Utah going gold?

Is Utah moving towards a gold standard? Medals from the 2002 Olympics might become currency.

George Frey / AFP / Newscom / File
The front of the gold medal for the Salt Lake City 2002 Winter Olympics is displayed in Salt Lake City, Utah, in 2001. The image depicts an athlete bursting forth from flames and a mountain of ice and rock, carrying a torch representing the Olympic spirit, above the Olympic Rings. The 239 gold, silver and bronze 2002 Winter Olympics medals were made solely from metal mined in Utah.

The Salt Lake Tribune reports that Utah Rep. John Dougall at the urging of a constituent has committed to opening a bill file for legislation that would require the state of Utah to accept payments for licenses and whatnot in gold. Utah residents would even be able to mint gold and silver coins under the legislation.

“Fundamentally, what it comes down to is people’s concern about the fundamentally reckless policies at the federal reserve and what it does long-term to the financial standing of the country and giving folks another choice of monetary tools for their financial transactions,” Dougall said.

Sadly, the Tribune fished around for a quote on the proposed legislation and found Utah State economics professor Alan Stephens who says using gold as money is a mistake because there isn’t enough of it. The economy can’t grow unless there is more money created, according to Simpson. In other words if we didn’t have inflation the economy just wouldn’t go anywhere. Producers create goods and services only because the Fed creates money. That’s what they’re teaching at Utah State.

Simpson goes on to say parties can contract in gold if they want to anyway. Oh sure, good luck with that professor. Legal tender laws and all of that. In this book review from 1980 for the Freeman, John Sparks writes, “Why, if gold clauses are now legal once again, are citizens not generally making use of them to avoid the ravages of inflation?

“[Henry Mark] Holzer provides one legal answer to that question. Long-term loan contracts which require the borrower who repays in paper currency to repay more of the cheaper dollars, may violate state usury laws even where there has been a waiver of the defense of usury in advance. Holzer suggests a way that such a problem can be overcome by drafting a clause which states that ‘a given number of ounces of gold (either bullion or coins) of a certain fineness is being loaned and that exactly the same weight and fineness will be repaid.’”

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