PHOENIX — Arizona is returning to its gold rush roots with a bill that
would make precious metals legal currency.
The GOP-led Senate gave final approval Tuesday to the bill that could make
Arizona the second state in the nation to recognize gold and silver as legal
tender. If signed into law by Gov. Jan Brewer, the measure would take effect in
The state Department of Revenue opposed the measure. It passed in the House
only after an amendment was added to exempt the department from having to accept
gold or silver as tax payments.
The measure reflects a growing distrust of government-backed money amid the
declining value of the dollar, according to proponents. Republican Rep. David
Livingston of Peoria, a financial adviser who ushered the legislation through
the House, said his clients were eager to tap into their gold and silver
But Democrats, who voted against the measure in the Senate and House, said it
sends a false message to constituents that gold and silver are safer than
“This is too extreme,” Democratic Sen. Steve Gallardo of Phoenix said. “We
don’t need it.”
Democratic Sen. Steve Farley of Tucson said the measure is unnecessary and
would create long lines at businesses as store clerks inspect and weigh the gold
and silver. The measure would allow the use of precious metals as money only
when businesses agree to take them.
“Businesses are not clamoring for this, to say the least,” Farley said.
“This is basically growing the size and scope of government to create an
entirely new currency system.”
Farley noted that the price of gold saw a significant drop in early April, its
biggest one-day plunge since 1983. He said allowing gold and silver as legal
payment at grocery stores and other businesses would prove too unpredictable.
“Anybody who thinks gold or silver is a safe place to put your money had
better think again,” he said.
The Senate had previously passed Senate Bill 1439, but it was sent back for
final approval after the House amendment passed.
Utah became the first state to allow gold or silver payments in 2011. Lawmakers
in Minnesota, North Carolina, Idaho, South Carolina, Colorado and other states
have debated copycat laws in recent years. The Maine Senate and House recently
rejected a similar measure.
Gold-backed money fell out of favor during World War I because the U.S. and
many other countries needed to print more cash to pay for the war. President
Richard Nixon formally abandoned the gold standard in 1971.