Constitution Article 1 §8.5 – Coinage, Weights, and Measures

This week I’m studying Article 1 §8.5 of the Constitution. It’s about the Congress’ power over coinage, weights, and measures. When I hear “coinage, weights, and measures” I think about how much stress I have related to my finances, my weight, and the shape of my body. I wish I could just leave it to Congress… yeah, actually I wouldn’t trust them with it. But Congress is in charge of money and weight at the national level.

I’m studying the Constitution, one clause at a time. I’m up to Article 1 §8.5.

Article 1 §8.5

The Congress shall have Power

To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;

If I had been at the Continental Congress, planning for a new nation, I don’t know if I would have thought to include this clause. Or maybe I would have been reminded every time I went out for my morning coffee (coffee has always been patriotic in America) and the barista insisted on payment in British pounds. My point is, standardization isn’t always the first thing we think of when we think of government. But it is one of the ways we identify a nation. French francs, Mexican pesos, Chinese RMB.

Money and the Value Thereof

The power “to coin money” and “regulate the value thereof” has been broadly construed as authorizing Congress to regulate all aspects of currency. McCulloch v. Maryland (1819) established that Congress can charter banks to issue currency. Veazie Bank v. Fenno (1869), established Congress may restrain the circulation of notes not issued under its own authority. I’m surprised those points needed to be established in court.

Regulating the value of money seems a lot more dicey than simply issuing currency. But it is, I guess, just another one of those things governments do. Anyway, there are cases establishing that creditors and contracts can’t specify gold instead of government-issued currency. And there are cases that establish Congress can forbid diverting money to other uses by defacement, melting or exportation.

The Value of Foreign Coin

So that bit about regulating the value of money and this one about regulating the value of foreign currency really makes me realize that I don’t understand how money works. When I first read it, I thought about China. I remembered something about how the Chinese government dictated exchange rates for RMB. That was supposed to be bad and messed with markets all over the world or something. I thought that meant the U.S. didn’t.

I found this 1806 law that establishes exchange rates and seems to say foreign money is acceptable as payment in the U.S. I’ve had taxi drivers in India ask for U.S. dollars, and seen prices listed in local currency and Euros when I traveled. I’ve even had cashiers in the U.S. ignore the odd Canadian coin in a payment. But I thought the only thing you could buy with foreign money in the U.S. was U.S. money.

I don’t get how money works. If you have a good resource that explains this stuff for beginners, please post it in the comments.

Standard Weights and Measures

I think it sucks that I can’t quite tell what people all over the rest of the world mean when they talk about temperature and distance. I think most people in the UK are even more familiar with metric units than we are in the US, where we desperately cling to the old British units. But at least a mile in Kansas is the same as a mile in Nevada.