9

In 1933, President Franklin Delano Roosevelt confiscated Americans' gold holdings. Apparently he did so through an Executive Order. How could this "fly" without Congressional approval?

In 2022, President Joe Biden signed an executive order to research a digital dollar to replace "currency" (the "Fed Now" program). A pilot program went into effect with 110 banks on July 26, 2023. That, according to my understanding, is within the purview of executive orders.

Can Biden or any other President complete the transition to a digital dollar by eliminating physical currency without Congressional approval. If so, under what political mechanism?

5
  • 3
    What does "complete the transition to a digital dollar" mean? Banking has been done using digital notation for centuries, and the Federal Reserve Bank has offered banking through digital electric signals at least since 1918. When you say "complete the transition to a digital dollar," do you mean "discontinue all physical forms of currency"? If so, "discontinue all physical forms of currency" would be a much clearer way of writing that. Oct 21, 2023 at 14:44
  • 7
    It's worth noting that FDR got away with a lot of super-sketchy things, perhaps in part due to his open threats on the integrity of the Supreme Court, many of which have been since overturned. Interning Japanese-Americans in prison camps (without probable cause of any crime and in direct violation of the Bill of Rights) comes to mind, for example.
    – reirab
    Oct 21, 2023 at 23:43
  • 5
    @reirab: Yeah, it's common for governments to exploit a "national emergency" to abuse their powers.
    – dan04
    Oct 22, 2023 at 4:05
  • 3
    You say "confiscated", the law said "exchanged for $20.67/troy oz".
    – RonJohn
    Oct 23, 2023 at 6:41
  • 1
    Can you say how a 'digital dollar' is equivalent to gold? Oct 23, 2023 at 21:28

1 Answer 1

25

FDR did have Congressional approval for gold confiscation, in the Emergency Banking Act of 1933, an amendment to the Trading with the Enemy Act from World War 1. Executive Order 6102 was signed a month later.

Naturally, people who owned large amounts of gold were not happy about the situation, and took their cases to the Supreme Court, who ruled 5-4 in favor of the Federal government.

Can Biden or any other President complete the transition to a digital dollar without Congressional approval.

No, the constitution (Art. I Sec. 8) explicitly gives Congress the power “To coin Money, [and] regulate the Value thereof”, so a President can't introduce a new currency unilaterally.

1
  • Maybe a nitpick, but the listed quote (Art. I Sec. 8) seems to not prohibit creating a new currency, but rather prohibit deprecating the existing currency. Unless "money" is defined as an aggregate of all currencies (if multiple exist)?
    – Flater
    Oct 22, 2023 at 22:07

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .