U.S. money has changed a great deal since first
defined in 1792. The Constitution only
gave Congress the power to coin money, not print it!
“The Congress shall have Power . . . ‘To coin Money,
regulate the Value thereof, and of foreign Coin, and fix the Standard of
Weights and Measures’”. (Art. I, Sec. 8
§5). Simple language but it required
enabling legislation to fulfill.
Thus, in 1792, the U.s. Congress passed just such a
law. US money was defined as “dollars or
units”, the word “dollar” coming directly from the Spanish milled “dollar”
commonly known as a “piece of eight”. A
standard dollar contained 371-4/16th parts of a grain of pure
silver. The gold “Eagles” were
equivalent in value to 10 silver dollars and contained 257-4/8ths of a grain of
pure gold (equal to 3,712-1/2 grains of fine silver).
According to the Constitution, “No State shall . . .
make any Thing but gold and silver Coin a Tender in Payment of Debts . . .”
(Art. 1, Sec. 10, §1)
That definition of the dollar has never been
changed!
Because the colonies had “printed” money during the
Revolution and immediately thereafter in order to finance the war, such paper
became more a “promissory note” than a medium of exchange and their value sunk
disastrously. The devastating inflation
that existed at that time influenced the founders to the point they wanted
nothing to do with “paper money”. Thus,
the establishment of the gold and silver standard as the foundation for US
currency. This standard has never been
repealed!
The Founding Fathers intended that there be uniform
standards for the currency and the weights and measures to be used in
commerce. That way, all citizens
regardless of where they lived could
rely on the fact that a foot or a dollar always had the same value in every
state, east or west, wherever encountered or employed.
Ever since Lyndon Johnson’s administration, the
coinage minted has been bi-metallic and thus should really be called
counterfeit. They violate the
Constitution and law establishing the content and value of a “dollar”. From 1913 with the creation of the Federal
Reserve System, there has been a steady movement to eliminate all references to
actual money from the paper currency issued by that system. Please look at any paper money you have in
your wallets or purses. The heading is
Federal Reserve Note. You can
search every corner and never find that it is “redeemable” in anything, other
than more worthless paper!
In 1913, the Federal Reserve issued paper money
(certificates) which were fully redeemable in gold (until 1934) or silver
(until 1968). These were known as Silver
or Gold Certificates and stated that there was on deposit in the Treasury of
the United States the equivalent amount of the metal stated which could be
delivered to the “bearer on demand”.
Ultimately in 1963, the notation printed on the
Federal Reserve Notes (no longer called “certificates”) was changed to read:
“Legal tender for all debts, public or private.” No longer redeemable in anything.
The banner which now reads, “Federal Reserve Note”!
must be recognized, in legal parlance, to mean it is a promise to pay. It is not money in the true sense since it is
not “convertible” into cash! Try taking
any Federal Reserve Note into a bank and asking for the equivalent amount in
silver for it.
This is why many now say we only have “funny (fiat)
money”! The move from silver and gold to
printing press money has left every citizen with nothing solid or
tangible. But it isn’t funny.
It’s tragic!
That’s my view.
What’s yours? Reach me at constitutionviews@gmail.com
©Copyright 2012
Hillard W. Welch
