The Misesian (TM): Jp, it was great having you as a speaker at our Mises Circle in Albuquerque. Can you explain for our readers the Sound Money Defense League and your work in promoting sound money efforts across the country?
Jp Cortez (JPC): The Sound Money Defense League is a national nonpartisan policy group working to remonetize gold and silver. We do that at the state and federal levels, primarily by advocating legislation that removes the legal disincentives to actually using gold and silver.
At the state level and at the federal level, there are taxes and regulations and other impediments that keep people from not only buying and selling gold and silver to store as an asset, but also from functionally transacting with it.
Since 2014, we’ve worked on hundreds of pieces of legislation. Just this past year, there were more than 115 pieces of legislation that were being considered across 35 states in the country. The vast majority of these states are actively considering policies to allow people to readopt their own gold standard.
The financial system today is largely one of surveillance. It’s used not only to spy on individuals and citizens, but also as perhaps the primary means or lever with which the government pursues its policies. That is the urgency around restoring sound money, some sort of handcuff to a government that has shown that it will continue spending, continue fighting wars, continue growing despite not having the means or the financial capacity to really do so responsibly.
TM: Inflation has been one of the biggest political topics for several years now. Nothing’s being done about it at the federal level. What kind of reception have you gotten from state capitols on this issue?
JPC: We understand that inflation is largely a problem that starts at the federal level. It’s an ineffectual Congress. It’s an executive branch that will continue to grow and grow past its constitutionally permitted powers. But that doesn’t mean that there aren’t things that states can do to mitigate some of this damage.
At the state level, the growth and the interest in these policies have been tremendous. We started in 2014, and at the time, there were not many states considering this. There were no states eager to remove taxes on precious metals to reaffirm them as constitutional legal tender or even to establish their own gold reserves. Today, that has completely changed.
We’ve seen that this topic has become more and more pertinent in part because inflation is no longer deniable. There is this giant problem that once was relegated to economics classrooms that has now permeated dining rooms and living rooms. And these very real problems are no longer able to be hand waved away with “Leave it to the experts,” “The Federal Reserve knows what it’s doing.” I think more and more we’re seeing that Americans are not as open to this idea that “experts” know what’s best.
TM: Last year there was a moment of renewed interest in auditing Fort Knox, but that has clearly died down. You wrote an article criticizing Rand Paul for dismissing the need for a true audit after taking a tour with Treasury Secretary Scott Bessent at Fort Knox. Can you explain why this issue matters and where Senator Paul was wrong?
JPC: The United States purportedly holds 261 million ounces of gold. This is supposedly the largest stockpile of gold in the world, and it’s been an American asset for decades.
Recently, Secretary Bessent has been going on TV, talking about potentially remonetizing that side of the balance sheet. He was talking about getting creative or clever about doing things to enable these kinds of windfalls, such as revaluing the gold, which today is statutorily priced at $42.22 an ounce, to the current market price, which is currently around $4,500 an ounce. In doing so, the United States would free up trillions of dollars that it potentially could use to pay down the debt or “stimulate the economy.”
For many years now, there have been legitimate questions surrounding the quality and even the presence of the gold that’s supposedly stored at Fort Knox and in other vaults around the country. The gold that’s stored at Fort Knox and in Denver and in New York, this is America’s gold. This is the gold of American taxpayers, not the gold of the United States government. To that end, American taxpayers deserve transparency and deserve answers to some of these questions.
The issue is that for decades, the United States government has been less than forthcoming about the standard or the quality of American gold. There are questions as to whether the gold is physically there. That in itself is a legitimate question. But on top of that, even if the gold is physically present, there are questions surrounding ownership of America’s gold. Who owns it? Has it been pledged or leased or swapped or financially encumbered in any way? Has it been used in interactions or transactions with the IMF or the Bank for International Settlements or the World Bank?
On top of the constant in and out at these vaults, it is known that the auditing standards for Fort Knox and other American vaults would not pass muster at private depositories. They’re saying, “We checked it in the 1970s. We don’t need to check it again because we know the box has still been closed.” But anyone who is in the depository space, or even the financial auditing space, knows that audits are not one and done. These are ongoing checks.
So the Gold Reserve Transparency Act, which is legislation we’ve been working on at the federal level with Congressman Thomas Massie and Senator Mike Lee, among others, would call for a full audit and accounting of America’s gold.
This recent episode with Senator Rand Paul was incredibly disappointing because Rand Paul, who was a sponsor of the Gold Reserve Transparency Act, has a special relationship with Ron Paul, who is a sound money champion and hero. To have him then go to Fort Knox and, within a few hours, say, “All the gold is there. Don’t worry. I checked,” is a slap in the face to anyone who has given any attention to this issue at all. The worst part now is the steam and the excitement and the energy behind getting one of these audits actually done—all of the wind was completely pushed out of its sails because now any Treasury or administration official is going to look and say, “What are you talking about? Ron Paul’s kid was in there nine months ago, and he said it’s all good. You guys need to calm down with these conspiracy theories.”
That is not acceptable or sufficient as an audit.
TM: You graduated from Auburn University and attended several Mises Universities during your time there. Can you speak to the impact those experiences had on your work now?
JPC: It was a life-changing experience for me. I remember my very first Mises U, sitting at the introductory lecture that was given by Tom Woods, where he said, “This will be the intellectual experience of a lifetime.” At the time, I didn’t really know what that meant.
But many years later, I can look back and pinpoint this experience as the one that launched me on this now more-than-a-decade-long career fighting for and advancing the principles of sound money. The experience that I had at Mises University, getting to have one-on-one time with legends, with heroes that I’d been reading for years, those late-night discussions—it was an environment that lent itself to learning in a way that was so different from what I was doing literally across the street while I was paying tens of thousands of dollars every year to attend Auburn University.
Looking back, these are still to this day some of my best friends, some of my greatest colleagues, some of my professional resources, the people that are out there fighting for ending the Fed or restoring sound money or reducing the bureaucratic state or ending wars. These are people that were sitting next to me a dozen years ago while I was at Mises U. I can’t thank the Mises Institute enough for undeniably setting me on this path.
In today’s world, some people say, “Oh, well, there’s only going to be one company that will dominate social media.” Or they’ll say there’s only going to be one AI company. And we’ve already seen that that’s not the case. The only cartels and monopolies that do succeed are the ones created by the government. And those lead to reduced quantity, reduced variety, higher prices, and so on and so forth.
TM: Any brief thoughts on the future of the sound money debate?
JPC: I think that there is definitely reason to be excited about the future of sound money at the state level. There are literally dozens upon dozens of pieces of legislation to remove sales and capital gains taxes on metals, to establish gold reserves, to empower treasurers and state pension fund managers to invest in gold, and to establish gold-based state pension funds. And we’re seeing more interest in sound money at the state level because of these efforts.
The political reality is that you’re never going to get Congress to pass a law saying, “We’re establishing a gold standard.” You’re never going to get President Trump to issue an executive order saying, “We’re returning to sound money.” But I think, and I know this because of the time I spent at the Mises Institute, that more important than these top-down, one-size-fits-all efforts is the Hayekian idea of bottom-up approaches. I don’t need the federal government to establish a gold standard. Instead, what I can do is go around and remove the impediments and the disincentives keeping people from readopting their own gold standard or even ultimately creating more of a market for money.
Competition in money is something we haven’t seen in decades. And when we remove the briar and the thistle that stand in the way, we can see an innovative future for money. The hope is that we’re creating a market for alternatives or competition in money. Then, of course, what follows is the hypothesis that if given the choice, people would prefer a money that holds its value. People would prefer money that isn’t used as a political cudgel. People would prefer money that isn’t used to bomb kids overseas in places most Americans can’t find on maps.
If given the choice, people might prefer a money that holds its value, that is inflation-proof, and that is politically neutral. And we’re giving people that choice.
