Rep. Nate reintroduces gold savings bill. A major donor must be watching closely
Rep. Ron Nate, R-Rexburg, has reintroduced a bill that would allow the Idaho treasurer to invest idle state money — money that would otherwise be sitting in a bank deposit — in silver and gold.
The same bill was introduced last year and passed the House easily before dying in the Senate.
Seems like a strange, oddly specific bill to keep rising from the dead year after year.
There are some decent reasons you might not want your idle tax dollars sitting in gold. For one, the price of gold is crazily volatile — prices swing up and down at random by large amounts on a daily or weekly basis. If your investment is in physical gold, you have to actually transport it in order to sell it. The price you get by the time you successfully sell your gold might be very different from the price when you decided to sell.
That makes precious metals very different from the other forms of investment the treasurer is allowed to invest idle money in: government bonds, cash deposits, conservative money market funds and the like. All have pretty predictable prices and returns, are easy to liquidate quickly and are pretty hard to steal.
Gold, on the other hand, is volatile, hard to sell quickly and easy to steal.
So why, year after year, all the clamoring to allow idle funds to be used to hold physical quantities of gold?
A cynical person might think it has something to do with a company called Money Metals Exchange and its owner, Stefan Gleason.
Gleason has been a prolific donor to Nate and allied lawmakers for years. Gleason gave Nate max $1,000 contributions in February 2020 (a second max contribution came from Money Metals Exchange that month), June 2020 and December 2021. He’s shown similar beneficence to Reps. Tammy Nichols, Heather Scott, Dorothy Moon, Priscilla Giddings and Julianne Young. All but Young were cosponsors of the 2021 bill, though she voted in favor of it.
One peculiar thing about holding physical gold — rather than, say, gold futures or derivatives, which Nate’s 2021 bill expressly forbids — is that you need a safe place to store your gold because it’s easy to steal and sell the stuff.
Nate’s bill requires the state to use a “depository for precious metals constructed, at minimum, to Underwriters Laboratories class two standards and located within the geographical boundaries of the state.”
But are there any such facilities in Idaho? Luckily, and surely coincidentally, Money Metals Exchange offers a depository “in low-crime Eagle, Idaho, with the county sheriff’s office located on the second floor” that uses “top-of-the-line UL Class 3 vaults.”
What good luck. They even advertise “low storage fees.”
Assuredly, there is no relationship between Money Metals Exchange’s and Stefan Gleason’s prolific donations to right-wing lawmakers and those lawmakers’ sponsorship and support for legislation that could give that company a financial windfall.
That would be crony capitalism, and Nate and his crew detest crony capitalism.
Stop being so cynical.
This story was originally published February 2, 2022 at 11:01 AM.