Alarmed by talk of a global currency, Rep. Michele Bachmann, R-Minn., introduced Congressional legislation Thursday to prohibit the president of the United States from striking any deal to validate a non-U.S. currency.
The bill’s introduction follows mixed messages from Treasury Secretary Timothy Geithner on whether he would support a global currency to replace the dollar.
On Tuesday, Bachmann tells Newsmax, she asked Geithner at a hearing if he would renounce any effort to move toward a global currency.
“He answered unequivocally that he would,” Bachmann said. Geithner’s assurances echoed those of President Obama.
On Wednesday, however, while speaking before the Council on Foreign Relations in New York, Geithner remarked that he was “quite open” to a larger, global-finance role for a melded International Monetary Fund currency.
That remark, widely interpreted as an endorsement of a global currency to rival or replace the dollar, had a galvanic impact on financial markets. Within 10 minutes, the U.S. dollar had lost 1.3 percent of its value against the Euro.
Fortunately for Geithner, the host of the Council event, Roger Altman, sensed something was amiss and gave Geithner an opportunity to amend his statement before the meeting ended.
“Let me ask the question this way,” Altman said to Geithner. “Do you see any change over the foreseeable future in the basic role of the dollar as the world’s key reserve currency?”
Geithner’s response: “I think the dollar remains the world’s dominant reserve currency.”
According to the Wall Street Journal, Geithner’s apparent flip-flop on the notion of a “currency coup” against the greenback led Chris Turner, head of foreign currency exchange at ING Bank N.V. in London, to write: "Like most new Treasury secretaries, he will have to quickly learn that there is little margin for error when discussing currency markets.”
Bachmann is less willing to dismiss Geithner’s remark as an inadvertent slip, however.
“Secretary Geithner has left the option on the table, and I want to know which it is,” Bachmann told Newsmax on Wednesday evening via e-mail. “The American people deserve to know."
Bachmann’s proposed bill is an effort to take a global currency off the table altogether. Her proposal is couched in the form of a joint resolution offering an amendment to the U.S. Constitution. It was introduced with 29 House cosponsors, including Rep. Ron Paul, R-Texas; Rep John B. Shadegg, R-Ariz.; and Rep. Marsha Blackburn, R-Tenn.
The amendment simply states: “The president may not enter into a treaty or other international agreement that would provide for the United States to adopt as legal tender in the United States a currency issued by an entity other than the United States.”
As with any Constitutional Amendment, it would face a tough uphill climb. Two-thirds of both the House and Senate would have to agree to it. Then three-fourths of the states would have to ratify the measure for it to become law.
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