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Archive for March, 2013

Students today are often given a skewed account of the Great Depression of 1921-1941 that condemns free-market capitalism as the cause of, and promotes government intervention as the solution to, the economic hardships of the era. In this essay based on a popular lecture, Foundation for Economic Education President Lawrence W. Reed debunks this conventional view and traces the central role that poor government policy played in fostering this legendary catastrophe. Read more…

Here are the eBook PDF and audio mp3 files:

Adobe Icon Myths of the Great Depression

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MP3 Audio AudioBar

http://www.fee.org/files/audioLib/great-myths-full.mp3

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March 21, 2013

Call it the Rick Perry gold rush: The governor wants to bring the state’s gold reserves back from a New York vault to Texas.

And he may have legislative support to do it. Freshman Rep. Giovanni Capriglione, R-Southlake, is carrying a bill that would establish the Texas Bullion Depository, a secure state-based bank to house $1 billion worth of gold bars owned by the University of Texas Investment Management Company, or UTIMCO, and currently stored by the Federal Reserve.

The idea isn’t entirely new. Some Republican members worked on a gold bill last session that was never filed. And gold-standard-backing Ron Paul, the former Texas congressman, has raised repeated concerns about the safety of states’ gold supplies.

“If you think gold is a hedge, or a protection, you always want it as close to the individual and the entity as possible,” Paul told the Tribune on Thursday. “Texas is better served if it knows exactly where the gold is rather than depending on the security of the Federal Reserve.”

Bringing Texas’ gold home has gained more traction this legislative session because of Perry’s vocal support for it. On conservative radio host Glenn Beck’s show on Tuesday, the governor said Texas was “in the process” — the legislative process, he later clarified — of “bringing gold that belongs to the state of Texas back into the state.” He argued that the state was at least as capable as the Federal Reserve of safeguarding Texas’ “physical gold.”

“If we own it,” Perry said, “I will suggest to you that that’s not someone else’s determination whether we can take possession of it back or not.”

State Rep. Lon Burnam, D-Fort Worth, said he was familiar with Capriglione’s bill but was skeptical that it addresses a legitimate problem facing the state.

“We’ve got plenty of real problems that we’re not going to deal with this session,” Burnam said. “Let’s deal with them.”

Capriglione said he was at a Tea Party event in Tarrant County earlier this year where Perry spoke about the state’s gold investments as an economic development tool. Since then, he has been working with Perry’s office on the bill.

“Something on the scorecards of a lot of these businesses in deciding whether they want to come to Texas is stability and gold as being one of those items,” Capriglione said. “I think it’s been in his consciousness for a while in trying to get some sort of depository in the state of Texas.”

He has also spoken with UTIMCO, which owns the 6,643 gold bars currently housed underground in New York City.

“We’re trying to figure out the right amount of gold to have here in Texas,” Capriglione said. “’We don’t want just the certificates. We want our gold. And if you’re the state of Texas, you should be able to get your gold.”

The United States and many other countries stopped pegging their currencies to the gold standard decades ago. Capriglione said the bill is not about putting Texas on its own gold standard. Rather, a depository would give the state a reputation as being more financially secure in the event of a national or international financial crisis.

“For us to have our own gold, a lot of the runs on the bank and those types of things, they happen because people are worried that there’s nothing there to back it up,” Capriglione said. “So I think this cures a problem before it can happen.”

Physically transporting gold that various state entities own from New York City or other banks to Texas would be impractical from a security and logistics standpoint, Capriglione said. He believes it makes more sense to sell the gold Texas has elsewhere and repurchase it within state lines.

He said he doesn’t think the measure would be a significant expense, because the gold bars could be safeguarded in a small area, no bigger than 20 square feet.

Capriglione said he is working on revisions to the bill to address some concerns he has heard. He plans to make sure the bill would not cause the state to change its overall asset portfolio to be more heavily invested in gold. Also, to lower the bill’s costs, he expects to change the language to allow some of the administrative costs of building and running the depository to be handled by the private sector.

Such a bill might not divide lawmakers along strictly party lines. State Sen. Rodney Ellis, D-Houston, called the bill “an interesting concept” but said he would want to learn more about it and talk to “colleagues in the financial industry” before weighing in on its merits.

Texas Tribune donors or members may be quoted or mentioned in our stories, or may be the subject of them. For a complete list of contributors, click here.

This article originally appeared in The Texas Tribune at http://www.texastribune.org/2013/03/21/perry-some-lawmakers-want-states-gold-back-texas/.

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NASHUA, N.H. — Gov. Rick Perry sent the media into a feeding frenzy this week when he went hammer and tong after the U.S. Federal Reserve, but supporters of another Texan running for the White House heard something familiar: the message of Ron Paul.

“We agree with him, but let’s point out that he’s parroting what Ron Paul has been saying for years,” said Debra Medina, a Ron Paul acolyte who ran an unsuccessful gubernatorial campaign against Perry in 2010. “He’s reading the economy and the monetary policy concerns and he’s mimicking Ron Paul.”

Perry’s sustained attack on the central bank has helped nourish a widespread feeling among Paul supporters that the Republican congressman can’t catch a break. He’s been bashing the Fed for years, and here comes Perry stealing all the thunder.

Paul, who ran a new ad this week criticizing Perry and other “smooth-talking” politicians, was opening his campaign headquarters Wednesday evening about 15 miles from where the Texas governor spoke to a bipartisan breakfast gathering. Perry had the kind of national media entourage in tow that Paul has never drawn, much to the consternation of Paul’s supporters, who accuse the media of ignoring their candidate.

Perry set off a firestorm when he said it would be “almost treasonous” for the Federal Reserve chairman to print more money to help prop up the economy before the 2012 election. He has since toned down the heated rhetoric, but Perry has been more than happy to keep the focus on the issue.

At the breakfast on Wednesday, he joked that he had gotten “in trouble” for talking about the Fed, but he used the occasion to pile more criticism on it. He called for an audit of the Federal Reserve and said it would show whether or not there had been any “improper” behavior.

On Tuesday, Paul suggested the governor’s Fed attack was politically motivated.

“I think politically he’s pretty astute. He came out for secession, too, when he had a Tea Party candidate running against him,” Paul said of Perry on CNBC’s The Kudlow Report. “I have no idea what his real principles are.”

He noted that he’s long been a foe of the Fed. “I was motivated in the 1970s, because the handwriting was on the wall,” he said on the cable business news channel.

Like Paul, Perry is tapping into a sea of mistrust and discontent about the central bank and the falling value of the U.S. dollar. But the governor stops well short of Paul, who wants to abolish the Federal Reserve and return to the gold standard and an exclusively private banking system. During the debt ceiling drama in Washington, with the possibility that the U.S. might default on its obligations, Paul proposed stiffing the Federal Reserve.

“We owe, like, $1.6 trillion because the Federal Reserve bought that debt, so we have to work hard to pay the interest to the Federal Reserve,” Paul told CNN Money at the end of June. “We don’t, I mean, they’re nobody; why do we have to pay them off?” The website noted that the Fed turns over the interested earned to the federal government, including $79 billion returned to the Treasury in 2010.

Jim Henson, who directs the Texas Politics Project in the Department of Government at the University of Texas, compared the controversy over the Fed to Perry’s sensational 2009 comments about the possibility that Texas might secede from the U.S.: The media and many mainstream voters tend to lose their minds, but Perry scores with an influential group of Republicans key to his party’s nomination.

“I think it’s another one of these issues where he found something that he’ll get criticized about from the outside but will be golden with in his base,” said Henson, who is also co-director of the University of Texas/Texas Tribune poll with Daron Shaw. “It’s almost like a little glimpse of the old Rick Perry. I think it helps him.”

Texas Tribune donors or members may be quoted or mentioned in our stories, or may be the subject of them. For a complete list of contributors, click here.

This article originally appeared in The Texas Tribune at http://www.texastribune.org/2011/08/18/perrys-attack-fed-echoes-ron-paul/.

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Posted: Mar 18, 2013 5:18 PM Updated: Mar 18, 2013 5:21 PM

By CRISTINA SILVA
Associated Press

PHOENIX (AP) – Arizona Republican lawmakers say privately minted gold and silver coins should be considered legal tender.

The bill advanced in a 4-2 vote by a House committee Monday states that gold and silver is money and therefore shouldn’t be subject to tax or regulation as property.

Proponents say the value of the dollar is on the decline. Businesses wouldn’t be required to accept gold or silver under the bill.

Democrats oppose the measure. They say it would be a bureaucratic nightmare because businesses don’t have the equipment to determine the value of gold and silver.

They also say the measure is Arizona’s latest jab at the federal government, which prohibits states from minting their own money.

The bill passed in the Republican-led Senate in February in a 17-11 vote.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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I wish the reporter had enough education or intellectual honesty to report that the Constitution, (the people), not the Federal Government, prohibits the states from coining money.  The reporter twists the facts to make it appear that the Federal Government is sovereign, not the people.  Is there any way to correct and educate reporters when they make these “errors”?  Can the AP be required to retract or correct their words in the interest of honesty and fairness to the public that they “serve”?

I can’t express the horror and outrage I feel almost every day as I hear people (who should be educated) telling other people that Federal Law always trumps State Law.  Almost everyone has heard this falsehood said enough times that they now believe it to be true.  Even many of our elected representatives in Arizona State Government, who have sworn an oath to uphold the Constitution, profess to believe this and accept it as fact.  These ignorant, sadly misled or misinformed representatives pose our greatest barrier to State nullification of unconstitutional dictates of the Federal Government – do they not?

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10thAmendCtrLogo

Arizona, Support Sound Money!

SB1439 passed the State Senate and needs your help to pass the House as well.

Arizona SB 1439, The Constitutional Tender Act, has passed the senate 17-11 and is now on its way to the House for concurrence.

Senate Bill 1439 is an act to that would allow the State of Arizona to return to sound money and uphold Article 1 Section 10 of the Constitution. Your support is needed right now to help move this bill forward.

ACTION ITEMS

1. Contact your state representative.  Strongly, but politely, let them know you want them to vote YES on SB1439. Remind them that you expect them to support the Constitution, and that includes Article 1, Section 10 which says that the state needs to allow gold and silver to be used as legal tender. SB1439 will help facilitate this constitutional duty and you want a YES vote.

Contact info here:
http://www.azleg.gov/alisStaticPages/HowToContactMember.asp

2. Share this information widely.
Please pass this along to your friends and family. Also share it with any and all grassroots groups you’re in contact with around the state. Please encourage them to email this information to their members and supporters.

BACKGROUND INFORMATION

Currently all debts and taxes in Arizona and the rest of the United States are either paid with Federal Reserve Notes (dollars) which were authorized as legal tender by Congress, or with coins issued by the U.S. Treasury — very few of which have gold or silver in them.

The United States Constitution states in Article I, Section 10, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.” The Constitutional tender act is a big step towards that constitutional requirement which has been ignored for a long time in every state of the country. Such a tactic would achieve the desired goal of abolishing the Federal Reserve system by attacking it from the bottom up – pulling the rug out from under it by working to make its functions irrelevant at the State and local level.

Passage of the Constitutional Tender Act would introduce currency competition with Federal Reserve Notes. Professor William Greene explains further:

“Over time, as residents of the State use both Federal Reserve Notes and silver and gold coins, the fact that the coins hold their value more than Federal Reserve Notes do will lead to a “reverse Gresham’s Law” effect, where good money (gold and silver coins) will drive out bad money (Federal Reserve Notes). As this happens, a cascade of events can begin to occur, including the flow of real wealth toward the State’s treasury, an influx of banking business from outside of the State – as people in other States carry out their desire to bank with sound money – and an eventual outcry against the use of Federal Reserve Notes for any transactions.”

Once things get to that point, Federal Reserve notes would become largely unwanted and irrelevant for ordinary people. Nullifying the Fed on a state by state level is what will get us there.

Without a single act of Congress, the Federal Reserve system can be brought to its knees by passing such bills in states all over the country.

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