How Government Monetary Policies Hurt the Poor and Turn them Into Slaves of the State
The Constitution gives no governmental branch or independent organization (Federal Reserve System) the authority to tamper with weights and measures. The Federal government has authority “to coin money, regulate the value thereof, and of foreign coin, and fix the standard of weights and measures” (Article 3, section 8). Article 1, section 10 makes it clear that to coin money means “gold and silver Coin,” commodities that cannot easily be debased (inflated):
“No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts. . .”
This section of the United States Constitution is ignored by our national and state governments. Debts no longer are paid with gold or silver. Paper Federal Reserve Notes are now “legal tender,” a clear violation of the Constitution.
With the exception of the penny and nickel, coins are made from an alloy of 75 percent copper and 25 percent nickel, bonded to a core of pure copper. They are completely debased. There is no silver content.
There was a time in our nation’s history (not long ago) when goods were purchased with gold and silver coins, or paper dollars that could be redeemed in gold and silver (gold and silver certificates representing owner‑ or bank‑held gold and silver). Gold coinage ceased in 1934 by governmental decree. The mints produced the last silver dollars in 1935; silver quarters, half‑dollars, and dimes were discontinued for general circulation in 1965.
The poor usually are the first affected by the debasement of money because they receive the ability to purchase goods when the effects of inflation already have ravaged the economy. The poor may be unemployed or hold low paying jobs with little or no increases in salary. If inflation increases 10‑15% per year and wages only 2‑5%, a reduction in purchasing power results. Of course, those not able to work or dependent on charity, experience an even more grievous condition. The Bible maintains that inflation has its greatest effects on widows and orphans:
“Your silver has become dross, your drink diluted with water. Your rulers are rebels, and companions of thieves; every one loves a bribe, and chases after rewards. They do not defend the orphan, nor does the widow’s plea come before them” (Isaiah 1:22–23).
The very policies instituted by politicians to help the poor created the massive debt that now has turned on the poor and made them even more dependent upon government assistance. To deliver the promised programs of prosperity, the federal government took our nation off the gold standard and inflated the dollar with more and more paper “currency,” since the gold standard prohibited our political leaders from tampering with the money supply.
When the official protector of weights and measures, the civil magistrate, disregards commandments regarding sound money, what stops the general populace from gouging the poor as well?
The merchants of Amos’ day were cheating their poorest customers by making the bushel smaller when selling grain, adding base metals to the shekel, and tampering with the scales for trade: “Hear this, you who trample the needy, to do away with the humble of the land … so as to buy the helpless for money and the needy for a pair of sandals, and that we may sell the refuse of the wheat” (Amos 8:4–6).
Here is an area where civil government has legitimate authority to ensure that what is advertised as a certain volume is true (e.g. a gallon is truly a gallon). Civil governments, however, have no authority to regulate the monetary supply, or replace true money, gold and silver, with such easily inflated “legal tender” as paper and debased coinage that destroy the poor. Governmental programs intended to help the poor harm them because they cause inflation and decreased purchasing power for those holding the inflated dollars. By the time the poor can save enough money to purchase goods, the price has been affected by inflation
Since the civil magistrate is a minister of justice he also should punish those who defraud consumers through theft and misrepresentation. In Israel the poor were sold “the refuse of the wheat” for the real, advertised commodity (Amos 8:6).