Q. David Bowers
"In concluding his observations on the proposition to restore the silver dollar of 412-1/2 grains, the director thinks it proper to state what in his opinion would have been the probable effect had the silver dollar not been omitted as one of the coins to be issued under the provisions of the Coinage Act of 1873. Before silver could have been coined into dollar pieces at an advantage to the owner over a sale in the market as bullion, its price would have had to fall to about 58-1/2 pence per ounce British standard. Although silver fell to this point in November and December of 1873, it appreciated sufficiently in the early part of 1874 to have made the dollar more valuable as bullion than coin. The price settled, of course, making it impossible to determine with certainty to what extent the coinage of silver dollars in the United States would have retarded the depreciation of silver.(This is a reference to the Silverites' false expectation that had the government been forced to buy silver in quantity for the coinage of silver dollars, this would have maintained the price. Linderman's observation was either prescient, or based on talks with Bland, Allison, and other Silverite legislators; two years later in 1878 this did happen under the Bland-Allison Act.) It would, no doubt, have had a somewhat greater effect in that direction than the coinage in the meantime of silver for the redemption of fractional currency, but France and her monetary allies might and probably would have taken advantage of such an opportunity to adopt the single gold standard, and cease altogether the coinage of legal-tender silver coins instead of merely placing as they did a limitation on their coinage and issue of silver, which would have thrown a supply on the market greatly in excess of the amount which could possibly have been used for coinage in the United States.
"I think it is safe to assume that had our mints been open for the coinage of the silver dollar and no. further change in European monetary standards had occurred, the effect would have been to have kept the price of silver bullion up to a point at which it could not have been profitably coined into dollar pieces until after May 1875, when the prices settled to 56-1/2 pence per ounce British standard. The silver dollar would have been receivable for customs-duties to the United States, and there would have been a demand for it for that purpose to the extent of the capacity of the mints to coin it, say $40,000,000 per annum.. This coin would have passed in and out of the Treasury continuously and taken the place of so much gold coin. The silver dollar would have taken this course for the simple reason that while silver in the market was worth 111.4 cents per standard ounce in gold, the coining rate was 116.3 cents per ounce, which, after deducting 1/ 2% for coining, would have given the depositor of silver at the mints a profit of nearly 4-1/2%, which profit would have increased to 25% when silver fell to 47 pence. The use of gold in the payment of customs-duties would have decreased as the supply of silver dollars increased, and by this time it is probable that the Treasury stock of coin would have consisted principally of silver dollars. As all the silver dollars that could have since been coined would have found employment in the manner indicated, they would thereby have been given a value as money above their value as bullion, as well as above that of legal-tender notes, and consequently could not have circulated concurrently with the latter.
"Having stated and discussed the salient points connected with the restoration of the dollar of 412-1/2 grains, I shall next refer to it and the other propositions as having for their object the establishment by law of a double standard of gold and silver on the following ratios, 1 to 15-1/2, 1 to 15.9884, and 1 to 16. The last two propositions being substantially the same, they will bereferred to as 1 to 16. In plain words, these propositions are to stamp 15-1/2 and 16 ounces, respectively, of pure silver, and one ounce of pure gold, as of the same value, with unrestricted coinage and unlimited legal tender."
An Epitaph on the Series
Circulating Seated Dollars and the Pittman Melt by Harry Salyards, M.D. (Specific contribution to the present book.)
As commented upon several times during discussion of the last few dates of the Liberty Seated dollar series, these coins did not circulate after silver fell in value and specie resumption occurred in 1878. Contemporary accounts tend to ignore them, however; thus, Evans (Illustrated History of the U.S. Mint, Philadelphia, 1887, p. 137), reports "the total circulation of silver dollars from the passage of the act of February 28, 1878 to [January 1, 1884] as 161,425,119," a figure in close agreement with the Guide Book of United States Coins figures for Morgan dollar mintages 1878-1883 (161,430,080). Elsewhere, citing "statements of the Treasurer and Comptroller of the Currency," he treats the total Morgan mintage-to date as equal to the silver dollars in circulation (p. 131). During 1884, the percentage of silver dollars in the Treasury, as opposed to being in circulation, held fairly constant in the range of 74 to 78%. As the total mintage went from over 111 million on July 1, 1883 to over 142 million on October 1, 1884, the amount in circulation rose from 35 million to over 40 million.
In short, some silver dollars were being paid out of the Treasury-otherwise the percentage therein would have continued to creep up; but other silver dollars, unpopular in circulation except in the West, were finding their way back to the Treasury. A portion of this equilibrium were those Liberty Seated dollars which had escaped the melting pot, and returned to domestic circulation. For example, as of January 1, 1884, if half of the original Liberty Seated mintage remained extant-a total of 3,249,810 coins-there would have been about One Liberty Seated dollar for every 50 Morgans coined to that date. So for every 1,000 silver dollars going back to the Treasury as a part of the ordinary circulation of the time, we can posit that 20 Liberty Seated dollars were included.
But what was the total extent of this circulation in and out of the Treasury? Referring again to the table in Evans, p. 137, it appears that approximately one in seven dollars coined January 1, 1883 to October 1, 1884 left the Treasury. But this obviously doesn't have to mean "one in seven going out, none coming back," but rather "two in seven newly coined going out, one of seven previously in circulation coming back," or "three in seven coined leaving the Treasury, two of seven coming back from circulation." If dollars were circulating, as indeed they were (albeit to a limited degree), there has to have been an equilibrium. For purposes of argument, let's choose the "two in seven out, one in seven back" option.
By the end of 1904, Morgan dollar mintage totaled 570 million pieces. If those continued to be paid out and returned to the Treasury in the same "two in seven, one in seven" proportion, by that time 163 million would have been paid out, and 81 million would have been returned. But some fraction of those "returning" dollars would have been Liberty Seated. By that date, there were 88 Morgans for every one Liberty Seated dollar originally coined-176 Morgans for every Liberty Seated dollar extant, if we assume 50% destruction, as above. Let one in 176 of those 81 million silver dollars returned to the Treasury by 1904 be Liberty Seated examples, and you have at least 460,000 Liberty Seated dollars sitting in the Treasury susceptible to the Pittman melt of 1918. This figure might be high; certainly collector interest was intervening to save the Liberty Seated dollars seen in circulation by the early 1900s-but it also might be low, if less than 50% of the series' mintage had been destroyed prior to the mid 1870s.
We can never know for sure; but if 460,000 Liberty Seated dollars were in the Pittman melt, another 7% of the series was lost in that single event.