Hugh McCulloch

Hugh McCulloch, 27th Secretary of the Treasury, appointed by President Abraham Lincoln

“The present legal tender acts were war measures, and while the repeal of those provisions which made the United States notes lawful money is not now recommended, the Secretary is of the opinion that they ought not to remain in force one day longer than shall be necessary to enable the people to prepare for a return to the constitutional currency. It is not supposed that it was the intention of Congress, by these acts, to introduce a standard of value, in times of peace, lower than the coin standard, much less to perpetuate the discredit which must attach to a great nation which dishonors its own obligations by unnecessarily keeping in circulation an unredeemable paper currency. It has not in past times been regarded as the province of Congress to furnish the people directly with money in any form. Their authority is “to coin money and fix the value thereof;” and, inasmuch as a mixed currency, consisting of paper and specie, has been found to be a commercial necessity, it would seem, also, to be their duty to provide, as has been done by the National Currency Act, that this paper currency should be secured beyond any reasonable contingency. To go beyond this, however, and issue government obligations, making them by statute a legal tender for all debts, public and private, is not believed to be, under ordinary circumstances, within the scope of their duties or constitutional powers.” — From the “Annual Report of the Secretary of the Treasury,” Dec. 4, 1865

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“…the prohibition of state tender laws will admit of no construction confining it to state laws, which have a retrospective operation. Accordingly, it has been uniformly held, that the prohibition applies to all future laws on the subject of tender; and therefore no state legislature can provide, that future pecuniary contracts may be discharged by any thing, but gold and silver coin.” — Supreme Court Justice Joseph Story, Commentaries on the Constitution, Volume 3, Chapter 33 (p. 463, § 1366)

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“The power to make any thing but gold and silver a tender in payment of debts, is withdrawn from the States, on the same principle with that of striking of paper currency.”

James Madison, Federalist, no. 44, 299–302

Read More at: The Founders’ Constitution

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“Most unquestionably there is no legal tender, and there can be no legal tender, in this country, under the authority of this government or any other, but gold and silver, either the coinage of our own mints, or foreign coins, at rates regulated by Congress. This is a constitutional principle, perfectly plain, and of the highest importance. The states are expressly prohibited from making anything but gold and silver a tender in payment of debts; and although no such express prohibition is applied to congress, yet as congress has no power granted to it, in this respect, but to coin money and to regulate the value of foreign coins, it clearly has no power to substitute paper, or anything else, for coin, as a tender in payment of debts and discharge of contracts… The legal tender, therefore, the constitutional standard of value, is established and cannot be overthrown. To overthrow it, would shake the whole system. The constitutional tender is the thing to be preserved, and it ought to be preserved sacredly, under all circumstances.
– Daniel Webster, in a speech before the Senate on December 21, 1836

 

From A plea for the Constitution of the U.S. of America: wounded in the house of its Guardians by George Bancroft, pp. 93-94

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