![]() ![]() It is a work of legislation for which we can not now be too thankful. The act of 1873 was a piece of good fortune, which saved our financial credit and protected the honor of the State. Had the demonetization of the silver dollar not been accomplished in 18, we should have found ourselves in 1876 with a single silver standard, and the resumption of specie payments on January 1, 1879, would have been in silver, not in gold and 15 per cent of all our contracts and existing obligations would have been repudiated. We are now, in the course of our story, approaching the year 1876, in which occurred the phenomenal fall in the value of silver. To the year 1873 there had been coined of 412½-grain dollars for purposes of circulation only $1,439,457, and these were coined before 1806.īut while the act of 1873 had little importance in changing existing conditions, it had an influence of a kind which at the present time can scarcely be overestimated. As if a law which made no changes in the actual metallic standard in use, and which had been in use thus for more than twenty years, had produced a financial disaster in seven months! To any one who knows of the influence of credit and speculation, or who has followed the course of our foreign trade since the Civil War, such a theory is too absurd to receive more than passing mention. *88 of the commercial crisis of September, 1873. Important consequences have been attached to it, and it has even been absurdly charged that the law was the cause *87 is known as the act which demonetized the silver dollar. A law which merely recognized existing conditions can not be compared with the law which had for its object to establish those conditions and this states the relative force of the act of 1853 and that of 1873. A vast deal of rhetoric has been wasted on the act of 1873, 3, but its importance is greatly overrated. This, then, was the act which really excluded silver dollars from our currency. In 1853 Congress advisedly continued in motion the machinery which kept the silver dollar out of circulation, and, as we have seen, avowed its intention to create a single gold standard. Silver was not driven out of circulation by the act of 1873, which omitted the dollar of 412½ grains, since it had not been in circulation for more than twenty-five years. Whatever is to be said about the demonetization of silver as a fact must center in the act of 1853. ![]() It did not introduce anything new, or begin a new policy. In discontinuing the coinage of the silver dollar, the act of 1873 thereby simply recognized a fact which had been obvious to everybody since 1849. The act of 1873, however, dropped the dollar piece out of the list of silver coins. In 1853 it had been agreed to accept the situation by which we had come to have gold for large payments, and to relegate silver to a limited service in the subsidiary coins. In 1873 we find a simple legal recognition of that which had been the immediate result of the act of 1853, and which had been an admitted fact in the history of our coinage during the preceding twenty years. The Demonetization of Silver Part I, Chapter VII ![]()
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