Salmon P. Chase
Few people have influenced the American monetary system as much as Salmon P. Chase (1808-1873). But most numismatists do not realize the full extent of his influence.
Chase had an interesting political career. In 1840 he was elected a Whig Party candidate to Cincinnati, Ohio City Council. He soon left the Whigs to become the leader of the Liberty Party in Ohio. In 1848 he was one of the leaders who founded the Free Soil Party and was a member of that party as a US Senator from 1849 to 1855. Towards the end of his Senate career, he moved to the newly formed Republican Party and won the election for governor of Ohio as the party’s candidate.
He sought unsuccessfully for the Republican nomination for president in 1860. In 1868 he switched to the Democratic Party, but was unsuccessful in finding that party’s presidential nomination that year. While still a Democrat, in 1872 he submitted another unsuccessful application as a presidential candidate for the Republican Party.
After Abraham Lincoln was elected President, he appointed Republican Senator Salmon Chase (March 4-6, 1861) as his Treasury Secretary. In that position, Chase was a strong advocate for the US government to begin issuing currencies that cannot be redeemed for gold or silver on demand. This was done to allow the federal government to issue bonds to finance the cost of the civil war. Demand notes, the first paper money issued by the U.S. government, debuted in 1861, followed by legal tender notes in 1862 (commonly referred to as greenbacks because they were not backed by gold or silver). Chase placed his own image on the $ 1 Legal Tender Notes, Alexander Hamilton on the $ 2 Denomination, and Abraham Lincoln on the $ 10 Legal Tender Notes.
Chase later had his picture re-used on the front of the $ 10 annual one-year bond in 1863 and the $ 10 compound note in 1864.
In 1863, Chase directed James Pollock, the director of the US Mint, to create designs for coins bearing the slogan “In God We Trust.” The Coinage Act of 1864 gave Chase the power to include this phrase on 1 cent and 2 cent coins. The 2 cent denomination debuted in 1864, the first to carry this motto. Since 1938, all US coins have had to incorporate this motto into their design. A 1955 law required US currency to include the motto, which appeared on every currency issue until 1966.
The above information is well known to many American numismatists, but Chase was not yet done creating his legacy on America’s money. In June 1864, Abraham Lincoln accepted Chase’s fourth offer to step down as Secretary of the Treasury. Four months later, the Chief Justice of the Supreme Court, Roger Taney, died. Lincoln nominated Salmon Chase to succeed him on December 6, 1864, and was ratified by the Senate on the same day.
In 1870 the case of Hepburn v. Griswold (65 US 603) before the Supreme Court. It questioned the constitutionality of some provisions in the legal tender laws under which Chase had succeeded in obtaining the authority to issue currencies that could not be redeemed on demand for gold and silver. Chase did not oppose the case (which should have happened automatically since he was ruling on his own actions in 1861). In this case, he voted by a majority of 5 to 4 that some of his acts were in fact unconstitutional.
Therefore, the US government immediately stopped issuing paper money that cannot be redeemed for gold or silver on demand – right?
As we all know, to this day the US government has issued uncovered currencies. How did it happen?
Soon two new judges were appointed to the Supreme Court. A new round of legal tender cases came before the court (Legal Tender Cases, 79 US 457). This time, the 5-4 majority reversed the previous decision, despite Chase writing a strong minority opposition.
Chase’s death in 1873 did not end his influence on the American monetary system.
In 1877, John Thompson, who had previously co-founded the predecessor of today’s Citibank, founded Chase National Bank and named the bank in honor of Salmon Chase. A merger in 1955 changed the bank’s name to Chase Manhattan. In 2000 this bank merged with the private banker JP Morgan to form JPMorgan Chase Bank.
From 1928 to 1946, US $ 10,000 Federal Reserve Notes were issued bearing the portrait of Salmon Chase. Accordingly, these notes could not be redeemed for gold or silver on request.
Imagine how different America’s money could be today if Salmon Chase had never lived.
Patrick A. Heller was honored as FUN Numismatic Ambassador 2019. He also received the American Numismatic Association’s 2018 Glenn Smedley Memorial Service Award, the 2017 Exemplary Service Award, the 2012 Harry Forman National Dealer of the Year Award, and the 2008 Presidential Award. including twice in 2020), the Professional Numismatists Guild, the Industry Council for Tangible Assets and the Michigan State Numismatic Society. He is the communications officer for Liberty Coin Service in Lansing, Michigan, and writes Liberty’s Outlook, a monthly newsletter on rare coins and precious metals. Past newsletter editions can be viewed at www.libertycoinservice.com. Some of his radio commentary, entitled “Things You ‘Know’ That Just Are Not So And Important News You Need To Know,” can be heard on Wednesday and Friday mornings at 8.45am at the WILS in Lansing at 8.45am (the broadcast live). and becomes part of the audio archive on www.1320wils.com).
