Want to stop deficit spending? Shut off the Fed’s printing presses because at this point, the Fed is buying most federal debt with dollars it printed up in the basement. The simple act of requiring money to be real would mean the presses would stop, since nothing with “real” value comes off a printing press. The federal government would have to stop most of its deficit-spending.
In pursuit of this admirable and worthy goal, America’s Tea Party-minded Senators continue to press the issues that are vital to getting America working again and reining in a hyperactive federal government. This first step towards the re-monetization of precious metals would allow Americans to accumulate wealth (“save,” remember that?) in physical gold and silver without the tax man debilitating their savings or the Fed printing away their value. In the history books, you can find references to this primitive practice, otherwise known as “capital formation.”
From The Hill:
- Sens. Jim DeMint (R-S.C.), Mike Lee (R-Utah) and Rand Paul (R-Ky.) this week introduced legislation that would exempt gold and silver coins declared by the federal or any state government as legal tender from taxation.
The Sound Money Promotion Act, S. 1287, is meant to build on what the sponsors see as a reaction to overspending by the federal government and the falling value of the dollar. The senators said that in May, Utah became the first state to recognize these coins as legal tender within the state, and said 12 other states, including South Carolina, are considering similar measures.
From Senator DeMint’s site:
- “Thanks to the government’s reckless over-spending, continued bailouts, and the Federal Reserve’s easy money policy, this year the purchasing power of the dollar hit an all-time low in the several decades since we went off the gold standard,” said Senator DeMint. “In order to rebuild strength and confidence in our economy, we need both the fiscal discipline to cut wasteful spending and the monetary discipline to restrain further destructive monetizing of our debt. This legislation would encourage wider adoption of sound money measures, and that’s a step in the right direction.”
From Senator Lee’s site:
- “Good monetary policy is an important part of a healthy and prosperous economy,” said Senator Lee. “Since the Federal Reserve Act of 1913, the dollar has lost approximately 98 percent of its value. This bill is an important step towards a stable and sound currency whose value is protected from the Fed’s printing press.”
The warning signs for our economic problems can no longer be ignored:
While the value of a dollar is at historic lows, the value of gold is at historic highs
Recently Standard & Poor’s downgraded the U.S. outlook from “stable” to “negative,” meaning there is a 1 in 3 chance of an actual credit downgrade in the next two years
The world’s largest bond fund [PIMCO] has dumped its U.S. debt-related holdings, over concerns that we will not get our fiscal house in order
The Federal Reserve is now buying 70 percent of U.S. Treasuries, set to surpass the holdings of both China and Japan combined
Meanwhile, from Senator Webb’s site:
- On June 29, U.S. Senators Jim Webb and Mark R. Warner introduced legislation that would establish a unit of the National Park Service (NPS) at Fort Monroe in Hampton, Virginia.
We obviously need to replace Webb with someone who is more Tea Party-minded. Warner can be next.