Government Seizures Part 1

Did you hear the story of the family who found gold coins worth millions of dollars? Now the government wants their “Fair Share” of it in new taxes, at the top rate no less. This brought to mind the countless ways federal and state government seizes property never belonging to them. From real estate properties, gold and currency, even people, the Government makes it common practice to take what they want and what THEY deem their just deserves. This will be part 1 in a 3 part series on government seizures.

If you like your gold you can keep your gold.

April 5^th 1933 the United States President Franklin Delano Roosevelt signaled the end to gold backed currency with his signature on Executive Order 6102. And so began the decline of American currency thereafter. It was actually earlier in the same year, March 6^th 1933 to be exact, that President Roosevelt issued Presidential Proclamation 2039 forbidding the hoarding of gold by individuals. EO 6102 required that all persons to deliver to the nearest Federal Reserve all but a small amount of gold coin, bullion or certificates. The Federal Reserve was to issue an exchange of$20.67 per troy oz., in today’s money that would be worth $378.58. The order permitted individuals to own up to $100 in gold coins (at face value of 5 Troy ounces). It also exempted gold coins of certain specification, unusual or rare coins. This was to try and protect certain rare varieties of coins to from being melted.  American Citizens were not the only ones affected by this legislation. Foreigners who held gold in American companies, either bullion, coin or certificates were all forced to accept the paper currency alternative. Even private contracts whose terms were decided prior to this law were nullified by this legislation and were also required to honor the contract without gold but with paper currency.

After the Government had gotten a lot of the gold out of the hands of citizens it raised the price of gold from the Treasury for International Transactions, giving the US government a fairly sizable profit from the seizure. This profit was then used to fund the Exchange Stabilization Fund set up under the Gold Reserve Act of 1934.

With the swift action of the pen FDR had taken wealth from every home and converted stabile money to worthless paper currency. Years that followed show the effect of this decision, as the Great Depression raged on and many of the citizens were left homeless, jobless, and hopeless.

The government got away with it then….And they can get away with it again.

With the rise of digital currency the incidents involving seizures have been almost the same. Silk Road and Liberty Reserve are the most well-known cases of seizure of monetary assets. It is no surprise however that the government has gone to this as digital currencies have put pressure on conventional use of Federal Reserve notes and the increased anonymity of the digital users. Conventional use of paper currency has been turned on its head in the “crime” world by the up and coming array of various digital currencies, and Law enforcement is having an increasingly hard time adjusting to this trend, this is not to say that the use of currency in paper form has gone away, it has retained its use for illicit activity. Still they march on in hopes of stopping this monetary revolution.

Liberty Reserve and Silk Road are the two major digital currency service providers to have had their assets and property seized by Federal Agencies. The seizure of these digital currencies is like the seizure of conventional currency and property. The government can seize it, hold onto it or get rid of it, and fund themselves with it, but is it any less of a theft of property? The digital realm is expanding in ways that we have never seen before and people are turning 1’s and 0’s into amazing and fantastic things (3D printing), services (web space management and social media), and even properties (web domains).

Conventional Money Seizures

Conventional Currency seizures have been happening ever since money and government has come into existence. Your local sheriff’s office or Police department probably has a few cars that say something like, “bought with seized drug money”. They maybe even fund their departments with this “revenue”.  When the War on Drugs escalated in the 1980’s so did seizures of money, and in large quantities.  Taxes are the most noticeable theft of wealth and inflation is the most prevalent form but hardly noticeable to the general populace.

The case of the seized gold in California just reiterates the fact that the government can rob you of your wealth without recourse. It is a crime left unpunished by a system with a monopoly on force and a populace unwilling to demand answers and actions to correct this atrocious trend.