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Seasoned...
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I believe it was the British merchants rather than the bankers that agitated for the Currency Act of 1751 because the colonies were issuing more paper money than was backed by bullion and which depreciated rapidly.
At the end of the day it is always the profit line that drives politics.
Publication of the Board of Trade's representation and Franklin's reply in the Chronicle and the Gazette in Philadelphia. London, March 11, 1767.
Remarks on the Report published in our last Chronicle. By B. F. Esq;
In the Report of the Board of Trade, dated February 9, 1764, the following Reasons are given for restraining the Emission of Paper Bills of Credit in America, as a legal Tender.
1. That it carries the Gold and Silver out of the Province, and so ruins the Country, as Experience has shewn in every Colony, where it has been practised in any great Degree.
2. That the Merchants trading to America have suffered and lost by it.
3. That the Restriction has had a beneficial Effect in New-England.
4. That every Medium of Trade should have an intrinsic Value, which Paper Money has not. Gold and Silver are therefore the fittest for this Medium, as they are an Equivalent, which Paper never can be.
5. That Debtors, in the Assemblies, make Paper Money with fraudulent Views.
6. That in the Middle Colonies, where the Credit of the Paper Money has been best supported, the Bills have never kept to the nominal Value in Circulation, but have constantly depreciated to a certain Degree whenever the Quantity has been increased.
To consider these Reasons in their Order. The first is, That Paper Money carries the Gold and Silver out of the Province, and so ruins the Country, as Experience has shewn in every Colony where it has been practised in any great Degree. This seems to be a mere speculative Opinion, not founded on Fact in any of the Colonies.
The Truth is, that the Balance of their Trade with Britain being generally against them, the Gold and Silver is drawn out to pay that Balance; and then the Necessity of some Medium of Trade has induced the making of Paper Money, which could not be carried away.
Thus, if carrying out all the Gold and Silver ruins a Country, every Colony was ruined before it made Paper Money. But, far from being ruined by it, the Colonies, that have made Use of Paper Money, have been and are all in a thriving Condition.
Their Debt indeed to Britain has increased, because their Numbers, and of course, their Trade, has increased; for all Trade having always a Proportion of Debt outstanding, which is paid in its Turn, while fresh Debt is contracted, that Proportion of Debt naturally increases as the Trade increases; but the Improvement and Increase of Estates in the Colonies has been in a greater Proportion than their Debt.
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"The second reason is, That the Merchants trading to America have suffered and lost by the Paper Money. This may have been the Case in particular Instances at particular Times and Places, as in South-Carolina about 50 Years since, when the Colony was thought in danger of being destroy'd by the Indians and Spaniards; and the British Merchants, in fear of losing their whole Effects there, call'd precipitately for Remittances; and the Inhabitants to get something lodg'd in safer Countries, gave any Price in Paper Money for Bills of Exchange, whereby the Paper as compar'd with Bills or with Produce or other Effects fit for Exportation, was suddenly and greatly depreciated...."
"The 3d Reason is, That the Restriction has had a beneficial Effect in New England. Particular Circumstances in the New England Colonies made Paper Money less necessary and less convenient to them. They have great and valuable Fisheries of Whale and Cod, by which large Remittances can be made. They are four distinct Governments; but having much mutual Intercourse of Dealings, the Money of each us'd to pass currant in all: But the whole of this common Currency not being under one common Direction, was not so easily kept within due Bounds, the prudent Reserve of one Colony in its Emissions, being rendred useless by Excess in another."
"The 4th. Reason is, That every Medium of Trade should have an intrinsic Value, which Paper Money has not. Gold and Silver are therefore the fittest for this Medium, as they are an Equivalent, which Paper never can be. However fit a particular Thing may be for a particular Purpose, wherever that Thing is not to be had, or not to be had in sufficient Quantity, it becomes necessary to use something else, the fittest that can be got, in lieu of it."
"The 5th Reason is, That Debtors in the Assemblies make Paper Money with fraudulent Views. This is often said by the Adversaries of Paper Money, and if it has been the Case in any particular Colony, that Colony should, on proof of the Fact, be duly punish'd. This however would be no Reason for punishing other Colonies who have not so abused their legislative Powers."
"The 6th. and last Reason is, That in the Middle Colonies, where the Paper Money has been best supported, the Bills have never kept to their nominal Value in Circulation, but have constantly depreciated to a certain Degree whenever the Quantity has been increased. If the Rising of the Value of any particular Commodity wanted for Exportation, is to be considered as a Depreciation of the Values of whatever remains in the Country, then the Rising of Silver above Paper, to that Height of additional Value which its Capability of Exportation only gave it, may be called a Depreciation of the Paper. Even here as Bullion has been wanted or not wanted for Exportation, its Price has varied from 5s. 2d. to 5s. 8d. per Ounce. This is near 10 per Cent; but was it ever said or thought on such an Occasion, that all the Bank Bills, and all the coin'd Silver and all the Gold in the Kingdom were depreciated 10 per Cent? Coin'd Silver is now wanted here for Change, and One per Cent is given for it by some Bankers; are Gold and Bank Notes therefore depreciated 1 per Cent? The Fact in the Middle Colonies is really this. On the Emission of the first Paper Money, a Difference soon arose between that and Silver, the latter having a Property the former had not, a Property always in Demand in the Colonies, to wit, its being fit for a Remittance."
NOTE: This may have attributed to; Section 8 permits Congress to coin money and to regulate its value. Section 10 denies states the right to coin or to print their own money. The framers clearly intended a national monetary system based on coin and for the power to regulate that system to rest only with the federal government. The delegates at the Constitutional convention rejected a clause that would have given Congress the authority to issue paper money. They also rejected a measure that would have specifically denied that ability to the federal government (Hammond, 92). Although the Constitution does not state that the federal government has the power to print paper currency, the Supreme Court in McCulloch vs Maryland (1819) ruled unanimously that the Second Bank of the United States and the banknotes it issued on behalf of the federal government were Constitutional. If the federal government only is permitted to issue money, coin or paper, then how could state banks issue money? State banks did not coin money, nor did they print any "official" national currency. However, state banks could print bills of credit in exchange for specie deposits. These notes would bear the issuing bank's name and entitle the bearer to the note's face value in gold or silver upon presentation to the bank. State bank notes were a form of representative money; they were not gold or silver, but they represented it. The notes were more convenient for conducting large transactions than their specie counterparts, and, more importantly for the extension of credit, could be produced easily whereas the gold and silver stock of the nation was relatively small and for the most part declining (Hixson, 12-13). The Supreme Court ruled in 1837 in Briscoe vs Bank of Kentucky that state banks and the notes they issued were also constitutional.
Citations:
31 USC 315B provided that: "No gold shall after January 30, 1934, be coined, and no gold coin shall after January 30, 1934, be paid out or delivered by the United States; provided however, that coinage may continue to be executed by the mints of the United States for foreign countries". This exception was necessary because foreign countries, being recognized or sovereign, could not be held to the internal public policy of the United States. HJR-192 was binding only upon those individuals who were beneficiaries of public policy; that being the privilege of limited liability for payment of debt arising out of participation in the Federal Reserve Public Credit System.
Which brings up of course again arguments later on in 1933, of HJR 192. and if I may quote (again)..
On June 5, 1933, Congress enacted HJR-192 to suspend the gold standard and to abrogate the gold clause. This resolution declared that "Whereas the holding or dealing in gold affect the public interest, and are therefore subject to proper regulation and restriction; and whereas the existing emergency has disclosed that provisions of obligations which purport to give the obligee a right to require payment in gold or a particular kind of coin or currency. . . are inconsistent with the declared policy of congress. . . in the payment of debts.
This resolution declared that any obligation requiring "payment in gold or a particular kind of coin or currency, or in an amount in money policy; and . . . Every obligation heretofore or hereafter incurred, shall be discharged upon payment, dollar for dollar, in any coin or currency which at the time of payment is legal tender for public and private debts."
A farm control bill around the same time period had attached to it a clause making Federal Reserve notes legal tender. In 1937, the Supreme Court struck down the Farm Control Act, thus carrying with it the legal tender status of Federal Reserve notes. Prior to 1933, Federal Reserve notes were used for inter-bank transfers. Around 1945, Congress passed a bill which called for the withdrawl of Federal Reserve notes from public circulation; but, they are still with us. . . *NOTE that the words do not talk about "payment" of debt, but clearly states that "Every Obligation . . . Shall be discharged."
In the case of Stanek v. White, 172 Minn. 390, 215 H.W. 784, the court explained the legal distinction between the words "payment" and "discharge": "There is a distinction between a `debt discharged' and a `debt paid.' When discharged the debt still exists though divested of its character as a legal obligation during the operation of the discharge. Something of the original vitality of the debt continues to exist, which may be transferred, even though the transferee takes it subject to its disability incident to the discharge. The fact that it carries something which may be a consideration for a new promise to pay, so as to make an otherwise worthless promise a legal obligation, makes it the subject of transfer by assignment."
Thus, it is clear that, as a result of HJR 192 and from that day forward (June 5, 1933), no one has been able to pay a debt. The only thing they can do is tender in transfer of debts, and the debt is perpetual. The suspension of the gold standard, and prohibition against paying debts, removed the substance for our Common Law to operate on, and created a void, as far as the law is concerned. This substance was replaced with a "Public National Credit" system where debt is money (The Federal Reserve calls it "monetized debt") over which the only jurisdiction at is Admiralty and Maritime.
HJR-192 was implemented immediately. The day after President Roosevelt signed the resolution the treasury offered the public new government securities, minus the traditional "payable in gold" clause. Article I, Section 10, Clause 1, proscribes the States making any thing but gold and silver coin a tender in payment of debt -- but, this Article does not contain an absolute prohibition against the States making something else a tender in transfer of debt.
HJR-192 prohibits payment of debt and substitutes, in its place, a discharge of an obligation -- thereby not only subverting, but totally bypassing the "absolute prohibition" so carefully engineered into the Constitution. There is, now, nothing for this Article to operate on, just as there is nothing for Common Law to operate on. Perpetual debt, bills, notes, cheques and credits fall within a totally different jurisdiction than contemplated by Article I, Section 10, Clause 1 -- and that jurisdiction belongs exclusively to the Law of Admiralty and Maritime. Now, it is easy to see how "bills" as plenty as oak leaves, "polluted the laws after the War For Independence, as described by Peletiah Webster". This is how we lost access to substantive Common Law -- the very law the Minute Men fought to regain.
HJR-192 places every person who deals in the public national credit in the legal position of a merchant, and the only jurisdiction over any controversy involving this subject matter is Admiralty and Maritime. Obviously, if we cannot pay our debts at law, we are also benefiting from limited liability under the Limited Liability Act when we use this credit-- and, that is marine insurance!
The definitions of "liability" and "insure" will help convince us of this fact -- in analyzing these definitions, keep in mind the distinction between "payment" and "discharge". Liability: The word is a broad term. It has been defined to mean: all character of debts and obligations. . . any kind of debt or liability, either absolute or contingent, express or implied . . . condition which creates a duty to perform an act immediately or in the future . . . duty to pay money or to perform some other service . . . the state of being bound or obligated in law or justice to do, pay, or make good something. "Insure: "To engage to indemnify a person against pecuniary loss from specified perils or possible liability".
Which now begs some questions.
QUESTION #1: Who do you suppose took possession of the treasury of the State of Pa. on June 5, 1933, -- the moment HJR-192 made it impossible for the State of Pennsylvania to pay its debts?
QUESTION #2: Land titles being allodial in Pennsylvania, what was the State Assembly's authority and jurisdiction to pledge these allodiums to the Federal Reserve as security for loan contracts from the Federal Government?
QUESTION #3: If the individual citizens of Pennsylvania were indeed "sovereign" under the Common Law -- What was the authority and jurisdiction of the State Assembly to pledge their labor to the Federal Reserve pool?
And your last statement could not be more true Sir...
Last edited on Sun Nov 19th, 2017 08:58 pm by Undrstm8ed
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