What is Free Silver?

Free silver you say?

Erm, sort of! If you’ve been studying up on silver, particularly currency and history, you’ve probably run across the term ‘free silver’. But what is free silver?

Free silver refers to a political slogan in the last half of the 19th century in the United States and was brought about by social unrest, currency problems, politics and economical interests. The basic idea was to increase the amount of currency that the United States mint was putting out at the time. The debate was also over the matter of inflation.

Why Silver?

In the 1800s, silver became pretty valuable and was in demand for currency. At the same time, many countries were experiencing shifts in how they were doing their currency; Britain was moving towards a gold standard while France was trying out using both gold and silver, so the time was ripe for the population across the pond to start looking at their currency. At the time, it was also practice to bring in uncoined gold (gold chunks or nuggets) into the mint and get its worth (minus a small fee) in gold coins. This is how prospectors got paid.

Since silver was gaining in worth, people wanted to be able to treat silver the same way that gold was treated—they could bring in uncoined silver and get its worth in coins; hence the name, ‘free silver’.

Inflation and Free Silver

One of the main concerns around the idea of using silver for currency in greater amounts was because of the inflation concerns. If America followed the British model of a ratio of 16-1 (sixteen ounces of silver equals one ounce of gold in value), there would be inflation because the actual value was 32 ounces of silver to one ounce of gold. The cheaper price of silver could drive out gold altogether and cause inflation.

The other side of the debate argued that silver was more readily available than gold and that it would be easier for those in debt to pay off their debts faster. It wouldn’t get rid of all of the economic woes that characterized the late 1880s, but many supporters thought it would help because people would be able to pay off debt faster.

The rallying cry for each of them came down to Free silver vs Sound Money (or gold) and it swiftly became political as elections came up and politicians took a side with the Republicans for Sound Money and Democrats for Free Silver. A third party faction was in favour of paper money, but at this point they weren’t very popular.

Ultimately, free silver would be defeated by voters. Farmers weren’t interested and there were many powerful backers of the gold coin. However, Free Silver became something of a symbol for Populists and unionists with the idea being that the government should be willing to help people by producing money and other goods with more readily available resources and thus make it more accessible.

So free silver does not refer to the idea of getting silver for free, but it is an interesting (and often convoluted and misunderstood) part of American currency history.

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