The declaration in the Coinage Act of 1873, that the gold dollar was to be thereafter the unit of value, and the omission of the silver dollar from the coins to be struck under the provisions of that Act, placed the United States upon the single gold standard. The silver dollar had already become obsolete in fact; the law of 1873 merely conformed to that fact. This legislation was a continuation and consummation of that which took place in 1834 and 1853, which had for their object the use of gold as the principal money of coin payments in this country

In respect to this last legislation, it may be said that, at the time it took place and for some time previously, the weight of opinion in Europe and America was against the practicability of maintaining a double standard on any basis which might be selected, and in favor of a single gold standard. This important feature of the Coinage Act of 1873 had been agreed upon by Congress, before it became apparent that a serious decline in the value of silver was likely to take place, in consequence of the change from the silver to the gold standard by the German Empire; and this change in reality could have had no influence in determining the question.

After the great decline in the price of silver had commenced, it was claimed that the discontinuance of the silver dollar had been determined upon with

out due consideration, especially in view of the large amount of public and private indebtedness.

Whatever difference of opinion may now exist as to the wisdom of the measure, it may be asserted, without the fear of successful contradiction, that no one who favored this legislation had the least idea of giving creditors any advantage over debtors.

Opinions will of course differ as to the propriety of changing the metallic money standard at a time when the actual circulating medium of the country was an irredeemable paper currency, but it is certain that if the legislation, of which complaint is now made, had not occurred, the interest-bearing obligations of the United States would, in the mean time, have depreciated proportionally with the decline in the value of silver; and all attempts to fund obligations at lower rates of interest would no doubt have failed, as it would have been impossible, during the last four years, to have sold at par in gold, public securities legally payable in silver dollars of 4121 grains, United States standard.

Coinage of Twenty-cent Piece of Silver Authorized.

The Act of March 3, 1875, authorized the coinage and issue of a silver piece of the denomination of twenty cents, weighing five grams of standard silver (7710

16

grains troy) and a legal tender at its nominal value for any amount not exceeding five dollars in any one payment.

This coin is so near the size of the quarter-dollar that they are not readily distinguishable, and consequently only a limited amount has been coined. It is a convenient decimal division of the dollar, and should have been originally authorized in place of the quarter-dollar piece.

CHAPTER X.

THE TRADE DOLLAR.

HE following extract from a Report made by the

THE

author to the Secretary of the Treasury, November 19, 1872, at which time the Coinage Act of 1873 was pending in Congress, shows the grounds on which the coinage of the trade dollar was authorized by that Act.

"Production of Silver, and Market for the Same.

"The amount of silver bullion annually produced from the mines of the United States has been increasing during the last three years, and now amounts to about twenty millions per annum, exclusive of the gold it contains; and a further increase in this product being quite certain, the future value of silver as compared with gold is a matter of national impor

tance.

"The fluctuations in the relative value of gold and

silver during the last hundred years have not been. very great, but several causes are now at work, all tending to an excess of supply over demand for silver, and its consequent depreciation. Among these causes may be stated the increasing production, its demonetization by the German Empire, and continued disuse in this country, except to a limited extent, as a part of the circulating medium.

"It has also been demonetized by Japan, while in some other countries silver coin has been wholly or partially expelled from circulation by paper money, the effect of which will be to bring to market as bullion large amounts hitherto used as coin. The amount of silver coin in the German Empire at the date of the enactment of the recent coinage law, (December, 1871,) which changed the standard from silver to gold, is estimated by competent authority at $350,000,000, being equal to five years' total production of the globe.

"Even if silver should be adopted by Germany, for subsidiary coinage, not more than $50,000,000 will be required for that purpose, which will leave $300,000,000, or about 9,000 tons, to be disposed of as bullion. A market for this immense supply of silver can only be found in such of the European states as maintain the single standard of silver, or the double standard of gold and silver, and in China and the Indies.