When you think of a dollar, you probably picture a green piece of paper with the picture of George Washington on it. The dollar bill is the most basic unit of paper currency in the U.S. But did you know that the first dollars in our country were not the banknote slips we have today, but instead silver coins?
Keep reading to learn more about the important role the silver dollar coin played in our nation’s history.
Pre-Colonial Currency
Before the American Revolutionary War, when the United States was nothing more than a handful of settlements and colonies scattered across the eastern seaboard, coins from various European nations were circulated around and often used to buy goods. The most common and popular of these was the Spanish silver dollar coin. The word “dollar” comes from the German word “thaler,” which was a German coin.
The Spanish “thaler” was the basis of the U.S. silver dollar coin. In 1776, the Continental Congress passed a motion to start producing a silver coin that could help support the weakened Continental – our young nation’s first attempt at creating a paper currency. However, in part due to the costs of the ongoing war, the Continental Dollar couldn’t be saved, resulting in the failure of America’s first fiat money. It was at this time that Thomas Jefferson, one of the Founding Fathers, remarked that he favored getting rid of paper currency altogether and minting coins of a similar value instead.
In a letter to Edward Carrington, an American soldier and statesman from Virginia, Jefferson wrote: “Paper is poverty… it is only the ghost of money, and not money itself.” In another letter, he said: “Specie [gold and silver coin] is the most perfect medium because it will preserve its own level; because, having intrinsic and universal value, it can never die in our hands, and it is the surest resource of reliance in time of war.”
An American Coinage Tradition
After the war for independence, the Coinage Act of 1792 was passed by Congress and the U.S. Mint began producing silver dollar coins consistently until 1803. Some of these original U.S. silver coins are still around today—though exceptionally rare—and are highly valued by collectors. In fact, the 1804 silver dollar (also called the Bowed Liberty Dollar) is one of the rarest and most famous coins of all time. Only 15 genuine 1804 silver coins are known to exist in the world.
It wasn’t till 1836 that the U.S. Mint began reproducing silver dollar coins regularly once again. Many of the coins minted after this time are still popular among collectors and investors today, including:
- The Morgan Dollar (1878–1904; 1921) – named after it’s designer, George T. Morgan, and second in collector popularity only to the Lincoln Cent
- The Peace Dollar (1921–1935; 1964) – circulated to commemorate the peace treaty that ended World War I
- GSA Dollars – an excess inventory of silver coins that were sold by the General Services Administration (GSA) from 1973-1974 and placed in special hard plastic holders
- The Eisenhower Dollar (1971–1978) – depicting Dwight D. Eisenhower, 34th President of the United States, on the obverse side, and on the reverse the insignia of the Apollo 11 moon landing
- The American Silver Eagle (1986 – Present) – the official silver bullion coin of the United States
Modern Silver Coins
Interestingly, despite their silvery color, many of the modern-day silver dollar coins actually have very little silver in them, if any. They are primarily composed of a copper-nickel combo – the same elements used to make the dime, quarter and half-dollar.
Older silver dollar coins, however, are comprised of anywhere from 0.77 to .999 pure silver. The current silver price (as of August 2014) puts the melt down value of a silver American Eagle coin at right around $22. In other words, these dollar coins aren’t for spending!
Are you ready to start your coin collection? Start by collecting your favorite Presidents of the United States with the Presidential $1 Coin series.
Also, be sure to play the U.S. Mint’s Dollar Dive game and help Plinky the Pig dive for dollar coins.
Sources:
http://www.usmint.gov/kids/coinnews/circulating/dollarCoin.cfm
http://en.wikipedia.org/wiki/Dollar_coin_(United_States)
Photo credit: An American Eagle Silver coin, courtesy of Provident Metals.