 | By October 05, 2011 |
The Civil War ended in April 1865 but the damage done to the monetary system during that conflict had been extensive. The United States in early 1861 had been on a regimen of hard money, where gold and silver were readily found in the marketplace. The steady drumbeat of costly battles, however, meant that a nervous public hoarded gold coins by the end of 1861; the turn of silver came in the summer of the following year.
The meltdown in the monetary system was not quite complete, as the West coast continued to use gold and silver. By July 1862 the situation east of the Rockies, however, was chaotic, with only a limited amount of paper money and the lowly cent in daily use. The government soon authorized the use of stamps as a temporary substitute currency and within a few weeks had begun to print fractional notes with values as low as three cents.
By the middle of 1863 the situation for coins had deteriorated even further. The copper-nickel cents began to be hoarded, much to everyone’s surprise as the intrinsic value was well below the face value. The vacuum was filled in part by millions of private cent pieces, called Civil War Tokens by modern collectors.
With virtually no federal coins used in the marketplace in the latter part of 1863, Mint Director James Pollock suggested the use of bronze for the cent. He later added a bronze two-cent piece to his plan. The Pollock push for bronze minor coins caught the eye of Joseph Wharton, owner of the only nickel mine in the United States and a major supplier of that metal to the Mint.
Through friends in Congress, Wharton managed to delay approval of the necessary legislation proposed by the Mint director until April 1864. Once it was approved, however, Pollock opened the floodgates of coinage and within a few months the nation was well supplied with bronze one-cent and two-cent pieces.
Wharton did not take the defeat lying down and in March 1865 his supporters pushed through Congress a bill authorizing a three-cent piece in copper-nickel. The success of this coin with the public led Wharton to propose a five-cent piece in the same alloy and here again he was successful with a law passed in early 1866. Coinage of the well-known Shield nickel began in June of that year.
Pent-up war-time needs for minor coinage were reasonably well met by the late 1860s and during the 1870s coinage of the base-metal pieces continued at a leisurely pace. Demand for the nickel was so low at times, as in 1877 and 1878, that the only coinage consisted of proofs for collectors.
In 1873 the Mint laws had been updated and the director’s office was now in Washington. Director Pollock stayed on at Philadelphia as superintendent until March 1879 when he was replaced by the former chief coiner, A. Loudon Snowden. The new superintendent was not only an avid numismatist but he also wished to see improved designs on American coins.
One such effort was his desire to standardize the minor coinage by having similar obverse designs for all three denominations (one, three, and five cents) and all from the same copper-nickel alloy. Had it been carried into effect, the result would have been a considerable savings of time and money.
Little could be done by Snowden as long as there was sluggish demand for nickels but during the early part of 1881 all of this was to change. The resumption of three-cent coinage in 1881, coupled with a strong increase the preceding year for cents, allowed Snowden to feel that the time was appropriate for his unified coinage plan. He ordered chief engraver Charles E. Barber to prepare patterns for all three denominations using a head of Liberty and a simple wreath for the reverse.. read more>>
