Concerned about the out-of-control Federal Reserve System and the increasingly unstable fiat dollar managed by the privately owned central bank, lawmakers in Arizona are following in Utah’s footsteps to come up with a potential alternative that protects citizens. Legislation to treat gold and silver as legal tender already sailed through the state Senate in late February, and last week, the Arizona House Financial Institutions Committee voted 4 to 2 to advance the bill as well. Activists are now working hard to keep it moving along.
If the legislation (S.B. 1439) passes through the full state House of Representatives and is signed into law by Republican Gov. Jan Brewer, gold and silver coins would become legal tender within Arizona. That means, among other important changes, that the precious metals would be treated just like debt-based Federal Reserve notes for taxation and regulation purposes. However, unlike fiat dollars, nobody would be forced to accept gold or silver currency.
The bill, which has found strong support among a broad coalition that includes economists and other experts, comes amid widespread public concern surrounding the stability of the U.S. economy and the dollar. Fears about the Federal Reserve gradually turned to outrage following the economic crisis and the central bank’s unprecedented activities, which include conjuring trillions of dollars into existence out of thin air, bailing out foreign banks and its cronies without any oversight, manipulating various markets, and much more.
In an effort to deal with the potential consequences of the Fed’s wild policies — inflation or even hyperinflation, for example — the legislation in Arizona would expand the definition of legal tender. In addition to the fiat Federal Reserve currency purportedly authorized by the U.S. Congress in violation of the Constitution, the bill would also authorize the use of gold and silver coins minted by the federal government as a medium of exchange for the payment of debts and taxes. Other precious-metals specie could also become legal tender if approved by a court ruling.
“Legal tender is money and is not subject to taxation or regulation as property other than money,” the bill states, adding, however, that nobody can compel anyone to accept precious metals against their will outside of contractual obligations. “Notwithstanding any other law, the exchange of one form of legal tender for another does not give rise to liability for any type of tax.” In other words, if the legislation is approved, trading depreciating Federal Reserve notes for gold or silver money would no longer be taxed.
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