The constitution. Questions?

[sgreger1]

Breaking from my usual stride I was wondering if some of those older/wiser than me can make some sense of some parts of the consitution for me. This is not political or related to anything about Obama.


Those who are more knowledgeable about the constitution than I please help me out as I am confident I am missing something here

US Constitution- Article 1 Section 10

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; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant anyTitle of Nobility.


So to me that sounds like you can't use paper money, or issue IOU's to people for their tax refund. But I am sure somewhere between the writing of the consittution and now this has been ammended or changed, but I can't find it?

Anyone have any info on this?

CA and others have issued IOU's before to people come tax refund time. Does this mean that it is illegal to do?

Bill of Credit
A bill of credit is some sort of paper medium by which value is exchanged between the government and individuals. Money is a bill of credit, but a bill of credit need not be money. An interest-bearing certificate that was issued by Missouri, and usable in the payment of taxes, was thus ruled to be an unconstitutional bill of credit.

[RobsanX]

You might find some info here:

http://en.wikipedia.org/wiki/Gold_standard

[RRK]

Those are rules that protect those rights of the federal government. Bills of credit is referring to making your own money.

[sgreger1]

You might find some info here:

http://en.wikipedia.org/wiki/Gold_standard

I know what a gold standard is, but since we no longer are on the gold standard, is it lawfull for a state to issue IOU's?

Something doesn't sound right about it.

[RRK]

You might find some info here:

http://en.wikipedia.org/wiki/Gold_standard

I know what a gold standard is, but since we no longer are on the gold standard, is it lawfull for a state to issue IOU's?

Something doesn't sound right about it.

As long as they aren't going to be circulated as currency I think they have decided that it is legal. It has been done other times.

[sgreger1]

True true. And yes it has been done here before. Okay that makes sense. It just words it as though you can't pay debts with anythign other than gold or silver. Thena gain, doesn't the fed reserve note count? It's used as a currency and is neither gold nor silver, and is not backed by either?

[RRK]

True true. And yes it has been done here before. Okay that makes sense. It just words it as though you can't pay debts with anythign other than gold or silver. Thena gain, doesn't the fed reserve note count? It's used as a currency and is neither gold nor silver, and is not backed by either?

But this article is just limiting the states. There is a lot I don't like about the fed but they are acting on behalf of the federal government who is not limited by this article.

[sgreger1]

True true. And yes it has been done here before. Okay that makes sense. It just words it as though you can't pay debts with anythign other than gold or silver. Thena gain, doesn't the fed reserve note count? It's used as a currency and is neither gold nor silver, and is not backed by either?

But this article is just limiting the states. There is a lot I don't like about the fed but they are acting on behalf of the federal government who is not limited by this article.

I hear you, but even if the feds are allowed to do what they want, aren't the states still binded to follow these rules stating that you can't pay debts with anything other than gold and silver?

[RRK]

I hear you, but even if the feds are allowed to do what they want, aren't the states still binded to follow these rules stating that you can't pay debts with anything other than gold and silver?

I think this was part of the federal reserve act or one of the laws that came out of the post civil war era since the country pretty much bankrupted itself in that war.