Virginia might be striking its own “commemorative coins” in the near future as a way of raising funds for the state.
On Feb. 21, Virginia’s Senate passed House Bill 2236, which would authorize Virginia Gov. Robert F. McDonnell to direct the state treasurer to mint, “gold, platinum and silver coins for commemorative use that bear seals of the Commonwealth.”
The measure now makes its way to Gov. McDonnell for his signature to become law.
Originally the bill provided that the “commemorative coins” could be known as “Ginnies” and would feature George Washington or one of the seven other Virginia-born presidents. The legislation was later changed to require the pieces to depict Virginia’s seals.
The bill was introduced Jan. 12 by Delegates Robert G. Marshall and Jackson H. Miller. It passed Virginia’s House on Feb. 8 and was referred to Virginia’s Senate. On Feb. 16, it unanimously passed Virginia’s Senate General Laws Committee and then passed the Senate on Feb. 21.
While the legislation does not distinguish the “commemorative coins” from medals, a fiscal impact statement that accompanied the bill notes the difference in that, “Coins for currency or commerce are being processed and produced in government coin mints. Private mints produce custom made and collectable coins such as commemorative coins.”
While the legislation calls the pieces “coins,” the authority to issue legal tender coins in the United States rests with the U.S. Congress under Article 1, Section 8 of the federal Constitution.
However, several states have legally sanctioned state “coins” — bullion pieces — including California and South Dakota.
Marshall sees the bullion piece program as a fund-raising vehicle for the state. In public comments, he has distanced this piece of legislation from another bill he introduced on Jan. 12: House Resolution No. 557, which sought to create an alternative to the Federal Reserve’s dollar.
H.R. 557 — which ultimately failed — aimed to form a joint subcommittee to study whether Virginia should make preparations to switch to an alternative currency in the event of a breakdown of the Federal Reserve System and the destruction of the U.S. dollar.
Marshall has been an outspoken critic of the Federal Reserve System.
Federal Reserve concerns
Marshall’s legislation to create an alternative currency for Virginia is part of a growing movement of states considering a return to gold and silver backed currency.
The Federal Reserve System’s currency is not redeemable in gold or silver, and Virginia’s resolution, along with movements in several other states including Georgia, Indiana, Montana, New Hampshire and South Carolina, cites the lack of precious metals backing as one of the reasons, if not the primary reason, for the Federal Reserve’s instability.
The argument for alternative currencies is typically framed in constitutional terms, citing the police power that extends to states to protect the lives, health and property of their citizens. A key part of this protection is contingent on a robust economy, which, according to those who advocate for alternative, state-issued currencies, is not possible in the absence of a sound currency.
Marshall’s legislation noted the possible destruction of the Federal Reserve System’s currency through hyperinflation, which would throw Virginia’s economy into “chaos.”
The Marshall legislation adds, “Virginia can avoid or at least mitigate many of the economic, social, and political shocks to be expected to arise from hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System only through the timely adoption of an alternative sound currency. …”
In proposing an alternative currency of gold and silver, proponents say that it would give a state’s residents the chance to use a state’s currency alongside the Federal Reserve’s dollar, as an alternative rather than a replacement.
At the Virginia Capitol Correspondents Association dinner on Feb. 9, attendees received wooden nickels also known as “Bob Bucks.” One side features a portrait of Marshall with the legend in bob we trust and the reverse has a design similar to the Shield 5-cent piece with a 5 in the center surrounded by 13 stars and the legend commonwealth of virginia above the denomination ginnies. ■