President Franklin D. Roosevelt & American Gold

.. ..Presidents Abraham Lincoln and Franklin Roosevelt revolutionized the monetary system of the United States and set the nation on the road of inflationary plunder that has characterized other nations in history. The actions of these two presidents also provide a textbook example for understanding the animosity and antipathy that government officials historically have had toward precious metals (i.e., gold and silver coin) as a medium of exchange. With the holding in Griswold, the federal government was left with the power to borrow to finance its operations but without the authority to force people to accept its notes at face value for the payment of debts. Thus, the American people could still protect themselves from a profligate government by expressly providing that notes and contracts could be repaid only in money (i.e., gold coin), not in federal promises to repay money. The ultimate solution to this financial chaos, destruction, and morass lies in sound money. The ideal is a free market in money, as the Nobel Prize-winning economist Friedrich A. Hayek observed. The second-best solution is the type of gold standard established by the Framers, where gold and silver coin are the official money and where the federal government is required to redeem all bills and notes in such money. These two powers were not inconsistent with a monetary system based on gold and silver coin. People paid their taxes with their money, which meant gold and silver coins. And if government wished to borrow money from the citizenry, it would issue a promissory note or “bill” promising to pay back the gold coin that it received from the lender. But everyone understood that the actual money was the gold or silver coins, not the promissory notes. The notes simply evidenced the promise to repay the money.. ..

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