ScratchMonkey

Ron Paul has introduced a couple bills allowing competition in currency. I'm wondering if the economists here at TG see a problem with this.

http://action.downsizedc.org/wyc.php?cid=85

The proposed bills remove these paragraphs:

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Kerostasis

Eliminating the law against Counterfeiting is supposed to stop inflation? Yes, I have a problem with that. I'm sorry, but Ron Paul is out of his mind.

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ScratchMonkey

I think the idea is to let others compete with the counterfeiting that the Fed does. It's like letting bloggers compete with the established news media, making people (rightfully) less trusting of the establishment. By letting anyone print money, you make people more skeptical of the current monopoly that does so.

Turn the question on its head: If citizens can't be trusted to print money, why should we trust an unelected secret council to do so?

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El_Gringo_Grande

is this how all Ron Paul supporters think?

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Kerostasis

As I understand it, your primary complaint against the current keepers of the right to print money is that they use that right too often, and print too much money.

Distributing that right to all citizens will only exaggerate that complaint, not solve it. The amount of money being printed will only rise faster than it did before. The only possible advantage to such a plan would be to intentionally destroy the value of the dollar, if such was your intent, in order to force us to switch to some other currency.

Considering how completely nuts Ron Paul is, I wouldn't be at all suprised if that was his intent, but he left a loophole -- eliminating the law against counterfeiting US Currency also eliminates the law against counterfeiting foreign currency, which is likely to draw a lot of international outrage when they realize that most of the counterfeit money flowing into their borders is being smuggled there from the US. And Ron Paul was supposed to be the guy who would give other nations less reason to hate us, not more.

Edit: My apologies, I mis-read the counterfeiting section as applying to all monetary counterfeiting, but on second reading that only applies to coinage counterfeiting. Currency counterfeiting would presumably still remain illegal. I still think its a bad idea, but its not AS bad of an idea, and not for the same reasons.

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[tR]Greasy_mullet

Ron is out of his mind. This is one of the basic and legit functions of our Government.

The real problem that I see and perhaps this is Pauls point, is that when the government gets in debt, they simply print more money to pay it off. In turn that screws us all which is a big part of the problem we are facing right now and nobody is talking about it.

Eroak

It isn't nessary. Back in the 20's to 30's, we didn't have the economic protection programs that we have in place now. We learned a great deal from the great depression and it's still a possability, but not a great as it once was. I think this would cause many more problems in a system that is working. I'm not saying it's perfect, but it's stable. Don't fix it if isn't broke.

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Switchcraft

Please note that it also retroactively nullifies people convicted of counterfeiting coined money in our nation. Meaning if I owned a video arcade, and someone made metallic replicas of quarters that would play the games but not provide me with actual income, well according to Ron Paul they should never have been punished. Way to come out in favor of theft. Same with newspaper dispensers, parking meters...

GlobalWarmin

Doktor Goku

I'm generally not a fan of congressmen who introduce legislation not to actually make legislation, but to make a statement.

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ScratchMonkey

I don't make the complaint, I merely relay it. You're one of the few who've attempted to address the issue and not make ad hominem attacks on the messenger.

If we are to trust the government with this one thing, perhaps the cornerstone of our economy, then why not all things? Why not go to central planning of the whole economy, if the government knows what's best for us with money?

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ScratchMonkey

Money is a commodity. The idea is to introduce competition such that someone who makes sounder money will get more of one's business than someone who allows the value of their money to dilute.

As to coinage, consider that the US is trying to get out of using nickel in its pennies because it makes them too expensive to manufacture. Some are melting them to get the metal value. Recall that they were once really copper, and nickel was substituted when they devalued to the point that the copper became immensely more valuable.

Perhaps the solution to your proposed coin issue is to allow the US to "trademark" the images on its coins, and for others to do the same, so that minting coins with a competitor's TM is punished for misrepresentation and an attempt to hurt a competitor. If you make a coin with your own TM, it's up to the customer to decide what it's worth. (Just as they do now with designer jeans that have value only because of a label.)

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ScratchMonkey

You prefer the 800 page "compromises" that no one but the aids and lobbyists have read? The ones that drive up unfunded liabilities?

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Switchcraft

I don't understand what you mean by my "proposed coin issue." It isn't my proposal, it's Ron Paul's...specifically, he proposes to forgive all people who have committed acts of fraud and theft by purposefully making or using fake coins. HIS proposal, the one you have relayed, says that. I do not know why you are talking about tademarks in relation to that, since future ability to trademark will not do anything to address past thefts by counterfeiters. In fact, forgiving such past frauds seems to be exactly the opposite of the ideal that Ron Paul supposedly is espousing, since the issue at hand is whether or not people should be able to decide what kinds of currency they are willing to accept as valuable. How is forgiving past counterfeiting of coinage addressing that? By declaring past counterfeiting convictions null and void Dr. Paul is telling business owners who have been defrauded that they had no choice but to accept anything that was given to them in payment.

The great thing about the act being only 104 words long is that it's clearly and concisely more about being a gift to his goldbug friends than anything truly designed to benefit those who market goods and services.

Most importantly, how come a guy so supposedly into following the absolute letter of the Constitution seems to have such trouble with:

"To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures"

or

"To provide for the Punishment of counterfeiting the Securities and current Coin of the United States"

Congress gets to decide the punishment, but it seems to me that the Constitution very clearly says that it's a crime that needs to be punished. I could swear there's a Constitutional process that lets you change the wording, something about amendments. I could ALSO swear that passing a law that flouts the specific wording of the Constitution...like, perhaps, declaring by statute that some portion of the Constitution is just no longer applicable, is called "Un-Constitutional." I could swear I hear that word from the Ron Paul camp more than any other word, but I am starting to think it must not mean what they think it means.

Buck Fush

I want to start out by saying that I'm not speaking out for or against this.

I am having a problem finding any quote from Ron Paul calling for the release of counterfeiters. Can one of you guys post a reference link to that effect? There is a huge difference between someone printing their own currency based off of their own reserve and someone printing what appears to be a note drawn off of someone else's reserve(counterfeiting).

It appears to me as if he is calling for competition for the Federal Reserve. He surmises that the federal government should not be allowed to print their way out of debt and that competing currencies would reduce inflation. I do see the point: Every time they print a new dollar, the ones I already have become less valuable.

I also don't believe he wants me to be printing my own money. I mean, sure I can print it, but without a TRUSTED reserve it would be worthless. If, however, I were to print something resembling a Federal Reserve Note, i would be guilty of counterfeiting.

I have no idea if it would work or not, but I do believe the "Ron wants amnesty for counterfeiters" argument is a straw man.