The Congress and Your Gold

What an astonishing set of issues has been opened up with the announcement yesterday by Congressman Anthony Weiner that he will hold a hearing on what he calls “TV Gold Dealers.” The congressman put out on his Web site yesterday a statement that makes the hearing seem like it will prepare a Weinerian form of a bill of attainder against Goldline International and Glenn Beck. Goldline is a dealer that Mr. Weiner characterized as using “conservative spokespeople like Fox News’ Glenn Beck to sell overpriced gold coins.”

It seems that one of the advantages perceived in respect of gold coins, as opposed to bullion, is that they would be less likely to be confiscated were the government to try in the current economic crisis, when the value of the dollar has collapsed to less than a 1,200th of an ounce of gold, to confiscate gold the way another Democratic administration, FDR’s, did during the Great Depression. Mr. Weiner seems to think that worrying about another Great Depression should be illegal.

One of the things Mr. Weiner’s bill would seek to do is prevent gold companies from hiding behind “false promises of profitablility.” The measure would require what Mr. Weiner calls “companies like Goldline” to “disclose the reasonable resale value of items being sold.” To which Ira Stoll, on the Website Futureofcapitalism.com, retorts: “Are Mr. Weiner and Chairman Bernanke also going to agree to print on every dollar the reasonable expectation that its value will be eroded by inflation?”

As Mr. Weiner was putting the announcement of his gold hearing up on his Web site, the former chairman of the Federal Reserve Board, Alan Greenspan, was over at the Council on Foreign Relations warning that “fiat money has no place to go but gold.” Our editorial yesterday quoted Mr. Greenspan: “If all currencies are moving up or down together, the question is: relative to what? Gold is the canary in the coal mine. It signals problems with respect to currency markets. Central banks should pay attention to it.”

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And so should the Congress. In this sense there is buried in Mr. Weiner’s campaign to scare people away from gold at least the glint of constitutional bedrock. For one of the basic enumerated powers of the Congress is “To coin Money, regulate the Value thereof, and of foreign Coin . . .” The congress has been in default in respect of this responsibility for decades now. The institution to which it has delegated its powers, the Federal Reserve, is issuing scrip in which people are losing confidence. With the value of the dollar at below a 1,200th of an ounce of gold, no wonder there is a clamor for a new monetary system — and, in some quarters, even for the states to use their constitutional power to make gold and silver coin legal tender. The thing to remember about this story as it unfolds is that it’s not about Goldline’s marketing techniques or Glenn Beck’s responsibilities. It’s about Congress’s responsibilities under the most fundamental law of our land.