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Gold Confiscation: Gold Regulations
Nothing in the legislation that ended the forty-year ban changed the fact that Congress continued to treat the private ownership of gold as a privilege to be enjoyed at its discretion.
"The private ownership of gold is a privilege, not a right. Congress revoked the privilege of private ownership in 1933 and restored it in 1974. Congress could easily revoke the privilege again. In fact, at no time during this century has the U.S. government recognized the right of private gold ownership. The Trading with the Enemy Act, which President Roosevelt invoked in 1933 to restrict private gold transactions, remains law. The government could reactivate the machinery, which the Trading with the Enemy Act established, to implement gold confiscation."
- 5 Boston College International and Comparative Law Review 297,320 (1982)
The Treasury Department's 1954 amendment to the Gold Regulations continued the exemption of rare coins from the gold confiscation provisions and expanded the definition of "coins with a recognized special value to collectors of rare and unusual coins" to include "gold coins made prior to April 5, 1933." However, the repeal of the Gold Regulations in the 1970s resulted in the elimination of the relevant Treasury Regulations, leaving only the original definition: that of "coins with a recognized special value to collectors of rare and unusual coins," in place.
Several recent articles have suggested that the definition of rare coins for purposes of the exemption from confiscation was further expanded in 1984 to include gold coins the "gross proceeds from the sale of which exceed by more than 15 percent the value of the underlying... property." However, that definition was included in a proposed Treasury Regulation, which was introduced in 1984 and which has consistently been on the Semi-Annual Agenda of Regulatory Actions, but none of the relevant provisions of the proposed regulation have been adopted as law.
Although private ownership of gold in the United States was legalized on August 15, 1974, the power to confiscate gold remains in the hands of the President. The President still retains the right, under the Emergency Banking Relief Act, to "investigate, regulate or prohibit... the importing, exporting, hoarding, melting or earmarking of gold" in times of a declared national emergency. It is highly unlikely that either the Courts or Congress would successfully argue that confiscatory powers are not implicit in the Emergency Banking Relief Act if a currency crisis or other fiscal emergency prompted the President to, once again, nationalize gold.
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