If it seems like red states (especially Texas) are run by Ron Paul gold bug lunatics, it's because red states, in particular Texas, are run by Ron Paul gold bug lunatics.
Gov. Greg Abbott (R-Texas) signed House Bill 483 into law on Friday, which will establish a state gold bullion depository.
According to the governor's office, the law will repatriate $1 billion in gold from the Federal Reserve in New York to the new state depository.
The Officer of the Comptroller will administer the depository, which will serve "as the custodian, guardian and administrator of bullion" that will come to the State of Texas, the release said.
"Today I signed HB 483 to provide a secure facility for the State of Texas, state agencies and Texas citizens to store gold bullion and other precious metals," said Abbott in the release. "With the passage of this bill, the Texas Bullion Depository will become the first state-level facility of its kind in the nation, increasing the security and stability of our gold reserves and keeping taxpayer funds from leaving Texas to pay for fees to store gold in facilities outside our state."
Now, ask yourself why a state in the United States of America would need its own bullion depository, and to repatriate a billion in physical gold from the Federal Reserve. Does Texas plan to issue its own gold-backed currency or something? I mean, this is the kind of thing that might lead one to believe the state's leaders are getting rather serious about secession.
Tenth Amendment fetishists are certainly thrilled with the prospect.
In short, a person will be able to deposit gold or silver – and pay other people through electronic means or checks – in sound money. Doing so has the potential to open the market to sounds money in day-to-day transactions.
By making gold and silver available for regular, daily transactions by the general public, the new law has the potential for wide-reaching effect. Professor William Greene is an expert on constitutional tender and said in a paper for the Mises Institute that when people in multiple states actually start using gold and silver instead of Federal Reserve Notes, it would effectively nullify the Federal Reserve and end the federal government’s monopoly on money.
Gosh, I can't imagine why this wasn't an issue until 2009, but then again I recall a bunch of states decided they no longer wanted to be part of the US currency back in 1860 or so.