by Stephen Largen
(Editor’s note: We are overjoyed that a South Carolina legislator is thinking about the creation of a state currency. That means he sees a problem he’d like to correct. But he wants to correct it with more government. We have suggested in past articles that states could begin now collecting taxes in gold and silver, which would start its citizens down the path to new money. We do, however, disagree that the state needs to coin money and regulate its value. What any state should do is to establish the weight and purity of gold and silver money it collects in taxes. Then allow the free market to establish the value of the money. But even the coining of SC currency, based in gold and silver, would be a huge improvement over Federal Reserve notes.)
Continuing a pattern of attempts to assert South Carolina’s independence from the federal government, State Sen. Lee Bright, R-Roebuck, has introduced legislation that backs the creation of a new state currency that could protect the financial stability of the Palmetto State in the event of a breakdown of the Federal Reserve System.
Bright’s joint resolution calls for the creation of an eight-member joint subcommittee to study the proposal and submit a report to the General Assembly by Nov. 1.
The Federal Reserve System has come under ever-increasing strain during the last several years and will be exposed to ever-increasing and predictably debilitating strain in the years to come, according to the legislation.
“If there is an attempt to monetize the Fed we ought to at least have a study on record that could protect South Carolinians,” Bright said in an interview Friday.
“If folks lose faith in the dollar, we need to have some kind of backup.”
The legislation cites the rights reserved to states in the Constitution and Supreme Court rulings in making the case that South Carolina is within its rights to create its own currency.
“The Supreme Court of the United States has ruled that the states may adopt whatever currency they desire for the purposes of performing their sovereign governmental functions, even to the extent of adopting gold and silver coin for those purposes while refusing to employ a currency not redeemable in gold or silver coin that Congress has designated ‘legal tender.’…” Bright’s legislation states.
The legislation claims “many widely recognized experts predict the inevitable destruction of the Federal Reserve System’s currency through hyperinflation in the foreseeable future.”
Per the legislation, South Carolina’s new currency could consist of “gold or silver, or both.”
Bright said in explaining his introduction of the legislation that Virginia and Georgia are considering similar measures to protect their states against economic calamity in the event of the collapse of the Federal Reserve System.
Phil Bailey, the director of the state Senate Democratic Caucus, described the currency bill as a distraction from the real issues facing the state.
“Not any thing in that bill is going to create a job or improve education,” Bailey said Friday.
“It’s a waste of time; it’s a waste of resources. I mean who’s paying for this study? Will they be paid in actual dollars or gold doubloons?”
Bright responded by saying that his proposal is “something we ought to study” and “if there’s no support for the bill in the body, it won’t go anywhere.”
Bright’s bill has been referred to the Senate Finance Committee, but he said he’s working with Sen. David Thomas, R-Greenville, on the legislation, and Thomas could redraft it so that it’s referred to the Banking and Insurance Committee, of which Thomas is the chair.
Bright also has introduced legislation in the ongoing legislative session that would make a firearm, firearm accessory or ammunition that is commercially or privately manufactured in South Carolina and does not leave this state exempt from federal regulation, including registration.
During the 2010 session, Bright sponsored legislation passed by the state Senate that in addition to affirming South Carolina’s Second-, Ninth- and 10th-amendment rights, also targeted federal health care legislation by saying state residents are not subject to any law that interferes with patients’ rights to choose their own health care provider or pay for medical services directly.
“If at first you don’t secede, try again,” Bright said with a laugh after the legislation passed last year.
Secession-style language and proposals seeking to transfer power from the federal government to states and localities have become increasingly common in recent years during the fight over federal health care reform, perhaps most notably in Texas, where Republican Gov. Rick Perry in 2009 suggested the Lone Star State could secede in the future should the federal government not change its fiscal polices.
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