The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1935-02-07
BY I. ]. JR.

NEW YORK, Feb. THE gold
clause decision viii be one of the
most significant Supreme Court de-
cisions in history. 1t will be one OF
the most important constituting the
currency powers Of Congress.
The clauses in the Constitution
granting currency powers to Con-
greSs are few and brief. Congress
shall have power, in the words OF
the Constitution, ito coin money
regulate the value thereof, and OF
foreign coin, and fix the standard
Of weights and measures" Also il
shall have power TO provide for the
punishment Of counterfeiting the
securities and current coin of the
United States"
In that section Of the Constitu-
ton which restricts the actions of
the states We find also the state
ment that no state shall coin
money; emit bills of credit; (or)
make anything but gold and silver
coin a tender in payment of debts"
NO Strict construction.
The currency powers have not re-
ceived a strict construction, how
ever, at the hands of the Supreme
Court. Rather. the court had adopt
ed a policy Of liberal construction
comparable 70 that followed in its
interpretations OF other great sub
stantive powers Of Congress.
Referring TO the substantive pow
ers. Mr.. Justice Strong. writing the
majority opinion in the legal ten
der cases. said: They have never
been construed literally, and the
government could not exist if they
we're. Thus the power to carry on
war is tie power to declare war
The whole system Of the transporta-
ton Of the mails is built upon the
power 10 establish postofices and
post roads. The power to regulate
commerce has also been extended
far beyond the letter Of the grant"
Seven Powers Enumerated
The powers Of c -gress over the
currency have been extended
through liberal judicial interpreted
ton Of such powers much beyond
these ~discernible from a reading of
the Constitution. The Supreme
Court has recognized the following
powers Of Congress which are i'm
pOrtant in connection with the ma
TONS currency system:
1. The power TO establish a national
bank or system Of national banks pos
seSslnE authority. among other things. to
issue a circulating currency in the form
OF bank notes.
,. The power to conhne bank note cur
rency 70 that issuable under its own
jurisdiction as a means Of attaining a
uniform and sound bank currency.
g. The power 10 levy a prohibitive tax
upOn state bank notes as a means of
establishing a uniform and sound q
note currency under Federal control.
4. The power to issue. as an instru-
mentality Of war finance. an ineonvertible
or nat paper currency.
s. The power 70 prescribe that such
nat currency shall be a legal tender for
private rs well as public debts. even
though such designation may have the
effect Of reducing the value Of outstand-
ing contracts
s. The power 70 reissue such fat money
as a peacetime circulating medium n
TO continue IN such a time its legal tender
2. The power to issue coins Of the same
denominations as those already current by
law but OF less intrinsic value than these,
due 20 a reduc ION in metallic content.
debtors to discharge their debts BY the
payment OF coins Of the less real value"
Yet a number OF important ques-
tions relative to the scope of Con-
g%ressional authority in currency
matters remain unanswered.
Gold Clause a Puzzle
Foremost among such undecided
points is the question involved in
the gold clause cases. Is it within
the power Of Congress. in order to
carry out its policy in currency
matters. 10 abrogate, by Congress
siOnal resolution. the so-called gold
clauses in contracts? The Supreme
Court will answer this question
soon.
Another question of much impor-
tance which is likely 10 arise sooner
or later is whether the currency
powers Of Congress are sufficiently
comprehensive TO permit legislation
establishing Federal supervision W
all banks which deal in demand de-
posts and thereby provide bank de-
post currency.
Other unanswered questions as to
the currency powers of Congress
exist. For example, is there any
limit TO the power OF Congress to
issue coins Of the same denomina-
tons as those already current by
law but OF less intrinsic value be-
cause Of reduced metallic content?
Or. again. what are the limits with
in which Congress may delegate
power over the currency to the
President?
II viii be remembered that the So
called Thomas Imitation Amendment
10 the Emergency Farm Relief Act
Of 1888 granted extensive powers
over the currency TO the President.
Was this legislation constitutional?
Probably these and other qUes-
tionS concerning the limitations Of
the Constitution upon the currency
powers Of Congress will be answered
by the Supreme Court by the time
il has passed upon the validity Of
the various New Deal laws.