It doesn’t take a genius to read the plain statements of the constitution. Article 1, Section 10:
“No state shall….make anything but gold and silver coin a tender in payment of debts”.
There it is, no need for interpretations, no executive Supreme Court rulings. The constitution said it, the states can’t do it. Why? The Tenth Amendment:
“The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people”.
There is simply no power given to the states to accept anything other than gold and silver coin as tender in payment of debt. Notice there is not one jot or tittle in the Constitution giving power to create “legal tender’ other than gold or silver. It is not ‘delegated” to the United States government, and it IS prohibited to the states.
It must therefore be “reserved to the states” under specific direction of the constitution, as to what will be accepted as tender for payment of debt. Gold and silver coin. Nothing else.
Without getting all involved and technical, let’s assume you were fifteen years old in 1945, and you were lucky enough to get a job which stated that you will receive, as salary, a one ounce gold coin every week, and that salary would not increase as long as you held your job.
Since gold was held arbitrarily at a value of around thirty five dollars an ounce for several years, it might not be such a good deal. Yet if gold were allowed to adjust to market demand, as it finally was allowed to do, your salary, assuming you were healthy and continued to work that long, would equal around fourteen hundred dollars a week on January 1, 2011.
What that means, quite simply, is that no matter how stupid your federal representatives were in debasing the currency, that ounce of gold would compensate for their stupidity.
Of course, had the constitution been honored, the North could not have fought a Civil War for the liberation of slaves, nor maintained the Union, and confederate states could not have fought their war without issuing confederate notes. Further, the North, as victors, could never have continued to enforce their demands on the South except by financing their power with “legal tender”.
The unfortunate consequence of paper as legal tender is that the government, in order to enforce its value, must be able to keep winning against all comers. If it is to keep winning, it must extend its power over the lives and properties of those who are under its jurisdiction.
Every law, every rule, on the part of congress, must follow in pursuit of that goal if paper money as legal tender is to remain successful. Are such laws legal? The Supreme Court ruled in “Miranda vs Arizona” that where rights and immunities are granted by the constitution, there can be no rule-making or legislation to abrogate them.
By what constitutional authority are Federal Reserve Notes printed as “legal tender”?