originally published July 12, 2013
Next time you flip a coin, you should take a moment to pause and reflect on the lengthy journey the concept of the coin has taken to arrive at this very instant, determining your fate. Actually no, don’t do that. It’s stupid, and besides, you’ll probably get distracted and miss catching the coin, which will lead to a huge argument as to whether or not the coin toss counts after someone had to use a coat hanger to drag the thing out from where it landed under the refrigerator.
Tell you what, I’ll take care of the pausing and reflecting for you. As someone who has historically had a somewhat antagonistic relationship with money, I am nonetheless curious about its origins. Perhaps by paying it the respect of a thousand of my words, some extra money will honor me with its presence in my wallet.
It’s cruddy logic, but it’ll do for now.
Back in 1791, most American retail transactions took place with the use of British currency, beaver pelts, shiny trinkets stolen from indigenous people on long voyages, or clumps of human hair. President George Washington felt America could do better. The following year, the United States Mint was established and the Coinage Act of 1792 set into motion the money system still in use today.
Not wanting to leech off British terminology, the ‘pound’ as a monetary standard was out. Instead they harkened back to the Bohemian Joachimstaler, first minted in the 16th century. This term had been shortened to ‘taler’ in German, and eventually changed to ‘daler’ in Danish and Swedish. It was the Dutch leeuwendaler (with a lion etched on one side) which came to be known as ‘lion dollar’ in English, and that was the term that the US Mint picked for their money. If your friends are sufficiently impressed by this little story, they might even pick up the tab at dinner! Let me know if that works.
The Coinage Act of 1792 stated there would be three coins minted from gold: Eagles ($10), Half Eagles ($5) and Quarter Eagles ($2.50). Silver coins would be dollars, half dollars, quarters, dismes (they’d later drop the silent ‘s’ because America don’t run on no silent ‘s’ bullcrap), and half dismes – nickels wouldn’t show up until later. Cents and half cents were made from copper.
The rules were, one side of each coin was to feature a symbol of liberty, as well as the word ‘Liberty’ in case some people were slow and couldn’t interpret the symbol. The other side got an eagle and the name of the country, as well as the coin’s denomination. Section 19 of the Act is the only portion of the legislation that hasn’t been overwritten since, declaring a penalty of death for any mint employee who messes with or tries to steal the gold or silver being used for coins.
Since almost no coins today are minted using silver or gold, that part of the Act doesn’t get brought up very often.
The Coinage Act of 1834 tweaked the ratio of metals in US coins, since silver was becoming severely undervalued. At this point, banks were issuing their own paper notes in amounts between $0.01 and $2.50, but the government wasn’t ready to make the switch yet. In 1849, thanks to the gold rush in San Francisco, the government authorized a pair of new gold coins – a dollar and a Double Eagle ($20).
The US Mint still had a policy not unlike that Cash-4-Gold place – people could bring in their gold and silver and have them melted down into coins. This was completely literal – the dollars and quarters in your pocket when you left would be made from the actual silver chamber pot and the silver marital aid you’d brought in. That policy, which in retrospect probably made it quite easy to fence and destroy stolen property, was dropped. With the Coinage Act of 1857, the half-cent was dropped too. It would be 165 years before a North American country (Canada, for those who haven’t been following the news) would be the next to drop its lowest-ranked coin, in our case the penny.
The Coinage Act of 1864 introduced the two-cent coin, which lasted only nine years before law-makers decided it was a pointless denomination and cancelled it. The two-cent coin did set a bit of history in motion though, being the first to feature the phrase “In God We Trust”, which would come to replace “E Pluribus Unum” as the official national money-motto in 1956.
The Coinage Act of 1873 was a bit more bold. In addition to scrapping the two-cent coin, this Act also gave the silver industry a long, shiny middle finger, declaring gold to be the only metallic standard in the land. The half-dime was also tossed in the trash, as was the three-cent piece, which had been snuck into circulation, most likely as a practical joke in 1851.
This Act sparked a massive political controversy which lasted throughout the rest of the 19th century. All those pioneers in big hats out west were somewhat less than pleased to learn the silver they’d been mining on the Western frontier was getting the ass-end of the proverbial monkey from their own government. A political movement – the silverite movement – became a focal point of every major election up until 1900, when gold advocate William McKinley beat out silverite William Jennings Bryan for the presidency.
With all this controversy, the US government quietly refrained from issuing another Currency Act until 1965, when all this had long since blown over.
The Coinage Act of 1965 was deemed necessary because the US dollar had been taking a swift scrotal kick on the international marketplace. There was a coin shortage, mostly because the silver content in the coins was getting to be more valuable than the coins themselves – call it silver’s revenge. This legislation eliminated all silver from dimes and quarters, and demoted the silver content of the half dollar from 90% to 40%. Silver dollars would not be minted for the next five years.
The very definition of the American dollar has changed so much over the years, with its coin content redefined and reworked to the point where there is no actual legal definition of a US dollar anywhere on the books. The dollar is simply the dollar. Indefinable, flexible, and far too infrequently in my possession.
Hopefully, via the magic of the internet and the illusion of the existence of karma, I will have changed that today.