Tuesday, December 06, 2011

The Coinage Act of 1890: 25 Year Rule for U.S. Coin Designs Often Misunderstood

Barber coinage debuted in 1892
When I talk to coin collectors today, I find that most are aware of the law requiring that all coin designs for U.S. coins must be used for a minimum of 25 years before the U.S. Mint can make a change to the design without Congressional approval.

I have also learned that many collectors believe that law was put in place to keep coin designs from changing too often. With the proliferation of coin designs over the past decade or so, and Congress seeming to pass new legislation authorizing new coin designs everyday, they believe that this law has been a failure.

But they actually have it backwards.

The "25 year rule" was not meant to keep coins from being redesigned too often, it was meant to get them to change more often.

Roosevelt dime debute in 1946
The Coinage Act of 1890

The Coinage Act of 1890 allows the redesign of U.S. coins without Congressional approval as long as the designs have been in use for at least 25 years.

A section of the legislation states that "no change in the design or die of any coin shall be made oftener that once in twenty-five years from and including the year of the first adoption of the design, model, die, or hub for the same coin."

Prior to passage of this law, the Director of the U.S. Mint could only make changes to coin designs when Congress authorized it.

At first it would seem that this law was passed because designs were changing too frequently and the law was meant to slow this down to only once every 25 years.  But it was actually passed to have the opposite effect. Its purpose was to have coin designs change more frequently.

Kennedy half dollar debuted in 1964
Inferior Coinage

By the time the Coinage Act of 1890 passed in Congress, it had been over 50 years since any significant change had been made to the dime, quarter dollar, or half dollar.

In his annual report of 1887, U.S. Mint Director James Kimball referred to the "inferiority of our coinage" in comparison to "almost every other advanced nation of the Earth." He believed that there was "a popular desire for an improvement of the coinage in respect to the present designs," and that he should be allowed to change them. It was at his request that the Coinage Act of 1890 was submitted to Congress.

Long Live the Lincoln Cent
Lincoln cent debuted in 1909

At first the Coinage Act of 1890 appeared to work like a charm  as the Barber dime, quarter dollar, and half dollar all debuted in 1892 and, at the end of their 25 year minimum, were immediately replaced by new designs in 1916.

But a quick look at our current coinage shows that this is no longer the case. The 1890 law has long lost its influence over the coin designs we see in our pockets today.

Personally, I can't wait to see the new Lincoln cent reverse in 2059, but I think I already have a pretty good idea what the dime will look like.