GROVER CRISWELL'S CONGRESSIONAL TESTIMONY ON GOLD OWNERSHIP

I knew Grover Criswell and his wife, Dolly, on a casual; basis until 1978, when, just a year or two out of law school, Grover appointed me to the position of Legislative Counsel to the American Numismatic Association (I stayed in that position for many years, finally leaving at the end of my own presidency in 1995.

There are some who thought Grover to be a lightweight, but of all the presidents that I worked with, he understood the political process best and what the purpose of a legislative counsel was – namely to work with Congress, and to help the president testify (and to offer background information to members of Congress and theirs staff to aid in that process).

Back in 1978, Congress began the debate over whether the U.S. should compete with the Krugerrand. Treasury fought it mightily Hearings were held in the Senate Banking Committee, and some real heavyweights came out to make out the case of why the U.S. government shouldn’t be in the bullion business.

The ANA’s annual convention was going on in Houston (Grover had Judge Hofheinz's suite at the Astrodome) and he decided that we should go to Washington to testify. I wrote his prepared remarks and, as was my custom, a three minute summary that he could read into the record. I also took index cards so that I could jot ideas and concepts for Grover to respond to questions from Senators or even fellow witnesses. Should anyone ask, Grover was a big man and wound up in a coach seat. I was staff, but managed to get 1st class. (I immediately switched with him).

C. Fred Bergsten, a respected international economist and then assistant secretary of the Treasury, testified before the Senate Banking Committee instead of Secretary W. Michael Blumenthal. He declared, “The [Carter] Administration believes that issuance of gold medallions would be unwise and inappropriate for several reasons, which he enumerated.

First, he said, “the issuance of these medallions would tend to create the erroneous impression that the U.S. government needs to supply the public with an officially issued gold piece as a hedge against inflation.”

Second, “the production and sale of an American medallion... could be interpreted as a U.S. government effort to encourage investment in gold. “

Third, issue of gold medallions “would be inconsistent with U.S. policy of continuing progress toward demonetizing gold.”

He postulated that, horror of horrors, a legal tender version of the medallions might follow – or that the medallions themselves would be monetized.

Dr. Edward M. Bernstein, a respected economist who formerly was a high Treasury Department official, active with the International Monetary Fund, and the Bretton Woods agreements, also spoke out on economic and policy grounds.

An apologist for the official, long-held view that gold ownership should not be allowed privately, and that the metal should be demonetized, Bernstein’s positional history carried a lot of Congressional weight. He was professor of economics at the University of North Carolina, 1935-1940; principal economist for the United States Treasury Department, 1940-1946; assistant to the secretary of the United States Treasury Department, 1946; research director of the International Monetary Fund, 1944-1958; President of EMB (Ltd.) Research Economists, 1958-1981; and guest scholar at the Brookings Institution beginning in 1982.

His advice, on the day that gold topped $198 an ounce in London: “it’s a terrible mistake to offer Americans this extra inducement to buy gold coins.” His rationale: ”it is really not right for the Government of the United States to offer an inducement to people to buy gold coins by giving them a nice looking medallion for which they would have to pay 12 percent above the bullion value.” Put differently, “it’s not a good hedge”.

Standing up for the right to own gold, and for the medallions was then-President of the American Numismatic Association Grover C . Criswell, Jr. I accompanied him, and wrote his written testimony, as ANA legislative counsel.

Criswell’s summary of five reasons why gold medallions were appropriate (it being obvious that Congress was at least several years away from authorizing gold coins): (1) it helps the balance of payments (2) clear domestic economic beneficial effects from the sale, (3) Denies $600 million in assistance to South Africa (4) returns gold to the people who have it to the government in the first place – the American people and (5) raises more money than the government’s auction plans for gold bricks in $80,000 units and above,

Bernstein then went on in the questions and answer portion to recite the proposition that “gold is gold. A person who buys a Krugerrand has just the same gold... My objection to the medallion is not that we are selling the gold but that we are putting the symbol of the United States on it which will make it more attractive.”

As future events would show, gold is not gold – and U.S. legal tender gold coinage consistently sells for more than the South African counterpart.

From August, 1978 until January, 2013, gold has gone up, down. But those who would have bought bullion then (or gold medallions when they were finally authorized in November, 1978 by Public Law 95-620), and issued in 1980 and afterwards, didn’t do that badly.

Grover Criswell’s fight for gold medallions (which ultimately became American Arts Gold Medallions)was on the right track and the result eventually led to private gold ownership. Grover took any of my index Card suggestions and broke into discussion and just pitched the ideas.

Grover and I travelled back to Houston uncertain of what Congress would do, but I was proud that he could take an index card with just a couple of words on it and speak for two or three minutes about it. That night back in Houston at the Astrodome, Grover held a party that they still talk about. But that’s a story for another day...

To read the earlier E-Sylum article, see: MORE ON GROVER CRISWELL (www.coinbooks.org/esylum_v16n06a11.html)

Wayne Homren, Editor

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