patrick.net

I don't get it. How is the Coinage Act defining a "constitutional" dollar any more than any other arbitrary definition? The coinage act wasn't a constitutional amendment, it was simply a federal law. The constitution says very little about money, other than empowering congress to print and regulate its value.

Yes, historically money was valued in terms of fixed weights of silver. What does that have to do with being "constitutional"?

I'll entertain the notion that the US will go back on a metal standard one day (after all, anything can happen after the Rapture). There's absolutely no reason to think that whatever definition is used will have any relation to any definition used in the past, or even that it will use a metal that has been used in the past.

Didn't we go over this already? A dollar is a unitless measurement of currency with only vague mention and no definition in the Constitution.

It was originally designed to be identical to the common solid global currency of the day, the Spanish dollar. Over time the dollar has been morphed into various forms as commercial requirements of being initially a continental and eventually hegemonic global trading power evolved.

As Kevin mentions above, contrary to your article, the Coinage Act of 1792 is not of "Constitutional" basis, it is/was law in keeping with the Congress' constitutional powers of regulating the nation's money.

This is a pretty major misunderstanding.

I swear wingnuts are the stupidest people on the planet. Our government should go on the Aluminum standard so you'd get some (perceived) direct utility out of our currency.

The 7th Ammendment and Article 1, Section 9, Clause 1 of the Constitution both refer to a "dollar." At that time no definition of a dollar was necessary because anyone who knew economics and trade knew that a dollar was a reference to the Spanish coin of a specified weight and purity of silver.

The fact that the dollar was recognized as a specific amount and purity of silver cannot be denied by any but the most self-deluded.

AdHominem says

The 7th Ammendment and Article 1, Section 9, Clause 1 of the Constitution both refer to a “dollar.” At that time no definition of a dollar was necessary because anyone who knew economics and trade knew that a dollar was a reference to the Spanish coin of a specified weight and purity of silver.

Ah, the 7th amendment (and article 1) was written before the coinage act, and in fact the term "dollar" as mentioned did refer to spanish dollars. It was a poor choice of words to put absurd values like "10 dollars" and "20 dollars" into the constitution, particularly since it doesn't say WHAT a dollar is, but that just proves that the constitution was written by flawed human beings and is a flawed document.

It still doesn't give a "constitutional" value for a dollar.

The fact that the dollar was recognized as an specific amount and purity of silver cannot be denied by any but the most self-deluded.

I don't think anyone is denying that the dollar *WAS* recognized as a specific amount of silver (in 1792)...

What we're saying is that this doesn't make it "constitutional".

The only thing that makes something constitutional (or unconstitutional) is being written in the constitution. Nowhere in the constitution does it say what the value of a dollar is, nor should it -- that was the job of congress. In 1792, Congress chose to make the value of a US dollar equal to that of a spanish dollar, because at the time it was the standard. This was a reasonable solution in 1792, but it isn't 1792 anymore.

If you want a great example of how horrible a constitution can be if you try to put every law into it, rather than using it as a basic framework for creating law, look at California.

For all the talk about the supposed harm caused by fiat currency, I still see a world around me that is, as a whole, vastly superior to any time in history that we didn't use fiat currency. All major economies use fiat currencies, and, recent troubles notwithstanding, things are OK.

You want to argue semantics rather than accept the facts.

Congress cannot change the meaning of the words in the constitution without making a mockery of the constitution, and you know this. For example, the constitution also talks about a "year" but does not stipulate that it is 365 days. So by your reasoning congress could determine (change) the meaning of the word year to mean 40 days and we could "constitutionally" elect a new president every 160 days. You have strayed into the realm of absurdity with your argument.

Anyone who fails to recognize that our country was founded on the understanding that a dollar was a specific amount and purity of silver is deluded.

AdHominem says

Anyone who fails to recognize that our country was founded on the understanding that a dollar was a specific amount and purity of silver is deluded.

Congress has the power to regulate it. I agree that the usage of "dollar" is vague and the power to "coin money" implies hard currency. But you're the one reading meaning into the Constitution that simply isn't there.

I understand that rich people and goldbugs want to handicap the Congress' power to debase our currency as they have over the past 100 years. Good luck with that.

I'll buy that for a dollar!

U.S. Dollar = Federal Reserve Note ... a promise to pay a promise backed by a promise.

Bubble Yum cost 25c back in the 1970s.

Now it costs 50c from amazon.

Oh noes teh inflation.

AdHominem says

You want to argue semantics rather than accept the facts.
Congress cannot change the meaning of the words in the constitution without making a mockery of the constitution, and you know this. For example, the constitution also talks about a “year” but does not stipulate that it is 365 days. So by your reasoning congress could determine (change) the meaning of the word year to mean 40 days and we could “constitutionally” elect a new president every 160 days. You have strayed into the realm of absurdity with your argument.
Anyone who fails to recognize that our country was founded on the understanding that a dollar was a specific amount and purity of silver is deluded.

Again, you still don't get it.

The constitution *does* give congress the power to assign value to a dollar, it does *NOT* specify what that value is. This was completely intentional. If the value of a "dollar" was some fundamental near constant (like the orbital period of the earth), then there would have been no need to give congress the power to regulate the value of currency.

No one is arguing the "value" of the dollar except you. This article is merely meant to educate the misinformed about what a dollar physically is. And what it physically is is a specific amount and purity of silver.

AdHominem says

And what it physically is is a specific amount and purity of silver.

Better talk to Honest Abe about that:

Honest Abe says

What has NO definition what-so-ever, anywhere, is what a dollar is. There is no statute, rule, law, or regulation that defines just exactly what a dollar is. That in itself is dishonest, wouldn’t you agree?

Troy says:
Bubble Yum cost 25c back in the 1970s. Now it costs 50c from amazon. Oh noes teh inflation.

LOL. i can haz BUBBL YUM?!?

Kevin nailed it. Had there been a constant definition in the Constitution, there would have been no need for a subsequent coinage act. And since that Act was merely legislative and not a constitutional amendment, any subsequent currency acts have identical validity to the 1792 law.

I don't know if they make silver foil. Howfore thence to make mine tricorn hat? ;o

AdHominem says

No one is arguing the “value” of the dollar except you. This article is merely meant to educate the misinformed about what a dollar physically is. And what it physically is is a specific amount and purity of silver.

The constitution certainly doesn't define any physical form of a dollar either. If congress decided that "a dollar" was "one banana peel", then that's what a dollar would be. The first official definition of a dollar came from the coinage act, but subsequent coinage acts and other laws changed the definition. This is within congress rights (and, as much as we might disagree with it, it was within their rights to create the fed to delegate that power to).

Why do you hate the constitution?

Kevin says

f congress decided that “a dollar” was “one banana peel”, then that’s what a dollar would be.

Why must you mangle and change the meaning of words in order to support your twisted ideas?

By your account congress can decide that a year is 40 days and that a dog is a person/citizen eligible to vote (if they are 18 years of age, which means of course 720 days old since a year is now 40 days).

Nomograph says

AdHominem says

No one is arguing the “value” of the dollar except you. This article is merely meant to educate the misinformed about what a dollar physically is. And what it physically is is a specific amount and purity of silver.

Incorrect. That is what you wish it was. A dollar is simply an medium to allow for the convenient exchange of goods and services. Silver has no bearing on the exchange of goods and services.

Wrong again. A dollar is a dollar. Orwellian style government may try to change the meaning of words but that doesn't change what the meaning of IS is.

A dollar was a piece of silver of a certain quantity and purity. And a dollar IS a piece of silver of that same certain quantity and purity.

Congress can no more change that than they can change what how many feet in a yard.

The Dollar (specific amount and purity of silver) is just a yardstick. Congress has no authority to change the yardstick.

Its authority to regulate the value of the dollar was with respect to how the dollar could be exchanged for other currencies (foreign and domestic). For example the congress does have the authority to set the exchange rate between gold and silver or between coins from our country and coins of another country.

You would have to be a fool to think that our constitution gives congress the authority to change the yardstick let alone to argue that changing the yardstick is a good thing.

AdHominem says

The Dollar (specific amount and purity of silver) is just a yardstick. Congress has no authority to change the yardstick.

you're literally insane, beyond reach of fact or reason. This will be my last post to patrick.net. Thanks all.

Troy, thanks for your input, we'll miss you, but please, PLEASE take Elliemae with you.

P.S. perhaps AdHominem was trying to point out that the dollar had a specific definition in the past. It was defined as a certain weight of gold or silver. Today the dollar has NO definition. That in itself is dishonest. Inagine if each gas station dispensed a certain number of gallons of gas for a specific price BUT each sation had its own defination of what a "gallon" was??? In the absence of a standard for weights and measures there is chaos...and dishonesty.

There is no law or statute anywhere in America that describes what a dollar is. Maybe that's what the original question was..."What is a dollar"?

Gold standard? What about silver?

We could have gold coins but still have fractional reserve lending, ZIRP, zero reserve requirements, and Enron accounting.

What if we had a gold / silver standard, "backing" a paper currency, like America had prior to 1964, AND eliminated fractional reserve banking, zero reserve requirements and Enron accounting? Abe.

A lot of paper rich would suddenly be brought low. Fincial sector would be returned to a normal parasitic size not the giant that it is. Odds of Goldman Sachs allowing this.... ZERO!

Honest Abe says

Troy, thanks for your input, we’ll miss you, but please, PLEASE take Elliemae with you.

I'm not going anywhere. But congrats for driving away yet another poster. I'll bet you're a blast at parties.

Vicente says

Gold standard? What about silver?
We could have gold coins but still have fractional reserve lending, ZIRP, zero reserve requirements, and Enron accounting.

We can make fractional reserve lending illegal as well. Have you ever seen the way they regulate casinos? The government makes sure they have cash on hand for their chips in circulation. I've never heard of a casino run.

AdHominem says

By your account congress can decide that a year is 40 days

Indeed, they can -- look up "weights and measures". Of course, they'd look incredibly foolish for making such a claim, and as such wouldn't do it.

and that a dog is a person/citizen eligible to vote (if they are 18 years of age, which means of course 720 days old since a year is now 40 days).

Well, no, the supreme court would be responsible for defining "personhood" -- and this kind of cuts to the heart of the abortion debate (and before that, slavery).

If your claim was true, there would be no need for the coinage act. America is a soverign country, and the currency standards of other nations are irrelevant. There is no single "historical" definition of a "dollar" -- several coins bearing that name (or ancestors of it) being worth various amounts of silver (or gold) existed well before either the spanish dollar, or indeed the discovery of the Americas.

So, your claim is bullshit.

The coinage act was based on Alexander Hamilton's recommendation to congress, and the value was chosen for practical matters -- the alternatives were the dutch dollar, the shilling, and the german thaler (which americans called "dollar"), but our trading ties with Spain were strongest and we wanted to sever all things british. Yes, we once had coins of a certain weight of silver that we called "dollar" -- but this was simply federal law, not "constitutional".

The coinage act would not have been necessary if there was some single, universal value of "dollar", and all of the subsequent coinage acts and other laws that redefined what a dollar is (from various amounts of silver, to silver or gold, to just gold, to "whatever the market decides") would be irrelevant.

But they aren't. No matter how much your revolutionary war reenactment fantasies want them to be, no matter how strongly you disagree with the actions taken by congress, it won't change the fact that congress does have the power to define the value of money in the united states (or to delegate that power to someone else).

Troy says

There is no law or statute anywhere in America that describes what a dollar is. Maybe that’s what the original question was…”What is a dollar”?

Yeah, no law or statute other than the various coinage acts, the gold standard act (which essentially reversed the metal => dollar definition by pricing gold in terms of dollars), and Bretton Woods.

The last two are what gave Richard Nixon the authority to bring us to the current "whatever the market decides" standard.

Now, I have to ask you, do you *honestly* believe that if there was actually any legitimate case to be made that congress doesn't have the power to define the value of a dollar, that it wouldn't have been challenged numerous times in the past?

The dollar is, and will be, defined by pricing it in relation to gold. Its just that the "value" of the dollar is baseless and floating against something of value, such as gold. Even a 6th grader knows putting ink on paper does NOT create "value".

Congress does NOT want to define the dollar. If it did, the fraud of inflation would be exposed, and the patriots in America would demand change. With a sound currency war could not be waged on multiple fronts, bridges to no-where could not be built, airports without passengers wouldn't exist, pork projects, waste and fraud would begin to disappear.

I think that's what AdHo was trying to point out in his retorical question: "What is a Dollar?"

Kevin says

The coinage act would not have been necessary if there was some single, universal value of “dollar”,

once again you are mistaking "value" for a physical quantity of silver. The dollar is a yardstick, it doesn't matter if the yardstick goes up in value or down, it is still the same 36 inches. And it doesn't matter if the dollar goes up or down it is still the same amount and purity of silver. When the constitution was written the dollar was a fixed and well understood piece of silver. The coinage act simply put numbers to the already known and measurable quantity and quality of silver that constituted a dollar. Which is why they did not need to amend the portions of the constitution that reference a "dollar." The dollar did not change with the coinage act, it simply received a more precise definition which enabled the congress to "coin" these dollars, which is exactly what the constitution called for them to do.

I can't believe you're still trying this argument. Hell, you don't even know what the term "value" means. It's quite amazing.

Yes, there were pieces of silver that people used in the Americas called "dollars" when the constitution was written. In fact, there were at least 5 different pieces of silver called dollars (4 of which were a different amount of silver -- and one gold). There was no "fixed and well understood" amount of silver that was a dollar. What the coinage act did is decide that the "fixed" (though certainly not well understood, since instruments were horribly imprecise at the time) amount of silver in a Spanish dollar was to be the amount of silver to be placed inside of US dollars.

This had nothing to do with the constitution, because the constitution didn't define it. It let congress define it. And congress said "a dollar is a coin made out of this much silver". Later they changed that amount of silver. Eventually they changed it to gold, and finally to an abstract concept.

Why you can't understand this, I'll never know, and it's a good thing that this conversation has no bearing on reality anyway. Please go try to exchange the only legal tender in the united states for .85 oz. of silver and let me know how that goes.

Nomograph says

theoakman says

We can make fractional reserve lending illegal as well. Have you ever seen the way they regulate casinos? The government makes sure they have cash on hand for their chips in circulation. I’ve never heard of a casino run.

You need to focus on finishing up. What, are you in your seventh year or something?

I did finish up. I already have a full time job. I just sit back and collect a second pay check from grad school now while I pretend to put the finishing touches on my thesis. Why are you always so anal about my career?

Paper bank notes represent money but they are not money. They are promissory notes whose "value" depends entirely on the fiscal and monetary discipline of the government that issued them.

Now I ask you, how much fiscal and monetary discipline do American politicians have? Hahaha.

Troy says

AdHominem says

The Dollar (specific amount and purity of silver) is just a yardstick. Congress has no authority to change the yardstick.

you’re literally insane, beyond reach of fact or reason. This will be my last post to patrick.net. Thanks all.

if this was your last post how come I saw a new post on another thread dated March 24, 2010? It seems Troy has a problem with the truth. Which is not news to me, seeing as how he still believes that a "federal reserve note" with a picture of George Washington is a legal dollar and the same thing as the dollar referred to in the 7th Ammendment and Article 1, Section 9, Clause 1 of the Constitution.

How are your attempts at exchanging silver for goods and services going?

Kevin says

How are your attempts at exchanging silver for goods and services going?

the dollar (a piece of silver) is a store of value as you love to point out.

a federal reserve note (a piece of paper) is debt.

How is that working out for AMERICA?

The Constitution says "No State shall coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debt".

Our monetary system is corrupt and evil. Fractional reserve banking is inherently evil. It is called multiple indebtedness. By decree the dollar is a Federal Reserve Note and forcefully to be used as legal tender for all debts, public and private. The dollar is as good as the people's confidence. Federal Reserve policies have eroded the value of the dollar (down 90+% the last 85+ years). The dollar will eventually be destroyed esp. with Obamacare, Soc Sec, Medicare, other promises, ad nauseum. No currencies last forever. Only gold and silver. Prior to the Jekyll Island event the gold dollar was a relatively stable value for almost 100 years. Let's institute a free market based money and the free market will determine the dollar's value. Of course the Central gov't won't allow this because of their corrupt taxing powers.

wcalleallegre says

Federal Reserve policies have eroded the value of the dollar (down 90+% the last 85+ years).

Down as compared to what?wcalleallegre says

No currencies last forever. Only gold and silver

Really? Please point me to where I can use gold or silver as currency today? If it lasts forever as a currency, then I should be able to use it somewhere, right?

Nomograph says

Pretty good so far. Except for health care, we are at the top of the heap.

Yes I believe we ARE the BIGGEST DEBTOR NATION!!!!

Wohoo!!! WE'RE #1

Thanks Federal Reserve!

Nomograph says

It’s amazing how little you seem to appreciate what you happen to have been born in to.

...unless it's to complain about people who want it, too.

AdHominem says

Nomograph says

Pretty good so far. Except for health care, we are at the top of the heap.

Yes I believe we ARE the BIGGEST DEBTOR NATION!!!!
Wohoo!!! WE’RE #1
Thanks Federal Reserve!

Well, shit, I suppose you should just move to a country that still uses metallic coins for currency.

Let me know how that works out for you.

Kevin,

Ever heard of a monetary reset? I suggest one is coming soon to a "democracy" near you.

I'll solve this all for every one of you with what I learned before pre-school:

100 cents = 1 dollar

End of discussion. Problem solved.

The correct solution is feeding the

http://www.youtube.com/watch?v=JnX-D4kkPOQ