South Carolina State Assemblyman Stewart Jones recently wrote about the Federal Reserve’s easy money policies in a piece for the Tenth Amendment Center.
He noted that “The days of cheap money will soon come to an end, and I fear that many people won’t realize what’s happening until the rug is pulled out from under them.” This was in reference to the Federal Reserve lowering interest rates twice so far this year.
Jones drew inspiration from economist Henry Hazlitt and explained that “the practices of the Fed distort the real-world market indicators of cost, future prices, investments and production.”
A new study from the National Association for Business Economics reported that 72 percent of economists believe that a recession will take place between 2020 and the end of 2021. Jones also points out that “the U.S. is on the brink of the biggest bubble in world history — not just a correction of a business cycle or another recession, but a complete collapse of the U.S. dollar.”
Unlike a lot of pundits and politicians, Jones recognizes the Fed’s role in causing the Great Recession of 2008. He set the the record straight by describing the Fed as the “greatest threat” to Americans.
With over $22 trillion in debt, $120 trillion in unfunded liabilities, and, soon, an all-time high debt-to-GDP ratio (comparable to World War II levels), however, it’s not overstating it to say that the Fed-facilitated out-of-control federal government spending constitutes the greatest threat to the American way of life in history.
The past century has witnessed the U.S. go from a sound money system to a fiat system based on debt. This has allowed politicians to finance massive government programs at the expense of the American populace. As the currency becomes inflated, those who saved in the currency are effectively being taxed. When money printing continues unabated, the threat of hyperinflation can become a reality. Countries like Venezuela have recently showcased how this can come about.
Jones is following in the footsteps of states like Utah who have allowed “gold and silver to be used as legal tender once again” by introducing the “2020 South Carolina Sound Money Bill.” This bill would allow South Carolinians to use gold and silver as legal tender. Although this won’t keep the Fed from debasing the dollar, Jones explains that the bill “will allow people to convert dollars to sound money before a collapse.” In Jones’ view, “Sound money, like gold and silver, acts as a check and balance on big government, a hedge against inflation, and a way to combat manipulation by the Fed.”
Since the federal government won’t take this issue on, it’s up to the states using the Ninth and Tenth Amendments to help restore sound money in America. Jones is one of the few elected officials that gets this.