Ron Paul Talks About Digital Gold Currency

By Mark Herpel
American Chronicle
Tuesday, October 30, 2007

http://www.americanchronicle.com/articles/view/41533

Digital Gold Currencies such as Liberty Reserve, Webmoney(WMG), c-gold, e-gold, Pecunix, GoldMoney, e-dinar facilitate Internet commerce around the globe without the risks of chargebacks, fraud or the high processing fees associated with credit cards. Anyone receiving a payment in digital gold currency has 100% immediate settlement. Get paid, stay paid and no waiting.

During an interview on March 9, 2002 by Bob Nugent for the planetgold.com (now defunct), Ron Paul discussed some ideas about Digital Gold Currency and free market money. The information and the interview are extremely relevant today as the US dollar drops lower and lower ahead of the coming Presidential Campaign. Here are some clips from the interview:

Bob Nugent for planetgold: Congressman Paul, you’re literally an outstanding member of the US House of Representatives. And, I mean that in the most positive way. And I’d like to thank you for taking the time for a short interview. Ah .. I understand that The Liberty Committee is about 3 years old. What are the sizes of the Liberty Committee’s caucus and membership, currently, and how’s it been doing lately?

Congressman Ron Paul: We have 17 members of congress who belong to, but probably have 60,000 citizens around the country who participate. And the goal is of course to put as much pressure on all the members of Congress to look to the Constitution to find out … to decide on how they’re going to vote. And sometimes it works and sometimes it helps. But we have a long way to go. We need probably a couple hundred thousand people doing that on a regular basis, to put pressure on their members of Congress.

planetgold: Well that’s good to hear and we hope the UN doesn’t get too far at all. In February of this year you introduced the “Monetary Freedom and Accountability Act”. It’s long title being: “To amend title 31, United States Code, to limit the use by the President and the Secretary of the Treasury of the Exchange Stabilization Fund to buy or sell gold without congressional approval, and for other purposes.”. Why did you introduce this bill?

Congressman Ron Paul: There’s a strong suspicion that our government, in the Treasury department and specifically Exchange Stabilization Fund are probably dealing in the gold market with the purpose of keeping the price of gold down. They deny this and maybe they’re getting around it some way. But I wanted to make it explicit that they can’t do it, that it’s illegal, because the interpretation of the law passed in the 1930s did give the Exchange Stabilization Fund some authority to deal in gold. But I want to change that. And I want it to be out in the open. And I want Congress to know about it, if they’re going to loan gold or sell gold. They claim they’re not doing it, but if that’s the case, the Treasury shouldn’t have any objections to a law like this, that just says that Congress is just resuming their responsibilities that they should have had, and should have had never taken away from them.

planetgold: Right. …. I’d like to read a quote supposedly of President John Adams, and then ask you what you think of it. It appears to me, at least partly, that it still holds true today. And, here’s the quote: “All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation.” What do you think of this statement?

Congressman Ron Paul: Well I think that he does place the morality of it all. Freedom doesn’t work unless you have a moral people. But I certainly would agree with him on this issue of ignorance about the coinage of the money. There’s so little interest in it and so little knowledge in Washington that it’s … it’s unbelievable. Even the committees that , like the banking committee that deals with it, or the sub-committee, the Domestic Monetary Policy subcommittee, those people that serve on there either get stuck on there, or they want to deal with not true coinage but just making the memorial coins or special coins for special occasions, like that.

As far as monetary policy goes there’s no interest and no knowledge about it and yet I consider that so significant. To me it’s the most important economic issue of the day. It’s the nature of money and the Federal Reserve system. It has a lot to do with ignorance but it’s also, I think, it’s convenient too. Because this way if the Fed is responsible for dealing with this major issue of money and banking, and also they know that the Fed can take care of debt that we can’t sell, and they keep interest rates down, I think it’s very convenient for the politician who likes to spend money. So it’s a lot of ignorance and a lot of convenience. But right now, I don’t know what it’s going to take to wake ‘em up. I think the Congress won’t wake up until the people wake up and realize the currency and the dollar is not a very good currency.

planetgold: Ok. Are you aware of private DGCs, Digital Gold Currencies, like e-gold, GoldMoney, e-Bullion, 3PPay and FastGrams?

Congressman Ron Paul: Yes I’m aware of this.

planetgold: Do you have any opinions on ‘em?

Congressman Ron Paul: I think they’re great. I don’t know any of them in detail. And I can’t compare them and tell which one is more efficient. I don’t have any opinion in that detail, but the the idea that we can have digital money and relate it to gold, I think is very very good. I think everything is vulnerable. Just because gold is a good idea doesn’t mean that everybody that comes up with this digital gold will be efficient and honest and all these other things. So that is required … the markets have to sort all that out.

I’ve been asked so many times about what we should do with the system now. If I don’t like the paper money and I don’t like the Federal Reserve, what would I do. And it generally is I wouldn’t get rid of the Federal Reserve in one day, because it would be very very chaotic. But I would like to fully legalize competition in currencies. And I think some of these currencies have .. or gold has trouble in really developing, getting people to use them, because the tax collectors can still come. If you’re using gold coins and your gold coins go from 300 dollars a coin to 400 dollars a coin, you could be taxed on the appreciation of that if you sell those coins and put it into paper. So, you have to eliminate all taxes. Sales taxes and capital gains taxes on gold coinage if we want to do anything to encourage the use of gold as a competing currency.

planetgold: DGCs are pretty much all offshore, right now, even though much of the action is being driven by Americans. In most cases, the central reason is that while the US might be the best place to do business, the Internet financial world is acutely aware that America has a past reputation of gold seizures, and a current and alarming reputation of asset seizures, all without due respect for normal human measures of property and legal process. What would have to be done to make people think America is a safe place for 100%-reserved gold money systems?

Congressman Ron Paul: Well, we’ve made a lot of progress. When I first went to congress gold wasn’t even legal. So in ‘76 with an effort we were able to restore legal ownership of gold. Technically contracts in gold are legal. We had the gold commission in the early 1980s. Something I was very much involved. We were able to get our government doing something that was constitutional. And, that was to mint gold coins, and that is where the Gold Eagle has come from. The precise one ounce of gold and silver. So in that sense we’ve made a lot of progress, but we have to always be concerned with what our government might do. They may confiscate our gold. They may confiscate our guns as well.

But in the mean time I think we should get as many people as involved … the more people that own a gun .. I don’t think the federal government could take the guns away from the American people. It’s just that .. there would be so much resistance, that it wouldn’t happen. There’s not quite the same resistance with gold. And I think that if we had the same attitude with gold as we have with our guns, … we’re not going to allow our government to overstep and do such a thing. But it lingers out there. I just don’t think that it’s likely to happen. But I wouldn’t bet that it’s impossible. I think it is possible. Of course that’s one of the reasons why I’m in Congress hoping to wake people up. To make sure that enough people know that we should not do that. But the danger still exists.

planetgold: Is the world’s financial system systemically sick?

Congressman Ron Paul: I don’t think there’s any doubt about it. I think it has a disease and is systemically sick but it’s one of those hidden diseases, and nobody quite realizes it. But it will show it’s ugly features probably here in the future.

planetgold: Is it conceivable that there comes a time when we can make a contribution to your campaign; and buy your cook books and bumper stickers with a Digital Gold Currency?

Congressman Ron Paul: Well, I would think so. I think some people may have, but I’m not sure in the practical sense, but if it works I think we would welcome it.

Mark Herpel is the editor of Digital Gold Currency Magazine and resides in Panama.

For further reading:
"Is Digital Currency Viable?", Timothy D. Terrell, March 15, 2001