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Bulloch History with Roger Allen: Currency evolves with motto; gold, silver standard
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Roger Allen

Note: The following is part of a series of columns looking at how hard currency was introduced in Georgia and Bulloch County.


The new motto for U.S. currency - "In God We Trust" - was first displayed on the 1864 2-cent coin. It was then ordered that all coins bear this motto if it could be added to their designs.

The motto disappeared from the 5-cent coin between 1883 and 1938 and from the 1907 golden double eagle.

In 1908, Congress ordered that all coins once again bear the motto if they had previously.

Silver falls in and out of favor

Silver was first "demonetized" in the Coinage Act of 1853. Senator and soon-to-be Confederate Secretary of State Robert Toombs, of Georgia, was on the Ways and Means Committee at that time.

He wrote, "Men were buying up our half-dollars, quarters, and dimes, throwing them into the melting pot, and exporting them. We had no change in the country."

Whereas the Coinage Act of 1792 had promised a "free coinage of both gold and silver," the new Coinage Act of 1873, if passed, threatened to remove the silver dollar from circulation.

It passed both the House and Senate easily, but many legislators were unaware the silver dollar would be withdrawn. Toombs, upon learning of this, declared the act "a fraud, put through by a venal Congress."

Toombs declared, "The silver dollar has never been legally demonetized, and if it ever has, it was a fraud upon the people, a trick that ought to be punished by a penalty on the tricksters."

Nonetheless, the silver dollar of 412 1/2 grains of standard silver was formally replaced by the gold dollar of 25 8/10 grains of standard gold.

What standard? First it was silver

By 1876, even George M. Weston, the secretary of the U.S. Monetary Commission, called this 1873 act "the crime of 1873." Regardless, America was now on a single "gold standard."

The 1878 Bland Allison Act ordered the Treasury to coin millions of silver dollars. Because of the Sherman Silver Purchase Act of 1890, huge purchases of silver bullion were made to shore up America's Treasury reserves.

Silver prices continued to drop steadily. Worth $1.02 in 1870, 88 cents in 1880, 80 cents in 1890 and
48 cents in 1900, the silver in a silver dollar was worth only 41 cents by 1910.

What standard? Then it was gold

In 1894, the U.S. produced less than 2 million ounces of gold and less than 50 million ounces of silver. Of those amounts, Georgia produced only 4,728 ounces of gold and 325 ounces of silver.

With the passage of the Gold Standard Act of 1900, Congress decided that "the dollar, consisting of
25.8 grains of gold nine-tenths fine ... shall be the standard unit of value."

One of America's literary treasures was actually a very sophisticated commentary on the gold and silver (or bi-metalism) debate. Frank Baum, a political activist, wrote "The Wizard of Oz" about this matter.

Many scholars saw the story's Wicked Witch of the East as being President Grover Cleveland, who had repealed the Sherman Silver Purchase Act.

Roger Allen is a local lover of history. Allen provides a brief look each week at the area's past. Email Roger at rwasr1953@gmail.com.

 

 

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