The U.S. economy is having big problems.  This is not news!  But some legislators in Georgia think they have a solution to the problem.  While it would only impact their State, their hope is that if the bill passes they will set a good example for other states as well as the Federal Government.

The Constitutional Tender Act is Georgia House Bill (HB) 430.  It was introduced by Representative Bobby Franklin (R-43) in 2009.   He points out that the United States Constitution declares (Article I, Section 10) that “No State shall…make any thing but gold and silver coin a tender in payment of debts.”  However this is no longer the case.

Right now, the U.S. uses fiat currency, which means it’s not backed by any commodity such as gold or silver.  It derives its value by being declared by the government to be legal tender.  That is, it must be accepted as a form of payment within the boundaries of the country for all debts, public and private.

Rep. Franklin feels that the country needs to return to a gold and silver-backed currency, and that the present fiat money situation is one of the reasons the value of the dollar has dropped so dramatically.

He wants the transition to take place in 2011.  He envisions store owners accepting either the fiat currency or the new gold/silver-backed currency, just as a store owner in Mexico might accept pesos or U.S. dollars.

The exchange of gold and silver currency could take the form of U.S. minted gold or silver, or having special checking accounts where it would all be handled electronically, via checks, or via silver or gold-backed credit and debit cards.  I guess that would give a whole new meaning to the phrase “gold card”!

A vote will be taken sometime this year.  If it passes, Rep. Franklin contends that will be a good beginning toward stabilizing our economy and will encourage other states to follow suit.  (A handful of states are currently discussing similar possibilities.)  It would also increase the value of gold and silver as becomes increasingly important as legal tender.

To hear a video discussion about HB 430, go to this Constitutional Tender Act link on YouTube. For additional information, visit the Constitutional Tender Act website or the Georgia General Assembly website.

Source: http://media.causes.com/ribbon/724677