(Jackson Hole, WY) Last Friday former U.S. Senator Jim DeMint (R-SC), who is currently the President of the Heritage Foundation, was the keynote speaker during the banquet following the general session of the Jackson Hole Summit. The Jackson Hole Summit was billed as the counter conference to the annual symposium hosted by the Federal Reserve Bank of Kansas City also being held in Jackson Hole as a protest to the failed monetary policy implemented by the Federal Reserve.
“I believe that America’s monetary system is the Achilles heel of the greatest nation in history and the world’s economic system,” DeMint told the group of approximately 150.
“We all know that there is something seriously wrong when trillions of new dollars are created out of thin air to bail out big banks, stimulate the economy and buy government debt. And something is dangerously wrong when the political and media class are even afraid to discuss it,” DeMint added.
DeMint said that monetary policy must be presented in a way that most Americans will understand. He stated we need to answer the question, “what is money?”
“Money works as a market, or at least it should. Money is a proxy for something of value. If sellers have a product that is in high demand and short supply, the perceived value of the product increases and the seller can require more money from buyers. On the other hand, if there is an oversupply of a product and soft demand, the perceived value of the product declines and the amount of money required for a trade will decline significantly. In a free market, the dollar price of products and services changes based on supply and demand – based on how we perceive the value of goods and services. This dynamic is good and healthy for our economy. But when the actual value of money is altered by a central committee in Washington it is not healthy… in fact, it can be dangerous,” DeMint stated.
DeMint referred to Leviticus 19:35-36 where God commanded the Israelites to use honest weights and measures. It reads, “You shall do no wrong in judgment, in measures of length or weight or quantity. You shall have just balances, just weights, a just ephah, and a just hin: I am the LORD your God, who brought you out of the land of Egypt,” (ESV).
“When a customer in ancient times put a pound of grain on the scale, he had a right to expect an honest weight on the other side of the scale to confirm its value. That’s what our money is supposed to be: an honest standard to measure value – not something a government agency creates out of thin air because it doesn’t like the unemployment rate or because the Treasury wants to bail out banks,” DeMint explained.
DeMint said that no candidate for President, if they are serious, should avoid the topic of monetary policy. “Centralization of monetary and financial power can be just as damaging to our freedoms as centralization of political power—and just as allergic to sunlight,” DeMint said. “It creates the perception among Americans that their economic futures are out of their control. Unfortunately, this perception is increasingly accurate.”
He points out how the bitcoin phenomenon to address the centralization of money has been met with calls for government regulation and oversight. He said every new advance frightens people to the top, like how the advent of email was challenged by the U.S. Post Office. DeMint reminded the audience of their attempt to convince President Ronald Reagan that this new system should be managed by them.
He said they were laughed out of the room. He noted the fight to decentralize money has other parallels to the U.S. Postal Service.
In the 1840s, early libertarian and abolitionist Lysander Spooner was outraged at the high price of US Mail delivery—it cost almost as much to send a letter as to ship a barrel of goods in freight. So he decided to start some competition. He founded the American Letter Mail Company and vastly undercut the high price of stamps.
It worked; so, naturally, official Washington brought suits against him as a criminal.
The government tried to forbid railroads from carrying mail for private companies, but the courts disagreed. So Congress and the Postmaster General engaged in a price war with Spooner. This was great news for the American people.
DeMint says when the U.S. Postal Service is finally “laid to rest” (to loud applause) the last stamp should have the face of Lysander Spooner.
“It just shows that it is possible to compete with a government monopoly and improve the lives of your fellow citizens. It is possible to look past the mountain,” DeMint said. “I do not know whether the climb ahead of us stops at a rules-based monetary system, or leads to an entire re-examination of Reserve banking. I do not know whether our money will only be valued as a reflection of our economic power, or tied to a commodity only King Midas could inflate.”