MONEY: Governments have always robbed their subjects by debasing the currency

Paper Money = Despotism
By Wendy McElroy | 10/08/12

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In his invaluable book What Has Government Done to Our Money? the Austrian economist Murray Rothbard addresses the strange reluctance to consider private currencies, “Many people, many economists, usually devoted to the free market, stop short at money. Money, they insist, is different; it must be supplied by government and regulated by government.” (Note: Technically, the currency is generated through a banking cartel with government support.)

History frowns upon that theory. Before the United States Mint issued its first coin in 1793, the 13 colonies were awash with an assortment of currencies that included both private and government-issued ones. Current fiscal reality also frowns on this. Privatizing zealot Martin Durkin calls the idea of government guaranteeing the quality of money “the sickest joke in economic history. Governments have always robbed their subjects by debasing the currency, but this abuse, in recent years, has burst all bounds of decency and sanity.”

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Had a similar conversation this weekend with Luddite.

We were talking about “secession”.

Among the challenges that came up was “money”.

A State, that secedes, would want to abandon the “Federal Reserve Note”. If it was smart, it would use what ever the free market dictated and allow it all to float. 

Second best would be to demand gold and silver in what it collects and what it pays.

Luddite was stunned that folks might have to change money.


Guess he’s never traveled internationally that much.

If the seceding State used gold or silver, I’d want some of that. Rather than the trash we have now.

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