by Sean Kelly
It has been a challenging year for Americans. Our prosperity has suffered badly, our civic life has frayed, and our health has been endangered.
But amidst those challenges, what better time than a celebration of the Fourth of July with family and friends to think about the things that enabled America to prosper as it did. As you fire up the grill and sips a cold drink, take time to remember that the founders specifically wrote into the Constitution a gold and silver based monetary system for the new nation.
Before the Constitution, America’s financial conditions were, frankly, a mess. By 1779, just three years after the Declaration of Independence was signed in Philadelphia, inflation was beginning to race out of control.
The Continental dollar, which had been worth about 25 cents a year earlier, had wasted away to about a penny. George Washington wrote at the time that “a wagon load of money will scarcely purchase a wagon load of provisions.”
Not long thereafter, the Continental Congress wouldn’t even accept its own money in payment of debts.
The causes of the bitter “not worth a Continental” experience was not lost on those who gathered to frame the Constitution. Perhaps a few of them also surveyed the centuries and noted the flourishing of cultures and countries that relied on honest precious metal currencies.
So, first of all, they gave the Congress the power to coin money. It’s quite explicit in Article I, Section 8: “Congress shall have Power…to coin Money.”
The failure of paper money was fresh on their minds, so, knowing the difference they wrote “coin,” not “print. That should have made it hard to conflate today’s irredeemable, unbacked printing-press and digital monetary schemes with the money authorized by the Constitution.
In Section 10 they addressed the monetary system again without ambiguity: “No state…shall make any Thing but gold and silver Coin a Tender in Payment of Debts.”
They took these steps to make sure that the new Constitution protected the people’s money and their wealth.
One of the framers expressed a popular opinion when he said at the time that he would rather the entire proposed Constitution fail than to let it incorporate a paper money system.
Maybe someone should have put in a specific provision prohibiting a paper money system. But Alexander Hamilton argued a general principle in the Federalist Papers that there was no need to prohibit any power to the general government that it had not been expressly granted.
Today gold and silver are nowhere to be found in the State’s monetary system.
That means that today, our politicians having failed to do what the founders wished. They failed to maintain a sound monetary system that protects your wealth.
Today you have to protect your own wealth.
So have a happy Fourth of July. Spend some time thinking about the blessings of liberty this week. And when you or someone you know needs help protecting their wealth, reach out to us at here at Red Rock Secured.
It’s what we do.
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