Governor Vetoes Crandell’S Gold Bill

Chester Crandall

Chester Crandall

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Gov. Jan Brewer Thursday vetoed a bill introduced by Sen. Chester Crandell (R-Heber) that would have made gold and silver coins and bullion legal tender in Arizona.

Crandell, whose district includes all of Rim Country, introduced Senate Bill 1439 and got it all the way through the House and Senate because he said the U.S. Constitution favors gold and silver as legal tender and gives the states the authority to produce their own money.

However, Gov. Brewer, also a Republican, in her veto message, said “while I believe the concern over a devalued dollar as a result of an unsustainable federal deficit is justified, I am unable to support this legislation. I believe the provisions in this legislation need to be more carefully examined and there should be prior coordination with those government agencies tasked with the oversight of these transactions.”

She continued that the law could impose “administrative and fiscal” burdens on both taxpayers and on the state’s department of taxation. “It is unclear whether this legislation would require Arizona to exempt income tax related to a transaction involving collectable coins or bills that were originally authorized by Congress and may be used as legal tender. This would result in lost revenue to the state, while giving businesses that buy and sell collectable coins or currency originally authorized by Congress an unfair tax advantage.”

In his first term in the Senate, Crandell moved up from the House back in November, thanks in substantial measure to his big margins in Rim Country over Rep. Tom Chabin, a Democrat who had represented Flagstaff and campaigned on a platform advocating tax reform and increased funding for education.

The Legislature handily adopted Crandell’s SB 1439. The bill would have left shop owners free to refuse to accept gold and silver for purchases. However, the Department of Revenue just scratched its head and shrugged when asked to estimate the potential financial impact. Local governments might have had to buy equipment to calculate values should someone decide to pay their property taxes in bullion.

Crandell argued that ooching back onto the gold standard — at least locally — moves us back toward constitutional principles and a sound money supply.

President Richard Nixon took the nation off the gold standard in the 1970s, revoking a provision that promised people holding paper money they could exchange it for gold. Many economists said linking the money printed to the nation’s gold reserve prevented the government from reacting to downturns by stimulating the economy. Some conservative economists maintain that decoupling the money supply and the gold reserves after 1971 allowed the Federal Reserve too much freedom to print money, with inflationary results.

Democrats did their best to mock Crandell’s bill as it rolled through the Republican House and Senate. Rep. Steve Farley (D-Tucson) suggested satirically that the Legislature also make the other elements of the state’s economic five-Cs legal tender, so that people could make purchases with bags of cotton, citrus and cattle.

Crandell didn’t appreciate the suggestion, according to a quote in Az Capital Times. “Some of these bills come from constituents and they feel very compassionate about what they are. To ridicule and make fun of a bill that is being put through I think is very unbecoming of the profession we have down here,” Crandell told reporter Ben Giles.

Crandell did manage to work through the Legislature and past the governor’s desk a bill that would set up a pilot program to pay school districts based on when students actually graduate, rather than for each day they spend in school. He maintained that schools would move students through more quickly and make sure they graduate if their funding depended on doing that.

No districts have as yet applied to be part of the pilot program.

This year Crandell also sponsored Senate Concurrent Resolution (SCR) 1016, which prohibits state workers from enforcing any federal action that the people have deemed unconstitutional — presumably without waiting for a federal court to interpret the Constitution itself. That bill never made it to the governor.

He also sponsored a measure to require science teachers to teach all sides of any controversial issues in science class, which many interpreted as an effort to make sure that science teachers teach not only the scientific theory of evolution but the Bible-based belief in creationism.

That bill also never emerged from the Legislature.

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