Last week federal agents raided the Idaho mint and the Indiana offices of the Liberty Dollar, an alternate currency advocated by libertarian activists. (They were working on Ron Paul Dollars at the time of the raid. Seriously.) The main man behind the Liberty Dollar is Bernard von NotHaus, who says once this gets to court he plans to "put this country's monetary system on trial." (Perhaps von NotHaus should consider changing his name before that endeavor.)
We'll leave the trial up to the authorities, but the Liberty Dollar story did get us asking a more general question: At what point does an alternate currency become illegal? If we create BPP Bucks and get people to sell us things in exchange for them, are we breaking the law? What if we convince New York City to let us pay our taxes with them? How big could these BPP Bucks get before Uncle Sam comes knocking?
It took us several days to find someone who could answer these questions, but we did it. On today's show we spoke with Walker Todd, former Assistant General Counsel and Research Officer at the Federal Reserve Bank of Cleveland, currently a research fellow at the American Institute for Economic Research. When I finally tracked him down he told me, "At any given time there are probably six monetary affairs attorneys alive in the country, and I guess I'm one of them."
Bonus: Read more about the Liberty Dollar on the Washington Post blog.
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