Between Expressed Powers and Necessary and Proper there’s certainly enough justification - it relies even less on the Commerce clause.
I think it is less important that our money be a particular commodity than it is that the government lack the power to manipulate its value for its own convenience.
In my opinion, it is clear that the power to "coin money and regulate the value thereof" is to standardize the exchange rates between coins, probably by weight of the metal, but not necessarily. It is also clear that the coins need not be metal, but also that no one could be forced to accept coins other than gold or silver coins.
Thus, they could stamp out wooden nickels, but that wouldn't make them worth anything to anybody, except possibly for payment of federal taxes. As long as we have those, it is only a short hop to rectangular paper "coins". They can do it, but nobody has to accept them.
But since nobody is trying to pay taxes with Bitcoin yet, and the federal government isn't mining them, as far as we know, there is no justification for them to be standardized or otherwise regulated whatsoever. It might arguably be authorized under whatever clause, but it certainly isn't justified.
Nobody has to accept paper money, either. The only thing "legal tender" laws mean is that if you want to use the power of government to enforce debts, then the government gets to say that its job is done when government-declared legal tender has been presented, whether you accept it or not.
If you don't choose to involve the government in your affairs, then legal tender laws don't affect you.
A copper coin worth $20 in todays USD would weight nearly 3 kilograms!
Surely at least paper gold and silver certificates would be a reasonable concession.
It's sort of a bogus loan, with a variable term and zero interest rate, but it's still allowed, and certainly makes things more convenient for a lot of people. And the government can still profit from the seignorage from the mint.
To be fair, this is actually one of the more plausible ones of the various "everything is unconstitutional" myths. At least some of the framers clearly did want to tie the hands of the federal government when it came to making paper money legal tender.
There is good reason for the Constitution to override the status quo of the Articles of Confederation on the subject of minting coinage, but I'm not certain a debate left unresolved regarding paper money is indicative of anything when they did actually agree that a person could be owned, and that was worth 3/5 of a vote. It was either less important than slavery, or more difficult to resolve. I'm inclined to believe the latter.
Before descending into full-on libertarded ranting, let's just say that leaving the matter as ambiguous effectively grants the government license to do whatever it pleases and interpret the ambiguity in favor of that.
Failing to bind the hands of a future Congress is what allowed them to pick up that grenade and pull the pin.
If you're trying to create a limited government, there are ample reasons to dig a deep moat around money, fill it with poisonous snakes and spiders, and line the walls with Dementors.
Why not, if the debate is still valid? These issues weren't so much "resolved" as put aside in favor of more government power or postponed (in the case of slavery, equal protection). The mere fact that the debate is 200 years old is simply more credit to its importance.
The constitution is imperfect (like our government), as it itself acknowledges, and is "correct" only as Lincoln said that it serves a nation "conceived in liberty and dedicated to the proposition that all (men) are created equal".
As someone else once said, don't take refuge in the false security of consensus.
No, it usually means one side lost and can't get over it. Half the country still disagrees with Darwin, it doesn't make the debate important despite it being well over 100 years old. The same applies here.
If you don't think that debate is still important, you are essentially conceding it to the half the country you disagree with (because they sure as hell think its important). I'm sure you don't want your kids being taught creationism just because you consider yourself "above" the argument.
And regardless, the same does not apply here, because unlike the overwhelming evidence we have for evolution by natural selection, there simply is not enough data on the usefulness of central banking to the prosperity of the nation.
No I'm not. The debate was over 100 years ago, the ignorant just haven't figured it out yet. They simply get laughed at now for trying to argue the case. Mockery is not concession.
> there simply is not enough data on the usefulness of central banking to the prosperity of the nation.
Not what I was referring to. I was referring to this, " For better or worse, most of the latent ambiguities in the Constitution were resolved in favor of the interpretation espoused by Hamilton and the Federalists."
You can't ignore 200 years of judicial interpretation and case law simply because you prefer to interpret the text differently, that was his point and he's correct. That debate is over.
If half the population becomes slightly over than half the population out of random chance (or say, the "ignorant" having a few more babies as they are wont to do), mockery would be political concession.
It's far better to convince who you deem ignorant of your own views. This means treating their arguments seriously in the fashion of http://www.paulgraham.com/disagree.html .
Mockery is unlikely to succeed (as are downvotes), and pretty much fails pg's 1st test.
Your next claim, that "200 years of judicial interpretation and case law" ends the debate fails pg's second test. It's an ad hominem attack, that any disagreement with legal precedent (admittedly strong in this case) should be ignored.
By the same token, legal precedent prior to the civil war dictated that human beings could be property. I presume you are glad that some individuals within that society begged to differ.
Debates should be conducted on first principles and supported by objective evidence. I myself agree with Rayiner in that there is no constitutional dictate either way, only saying that the debate is valid on the grounds of 1st principle regardless of how old the arguments are.
Perhaps you should read more of what he wrote, and watch the dozens of debates he conducted with priests, rabbis etc. Of course, you can use ridicule in an argument, but you cannot put yourself above the debate (or you will lose).
If it's actually half the country, and they actually think it's substantially more important than the other half the country, there's an argument that it's effective concession. But, at the risk of putting words in your mouth, I more understood you to be saying that having the argument wasn't important - conveying the understanding behind your "your side" of that argument you might consider quite a bit more important.
On hearing that, it becomes obvious. There is no quest for truth or spirit of inquiry in the opposition. They are simply obstacles to progress that must be routed around. The debate is not over; it never took place, and it never will.
If you can't get someone to support rational argumentation by means of rational arguments, you're better off talking to someone--anyone--else.
Unfortunately that's basically false.
Isn't it good for persons with dollar-denominated debt exceeding their dollar-denominated assets?
When you print an additional 2% of the money supply, you are essentially taking about 2% of the entire economy and assigning it to yourself.
Back when money was gold, and gold was money, in order to increase the money supply by 2%, you had to mine 2% of all gold already in the marketplace, which required a lot of labor and capital. If the price of gold was high, you worked more expensive mines. If it was low, you idled them as temporarily unprofitable. The effect of the increase on the money supply was diffused throughout the economy by virtue of the sheer amount of work required to accomplish it.
With paper money, all that is required is a press and anti-counterfeiting measures. The transfer of value into the new money is far more concentrated, both in terms of actors and time. The buying power of the new money is higher, because people don't necessarily know how much you printed until you start spending it.
It is a great virtue for Bitcoin to make public the exact amount of new money added to the economy. Monetary inflation can therefore be predicted exactly. It's still inflationary, and does not account for changes in demand to achieve a stable money price. What it needs is a feedback loop that connects mining rewards with demand for the currency. I imagine that could key from the hash rate of the whole network, but I'm not certain how.
There is no basis for the assumptions about demand for money vs. other goods that are necessary for this to be a justifiable claim.
Assumption: The money itself has zero intrinsic value. It is only worth what you can trade for it. Thanks to the previous assumption, that is a fraction of all goods and services on the market.
When you change the size of the money supply from 100 to 102, the 2 new notes increase in value from 0 to 1/102 of everything on the market, and all of the 100 old notes decrease from 1/100 to 1/102 of everything. The guy that prints the new notes gets 2/102 of everything for free. That value is not created; it is taken. Everyone who held any old note has their buying power reduced by 1.96%.
Is it justifiable? Yes. Is it a gross simplification because economics is a dismal, dismal science? Also yes.
People are totally allowed to make their own money and you can use it as you like.
EDIT: About the commerce clause.
Forgot to mention, if you want to bag on the federal government, don't bag on the commerce clause, bag on stipulating federal funding is only available if you do this completely unrelated thing.
"If you handle more medicaid people we will cover part of the cost", that makes sense. "If you raise your minimum drinking age to 21 we will help pay for your roads". WTF?
I think it would be completely warranted to have a constitutional amendment that controls how the federal government manages the treasury. It should not be giving money to the states except by apportioning the funds by census populations. If the Wisconsin drinking age is 18, too bad. As long as you are paying for highways at all, you have to pay them 1.817% of that money, because they have 1.817% of the US population.
That would prevent an awful lot of political lever-pulling in the form that you mentioned. You couldn't tie federal highway funding to anything other than the actual upkeep of the highways. And you couldn't make school lunch subsidies contingent on serving corn at least 3 times per week, or declare ketchup a vegetable.
Revisionism. The word "regulate" was interpreted in more or less its modern sense in Gibbons v Ogden, in 1824, merely 35 years after ratification.
"[T]he power to regulate; that is, to prescribe the rule by which commerce is to be governed. This power, like all others vested in Congress, is complete in itself, may be exercised to its utmost extent, and acknowledges no limitations, other than are prescribed in the Constitution."
This is not a case where the meaning of the word has drifted from what it meant at the time of the founding. I'm quite conservative in my Constitutional interpretation, but I think conservatives get the Commerce Clause wrong. Its broad and was intended to be. The anti-federalist framers thought the "interstate" part would be a limit, but didn't concieve of a world where every transaction would cross state borders. Indeed, they lived in a world where market transactions were the exception. But saying that we should interpret the plain text more narrowly because the world has changed since then is a very "living Constitution" thing to do.
I would certainly include defining a singular version to be under the power granted by standardize. Heck most standards are singular in nature. That isn't a stretch at all.
> so Delaware couldn't charge a $1 tariff on a widget imported from New Jersey and two bits on the same thing from Pennsylvania
We are talking about minting coins, not interstate taxes.
> It should not be giving money to the states except by apportioning the funds by census populations.
That only works for some very basic things. Maybe roads (I doubt it) and certainly not a lot of things such as National Forests.
> declare ketchup a vegetable.
Vegetables in school lunches are measured exclusively by volume, not by nutritional content. Most of the tomato jokes are related to concentrated versions that get a pass because serving a kid a cup of ketchup or tomato sauce is silly.
"...make any Thing but gold and silver Coin a Tender in Payment of Debts... " means states cannot issue their own currencies as legal tender. They can only make gold or silver legal tenders for debts. The federal government can make paper dollars a legal tender, and the states can pay their debts in that.
It would be nice to think that the supremes would strike down legal tender laws for that reason, but as they are paid in paper, I don't think it likely in this millennium.
The power to emit debt instruments, including in the form of paper money, is, to the extent it is not included in the power to coin money and regulate its value (Art. I, Sec. 8, cl. 5) a necessary part of the power to borrow (Art. I, Sec. 8, cl. 3). See, inter alia, Juilliard v. Greenman, 110 U.S. 421.
The power to borrow is to write a promissory note in exchange for a real something, that is later redeemable by giving real somethings to the holder of the note. I can write a note promising to pay a hamburger and a half on Tuesday for a hamburger today. In order for that note to have any sort of economic effect, someone has to give me a hamburger for it.
Once it's out there, that's worth 1.5 burgers, and can be traded around at will, but come Tuesday, I need to have 1.5 hamburgers on hand to redeem the note.
The paper money notes now circulating in the economy have nothing to do with borrowing. Where is the promise to pay? What is the term of the loan? Why is the US paying the Fed interest to take and use their note?
If it were borrowing, the Treasury would print the notes and give them to the Fed in exchange for something. Those are T-bills. The something they get in return is Fed scrip. That is what circulates. That is what they made into legal tender. Do you buy groceries with T-bills? US notes? Gold or silver certificates? No? The federal power to borrow does not apply here. You are not exchanging federal instruments, but notes issued by a private (but legislatively controlled) banking system.
If you contract to be paid only in federal coins or instruments, and someone pays you in private bank notes created from thin air instead, the courts will not decide in your favor.
Technically, they shouldn't be accepting Federal Reserve Notes as payment for any state taxes, including sales taxes.
Note that this clause does not authorize the federal government to declare a legal tender or issue paper money; it simply prohibits the states from doing those things. Thanks to the 10th Amendment, those are reserved exclusively to the people. The wording is a bit tortured, but a logical parse is that powers not delegated to the federation are reserved to the states, and that powers prohibited to the states are reserved to the people. Legal tender, and paper money are not delegated to the federation, but prohibited to the states, therefore they remain the province of the people.
There should be no problem with the Federal Reserve printing its own notes, but there's no way in hell that making them legal tender or accepting them for payment on state or federal debts is constitutional. They do it anyway. Hardly anyone cares. Those who do are ignored.
As usual, they will do as they please, damn the consequences, and hang it all up under the interstate commerce clause.
Edit: Article I, section 8, clause 5 does give the federation the power to coin money and standardize its value. It still doesn't give them the power to accept those coins as payment for debts unless they are gold or silver.