Constitutional Currency

Very few Americans understand how the Constitution defines “dollars” or the constitutionally delegated monetary powers and prohibitions to Congress and the States. As a result, Americans take many unlawful monetary policies for granted, because they have known nothing different and have not questioned the national government’s authority to do the things it has done.

Every American should question if the government has the authority to emit a legal-tender paper currency irredeemable in silver or gold coin. If they have the authority to seize the people’s gold like the FDR administration did in 1933. If they are authorized to make the notes of private banks obligations of the United States and legal tender or allow private banks, through an administrative agency exercising unlimited discretion, to draw money from the Treasury without specific appropriations made by law.[1]

The answers to these questions are laid out in seven constitutional clauses that define “Money” and the powers both delegated to and prohibited from the national and State governments in regards to monetary policy. These seven clauses are the standard by which every act of Congress and State law, dealing with monetary policy, must be measured.

Four of the seven clauses define the monetary powers delegated to Congress. “The Congress shall have Power…To borrow Money on the credit of the United States;[2]… To coin Money, regulate the Value thereof, and of foreign Coin,[3]…To provide for the Punishment of counterfeiting the Securities and current Coin of the United States[.][4]”“No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law[.]”[5]

The first two clauses of the four only authorize Congress to borrow, coin, and regulate the value of “Money”. The third clause requires Congress to provide for the “Punishment” of counterfeiters, and the last clause limits the reason for which money can be drawn from the US Treasury.

Only one clause of the seven defines the monetary powers prohibited to the State governments. “No State shall…emit Bills of Credit; [or] make any Thing but gold and silver Coin a Tender in Payment of Debts[.]”[6]

Finally, two clauses of the seven specifically refer to “dollars”, “…not exceeding ten dollars for each Person.”[7] “…where the value in controversy shall exceed twenty dollars;”[8]  thereby using a term that had a definite meaning to everyone who both framed and ratified the US Constitution.

It is in constitutionally defining the term “dollars” that will unravel much confusion modern Americans have about the constitutional monetary system and it will help decipher the other five constitutional monetary clauses.

The dollar, as referred to in Article I, Section 9, Clause 1 and the Seventh Amendment, is a “Money Unit” defined by specific grains of fine silver equivalent to “New Spanish Dollars” in 1786. We know this because in 1785, Congress “Resolved, That the money unit of the United States of America be one dollar.”[9] Then, “[i]n 1786, the Congressional Board of Treasury…calculated that “[t]he Money Unit or Dollar will contain three hundred and seventy five grains and sixty four hundredths of a Grain of fine Silver”, and will be worth as much as the New Spanish Dollars.”[10]

Further evidence is found in the Coinage Act of 1792, in which it fixed the grains of silver in the dollar to 371-1/4 grains of fine silver. The adjustment in the amount of silver was to more accurately equate the US dollar to the value of a Spanish milled dollar as the same as was then in existence. The Coinage Act also defined the amount of gold in American gold coins relative to the dollar; i.e., equal to the value of a silver coin with 371-1/4 grains of fine silver.

By these national government actions and because everyone who ratified the Constitution understood the meaning of “dollars” as used in the Constitution, a dollar is statutorily fixed, by the Constitution, as being a silver coin comprised of a specific number of grains of fine silver “worth as much as the New Spanish Dollars”, which the Coinage Act of 1792 fixed at 371-1/4 grains of fine silver.

This is significant because it is the standard of value by which the national government must maintain and measure all other “Thing[s]” with respect to monetary value. They are no more able to redefine what constitutes a “dollar[ ]” than they are able to redefine the length of a “year”. Both terms are used by the Constitution and both have very specific meanings. The Coinage Act of 1792 more precisely defined the dollar in relation to milled Spanish dollars and any other adjustments would not serve to improve the standard unit of United States “Money.”

“Money” as defined by the Constitution also has a very specific meaning. We know from the monetary powers delegated to Congress that “Money” had to be coined, therefore it had to be made of metal and as pursuant to common law, upon which the Constitution was based, it had to be of intrinsic value.[11]

From the monetary prohibitions placed upon the States we see, that both gold and silver were meant to comprise the coinage system in the United States, which also comports with common law from which the framers of the Constitution developed the monetary clauses. Constitutional “Money” is gold or silver coin whose value is measured against a silver coin of 371-1/4 grains of fine silver. Copper may also be used as “Money”, because it is a semi-precious metal, but its value must be measured against the silver dollar as defined above.

This brings us back to the questions Americans should ask about the government’s monetary policies. Since the Tenth Amendment specifies that Congress is only allowed to exercise authority where it is specifically written in the Constitution, it should be clear that Congress can only borrow, coin, and regulate the value of coins in relation to the silver dollar standard. They are also obligated to provide for the punishment of counterfeiters. Conversely, they are prohibited from making any other monetary policy to include emitting paper currency of any kind as legal tender, withdrawing money from the US Treasury without “Appropriations made by Law”, or allowing surrogates to do the things they are prohibited from doing, because it is not written in the Constitution.

The national government is also not authorized to confiscate the property of American citizens without due process of common law. Unfortunately, they have done all of these things and are still currently doing most of them.

The only thing that is stopping us from demanding our national government uphold our Constitution is us. Nobody but politicians and their friends are benefiting from our current monetary system, and most importantly, to do anything else other than to uphold the Constitution is contrary to the “supreme Law of the Land.” Restoring the constitutional monetary system should at least be one issue upon which most all Americans can agree, because it will benefit everyone except those who have an unlawful financial interest in the current system.

[1] E. Vieira, Jr., Pieces of Eight, p38.

[2] Article I Section 8 Clause 2

[3] Article I Section 8 Clause 5

[4] Article I Section 8 Clause 6

[5] Article I Section 9 Clause 7

[6] Article I Section 10 Clause 1

[7] Article I Section 9 Clause 1

[8] Amendment VII

[9] 29 Journals of the Continental Congress, ante note 331, at 499-500.

[10] E. Vieira, Jr., Pieces of Eight, p89.

[11] E. Vieira, Jr., Pieces of Eight, p69.


3 thoughts on “Constitutional Currency

  1. “Give me control of a nation’s money supply, and I care not who makes its laws.” Mayer Amschel Rothschild (alleged)

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