Coinage Act of 1873
Last updated
Was this helpful?
Last updated
Was this helpful?
The Coinage Act of 1873, also known as the "Fourth Coinage Act" or the "Crime of '73," was a significant piece of U.S. legislation that had a profound impact on the country's monetary system. Here's a summary of the Coinage Act of 1873:
The Coinage Act of 1873 was passed by the United States Congress and signed into law by President Ulysses S. Grant on February 12, 1873.
The Act aimed to revise and standardize the country's coinage and monetary system, but it had controversial consequences that reverberated for decades.
Demonetization of Silver: Perhaps the most contentious aspect of the Act was the decision to stop minting silver dollars for circulation. The Act effectively demonetized silver by discontinuing the free coinage of silver into silver dollars.
: The Coinage Act of 1873 established the gold standard as the primary basis for the U.S. monetary system. It firmly tied the U.S. dollar to gold, specifying the gold content of various denominations of coins.
End of Bimetallism: The Act marked a transition away from bimetallism, where both gold and silver could be used as the basis for currency. It favored gold as the sole standard for currency.
The Act's demonetization of silver was highly controversial, particularly among Western and Southern farmers and miners. They believed that it would lead to deflation and negatively impact their economic interests, as silver had been a significant part of the money supply.
Opponents of the Act, primarily Democrats and agrarian interests, referred to it as the "Crime of '73" and argued that it favored Eastern financial elites and creditors over the interests of debtors and the broader population.
The debate over the Coinage Act of 1873 played a central role in American politics during the late 19th century, leading to the rise of the Populist movement and calls for the return to bimetallism.
The Act was partially amended by the Bland-Allison Act of 1878 and then more significantly by the Sherman Silver Purchase Act of 1890, both of which attempted to reintroduce silver coinage to the monetary system.
The populist movement of the late 19th century, as well as the subsequent adoption of the gold standard and the end of bimetallism, were all influenced by the controversies and economic consequences stemming from this legislation.
The Act's consequences were intertwined with broader economic and political issues of the era, including debates over currency, agricultural prices, and the power of financial interests, and it remains a significant part of American economic history.
The Coinage Act of 1873 had a lasting impact on the U.S. monetary system and the nation's politics. The became firmly entrenched, and the debate over monetary policy continued for decades.
Be sure to to receive product and service updates from OpenBullion.