Sunday, April 13, 2014

Love me [legal] tender

Since recently withdrawing from all contemporary constitutional law matters, I’ve been revising a book I wrote/edited over thirty years ago entitled Government’s Money Monopoly which I hope to have published via Amazon in a few months. In short, the book is about how long ago as ancient Greece rulers (human and institutional) have usurped power over money. (The book is not for everyone, only those with a keen (self-destructive?) interest of how money became a monopoly of the rulers.)

A substantial portion of the book is about the Legal Tender Acts, about which here is a thumbnail sketch.

The North was strapped for money to fight the Civil War. To finance it, Congress enacted the Legal Tender Acts. The best way to explain them is by telling you about a piece of paper which is at this moment sitting on my desk.

It is a crisp $50 Federal Reserve Note (having no intrinsic value) that I once earned for fighting in the constitutional law trenches. In addition to containing various serial and other numbers, illegible signatures, a fancy seal, and a well-drawn pen-and-ink of President Grant, it bears (in almost unreadable type) this legend: “THIS NOTE IS LEGAL TENDER FOR ALL DEBTS PUBLIC AND PRIVATE.” Oh, yes . . . the back side is green.

Prior to the civil war, there were no paper greenbacks. If money, in whatever form, was proffered by a debtor in payment of an obligation, the creditor could insist on another form (unless a contract provided otherwise).
But during the Civil War who was going to accept ink-still-wet unbacked paper “money”?

So, unwilling to gamble and desperate to finance the War, the federal government’s Legal Tender Act made the greenbacks legal “money” and forced creditors to accept them upon pain of having what they were owed “legally” extinguished. 

Unsurprisingly, the Supreme Court went along with the charade.

Why am I telling you all this?

Because earlier today I was working on Justice Field’s dissent in the second Legal Tender Cases (Knox v. Lee).[1]

One does not often hear words like this today:
       For the reasons which I have endeavored to unfold, I am com­pelled to dissent from the judgment of the majority of the court. I know that the measure, the validity of which I have called in ques­tion, was passed in the midst of a gigantic rebellion, when even the bravest hearts sometimes doubted the safety of the Republic, and that the patriotic men who adopted it did so under the conviction that it would increase the ability of the government to obtain funds and supplies, and thus advance the national cause.
Were I to be governed by my appreciation of the character of those men, instead of my views of the requirements of the Constitution, I should readily assent to the view of the majority of the court. But, sitting as a judicial officer and bound to compare every law enacted by Congress and the greater law enacted by the people, and being unable to recon­cile the measure in question with that fundamental law, I cannot hesitate to pronounce it as being, in my judgment, unconstitutional and void.
In the discussions which have attended this subject of legal tender, there has been at times what seemed to me to be a covert intimation, that opposition to the measure in question was the expression of a spirit not altogether favorable to the cause, in the interest of which that measure was adopted. All such intimations I repel with all the energy I can express. 
I do not yield to anyone in honoring and reverencing the noble and patriotic men who were in the councils of the nation during the terrible struggle with the Rebellion. To them belong the greatest of all glories in our history—that of having saved the Union, and that of having emancipated a race. For these results they will be remembered and honored so long as the English language is spoken or read among men. But I do not admit that a blind ap­proval of every measure which they may have thought essential to put down the Rebellion is any evidence of loyalty to the country. The only loyalty which I can admit consists in obedience to the Constitu­tion and laws made in pursuance of it. 
It is only by obedience that af­fection and reverence can be shown to a superior having a right to command. So thought our great Master when he said to his disciples: “If ye love me, keep my commandments.”

[1] The case, covering approximately 124 pages in the Wallace edition of the Supreme Court opinions and 224 in another edition, has been edited in order to exclude the discussion of issues which are irrelevant to our present purposes. The full report of Knox v. Lee appears at 79 U.S. (12 Wall.) 457 (1871).