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generally current in the United States at four shillings and six pence sterling; excepting an allowance which they proposed to make for the waste and expense of coinage of silver. They made a similar allowance of 4 per cent. upon the coinage of gold.
The ordinance assumed, for the standard of purity, both of gold and silver coins, eleven parts fine, and one part alloy. This standard was, with respect to gold, the same as that of England. Bat the English standard of silver coins is eleven ounces and two pennyweights of fine, to eighteen pennyweights of alloy; so that, while the English pound troy weight, of coined silver, contained 5,328 grains of pure metal, that of the United States, by the standard then established, contained only 5,280 grains.
In the elaborate calculations of the report, which were adopted as the basis of the ordinance, no allowance whatever is made for this difference of 48 grains in the pound troy, between the English standard and that prescribed for the United States. It expressly states that the English mint price of standard silver is sixty-two shillings sterling, and professes to prepare a dollar of equal value, excepting an allowance of two per cent. for waste and coinage. It then draws a proportion without reference to the difference between the two standards, and computes the sixty-two shillings of the English standard pound troy, as if they contained only 5,280, while they really contained 5,328 grains. The object of this omission apparently was, together with the two per cent allowance for waste and coinage, to preserve what the report states to have been the proportional value established by custom in the United States, between coined gold and silver of fifteen and six tenths for one, while their proportional value in the English coins was 15.21 for one.
The ordinance for the establishment of the mint, and for regulating the value and alloy of coin, therefore prescribed that bullion, or foreign coin, should be received there as follows: Uncoined gold, or foreign gold coin, eleven parts fine, and one part alloy
i lb. troy weight $209 77 Silver, 11 parts fine and 1 part alloy i lb. . - 13 77 7
And so in proportion to the fine gold and silver in any other foreign coin, or bullion. And the dollar to be issued from the mint of the United States was settled at 375.64 grains of pure silver, because the report of the Board of Treasury had first supposed, contrary tu that fact, that there were only 5,280 grains of pure silver in sixtytwo shillings of English silver coin, consequently, only 383.225 grains, instead of 387, in four shillings and six pence, and then provided an allowance of two per cent. for waste and coinage. By these operations it seems to have been thought that the standard dollar of the United States would be of equal value with the Spanish dollar, then current in this country, and with four shillings and sixpence of English silver coin. Thus, while, by the 18th section of the act of 31st July, 1789, the pound sterling was estimated, for the paymient of duties, at four dollars and forty-four cents, by the 30th section of the same act, every pound sterling paid in guineas, or other gold, was received for 84.57.143, and if paid in English crowns, was received for $4.57.5445.
That the calculations upon wbich the rated value of gold and silver coins was fixed were loose and inaccurate, is apparent. The gold coins of France and Spain were rated as of the same standard of purity with those of England and Portugal; the crown of France as of equal value with the English crown; both without reference to their weight, and both as equivalent to an ounce of silver of the same fineness. It was well known and intended that all these coins should be rated at more than their intrinsic value, compared with the pound sterling, as estimated at 4 dollars 44 cents, or with the standards of gold and silver coins of the United States then established. The differences might be considered in the nature of a discount for prompt payment of the duties. And, as the merchants of the United States were deeply indebted in England, inasmuch as the pound sterling was undervalued, the difference was clear profit to them in discharging the balances due to their English creditors.
The act of 31st July, 1789, was, at the succeeding session of Congress, repealed, and that of 4th August, 1790, substituted in its stead, [2 U. S. Laws, p. 131.] The 40th and 56th sections of this act correspond with the 18th and 30th sections of that of 1789. The pound sterling is again rated at $4.44, and the coins as before.
But on the 2d April, 1792, passed the act establishing a mint and regulating the coins of the United States : by which the whole system established by the ordinance of 1786 was abandoned, and different principles and different standards were assumed. The standard of gold coins was left at 11 parts fine to one of alloy; but instead of 246,268 grains of pure gold, the eagle was required to contain 247 grains. The silver standard was altered from 11 parts in 12 of fine, to 1485 parts in 1664. Instead of 375.64 grains of pure silver, the dollar was required to contain only 371* grains, and its weight, instead of 409 grains, was fixed at 416. The proportional value between gold and silver was fixed by the same law, at fifteen for one; and instead of the allowance of two per cent. for waste and coinage, the principle was adopted of placing gold and silver coined at the same rate as uncoined, and of delivering at the mint coined, the same weight of pure metal as should be brought to it in bullion or foreign coin.
By this operation the value of the silver dollar as compared with British silver coin was reduced from 52.4539 pence sterling to 51.8409 pence; and the pound sterling, from $ 4.57.5445, was raised to be worth $4.62.955; and, at the same time, the value of the dollar estimated in the English gold coin was raised from 52.304 to 52.5656 pence, and the pound sterling was reduced in the gold coin of the United States from $4.57.143 to $ 4.56.572.
The act establishing the mint had, however, no direct reference to the value or the rates of foreign coins. But on the oth February, 1793, passed the act regulating foreign coins, and for other purposes, [2 U. S. Laws, p. 328,) which made the gold coins of Great Britain and Portugal of their then standard a legal tender for the payment of all debts and demands at the rate of 100 cents for every 27 grains of their actual weight. The gold coins of France and Spain at the rate of 100 cents for every 27 grains : Spanish dollars weighing not less than 415 grains at 100 cents : French crowns weighing not less than 459 grains, 110 cents each. The 55th (56th] section of the act of August, 1790, was repealed, but the 40th section was left in force, and the pound sterling was still receivable for $4.44. It was, however, thenceforward, whether paid in the gold coins of England or of the United States, worth $ 4.56.572.
A new collection law was enacted on the 2d March, 1799, which is still in force. In the 61st section of which [3 U. S. Laws, p. 193,] the pound sterling of Great Britain is again rated at 4 dollars 44 cents; while, in the 74th section, the gold coins of Great Britain of the standard prior to 1792, are receivable at the rate of 100 cents for every 27 grains. But a proviso is added to the 61st section, that the President may establish regulations for estimating duties on goods, invoiced in a depreciated currency; and a proviso to the 74th, that no foreign coins but such as are a lawful tender, or made receivable by proclamation of the President, shall be received.
In the act of 9th February, 1793, the English crown was not rated at all, and from that time no English silver coin has been a legal tender, nor consequently receivable in payment of duties.
The act of 10th April, 1806, regulating the currency of foreign coins in the United States, continued the rates established by the 74th section of the act of 2d March, 1799 ; and it required of the Secretary of the Treasury to cause assays to be made every year, and report them to Congress, of the foreign coins made tenders by law, and circulating in the United States.
29th April, 1816, [6 U. S. Laws, p. 117.] Act regulating the currency within the United States of the gold coins of Great Britain, France, Portugal and Spain, the crowns of France, and five franc pieces.
Gold coins of Great Britain and Portugal 27 grs. = 100 cts. or 88 cts. per dwt. France
• 271 = do. 874 Spain
84 Crowns of France, weighing 449 grs. 110 cents, or $1.17 per oz. Five franc pieces
386. grs. 93.3
1.16 do. 3d March, 1819. Act to continue in force the above act.
After 1st November, 1819, foreign gold coins cease to be a tender. Rest of the act to be in force till 29th April, 1821.
The act of 2d April, 1792, establishing the mint, was founded, in its principal features, upon the report of the Secretary of the Treasury, Hamilton. It is remarkable that in this report all notice of the ordinance of Congress of 16th October, 1786, is omitted. .
It says, “ a prerequisite to determining with propriety what ought ľ to be the money unit of the United States, is to endeavor to form
“ as accurate an idea as the nature of the case will admit of, what “ it actually is. The pound, though of various value, is the unit of “ the money of account of all the states. But it is not equally easy “ to pronounce what is to be considered as the unit in the coins. “ There being no formal regulation on the point (the resolutions of Con“ gress of the 6th July, 1785, and 8th August, 1786, having never “ yet been carried into operation) it can only be inferred from usage “ or practice.”
Now the ordinance of 16th October, 1786, was a formal regulation, which recognized the principles, in regard to the unit of coins, of the resolutions of 6th July, 1785, and 8th August, 1786; and the Congress, under the new constitution, had, by the two successive collection laws of 31st July, 1789, and 4th August, 1790, not only rated the foreign moneys of account, but foreign coins, by the standard of dollars and cents, established in the resolution of 8th August, 1786. Millions of dollars had been received in revenue, under those laws, in foreign coins estimated in those dollars and cents. A pamphlet was published by Mr. Boardley at Philadelphia, in 1789: in which he shews that the real value of the dollar, in the first collection law, was 52.46 pence sterling, and not 54, and adds : “I do not consider " whether this valuation accords with a late declaration that twenty “ shillings sterling shall be estimated at the value of 4 dollars and 44 “ cents of the present dollar ; but I recommend it to the considera" tion of others.”
In the Gazette of the United States, of 24th October, 1789, is an essay entitled “ A few thoughts concerning a proper money of ac“ count, by a gentleman of Virginia," in which it is fully shewn that the valuation of the pound sterling, “ as it stands rated by Congress “ at 4 dollars 44 cents," was inconsistent with the pennyweight of gold rated at 89 cents ; that the pound sterling should be rated at 4 dollars 579 cents, or the penny weight of foreign gold coin at 8618 cents, instead of 89, which it states to be greatly to the injury of the revenue.
The alterations from the system established by the old Congress, recommended in Mr. Hamilton's report, and adopted by the law for establishing the mint, were, a dollar of 371. grains pure silver, instead of 375.64 grains; an eagle of 247) grains pure gold, instead of 246.268; 15 for 1 proportional value of silver and gold, instead of 15.6 for 1. Gratuitous coinage, instead of a duty of two per cent. for the bullion sent to the mint to be coined.
Mr. Hamilton proposed to leave the standard of purity of the silver coin at 11 parts in 12 pure, as it had been established by the old Congress. But, in this respect, the law departed from the principles of the Secretary. It took the weight as well as the pure contents of the Spanish dollar, then in circulation, for a model ; not indeed its legal weight and purity, which would have been 420 grains, at 103 parts in 12 pure silver ; but its actual weight and purity, with the allowances for remedy, and ascertained by the average from a considerable number of the Spanish dollars, of the coinage since 1772, which
were then in actual circulation. The result gave us a dollar of 416 grains, and containing 3714 grains of pure silver.
In the coins of the United States there is no allowance for what is called the remedy of weight; but assays of all coins issued from the mint are made, and if any of them are found inferior to the standard prescribed, to the amount of more than iz part, the officers of the mint, by whose fault the deficiency has arisen, are to be dismissed. This provision was adopted from what was stated in Mr. Hamilton's report to be the practice of the mint in England.
By the acts of incorporation of the Banks of the United States. their bills, payable on demand, are made receivable in all payments to the United States, unless otherwise directed by Congress.
By the acts of 31st July, 1789, and 4th August, 1790, the gold coins of Great Britain were rated at 89 cents the pennyweight. By the act of 9th February, 1793, passed after the change of the standard of our domestic coins, British gold coins were rated at 27 grains to the dollar, equivalent to 889 cents the penny weight, at which they stand to this day.
In the year 1797 the British parliament passed an act restricting the Bank of England from paying their own notes in specie, a restriction which has been continued to this day, with certain excéptions, by, recent acts of parliament. The pound sterling, therefore, in all English invoices and accounts, is now neither gold nor silver, but bank paper. This paper has been at times so depreciated that Spanish dollars have been issued by the bank itself, successively, at five shillings and five shillings and sixpence the dollar, and they have passed in common circulation at six shillings.
In the year 1816 there was a coinage of silver at the mint, in which the pound troy weight of standard silver was coined into 66 shillings, instead of 62 shillings, which had been the standard before.
And an act of parliament of 20 July, 1819, confirms the restrictions upon cash payments by the bank, until the first day of May, 1823, with the following exceptions.
1. That, between 1st February and 1st October, 1820, any person tendering to the bank its notes payable on demand, to an amount not less than the price or value of sixty ounces of gold, at the rate of four pounds one shilling per ounce, shall receive payment in gold, of the lawful standard at that rate of £4 1s. per ounce..
2. That, from 1st October, 1820 to 1st May, 1821, such payments shall be made in gold, calculated after the rate of £3 198. od. per ounce.
3. And that, from the 1st of May, 1821, to the 1st of May, 1823, they shall be make in gold, calculated after the rate of 93 178. 104d. per ounce. All these payments to be made, at the option of the bank, in ingots or bars, of the weight of sixty ounces each, and not otherwise.
Throughout this whole canto of mutability, the pound sterling of Great Britain, from the 31st July, 1789, to this day, has been rated by the laws of the United States, at 4 dollars and 44 cents.