Washington Defaulted Forty Years Ago

by Will

Will Grigg?s Liberty Minute

August 3, 2011

During the overwrought and ultimately pointless Capitol Hill melodrama over raising the debt ceiling, the public was routinely told that it would be unprecedented for the federal government to ?default on its obligations.?

Let it first be understood that raising the debt ceiling is actually a way to continue evading financial obligations.

Secondly, financial affairs commentator Marc Joffe, former Senior Director at Moody?s Analytics, points out that the U.S. government has actually gone into default on at least three prior occasions ? most recently in 1979, when the Treasury Department failed to redeem roughly $122 million in T-bills.

The biggest default in American history, however, occurred in August 1971 when the Nixon administration severed the dollar?s connection to gold. As Charles Goyette points out in his book The Dollar Meltdown, this was done because foreign creditors, alarmed over the profligacy of Washington in fighting a distant war in Vietnam while expanding the welfare state, were demanding to exchange their dollars for gold.

Washington defaulted on its obligations forty years ago. Our deepening economic collapse is merely the long-deferred but inevitable consequence of living in a fiat money society.

Let us take back the liberty wherewith Christ has made us free.

No feedback yet