Communicated to the House of Representatives, April 25, 1816.
Mr. Root, from the committee on the subject of the copper and small silver coin of the United States, reported:
That, shortly after their appointment, the letter, marked A, was addressed to the Secretary of the Treasury, to which he returned an answer, marked B, enclosing copies of two letters, marked C and D, from the Director of the Mint.
The Secretary and Director, and a majority of the committee, being of the opinion that it is inexpedient to reduce the weight of the copper coin, or to reduce the weight or fineness of the small silver coin, they submit the following resolution:
Resolved, That it is inexpedient to reduce the weight or fineness of the copper and small silver coins of the United States.
Committee Room, January 24, 1816.
The select committee on sundry resolutions in relation to the copper coinage of the United States have directed me to request of you information on the following points, viz:
You are also requested to furnish the committee with any other information upon the subject which you may deem calculated to lead to a beneficial result.
I have the honor to be, sir, your obedient servant,
The Hon. A.J. Dallas, Secretary of the Treasury.
Treasury Department, February 10, 1816.
Sir:The attention required for some very urgent public business has prevented an early reply to the letter with which you honored me on the 24th ultimo, relative to the copper coinage of the United States. In order, however, to obtain the best practical information upon the subjects of your inquiry, the Director of the Mint has been consulted, and copies of his communications, dated, respectively, the 30th of January last, and the 1st instant, are now respectfully transmitted.
As I concur in the general opinions which Mr. Patterson has expressed, relative to the copper coinage of the United States, I abstain from troubling you with a more particular discussion upon that subject. It may be proper, however, to add, that a change in the current coin of a nation is always an operation of great delicacy; and, in the present state of our circulating medium, it might be peculiarly injurious. The speedy restoration of the current coin to its proper agency in the circulation appears to be an object generally desired; and how far a change in the weight and fineness of our coins, (particularly of the silver coins,) at this crisis, is likely to embarrass the attainment of that object, is a point respectfully suggested for your consideration.
I have the honor to be, very respectfully, sir, your most obedient servant,
The Hon. Erastus Root.
Mint of the United States, January 30, 1816.
I have received your favor of the 25th enclosing a copy of inquiries made by a committee of the House of Representatives, relative to the copper coinage, and shall, agreeably to your desire, give you all the information in my power on that subject.
Question 1. What is the present price of copper suitable for coinage?
Answer. The last importation of five tons of copper-cent planchets, including all charges, amounts to thirty-three and a half cents per pound avoirdupois, which, at the present standard weight of seven pennyweights (authorized by a proclamation of the President, published the 26th of January, 1796) containing forty-one and two-third cents, yields a clear profit on the coinage of twenty-four and two-fifths per cent. Our next importation of twenty-five tons, which has been ordered, and is expected in the course of the ensuing summer, will probably be at the same rate, if not lower.
Question 2. What was the highest price during the war?
Answer. No importation of copper was made by the Mint during that period. A few months previous to the declaration of war, twenty tons of copper-cent planchets were imported, which, including all charges, and taking into the account the rate of exchange at which bills had been purchased for the payment thereof, stood the Government in thirty-four cents per pound avoirdupois. Sheet copper in this city, during the war, from the increasing scarcity and demand, rose at one time to about seventy cents per pound: but even then, copper clippings (of equal use to manufacturers with copper coins) were to be purchased at twenty-five or thirty cents per pound. Nor have the officers of the Mint been able to ascertain that any considerable quantity of our copper coins have ever been melted down, at least in this city, and most probably very little any where else.
Question 3. Is there any inconvenience or fraud to be apprehended from the restriction of the weight of the copper coins; and, if not, to what extent may it safely be reduced?
Answer. In case of a reduction of the weight of copper coins a considerable inconvenience must certainly be experienced from those of the present standard already in the country and now in coinage; and this could not well be done except by reducing the present weight one-half. Besides, if the profit on copper coinage was much greater than at present, counterfeiters would undoubtedly set to work, as they have done heretofore, and thus keep the profit of this part of our coinage in their own hands.
Question 4. In case of the reduction in its weight would it be advisable to make it a legal tender to a small limited amount, and to provide against illegal impressions and importations?
Answer. Unless the nominal value of copper coins should be raised very considerably above the current price of copper in commerce, or that the quantity of copper coins should become too great for the convenience of small change, I can conceive no advantage in making it a legal tender, as it would readily be received without coercion. Provision should undoubtedly be made against illegal impressions and importations.
Question 5. In the event of the weight being reduced one-half, how many tons of copper coin can be coined at the Mint upon its present establishment in one year; and whether, in that event, it would not be advisable to coin two-cent pieces, and even four-cent pieces, and discontinue the coinage of half-cents?
Answer. In this event it would undoubtedly be advisable to coin both cent and two-cent pieces, corresponding to the half cents and cents now in circulation, but neither half-cent nor four-cent pieces; and in this case the numher of pieces which could be coined at the Mint in one year would be nearly equal to the number of cent planchets in fifty tons.
Question 6. Would the Mint experience any inconvenience from the reduction to any equal number of pennyweights, say four for instance, or would its present arrangements require a different reduction?
Answer. So far as respects the Mint merely, no very great inconvenience would be experienced from the reduction of the coins to any weight that might be thought proper. In this case, however, a very great inconvenience would arise from the copper coins already in circulation.
I have the honor, &c.
From a proposal this day made to me at the Mint, I have reason to believe that a constant supply of copper planchets can be had on much lower terms than any heretofore procured. Hence, sir, I cannot help thinking that any reduction in the present weight of our copper coinage would be attended with very great inconvenience, if not injustice.
The Hon. A.J. Dallas, Secretary of the Treasury.
Mint of the United States, February 1, 1816.
William Harrold, of the house of Harrold and Beller, Birmingham, has made a proposal to me to furnish the Mint with copper planchets fit for coinage, on terms considerably lower than any on which we have heretofore been supplied. At present, he wishes to limit his contract to five tons, to be shipped at Liverpool some time in the ensuing summer, or early in the fall. His terms are fifteen pence sterling per pound avoirdupois, to be paid in Philadelphia thirty days after arrival, at the then current rate of exchange. Insurance, freight, and other incidental charges, to be also paid by the Mint.
This contract will yield a profit on coinage of about ten per cent. more than the average of former contracts, and may be safely estimated at from thirty to thirty-five per cent. the weight remaining as at present.
Availing myself of your permission, I sent an order to Mr. Boulton, sometime ago, for twenty-five tons, in addition to the twenty tons expected early in the spring; and these, with the five tons from Mr. Harrold, would sufficiently supply the Mint till the spring of the year 1817.
If you think proper, sir, you will please to signify your approbation of my acceding to the above proposal.
I have the honor, &c.
Hon. A.J. Dallas, Secretary of the Treasury.