The E-Sylum:  Volume 10, Number 19, May 13, 2007, Article 20

LEGAL TENDER STATUS RATIFIED IN COINAGE ACT OF 1965

Relating to the more general question of foreign coins as legal
tender, David Ganz writes: "See Feb. 21, 1857, ch. 56, 11 Stat. 163
(determines legal tender of Spanish pillar dollar (continue) and
other coins (denied).

"When the Coinage Act of 1965 was passed, it had an important clause
that ratified the legal tender status of all American coins and
currency previously produced (thus finally legalizing the trade
dollar).

"In the hearing held June 4, 1965, Rep. Wright Patman, chair of the
House Banking & Currency Committee, asked Treasury secretary Henry
Fowler whether the coins being authorized 'will have the stamp of
the United States recognizing that each coin is legal tender for
all debts, public and private' to which Fowler replied in the
affirmative.

"On page 20-21 of the hearing, Fowler was asked 'if they have
something owing to them, they are compelled by law to accept these
coins' to which Fowler answered 'Correct'. Money becomes a commodity;
paper currency a medium of exchange.

"Chairman Patman clarifies 'two points on the record' on page 32 of
the same hearing. 'all coins, all paper money are all of equal value
as legal tender. You can pay a million dollar debt with copper cents
if you want to. That has not always been true. You can pay any debt
with 5-cent pieces or 25 cent pieces, and it makes no difference.
It is all acceptable legal tender'.

"Secretary Fowler than acknowledges that some vending machines don't
accept half dollars and that some coin-operated vending machines
are limited.

"On the floor debates, it is further clarified that this is nothing
'more than a restatement of existing law.'"

  Wayne Homren, Editor

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