The Monetary Future: Liberty Dollar Founder Convicted in Federal Court

Tuesday, March 22, 2011

Liberty Dollar Founder Convicted in Federal Court

By Chris Powell
Gold Anti-Trust Action Committee
Saturday, March 19, 2011

http://gata.org/node/9717

Here's hoping that yesterday's conviction of Liberty Dollar founder Bernard von NotHaus in federal court in North Carolina won't discourage the advocates of free markets in gold and silver and competitive currencies.

Those objectives were advanced by Liberty Dollar's seeking to put precious metal back into the hands of the people and back into circulation as currency. But the details of von NotHaus' conviction, as cited in the statement issued by the U.S. attorney for the Western District of North Carolina, Anne Tompkins, suggest that Liberty Dollar pursued those objectives in the wrong way -- a way the government was able to construe as more or less counterfeiting.

That is, Liberty Dollar's coins "were marked with the dollar sign, the words 'dollar,' 'USA,' 'Liberty,' 'Trust in God' (instead of 'In God We Trust'), and other features associated with legitimate U.S. coinage."

Of course the suggestion of counterfeiting was always a little silly, insofar as Liberty Dollar's coins were precious metal and general-circulation U.S. currency coins have all been base metal since 1965. How can a supposed counterfeit be worth more than a legitimate original? It's doubtful that any user of a Liberty Dollar coin was ever really confused about the difference.

But Liberty Dollar also was part of an organization that aimed to repeal the Federal Reserve System and thus was more easily construed as subversion. Certainly the Liberty Dollar operation was politically subversive, and the government seems to have gone nearly berserk about it precisely because of its politics.

"Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism," U.S. Attorney Tompkins said. "While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country. ... We are determined to meet these threats through infiltration, disruption, and dismantling of organizations which seek to challenge the legitimacy of our democratic form of government."

Undermining the legitimate currency of this country? Representing a clear and present danger to the country's economic stability?

Does the U.S. attorney mean undermining the currency that has lost something like 98 percent of its value since the enactment in 1913 of the Federal Reserve System about which the Liberty Dollar operation complained? Does the U.S. attorney mean a danger to the economic stability of the country that has been using that ever-devaluing currency, the country that has experienced only booms and busts and even a couple of depressions under the reign of the Federal Reserve? And by "democratic form of government," does the U.S. attorney mean the Federal Reserve System that, in secret, rigs markets and bestows virtually infinite patronage on the large banking houses that have been looting the country?

If undermining that currency and the economic stability of the country that uses it is really a crime, and if damaging democracy is really a crime, why haven't a few Fed chairmen been prosecuted?

As for the nececessity for the government to infiltrate organizations that might challenge the currency system, the Liberty Dollar enterprise functioned entirely in the open. It operated an Internet site and distributed press releases. Unlike the government, it wasn't in the business of keeping secrets. It seems to have been quite candid about what it was doing.

Nevertheless, Liberty Dollar probably was mistaken, legally and tactically, in its minting format, its using devices that could liken its coins to government coins. If the Liberty Dollar coins didn't use those devices, if Liberty Dollar had distinguished its coins by weight of metal rather than any dollar value and had imprinted on them some legend explicitly distinguishing them from government coins, the case might have ended differently -- or well might not have been prosecuted at all.

In any event the Liberty Dollar case was more a political case than a case of counterfeiting, fraud, or deceit. Indeed, the country probably has gained more from it -- gained some understanding of the currency system -- than the country has lost from the circulation of some precious metal coinage. U.S. District Court Judge Richard Voorhees should take this into account when sentencing von NotHaus.

Today's story in the Asheville Citizen-Times about the conviction of von NotHaus is here. And some sardonic commentary about his conviction can be found at Zero Hedge.