US Coin History: The First US Mint

David Rittenhouse, at age 60 and in poor health, reluctantly agreed to become the first Mint Director. He held the office three years with great dedication, sometimes paying Mint debts out of his own pocket. Engraving by Edward Savage, based on 1796 portrait by Charles Willson Peale. Public domain image.

Not until three years after the Constitution was put into effect in 1789 did the newly seated Congress again take up the coinage issue. Finally, on April 2, 1792, Congress approved an Act requiring coins to be minted bearing the words "United States of America" and "an impression emblematic of liberty, with an inscription of the word Liberty, and the year of the coinage...". This was the first major step in establishing our national coinage system.

The Act authorized the salary of the Director of the Mint, who was to receive two thousand dollars annually, and other mint officials. President Washington appointed a famous scientist and philosopher named David Rittenhouse to be the first Director, a man widely respected for his professionalism and integrity.

A self-educated genius, Rittenhouse constructed America's first astronomical observatory with telescope, helped arbitrate the famous Mason-Dixon line, invented the metallic thermometer, advanced the field of mathematics, and was a master clockmaker. So highly regarded was Rittenhouse, that along with Washington, Thomas Jefferson and Alexander Hamilton both urged him to accept the Director's position.

As this romanticized 1920 painting by Edwin Lamazure depicts, the original Philadelphia mint facility (circa 1817) actually consisted of three buildings, and were located just two blocks from where today's Mint facility is located. The three-story building stood until it was razed in 1911. Public domain image.

The 1792 Act also mandated the construction of a new minting facility for the United States, the first buildings erected for public use under the Constitution. Located at Seventh Street and Filbert in Philadelphia, the stone foundation for the first building was laid in the summer of 1792. Eventually, three buildings comprised the original mint.

The new law permitted anyone with gold and silver bullion to come in off the street to the Mint and have it coined free of charge. The Mint would have preferred an exchange program, trading coins held in reserve in return for private bullion, but since Congress did not establish a Mint bullion fund, a quick exchange program was not possible. Unfortunately, most potential depositors did not care to wait for their bullion to be coined, and consequently, few coins entered circulation in this fashion.

Interestingly, as an indication how 18th century jurisprudence differed from modern times, any mint employee found guilty of embezzling any sum or engaging in any fraudulent Mint-related activity for profit, was to receive the death penalty. Nowadays, this sort of criminal behavior is actually treated in some circles as qualification for a higher position in life!

A bimetallic system was provided for, at a ratio of fifteen (silver) to one (gold). The copper coins were not designated as legal tender, and so could be refused by banks, merchants, and private individuals. Eventually, the non-legal tender status of the copper coins did lead to a problem that wasn't solved until the 1850's.

The first coin struck by the United States was the half dime (originally spelled "disme") on or prior to July 13, 1792, shortly before construction of the Mint facility had even started. Legend has it that the silver to produce the half dime was donated by George and Martha Washington. The coins were struck in the basement of John Harper, a citizen of Philadelphia. Fifteen hundred of these pieces were minted, but only as pattern coins, and were not intended for circulation, though some of them did reach the public. Many historians believe the portrait on the half dimes was modeled after Martha Washington.

This 1915 painting by John Ward Dunsmore, "Washington Inspecting the First Money Coined by the United States", depicts a gathering of governmental dignitaries to witness the striking of the 1792 half disme pattern (inset photo). Included in Dunsmore's version of the event were President and Mrs. Washington, Secretary of State Thomas Jefferson, Treasury Secretary Alexander Hamilton, and Mint Director David Rittenhouse (there is no documentation suggesting this high level meeting actually happened as shown). Though not a regular mint issue, the 1792 half dime attracts great respect from modern day collectors, bringing upwards of $300,000 for specimens in MS-64 Uncirculated condition. Coin photo courtesy of Ira & Larry Goldberg Coins & Collectibles, Inc., Beverly Hills, CA..

Other patterns of various denominations were also minted in 1792, none released purposely into circulation.

For many years, the standard reference book for pattern coinage has been United States Pattern, Experimental, and Trial Pieces. The latest edition, the 8th, was released in the summer of 2003, after being edited by the dean of American numismatics, Q. David Bowers. Readers will find a great deal of information in this book, complemented by high quality pictures. Highly recommended for collectors wanting to learn more about this overlooked area of numismatics.

The initial large cent variety featured a chain reverse, discontinued after only a few months. The chains conjured up visions of bondage, considered by many to be a bad omen for liberty. Image courtesy of EarlyAmerican.com.

The first coins to reach the general population were the copper half cent and one cent coins of 1793. The one cent coins were dubbed "large cents" because they contained exactly twice as much copper as the smaller half cent (in those years, a half cent could actually buy something).

The first large cent design was met with much criticism. Amongst other complaints, the Pennsylvania Gazette editorialized that "...liberty herself appears to be in a fright...". The Mint went through several engravers before finally settling on the Liberty Cap type later in 1793.

A book for serious collectors is Penny Whimsy, by William Sheldon. An icon in numismatic circles, Sheldon spent many years cataloging each large cent variety struck, and assigning a rarity number. An ideal research tool for those interested in early U.S. cents. Tons of information presented in an entertaining and informative manner. Sheldon is also credited with devising the 70-point grading system prototype that eventually evolved into the ANA grading scale in widespread use today.

The following year, 1794, the first silver issues were released: the five cent half disme (today spelled "dime"), the half dollar, and the silver dollar. Dismes and quarters were first issued in 1796. Gold coins arrived on the scene in 1795, in the form of the ten dollar gold eagle and the five dollar gold half eagle. Quarter eagles, valued at two and one-half dollars, were introduced in 1796.

Horse powered roll mill. The horse is located in the room below, flattened metal strips coming out of roller in room above. From "An Essay on Coining" Public domain image.

The coining process of the early Mint was very primitive by today's standards. The first rolling mill machine, used to prep precious metal sheet strips for flatness, was powered by a pair of harnessed horses (though only one shown in the drawing) circling in the basement below.

The metal strips were rolled numerous times, interspersed with repeat trips to the annealing oven, to prevent brittleness and cracking. At the end of this tedious process, the strip thickness merely approximated the thickness of the intended planchet. Only after another trip to the oven, lubrication, and then followed by pulling through a drawing machine, did the metal strip equalize out for thickness and width.

Several images in this section of coin making two centuries ago are reproduced from "An Essay on Coining", a rare, contemporary set of illustrations and descriptions by die sinker Samuel Thompson. "An Essay on Coining" is now part of the collection of the American Numismatic Society, but numerous copies exist elsewhere.

Planchet cutting press. The unused skeleton strips were sent back to the melting pot. From "An Essay on Coining". Public domain image.

The strips were then washed to remove the lubricant, passed through the annealing oven again, cut lengthwise to make multiple narrow strips, and brought to a screw press machine to cut out circular planchets from the metal strip. Each planchet was annealed and later cleaned. Unused metal from the perforated strips were returned to the furnace for melting down into other coins.

By 1795, the Mint was operating three planchet cutting presses, with a total punching capacity of 15,000 to 18,000 planchets daily.

The planchets were then weighed. Those heavier than their permitted tolerance range were filed across the face to remove material. This is why some of the earliest United States coins bear ghastly file marks, a result of weight adjustments by the mint's original employees, much to the chagrin of today's collectors. Underweight planchets were doomed to the furnace to begin the entire process over again. The surviving planchets were placed individually on a milling machine where reeded or lettered edges were impressed, as dictated by the coin's design. Coins intended to have smooth edges bypassed this step.

A large screw press. Technically speaking, coin images were "squeezed" onto softened planchets, rather than struck. Note the boy operator seated in front of the press, a common occurrence prior to the passage of child labor laws. Public domain image.

After another pass through the annealing oven to renew softness, the planchets were ready to be stamped with an impression, an operation popularly known as "striking", though as we shall see shortly, perhaps a better term for this action, using antiquated machinery, is "squeezing".

A large screw press was utilized to strike the planchets. It took at least three operators to run the screw press, one on both ends of a weighted iron bar and another sitting in front of the press. The bar operators would turn the bar, causing a heavy iron screw to slowly advance an upper die downward towards a lower die, with considerable force. If a planchet was positioned between the dies before they were brought together, the planchet would be "struck", leaving an impression of a coin on both sides.

Pushing the bar in the opposite direction had the effect of raising the upper die. The seated operator inserted planchets and removed the finished coins. A well coordinated team of operators could strike several dozen small coins per minute. It took coiners three years to produce our nation's first million coins. To produce the same amount today takes about half an hour!

The most detailed book we have ever seen on the early years of the Mint is called The U.S. Mint and Coinage, by Don Taxay. The book is rather old, published in 1966, but it remains one of the finest works ever compiled on U.S. coins. Taxay did an incredible research job, using original documents, to piece together the story of our early coinage and the part it played in the history of the United States. Taxay's frequent use of written correspondence between historical individuals (transcribed to print for easy reading) transports you back in time, to the point where you can almost sense the ghost of David Rittenhouse hovering over your shoulder. No longer in print, you might find a used one through Amazon, or perhaps your local library carries a copy. A real treasure. Absolute highest recommendation.

For many years after the Philadelphia Mint began operating, coins failed to appear in sufficient numbers throughout the United States. As mentioned in the sections above, the Mint was plagued by poor facilities and the lack of a bullion fund for making possible a "coins-for-privately-owned-bullion" exchange program. To make the most out of a dismal situation, the Mint produced a disproportionate share of half dollars, taking advantage of the increased productivity in turning out half dollars (i.e. it took five "hits" to make fifty cents in dimes, but only one "hit" with a half dollar to coin an equal face value amount). As a result, tiny quantities of small denomination silver coins were struck in those years. An 1830 Senate committee reported that so few quarters, dimes and half dimes were made that the total number of small-denomination silver coins produced since the Mint's opening amounted to less than one piece for each person in the country!

The First Bank of the United States, as seen in this 1799 engraving. The bank building still stands today in Philadelphia, though it is closed to the public. Public domain image.

As the Mint's reputation languished, a serious move was underway, beginning as early as 1795, to close down the Mint and transfer coining operations to the Bank of the United States. The brainchild of America's first Treasury Secretary, Alexander Hamilton, the semi-public institution was chartered in 1791.

The debate leading up to the Bank's charter was one of the first, great political controversies to rage in the United States. Some, led by Thomas Jefferson, believed there was no provision for a federal bank since it was not specified by the Constitution. Hamilton contended that a wide array of powers could be implied from general clauses written into the document. In the end, President Washington sided with Hamilton, setting the important precedent for a broader interpretation of the government's authority.

The bitter debate also contributed to the formation of political parties. Jefferson, James Madison, and others, fearing an increasingly powerful federal government, consolidated themselves politically to speak up for states' rights. Jefferson soon started calling his party of colleagues Republicans. This is not to be confused with the present-day Republican Party, which was not organized until 1854. Within a few years, the party of Jefferson came to be known as the Democratic-Republican party, and starting in 1828, the name was shortened to the Democratic Party, the party we recognize today by the same name. Those whose views were closest to the beliefs of Hamilton organized themselves as the Federalist Party.

In spite of its opposition, the Bank did see some success in its first years, infusing secure paper money into the economy, forming a source of capital for investors, helping establish the creditworthiness of the United States, and effectively managing some of the government's fiscal affairs, most notably the Louisiana Purchase of 1803.

This engraving by William Birch shows the north wing of the US Capitol building, housing the Congress, the Supreme Court, and Library of Congress in the fall of 1800, when the federal government was being established in the new capitol city of Washington, D.C. Inside these walls, momentous decisions directing the long term course of the United States were being made, including the fate of the US Mint. Beyond the Capitol is a view westward towards the President's House, eventually to be called the White House. Image courtesy of Library of Congress.

Hamilton argued the Bank could operate more efficiently than the Mint, and was in a better position to acquire precious metal bullion. Several votes in Congress to abolish the Mint were held, but were narrowly defeated.

The battle between the Congress and the US Mint carried on for a few years more. Finally, in January, 1803, Mint Director Elias Boudinot filed a report with Congress, with plans on improving Mint efficiency, dramatically shifting momentum in favor of the Mint. Shortly thereafter, a bill was introduced to retain the Mint, and was enacted into law on March 3. The Mint was saved. Never again was the idea of abolishing the Mint seriously considered. In an odd twist of fate, it was the Bank of the United States that eventually was disbanded, failing in 1811 to be re-chartered (though the Second Bank of the United States was established in 1816, it too met a similar demise in 1836).

For scholars desiring to understand the political battles waged by the Mint for survival in the early years, here again, we cannot recommend a more authoritative source than Don Taxay's The U.S. Mint and Coinage. In reading the letters of Jefferson, Hamilton, et. al, one is left in awe of the intelligence and farsightedness of the Founders. Had ordinary men been at the helm during those formative years, the United States probably would have never developed into the great nation it became.

In addition to crude minting conditions and no bullion fund, the expected movement of new coinage into the channels of trade was greatly impaired by metals speculators, who exported overseas as many gold and silver coins as they could obtain.

Thomas Jefferson, whose résumé includes authorship of the Declaration of Independence, 3rd President of the US, chief sponsor of the Louisiana Purchase, and architect of the dollar decimal system, a man of great influence on America in her infant years One of his most fervent beliefs was that states and individual rights were always to be protected. Jefferson died on July 4, 1826, exactly 50 years after he and his compatriots signed the Declaration. Image courtesy of White House archives.

The basic reason for this one-way flow was the existing weight ratios between the American money and foreign currency. On the European market, the bullion value of the American coins was more than their face value, and as a result, many of these coins found their way to the melting pot.

The problem was especially acute for silver dollars, because worn Spanish dollars of lesser weight were readily swapped for new United States silver dollars, meaning many of the new dollars left the country soon after they were minted.

The metal imbalance situation got so out of hand that in 1804, President Thomas Jefferson ordered a suspension of gold $10.00 Eagle production. In 1806, Jefferson likewise halted silver dollar production. Not until 1836 did coinage of silver dollars resume. For three decades, then, the basal United States coin was not even minted.

In the absence of the dollar, the half dollar, in effect, became the "coin of the realm", produced in larger numbers than any other silver denomination. But rather than finding its way to the general public, the half dollar replaced the discontinued dollar as the coin most often held in bank reserve vaults, or transferred between banks to consummate large transactions. Both circumstances prevented many half dollars from ever experiencing heavy circulation, explaining why an unusually high percentage of the early half dollars survive to this day in above average condition.

Ironically, Philadelphia Mint records indicate nearly 20,000 silver dollars were coined in 1804, but certainly, all of them carried the date 1803. In those early years, dies were operated as long as their condition was utilizable. Official annual mintage totals referred to the quantity of coins struck, without regard to the date on the coins.& Thus, the 1804 report of Mint Director Elias Boudinot included the 20,000 dollars struck in 1804, but it is highly likely the dollars were dated 1803. Image courtesy of the American Numismatic Association.

One of the most highly publicized U.S. coin rarities is the 1804 silver dollar, of which fifteen specimens are known to exist today. Researchers have determined the 1804 dollars were actually struck in 1834-35 for proof set purposes. Jefferson's silver dollar ban of 1806 was still in effect, and so to avoid the appearance of violating the prohibition, the date of 1804 was chosen. Re-strikes of the "1804 dollar" were issued in 1859 to satisfy a few well-connected collectors.

Whenever an 1804 dollar is sold, worldwide attention is generated. Over the last few years, new owners have paid amounts ranging from a "paltry" $874,000 to well over $4 million to acquire one of these prized coins. Recall that there are fifteen known examples of dollars dated 1804. However, no one is certain how many were actually minted. Perhaps now is the time to scour through grandma's shoe box of old coins! (Oh well, we can always dream on....)

All of our earliest United States silver dollars are today exceedingly rare, for the reasons outlined above. They are more than just symbolic of the survival struggle of the fledging United States; the early dollars are intertwined with American history itself. The United States Early Silver Dollars 1794 to 1803 is a classic study, shedding light on one of the most treasured realms of American coin collecting. Spanning the first decade of American silver dollars, this book explains the gripping saga of how an infantile nation overcame formidable obstacles to develop a monetary system emblematic of United States sovereignty. At least two hundred photos. A++++.