A push from ultra-conservatives — including Treasurer John Fleming — to allow gold and silver to be used as currency in Louisiana failed Monday in a bipartisan legislative committee vote.
The proposal from Rep. Raymond Crews, R-Bossier City, would have made Louisiana the first state to allow precious metals to be used to conduct direct transactions. But instead of flipping a gold coin Old West-style to a saloon barkeep, his bill would have allowed customers to place their precious metals in a depository in exchange for a debit card. Consumers would then be able to conduct a digital transaction just like they do with a standard debit or credit card.
Crews’ bill failed in a 16-2 vote from the House Commerce Committee. Reps. Danny McCormick, R-Oil City, and Dixon McMakin, R-Baton Rouge, were the only members to vote in favor, although McMakin peppered Fleming with a tough line of questioning about his fiscal claims.
The Louisiana Bankers Association opposed the legislation. Joe Gendron, the LBA’s governmental affairs director, said Crews’ bill would have set up a state-sanctioned bank. Fleming disagreed, saying he intended to seek bids from vendors to operate the transactional card service, and customers’ gold and silver would be stored out of state for the time being.
To explain how their proposal would work, the treasurer and Crews referenced Glint, a London-based card issuer that accepts gold deposits. That led some committee members to question why the state government needed to provide an option already available to consumers.
Gendron stressed to lawmakers that no other states have put such a currency system in place, although Crews and Fleming listed several states that were considering or had introduced similar legislation.
Gendron also pointed out the inspiration for Crews’ bill is a book, “Pirate Money: Discovering the Founders’ Hidden Plan for Economic Justice and Defeating the Great Reset,” by Kevin Freeman, published in 2023.
Before Gendron spoke to the committee, Crews acknowledged he had read Freeman’s book and said it supports the premise of his legislation.
The “Great Reset” is based on a conspiracy theory that the global elite have used the coronavirus pandemic to dismantle the U.S. economy and redistribute wealth to bring about radical social change. Freeman and like-minded conservatives seek a return to the gold standard with the end goal of replacing the Federal Reserve, the government central bank that sets monetary policy.
“This is a whole lot to ride on, one person’s opinion in a book that came out less than a year ago,” Gendron said.
Multiple committee members challenged beliefs from Crews and Fleming that consumers would not be adversely affected through capital gains taxes, similar to those a property owner has to pay when they make a substantial profit on a real estate deal. The treasurer and Crews said capital gains might apply if the customer ultimately sold their gold or silver holdings, but not to individual transactions or the moving of the commodity into a depository.
Ultimately, Crews and Fleming added, it would likely take someone to challenge the Internal Revenue Service in court to get a definitive ruling on whether the capital gains tax would apply.
Lawmakers balked at the idea of an ordinary citizen shouldering the burden of a legal challenge against the IRS.
McMakin pressured Fleming to determine whether the treasurer pursued an opinion from the state attorney general or the IRS on whether capital gains taxes could apply to commodity deposits or withdrawals. The treasurer would not respond to his questions with specifics, only saying he had pursued information.
Had the Crews’ bill been approved, he and Fleming said customers would have placed their gold or silver in a Texas depository until sufficient interest justified a Louisiana-based facility.
Lawmakers took issue with the likelihood a Texas institution would have collected transaction fees and other charges from Louisiana customers.
After the vote to send his bill to the House floor failed, Crews voluntarily deferred the proposal. It would take a two-thirds vote from the committee to bring it back up for discussion, meaning the measure is all but dead for the session.
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