A government can fund itself in a limited way just by relying on its power to coin money, but this in turn relies on the willingness of people to accept the coin of the realm. Some tax resistance movements have adopted the tactic of refusing to use government money. Here are a few examples:
- During the Russian revolution of , a coalition of anti-government groups issued a manifesto in which they made the case that the government was essentially bankrupt, and they urged people to withdraw their deposits from the banks in gold rather than in untrustworthy government notes, and to demand their wages in gold.
- During the American revolution, the Continental Congress funded its side
of the war by issuing its own paper money: “continentals.” They demanded
that these notes be accepted as legal currency throughout the colonies,
even as they sank in value. Refusal to accept continentals as real money
was seen as traitorous to the revolutionary cause, and indeed could result
in execution at the hands of a military court. Many Quakers, however, who
were unwilling to participate in war funding in this way, refused to use
or accept continentals, and the Virginia Yearly Meeting formally forbade
its members to use the notes. Job Scott wrote of this period:
I believed a time would come, when Christians would not so far contribute to the encouragement and support of war and fightings as voluntarily to pay taxes that were mainly, or even in considerable proportion, for defraying the expenses thereof; and it was also impressed upon my mind, that if I took and passed the money that I knew was made on purpose to uphold war, I should not bear a testimony against war that for me, as an individual, would be a faithful one. I knew the people’s minds were in a rage against such as, from any motive whatever, said or acted any thing tending to discountenance the war: I was sensible that refusing to pay the taxes, or to take the currency, would immediately be construed as a pointed opposition to the present war in particular; as even our refusing to bear arms was, notwithstanding our long and well-known testimony against it; and I had abundant reason to expect great censure and some suffering in consequence of my faithfulness, if I should stand faithful in these things; though I knew that my scruples were unconnected with any party considerations, and uninfluenced by any motives but such as respect the propriety of a truly Christian conduct, in regard to war at large.
- A number of modern critics see the government monopoly on legal tender as being a bulwark of tyranny, and are trying to attack it on a variety of new fronts, including modern twists on community currencies and entirely new plans empowered by networking and encryption developments.