As you’ve all come to realize our government will not tolerate competition. And, above all others its congressionally-awarded contractor, the US Federal Reserve, can be deadly for competitors.
Beyond Bernard von NotHaus
Editorial of The New York Sun | December 3, 2014
Congratulations are in order to United States District Judge Richard Voorhees of North Carolina for the judiciousness of his decision in the case of Bernard von NotHaus. We weren’t personally present at the courthouse at Statesville, where von NotHaus had been ordered to appear Tuesday for sentencing on his conviction of uttering — introducing into circulation — his Liberty Dollars. But we were on tenterhooks, because von NotHaus, 70, was looking at the possibility of spending the rest of his life in prison.
The reason we’ve been watching the case is that von NotHaus’ demarche is one of the few direct challenges to what the Foundation for the Advancement of Monetary Education likes to call “legal tender irredeemable electronic paper ticket money.” That refers to the scrip being issued by the Federal Reserve. Von NotHaus had designed and circulated a medallion made of pure silver, the same specie that was fixed on by the Founders of America as the basis of the constitutional dollar.
A jury found, among other things, that von NotHaus’ Liberty Dollar violated federal law against private coinage and was similar enough to American legal-tender coin that it constituted counterfeiting. “Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism,” the prosecutor, Anne Tompkins, said after von NotHaus was convicted. She suggested that such schemes “represent a clear and present danger to the economic stability of this country.”
In the three and a half years since the jury reached its decision, Judge Voorhees allowed constitutional and procedural objections to be heard but in the end supported the jury. The government on Tuesday asked for a prison sentence of at least 14 years and as much as 17 ½ years. The government was also seeking forfeiture of some 16,000 pounds of Liberty Dollar coins and specie, which in 2011 it had valued at nearly $7 million.
Then spake the judge, sentencing von NotHaus to but six months of home detention, to run concurrently with three years of probation. He departed from non-binding guidelines because, he suggested, von NotHaus had been motivated not by criminal intent but by an intention to make a philosophical point. That is what these columns have been reporting for more than four years, and, while the Sun’s coverage played no part in the case, we are glad to discover that the judge is of a similar, if not identical, mind.
Von NotHaus is no doubt relieved that he doesn’t have to go to jail, but he has put out no statement. Our guess is that it is sinking in on him that he has been marked now as a felon, and his own dream of a parallel form of money, composed of constitutional specie, is gone. There may yet be surprises, but the sagacity of Judge Voorhees’s handling of this case lies in, among other elements, the fact that he has left no great incentive for either side to make an appeal.
Whatever happens, the logic now is for the issues raised in the von NotHaus case to be pursued in the political arena. We are coming up on the 50th anniversary of the Coinage Act of 1965, which stripped silver from our common coinage. President Lyndon Johnson, who signed the bill into law, called it “the first fundamental change in our coinage in 173 years.” He noted that during that nearly two-century span our coinage of dimes, quarters, half dollars, and dollars have contained 90 percent silver.”
“The new dimes and the new quarters will contain no silver,” the president confessed. “They will be composites, with faces of the same alloy used in our 5-cent piece that is bonded to a core of pure copper.” That is how the debasement began, though LBJ did issue a warning. “If anybody has any idea of hoarding our silver coins, let me say this. Treasury has a lot of silver on hand, and it can be, and it will be used to keep the price of silver in line with its value in our present silver coin.”
It was a vain boast. At the time, the value of the dollar was more than two-thirds of an ounce of silver, as it was in 1792. By January 1980, the value of a dollar plunged to less than a 49th of an ounce of silver and even today has regained nowhere near its historic value. It is a shocking abdication by the United States Congress, a point that von NotHaus has thrown into sharper relief than any monetary gadfly has managed to do in years. That is no small achievement.