; and because the General Assembly has the authority, the ability, and the duty to take timely action to deal with this situation without first seeking the approval of or assistance from Congress or any other state; and because the Constitution of Virginia provides, “That all power is vested in, and consequently derived from, the people, that magistrates are their trustees and servants, and at all times amenable to them”—for these reasons, the citizens of the Commonwealth will properly conclude that the members of the General Assembly will be primarily responsible if the Commonwealth is found to be without an alternative currency when the Federal Reserve System’s currency collapses in hyperinflation, or some other related economic calamity supervenes; now, therefore, be it
RESOLVED by the House of Delegates, the Senate concurring, That a joint subcommittee be appointed to study whether the Commonwealth should adopt a currency to serve as an alternative to the currency distributed by the Federal Reserve System in the event of a major breakdown of the Federal Reserve System.
The joint subcommittee shall consist of eight legislative members who shall be appointed as follows: five members of the House of Delegates to be appointed by the Speaker of the House of Delegates in accordance with the principles of proportional representation contained in the Rules of the House of Delegates and three members of the Senate to be appointed by the Senate Committee on Rules. The joint subcommittee shall elect a chairman and vice-chairman from among its membership.
In conducting its study, the joint subcommittee shall call or hear from such witnesses and take such other evidence as it deems appropriate and shall consider recommendations for legislation, with respect to the need, means, and schedule for establishing such an alternative currency.
Administrative staff support shall be provided by the Office of the Clerk of the House of Delegates. Legal, research, policy analysis, and other services as requested by the joint subcommittee shall be provided by the Division of Legislative Services. Technical assistance shall be provided by the Treasurer of the Commonwealth of Virginia and the Bureau of Financial Institutions of the State Corporation Commission. All other agencies of the Commonwealth shall provide assistance to the joint subcommittee for this study, upon request.
The joint subcommittee shall be limited to six meetings for the 2011 interim, and the direct costs of this study shall not exceed $12,000 without approval as set out in this resolution. Approval for unbudgeted nonmember-related expenses shall require the written authorization of the chairman of the joint subcommittee and the respective Clerk. If a companion joint resolution of the other chamber is agreed to, written authorization of both Clerks shall be required.
No recommendation of the joint subcommittee shall be adopted if a majority of the House members or a majority of the Senate members appointed to the joint subcommittee (i) vote against the recommendation and (ii) vote for the recommendation to fail notwithstanding the majority vote of the joint subcommittee.
The joint subcommittee shall complete its meetings by November 30, 2011, and the chairman shall submit to the Division of Legislative Automated Systems an executive summary of its findings and recommendations no later than the first day of the 2012 Regular Session of the General Assembly. The executive summary shall state that the joint subcommittee intends to submit to the General Assembly and the Governor a report of its findings and recommendations for publication as a House or Senate document and shall specify the date by which the report shall be submitted. The executive summary and the report shall be submitted as provided in the procedures of the Division of Legislative Automated Systems for the processing of legislative documents and reports, and shall be posted on the General Assembly’s website.
Implementation of this resolution is subject to subsequent approval and certification by the Joint Rules Committee. The Committee may approve or disapprove expenditures for this study, extend or delay the period for the conduct of the study, or authorize additional meetings during the 2011 interim.
Legislative Information System
WHEREAS, Delegate Bob Marshall appears to have lost his cookies and believes that the United States will imminently suffer a financial Armageddon that will make the 20%+ prime interest rates of the Carter Administration look like deflation, and
WHEREAS, Delegate Bob Marshall believes that you can isolate the Commonwealth from the consequences of the attendant social disorder, political instability, and financial disruption by merely coining gold and silver currency, and
WHEREAS, Delegate Bob Marshal wishes for the Commonwealth of Virginia to join hands with other delusional conspiracy theorists in other states who are equally marginalized in their own legislatures, and
WHEREAS, the voters of Prince William County know or should know that Delegate Bob Marshal has become an embarrassment to the General Assembly, therefore be it
RESOLVED by the voters of Prince William County that this kind gentleman deserves a peaceful retirement from public office.
You’ve lost it, Delegate Marshall. You are not going to ride the Tea Party mantra to the US Senate. Just ask Joe Miller, Sharon Angle, and Christine O’Donnell.
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I agree with Shaun!
California already started printing its own currency when the state went bankrupt. Those IOUs were used in place of American dollars and were backed by the full faith and credit of California’s government.
By the way, does Virginia even have adequate silver and gold mines to pull this off? Copper?
James, Virginia has plenty of coal!
Brian: You suggested that we come up with our own ajectives to describe this idea. “Neo-secessionist” is the one that leaps to mind. I’ve defended Del. Marshall more than once from people who’ve calle dhim “supid” or “latently gay” for the National Gaurd bill. But this is nuts.
I’m speechless…
Leaving aside the merits of this particular proposal, I take issue with you, Brian, about this . . .
“it has the potential to turn the United States into Europe in the pre-Euro days. How is that a good thing?”
Ask the Irish or the Greeks (soon to be joined by the Portugese or Spanish). A joint currency for economies on different cycles is a recipe for, well, for the disaster that is presently the eurozone.
D.J. , are you suggesting that a Virginia currency could save us from California?
Hmmmm……..score one for Delegate Marshall. Sometimes a blowout isn’t as bad as a complete shut out.
There are issues with our Federal Reserve. Legislation like this highlights that. A good thing, but let the other states make the noise on that. Virginia, partly thanks to Del. Marshall, is on the forefront of states rights issues in regard to fighting Obamacare. Cuccinelli is making serious headway and we don’t help his effort by opening the door for critics to start crying “kook Viriginia” as they point to all the other legislation.
Like outlawing gays in the Virginia Guard.
Like preparing to coin our own currency.
Proving my point, look at the adjective suggested by Steve. “Neo Secessionist”. Multiple legislation along the same lines makes Virginia look just like that. It damages the credibility of good people making courageous stands that already bring relentless criticism. We don’t need to hamstring Cuccinelli’s ongoing effort.
I would encourage Del. Marshall to quit going back to the well. Give us the best chance of neutering Obamacare.
[...] feasibility of alternative currencies. Indeed, there are no shortage of blog posts out there today questioning his sanity, or using it as a convenient excuse to engage in a little snarky name calling (BTW – [...]
I was going to write a long post engaging the legislation, but I decided not to waste my time. What I will say is that the court cases Marshall cites don’t support him, because Oregon and California were still requiring payment of taxes in American currency – just a specific form of it.
In any event, Marshall has this fiction that Virginia’s going to mint coins that aren’t money, but you can trade in your dollars for these coins, and then there’ll be a debit system where you can have an account filled with your coins, and use your debit card to buy things, but yet it’s not money – it’s just patently absurd.
It is amusing to me that all the people here who think this is such a dumb idea don’t seem to realize that competing currencies were proposed by a Nobel Prize winning economist, Friedrich A. Hayek, and that the rationale for having competing currencies is very compelling, as spelled out in Hayek’s book _The Denationalization of Money_.
Americans are such an ignorant lot, and those who imagine themselves intellectually superior are invariably the most egregious examples of a blank slate.
What’s next….we’re illiterate?
Of course, I have no doubt that the proposal would be deemed unconstitutional, as suggested above. Besides, the federal government would never allow it even if it weren’t unconstitutional. Without the Federal Reserve System, the legal tender laws and so forth, they would have a much much harder time putting their boot on your neck and robbing you blind.
When it comes to economics, the answer is evidently Yes.
btw, in case y’all haven’t noticed, Europe was much better off before the arrival of the Euro. The monetary union there was always a joke, and it was described as such at the outset by more than one notable economist. The truth is that central banking is a key player in the world financial crisis. Our own current and third attempt at central banking will ultimately end in failure as well. But just keep thinking that anyone who points this out is a far-right extreme whacko. If you’re lucky the thing won’t completely unravel before you depart this rock.
Kenneth, funny how you call us Americans an ignorant lot and note those professing intellectual superiority as being the most egregious examples.
I agree with your Europe example, although over time……lots of it, things would improve. They would need to go through a process similar to our original 13 colonies did. Federalizing, standardizing, and budgeting in the new variables over time. Then things would normalize and balance.
However, I wasn’t completely being sarcastic about a Virginia currency saving us from California in an earlier post. They might be our “Greece”! That and there are large problems going on with our Federal Reserve and our currency being played with. Raising the idea of competing currencies is a good idea! It puts the nation and the Fed on notice that people are watching.
That said, we don’t need to abandon the dollar as some suggest. Not at this point anyway. That and Virginia needs to stay out of that arena for tactical reasons. Virginia is going the “states rights” route on another important issue. Virginia needs to concentrate on that front and not give critics fodder with which to accuse us of being neo-secessionists.
Thanks for insulting Americans with that broad brush of yours, though. I’m sure that wins you a lot of friends. Even ones that might agree with you on some fronts.
Notice the federal government employing many people in Northern Virginia? I wonder how fast that will disappear should this law pass.
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