The movement for sound money is gaining unprecedented traction across the United States, with more and more states introducing and passing laws to facilitate the use of gold and silver as money.
Mike Maharrey, a journalist and analyst at Money Metals Exchange, recently met with Jp Cortez, executive director of the Sound Money Defense League at Money Metals, to discuss the state of the movement, legislative victories, and the ongoing battle against inflationary policies that erode the value of the U.S. dollar.
The Sound Money Defense League: A Decade-Long Battle
Founded in 2014 and primarily funded by Money Metals Exchange, the Sound Money Defense League (SMDL) is a national public policy group dedicated to reintroducing gold and silver as legal tender. Its mission focuses on eliminating taxes and regulatory burdens that hinder individuals from using or investing in precious metals.
"Everything else that could function as money has been taxed and disincentivized," explained Jp Cortez, emphasizing how the current monetary system traps people in Federal Reserve fiat currency.
Over the last decade, SMDL, with Jp Cortez's leadership efforts, has worked to pass laws at both the state and federal levels.
In 2023, their efforts resulted in seven states successfully implementing sound monetary policies, making it their most productive year to date.
This year, they have already seen a significant increase in state-level participation.
The Power of State-Level Politics
Maharrey, who also works with the Tenth Amendment Center, noted that interest in sound money legislation has increased over the past two years, attributing it to growing public awareness of inflation and monetary devaluation caused by federal government policies.
Cortez highlighted the strategic importance of focusing on state-level legislation rather than federal initiatives, explaining that grassroots activism can yield real results in state capitals. He pointed out that state legislators are more accessible to voters than members of Congress and that state politics often influence federal action. He cited the recent legislative surge as evidence:
"Ten years ago, only a handful of states were considering sound monetary policies. Last year, over 27 states introduced more than 65 bills related to sound money."
Wyoming's Victory in Gold Reserves
One of the most significant victories this year occurred in Wyoming, where Senate Bill 96 became law without the signature of Governor Mark Gordon. The legislation establishes a $10 million gold reserve for the state, securely stored in Wyoming.
However, Governor Gordon expressed his opposition and published a two-page letter criticizing the bill. He argued that gold is not a good investment and claimed its only value is to sell at a higher price. Despite his reluctance, the legislature's decision sets a precedent for other states considering similar measures.
Wyoming joins Utah and Tennessee in gold storage: Utah holds nearly $50 million in physical gold, and Tennessee recently passed legislation empowering its state treasurer to invest in gold. More states are joining the sound money movement.
In addition to Wyoming, several other states are making progress:
- North Dakota is considering a bill that would allocate 1% of all state funds to gold reserves, approximately $10 million. The state treasurer is open to the idea, a promising sign.
- Montana is actively reviewing legislation to eliminate all taxes on gold and silver.
- Maine is reintroducing a bill to eliminate the sales tax on precious metals after a narrow defeat by one vote in 2022.
- Kentucky is facing a legal battle after its governor unconstitutionally vetoed a bill that repealed the state sales tax on precious metals. This year, lawmakers are reintroducing the repeal while also introducing measures to establish a state gold reserve and provide a legal avenue for taxpayers to sue the governor for undue taxes.
- Alabama is working on a bill to reaffirm gold and silver as legal tender, following previous legislative successes that repealed sales and capital gains taxes on precious metals.
These legislative efforts reflect a growing understanding that gold and silver provide protection against inflation and monetary instability.
Pressure for a Full Audit of Fort Knox Gold
Nationally, the issue of U.S. gold reserves is gaining attention. The U.S. officially claims to own over 8,000 tons of gold, making it the largest holder of gold reserves in the world. However, many, including members of Congress, are questioning whether that gold is actually present and free from encumbrances.
The last comprehensive audit of Fort Knox was conducted in the 1970s, but no thorough verification took place. No assays were conducted, serial numbers were not verified, and there was no independent review of ownership.
In 2019 and 2021, SMDL worked with Congressman Alex Mooney (R-WV) to introduce the Gold Reserve Transparency Act, which called for a complete audit of the United States' gold reserves. The bill emphasized the need for a physical inventory, a review of all transactions involving U.S. gold, and an examination of whether any portion of the gold has been exchanged, leased, or encumbered in any way by foreign or financial institutions.
With growing support from figures like Donald Trump, Elon Musk, Senator Mike Lee, and Ron Paul, the pressure for a full audit is gaining momentum. Cortez warned against another theatrical audit like the one in the 1970s, where selected bars were displayed before cameras without verifying the entire reserve. He emphasized that the U.S. gold holdings must be properly accounted for to restore public confidence in the economy.
The Road Ahead: Grassroots Action is Key
Cortez and Maharrey highlighted that public engagement is crucial for promoting sound monetary policies. The Sound Money Defense League provides a straightforward way for individuals to get involved through its legislative action list, which alerts subscribers to relevant bills in their states and provides contact information for key legislators.
The Sound Money Index, published annually by Money Metals Exchange and the Sound Money Defense League, ranks the 50 states based on their sound monetary policies. Those in states with low rankings are encouraged to take action by contacting their representatives and advocating for tax repeals, gold reserves, and legal tender laws.
As Maharrey noted, small policy changes complement each other, and grassroots action has already resulted in significant victories. Now that inflation is eroding the value of fiat money, the fight for sound money is more important than ever.
The battle for sound money is far from over, but with growing public awareness and legislative momentum, states across the country are taking crucial steps toward monetary freedom.
Here are the key questions and answers from the Money Metals podcast interview with host Mike Maharrey and Sound Money Defense League executive director Jp Cortez:
What is the Sound Money Defense League (SMDL) and what is its mission?
The Sound Money Defense League (SMDL) is a national public policy group primarily funded by Money Metals Exchange. Its mission is to eliminate taxes and regulations that hinder the use of gold and silver as money. The organization works at both the state and federal levels to introduce and pass laws that make it easier for individuals to invest in and transact with precious metals.
Why is the focus on state-level politics instead of federal politics?
State-level efforts are more effective because legislators are more accessible to voters. Calling a congressman may not yield results, but grassroots advocacy at the state level can have an immediate impact. Historically, state-level policy changes often influence federal action, making this a more strategic approach for promoting sound monetary policies.
What was the significance of Wyoming's gold reserve legislation?
Wyoming recently passed a law creating a $10 million gold reserve, securely stored within the state. The bill became law without Governor Gordon's signature, as he opposed it but chose not to veto it. This decision sets a precedent for other states considering similar measures and reinforces the growing momentum for state-owned gold reserves.
What other states are advancing sound money legislation?
North Dakota is considering a gold reserve plan similar to Wyoming's, allocating 1% of all state funds (approximately $10 million). Montana is reviewing legislation to eliminate all taxes on gold and silver. Maine is reintroducing a sales tax repeal bill after a previous attempt failed by just one vote. Kentucky is challenging its governor's unconstitutional veto of the sales tax repeal and is pushing additional sound monetary policies. Alabama is working to reaffirm gold and silver as legal tender.
Why is it important to audit the U.S. gold reserves (Fort Knox)?
Since the 1970s, there has not been a credible and thorough audit of the U.S. gold reserves. Previous audits only verified external seals rather than inspecting the gold bars themselves. There is growing concern about whether the gold is physically present and if it has been exchanged, leased, or encumbered in any way by financial institutions.
What legislation has been introduced to audit the U.S. gold reserves?
The Gold Reserve Transparency Act, originally introduced by Representative Alex Mooney, calls for a complete audit of the U.S. gold reserves. The bill requires a physical verification, checks on serial numbers, and a complete accounting of all financial transactions involving gold. With recent support from Donald Trump, Elon Musk, Senator Mike Lee, and Ron Paul, the movement to audit Fort Knox is gaining significant traction.
What role does grassroots activism play in advancing sound monetary policies?
Citizen engagement is crucial for passing legislation that promotes sound currency use. Many bills go ignored unless voters actively support them. The Sound Money Defense League provides resources to make it easier for people to contact state representatives, sign petitions, and support legislative initiatives. Small victories at the state level generate momentum for broader policy changes.
Mike Maharrey, JP Cortez, Money Metals