Morgan dollar

The Morgan dollar was a United States dollar coin minted intermittently from 1878 to 1921. It was the first standard silver dollar minted since production of the previous design, the Seated Liberty dollar, ceased due to the passage of the Fourth Coinage Act, an act which also ended the free coining of silver. The coin is named for its designer, United States Mint Assistant Engraver George T. Morgan. The obverse depicts a profile portrait representing Liberty, while the reverse depicts an eagle with wings outstretched.

The dollar was authorized by the Bland–Allison Act. Following the passage of the Fourth Coinage Act, mining interests lobbied to restore the free coinage. Instead, the Bland–Allison Act was passed, which required the Treasury to purchase between two and four million dollars worth of silver at market value to be coined into dollars each month. In 1890, the Bland–Allison Act was repealed by the Sherman Silver Purchase Act, which required the Treasury to purchase 4,500,000 troy ounces (140,000 kg) of silver each month, but only required further silver dollar production for one year. This act, in turn, was repealed in 1893.

In 1898, Congress approved a bill that required all remaining bullion purchased under the Sherman Silver Purchase Act to be coined into silver dollars. When in 1904, those silver reserves were depleted, the Mint ceased to strike the Morgan dollar. The Pittman Act, passed in 1918, authorized the melting and recoining of millions of silver dollars. Pursuant to the act, Morgan dollars resumed mintage for one year in 1921. The design was replaced by the Peace dollar later the same year.

In the early 1960s, a large quantity of uncirculated Morgan dollars was found to be available from Treasury vaults, including issues once thought rare. Individuals began purchasing large quantities of the pieces at face value, and eventually the Treasury ceased to exchange silver certificates for silver coin. Beginning in the 1970s, the Treasury conducted a sale of silver dollars minted at the Carson City Mint through the General Services Administration. In 2006, Morgan's reverse design was used on a silver dollar issued to commemorate the old San Francisco Mint building.

Background

In 1873, Congress enacted the Fourth Coinage Act,^[1] which effectively ended the bimetallic standard in the United States by demonetizing silver bullion.^[2] Prior to enactment of the Coinage Act, silver could be brought to the mints and coined into legal tender for a small fee.^[3] With such a system in place, bullion producers could have silver coined into dollars when the intrinsic value of a silver dollar was lower than the face value, thus making a profit, flooding the money supply and causing inflation.^[4] The act ended production of the standard silver dollar (then the Seated Liberty dollar, as designed by Christian Gobrecht) and provided for mintage of a silver trade dollar, which was intended to compete with Mexican dollars for use in the Orient.^[4] Under the act, bullion producers were allowed to bring bullion to the mints in order to be cast into bars or coined into the newly authorized trade dollars for a small fee.^[4] Trade dollars initially held legal tender status, but it was revoked in 1876 to prevent bullion producers from making a profit by coining silver into trade dollars when the value of the metal was low.^[5] The restrictions on free coinage laid out in the Coinage Act initially met little resistance from mining interests until the price of silver declined rapidly due to increased mining in the Western United States.^[2] Protests also came from bankers, manufacturers and farmers, who felt an increased money supply would have a positive impact. Groups were formed that demanded the free coinage of silver (or "Free Silver") in order to inflate the dollar following the Panic of 1873.^[6]

Beginning in 1876, several bills were introduced in the House of Representatives in an effort to resume the free coinage of silver.^[6] One such bill introduced into the House by Democratic Representative Richard P. Bland of Missouri was passed in the fall of 1876.^[6] Republican senator William B. Allison of Iowa added important amendments to the bill in the Senate. The House bill allowed Free Silver; one of Allison's amendments struck that provision.^[6] This same amendment allowed for the issuance of silver certificates for the first time in United States history.^[6] The bill was vetoed by President Rutherford B. Hayes.^[7] The president's veto was overridden on February 28, 1878.^[7] What came to be known as the Bland–Allison Act required that the Treasury purchase between two and four million dollars worth of silver per month, to be coined into silver dollars at the former gold/silver value ratio of 16:1, meaning that one ounce of gold would be valued the same as sixteen ounces of silver.^[3]

Design history

In 1876, Director of the Mint Henry Richard Linderman began efforts to redesign the nation's silver coins.^[8] Linderman contacted C.W. Fremantle, Deputy Master of the Royal Mint in London, requesting him to "find a first class die-sinker who would be willing to take the position of Assistant Engraver at the Mint at Philadelphia."^[8] In response to Linderman's request, Fremantle wrote "My inquiries as to an Assistant Engraver lead me very strongly to recommend for the post Mr. George Morgan, age 30, who has made himself a considerable name, but for whom there is not much opening at present in this country."^[8] An agreement was reached between Linderman and Morgan for the engraver to work at the Philadelphia Mint under Chief Engraver William Barber on a six-month trial basis.^[8]

Morgan arrived in Philadelphia on October 9, 1876.^[8] His earliest pattern coins designed during his tenure at the Philadelphia Mint were intended for the half dollar.^[9] In 1876, Morgan enrolled as a student at the Pennsylvania Academy of the Fine Arts to prepare to create a new Liberty head design.^[10] Morgan also obtained studies from nature of the bald eagle for preparation of the reverse design.^[10] For the representation of Liberty, Morgan sought to depict an American woman rather than the usual Greek–style figures.^[10] Morgan's friend, artist Thomas Eakins, suggested he use Anna Willess Williams of Philadelphia as a model.^[10] In total, Morgan had five sittings with Williams; he declared her profile to be the most perfect he had seen.^[10]

On October 18, 1877, Linderman requested Superintendent of the Philadelphia Mint James Pollock to "instruct Mr. Morgan to prepare without delay, dies for a silver dollar, the designs, inscriptions, and arrangement thereof to be the same as the enclosed impression for the Half Dollar and numbered '2' substituting the words 'one dollar' in place of 'half dollar'". Linderman also ordered Pollock to "instruct Mr. Barber to prepare a reverse die for a dollar with a representation of an eagle as well as the inscriptions required by law. He will select whichever of his Heads of Liberty he prefers for the obverse of the same."^[11] Linderman evidently preferred the designs of Morgan over those of the Chief Engraver; he wrote Pollock on February 21, 1878, "I have now to state for your information, that it is my intention, in the event of the silver bill now pending in Congress, becoming law, to request the approval by the Secretary of the Treasury, of the dies prepared by Mr. Morgan."^[12]

Production

Production of the coins did not commence until March 11, more than a week after the passage of the Bland–Allison Act.^[13] The first acceptable strike, after adjustments to the press, was coined at 3:17 p.m. at the Philadelphia Mint.^[13] This piece was given to President Hayes; the second and third were given to Secretary of the Treasury John Sherman and to Mint Director Henry Linderman.^[13]

Linderman desired to involve the western mints of San Francisco and Carson City in production in order to help reach the monthly quota necessary under the Bland–Allison Act.^[14] Pressure was so great at the Philadelphia Mint that it halted production of all other coins and began operating overtime.^[15] Use of the western mints was delayed, however, as all dies were prepared at the Philadelphia Mint, and it was believed that the Western mints did not have the proper equipment to prepare the dies for use.^[16] During the second week of production, Linderman pointed out what he called a "slight imperfection" in the dies for the dollar.^[16] The reason for the changes was to reduce the relief of the designs and to change the number of tail feathers on the eagle from eight to seven; this was done because all prior United States coinage depicted the bald eagle as having an odd number of tail feathers.^[16] The high relief had caused the dies to have a shorter life.^[15] Dies were eventually sent to the Western mints, arriving in both San Francisco and Carson City on April 16, 1878.^[17] The New Orleans Mint began striking the new silver dollars in 1879.^[18] Throughout the series numerous small die varieties occurred. These have been cataloged by Leroy Van Allen and George Mallis into VAM Numbers for each year, and examples of each are in demand by advanced collectors.^[19]

The Denver Mint, established in 1906, struck the coins for only one year, in 1921.^[20] The mint marks appearing on the coins are none, representing Philadelphia, "CC" for Carson City, "S" for San Francisco, "O" for New Orleans and "D" for Denver.^[20] In order to conform to the Coinage Act of 1837, the Morgan dollar contained ninety percent silver and ten percent copper, measured 38.1 millimetres (1.50 in) in diameter and weighed 412.5 grains (26.73 g).^[21]

Sherman Silver Purchase Act, Panic of 1893

Mintage of the Morgan dollar remained relatively steady until the passage of the Sherman Silver Purchase Act on July 14, 1890.^[22] The act, authored by Ohio senator and former Treasury secretary John Sherman, forced the Treasury to increase the amount of silver purchased to 4,500,000 troy ounces (140,000 kg) each month.^[23] Supporters of the act believed that an increase in the amount of silver purchased would result in inflation, helping to relieve the nation's farmers.^[24] The act also received support from mining interests because such large purchases would cause the price of silver to rise and increase their profits.^[24] Despite the fact that the purchase of silver was required by the act, it stated that the Mint must coin 2,000,000 silver dollars each month only until 1891.^[25] Since the Treasury already had a surplus of silver dollars, mintages dropped sharply beginning in 1892.^[22] Thus the scarcest coins in the series occur just after this date, with the rarest the 1895 Philadelphia issue, which has only been found as a proof mintage of 880 dollars.^[26] The silver that remained after mintage of the dollars was used to mint dimes, quarters and half dollars.^[22]

Beginning early in 1893, a number of industrial firms, including the Philadelphia and Reading Railroad and the National Cordage Company went bankrupt.^[27] The resulting bank runs and failures became known as the Panic of 1893.^[27] In June of that year, President Grover Cleveland, who believed that the Panic was caused by the inflation generated by the Sherman Silver Purchase Act, called a special session of Congress in order to repeal it.^[25] The act was repealed on November 1, 1893.^[25] On June 13, 1898, Congress ordered the coining of all the remaining bullion purchased under the Sherman Silver Purchase Act into silver dollars.^[25] Silver dollar production rose again,^[20] until the bullion was exhausted in 1904, when it ceased.^[28]

Pittman Act

In 1918, Democratic senator Key Pittman of Nevada introduced legislation that was largely meant as relief for the British government during World War I.^[29] The bill, passed on April 22, 1918, states that "sales of silver bullion under authority of this act may be made for the purpose of conserving the existing stock of gold in the United States, of providing silver for subsidiary coinage and for commercial use, and of assisting foreign governments at war with the enemies of the United States."^[29] The reason for the United Kingdom's need was a propaganda campaign of the German government.^[28] The Germans convinced residents of India that the banknotes issued by the British government could not be redeemed for silver, which caused a run on the British supply of the metal.^[28] The Pittman Act authorized the melting of up to 350,000,000 silver dollars.^[29] The melting of the silver dollars began immediately after the passage of the act.^[29] A total of 270,232,722 silver dollars were eventually melted.^[29] 259,121,554 of the melted dollars were sold to the United Kingdom at the cost of one dollar per troy ounce.^[29] Another provision of the Pittman Act authorized the coinage of a replacement for every silver dollar melted.^[30] Mintage of the Morgan dollar resumed for only one year, 1921.^[30] Since all obsolete coinage dies had been destroyed in 1910, Morgan was forced to create an entirely new master die for the dollar.^[31] 1921 also marked the first issuance of the Peace dollar, as a coin to commemorate the resulting peace after World War I.^[32] This replacement of the Morgan dollar was issued under the terms of the Pittman Act without congressional authorization, despite the fact that the act makes no mention of the design of the coins.^[32] The change in design was actually authorized under an 1890 act of Congress,^[33] which stated:

Treasury release, General Services Administration sales and legacy

Between November 1962 and March 1964, millions of Morgan and Peace dollars were sold to the general public.^[35] Interest began in 1962, when a date of Morgan dollar that was previously considered very rare was discovered in a bag of silver dollars taken from a vault of the Philadelphia Mint.^[35] The demand to exchange silver certificates for silver dollars was so great that lines formed outside of the Treasury Building in Washington, D.C., with some of those in line pushing wheelbarrows.^[35] Upon discovering bags of Carson City-minted dollars, Treasury officials decided to hold them back as mintage totals from that mint were generally lower than others.^[35]

On May 12, 1969, the Joint Commission on Coinage held a meeting in order to determine how best to dispose of the Carson City-minted dollars earlier held back by Treasury officials. They recommended a mail bid sale.^[36] Legislation was passed on December 31, 1970 stating that the approximately three million silver dollars were to be transferred to Administrator of General Services in order for the coins to be marketed.^[37] The legislation also stated that all proceeds from the sale were to be "covered into the Treasury as miscellaneous receipts."^[37] Congress supplied the General Services Administration with ten million dollars to market the dollar coins.^[36] Advertising consisted of posters and brochures distributed to post offices, banks and various financial institutions, as well as television documentaries.^[36] The coins were sorted and put into small plastic display cases.^[36] The Administration conducted a total of seven mail bid sales between 1972 and 1980.^[36] In total, the sales generated $107 million.^[36]

On June 15, 2006, legislation was approved that provided for the minting of a silver dollar and a five dollar gold coin in "commemoration of the Old Mint at San Francisco," with surcharges to be given to the San Francisco Museum and Historical Society in an effort to rehabilitate the Old Mint.^[38] In total, 100,000 gold and 500,000 silver commemorative coins were authorized.^[38] Authorization came at the behest of several hobby publications, who enlisted readers to contact their local congressmen in order to persuade them to pass necessary legislation.^[39] The designs approved for the silver dollar bear a left-frontal view of the Old Mint building and a copy of Morgan's eagle design on the obverse and reverse, respectively.^[40] Mint artist Joseph Menna made a new model for the reverse, employing a 1904 San Francisco-minted dollar as his model.^[41]

References

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