New Push in Iowa to Make Gold and Silver Legal Tender

The Arizona Senate passed legislation yesterday that would make gold and silver legal tender in their state.  A similar bill was filed in the Iowa House this week.  House File 346, if passed, would recognize gold and silver coin as legal tender in the state of Iowa.

Some specifics in the bill:

• State banks and credit unions would have to allow gold and silver deposits and withdrawals would also have to be in gold and silver unless it has been converted to another currency.  A separate account would be required.
• No person may be compelled to accept gold and silver coin as legal tender.
• Gold and silver coin would be free from state taxation as legal tender.
• Authorizes the Iowa Department of Commerce to study the creation of gold and silver depositories.

This bill is sponsored by State Representatives Dwayne Alons (R-Hull), Larry Sheets (R-Moulton), Jason Schultz (R-Schelswig), Greg Heartsill (R-Melcher-Dallas), Dave Maxwell (R-Gibson), and Tom Shaw (R-Laurens).

This bill makes sense.  For instance, why are we taxing money?  This bill is also a way for Iowa to invoke monetary federalism and allows Iowans to have a choice over the U.S. Dollar which is rapidly depreciating.  This is also Constitutional.  Article I, Section 10 of the Constitution says that states may not “make anything but gold and silver coin a tender in payment of debts.”  Our founders inserted this provision as a check against federal power to print paper money.

American Principles Project lists some practical effects of legislation similar to HF 346.

• Gold and silver coins are as good as Federal Reserve notes in usage as money.
• In Utah, where the legislation passed in 2011, the state has seen a 50% increase in the amount of gold holdings and the opening of several major vaults.
• Citizens now have a way to save and transact in hard money that will not lose purchasing power.
• Utilizing its constitutional authority a state can give its citizens the full use of an inflation-proof currency.

Former U.S. Senator Jim DeMint (R-SC), now President of the Heritage Foundation, has said that legislation like this “would encourage wider adoption of sound money measures, and  that’s a step in the right direction.”  I agree.  The Iowa House and Iowa Senate should pass this bill.  It will have a low fiscal impact on the state of Iowa and provide more liberty for the citizens of this state.

Photo Credit: Jeremy Schultz via Flickr (CC-By-3.0)