VA delegate Robert “Bob” Marshall, representing the crazy parts of Loudon and Prince William Counties, is trying to compel taxpayers to spend up to $22,560 dollars to study an alternative currency for Virginia.
Marshall believes the dollar is on the verge of collapse, and that Virginia must stand ready to issue its own gold coins. “This is a lifeboat study,” he says, akin to studying how much canned food to put in your bunker. It’s been a pet theory of Marshall’s for years, and he just found a way to waste more money and time on it by getting part of the legislature to vote for this “study.”
Such studies will always smack into Article 1, Section 10 of the US Constitution, which says, relevant portions in bold:
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
While there’s some squishiness in the clause, designed to preserve the Federal Government’s rght to print paper money, the charge to the states is perfectly clear: no state shall coin money. 1
Some states have recently considered getting around this by treating US govt issued commemorative coins as money.
The Treasury issues commemorative coins, bearing images of patriotic worthies, for collectors. These are not intended as to circulate as money (and in fact can’t be legal tender) but they are commodities, made of metal, with a demonstrable commodity value and so politicians who yearn for collapse have suggested making them a form of circulating money in Utah and twelve other collapse-curious states 2 They might as well form committees to consider granting titles of nobility.
Marshall of Virginia worries that the value of greenbacks could be destroyed by “hyperinflation.” He notes that “from our nation’s founding, there has been concern regarding the country’s monetary and banking systems and their potential to harm the citizenry,” and that Thomas Jefferson himself “expressed deep concern about the social instability that may ultimately result from bank-issued paper money.”
The key phrase here is “social instability.” The problem with inflation isn’t really rising prices, it’s the fact that social hierarchies are destablizied. Here is the most prominent recent example of “social instability,” one that certainly would have alarmed Jefferson much much more than even the specter of “bank-issued paper money.”
In the past–during the Civil War, for example–Lincoln’s critics routinely compared paper money black men in uniform. Both represented inflation. At the turn of the 19th century, “gold bugs” dismissed recent immigrants as “low wage races,” “silver handling peoples’ who lacked the essential qualities of white citizens.
Marshall stays silent on race questions, but is enthusiastically anti-gay. From his Wikipedia entry:
in 2010, Marshall proposed a bill to “ban gays from openly serving in the Virginia National Guard,” saying “If I needed a blood transfusion and the guy next to me had committed sodomy 14 times in the last month, I’d be worried,” and “It’s a distraction when I’m on the battlefield and have to concentrate on the enemy 600 yards away and I’m worried about this guy who’s got eyes on me.”
Marshall also sponsored the Marshall-Newman Amendment to the state constitution that prohibited same-sex marriage as well as civil unions, domestic partnerships, and “other legal status to which is assigned the rights, benefits, obligations, qualities, or effects of marriage.”
In May 2012, Marshall led a successful effort to defeat the nomination of openly gay prosecutor Tracy Thorne-Begland to a district court judgeship.
Here’s my favorite instance:
has also expressed displeasure at the decision of the Federal Reserve Bank of Richmond‘s decision to fly a gay-pride flag alongside the American flag to celebrate Gay Pride month. Marshall wrote a letter to Jeffrey M. Lacker, president of the bank, urging him to take down the flag
The New York Times described the incident here. “Social instability” for Marshall includes gay people serving in the national guard, circulating their blood and making eyes at you. It include LGBT Americans claiming the right to marry and acquiring the “benefits, qualifications, obligations, qualities or effects of marriage.” It includes gay flags flying at the Federal Reserve, where the money comes from. That’s a form of inflation–their value has risen dramatically. The money is gay. It’s got eyes for you. It wants to transfuse you with gay blood.
I think my argument works partly because there has been no significant inflation. Although the Federal Reserve has created trillions of dollars since 2008, prices haven’t gone up much, if at all. There are zero signs of hyperinflation. People like me, (or Paul Krugman, just to puff myself up) have actually argued that inflation would be good for most Americans, that we want some inflation. But the Fed has been scrupulously careful to prevent it. People who worry about inflation forget that the Fed has the power to destroy money as well as to create it, and it sees preventing inflation as its key job.
But if you point out that prices have not gone up, and that although it’s been five years since Obama’s allegedly inflation-producing stimulus, no inflation has occurred, the response is always that inflation has occurred because there’s more money around. By this definition “inflation” appears to have nothing to do with prices and everything to do with “social instability” and with the wrong kind of people gaining power–black people in the white house, gay flags at the federal reserve. Gay money at Alabama barbecues. Or the fact that, according to Breitbart.Com, one in six of Obama’s fund raisers are gay!
The picture above is at the Breitbart.com link. If you save it, you will see that the partisans at Breitbart.com have titled the image “obama_first_gay_president_money.jpg.” The money is gay because Obama is gay because he’s caught teh gay from gay people.
Marshall’s inflation fears, and his desire for a gold Virginia coin, aren’t really about prices, and they aren’t separable from his homophobia. They are about the wrong kind of people gaining equality, and social position being contaminated. Gold coins won’t stem that tide.
Your author is not especially fond of the Federal Reserve, which he thinks exists to serve the profit margins of large banks above all. Allowing people to print or mint alternative currencies might be a decent idea–I’d consider it. But I know the difference between inflation and apocalyptic fantasy, and I know the difference between changing notions of social hierarchy and higher prices.
Note: thanks to Tracy Fisher for calling Marshall’s bill to my attention
- You could argue that this clause is ignored all the time, because it’s not clear what a “Bill of Credit” might be. That’s on purpose. The men who wrote the Constitution were ambivalent about paper money. And indeed before the Civil War, state chartered banks (but not states) could and did “emit” “bills of credit” in the form of paper money. Today Virginia issues bonds, and in fact enjoys a AAA bond rating: these bonds are on paper, and they amount to a form of credit: hard to see how they are not a “bill of credit” except that VA bonds don’t circulate as money, which is what they kind-of-sort-of-mostly meant when they used the phrase “bills of credit.” ↩
- They are: Georgia, Montana, Missouri, Colorado, Indiana, Iowa, New Hampshire, South Carolina, Tennessee, Washington, Vermont and Oklahoma. ↩