This weekend, a North Carolina man was convicted of minting and circulating “Liberty Dollars” and “Ron Paul Dollars” that were valued based on the gold and silver they contained. The man, Bernard von NotHaus, now faces up to 25 years in prison and the forfeiture of $7 million worth of gold and silver that was taken by police in a raid.
The U.S. Attorney who prosecuted the case explains:
“It is a violation of federal law … to create private coin or currency systems to compete with the official coinage and currency of the United States.”
But what’s wrong with competition? As long as there’s no fraud or counterfeiting – which NotHaus has not been convicted of – I would think that individuals should be allowed to use whatever currency they want.
Absolutely not, says the U.S. Attorney who prosecuted the case:
“Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism. While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country.
We are determined to meet these threats through infiltration, disruption, and dismantling of organizations which seek to challenge the legitimacy of our democratic form of government.”
Offering a competing currency to the US Dollar challenges “the legitimacy of our democratic form of government”?
Give me a break.
Competing with U.S. Government money is illegal. But it shouldn’t be. The Cleveland Federal Reserve notes that private currencies have even helped the economy function in the past: During the Great Depression, the Federal Reserve failed to keep enough currency in the economy – so some companies issued their own currencies and helped fill the void.