South Carolina Legislator Calls For State To Adopt Its Own Currency

Are the winds of secession blowing throw the Palmetto State for the third time in history? Perhaps not, but one South Carolina legislator is calling on the state to create its own currency in case the Federal Reserve collapses:

Continuing a pattern of attempts to assert South Carolina’s independence from the federal government, State Sen. Lee Bright, R-Roebuck, has introduced legislation that backs the creation of a new state currency that could protect the financial stability of the Palmetto State in the event of a breakdown of the Federal Reserve System.

Bright’s joint resolution calls for the creation of an eight-member joint subcommittee to study the proposal and submit a report to the General Assembly by Nov. 1.

The Federal Reserve System has come under ever-increasing strain during the last several years and will be exposed to ever-increasing and predictably debilitating strain in the years to come, according to the legislation.

“If there is an attempt to monetize the Fed we ought to at least have a study on record that could protect South Carolinians,” Bright said in an interview Friday.

“If folks lose faith in the dollar, we need to have some kind of backup.”

The legislation cites the rights reserved to states in the Constitution and Supreme Court rulings in making the case that South Carolina is within its rights to create its own currency.

“The Supreme Court of the United States has ruled that the states may adopt whatever currency they desire for the purposes of performing their sovereign governmental functions, even to the extent of adopting gold and silver coin for those purposes while refusing to employ a currency not redeemable in gold or silver coin that Congress has designated ‘legal tender.’…” Bright’s legislation states.

The legislation claims “many widely recognized experts predict the inevitable destruction of the Federal Reserve System’s currency through hyperinflation in the foreseeable future.”

Per the legislation, South Carolina’s new currency could consist of “gold or silver, or both.”

It might surprise some, but there’s nothing about this proposal that would be unconstitutional. The Constitution does not bar the states from creating their own currency, and only provides, in Article I, Section 10, the following:

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

So, as long as they only use gold or silver, there’s nothing prohibiting from South Carolina from creating its own currency. Whether that’s a good idea from a policy point of view is another issue.

FILED UNDER: Economics and Business, Quick Takes, US Politics
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020.

Comments

  1. Chad S says:

    The “coin Money” part would tend to prevent a state from starting their own currency. Creating gold/silver currency to pay off the state’s debts is another thing.

  2. michael reynolds says:

    Wow. Yet another nut, yet another Republican. What are the odds?

  3. KipEsquire says:

    Your Article I, Section 10 analysis is flawed. “You can’t do not-X” does not imply “You can do X”

    The Gold Clause cases were unambiguous:

    The Constitution “was designed to provide the same currency, having a uniform legal value in all the States.” It was for that reason that the power to regulate the value of money was conferred upon the federal government, while the same power, as well as the power to emit bills of credit, was withdrawn from the states. The states cannot declare what shall be money, or regulate its value. Whatever power there is over the currency is vested in the Congress. –Norman v. Balitmore & Ohio

    Not saying I like it; just saying it is.

  4. sam says:

    Even if it could do it (as Kip demonstrates it can’t), the only folks I could imagine taking the “currency” would be establishments like Billy Bob Jim Roy’s Confederate Memorabilia and Corn Dog Shop.

  5. tom p says:

    I say, “Let them…”

    PLEASE…. let them….

  6. tom p says:

    Republicans are whacko and those who vote for them….. well, you can fill in the blank.

  7. EddieInCA says:

    And Doug would vote for this guy over any Dem.

    Go figure.

  8. walt says:

    Yep, “another nut,” “establishments like Billy Bob Jim Roy’s Confederate Memorabilia and Corn Dog Shop,” and “whacko.” (I used to live in South Carolina and was impressed by the people’s interest in and knowledge of their history; and, yes, the corn dogs are really tasty — lots better than coneys.) Tom P wants to “let them,” as if they need “our” permission, so that he can then, I imagine, enjoy the secessionist circus that would follow. Tom P, are you currently enjoying the Federal circus over at the Red Ink Reserve? Enjoy swimming in the National Debt? Love the sound of the printing press? Sam doubts whether South Carolina’s “money” would really be “currency.” I suppose that’s because those Southern rednecks lack expertise in ink production; they just can’t connect salvation with inflation. . . . Come to think of it: shouldn’t this website be called “INSIDE the Beltway”? Y’all git busy a learnin’ Chinese now! Come see us!

  9. thef150 says:

    I for one, being a native son of the state of South Carolina, am proud that we are taking action to protect ourselves from the dangers that currently exist in our economic climate. Many on this site choose to call us ‘backwards’, ‘redneck’ and throw dirt on our history. The state of South Carolina was instrumental in the cause of freedom from England and fought its own cause for freedom in the 1860s which many seem to want to mention. The great thing about this nation is that each state is unique and different. People from other states don’t have to like what South Carolina is doing and they should simply concentrate on their state. That is what makes the union work. When people in states try to push their will on the people of another state, however, that state has a right and duty to protect itself and its people. This is a study by the state of South Carolina for the citizens of that sovereign state. Read up on history. See what the true cost of freedom really is, what liberty means. It is only then you can truly appreciate the United States and what our country stands for. This isn’t a free ride and the government isn’t here to be your mother or father. This is a country founded by people with principals and morals much higher than many of the populous in the nation today. It is a nation founded on reverence, respect and a concentration on what is right. I only hope we can keep that freedom and liberty against the tide that weighs against it- not from the outside- but from within. My friends, South Carolina is not the enemy. South Carolina is a beacon of freedom. South Carolina is my state and I am proud to call her my home.

  10. chuckeasy says:

    I am from South Carolina and hear all the talk about history this and history that. B.S. I’m black my history in this state is slavery and unjust treatment based off my skin color. I’m not playing the race card but this was one of the last states in the union to end segregation. This state is the laughing stock of the Union. We have some of the dumbest people. Believe anything you tell them as long as the word Republican is behind it.