User:Mregan5
Parliament of Great Britain set up the Currency Act of 1764 to regulate the production of paper money in the colonies. They did it to not keep them from making it, but to keep them from paying back debts and other purchases. This policy had caused distress amongst the colonies. This also continued to bring more tension between the colonies and Britain. ________________________________________________________________________
Currency act of 1751
[edit]The colonies of New England had issued paper money as a way to help pay for military expenses from the French and Indian War. More money was given out than was taxed on and this caused the money to depreciate compared to the British pound sterling. This hurt the British merchants who were forced to take this depreciated form of currency. The act limited how much paper currency they could create and allowed the ones already made to be used for public debts but not private debts. [1] ________________________________________________________________________
Currency Act of 1764
[edit]This was an expansion of the act of 1751 to all the British colonies in North America. It limited the amount of paper money they could create and what they could use it on. The act also forced governors to eventually do away with all forms of paper money. If they failed to follow this would be fined 1,000 sterling. Britain had their own debt to cover and was being hurt by the depreciated money being paid out by the colonies.[2] This created even worse financial problems for the colonies because of the minimal amount of silver and gold they had access to. The citizens were not allowed to use their paper money to pay back public or private debts. If they needed to do this they were forced to use gold or silver as legal tender. Later Parliament did allow the colonies to use paper currency to pay back public debts but still not private debts. These debts were mostly to merchants from Britain who needed to be paid in sterling. _______________________________________________________________________
Attempted Repeal
[edit]Benjamin Franklin spent several years fighting the Currency Act, demanding a repeal. Franklins proposal started with parliament would repeal the Currency Act of 1764, as well was the act of 1708, which regulated the maximum values at which foreign coin would pass in America. He thought all paper money already in circulation should be destroyed and parliament could authorize the building of colonial loan offices. These load offices would issue millions of pounds of legal-tender notes from England. The loans were supposed to have double security by a mortgage of real clear estate. This plan helped the British because the coin would provide a remittance to Britain.[3] The colonies needed a repeal. Their economy as already a struggling one and the Currency Act took away the only form of currency that they had. This spun them into an even worse economic state.[4] By 1766 Franklin had decided he wanted just a simple repeal of the Currency Act of 1764. With this he just wanted the colonies to go back to former currency practice and royal controls. Pennsylvania and other colonies had sent requests of a repeal of the Act to Parliament several times following Franklins plan. The Committee of North American Merchants got the answer from the Board of Trade in February of 1767. Their reply was a way of letting them know that paper money was not helpful to them, and that the Currency Act was still going to stand.[5] It would later be revised but not done away with completely. ________________________________________________________________________
The British and Parliament
[edit]The British were out to defend their own investments. Many of the rules put in place were set to protect their own economy. The paper money was damaging to their economy because of the fact that they were getting less for what was owed. The problem was that it was harder for the American colonies to get gold and silver.[6] Parliament did not want to lose power over the colonies. Along with the taxing, making this currency act continued their strong hold on the colonies. It kept them from becoming more self-efficient and caused them to be in more debt with the British. ________________________________________________________________________
==References==
- ^ Ernst, Jospeh. “The Currency Act Repeal Movement: A Study of Imperial Politics and Revolutionary Crisis, 1764-1767” The William and Mary Quarterly. Third Series, Vol. 25, No. 2 (Apr., 1968), pp. 177-211.
- ^ Ernst, Jospeh. “The Currency Act Repeal Movement: A Study of Imperial Politics and Revolutionary Crisis, 1764-1767” The William and Mary Quarterly. Third Series, Vol. 25, No. 2 (Apr., 1968), pp. 177-211.
- ^ Ernst, Jospeh. “The Currency Act Repeal Movement: A Study of Imperial Politics and Revolutionary Crisis, 1764-1767” The William and Mary Quarterly. Third Series, Vol. 25, No. 2 (Apr., 1968), pp. 177-211.
- ^ Green, Jack and Richard M. Jellison “The Currency Act of 1764 in Imperial-Colonial Relations, 1764-1776”, The William and Mary Quarterly.
- ^ Ernst, Jospeh. “The Currency Act Repeal Movement: A Study of Imperial Politics and Revolutionary Crisis, 1764-1767” The William and Mary Quarterly. Third Series, Vol. 25, No. 2 (Apr., 1968), pp. 177-211.
- ^ Ernst, Joseph A. "Genesis of the Currency Act of 1764: Virginia Paper Money and the Protection of British Investments." The William and Mary Quarterly Third 22.1 (1965): 33-74. JSTOR. Web.