LETTERS: PAPER MONEY HAS NO INTRINSIC WORTH

To the editor:

In the U.S. Constitution, Article I, Section 10, it is stated: "No state shall ... make anything but gold and silver coin a tender of payment for debts."

The U.S. Treasury's various first attempts to create a paper form of money was with the very practical reason for the need to carry much less cumbersome and heavy forms of exchange than gold or silver, which are very dense and weighty.

However, simply printing paper money gave it absolutely no worthiness or value that could in any way equate to a world-recognized precious metal such as gold or silver. Silver and gold are still worth the amount paid on the world market in their raw state, whether they have been rendered into coin or not, because they have intrinsic value. The paper on which money is printed is not worth anything at all. Such is the written amount of a check valueless unless there are funds in an account to provide for redemption of that check.

Both the government and the American people knew that paper money was valueless unless it promised the equivalency of a given amount of precious metal that it represented.

As late as the 1930s during F.D. Roosevelt's administration, U.S. paper money had been created that stated on the bill's face that there was precious metal within the U.S. Treasury that would be paid on bearer's demand. This meant that any citizen receiving paper money as compensation for work or goods could then take this money to his bank and demand the exchange for gold and silver, having a true value. This promise on the face of the bill gave it true value. These bills were gold and silver certificates. In 1933, Roosevelt recalled gold certificates along with gold coins. In 1963, the Treasury Department began withdrawing silver certificates so that silver reserves could be used for coinage. But by 1965, coins -- with the exception of half-dollars, dimes and quarters -- were minted totally without precious silver content. Half-dollars were reduced to a 40 percent silver content, and by 1971 they too were being minted without any precious silver at all.

Meanwhile, the price of silver per ounce on the world market is four to five times the face value of the coin excluding even the added value put on its collectability. The price of a gold coin is approximately 15 times its face value.

By virtue of the fact that paper money today promises no redemption for anything of intrinsic value and minted coins also have no precious metal value, U.S. currency in recent years on the world market has been valued at 8 cents on the dollar.

Thus, government's deviation from our Constitution regarding the minting of coins as well as the original intent for creating a paper money worthy of gold or silver exchange have greatly depreciated the buying power of hard-working Americans both at home and abroad. Our entire economy hangs precariously on the ignorance and trust of the population.

The public mistakenly believes that compensation for all its years of hard labor in the form of dollars saved in various ways in banking institutions will safely see it through the years of possibly hard times, retirement and old age. But if our money has been reduced to worthless paper and non-precious metal, what will happen in an economic recession or depression? Does anyone believe the F.D.I.C. can bail all banks out across our entire country should we go belly up economically? Whatever the government's intention, it simply couldn't be done. If anyone has any doubt, think about the government's intentions and assurance to its citizenry regarding the imposed Social Security. It is anything but secure. I urge everyone to do his own research.

CAROL A. BURNETT

Cape Girardeau