Mints, Assay Offices, and Coinage.Mr. Stoughton. I call for the regular order of business.
The Speaker [James G. Blaine, years later he claimed he did not know what was in the bill]. The regular order being called for, the House resumes the consideration of the bill (H.R. No. 1427) revising and amending the laws relative to the mints, assay offices, and coinage of the United States. The question is upon ordering the bill to be engrossed and read a third time. Upon this question the gentleman from Massachusetts (Mr. Hooper] is entitled to the floor.
Mr. Hooper, of Massachusetts. The last revision of the laws relating to the Mint was in 1837; the operations of the Mint had always been insignificant up to that time in comparison to the magnitude they have since assumed. The total gold and silver coinage for five years previous to 1834, when the standard of the gold coinage was changed, was only $16,552,784.10, averaging but little more than three millions per annum. The whole quantity of gold produced in the United States in ten years, from 1814 to 1834, was $3,679,000. During the last five years the total amount of bullion passing through the mints and assay offices has been $178,796,817, averaging nearly thirty-six millions annually, besides the unminted bullion exported, which probably exceeded one hundred millions in those five years, increasing the average production of each year to over fifty-six millions; and this estimate is generally considered far below the actual production. The production of gold during the five years has been estimated at thirty to thirty-five millions annually, and of silver fifteen to twenty-five millions, the gold coinage ranging during that period from twenty to twenty-eight millions, and the silver coinage one and a half to two and a half millions.
The gold and silver mines of California, Nevada, and Idaho were unknown until 1835; the Mint at Philadelphia was then the only establishment of the kind in the United States. The vast productions of those newly discovered mines called for the multiplication of branch mints and assay offices, each of which was established at different times and under separate acts or Congress. Thus a mass of legislation has come in, not always consistent, which now requires codification and amendment. It is clear that the bullion interest in this country, with this enormous production of the precious metals, has become sufficiently important to justify the establishment of a distinct bureau of the Government with a competent head in the Department of the Treasury, and sufficiently important to require the revision and amendment of the laws which were passed when the science of metallurgy and coinage was much less perfect than it is now.
The bill under consideration is believed to contain all that is valuable in existing laws, with such new provisions added as appear necessary to those best acquainted with the subject for the efficiency and economy of the public service in the important department in which it relates. The bill was prepared two years ago, and has been submitted to careful and deliberate examination. It has the approval of nearly all the mint experts of the country, and the sanction of the Secretary of the Treasury. Mr. Ernest Seyd, of London, a distinguished writer, who has given great attention to the subject of mints and coinage, after examining the first draft of the bill, furnished many valuable suggestions which have been incorporated in this bill.
While the committee take no credit to themselves for the original preparation of this bill, they have given to it the most careful consideration, and have no hesitation in unanimously recommending its passage as necessary and expedient.
The Mint was originally established in 1792, and located at the seat of the national Government, then at Philadelphia. The Director of the Mint was its chief officer, appointed by and subject only to the President of the United States. When the seat of Government was transferred to Washington, the Mint being then, as now, centrally and advantageously located, was not removed. Its location at Philadelphia was continued from time to time by Congress until 1828, when an act was passed to continue it there until otherwise ordered by Congress.
The first legislation giving the Treasury Department any direct authority in connection with the management of the Mint was in 1835, when branch mints were authorized to be established at New Orleans, Charlotte, North Carolina, and Dahlonega, Georgia, and placed under the general control and management of the Director of the Mint at Philadelphia, subject to the approval of the Secretary of the Treasury. The Director of the Mint at Philadelphia was, by law, required to make his annual report to the President, until 1856, when it was provided that he should thereafter report to the Secretary of the Treasury.
Under existing laws the assay office at New York is more directly under the control of the Secretary of the Treasury, as the authority is conferred on him to determine the number of its officers and their compensation, subject to the approval of the President of the United States; and unlike those at the mints and other assay offices, the commissioned officers at the assay office in New York were not subject to the confirmation of the Senate. By the act of March 3, 1853, the Secretary of the Treasury was vested with authority to regulate all charges except the coinage charge imposed on bullion at the Mint, the branch mints, and the assay offices; but at the mints at Carson City and Denver this authority is vested in the Director of the Mint at Philadelphia.
Other conflicting laws might be referred to; but those cited are sufficient to show that there is a division of authority and responsibility in the management of this important interest impairing the efficiency of the service; and that a revision of the Mint laws has become necessary.
Sections one and two of the pending bill propose to rectify the evils growing out of conflicting laws and divided authority, by establishing the Mint as a bureau of the Treasury Department, in charge of the Director of the Mint; vesting in him, subject to the direction of the Secretary of the Treasury, all necessary authority for the proper management of the different mints and assay offices. It is believed this change will insure more economy and uniformity in conducting the business of these institutions, with the advantage of having an officer at the seat of Government whose business it will be to make himself familiar with all questions pertaining to bullion and coinage, and prepared to furnish prompt information when called for by Congress or the Secretary of the Treasury.
Sections three to eight of this bill define the official organization of each mint, prescribing the duty of each officer, the mode of appointing assistants and others employed, and requiring records to be kept and vouchers to be taken in regard to all monetary and bullion transactions of the Mint. The office of treasurer of the Mint is abolished, the duties heretofore performed by that officer being consolidated with those of the superintendent of the Mint. The existing laws vest in the Director or superintendent the appointment of all persons (except the regular clerks employed in the treasurer's office) and of all workmen in the "deposit melting-room," where the preliminary assays of bullion are made, while the treasurer, who gives heavy bonds, and is responsible for their conduct and for the bullion intrusted to them, has no voice in their selection or appointment. This has been a source of much trouble and complaint. By the proposed consolidation of the two offices of superintendent and treasurer, that source of trouble will be removed without impairing the security of the depositors or of the Government, as the assayer, who is not an accounting officer, is substituted for the treasurer as the necessary check on the superintendent.
The value of deposits is calculated and determined on the assayer's report; it is therefore peculiarly appropriate that he should be the check upon the superintendent. Another advantage of the consolidation of the duties of the treasurer with those of the superintendent is that the Assistant Treasurers of the United States at New York, Philadelphia, and San Francisco, when relieved from their duties as treasurers of the Mint, branch mint, and assay offices located at these points, will be able to give their undivided attention to their duties as Assistant Treasurers of the United States, which is important in view of the very large increase of business in their respective offices, arising from the financial measures of the last ten years, sufficient to employ fully their time and energies. An other reason for this change is that in each of the three cases referred to, the offices of Assistant Treasurer of the United States and of treasurer of the Mint being filled by the same person, an accurate count and examination at either office has been impracticable without closing for a time both offices. In former years the duties devolved upon the superintendent by this bill have been satisfactorily performed by a single officer at the branch mint at Charlotte, North Carolina, and Dahlonega, Georgia, and one officer, the superintendent, now performs them efficiently at the branch mint in Carson City, Nevada.
Under existing laws the appointment of the assistants and the employment of workmen in the departments of the assayer, melter, and refiner, coiner, and engraver, are made by the Director or superintendent of the Mint, and the officer in whose department they are employed is pecuniarily responsible for them, but has legally no voice in their selection. This bill provides that these appointments shall hereafter be made on the nomination of the head of the department in which they are to be employed.
Sections nine, ten, and eleven provide for temporary appointments in case of the absence or sickness of an officer, and is the same as section four of the act of January 18, 1837. The provisions of the act of January, 1837, are reënacted, which require all officers, assistants, and clerks to take the oath of office. These sections also reënact the existing laws requiring bonds and security from the superintendents, the assayers, the melter and refiner, and the coiners, but authorize the Secretary of the Treasury to increase the amount of the bonds of some of these officers beyond $10,000, that sum being the maximum amount of any bond under existing laws.
Section twelve fixes the salaries of the officers of the Mints and assay offices at the same rates as provided under existing laws, the only change being to pay them, and the wages of workmen, monthly instead of quarterly.
Section thirteen defines the standard of fineness for gold and silver coin, making no change in the existing law, except to reduce the quantity of silver permitted to remain in the alloy of the gold coins, not to exceed one tenth of the whole alloy, instead of one half, as now. This reduction to one tenth confirms to the present daily usage of the Mint. Nearly all gold of domestic production contains a pro portion of silver which must be separated before the gold is alloyed for coinage. This operation is termed at the Mint refining or parting. By the nitric acid method gold cannot be economically refined above nine hundred and ninety-three thousandths; but by the sulphuric acid process it can be refined to nine hundred and ninety-six. The depositor of gold bullion for coinage, under the regulations of the Mint, would not be allowed for the silver parted or recovered above nine hundred and ninety. The unparted silver remains in the gold, and constitutes a part of the alloy, enough copper being added to make the alloy one tenth of the whole mass, which insures uniformity in the color of the gold coin. Under existing laws the practice has been not to allow the depositor for any silver above nine hundred and forty-nine, for the reason that such gold bullion was susceptible, under the law, of being converted into coin without further parting, as the silver allowed to remain was one half of the alloy; but under the provisions of this bill the depositor will be allowed for all the silver up to nine hundred and ninety, because the silver allowed to remain as a part of the alloy is reduced to one tenth, and will, therefore, require all gold bullion to be refined to nine hundred and ninety.
Section fourteen declares what the gold coins shall be, and their respective weights, and makes them a legal tender in all payments at their nominal value, when not below the standard weight and limit of tolerance prescribed, and at a valuation proportioned to their actual weight when below the standard weight and tolerance. Thus far the section is a reënactment of existing laws. In addition, it declares the gold dollar of twenty-five and eight tenths grains of standard gold to be the unit of value, gold practically having been in this country for many years the standard or measure of value, as it is legally in Great Britain and most of the European countries. The silver dollar, which by law is now the legally declared unit of value, does not bear a correct relative proportion to the gold dollar. Being worth intrinsically about one dollar and three cents in gold, it cannot circulate concurrently with the gold coins. The law of 1792, now in force, provided for the coinage of "dollars or units, each to be of the value of a Spanish milled dollar, as the same is now current, and to contain three hundred and seventy-one and four sixteenths grains of pure, or four hundred and sixteen grains of standard silver."
The Spanish dollar of full weight then in circulation contained three hundred and seventy-four and seven eighths grains of pure silver, but the variation or error in fixing the weight of the American dollar is said to have arisen from assuming the average instead of the highest weight of any one of the number of pieces assayed for that purpose. As the value of the silver dollar depends on the market price of silver, which varies according to the demand and supply, it is now intrinsically worth, as before stated, about three cents more than the gold dollar. By the act of January 18, 1837, the standard of the silver coins was increased to nine hundred thousandths fine, which reduced the weight of the dollar from four hundred and sixteen to four hundred and twelve and a half grains; the amount of pure silver, however, remained the same, namely, three hundred and seventy-one and one fourth grains. The committee, after careful consideration, concluded that twenty-five and eight tenths grains of standard gold constituting the gold dollar should be declared the money unit or metallic representative of the dollar of account.
This section also provides that the gold coins, if reduced in weight not more than half of one per cent. on the double eagle and eagle, and one per cent. on the other coins, shall be received at the Treasury of the United States at their nominal value, under regulations to be prescribed by the Secretary of the Treasury for the protection of the Government against fraudulent abrasion or other practices. Such coins have always been received at the Government offices, and are therefore current by common consent in all individual payments. It has been deemed expedient, however, to provide a legal limit which shall furnish a rule for the guidance of the Government offices. Provision is also made for recoining any gold coins now in the Treasury which are of less weight than the limit prescribed for their receipt at the Government offices.
Section fifteen authorizes the exchange for silver coins at par of any gold coins now in circulation which are reduced in weight by natural abrasion below the limit prescribed, but prohibits the exchange as to coins which bear evidence of artificial or fraudulent reductions. These provisions are necessary to keep the gold coins, which are the measure of value, in good condition as to their weight, date, legends, and inscriptions; and as the natural wear of coins in a given number of years can be estimated with reasonable accuracy, it will not be difficult for the Secretary of the Treasury to protect the Government against receiving coins which have been fraudulently diminished in weight, by requiring that they shall have been issued for a certain number of years, which is readily ascertained by the date they bear.
The subject of the weight below which coins should cease to be a legal tender was examined and elaborately reported on by a select committee of the Senate in 1830; but no legislation took place, in view probably of a proposed reduction in the standard of the gold coins, which was finally provided for in 1834, and which more than covered any depreciation in the coins then in circulation. Under the limit of reduction in weight provided for in this bill, it is estimated that the eagle and double eagle would continue in circulation as a legal coin for fifty to seventy-five years, and the smaller gold coins, which abrade more rapidly, would circulate for twenty to thirty-five years.
Section sixteen reënacts the provisions of existing laws defining the silver coins and their weights respectively, except in relation to the silver dollar, which is reduced in weight from four hundred and twelve and a half to three hundred and eighty-four grains; thus making it a subsidiary coin in harmony with the silver coins of less denomination, to secure its concurrent circulation with them. The silver dollar of four hundred and twelve and a half grains, by reason of its bullion or intrinsic value being greater than its nominal value, long since ceased to be a coin of circulation, and is melted by manufacturers of silverware. It does not circulate now in commercial transactions with any country, and the convenience of those manufacturers in this respect can better be met by supplying small stamped bars of the same standard, avoiding the useless expense of coining the dollar for that purpose. The coinage of the half dime is discontinued for the reason that its place is supplied by the copper-nickel five-cent piece, of which a large issue has been made, and which, by the provisions of the act authorizing its issue, is redeemable in United States currency.
Section seventeen provides that the alloy of all the minor coins shall be composed of three quarters copper and one quarter nickel. The alloy of the present three and five cent coins is in the same proportions, and this bill authorizes a one-cent coin of the alloy. The weight of the three and five cents is not changed, and the weight of the piece of one cent is to be in proportion to them. There is no good reason for continuing the issue of minor coins of two different alloys, especially as some inconvenience is experienced in working both of them at the same time in the Mint, where gold and silver is constantly being manipulated. The amount of minor or token coins now in circulation is not less than eight million dollars in nominal value, nearly twelve millions having been issued since 1793; and it is believed that the quantity now in circulation will be sufficient for some years to come. Authority is therefore vested in the Secretary of the Treasury to suspend this coinage whenever there is evidence of its being redundant.
Section eighteen provides that no coins other than those prescribed in this act shall hereafter be issued. The effect of it is to discontinue the coinage of the one and two cent bronze coins.
Section nineteen reënacts the provisions of existing laws in relation to the legends, inscriptions, and devices of the coinage, and restores the motto, "E pluribus unum." It also authorizes any one of the prescribed inscriptions in raised letters on the rim of the gold and silver coins, for their better protection against fraudulent reduction of the weight.
Sections twenty, twenty-one, twenty-two, and twenty-three contain substantially the provisions of existing laws, authorizing the deposit of gold and silver in exchange for refined, or for unparted bars, or for bars of standard fineness, and for the deposit of gold bullion for coinage.
It provides that the fitness of the bullion to be received shall be determined by the assayer, and the mode of melting by the melter and refiner; and makes it lawful to refuse any bullion so base as to be unsuitable for coinage. These provisions seem necessary for the protection of the Government, as well as to protect the melter and refiner against the loss and inconvenience of refining bullion containing a large proportion of base metals, which should be treated at metallurgical establishments rather than at the Mint.
Sections twenty-four and twenty-five are reënactments of existing laws for the assay of bullion.
Section twenty-six reduces the charges for coinage to one fifth of one per cent., but reënacts the provisions of existing laws in regard to the other charges. From the best information to be obtained the actual expense of coining gold does not exceed one fifth of one per cent., and the committee, in adopting that rate, were of opinion that it is neither just nor sound policy to impose a charge in excess of the actual expense of coinage. It is claimed, and apparently with good reason, that the present charge of half of one per cent. for coining is so high as to operate as a tax on bullion and encourage its exportation to Great Britain, where it is coined without charge, and where the only loss is that arising from a delay of about two weeks in delivering the coin for the bullion deposited; the British mint holding no bullion fund, as in our Mint, out of which to pay depositors for their bullion as soon as its value is ascertained by assay.
Section twenty-seven requires the assayer to verify all calculations or computations of the value of deposits, and to countersign the certificate for the depositor, which is required to be made by the superintendent. This check on the superintendent is substituted for the calculation of the value of the deposit made at present by a clerk of the treasurer, and it is believed to be a decided improvement of existing laws.
Sections twenty-eight and twenty-nine are substantially reënactments of existing laws in relation to the purchase of silver bullion, but require the purchase to be made by the superintendent instead of the treasurer of the Mint. The existing laws provide that silver coins shall be paid at their nominal value in exchange for gold coin; but it has been the practice to issue the silver coin in exchange for silver bullion, though the nominal value of the silver coin exceeds the intrinsic value of the silver bullion about five cents per ounce. In other words, silver coin of the nominal value of $125 in gold is exchanged for one hundred ounces of silver bullion of the intrinsic value of only $120 in gold. Under this practice the depositors of silver had the benefit of the seigniorage.
Prior to the suspension of specie payments in 1861, silver coins appear to have been issued in excess of the requirements of the public, and were at times sold at a small discount from their nominal value, probably for the reason that they could be obtained at the Mint at less than their nominal value. The principle or system of issuing silver coin at their nominal value, in exchange for gold only, is undoubtedly the correct one, as it gives the Government the benefit of the seigniorage, and restrains their issue to the wants of the public for these subsidiary coins. A proviso, however, has been added to this section, authorizing the present practice to continue in force for two years from the 1st of July next, to meet the special requirement for the subsidiary silver coins in commercial transactions with some of the South American States. This provision, however, applies only to the Mint at Philadelphia and the assay office at New York.---[this makes silver a gold-standard-based coin]
Sections thirty and thirty-one reënact the laws now in force relating to the purchase of metal for the minor coinage after advertising for bids, and requiring the lowest and best bid to be accepted, the fineness of the metal being determined by the Mint assay. It is provided that the gain hereafter arising from this coinage shall be paid into the Treasury of the United States; the expenses for labor in the manufacture of this coin to be paid from specific appropriations made by Congress, instead of being paid as now out of the money received for the coin, without any restriction by law on the expenses.
Sections thirty-two and thirty-three make no change in existing laws regulating the transfer of bullion to the melter and refiner, or the assay of ingots.
Section thirty-four reduces the deviation from standard fineness allowed on gold ingots from two thousandths to one thousandth; and on silver ingots from three thousandths to two thousandths. When the present deviations were originally fixed the art of assaying had not been brought to its present perfection. The present practice of the Mint is not to approve gold ingots that vary more than half of one thousandth, or silver ingots more than one and a half thousandths, from the standard fineness.
Section thirty-five requires the melter and refiner to prepare all bars for the payment of deposits, and to deliver them to the superintendent after their fineness has been ascertained and stamped on the bars by the assayer.
Section thirty-six requires the delivery of ingots to the coiner to be made by the superintendent, instead of the treasurer, the latter officer being discontinued. It provides, also, for vouchers being taken in these deliveries.
Section thirty-seven makes no change of existing laws, except to reduce the deviation in the weight of the half eagle from one half to one quarter of a grain; a tolerance on this piece equal to that on the eagle and double eagle being deemed unnecessarily large. A reduction is also made of the allowance in weighing a number of pieces together in the delivery by the coiner to the superintendent, and by the superintendent to the depositor. The present allowance by law is three pennyweights (equal to $2.79) on one thousand double eagles; two pennyweights (equal to $1.86) on one thousand eagles; one and a half pennyweights (equal to $1.39) on one thousand half eagles; one pennyweight (equal to ninety-three cents) on one thousand quarter eagles; and a half pennyweight (equal to forty-six and a half cents) on one thousand gold dollars.
By this section the allowance or deviation in weighing a number of pieces together is one hundredth of an ounce (equal to eighteen and six tenths cents) on two hundred and fifty double eagles, five hundred eagles, one thousand half eagles, two thousand quarter eagles, or on one thousand three-dollar pieces or one dollar pieces. While a liberal deviation is allowed on the single pieces, it is not intended that the coiner shall take advantage of it, but that he shall make the coins as near to standard as possible; and when so made, a portion of them will be exactly of standard weight; others may be above and some below, but the number of pieces required to be weighed together must give an average not below the prescribed allowance of one hundredth of an ounce, equal to eighteen and six tenths cents. The weighing in quantities is intended to insure the more correct adjustment of single pieces; for example, while the weight of any single half eagle cannot be below a quarter of a grain, (equal to $9.68 in one thousand,) the weight of one thousand half eagles weighed together must not be below eighteen and six tenths cents. The limit fixed in this section is in accordance with the present practice in the operations of the Mint.
Section thirty-eight prescribes the deviation of the weight in the silver coinage. On the dollar and half dollar it is the same as under existing laws, but is increased on the quarter dollar and dime from one grain on the former and a half grain on the latter to one and a half grains for both pieces. This increase is to obviate the expense and delay of a nicer adjustment by hand of each single piece of such value. The section prescribes the deviation when weighed in quantities, as in the case of gold coins, but is more liberal as the metal is of less value.
Section thirty-nine prescribes the deviation in the weight of single pieces of the minor coinage.
Section forty regulates the mode of delivering coin by the coiner to the superintendent, (instead of the Treasurer,) and provides for remelting the coins which prove to be below the legal limits of standard weight.
Section forty-one is a reënactment of existing laws in regard to the "pyx," the superintendent performing the duty heretofore imposed on the Treasurer. It also provides that other pieces than those reserved for the annual trial of the coinage may be taken for such tests as the Director of the Mint shall prescribe.
Sections forty-two, forty-three, forty-four, and forty-five are substantially reënactments of existing laws in regard to the clippings and other portions of bullion remaining after the process of coining; and the annual settlements of the accounts of the coiner and of the melter and refiner for the bullion or metal delivered to them are required to be more thorough in their details than under the present laws. The allowance for wastage of the precious metals is reduced, the improvements in refining and coining having rendered the past allowance for wastage too large, the wastage actually incurred, as shown by the Mint accounts, being considerably within the limits prescribed in this act. The superintendent is required at the close of the annual settlement to forward a correct statement of his balance-sheet to the Director of the Mint, whose duty will be to compare the total amount of gold and silver bullion and coin on hand with the total liabilities of the Mint, and to examine the ordinary expense accounts. These amendments to the existing laws are believed to be important and valuable by securing a more careful scrutiny of all the Mint accounts.
Section forty-six reënacts existing laws requiring deposits of bullion to be paid in the order in which they are brought to the Mint; but provides that when there is a delay in manufacturing a refractory deposit, or for any other unavoidable cause, the payment of subsequent depositors shall not thereby be delayed.
Section forty-seven is a reënactment of existing provisions of law authorizing the exchange at any of the mints of unparted bullion for fine bars, on such terms and conditions as the Director of the Mint may prescribe, with the approval of the Secretary of the Treasury.
Section forty-eight continues the present provision for keeping a fund at the mints and at the assay office in New York, known as a bullion fund, out of which the deposits of bullion may be paid as soon as practicable after the value of the deposits is ascertained.
Section forty-nine contains the present provisions for the assay commission, and the annual trial of the coinage, except that it discontinues the collector of the port of Philadelphia and the United States district attorney for the eastern district of Pennsylvania as ex officio members of the commission, substituting for them the assayer of the assay office at New York, for the purpose of securing the services of a disinterested practical assayer at the trial of the coinage.
Sections fifty and fifty-one are a reënactment of existing laws in relation to the standard troy pound weight of the United States, and the testing annually of its accuracy in the presence of the assay commission; making it also the duty of the Director of the Mint to procure for each mint and assay office a series of standard weights corresponding to the troy pound, and the subdivisions and multiples thereof, from the one hundredth part of a grain to twenty-five pounds; and requiring that the troy weights used at the mints and assay offices shall be regulated according to the above standard at least once in every year, under the inspection of the superintendent and the assayer.
Section fifty-two requires the working dies at each mint to be defaced and destroyed annually, which is now done as a matter of regulation only; but a legal provision for it seems necessary for the protection of the coinage, as in case of all accumulation of old dies they might possibly be stolen from the Mint and used for fraudulent purposes.
Section fifty-three provides that dies of a national character may be executed by the engraver, and national and other medals struck by the coiner at the Mint in Philadelphia, under regulations prescribed by the superintendent, with the approval of the Director of the Mint, but prohibits the preparation of private medal dies or the use of the machinery of the Mint for private dies. It seems just to exclude the preparation of private medal dies at the Mint, so as not to interfere with the legitimate business of private artists.
Section fifty-four requires that all money arising from the deductions and charges on silver bullion, the minor coinage, the manufacture of medals, and all other sources, be paid into the Treasury of the United States, and no part of it expended on salaries or wages, which shall be paid from specific appropriations made by Congress on estimates furnished by the Secretary of the Treasury.
Sections fifty-five, fifty-six, and fifty-seven contain the provisions of existing laws in relation to the assay offices at New York, except that the office of superintendent, assayer, and melter and refiner, who have heretofore been appointed and their salaries fixed by the Secretary of the Treasury, are hereafter to be appointed by the President, by and with the advice and consent of the Senate. Their salaries are not changed, but are established by law. The consolidation of the offices of superintendent and treasurer necessarily abolishes the office of deputy treasurer.
Sections fifty-eight, fifty-nine, sixty, and sixty-one, confine the business of the assay offices at Denver, Boisé City, and all other assay offices that may be hereafter established, to the receipt of gold and silver bullion, and the melting, assaying, and return of said bullion in bars, with the weight and fineness stamped thereon, to the depositor; and provides that the officers shall consist of an assayer, who shall have charge of the office, and a melter, both to be appointed by the President, by and with, the advice and consent of the Senate; and the assayer is authorized to employ as many clerks and workmen, under the direction of the Director of the Mint, as may be provided for by law. A few years since, the office of superintendent at the Denver assay office was abolished, and the duties he had performed devolved on the assayer. The change proved advantageous, and the plan of having but two officers, the assayer and the melter, is adopted in this bill for the assay office at Boisé City, and all other assay offices that may be hereafter established. The salaries provided, the oaths to be taken, and the bonds to be given, are the same as under existing laws. It is also provided that the assayer shall discharge the duties of disbursing agents for the payment of the expenses of the respective assay offices.
All the provisions of this bill for the regulation of the mints, and for the government of the officers and persons employed therein, and for the punishment of all offenses, are made applicable to and declared to be in full force in relation to the assay offices, so far as the same may be applicable thereto. And the general direction of the business of the assay offices is placed under the control of the Director of the Mint, subject to the approval of the Secretary of the Treasury. The Director of the Mint is also required to prescribe such regulations for periodical and occasional returns, and to establish such charges for melting, refining, assaying, and stamping bullion, as shall appear to him necessary for the purpose of carrying into effect the intention of this law with respect to the assay offices.
Sections sixty-two, sixty-three, sixty-four, and sixty-five provide for offenses against the mints, assay offices, and coinage of the United States, prescribing the penalties therefor.
Section sixty-six provides that this law shall take effect at the beginning of the next fiscal year, July 1, 1872; and that the offices of treasurers of the mints in Philadelphia, San Francisco, and New Orleans shall then be vacated, and that the Assistant Treasurer at New York shall cease to perform the duties of treasurer of the assay office in that city. It also provides that the other officers now appointed, and those employed in the mints and assay offices, shall be continued, after giving the bonds required by this law, until other appointments are made; the Director of the Mint at Philadelphia being styled and acting as the superintendent thereof.
Section sixty-seven prescribes the title by which the different mints and assay offices are to be known respectively, and transfers all unexpended appropriations, heretofore authorized by law for the use of those institutions, to the account and use of the mints and assay offices established and located by this act.
Section sixty-nine prescribes the title by which this act shall be known, and repeals all acts and parts of acts pertaining to the mints, assay offices, and coinage of the United States inconsistent with the provisions of this act, with the proviso that their repeal shall not affect any rights accrued or penalties incurred under former acts.
I now yield to my colleague on the committee, the gentleman from Michigan, (Mr. Stoughton.]
Mr. Stoughton. Mr. Speaker, the bill under consideration is intended to be a complete revision of the laws pertaining to the Mint and coinage of the United States. The existing laws upon this subject are embraced in different enactments extending over the whole period of time since the act of April 2, 1792. Some of these are obsolete and others repealed or changed by later laws.
It has been the aim of the committee to arrange, compile, and codify the laws now in force in a systematic form, and to supply such deficiencies as the enlarged wants of the public seemed to indicate. The execution of this plan has been by no means free from difficulty. The conversion of the precious metals into coin with the least expense and the most profit; the best and most serviceable alloys, the proper fineness in order to secure utility and durability at home, and at the same time to conform as nearly as may be with foreign standards, and the wastage and tolerance of the Mint, are subjects which can only be thoroughly understood after long study and actual experience in the practical details.
In the preparation of this bill the committee has been largely aided by the suggestions and experience of those conversant with the coinage and coinage laws, and it is believed that the revision proposed embraces all the provisions necessary for the successful working of this great national interest.
The United States Mint at Philadelphia was established by act of April 2, 1792. By act of March 3, 1835, branch mints were established at New Orleans, and Dahlonega, Georgia, (now discontinued,) and at Charlotte, North Carolina, (now an assay office.) The branch mint at San Francisco was established by act of July 3, 1852; the assay office at New York by act of March 4, 1853; the branch mint at Denver, Colorado, by act of April 21, 1862; the branch mint at Carson City, Nevada, by act of March 3, 1863; and the assay office at Boisé City by act of February 19, 1869. A branch mint was also established by act of July 4, 1864, at Dalles, Oregon, but nothing has ever been done except the useless expenditure of the appropriation of $100,000.
The salaries now paid to the officers of these various mints are as follows:
Director ......... $4,500
Assayer ........... 3,000
Melter and refiner ......... 3,000
Coiner ............ 3,000
Engraver .......... 3,000
Superintendent and treasurer ....... 4,500
Assayer ......................... 3,000
Melter and refiner ......... 3,000
Coiner ............................... 3,000
New York Assay Office
Superintendent ....................... 4,500
Assayer .............................. 3,000
Melter and refiner ................... 3,000
There is also at this office a deputy treasurer, at a salary of $4,500, appointed under the act of March 4, 1853. If he performs any duty, it is that of chief clerk. At San Francisco there is no such officer, although the coinage of that mint is $25,000,000 per year, while at New York it is only about six million dollars in bars.
Superintendent and treasurer .............. $3,000
Assayer ............................. 2,500
Melter and refiner ..................... 2,500
Coiner ............................. 2,500
Superintendent, (not appointed.)
Assayer .................................. 3,000
Melter ....................... 2,500
Assayer's salary and expenses about ............. 5,000
The business transacted at this office is less than $20,000 per year.
Assayer ........................... $3,000
Melter .............................. 2,500
The Mint and coinage laws are largely contained in the various acts of Congress establishing these institutions. Many are local in character and some incongruous and irreconcilable. An instance of this kind is found in the acts approved March 3, 1853, and March 4, 1853, but both passed the same day. The first act gives the Secretary of the Treasury control and jurisdiction over the melting, parting, refining, and assaying of metals, and the second confers the same powers upon the Director of the Mint.
The design of the pending bill is not to interfere with the location or business of the mints in operation, or to change the salaries of the officers, but to provide uniform laws and regulations and place the coinage system under the supervision of a responsible head. The attainment of this end necessarily requires the establishment at Washington of a Mint bureau.
It is in strict conformity with our system of government, and indispensably necessary to its successful and harmonious working, that a chief officer be placed over every important branch of the public service, whose duty it shall be to familiarize himself with all questions relating to his department, see that it is properly conducted, and furnish information to the President, Secretaries, and committees of Congress. The necessity of some measure of this kind to correct irregularities and secure efficiency and economy in the management of our mints and coinage has long been known to those familiar with this subject. Within a few years there have been losses in the mints estimated at $500,000, which, with a proper system of supervision and accountability, such as this bill contemplates, could never have occurred. Under the laws now in force reports cannot be compelled, and the operations of the mints and assay offices are involved in obscurity. What would be the effect upon the public if the business of the national banks were allowed to be managed in this loose and dangerous manner ? The coinage interest is as permanent and important as the currency, and the reasons in favor of the establishment of the Currency Bureau apply with equal force to the Mint.
The consolidation of the offices of Superintendent and treasurer is a measure of sound economy. The assayer determines the weight and value of metals with depositors, and is required to sign the certificates. His own interest and safety is therefore a sufficient check upon the Superintendent. There is also a grave objection to one person holding both the offices of treasurer of the Mint and United States Assistant Treasurer, as now provided by law. They are not necessarily connected, but when held by the same person, and the funds mingled together, no settlement can be made without at the same time closing the business of both offices and taking an account of each. This involves the expense of precipitating the bullion in solution and taking a general inventory of the Mint.
These are the only changes proposed in the organization of our coinage system. Other improvements are provided for in the operation of the Mint and manipulation of the metals. The duties of the officers are more clearly defined, the wants of the public more fully met, and existing laws modified in accordance with modern improvements in metallurgical science. These changes relate principally to alloys, coins, wastage, tolerance of the Mint, and abrasion or the natural wear of the lawful coinage.
The bill reported by the committee provides that the standards of gold and silver shall be such that of one thousand parts by weight nine hundred shall be pure metal and one hundred alloy; the alloy of the silver coins to be of copper, and the alloy of the gold coins to be of copper or copper and silver, but that the silver shall in no case exceed one tenth of the whole alloy. This is the law now, except as to the alloy of gold, which is allowed to be fifty parts of silver and fifty parts of copper. The improvements in separating metals have, however, rendered it easy and practicable to take the silver from gold up to and even higher than nine hundred and ninety parts in every thousand, and the amendment proposed will have the effect of saving the forty parts of silver which are now lost, and at the same time making the gold coins of uniform color and hardness. In Spain, France, Italy, Belgium, and most of the German States, the standard of fineness is the same as ours, or nine tenths pure metal and one tenth alloy. In England it is eleven twelfths pure metal and one twelfth alloy. The difference may be expressed thus: United States, pure metal, 900 thousandths; England, pure metal, 916 thousandths. The advantage of the decimal ratio is obvious.
The gold coins provided for are as follows:
Double eagle, ($20) .................... 516
Eagle ($10) ......................... 258
Half eagle, ($5) ............. 129
Quarter eagle, ($2.50) ..................... 64.5
Three-dollar Piece, ($3) .................... 77.4
One dollar, ($1) the unit of value ............ 25.8
Which are declared to be a legal tender for all sums at their denominational value. Aside from the three dollar gold piece, which is a deviation from our metrical ratio, and therefore objectionable, the only change specifying the present law is in more clearly specifying the gold dollar as the unit of value. This was probably the intention, and perhaps the effect of the act of March 3, 1849, but it ought not to be left to inference or implication. The value of silver depends, in a great measure, upon the fluctuations of the market, and the supply and demand. Gold is practically the standard of value among all civilized nations, and the time has come in this country when the gold dollar should be distinctly declared to be the coin representative of the money unit. In 1816 an act of the English Parliament established gold as the sole standard of value in the United Kingdom. The following extract from the elaborate report of the deputy master of the British mint for 1870, shows the views there entertained upon this important question:
"In 1816 a committee of the privy council made a report on the coinage, which recommended the important and beneficial regulations which to this day govern the currency of the United Kingdom. It recommended that, while no change should be made in the standard of either the gold or silver coins, the former should be constituted the sole standard of value, and the latter converted into a token coinage, which, while passing at its nominal instead of its real value, should form a subsidiary currency for domestic use, without the liability, which had been attended with such disastrous results, of being exported from the kingdom whenever the high price of silver rendered such an operation profitable. With this view the committee proposed that no change should be made in the weight of the gold coins as set forth in the then existing mint indenture, but that the number of shillings coined from the pound troy should be increased from sixty-two to sixty-six.
"In this report may be traced the recommendations made by Charles, Earl of Liverpool, in a letter to the king, dated the 7th of May, 1805, in which the advantages of a single measure of value, and of gold as that measure, are set forth with a force and clearness beyond all praise. This letter, which has ever since its publication remained a text-book of the subject to which it relates, contains a history of the coinage of England from its earliest date till the commencement of the present century, and, white calling attention to the very defective state of the silver currency, which had at that time been reduced by wear to the condition of mere counters, without design or mark of any kind to distinguish them as the coins of the realm, points out that gold had during the last hundred years been in effect the sole standard of value, and that the true interest of the country imperatively demanded that it should be legally made so for the future. Lord Liverpool sums up his proposals by the statement 'that it is evident that where the function of the gold coins as a measure of property ceases, there that of the silver coin should begin, and that where the function of the silver coins in this respect ceases, there that of copper should begin.' In consequence of the report 'made by the committee, an act of Parliament was passed in 1806, 56 George III, chapter 68, substantially carrying their recommendations into effect.'"
The silver coins provided for are the dollar, 384 grains troy, the half dollar, quarter dollar, and dime of the value and weight of one half, one quarter, and one tenth of the dollar respectively; and they are made a legal tender for all sums not exceeding five dollars at any one payment. The silver dollar, as now issued, is worth for bullion 3¼ cents more than the gold dollar, and 7¼ cents more than two half dollars. Having a greater intrinsic than nominal value, it is certain to be withdrawn from circulation whenever we return to specie payment; and to be used only for manufacture and exportation as bullion.
The history of the American silver dollar is somewhat remarkable. The following article from the New American Cyclopedia furnishes an explanation of the confusion it has caused in our metal currency and foreign exchange:
"The dollar unit, as money of account, was established by act of Congress April 2, 1792, and the same act provides for the coinage of a silver dollar 'of the value of a Spanish milled or pillar dollar, as the same is now current.' The silver dollar was first coined in 1794, weighing 416 grains, of which 371¼ grains were pure silver, the fineness being 892.4 thousandths. The act of January 18, 1837, reduces the standard weight to 412½ grains, but increases the fineness to 900 thousandths, the quantity of pure silver remaining 371¼ grains as before, and at these rates it is still coined in limited amount.
"The act of March 3, 1819, directs the coinage of gold dollars. They were issued the same year weighing 25.8 grains, .9 fine, 23.22 grains being pure gold. By the act of April 2, 1792, 371¼ grains of pure silver and 24¾ grains of pure gold were declared to be equivalent one with the other, and to the dollar of account. At that time, as now, in Great Britain, 113 grains of pure gold were very nearly the equivalent of the pound sterling. The value of £1 in Federal money, therefore, was $4.565. Prior to this date, and during the Confederation, the dollar of account, as compared with sterling currency, had been rated 4s. 6d, and in precise accordance with this valuation the Congress of the Confederation had established $4.444 as the custom-house value of the pound sterling. The effect of the act of 1792 was really to reduce the value of our dollar of account, but apparently to increase the value of the pound sterling about 2¾ per cent. By the act of June 28, 1834, the weight of fine gold to the dollar was reduced from 24.75 to 23.20 grains; and three years later, January 18, 1837, it was fixed at 23.22 grains, where it now remains. Comparing this latter weight with the pound sterling of 113 grains, we find an apparent increase of the value of £1 to $4.8665, an advance of almost exactly 9½ per cent. upon the old valuation of $4.444. We have here the explanation of the existing practice in this country of quoting sterling exchange at 9½ per cent. premium when it is really at par."
Much of this difficulty has arisen from the impracticable attempt to make the silver coins conform absolutely and intrinsically to the gold standard. The office of the silver or "subsidiary" coins is to supply the public want for small change. They are made the tokens of value, not the value itself, and are designed only for exchange and circulation at home, up to but never in excess of the requirements of trade. In Europe they range from five to ten per cent. below the gold standard of value, thus paying a seigniorage to the Government and preventing their exportation. Under our laws the difference between the nominal and real value of silver coins, excepting the silver dollar, is about four per cent.
The following statement is taken from the pamphlet of Dr. Linderman, on the "Free Coinage of Gold:"
"The seigniorage on silver varies in different countries, and it also with the price of silver bullion. In the United States it is four per cent.; in Great Britain about ten per cent.; in France, Belgium, Italy, and Spain, about seven and a half per cent.; in Sweden, over twelve per cent.
"The coinage bill recently brought forward by the German empire adopts gold as the sole standard value, and demonetizes silver as to coinage; but the particulars are not at hand to show the extent of the seigniorage on silver.
"If the United States were to exact the same rate of seigniorage as Great Britain, silver coin and United States notes would circulate concurrently at the present premium on gold as compared with paper money."
The seigniorage on copper-nickel coins should, of course, be still larger, and, in the opinion of many eminent economists, not less than fifty per cent.
The bill provides for the purchase of silver bullion at market rate, and the issue of silver coins in exchange for gold at par. This arrangement will give the Government the benefit of the coinage and prevent any redundancy.
The copper-nickel coinage is confined to five-cent, three-cent, and one-cent pieces of convenient size and form, which, it is to be hoped, will take the place of some of the worthless small coins now in use.
The coinage of a country is an unerring index of its civilization; and so long as coins are extant to bear witness to the barbarity or refinement, rudeness or taste, clumsiness or elegance, of those who formed and used them, we have an unmistakable criterion of their attainment in art and science.
How early coins were used history does not inform us. At a very remote period the precious metals were doubtless used as a medium of exchange in the form of ingots, wedges, or bars. Nearly two thousand years before Christ Abraham weighed out in the purchase of the cave of Machpelah "four hundred shekels of silver current money with the merchant."
Herodotus ascribes the invention of striking or coining money to the Libyans, but the earliest coins now extant are of Grecian origin. About four centuries before the Christian era coins of recognized values were in general use among all nations that had arrived at any considerable degree of civilization. The Greek coins, in particular, are cited as an example of artistic excellence. The Milan coinage of the fourteenth century, and the English coinage from 1649 to 1662, were also remarkable for beauty of design and execution.
In monarchical countries the obverse of the coin usually bears the likeness of the reigning sovereign, and the reverse the denomination or value. This, however, was not always the case. The following quaint rhyme, taken by Stowe from a manuscript in the time of Edward I---
"On the king's side was his head and his name written,
On the cross side the city where it was smitten"
shows that local pride and interest have existed in other cities besides Philadelphia, New York, and San Francisco.
In republics a device emblematical of liberty, as a female figure or head, with the peleus or Roman liberty-cap, is generally substituted on the obverse of the coin.
The time-honored devices and legends of our coins are retained, and in elegance and simplicity of design, in the bold relief of the figures, and in the pleasant impression conveyed to the sense of touch and sight, it is believed that the gold and silver coinage of the United States will compare favorably with that of any nation in ancient or modern times.
In the operations of the melter and refiner and coiner some waste or loss necessarily takes place. The act of January 18, 1837, allowed to the melter and refiner two thousandths of the whole amount of the gold and silver bullion, and to the chief coiner two thousandths of the silver and one and a half thousandth of the gold. Improvements in machinery and a higher degree of skill have materially lessened this wastage, and in the bill of the committee it is reduced one half, and within what is deemed a just and reasonable limit.
The tolerance or "remedy" of the Mint is of two kinds: on the fineness of the metal and on the weight of the coin.
The legal standard of gold and silver is nine hundred parts of pure metal and one hundred of alloy. But it is beyond the reach of art or skill to get this admixture absolutely exact. The closest approximations that can be made will sometimes show a variation of a single part or the fraction of a part. The present tolerance of fineness is two thousandths in gold and three thousandths in silver. After careful consideration it has been thought best to reduce this to one thousandth in gold and two thousandths in silver.
It is also necessary that a tolerance or "remedy" should be allowed in the prescribed weight of coins so that reasonable deviations from mathematical accuracy shall not be held to affect the weight at which they may be legally issued. Deviations in the weight of coins exist which the best balances fail to indicate. In such cases, and in all cases where the coin is as near standard above or below as it can practically be made, it is allowed to pass. But, in order to prevent the general issue of light coins within the limit of tolerance, the allowance upon a mass of coins should by no means be in proportion to their number. If there is an honest effort to obtain the standard weight, the deviation is as likely to be above as below that standard. Under the present law the allowance on $20,000 in double eagles is $2.72. This is believed to be too large a margin, and in the bill under consideration it is so reduced that this allowance will be seventy-two cents. The tolerance on the double eagle and eagle is fixed at one half of a grain, and on all other gold coin at one quarter of a grain.
The abrasion or natural wear of coins is a matter of great importance to the Government and the public. The Constitution of the United States provides that "Congress shall have power to coin money, regulate the value thereof, and of foreign coins; and fix the standard of weights and measures." And that "No State shall coin money or make anything but gold and silver a legal tender in payment of debts." The General Government is entitled to all the advantages of this unlimited grant of power, and incurs the correlative obligation of furnishing the public with a convenient and reliable metal currency.
The coins issued by the national mints, when not unreasonably worn or defaced by artificial means, bear the stamp and guarantee of the Government that they are worth the sums they represent. They are issued for circulation, and are unhesitatingly received at their face for equivalent values. In a few years, however, a considerable percentage of any coin in active circulation is sure to be worn away. Where should the loss fall; upon the Government that has placed the coin in circulation and has a remedy in the complete control of the coinage system, or upon the individual who has received it in good faith and has no remedy whatever ?
As early as the reign of Edward IV it was ordered in England that "the lackage in weight should be no cause for refusing gold coins," and in the reign of Henry VI it is recorded that Bartholomew Goldbeater, master of the mint, petitioned the king to take into consideration the "great and unsupportable loss which he had sustained in the waste and loss of weight in the melting of gold and silver." It appears from the history of the British coinage that the natural wear of coins has always been borne by the Crown. In 1816 the old silver coins were authorized to be exchanged at the mint for the new coinage, piece for piece, and under the regulations of the mint of July 28, 1870, gold coins reduced in weight by wear are now recoined at the royal mint and returned to the importer at the full mint rate of £3. 17s. 10½d. per ounce, without any charge or deduction.
The act of Congress of June 28, 1834, provides that---
"Gold coins shall be received in all payments when of full weight according to their respective values, and when of less than their full weight at less value proportioned to their respective weights."
If the weight is to be the only criterion of value, what is the use of having any coinage at all ? The pending bill, although not fully meeting my views upon this point, is a great improvement on existing laws. It provides that gold coins reduced by wear not to exceed one half per cent. on double eagles and eagles and one per cent. on all other coins may be redeemed at the United States Treasury for recoinage under such regulations as the Secretary may prescribe for the protection of the Government against fraudulent abrasion and other practices.
The fifteenth section also provides for the exchange at the mints at Philadelphia and San Francisco of light gold coins which have not been tampered with for new silver coins of the same nominal value.
The effect of these provisions will be to keep coins of full weight in circulation and protect the public from loss and imposition. The Government will realize a profit of from two to three per cent. on the silver exchanged for gold coins; and this will doubtless counterbalance the loss on the gold received through the United States Treasury for recoinage.
There is one other feature of this bill to which the attention of the House ought perhaps to be called. I refer to the provision contained in the forty seventh section authorizing the mints to exchange under proper restrictions unparted for parted or refined bullion.
All bullion received at the Mint is first carefully melted, and the fluid metal stirred until it is homogeneous preparatory to the assay. Gold in its natural state has always more or less silver combined with it, which must be separated before it is fit for coinage. This operation is called "parting," or "refining."
In order to properly effect the separation of gold and silver, several processes have been employed. The operation which has been longest in use in the United States Mint is known as the "nitric acid process," and is based upon the fact that silver is soluble in nitric acid, while gold is not. This process is governed by well known laws of chemical affinity; has no deleterious influences, and yields gold ranging in fineness from nine hundred and ninety thousandths to nine hundred and ninety-three thousandths pure metal, the balance being silver not parted, which constitutes a part of the legal alloy.
Another process which has been extensively used during the last few years is known as the "sulphuric acid process." It has the advantage of being much cheaper than the nitric acid process, and of refining gold to a very high degree, and the disadvantage of requiring expensive buildings and machinery, and engendering fumes of the most deleterious and dangerous character. A third process of parting or refining by the use of chlorine gas has lately been invented, but has not yet been adopted in this country. For parting silver from gold of a high grade and toughening brittle gold it has probably some decided advantages, but these are yet to be tested.
The sulphuric acid process is used at the New York assay office and by private establishments in San Francisco. It cannot be employed at the mints at Philadelphia, San Francisco, and Carson for want of room; besides there are objections to its use in any building intended for coinage operations on account of its offensive fumes.
The true policy of the Government is doubtless to encourage the parting and refining of metals by private industry and capital to the fullest extent. The authority to "coin money" does not necessarily include refining any more than it includes the original production of the precious metals.
As early as 1853 Congress passed an act to encourage refining by private enterprise and gradually exclude it from the Mint. And in 1860 the provisions of this bill were extended to the branch mints and assay offices. The act of July 15, 1870, authorized the exchange at the mints of unparted for parted or refined bullion. The object of this act was to preserve to depositors the security of the Mint, assay and accountability, and at the same time have the refining done by the sulphuric acid process at the extensive and well-managed establishments of the Pacific coast. The immediate results were the saving to the Government of three cents on every ounce of bullion refined, and the protection of the Government against the large losses of former years, amounting to over a quarter of a million of dollars in the bullion fund, and which can only be accounted for upon the hypothesis (as claimed) that it "went up the chimney."
Private enterprise and ingenuity can refine bullion, cheaper and better than the Government ever has done, or probably ever will do. As a matter of political economy this industry should therefore be fostered and encouraged; and as a matter of justice the committee believe that the Government, after having invited the investment of private capital in the business of refining, ought not to destroy that interest by useless and extravagant appropriations.
The importance and necessity of private refining establishments will be better understood when we remember that in the United States the annual production of the precious metals is estimated at, silver, seven hundred and fifty tons; gold, fifty tons, equal to $25,000,000 in silver and $35,000,000 in gold.
In conclusion, Mr. Speaker, I beg leave to say that the rapid reduction of our national debt and the increased confidence in our public securities clearly indicate that the time is approaching when the honest ring of solid coin will again be heard in the busy marts of trade and commerce, and that it is the imperative duty of Congress to shape our coinage system to the growing wants of the immediate future.
Mr. Hooper, of Massachusetts. I now yield ten minutes to the gentleman from New York, [Mr. Potter.]
Mr. Potter [Clarkson Nott Potter (1825-1882) studied law, admitted to the bar]. Mr. Speaker, this is a bill of importance. When it was before the House in the earlier part of this session I took some objections to it, which I am inclined now to think, in view of all the circumstances, were not entirely well founded. But, after further reflection, I am still convinced that it is a measure which it is hardly worth while for us to adopt at this time.
It is now more than thirty years since there has been any general revision of the Mint laws. The coinage of money during all that period has proceeded from year to year, with such occasional legislation as changing circumstances required, without there ever having been any demand for a general revision of these laws. Now, when we have suspended specie payments for ten years, and practically have had no coinage circulation during that time, a bill is introduced here for the purpose of' revising all the laws in respect to coinage, and not only introduced here after the country has suspended using or dealing in coin to any considerable degree, but introduced at a period when there is no prospect that it will at any near period resume coinage circulation.
I confess, therefore, that the introduction of the bill at such a period excited my suspicion. I was and am at a loss to gather from anything I know or can learn that there is any necessity for the adoption of this measure now. When the bill comes to be read section by section, I shall make such suggestions in the way of amendment as I think are calculated to make it better if it should go into operation. But for the present I desire to avail myself of the few minutes allowed me to state generally my objections to the adoption of ally such law now.
In the first place, it is proposed by this bill to change the whole system of officers of the Mint. The bill provides for a Director of the Mint. Now, while I do not know a great deal about these matters, I have not been able to resist the conviction that the bill is designed to make a place for a particular person. I find that the Director of the Mint at Philadelphia, whose report to the Secretary of the Treasury I have before me, condemns the proposed change as unwise and unnecessary, and other experts with whom I have personally consulted have agreed with him in that regard.
Then, in the next place, this bill provides for the making of changes in the legal-tender coin of the country, and for substituting as legal-tender coin of only one metal instead as heretofore of two. I think myself this would be a wise provision, and that legal-tender coins, except subsidiary coin, should be of gold alone; but why should we legislate on this now when we are not using either of those metals as a circulating medium ? The bill provides also for a change in respect of the weight and value of the silver dollar, which I think is a subject which, when we come to require legislation about it at all, will demand at our hands very serious consideration, and which, as we are not using such coins for circulation now, seems at this time to be an unnecessary subject about which to legislate.---[He noticed that the bill proposes to demonetize silver and make it a subsidiary, gold standard based coin; years later, when silver was sort of remonetized, silver coins had to be redeemable in gold. But he doesn't mind that, in fact he is for it; his objection is that some nickel mine owner in Kelley's neighbourhood might receive the benefit of increased demand for his ore.
But beyond that, the bill provides for an entirely new subsidiary coinage. It provides for the coinage of new five-cent, three-cent, two-cent, and one-cent pieces, and it provides that these new coin shall be of a certain alloy of copper and nickel. Now, we have at present in circulation several hundred million pieces of subsidiary base coin. They are familiar to every one of us, and have been in circulation for some years. There is the ordinary nickel five-cent piece, the ordinary nickel three-cent piece, and the bronze two-cent piece, and the nickel one-cent piece; for which there has been substituted of late years the bronze one-cent piece. Of these pieces of subsidiary coinage, I repeat, several hundred million pieces are in circulation; and it is proposed that in place of these pieces we shall have another set of minor subsidiary coins of nickel copper, according to the form prescribed in this bill. For what reason ? It has been suggested for the purpose of uniformity. That reason, however, seems to me so insufficient that it has occurred to me that behind this provision of the law lies the real motive power of this bill; that is, that it will make necessary a great consumption of nickel-copper for several hundred million pieces of this new subsidiary coinage.
Now, it is to be borne in mind that it costs as much to coin these subsidiary copper-nickel coins as to coin a like number of silver or gold coins of like dimensions, and that the recoinage will not be attended with any such advantage to the people as should preclude any one of us from looking upon this provision as a movement in behalf of the private interests controlling nickel. This will be more apparent to the House when I have the Clerk to read the remarks of the Director of the United States Mint at Philadelphia, in reply to the Secretary of the Treasury as to the provisions in this portion of the bill.
The Clerk read as follows:
"These sections embody the provisions of the copper-nickel bill, providing for a new one, three, and five cent coin, presented to and not passed by the last Congress. There exists no necessity, no consideration of public interest or convenience for a change in the present bronze, copper, and nickel coinage, and the substitution of that proposed in these sections. In appearance, in size, weight, and artistic device, the present is fully equal to the proposed base coinage; and as regards the bronze cent in comparison with the nickel cent suggested, it is superior in every pretension; economy, convenience, easy recognition, &c. The copper-nickel cent would be a small, inconvenient coin, so small as to be almost useless; and the cost of the production, after a careful calculation by some of the most experienced officers of the Mint, would be equal to its nominal value in gold.
"It costs as much (material excepted) to make a copper-nickel cent as a gold double eagle.
"If every consideration of economy and a desire to prevent useless waste of the public money condemns the authorizing of the coinage of a nickel-copper one-cent piece, why introduce a three and five cent piece of the same metals and proportions, when the existing coins of the same denominations are equal, if not superior, to the proposed ?
"Then, again, the proposition to abolish the silver five-cent piece in aid of the nickel coin is one that would be by common consent condemned, particularly in a country like ours, abounding in silver ores, and near the day of the resumption of specie payments. We cannot advise this change."
Mr. Potter. That is the letter of the Director of the Mint of the United States at Philadelphia to the Secretary of the Treasury in respect to the provisions of the bill of the last Congress, which in these respects corresponds with the pending bill.
I know it will be said there is to be no forced substitution of the new coin for the old, but only that so far as new coin shall be required it shall be issued under the provisions of this bill. But it should be remembered that this subsidiary coin is base coin, and is of no intrinsic value whatever. Its value consists in the provision of law for the redemption of subsidiary coins by the paper currency of the Government. Now, I apprehend that it will be in the power of the officers of the Treasury Department to so manage the redemption of the present base coin as to make it less available than the proposed copper-nickel subsidiary coinage, and thus induce their exchange, and in effect force the new coinage directed by this bill into circulation instead; until all the present base coin is changed for the new subsidiary copper-nickel coin provided for in this bill.
Generally, in looking over this bill, I am disposed to agree with the Director of the Mint of the United States at Philadelphia when he says "the proposed bill so far as it is a copy of the existing laws is to be approved, but the alterations suggested with very few exceptions are changes without any improvement, nor do they provide any remedy for supposed defects beyond what now exists." When, sir, the House comes to look through the bill and see what it is, it will find, I think, that it is a measure providing for the recoinage of several hundred millions of pieces of subsidiary nickel coin to take the place of the existing five-cent piece, the existing three-cent piece, and the existing two and one cent pieces to no public advantage and to the gain of the nickel owners, but at a great expense to the people. There is also a section of the bill to which, when we come to it, I shall particularly call the attention of the House, by which the purchase of nickel is left in the hands of the officers created by this measure, with a discretion which should not be permitted and which I think may be in the last degree dangerous.
There are also other provisions in the bill which seem to me to militate against its being adopted at all at this time. For instance, the provision in regard to refining, which I think was intended to protect a system of private refining which now exists at San Francisco, in regard to which, I presume, I differ from my friend on my left, [Mr. Sargent,] in thinking, as I do, that it is very disadvantageous to the Government. One intention of the bill, I believe, was to protect that system, as I shall seek to show when the occasion comes.
The time allowed to me being, however, about exhausted, I will only repeat, sir, that I think no sufficient reason has been suggested for generally revising the Mint and coinage laws at this time, and this consideration, together with the particular objections I have alluded to, are, it seems to me, sufficient reasons why this bill should not be adopted now.
Mr. Hooper, of Massachusetts. I yield now to the gentleman from Pennsylvania, [Mr. Kelley]
Mr. Kelley. Mr. Speaker, in the course of my congressional career, now becoming somewhat extended, I have had frequent occasion to notice that any legislation, however general in its character, which assails existing abuses, and would abolish opportunities for illegitimate profits to speculators, is met with zealous and seemingly organized opposition; and that gentlemen on this floor, who are far above suspicion, are plied with arguments so ingenious that, without being aware of it, they become the defenders of private jobs, and venerated, because they are profitable, abuses.
It was apparent to me when I had the honor of bringing this bill to the attention of the House the other day that those who have an interest in securing its defeat, which now amounts to at least from a quarter to a half million dollars a year, and which would, if we were on the basis of specie payments, have an interest running up into many millions, had ingeniously plied some of the leading members of the House with suggestions touching the minor details of the bill, which, if accepted by the House, might render its passage impossible. I therefore asked its recommitment to the committee. I grieve to say that by reason of my connection with the Committee of Ways and Means I have since then been unable to participate in the deliberations of the Committee on Coinage, Weights, and Measures. The bill, as it comes amended before the House to day, is therefore the work of other hands than mine, as indeed was the bill which I presented and attempted to have considered and adopted. It is a bill prepared at the suggestion and under the supervision of the Treasury Department, and now comes to us revised with much care by the Committee on Coinage, Weights, and Measures, exclusive of the chairman, his absence being accounted for by the reasons I have given.
Let me, Mr. Speaker, hastily point out some of the interests that are on this floor seeking to protect themselves by preventing the passage of this bill. One silver bullion dealer of New York during the last Congress admitted to the gentleman who is now acting as chairman of the committee in charge of the bill [Hooper] that under one defect in existing laws he was making, at the cost of the Government, from seventy five thousand to one hundred thousand dollars a year. Is it any wonder that a man who has such large profits dependent upon the continuance of the existing system should be able to furnish gentlemen with ingenious arguments about subsidiary coinage, and in proof of the lack of necessity to take in the fourteen varieties of minor coins, and to substitute but three for the fourteen ? His profits --and he is but one of those who are growing fat and greedy upon the defects in our Mint laws-- arise in this way: our country, like every other civilized Government, should procure its own metal out of which to make subsidiary coinage. Now, sir, every coin of ours that is not gold is subsidiary. Our silver dollar, half dollar, and every other coin that is not gold is subsidiary. As gentlemen seem to express surprise at this proposition, I repeat that silver coin is subsidiary. The half dollar is not worth fifty cents. All other Governments pay the expense of minting by the difference between the intrinsic value of subsidiary coins and the value at which they circulate and at which the Government redeems them. And such was the law of this country until by a ruling of Mr. Guthrie, when he was Secretary of the Treasury, the Mint was ordered to receive silver private individuals and coin it. Now, it so happens that a constituent of the gentleman from New York has been taking advantage of that ruling and deposited silver to be made into half dollars and other silver coins; and for every two dollars' worth of silver deposited by him he gets four half dollars and one ten-cent piece, or the equivalent thereof. He has, as he stated to my colleague [Mr. Hooper, of Massachusetts] and myself, been doing a business of from eighteen hundred thousand to two million dollars per annum, giving him as profit an annual income equal to the salary of the President for the presidential term. Is it to be wondered at that that gentleman should suggest to the gentleman from New York that there might possibly be some loss to the Government in taking in the old copper and copper-bronze pennies and issuing new nickel one, two, and three cent pieces ?---[a heated debate between Potter and Kelley, who seem to have had a personal issue between them, on the metal content of pennies and nickels, but not a word on the meat of the story; Kelley makes a molehill out of the constituents of Potter but carefully avoids the real purpose of the bill and guides the attention of the House in a direction to nowhere. Kelley obviously heard and paid attention to what Potter said, and heard when Potter stated that this bill demonetizes silver and he doesn't take issue with that, in fact he makes the factually in-correct statement that silver coin is subsidiary to gold, when the law in effect at the time clearly declares that 412½ grain of silver in a $1 coin is the unit of measure. Years later pig-iron Kelley, with tears and humility, claimed that he did not know the bill demonetized silver, yet the Record indicates that even if did not read the bill and read section 14 of the bill, he was told by Mr. Potter that the bill did just that.]
Mr. Potter. I desire to say that the taking in of the old copper pennies has nothing to do with this matter, and I never heard of it.
Mr. Kelley. I have no doubt the gentleman's constituent carefully concealed from him his large interest in it while he plied him with petty plausibilities.
Mr. Potter. The gentleman knows that I have not a bullion dealer in my district. I represent an agricultural district.
Mr. Kelley. We take you as a Representative of the city of New York.
Again, sir, by a mistake in our law it has become impossible to retain an American silver dollar in this country except in collections of curiosities. They would, if coined in considerable numbers, be a source of enormous profit to the silver bullion dealers of New York. Let me show you. The silver dollar required by our laws is worth three and a half cents more than our gold dollar, and is worth seven cents more than two half dollars. Now, sir, let us get back, as the gentleman desires, to specie payment before we legislate upon the mint laws, and you will have an interest of from one million to many million dollars a year here with its lobby in and around the House to prevent the Government from the possibility of losing a few dollars by substituting copper-nickel for copper and copper-bronze coinage.
Every dollar we will then coin in silver will put from three and a half to seven cents in the pocket of the individual broker. Every half dollar for which he may deposit in silver and have it coined will yield him a profit of two and a half cents. I think we can afford to get new dies cut for the new nickel coinage if the silver bullion brokers of New York will let us save the millions we are now wasting on them in this way. Besides, sir, by doing this we may retain within our country a silver coinage, which we cannot do unless we do revise the laws in this respect. Why, sir, there is not a merchant in the world that would not gladly send gold here with which to buy American silver dollars and make three and a half cents on the exchange of every dollar. There is not a silver bullion dealer that would not gladly supply the vacuum felt by the forty million of the American people, who will use silver coinage when it shall again come into use, inasmuch as for every two dollars he would send to the Mint he would get back two dollars in half dollars and a ten-cent piece, and a silver dollar, worth 103½ cents, in exchange for every dollar deposited in gold. Would not this be a paying rate of interest ?---[nice fervent talk about nothing; you happily relegated silver to subsidiary status, how much will that cost the government and the people ?]
More than this, the silver coinage of England is ten per cent. below the gold standard. Ours is but four, and it would be matter of profit to the British Government to send silver bullion to our mints to be refined, parted, alloyed, and coined into half dollars, and then to carry it over to England and convert it into their own coinage at ten per cent. below gold standard value.
Now, sir, is the Government of the United States to be made the prey of the people of the world in order to give large profits to a few silver bullion brokers in New York ? For there is the whole question. Beyond that it is a mere question of petty detail. Shall the Government of the United States control its Mint ? The gentleman from New York [Mr. Potter] cannot tell without referring to the books who the Director of the Mint at Philadelphia is to report to, who the manager of the assay office at New York is to report to, who the manager of the Carson City mint is to report to. The law on this subject is in a chaotic condition. One reports to one, another to another, and another to a third officer of the Government. And there is no responsibility and no means of holding to duty those who violate the law.
But I have shown you but a small part of the profits that the bullion gamblers and dealers of New York city are making under our loose laws. It has come to the knowledge of the Government and of the Committee on Coinage, Weights, and Measures that the bullion in the Treasury of the United States is loaned out in the city of New York for profit to some one, not the Government. It has come to the knowledge of the Government that the managers of the New York assay office, or the sub-Treasury, when coin is abundant, will receive it on deposit and let favored parties among the coin and bullion dealer have the gold bars that are supposed to be and by law are required to be in the Treasury, and when coin becomes scarce will receive bars and hand to the constituents of the gentleman from New York, [Mr. Potter] who are disinterestedly opposing this bill, the coin to deal with and make a profit. Now here alone is a fraud running as I am assured and believe from three to seven million dollars a year, that this bill proposes to check, yet the gentleman from New York would resist its passage because something may be lost by changing our multiform penny and two and three cent pieces into uniform pieces of one, two, and three cents, so marked that the blind man can tell his coin by his sense of touch, and the least sensitive of us can distinguish one from the other in the darkness of night.
Now, sir, it is not my purpose to make an elaborate speech on this subject. I sought the floor at this time to point out the fact that in the existing state of things, with specie payments in abeyance, there is a job of from five to ten million dollars involved in the defeat of this bill; and that if we leave legislation upon this subject until specie payments shall have been resumed, that job will run up to anywhere from ten to twenty million dollars per annum, the amount depending upon the extent of our commerce and our coinage. I ask gentlemen to consider the provisions of this bill with the management of which I am no longer charged in the light of the facts I have stated.---[and none of ye gentlemen should even glance in the direction of, much less consider, section 14 and the changing of the unit of measure from silver to gold; Mr. Kelley wants to be lilly-white-Lillith and to claim innocence; Mr. Potter senses it right that Kelley is merely obfuscating the audience, even if he is wrong about what the bill actually covers; we will see similar performance from Kelley in his 1874 3.65-bonds speech and in his 1882 vote for the extension of the national currency bank system; throughout his political career he talked a good talk, but his actions were otherwise]
Mr. Potter. If anything was necessary to satisfy me that this bill was a cover, and that it was gotten up to be a cover, for this copper-nickel operation to which I have referred, it would be the speech just made by the gentleman from Pennsylvania, [Mr. Kelley]. He says there are jobs which it is necessary to correct by this bill. If so, then let them be corrected.
And if it be true --and I know nothing to the contrary, for I know nothing whatever in respect of the matter beyond what the gentleman says-- that the assay office of this Government at New York is so managed that a fraud is committed upon the Government of from three to seven million dollars a year, then by all manner of means let that fraud be corrected. If, as the gentleman says, the bullion brokers of New York city, or of any other place, make an improper profit from the fact that they can deliver a dollar's worth of silver to the Mint and receive back more than a nominal dollar's worth of coin; that is, coin debased to the extent of seven per cent---
Mr. Kelley. No, sir; I did not say seven per cent.
Mr. Potter. Well, coin debased to some extent below its nominal value. Then if it is worth while for us to correct that provision of law, let us do so. Only it will doubtless so happen that when the bullion dealer can get no profit whatever by delivering a dollar's worth of silver to the Mint and receiving coin of less real value in its stead, he will not choose to deliver his silver to the Mint on those terms. The condition of things which prevails in this respect has existed for years. If there is anything about it to be corrected --I do not know that there is; perhaps I ought to be ashamed to say I never heard of it before-- then the party of the gentleman, which has been in power for the last ten or twelve years, should have corrected it long ago.
But what I would call the attention of the House to now is the fact that when I say that this bill provides for the recoinage of several hundred millions of base pieces of coin, and the Director of the Mint at Philadelphia writes to the Secretary of the Treasury that the new pieces will have no advantage over the old, and no reason can be assigned for the recoinage, except that persons are interested in the nickel material of which they are to be recoined --when I say this, then the gentleman from Pennsylvania, [Mr. Kelley,] who has not been heard of before on this subject, at once springs to his feet, and, without refuting a single objection advanced against the bill, imagines constituents for me that I never heard of before, constituents who do not even exist, so far as I know, in my district, and imagines jobs about which I know nothing, but which may exist for aught I do know, but the charge of which come from him like the cry of one who escapes and seeks to avoid detection by his cries; and by these false issues would mislead the House from the real objections to this bill. I call the attention of the House to these facts; for they all go, I repeat, to confirm me in the belief that something besides a mere revision of the Mint laws was the purpose of this bill, a belief I derived in the first instance simply from reading the bill, for I have had no communication from anybody about it except a communication from the Chamber of Commerce of New York, which I hold in my hand, and from Hon. S.B. Ruggles, who was the commissioner sent by our Government to the general coinage convention held in Europe a few years since. Those are the only communications I have seen, except from officials of the Government, in respect to this measure. Yet from the bill itself and the speech of the gentleman from Pennsylvania [Mr. Kelley] I am convinced that under the general form of revising the Mint laws --a revision which even the Director of the Mint at Philadelphia does not advocate-- that under the general form of revising the Mint laws at a time when we have no coinage in circulation, and we do not expect to have any very soon, there lies at the bottom of the whole thing as the moving purpose, or one of the moving purposes, this provision for the recoinage of several hundred millions of nickel-copper pieces. ---[even the silver pennies are demonetized]
Mr. Kelley. I yield to the gentleman from Illinois, [Mr. McNeely,] my colleague on the committee.
Mr. McNeely. Mr. Speaker, I take no part in the fight between the gentlemen from the cities of New York and Philadelphia, [Mr. Potter and Mr. Kelley.] As the gentleman from New York, on a former occasion, while this subject was being considered, drove the gentleman from Pennsylvania out of the House with his bill, I suppose the gentleman from Pennsylvania has a right to renew that fight. But, sir, since this bill was reported by the acting chairman, to which report, as a member of the committee, I then objected, because the committee had not authorized it, the committee have carefully and patiently considered the reported bill. We have examined and taken the advice of men well posted on the subject, and after having made some amendments I find nothing in the bill to which I object, and many things which are improvements upon the law as it is now. Still, sir, I am not yet so well advised upon the subject as to say that the bill in all of its provisions is right. It is an important subject of legislation, affecting the circulating medium of the country, and should be well considered before we change existing laws.
Mr. Potter. The gentleman from Illinois speaks of me as "the gentleman from New York." I wish to say that I am not from the city of New York, and know nothing whatever about the position of that city in reference to this bill. What I have said on this question is from my general knowledge of the subject as a Representative.
[Fernando Wood, a copper-head, a "grand sechem" in the famously corrupt Tammany Hall. On January 15, 1868, censured for stating that HR 439, supplement to the March 2, 1867, reconstruction act, is "a bill without a title, a child without a name and probably without a father, a monstrosity, a measure the most infamous of the many infamous acts of this infamous Congress."
Mr. Speaker, I do not propose to participate in this issue between the gentleman from Pennsylvania [Mr. Kelley] and my colleague, [Mr. Potter.] I only say as one of the Representatives from the city of New York that the gentleman from Pennsylvania has made statements with reference to the bullion brokers of New York and their supposed interest in defeating this bill which are entirely new to me; that if, outside of the communication referred to by my colleague as emanating from the Chamber of Commerce, and one or two articles in the Journal of Commerce, there is any movement in the city of New York hostile to this measure, it certainly has not come to my knowledge, nor has any application against the bill been made to myself.
My prejudices, if I have any, are all in favor of this bill. I recognize the subject to be exceedingly difficult to understand; and I am not surprised that such intelligent gentlemen as the Representative from Pennsylvania and my colleague should differ as to the meaning and intent of certain provisions of the bill. Of all the questions that we have been called on to legislate upon during this Congress I look upon this bill as the most complicated, the most intricate, the most difficult to be comprehended by men who are not experts, who are not familiar with the practical operation of coining money and the assaying and refining preparatory thereto. I have taken some little trouble to comprehend the bill, and to understand, as best I could, the necessity for it.---[why hasn't everybody else taken "some little trouble" ? if the bill was available to Mr. Wood and Mr. Potter (both of whom supports section 14), it was available to the whole House.]
There can be no question but that the laws relating to this subject require revision, and that this branch of the public service demands reorganization and improvement. The Constitution gives to Congress the power to coin money, to regulate its value, and to fix the Standard of weights and measures; and as early as 1792 it exercised this authority by the establishment of the first Mint.
It appeared to have been the design, originally, to locate the Mint at the seat of the national capital, which was then at Philadelphia, but influences prevailed to retain it at Philadelphia, though the capital has been removed. Under the law of 1835, however, branches were established which subsequent legislation has increased.
With reference to the regulation of the coinage of the United States, and of the refining and assaying of gold and silver bullion, various laws have been passed. It is very evident, however, that there has never been any comprehensive plan established by law which regulated the whole subject, and gave it that importance which it deserves. It is now, as has been stated by the gentleman from Massachusetts [Mr. Hooper] and the gentleman from Michigan, [Mr. Stoughton,] nearly thirty five years since the Mint laws have been revised. During that period there has been a vast extension of business, a multiplication of mints and assay offices, a reduction in the weight of silver coins, and a further issue of base coin other than the old cent, all the result of isolated acts of Congress, several of which conflict with each other. As an illustration of the effects of this want of permanency as to the base coin from one to five cents, it is only necessary to enumerate those issued for a few years back, as follows:
No. 1. Copper cent.
No. 2. Cent-- eighty-eight per cent. copper and twelve per cent. nickel.
No. 3. Bronze cent.
No. 4. Bronze two-cent piece.
No. 5. Copper-nickel three-cent piece.
No. 6. Copper-nickel five-cent piece.
No. 7. Silver three-cent piece.
No. 8. Silver five-cent piece.
There have been several other variations in coins of a higher value, to which it is not necessary to refer. At this time much of the control of this service is dependent more upon the regulation of the Treasury Department than the authority of law.
This is an evil which should be corrected. It is productive of insecurity and instability, and subject to the uncertainties of circumstances which may become of serious injury. The Secretary of the Treasury, in his last annual report, admits the necessity of some immediate action by Congress. He says that---
"Although the mints and assay offices are nominally in charge of the Treasury Department, there is not, by authority of law, any person in the Department who, by virtue of his office, is supposed to be informed upon the subject, and none on whom the Secretary of the Treasury can officially rely for information as to the management of this important branch of the Government business."
There can be no doubt, therefore, of the necessity of the establishment by Congress of some comprehensive system, which shall not only protect the interests of the Government, but also, and at the same time, concentrate the official authority with responsibility and efficiency. It is impossible to enumerate the many abuses which now exist, and which, from time to time, have heretofore been practiced. It is said that in New York, without authority of law, deposits of bullion were received not long since upon which loans were made by certificate; these certificates passed from hand to hand, with all the confidence of the gold certificates of the Government, amounting to many million dollars. Thus the responsible officers of the Government took it upon themselves, without authority of law, to issue the so-called obligation of the Government; and I have authority for the statement that in some cases the deposits themselves were of an insufficient value to secure the amount of the certificates issued upon them; and another flagrant case is the present scandalous job in connection with the private assaying company at San Francisco. With reference to this case the New York Journal of Commerce, the leading commercial newspaper of the United States, has the following:
"This job originated in a proviso adroitly interpolated two years ago in an appropriation bill for the San Francisco mint. It reads: 'And provided further, That it shall be lawful, until after the completion and occupation of said branch mint building, to exchange at any mint or branch mint of the United States, unrefined or unparted bullion, whenever, in the opinion of the Secretary of the Treasury, it can be done with advantage to the Government.' A large private establishment in that city under this arrangement secures an immense job of refining most of the gold thus treated on that coast at eight cents per ounce gross. The nominal charge at the mint there is eleven cents. During the last fiscal year $19,000,000 were deposited in San Francisco by the miners. The Government establishment should have received all this from the owners, paid them for it at a charge, say, five cents per ounce gross, and then put it into fine bars of nine hundred and ninety-eight thousandths fine at a profit to the Treasury. Instead of that the mint there fixes the charge at eleven cents per ounce. This drives $13,000,000 direct to the private refinery, but $6,000,000 still reach the mint. Under this contract that, too, is handed over by official fingers to the private refinery. Eight cents per ounce is paid for having it turned into bars, mostly ranging from nine hundred and eighty-nine to nine hundred and ninety-three thousandths fine, and then the mint takes it all (the $19,000,000) and gives coin for it. If the charge for coinage could be abolished, or reduced to less than its actual cost, as proposed in this bill, the 'ring' would have a still softer thing of the existing job. If the mint should part the gold as it ought, at a proper cost, the bars would be finer, and at least $10,000 be saved to the Treasury out of the silver mixed with the gold, which is now wasted or wholly unaccounted for."
The history of this proviso is interesting. Not understanding how a provision of law of so general a character as this could get into an appropriation bill, I have endeavored to ascertain the modus operandi by which this was accomplished. It appears in the miscellaneous appropriation bill, approved July 15, 1870, as a proviso to an appropriation to continue the branch mint at San Francisco of $150,000. This is the way it stands in the law, and I have examined the Journals and proceedings of both Houses, as reported in the Globe, to find out, if possible, how it got there. There was nothing of the kind in the original bill as reported from the Committee on Appropriations of this House, nor was any such amendment suggested or proposed to the bill when under consideration in the House. The bill went from the House to the Senate without any such proviso or any amendment at all referring to that subject, nor was any proposed in the Senate. Other amendments were made there which caused the bill to be sent back again to the House, but neither House had acted upon or had proposed to it any such proposition. The two Houses disagreeing, the bill went to a conference committee, which, it appears, took upon itself, without the knowledge or consent of either House, of interpolating this proviso into it, and thus consummating a legislative fraud in the interest of private corporations in San Francisco.---[The same process will be used to alter and pass this bill; seems like a well-worked out, often-used method]
I have thus referred to a few of the objections to the present business of refining and coinage by the Government. Being thus convinced of the necessity of a general revision by Congress of the laws and practice, I come now to consider whether the bill before the House will successfully accomplish that purpose.
So far as this bill proposed to concentrate the Mint and coinage of the United States into a bureau of the Treasury Department, embracing under its control all mints for the manufacture of coin, &c., there can be no objection. So far as the bill will concentrate and simplify the operation of the Mint and its branches, it will be a great improvement. There are matters of detail, however, referring to the machinery and organization of the bureau, and to the regulation and assaying of the coinage and changing the value of the coins, which affects the questions of the standard of value, and upon which none but those who have studied the subject with great care are capable of reaching a conclusion.---[once again, if he noticed it, others could have noticed it, too; if they didn't, now they heard it from Mr. Wood, therefore they can't claim that they did not know; Blaine was sitting in the Speaker's chair, yet he later claimed that he did not know]
Upon the discovery of gold in California, in 1848, the whole amount of coin in the world was estimated at $1,800,000,000. It is now estimated to be about four thousand millions, or an increase of about twenty-two millions within twenty-three years, four fifths of which have been coined from bullion procured in the United States. This large addition to the standard of value has materially affected the value of every species of property, real and personal. This increase is applicable to every article known to commerce. The law of supply and demand is so exacting that even theorists like Mill and others have been obliged to recognize it. Another effect of an addition to the volume of coin is felt in the stimulant that it gives to human energy. This fact was shown in the wonderful change that came over the country after the development of our California mines. For the ten years preceding our late civil war the country enjoyed a high state of prosperity. Alison, the English historian, refers to the like effect in England. He dwells with much force upon this subject, saying that "this effect to the immense addition to the currency of the world, to the industry of all nations, and in an especial manner of the British isles, has been prodigious."---[so the increase of gold was not detrimental; the inflation of the money supply did not produce unemployment, economic hardship, credit bubble, speculative bubble; the decrease of the purchasing power of the unit of measure did not upset the nation's economy; no, it produced increased economic activity and prosperity; so who objected to the increased number of gold and silver coins ? the farmers? the city labourers? who?]
None but experts and those who are familiar, by long study and patient examination, of the practices of European Governments, can comprehend and determine some of the subjects included in this bill. Indeed, the depreciation in the value of the precious metals, which has been going on for the last twenty years, by the discovery and working of new gold and silver mines, has materially affected all values. The standard produced by coinage has become, of course, more difficult. The great commercial law of supply and demand has had its influence on this as well as on every other species of property; hence there can be no standard, as such, made by law. Very many influences operate to create a change, when the law itself which attempts to regulate it still remains upon the statute-books. This fact has developed itself in Europe as well as here.
This bill proposes to establish a bureau, to be attached to the Treasury Department, for the regulation and control of the whole subject. It applies to all of the details, going extensively into the operations, and placing the whole service under the control of law. To judge of the propriety of many of these provisions is a difficult task to undertake. Few persons outside of those who have been made familiar with the subject by practice can possibly understand them. I have taken some trouble to make myself acquainted with the proposed changes from existing laws and regulations, and, as a general thing, give them my approval. There are, however, some sections open to criticism and doubt about which the best judges differ in opinion. In some respects the bill does not go far enough, and in others too far. I shall propose two amendments, one to section forty-seven, as to the charge of refining and parting bullion, intended to limit it to that allowed for and deducted from the the same operation in the exchange of unrefined for refined bullion, and that the privilege for making this exchange shall be open to all. The object of this amendment is to prevent collusion with outside establishments, and to make the cost for refining no greater than necessary to individuals.
I desire also to repeal the proviso put into the appropriation bill approved July 15, 1870, to which I have referred, and thus to erase from the law a provision dishonestly incorporated into it, and which can have no other tendency than to be productive of fraud. I am opposed to the Government having any transactions or connections with private refining establishments. The whole business of smelting, refining, assaying, and coinage should be exclusively under the control of the Government, and there should be no other connection between individuals and this department than there is necessarily in the reception of the metal in its natural state, and the emission of coin as a governmental standard of value for general circulation. I do not wish to be understood as sanctioning the abolition of all private establishments for refining gold bullion, but that all connection between them and the Government should cease, so far as employing them for the purposes of the Government. Great abuses have followed this practice.
Since soon after the discovery of gold in California these private refineries were warmed into existence in that State, and the first act, passed March 4, 1853, recognizing them, and inviting their coöperation for coinage purposes, was doubtless lobbied through Congress for improper purposes. A subsequent act of February 20, 1861, served to further encourage the establishment of private refineries. In San Francisco there are two of these establishments which have succeeded in assuming control of refining, and of excluding it almost entirely from the branch mint in that city. The result of this has been to entail considerable loss upon the United States, besides rendering insecure much of the bullion in the process of exchange. The present arrangement, so far as San Francisco is concerned, is open to grave suspicions of collusion. It is very evident that some one has influence enough to continue in existence an arrangement with these outside parties at the expense of the Government.
Another objection to this system is that the Government is open to imposition by the charge of excessive rates for refining if dependent upon private establishments, and this operates to the injury of the individuals who deposit the bullion with the Government for that purpose. If dependent entirely upon outside establishments, it may be compelled at any time to submit to exorbitant charges, whereas if it is retained exclusively in the hands of the Government, no such difficulty could arise. The present charge for refining, both by the private refineries and the Government, is largely in excess of what it should be. By the sulphuric acid process it can be done for one fourth as much as by the nitric-acid, and gold can be refined by it to a higher degree and in about one fourth the time. In Europe this process is now universally adopted, and refining has been brought to such a nice point and so closely economized, as to cost, either by wastage or otherwise, less than one eighth of what it does here. I have lately seen an elaborate analysis of the cost of refining in England, which sustains this estimate of its expense. I am therefore confident that the Government should hold exclusive control over the whole subject, from the original reception of the bullion, through the various processes of separation, refining, assaying, and coinage, until its final completion and issuance. I would go much further, and include even the mining operation, as has been done in Russia for three hundred years.
In 1868 I discussed on this floor the policy and practicability of the Government availing itself of its mineral properties in the Pacific States, and showed that it was unwise for it to resort to borrowing and taxation when it possessed in its own right almost inexhaustible treasures in the precious metals. Some of the most enlightened and prosperous nations in the world have successfully worked their own gold and silver mines, thus placing directly into the treasury the wealth which we permit to go into the pockets of individuals and private corporations. Were we out of debt and with but trifling taxation, the reason for this assumption by the Government of its mining property would not exist, but situated as we are, sound policy requires that we should make available the wealth which legitimately belongs to us. By the law of 1866, mineral lands were allowed to be taken up at five dollars per acre, and even this small sum has not always been paid. Adventurers and squatters have taken forcible possession of the most valuable deposits of the precious metals in the world, and have held them to their own advantage without any interference upon the part of our Government. Many of these mines are the property of foreigners who are working them on foreign account, and who receive regularly the whole proceeds in Europe.
But I do not propose that we shall interfere with existing private rights, whether legally or illegally obtained. I am willing to concede them as vested by virtue of possession; but with reference to the unexplored and undeveloped remaining mineral regions, estimated of incalculable value, I would have the Government avail itself without delay. It is estimated that at least $2,000,000,000 in value of gold and silver and quicksilver have been procured from California and contiguous territory since its purchase from Mexico. More than one half of this was obtained at very little outlay before the erection of costly buildings. We can suppose, if such an amount of treasure could have been procured at so little expense, what the Government could not have done with its superior advantages of capital and of power to procure superior scientific metallurgical skill. I have no doubt but that the Government, under a proper system to be devised by Congress, could organize a mining department as part of its coinage duties; explorations could be made by competent geologists, the deposits of gold and silver be more definitely ascertained and more efficiently developed; works could be constructed and managed by engineers of capacity, who were familiar with such operations, and in a few years the result would astound the world. We would be able to supply our own mintage, and doubtless have a large surplus which would greatly increase the material wealth of the nation.---[Increased number of gold and silver coins would increase "the material wealth" ??!!?? don't let them economic theologians of bank paper hear such heretic talk]
There is another subject in connection with American coinage worthy of some consideration. I refer to the proposition to create a coin of universal international value. This subject has been very much agitated in Europe within the past five years. In the summer of 1867 the representatives of the leading Governments of the Continent met in convention at Paris, and discussed this proposition intelligently and elaborately. This country was represented by Mr. Ruggles, of New York, who has written much upon the subject. Our own Government has had much correspondence with others looking to the same result. That with Sweden was recently submitted to the Senate. From it it would appear that even the Scandinavian States, Sweden, Denmark, and Norway, have failed to unite in an equal coin of like value, and even the coins of Sweden and Norway, which are under the same Crown, differ with each other.
Although there is now an attempt being made to revive this subject in Europe, it does not appear to meet with that favor to which its merits unquestionably entitle it. The disturbed political condition of Europe for the last two years has undoubtedly had its effect in preventing the further promotion of international coinage. I have no doubt, however, that sooner or later this will be accomplished. It seems extraordinary that the nations of Europe, so compact in population, and so consolidated in commercial intercourse, and united by rail and telegraph, should differ so much as to the value of the coins in general circulation. The confusion, losses, and difficulties to the trading people, arising from the want of a coin of a universal acceptance as to value, must be apparent to all. Indeed, there is no one thing that more illustrates the want of intelligent progress than this. In this country we have seen the advantage of the national bank currency, which is accepted and received by its face value in every part of the Union. Who would abolish it and recur to the old State bank system, where the rates of discount upon the circulating medium varied from one half to twenty per cent. ? We all remember the losses, embarrassments, and trouble occasioned by the then condition of our cash moneyed system.
While these difficulties do not exist in Europe the same extent, yet they do exist there, to which every traveler is especially subjected. Therefore I assume that sooner or later, and it may be very soon, the Governments of Europe, from the necessity of the case, will be compelled to issue a coin which will be recognized of universal international value, which, at least for purposes of ordinary trade and commercial exchange, will be the standard. Hence it may be well for us to consider, in the passage of a general law providing for the making of coins, whether this should not be comprehended. It is true that hereafter Congress could at any time amend the law so as to meet such a measure, if an international coinage in Europe and this country could be agreed to.
Mr. Sargent [Aaron Augustus Sargent, studied law, admitted to the bar, wrote the 1861 Pacific Railroad Act, voted for greenbacks & national currency banks, future "Senator for the Southern Pacific Railroad"]. Mr. Speaker, the gentleman from New York [Mr. Wood] is entirely mistaken in his statement of the result of the examination made by him into the history of the legislation by which the provision referred to by himself found its way into the miscellaneous appropriation bill. I do not question the good faith of his search; I simply say that the result is entirely erroneous.---[who gave him the floor? and why is this his biggest problem?]
Mr. Wood. I will say to the gentleman that the search was made for me by the Librarian of the Hall Library of the House.
Mr. Sargent. Then the Hall Librarian of the House was mistaken if he gave the gentleman any such information. I hold in my hand the original document which came from the Senate of the United States containing its amendments to the sundry civil bill at the second session of the last Congress. I read from the heading of those amendments:
In the Senate of the United States
June 12, 1870.
Resolved, That the bill from the House of Representatives (HR. No. 2165) entitled "An act making appropriations for sundry civil expenses of the Government for the year ending June 30, 1871, and for other purposes," do pass with the following amendments.
Then come the amendments, numbered from one to sixteen. I send to the Clerk's desk the sixteenth amendment to be read.
The Clerk read as follows:
"At the end of line twenty-three insert: And provided further, That it shall be lawful until after the completion and occupation of said branch mint building to exchange at any mint or branch mint of the United States unrefined or unparted bullion for refined or parted bullion, whenever in the opinion of the Secretary of the Treasury it can be done with advantage to the Government: Provided, That the weight, fineness, and value of the bullion received and given in exchange shall be determined by the mint assay: And provided further, That the authority hereby given shall not be construed so as to interfere with the rights and privileges now or heretofore enjoyed by depositors of bullion at said mints."
Mr. Sargent. That is the amendment as it was adopted in the Senate. Here is the bill we sent to the Senate. It is the bill as it was passed by the House. Here are the amendments of the Senate with which the bill came back from the Senate to the House. It was near the close of the session when the amendments came back from the Senate to the House bill, and my recollection now is that the House non-concurred in all the amendments of the Senate, and sent them to a committee of conference. The report of the committee of conference I hold in my hand. The managers of the conference on the part of the House were Hon. Henry L. Dawes, Mr. A. Sargent, and Hon. James B. Beck, and our report is as here stated, that the Senate receded from certain of its amendments, and that the House receded from its disagreement to amendments of the Senate numbered one, two, three, and so on, with some exceptions, until we came to number sixteen, and the House receded from its objection to that sixteenth amendment, and it became a part of the law.---[Oh, so you were one of them "legislators" that is why you sprung to your feet; is this piece of legislating the facilitator of those corrupt practices listed by Mr. Wood? now what do you have to say about demonetizing silver ?]
Mr. Wood. I said I had caused examination to be made, and that was reported to me as the result of that examination. I have told the gentleman and the House who made it for me. I am glad to be corrected. I am satisfied, so far as I stated that it was placed in the bill by the committee of conference, in that regard I was in error, as it appears it originated in the Senate.
Mr. Sargent. Mr. Speaker, the legislation of that time was not peculiar, or as announcing any new policy. As far back as 1853 Congress provided as follows:
"Sec. 5. And be it further enacted, That when private establishments shall be made to refine gold bullion, the Secretary of the Treasury, if he shall deem them capable of executing such work, is hereby authorized and required to limit the amount thereof, which shall be refined in the Mint at Philadelphia from quarter to quarter, and to reduce the same progressively as such establishments shall be expended [extended?] or multiplied, so as eventually and as soon as may be, to exclude refining from the Mint, and to require that every deposit of gold bullion made therein for coinage shall be adapted to said purpose without need of refining: Provided, That no advances in coin shall be made upon bullion after this regulation shall be carried into effect, except upon bullion refined as herein prescribed."
Carrying out the idea that the constitutional duty to coin gold should be executed by the Government of the United States did not imply that the Government should turn itself into a manufactory to do the refining of gold, or, as the gentleman from Michigan [Mr. Stoughton] well said, it did not require it to do that any more than to go into the business of the original production of gold.
This was in 1853, and is to be found in volume ten, page 210 of the Statutes at-Large. Consistent to this idea, Congress subsequently, in 1861, as I find in volume twelve, page 144, of the Statutes at-Large, enacted as follows:
"Sec. 3. And be it further enacted, That the provisions of the fifth section of chapter ninety-seven of the act of Congress approved March 3, 1855, requiring the Secretary of the Treasury to limit the amount of refining at the Mint whenever private establishments shall be capable of refining bullion, shall be extended to the several branches of the Mint and to the United States assay office at New York in all cases where deposits of bullion are made for coins or fine bars."
No, sir, the provision in 1870, to which the gentleman alludes, was in the strict line of this former legislation, and I believe upon the same wholesome principle.
The assertions made in the New York Journal of Commerce, so far as they go to imply that the refining should cost but the smaller amount mentioned there, and consequently that there is an overcharge by private establishments now doing this refining at San Francisco, are in error. The essential elements of the calculation are left out. In private refining establishments there are the establishments themselves, the real estate, the clerks, the superintendents, as well as the skilled laborers employed in the various processes of refining. But in the calculation made in the New York Journal of Commerce nothing of this kind is included. The actual cost is put at eleven cents, as in San Francisco, if you reckon the cost, the interest on the investment of the Government, the cost of the superintendence, and the clerks who manage this business.---[you had read the article and made a mental response to it already, or while Wood was speaking you went into overdrive to find response to his remarks......]
Now, I have found by my own observation the fact to be justified which I anticipated at the time as a member of that committee of conference between the two Houses, when I assented to vitalize the previous legislation of Congress on this subject. I have found in my observations in California that bullion or crude gold in the hands of the miner, who produces it and sends it to the Mint, is advanced on an average one half of one per cent. Bullion went up at once in the hands of the original producers, because by this process they were enabled to get nearer to its actual value. The Government by its policy for several years, and by its legislation of 1870, had encouraged private establishments to go into this business, which it ought not to carry on itself. It has induced capital to be invested in it, and these establishments are now performing this work with a guarantee of the Government protecting the depositors, and at the same time protecting the Government; and it is unfair, it is wrong for the Government now to cease this policy, and to say that the capital invested in these private establishments shall in any event be lost or destroyed by reversing the policy of the Government in this particular.---[this is the same old argument of vested rights and interests and granted privilege as inviolable contract....]
In these private establishments they use the sulphuric acid process, this being the only place on the Pacific coast where it is used. It is a process which cannot be used in the Mint for want of room, and on account of the fumes which arise from it, and the costliness of the process; the result, however, being a finer assay than is attained by the old process.
I do not care at this stage of the bill to discuss this matter at any length; but I wish to say that there are other reasons besides those which have been suggested why this bill should pass. We now give a premium for the exportation of gold from our own country by the present coinage charge of one half of one per cent., a higher charge than the cost of the coinage. The result is that our gold takes itself away, and goes over to countries, such as England, where there is no coinage change. The policy there has been tested by experience, and when, a few years since, there was an attempt to change the policy of the English Government in that respect, and to put on a seigniorage, after a full and exhaustive examination it was voted down. The effect of sending away our gold in consequence of this coinage charge is, that it depletes our own market, while it necessarily aids the business of other countries. By reducing the coinage charge as proposed by this bill to one fifth of one per cent. we remove the temptation for its exportation, and so far give some advantage for the resumption of specie payments in this country. But if we keep up the charge at the rate at which it has been for the last twenty or thirty years --and it was a new experiment when it was introduced-- the effect must necessarily be the depletion of this country of the bullion we produce and we shall become tributary to the London market, making that the bullion market of the world, while New York or San Francisco ought to be such.
There are some matters of detail in this bill which, when we come to consider it by clauses, I shall desire to speak upon, but I shall not take up more of the time of the House at present.
Mr. Brooks, of New York. I want to call the attention of the gentleman from Kentucky, [Mr. Beck,] who was a member of the conference committee, to the clause in the conference report which has been referred to, and to inquire what construction he gave it ?
Mr. Beck. I have not been in the House throughout this debate and do not know anything about the course it has taken. The gentleman from New York [Mr. Brooks] inquires of me what was meant by this clause:
It shall be lawful until after the completion and occupation of said branch mint building to exchange at any mint or branch mint of the United States.
I suppose, then, that it referred to the United States Mint and branch mints.
Mr. Sargent. I do not know whether the gentleman from Kentucky understood the matter at the time. I thought he did, because he is very intelligent about these matters and this provision was discussed in the Senate for two or three days, and it was not an unusual provision, because, as I have shown, it was enacted in 1863 and again in 1871.
Mr. Beck. I only desire to say that of these matters relating to mints and coinage I was comparatively ignorant, and had great faith in the conferees, who knew more about it than I did; but that was the construction I put upon it. I have been out of the House all morning, and have just come in, and do not know, even, what bill is up.
Mr. Wood. Did it give the right to private refiners to do this work ?
Mr. Sargent. I understand that the word "exchange" simply meant this: that unrefined or unparted bars received at the Mint might be exchanged for refined and parted bars from any person outside.
Mr. Wood. That is the construction of the Secretary of the Treasury.
Mr. Potter. Exactly. The Mint takes the metal that comes from the miners and gives them in exchange refined bars that come from the refiners on such terms as the Director of the Mint sees fit. I understand that those terms now are to allow the refiner eleven cents per ounce on every ounce of refined metal, whereas I understand that the exchange can be made at the assay offices of the Government at one and a half cent on the ounce.
Mr. Sargent. That statement would be true if you provide that the mints and assay offices shall cost nothing for buildings, nothing for officers, or other expenses. The gentleman's idea seems to be for the Government to run an opposition to the private assay offices, on the ground that it costs nothing but for the workmen who manipulate the bullion. The gentleman and his friends of the Chamber of Commerce ought to consider the elements that go into the consideration of the business.
Mr. Potter. I agree with my friend that we ought to consider all the elements that enter into the calculation. It costs the Government in actual expenditures for everything one and a half cent per ounce. It costs the private parties who refine eleven cents an ounce, and the only question is whether the remaining nine and a half cents are proper charges to cover the cost of building, and superintendents and officers. Now, according to the information I have, they are excessive.
Mr. Sargent. Instead of costing the Government a cent and a half an ounce it costs the Government eleven cents an ounce in New York.
Mr. Potter. That is not the information I have. It is not the calculation of the officers there.
Mr. Brooks, of New York. I wish to call the attention of the House at this point to the danger of these conference committees. The year before last this same proposition was brought forward here and met with no support in this House except from California, and here it is put in when no one excepting those upon the conference committee knew anything about it. This should put the House upon its guard against reports of conference committees.
Mr. Sargent. It may put the House upon its guard against passing any laws whatever, I yield now to the gentleman from Massachusetts.
Mr. Hooper, of Massachusetts. In reply to the remarks of gentlemen in regard to the cost of assaying at the mint at New York, I would like to call attention to this fact, that the expenses of the assay office for the year ending June 30, 1871, excluding the salaries of officers and clerks, amounted to $103,823.61.
The deductions for the same period were as follows: for parting charges, $24,469.62; for bar charges, $15,688.86; making in all $40,158.48, leaving a difference of expenses over income of $63,665.13, and showing that even at the rate of five cents per ounce for parting, the sum realized from that and all other charges at the assay office by the Government for refining, parting, and stamping is less than half the expenses incurred for wages, materials, and other incidentals.
Mr. Wood. By the nitric acid process ?
Mr. Hooper, of Massachusetts. This is by the sulphuric acid process.
Mr. Wood. Is not the gentleman from Massachusetts [Mr. Hooper] in possession of a letter from one of the leading authorities of England upon this question, in which he says that he thinks that this can be done at comparatively no cost to the Government, by the construction of the proper works for the sulphuric acid process ?
Mr. Hooper, of Massachusetts. The experience of last year shows that refining can be done for five per cent. by the sulphuric acid process.
Mr. Stoughton. Heretofore eleven cents has always been the price charged by the Government for refining and parting gold. There were establishments upon the Pacific coast run by the sulphuric acid process that could part the metal cheaper than it could be done at the Mint. Consequently gold in the crude state was put in the Mint for the purpose of having the Mint responsibility, and turned over to these parties to be refined and parted, and they were paid eight cents for it, leaving a profit of three cents to the Government.
Now, it may be that it can be done a great deal cheaper in New York, because there we have provided an assay office, the buildings and the necessary workmen, and they are run by appropriations from Congress. When they have all that, of course they can refine the gold cheaper. But take that out of the account, and they cannot refine gold any cheaper there than in San Francisco. I insist that it is cheaper for the Government to have the gold refined at private refiners in San Francisco, than to compel people to bring it all the way across the continent to New York to be refined. It is not the duty of the General Government to refine gold. The Constitution gives Congress power to make all laws relating to the coinage of money, not the refining of metals. That properly belongs to individual enterprise. It would be better to encourage the establishment of private institutions for that purpose, than for the Government to arrogate to itself a branch of business which is not guarantied to it by the Constitution, and which does not properly belong to it.
Mr. Hooper, of Massachusetts. I propose now to offer some amendments to this bill. The first is to the first section of the bill, to strike out the words "or assay," and insert the words "and all" before the words "officers for the stamping of bars."
The amendment was agreed to.
Mr. Hooper, of Massachusetts. There are several verbal amendments which do not change the character of the bill, and which I have handed to the Clerk to be noted by him. I will call attention to one or two that are more important. In section fourteen of the bill---
Mr. Wood. I understood that this bill was to be read by sections for amendment. I would suggest to the gentleman from Massachusetts [Mr. Hooper] to allow that to be done, and his amendments can be acted upon when they are reached.
Mr. Hooper, of Massachusetts. Very well. I will ask unanimous consent that this bill be considered by sections in the House as in Committee of the Whole, under the five minutes rule.
No objection was made; and it was ordered accordingly.
The first section, as amended, was read as follows:
That the Mint of the United States is hereby established as a bureau of the Treasury Department, embracing in its organization and under its control all Mints for the manufacture of coin, and all offices for the stamping of bars, which are now or which may be hereafter authorized by law. The chief officer of the said bureau shall be denominated the Director of the Mint, and shall be under the general direction of the Secretary of the Treasury. He shall be appointed by the President by and with the advice and consent of the Senate, and shall hold his office for the term of five years, unless sooner removed by the President, upon reasons to be communicated by him to the Senate.
Mr. Brooks, of New York. I move to strike out section one of the bill. I frankly avow that my object in doing so is to end this bill. It seems to me that this is the most farcical spectacle that Congress can present at this time, when Uncle Sam is covered all over with rags, from head to foot, and there is not a portion of his garments fit to wear in public, for all is so ragged; when no member of this House has seen a silver dollar or a golden eagle, except as a curiosity in a museum, for some four or five or six or seven years, and when there is no probability of seeing another golden eagle for some six or seven years to come. It seems to me to be the greatest of farces for this House to present such a spectacle as this, one fit for the pencil of Morgan or Nast in the caricatures of the day; this exhibition of two hundred and forty intelligent gentlemen deliberating upon the subject of coins and coinage; more especially when the Supreme Court of the United States has recently declared that gold and silver are no longer money, but that under the power in the Constitution, to coin money there is power to print in the Treasury building Treasury rags at the disposal and under the authority of Congress. What farce greater than this is ever enacted in any comic theater here or elsewhere ? What is more calculated to excite ridicule in the country than so extraordinary a spectacle ?
If my honorable friend from Massachusetts, [Mr. Hooper,] who hitherto, or in better days gone by, led the van of specie payment, and whose heart is sound and right on that score now, and whose duty it is with sound heart and sound head to give utterance to the soundness of his sentiments, had in a bill like this advocated the resumption of specie payments, I should have stood side by side with him in advocacy of his bill. But I decline, Mr. Speaker, here or elsewhere, in this magnificent theater of the Capitol or any other comic play-house, to take part in the performance of any ridiculous act like this to coin gold and silver when no one has seen gold and silver for several years.
[Here the hammer fell.]
Mr. Sargent. As the gentleman from Pennsylvania, [Mr. Randall] near me, has very well suggested, the gentleman from New York has not in his speech stated a single, solitary objection against the passage of this bill.
Mr. Brooks, of New York. I have declined to play in any such performance.
Mr. Randall. If the bill were to provide for the removal of the United States Mint to the city of New York, then, of course, it would be all right in the gentleman's estimation, and he would be ready to advocate its provisions.
Mr. Brooks, of New York. The whole thing is extremely comic to me.
Mr. Sargent. The gentleman from New York thinks it extremely comic for members of the House to sit here and gravely consider the provisions of this bill. I think, however, he will find it extremely difficult to exclude from consideration the fact that the annual production of gold and silver in this country amounts to about seventy million dollars. Now, sir, if it be true that by the provisions of the coinage laws, as they are now, most of the gold and silver produced in this country takes wing and flies to other countries, thus rendering it impossible if the depletion of the precious metals shall continue to take place, for us to return to specie payments, which the gentleman does not seem to anticipate will ever take place, it may be well for us to consider, Mr. Speaker, whether it is not time now to so amend the law as to enable us to keep this gold and silver in our own midst. That consideration alone ought to raise this bill in the estimation of the House, and in this respect secure from even the gentleman from New York serious attention. In this bill there are very many useful provisions in view of the interests and wants of the country at this time, and if Congress has neglected them heretofore, it is the very best reason in the world why they should no longer be left unprovided for.
Now, the gentleman from New York [Mr. Brooks] does not seem to understand that there are now some sections of the Union where gold circulates by the million of dollars, and that there are also some parts of the country where silver circulates by the million of dollars.
Mr. Brooks, of New York. Like cotton and sugar.
Mr. Sargent. No, sir; but as coin. Upon the Pacific gold and silver are the regular circulating medium, and there is nothing except a mere artificial barrier between that portion of the country and all the rest on account of the circulation throughout the Pacific coast of gold and silver.
[Here the hammer fell.]
Mr. Potter rose.
The Speaker. No further amendment is in order, and debate on the pending amendment has been exhausted.
Mr. Brooks, of New York. I withdraw my amendment.
Mr. Potter. I renew it. Mr. Speaker, I am not unmindful of the specie produced in this country; but let me ask the gentleman from California whether he thinks specie payments can be restored by any device we ean impress upon the coin of the country at a time when the Government paper in circulation is worth but ninety cents on the dollar of its nominal value ? The gentleman says we can reduce the coinage charge. Now, how much is the coinage charge ?
Mr. Sargent. One half of one per cent.
Mr. Potter. Now, will the reduction of one half of one per cent. put gold in circulation when the paper currency is now nearly eleven per cent. below par ?
Mr. Sargent. It will keep it in the country, so as to be here for coinage purposes.
Mr. Potter. It will keep it in the country so as to be here for coinage purposes ! Why, it is here for coinage purposes now, and if it is not coined with the stamp of the Federal Government on it, it is because it cannot, after it is so stamped, be used for circulation in this country, but instead goes to countries where it can be used, countries which do use coin as their medium for circulation, and there gets the stamp of those countries upon it. No amount of legislation can make coin circulate for more than its intrinsic worth, except small coins for subsidiary purposes and within narrow limits; for if you stamp on the coin a false value, it will nevertheless circulate only at its true value.
If, however, there are any excessive charges on account of coinage, I say reduce them. But if the gold and silver go away to other countries, it is because they are wanted as a circulating medium when they get to those countries, while we do not so use them here. I will go hand in hand with any man who wishes the country to get back to specie payments. But there is only one way in which that can be done. It is to make a dollar of legal-tender paper redeemable by and so equal in actual value to a real dollar. No contrivance of putting stamps upon these coins, or of recoining the coin and putting on another stamp instead of the present one, will make the coin worth one cent more than the real intrinsic value it possesses; and all measures to give a false and arbitrary value to the coin of the country will prove here, as they have proved everywhere, a delusion. And if that is one of the purposes of this bill it is not a purpose which should commend it to our consideration.
Mr. Kelley. I wish to ask the gentleman who has just spoken [Mr. Potter] if he knows of any Government in the world which makes its subsidiary coinage of full value ? The silver coin of England is ten per cent. below the value of gold coin. And acting under the advice of the experts of this country, and of England and France, Japan has made her silver coinage within the last year twelve per cent. below the value of gold coin, and for this reason: it is impossible to retain the double standard. The values of gold and silver continually fluctuate. You cannot determine this year what will be the relative values of gold and silver next year. They were fifteen to one a short time ago; they are, sixteen to one now.
Hence all experience has shown that you must have one standard coin, which shall be a legal tender for all others, and then you may promote your domestic convenience by having a subsidiary coinage of silver, which shall circulate in all parts of your country as legal tender for a limited amount, and be redeemable at its face value by your Government.
But, sir, I again call the attention of the House to the fact that the gentlemen who oppose this bill insist upon maintaining a silver dollar worth three and a half cents more than the gold dollar, and worth seven cents more than two half dollars, and that, so long as those provisions remain, you cannot keep silver coin in the country. Certain silver bullion dealers of New York are making from fifty thousand to one hundred and fifty thousand dollars a year out of your Government. One of them admitted to my colleague on the committee and myself, that his business averaged from one million eight hundred thousand to two million dollars a year, and that he put the silver into the Mint, and drew out for every two dollars four half dollars and one ten-cent piece.
This bill, while it contains many other excellent provisions, will save to the people of the country at least from a quarter to a half million dollars in the next year, apart from the jobbing in hypothecated bars, and when we come to specie payments we will save, $5,000,000, which now go to the silver bullion dealers of New York.
[Here the hammer fell.]
The Speaker. Debate on the amendment is exhausted.
Mr. Potter. I desire to say just one word, I do not differ from the gentleman from Pennsylvania [Mr. Kelley] in regard to the section we are now talking about.
The motion to strike out the section was disagreed to.---[if all those future crocodile tear droppers really wanted to keep silver, they could have done so then and there. If Brooks, Potter, Wood knew what was in the bill, all those who later claimed that they did not know (Garfield, Kelley, Blaine, Voorhees) knew it, too; or they didn't care and didn't want to know]
The Clerk read the following section:
Sec. 2. That the Director of the Mint shall have the general supervision of all mints and assay offices, and shall make an annual report to the Secretary of the Treasury of their operations at the close of each fiscal year, and from time to time such additional reports setting forth the operations and condition of such institutions as the Secretary of the Treasury shall require, and shall lay before him the annual estimates for their support. And the Secretary of the Treasury shall appoint the number of clerks, classified according to law, necessary to discharge the duties of said bureau.
Mr. Brooks, of New York. I move to strike out this section for the purpose of replying briefly to the remarks of the two gentlemen from Pennsylvania, the one on my right [Mr. Kelley] and the other on my left, [Mr. Randall.] They think the gentlemen from New York are in opposition to this bill because they want the Mint there. We do not want any Mint there.
Mr. Randall. Why, sir, you have been struggling for twenty years to get the Mint away from Philadelphia.
Mr. Brooks, of New York. Mr. Speaker, Wall street and that part of New York is now in heaven, and always will be so long as rags are the currency of this Government. We make millions of dollars out of rags, and shall continue to make millions of dollars out of rags until Congress orders the resumption of specie payments. If anybody makes $100,000 a year out of bullion, as the gentleman from Pennsylvania [Mr. Kelley] asserts, there are others, paper-money men, bankers and brokers, the contrivers and architects of exchange of all sorts and kinds, who make thousands and tens of thousands and hundreds of thousands of dollars upon the existing state of things.
I make these remarks simply in reply to the insinuation that the opposition to this measure is hostility on the part of New York to Philadelphia. We have no such hostility whatever. We embrace Philadelphia as in close contiguity to us. Ours is all Olympian position, one from which, like the fabled Jupiter of old, we look down on all the surrounding communities, and with perfect confidence in our own power and position, with no envy of the little surrounding cities, or of the surrounding cities, be they little or great. [Laughter.]
I repeat, sir, I will take no further part than is necessary in this comic performance.
Mr. Randall. In reply to what has fallen from my distinguished friend from New York, I can only say that during the short time I have been in public life I have always admired the energy and have always gloried in the success of New York. I have always been ready to extend every help that would make her prosperous and happy, and I would make her the leading city, if I could, in the world. But, sir, I remember, when a boy, hearing of this feeling of New York against Philadelphia, and I thought of the meanness of such people engaged in building up a commercial city to be picking away at a neighbor who had always been her friend, those at least of liberal minds, like mine, as I hope it is --picking, picking at us to carry away our last vestige of Government Patronage.
As to the resumption of specie payments, I do not believe for an instant that it will be facilitated by this bill, nor do I believe that the bill will retard a return to specie payments. In my opinion specie payments are not resumed because the doctors disagree as to the medicine to be applied to the patient. I hope the doctors will agree after the presidential election shall have passed, and after a fear of the great national banking system shall have departed from the minds of the politicians of the country. Specie payments are not resumed, sir, because our national banks put in their mighty hand here and elsewhere and corrupt the minds of the people. They do not want to pay their notes, of course, as long as they can help it, and that is the reason why specie payments are not resumed. They are the practical opponents of the resumption of the specie payments.
Now, I will go with the gentleman from New York for a resumption of specie payments whenever he is ready; but the idea of his getting up here and describing as he does, our currency as rags, I tell him is beneath his intellect, beneath his position in this House. It is beneath his Americanism. Sir, our greenbacks are not rags.
I am in favor of this bill, after an examination of its provisions, because I believe the former Mint laws were confused, and I believe that this codification of the laws will make them plain and the execution simple. I neither partake in the nickel interest, which has been alluded to, nor in the interests of the constituent of the gentleman from New York [Mr. Potter] which have been referred to. And I believe that the objections expressed upon a former occasion against this bill have been remedied in every particular save one, and that is that it creates a single new office. I hope, therefore, that we shall not be led into a conflict between New York and Philadelphia.
[Here the hammer fell.]
The question was then taken upon the motion to strike out section two of the bill; and it was not agreed to.
The Clerk read the following:
Sec. 3. That the officers of each mint shall be a superintendent, an assayer, a melter and refiner, and a coiner, and for the Mint at Philadelphia an engraver, all to be appointed by the President of the United States, by and with the advice and consent of the Senate.
Sec. 4. That the superintendent of each mint shall have the control thereof, the superintendence of the officers and persons employed therein, and the supervision of the business thereof, subject to the approval of the Director of the Mint, to whom he shall make reports at such times and according to such forms as the Director of the Mint may prescribe, which shall exhibit in detail, and under appropriate heads, the deposits of bullion, the amount of gold, silver, and minor coinage, and the amount of unparted, standard, and refined bars issued, and such other statistics and information as may be required. The superintendent of each mint shall also receive and safely keep, until legally withdrawn, all moneys or bullion which shall be for the use or the expenses of the mint; he shall receive all bullion brought to the mint for assay or coinage; shall be the keeper of all bullion or coin in the mint except while the same is legally in the hands of other officers, and shall deliver all coins struck at the mint to the persons to whom they shall be legally payable. From the report of the assayer and the weight of the bullion, he shall compute the whole amount of each deposit, and also the amount of the charges or deductions, if any, of all which he shall give a detailed memorandum to the depositor; and he shall also give at the same time, under his hand, a certificate of the net amount of the deposit, to be paid in coins or bars of the same species of bullion as that deposited, the correctness of which certificate shall be verified by the assayer, who shall countersign the same; and in all cases of transfer of coin or bullion, he shall give and receive vouchers stating the amount and character of such coin or bullion. He shall keep and render, quarter-yearly, to the Director of the Mint, for the purpose of adjustment, according to such forms as may be prescribed by the Secretary of the Treasury, regular and faithful accounts of his transactions with the other officers of the Mint and the depositors; and shall also render to him a monthly statement of the ordinary expenses of the mint or assay office under his charge. He shall also appoint all assistants, clerks, (one of whom shall be designated "chief clerk,") and workmen employed under his superintendence; but no person shall be appointed to employment in the offices of the assayer, melter and refiner, coiner, or engraver, except on the recommendation and nomination in writing of those officers respectively; and he shall forthwith report to the Director of the Mint the names of all persons appointed by him, the duties to be performed, the rate of compensation, the appropriation from which compensation is to be made, and the grounds of the appointment; and if the Director of the Mint shall disapprove of the same, the appointment shall be vacated.
Mr. Lynch. I move that the House now adjourn.
Mr. Hooper, of Massachusetts. I hope not. Let us go on a little longer with this bill.
Mr. Lynch. I will withdraw the motion.
The Clerk read the following:
Sec. 5. That the assayer shall assay all metals and bullion, whenever such assays are required in the operations of the Mint; he shall also make assays of coins whenever required by the superintendent.
Sec. 6. That the melter and refiner shall execute all the operations which are necessary in order to form ingots of standard silver or gold, and alloys for minor coinage, suitable for the coiner, from the metals legally delivered to him for that purpose, and shall also execute all the operations which are necessary in order to form bars conformable in all respects to the law, from the gold and sliver bullion delivered to him for that purpose. He shall keep a careful record of all transactions with the superintendent, noting the weight and character of the bullion; and shall be responsible for all bullion delivered to him, until the same is returned to the superintendent and the proper vouchers obtained.
Sec. 7. That the coiner shall execute all the operations which are necessary in order to form coins, conformable in all respects to the law, from the standard gold and silver ingots and alloys for minor coinage, legally delivered to him for that purpose; and shall be responsible for all bullion delivered to him until the same is returned to the superintendent and the proper vouchers obtained.
Mr. Speer, of Georgia. I move that the House now adjourn.
The motion was agreed to; and accordingly (at four o'clock and twenty minutes p.m.) the House adjourned.
Mints and Coinage.
Mr. Hooper, of Massachusetts. I desire to call up the bill (H.R. No. 1427) revising and amending the laws relative to mints, assay offices, and coinage of the United States. I do so for the purpose of offering an amendment to the bill in the nature of a substitute, one which has been very carefully prepared and which I have submitted to the different gentlemen in this House who have taken a special interest in the bill. I find that it meets with universal approbation in the form in which I offer it. I move that the rules be suspended, and that the substitute ---[which is H.R. 2934] be put on its passage.
Mr. Brooks. I ask the gentleman from Massachusetts [Mr. Hooper] to postpone his motion until his colleague on the committee, my colleague from New York, [Mr. Potter] is in his seat. It is my impression that he does not concur in this substitute.
Mr. Hooper, of Massachusetts. It is so late in the session that I must decline waiting any longer.
Mr. Brooks. I would again suggest to the gentleman that he sbould wait until my colleague comes in.
Mr. Hooper, of Massachusetts. I cannot do so.
Mr. Holman. I suppose it is intended to have the bill read before it is put upon its passage.
The Speaker. The substitute will be read.
Mr. Hooper, of Massachusetts. I hope not. It is a long bill, and those who are interested in it are perfectly familiar with its provisions.
Mr. Kerr. The rules cannot be suspended so as to dispense with the reading of the bill ?
The Speaker. They can be.
Mr. Kerr. I want the House to understand that it is attempted to put through this bill without being read.
The Speaker. Does the gentleman from Massachusetts [Mr. Hooper] move that the reading of the bill be dispensed with ?
Mr. Hooper, of Massachusetts. I will so frame my motion to suspend the rules that it will dispense with the reading of the bill.
The Speaker. The gentleman from Massachusetts moves that the rules be suspended and that the bill pass, the reading thereof being dispensed with.
Mr. Randall. Cannot we have a division of that motion ?
The Speaker. A motion to suspend the rules cannot be divided.
Mr. Randall. I should like to have the bill read, although I am willing that the rules shall be suspended as to the passage of the bill.
The question was put on suspending the rules and passing the bill without reading; and (two thirds not voting in favor thereof) the rules were not suspended.
Mr. Hooper, of Massachusetts. I now move that the rules be suspended, and the substitute for the bill in relation to mints and coinage passed; and I ask that the substitute be read.
The Clerk began to read the substitute.
Mr. Brooks. Is that the original bill ?---[Which side is he on ?]
The Speaker. The motion of the gentleman from Massachusetts, [Mr. Hooper] applies to the substitute, and that on which the House is called to act is being read.
Mr. Brooks. As there is to be no debate, the only chance we have to know what we are doing is to have both the bill and the substitute read.---[once again, which side are you on ? pay attention to what is read, then vote against it; you were there on April 9, huffed and puffed and claimed to know what was in the bill]
The Speaker. The motion of the gentleman from Massachusetts being to suspend the rules and pass the substitute, it gives no choice between the two bills. The House must either pass the substitute or none.
Mr. Brooks. How can we choose between the original bill and the substitute unless we hear them both read ?
The Speaker. The gentleman can vote "ay" or "no" on the question whether this substitute shall be passed.
Mr. Brooks. I am very much in the habit of voting "no" when I do not know what is going on.
Mr. Holman. Before the question is taken upon suspending the rules and passing the bill I hope the gentleman from Massachusetts will explain the leading changes made by this bill in the existing law, especially in reference to the coinage. It would seem that all the small coinage of the country is intended to be recoined.
Mr. Hooper, of Massachusetts. This bill makes no changes in the existing law in that regard. It does not require the recoinage of the small coins. On the contrary, I understand that the Secretary of the Treasury proposes to issue an order to stop the coinage of all the minor coins, as there is now a great abundance of them in the country. The salaries are not increased. They remain as they were.
Mr. Holman. Is not the salary of the sub-Treasurer at New York increased ?
Mr. Hooper, of Massachusetts. No, sir; it is not increased.
Mr. Garfield, of Ohio. Does the gentleman say that no salary is increased by this bill ?
Mr. Hooper, of Massachusetts. No salary is increased by this bill.
Mr. Farnsworth. Are there any additional offices created ?
Mr. Sargent. The bill dispenses with some existing offices.
Mr. Hooper, of Massachusetts. It dispenses with certain officers now in the mints, and the saving on their salaries will more than pay for the expenses of the new bureau of the Treasury Department.
Mr. Holman. What is the new bureau called ?
Mr. Hooper, of Massachusetts. The new bureau is to be called the bureau of mines and coinage. There is now no general superintendence; each mint runs on its own hook. There is really now no law regulating the mints, and no responsibility.
Mr. Holman. How many mints are provided for by the bill ?
Mr. Hooper, of Massachusetts. No new mints.
Mr. Holman. Did the Committee on Banking and Currency consider the subject of discontinuing any of the mints ?
Mr. Hooper, of Massachusetts. They did consider it, and did not deem it expedient. The Secretary of the Treasury has authority now, independent of this bill, to discontinue certain mints if he deems it expedient; one at Charlotte, for instance. This bill does not change his power at all in that respect.
Mr. Merriam. Has this bill been submitted to the Secretary of the Treasury; and if so, does it meet his approval ?
Mr. Hooper, of Massachusetts. It has been submitted to him, and he not only approves it but strongly urges its passage. He deems it exceedingly important, as there are irregularities in the Mint now, which cannot be controlled by any existing law.
Mr. Kerr. Does the nickel clause, so called, and which led to some controversy a month or so ago, remain in the bill as it was at that time ?
Mr. Hooper, of Massachusetts. It has been changed. Any nickel to be purchased is to be subject to bids after advertisement.
Mr. Brooks. My colleague from the Westchester district [Mr. Potter] stated the other day that this bill provided for the recoinage of more or less of the small currency of the country and the creation of a new currency.
Mr. Hooper, of Massachusetts. That is not the case with the bill as it now stands.
Mr. McCormick, of Missouri. I ask that the nineteenth section be again read.
The section was read as follows:
Sec. 19. That upon the coins of the United States there shall be the following devices and legends: upon one side there shall be an impression emblematic of liberty, with an inscription of the word "liberty," and the year of the coinage; and upon the reverse shall be the figure or representation of an eagle, with the inscriptions "United States of America" and "E Pluribus Unum," and a designation of the value of the coin; but on the gold dollar and three-dollar piece, the dime, five, three, and one cent piece, the figure of the eagle shall be omitted; and the Director of the Mint, with the approval of the Secretary of the Treasury, may cause the motto "In God we trust" to be inscribed upon such coins as shall admit of such motto; and any one of the foregoing inscriptions may be on the rim of the gold and silver coins.
Mr. McCormick, of Missouri. What I wish to inquire of the gentleman from Massachusetts, [Mr. Hooper] is whether, under the provisions of the nineteenth section, the Director of the Mint is not authorized to recoin all the nickel coin of the United States in order to make it conform to this section ?---[McCormick suspects that the purpose of this bill is to benefit Kelley's nickel friends in Pennsylvania and wants to make sure that they will not get this pie to themselves. If others had paid attention, if others had asked for the reading of section 14]
Mr. Hooper, of Massachusetts. He is not. On the contrary, under the existing laws, as I stated before, the amount of minor coinage is so large that the Secretary of the Treasury has prepared an order prohibiting any further coinage until further notice.
Mr. McCormick, of Missouri. I understand that the Director of the Mint says that it costs the Government almost as much to coin a five-cent nickel piece as it does to coin a ten-dollar gold piece.
Mr. Hooper, of Massachusetts. There is nothing in this bill to compel a recoinage.
Mr. McCormick, of Missouri. Would the gentleman have any objection to strike out that section ?
Mr. Hooper, of Massachusetts. Certainly I would.
Mr. Garfield, of Ohio. Does this bill provide what shall be done with those officers of the Treasury that are now called Assistant Treasurers, and who are ex officio officers of the Mint ? By this bill they are evidently separated from the Treasury, and belong wholly, to this new bureau which is to be established. Now, will it not be necessary for us to establish new offices in their cases, and to give them a salary appropriate to the duties they will have to perform in the Treasury ?---[He was there, and was awake, and paid attention; but only to salaries, not to section 14]
Mr. Hooper, of Massachusetts. The Superintendent of the Mint (and that officer now exists) takes the place of the sub-treasurer, who acted ex officio as an officer of the Mint, and provision is made in this bill that the sub-Treasurer, who acted ex officio, shall go back and confine himself to his duties as Assistant Treasurer, and disconnect himself from the Mint.
Mr. Garfield, of Ohio. Go back to the Treasury ?
Mr. Hooper, of Massachusetts. Yes.
Mr. Garfield, of Ohio. The gentleman will then see that that entails upon us the necessity of providing a sufficient salary for those going back to the Treasury.
Mr. Hooper, of Massachusetts. I beg the gentleman's pardon; it leaves the Superintendent of the Mint with the same salary as before.
Mr. Garfield, of Ohio. I mean that the officers who go back into the Treasury must have salaries provided for them.
Mr. Hooper, of Massachusetts. They were ex officio officers of the Mint; their salaries were not increased.
Mr. Garfield, of Ohio. I beg the gentleman's pardon; they had one salary as ex officio officers of the Mint and another as officers of the Treasury.
Mr. Sargent. That was not so except in one instance.
Mr. McNeely. As a member of the Committee on Coinage, Weights, and Measures, having carefully examined every section and line of this bill, and generally well understanding the subject before us, I am satisfied the bill ought to pass.
Mr. Sargent. I hope we will now have a vote.
The question being taken on the motion of Mr. Hooper, of Massachusetts, to suspend the rules and pass the bill, it was agreed to; there being-- ayes 110, noes 13.
H.R. 2934. as it passed the House
Revising and amending the laws relative to the mints, assay-offices, and coinage of the United States.
Be it enacted by the Senate of House of Representatives of the United States of America in Congress assembled,
That the Mint of the United States is hereby established as a Bureau of the Treasury Department, embracing in its organization and under its control all mints for the manufacture of coin, and all assay-offices for the stamping of bars, which are now, or which may be hereafter, authorized by law. The chief officer of the said Bureau shall be denominated the Director of the Mint, and shall be under the general direction of the Secretary of the Treasury. He shall be appointed by the President, by and with the advice and consent of the Senate, and shall hold his office for the term of five years, unless sooner removed by the President, upon reasons to be communicated by him to the Senate.
Sec. 13. That the standard for both gold and silver coins of the United States shall be such that of one thousand parts by weight nine hundred shall be of pure metal and one hundred of alloy; and the alloy of the silver coins shall be of copper, and the alloy of the gold coins shall be of copper, or of copper and silver; but the silver shall in no case exceed one-tenth of the whole alloy.
Sec. 14. That the gold coins of the United States shall be a one-dollar piece, which at the standard weight of twenty-five and eight-tenth grains shall be the unit of value; a quarter-eagle, or two-and-a-half-dollar piece; a three-dollar piece; a half-eagle, or five-dollar piece; an eagle, or ten-dollar piece; and a double-eagle, or twenty-dollar piece. And the standard weight of the gold dollar shall be twenty-five and eight-tenths grains; of the quarter-eagle, or two-and-a-half-dollar piece, sixty-four and a half grains; of the three-dollar piece, sixty-four and a half grains; of the three-dollar piece, seventy-seven and four-tenths grains; of the half-eagle, or five-dollar piece, one hundred and twenty-nine grains; of the eagle, or ten-dollar piece, two hundred and fifty-eight grains; of the double-eagle, or twenty-dollar piece, five hundred and sixteen grains; which coins shall be a legal tender in all payments at their nominal value when not below the standard weight and limit of tolerance provided in this act for the single piece; and, when reduced in weight below said standard and tolerance, shall be a legal tender at valuation in proportion to their actual weight; and any gold coin of the United States, if reduced in weight by abrasion not more than one-half of one per centum on the double eagle and eagle, and one per centum on the other coins below the standard weight prescribed by law, shall be received at their nominal value by the United States Treasury and its offices, under such regulations as the Secretary of the Treasury may prescribe for the protection of the Government against fraudulent abrasion or other practices; and any gold coins in the Treasury of the United States reduced in weight below this limit of abrasion shall be recoined.
Sec. 15. That any gold coin now in circulation the weight of which is below the limit of abrasion prescribed in this act may be received at the mints in Philadelphia and San Francisco at par in exchange for silver coins: Provided, That the circulation of such gold coin, as shown by the date of coinage, has been sufficient to produce such loss by natural abrasion; and the coins so received shall be recoined; but no gold coins which appear to have been artificially reduced shall come within the provisions of this section.
Sec. 16. That the silver coins of the United States shall be a dollar, half-dollar or fifty-cent piece, a quarter-dollar or twenty five cent piece, and a dime or ten-cent piece; and the weight of the dollar shall be three hundred and eighty-four grains; the half-dollar, quarter-dollar and the dime shall be, respectively, one-half, one-quarter, and one-tenth of the weight of said dollar; which coins shall be a legal tender, at their nominal value, for any amount not exceeding five dollars in any one payment.
Sec. 17. That the minor coins of the United States shall be a five-cent piece, a three-cent piece, and a one-cent piece; and the alloy for minor coinage shall be of copper and nickel, to be composed of three-fourths copper and one-fourth nickel; the weight of the piece of five cents shall be five grams, or seventy-seven and sixteen-hundredths grains troy; of the three-cent piece, three grams, or forty-six and thirty-hundredths grains; and of the one-cent piece, one and one-half grams, or twenty-three and fifteen-hundredths grains; which coins shall be a legal tender, at their nominal value, for any amount not exceeding twenty-five cents in any one payment.
Sec. 18. That no coins, either of gold, silver, or minor coinage, shall hereafter be issued from the Mint other than those of the denominations, standards, and weights herein set forth.
Sec. 19. That upon the coins of the United States there shall be the following devices and legends: Upon one side there shall be an impression emblematic of liberty, with an inscription of the word "Liberty" and the year of the coinage, and upon the reverse shall be the figure or representation of an eagle, with the inscriptions "United States of America" and "E Pluribus Unum," and a designation of the value of the coin; but on the gold dollar and three-dollar piece, the dime, five, three, and one cent piece the figure of the eagle shall be omitted; and the Director of the Mint, with the approval of the Secretary of the Treasury, may cause the motto "In God we trust" to be inscribed upon such coins as shall admit of such motto; and any one of the foregoing inscriptions may be on the rim of the gold and silver coins.
Sec. 22. That any owner of silver bullion may deposit the same at any mint, to be formed into bars for his benefit; no deposit for coinage into silver coin shall be received; but silver bullion contained in gold deposits, and separated therefrom, may be paid for in silver coin, at such valuation as may be, from time to time, established by the Director of the Mint.
Sec. 26. That the charge for converting standard gold bullion into coin shall be one-fifth of one per centum; and the charges for refining when the bullion is below standard, for toughening when metals are contained in it which render it unfit for coinage, for copper used for alloy when the bullion is above standard, for separating the gold and silver when these metals exist together in the bullion, and for the preparation of bars, shall be fixed, from time to time, by the Director, with the concurrence of the Secretary of the Treasury, so as to equal but not exceed, in their judgment, the actual average cost to each mint and assay-office of the material, labor, wastage, and use of machinery employed in each of the cases aforementioned.
Sec. 30. That for the purchase of metal for the minor coinage authorized by this act, a sum not exceeding fifty thousand dollars in lawful money of the United States shall be transferred by the Secretary of the Treasury to the credit of the superintendent of the mint at Philadelphia, at which establishment only, until otherwise provided by law, such coinage shall be carried on. The superintendent, with the approval of the Director of the Mint as to price, terms, and quantity, shall purchase the metal required for such coinage by public advertisement, and the lowest and best bid shall be accepted, the fineness of the metals to be determined on the mint assay. The gain arising from the coinage of such metals into coin of a nominal value, exceeding the cost thereof, shall be credited to the special fund denominated the minor-coinage profit fund; and this fund shall be charged with the wastage incurred in such coinage, and with the cost of distributing said coins as hereinafter provided. The balance remaining to the credit of this fund, and any balance of profits accrued from minor coinage under former acts, shall be, from time to time, and at least twice a year, covered into the Treasury of the United States.
Sec. 68. That this act shall be known as the "Coinage act of 1872;" and all other acts and parts of acts pertaining to the mints, assay offices, and coinage of the United States, inconsistent with the provisions of this act, are hereby repealed: Provided, That this act shall not be construed to affect any act done, right accrued, or penalty incurred, under former acts, but every such right is hereby saved; and all suits and prosecutions for acts already done in violation of any former act or acts of Congress relating to the subjects embraced in this act may be begun or proceeded with in like manner as if this act had not been passed; and all penal clauses and provisions in existing laws relating to the subjects embraced in this act shall be deemed applicable thereto: And provided further, That so much of the first section of "An act making appropriations for sundry civil expenses of the Government for the year ending June 30, eighteen hundred and seventy-one, and for other purposes," approved July 15, 1870, as provides that until after the completion and occupation of the branch mint building in San Francisco, it shall be lawful to exchange, at any mint or branch mint of the United States, unrefined or unparted bullion whenever, in the opinion of the Secretary of the Treasury, it can be done with advantage to the Government, is hereby repealed.
Passed the House of Representatives, May 27, 1872.
Attest: Edward McPherson, Clerk.
Alabama 1. Benjamin S. Turner (R) 2. Charles W. Buckley (R) 3. William A. Handley (D) 4. Charles Hays (R) 5. Peter M. Dox (D) 6. Joseph H. Sloss (D) Arkansas 1. James M. Hanks (D) 2. Oliver P. Snyder (R) 3. Thomas Boles (R) California 1. Sherman O. Houghton (R) 2. Aaron A. Sargent (R) railroad representative 3. John M. Coghlan (R) Connecticut 1. Julius L. Strong (R) 2. Stephen W. Kellogg (R) 3. Henry H. Starkweather (R) 4. William H. Barnum (D) Georgia 1. Archibald T. MacIntyre (D) 2. Richard H. Whiteley (R) 3. John S. Bigby (R) 4. Thomas J. Speer (R) 5. Dudley M. Du Bose (D) 6. William P. Price (D) 7. Pierce M.B. Young (D) Illinois 1. Charles B. Farwell (R) 2. John F. Farnsworth (R) 3. Horatio C. Burchard (R) claimed he did not know 4. John B. Hawley (R) 5. Bradford N. Stevens (D) 6. Henry Snapp (R) 7. Jesse H. Moore (R) 8. James C. Robinson (D) 9. Thompson W. McNeely (D) 10. Edward Y. Rice (D) 11. Samuel S. Marshall (D) 12. John B. Hay (R) 13. John M. Crebs (D) Indiana 1. William E. Niblack (D) 2. Michael C. Kerr (D) 3. William S. Holman (D) claimed he did not know 4. Jeremiah M. Wilson (R) 5. John Coburn (R) 6. Daniel W. Voorhees (D) claimed he did not know 7. Mahlon D. Manson (D) 8. James N. Tyner (R) 9. John P.C. Shanks (R) 10. William Williams (R) 11. Jasper Packard (R) Iowa 1. George W. McCrary (R) 2. Aylett R. Cotton (R) 3. William G. Donnan (R) 4. Madison M. Walden (R) 5. Francis W. Palmer (R) 6. Jackson Orr (R) Kentucky 1. Edward Crossland (D) 2. Henry D. McHenry (D) 3. Joseph H. Lewis (D) 4. William B. Read (D) 5. Boyd Winchester (D) 6. William E. Arthur (D) 7. James B. Beck (D) 8. George M. Adams (D) 9. John M. Rice (D) Louisiana 1. J. Hale Sypher (R) 2. Lionel A. Sheldon (R) 3. Chester B. Darrall (R) 5. Frank Morey (R) Maine 1. John Lynch (R) 2. William P. Frye (R) 3. James G. Blaine (R) 4. John A. Peters (R) 5. Eugene Hale (R) Maryland 1. Samuel Hambleton (D) 2. Stevenson Archer (D) 3. Thomas Swann (D) 4. John Ritchie (D) 5. William M. Merrick (D) Massachusetts 1. James Buffington (R) 2. Oakes Ames (R) 3. Ginery Twichell (R) 4. Samuel Hooper (R) 5. Benjamin F. Butler (R) hero of greenbackers 6. Nathaniel P. Banks (R) 7. George M. Brooks (R) 8. George F. Hoar (R) 9. Alvah Crocker (R) 10. Henry L. Dawes (R) Michigan 1. Henry Waldron (R) 2. William L. Stoughton (R) 3. Austin Blair (R) 4. Wilder D. Foster (R) 5. Omar D. Conger (R) 6. Jabez G. Sutherland (D) Minnesota 1. Mark H. Dunnell (R) 2. John T. Averill (R) Mississippi 1. George E. Harris (R) 2. Joseph L. Morphis (R) 3. Henry W. Barry (R) 4. George C. McKee (R) 5. Legrand W. Perce (R) Missouri 1. Erastus Wells (D) 2. Gustavus A. Finkelnburg (LR) 3. James R. McCormick (D) 4. Harrison E. Havens (R) 5. Samuel S. Burdett (R) 6. Abram Comingo (D) 7. Isaac C. Parker (R) 8. James G. Blair (LR) 9. Andrew King (D) Nebraska At-large. John Taffe (R) Nevada At-large. Charles W. Kendall (D) New Hampshire 1. Ellery A. Hibbard (D) 2. Samuel N. Bell (D) 3. Hosea W. Parker (D) New Jersey 1. John W. Hazelton (R) 2. Samuel C. Forker (D) 3. John T. Bird (D) 4. John Hill (R) 5. George A. Halsey (R) New York 1. Dwight Townsend (D) 2. Thomas Kinsella (D) 3. Henry W. Slocum (D) 4. Robert Roosevelt (D) 5. William R. Roberts (D) 6. Samuel S. Cox (D) hard money man 7. Smith Ely, Jr. (D) 8. James Brooks (D) 9. Fernando Wood (D) copperhead 10. Clarkson N. Potter (D) 11. Charles St. John (R) 12. John H. Ketcham (R) 13. Joseph H. Tuthill (D) 14. Eli Perry (D) 15. Joseph M. Warren (D) 16. John Rogers (D) 17. William A. Wheeler (R) 18. John M. Carroll (D) 19. Elizur H. Prindle (R) 20. Clinton L. Merriam (R) 21. Ellis H. Roberts (R) 22. William E. Lansing (R) 23. R. Holland Duell (R) 24. John E. Seeley (R) 25. William H. Lamport (R) 26. Milo Goodrich (R) 27. H. Boardman Smith (R) 28. Freeman Clarke (R) 29. Seth Wakeman (R) 30. William Williams (D) 31. Walter L. Sessions (R) North Carolina 1. Clinton L. Cobb (R) 2. Charles R. Thomas (R) 3. Alfred M. Waddell (D) 4. Sion H. Rogers (D) 5. James M. Leach (D) 6. Francis E. Shober (D) 7. James C. Harper (D) Ohio 1. Aaron F. Perry (R) 2. Job E. Stevenson (R) 3. Lewis D. Campbell (D) 4. John F. McKinney (D) 5. Charles N. Lamison (D) 6. John A. Smith (R) 7. Samuel Shellabarger (R) 8. John Beatty (R) 9. Charles Foster (R) 10. Erasmus D. Peck (R) 11. John T. Wilson (R) 12. Philadelph Van Trump (D) 13. George W. Morgan (D) 14. James Monroe (R) 15. William P. Sprague (R) 16. John Bingham (R) of 14th amendment fame, greenback supporter 17. Jacob A. Ambler (R) 18. William H. Upson (R) 19. James A. Garfield (R) hard money man Pennsylvania 1. Samuel J. Randall (D) hard money man 2. John V. Creely (IR) 3. Leonard Myers (R) 4. William D. Kelley (R) claimed he did not know 5. Alfred C. Harmer (R) 6. Ephraim L. Acker (D) 7. Washington Townsend (R) 8. J. Lawrence Getz (D) 9. Oliver J. Dickey (R) 10. John W. Killinger (R) 11. John B. Storm (D) 12. Lazarus D. Shoemaker (R) 13. Ulysses Mercur (R) 14. John B. Packer (R) 15. Richard J. Haldeman (D) 16. Benjamin F. Meyers (D) 17. R. Milton Speer (D) 18. Henry Sherwood (D) 19. Glenni W. Scofield (R) hero of greenbackers 20. Samuel Griffith (D) 21. Henry D. Foster (D) 22. James S. Negley (R) 23. Ebenezer McJunkin (R) 24. William McClelland (D) Rhode Island 1. Benjamin T. Eames (R) 2. James M. Pendleton (R) South Carolina 1. Joseph Rainey (R) 2. Robert C. De Large (R) 3. Robert B. Elliott (R) 4. Alexander S. Wallace (R) Tennessee 1. Roderick R. Butler (R) 2. Horace Maynard (R) 3. Abraham E. Garrett (D) 4. John M. Bright (D) 5. Edward I. Golladay (D) 6. Washington C. Whitthorne (D) 7. Robert P. Caldwell (D) 8. William W. Vaughan (D) Texas 1. William S. Herndon (D) 2. John C. Conner (D) 3. William T. Clark (R) 4. John Hancock (D) Vermont 1. Charles W. Willard (R) 2. Luke P. Poland (R) 3. Worthington C. Smith (R) Virginia 1. John Critcher (D) 2. James H. Platt, Jr. (R) 3. Charles H. Porter (R) 4. William H.H. Stowell (R) 5. Richard T.W. Duke (D) 6. John T. Harris (D) 7. Elliott M. Braxton (D) 8. William Terry (D) West Virginia 1. John J. Davis (D) 2. James C. McGrew (R) 3. Frank Hereford (D) Wisconsin 1. Alexander Mitchell (D) 2. Gerry W. Hazelton (R) 3. J. Allen Barber (R) 4. Charles A. Eldredge (D) 5. Philetus Sawyer (R) 6. Jeremiah M. Rusk (R)