A Return To Gold

Utah legalizes use of gold, silver as currency

By Kase Wickman
Monday, May 23, 2011 10:03 EDT

 

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Utah this week became the first state to legalize the use of gold and silver coins as legal currency, the according to the Associated Press.

Republican state Rep. Brad Galvez sponsored the bill, which also excludes gold and silver from capital gains taxes, as a protest against Federal Reserve policies. Galvez said he didn’t want a complete return to the gold standard, but wanted to give consumers more options.

“We’re too far down the road to go back to the gold standard,” Galvez told the AP. “This will move us toward an alternative currency.”

The Utah Gold and Silver Depository will open June 1, and consumers will be able to store their gold coins there in exchange for a debit card that draws on their funds there. Merchants won’t be required to accept gold coins, so the depository is the only way to guarantee the currency can be used.

Idaho, Minnesota, North Carolina and at least nine other states have similar bills drafted. Minnesota was the only state already considering the legislation.

Republican presidential candidate and former Minnesota Governor Tim Pawlenty made remarks in late March that implied he’d like to see a return to the gold standard. He told Fox News’ Sean Hannity that the recession would continue because the government had injected “fiat money” into the economy.

“It may look like there is temporary improvement because they have artificially infused the economy with government money, but the consequences of that will, as sure as we’re sitting here, will rear its head,” Pawlenty said, according to The Hill.

The Economist pointed out the flaws in the gold standard system, namely that it was partly due to lack of regulation on gold conversion rates that the country fell victim to the Great Depression. Gold and silver were prohibited by President Franklin Roosevelt from being used as currency during the Great Depression to prevent hoarding. President Richard Nixon formally and fully terminated the gold standard in 1971.

American Principles in Action, a DC-based conservative non-profit policy group that strongly supports a return to the gold standard, helped shape Utah’s new legislation. APIA economics project director Ralph Danker said that the gold standard would up consumers’ confidence and send a strong message to the Federal Reserve.

“Making gold and silver coins legal tender sends a strong signal to Congress and the Federal Reserve that their monetary policy is failing,” Danker told the AP. “The dollar should be backed by gold and silver, so we have hard money.”

Arizona May Legalize Gold/Silver As Legal Tender

Arizona returning to gold rush roots with bill making gold legal tender

Published May 01, 2013

Associated Press

Ed. Note: Gold Value is real, Paper Money value is imaginary and fluctuates far more than metals.
More Facts Here: http://www.bloomberg.com/news/2013-04-08/trust-in-gold-not-bernanke-as-u-s-states-promote-bullion.html

Arizona is returning to its gold rush roots with a bill that would make precious metals legal currency.

The GOP-led Senate gave final approval Tuesday to the bill that could make Arizona the second state in the nation to recognize gold and silver as legal tender. If signed into law by Gov. Jan Brewer, the measure would take effect in 2014.

The state Department of Revenue opposed the measure. It passed in the House only after an amendment was added to exempt the department from having to accept gold or silver as tax payments.

The measure reflects a growing distrust of government-backed money amid the declining value of the dollar, according to proponents. Republican Rep. David Livingston of Peoria, a financial adviser who ushered the legislation through the House, said his clients were eager to tap into their gold and silver reserves.

But Democrats, who voted against the measure in the Senate and House, said it sends a false message to constituents that gold and silver are safer than traditional currency.

"This is too extreme," Democratic Sen. Steve Gallardo of Phoenix said. "We don't need it."

Democratic Sen. Steve Farley of Tucson said the measure is unnecessary and would create long lines at businesses as store clerks inspect and weigh the gold and silver. The measure would allow the use of precious metals as money only when businesses agree to take them.

"Businesses are not clamoring for this, to say the least," Farley said. "This is basically growing the size and scope of government to create an entirely new currency system."

Farley noted that the price of gold saw a significant drop in early April, its biggest one-day plunge since 1983. He said allowing gold and silver as legal payment at grocery stores and other businesses would prove too unpredictable.

"Anybody who thinks gold or silver is a safe place to put your money had better think again," he said.

The Senate had previously passed Senate Bill 1439, but it was sent back for final approval after the House amendment passed.

Utah became the first state to allow gold or silver payments in 2011. Lawmakers in Minnesota, North Carolina, Idaho, South Carolina, Colorado and other states have debated copycat laws in recent years. The Maine Senate and House recently rejected a similar measure.

Gold-backed money fell out of favor during World War I because the U.S. and many other countries needed to print more cash to pay for the war. President Richard Nixon formally abandoned the gold standard in 1971.