(CNN Spanish) — The dollar, which today is as much a symbol of the United States as the Statue of Liberty, has a history that goes back to before its independence and that is linked to a territory that is difficult to imagine: the Spanish empire.
This August 8th is National Dollar Day, commemorating the date in 1786 on which Congress established the dollar as the official unit of account of the federal government. as explained by the University of Delaware.
Its history on North American soil, however, began to take shape when the United States did not yet exist as such.
The imprint of the Spanish empire on the dollar
In colonial times, coins and paper money created in the territory and from abroad coexisted.
As early as 1690, the first local paper money was born, the “colonial notes” issued by the Massachusetts Bay Colony to finance military expeditions, according to information from the Federal Reserve Board Monetary Education Program.
Over the years there were other options. In 1775, for example, against the backdrop of a by then inevitable war for independence, the Continental Congress authorized the issuance of a “continental currency” to finance the conflict. The currency quickly lost its value due to lack of solid backing and counterfeits. And that’s where the phrase “not worth a Continental” comes from, that is to say something that “is not worth a continental”.
In addition, various foreign currencies circulated in the territory: German thalers, British pounds and the “real de a ocho” or “peso fuerte” of the Spanish empire, which in English was known as the “spanish milled dollar”, review the Mint.
The latter became the favorite due to “the consistency of the silver content over the years,” explains the institution. “To get change for a dollar, people would sometimes cut the coin into halves, quarters, eighths, and sixteenths to fit fractional denominations that were in short supply,” she says.
The decimal system as a symbol of a new identity
In addition to 1876, a milestone in the history of the dollar is 1792, when Congress passed the Coinage Act in which it determined the creation of a mint in Philadelphia, which was then the capital (a curious fact that highlights the Mint of its history: in 1795 it became one of the first federal agencies to hire women, who at that time did not yet have the right to vote).
That law adjusted the US dollar to the Spanish one, which was the known reference, and established the decimal system. In addition, the metal and value of the first coins that it would produce was determined. In copper those of half a cent and a cent; in silver the ten cents, the quarter dollar, the half dollar and the dollar; and gold the 2.5, five and 10 dollars.
This decimal system was completely different from the one you had on the foreign coins that circulated.
“They ended up adopting a system that was completely new … which was a base 10 system. I think the founding fathers thought that if we were really going to be an independent entity and be taken seriously, we needed our own identity. And why That’s why they chose the system that was unlike anything of the time,” explained University of Delaware economics professor Vincent Marra.
The dollar sign had already been consolidated previously, in 1785, as a result of a modification of the peso symbol.
And the green of the bills?
The green of the banknotes is the result of another story whose fundamental date is 1861, according to the Federal Reserve Board.
That year, Congress authorized the Treasury Department to issue interest-free “demand notes” called “greenbacks” because they had green ink on the back. Does the image sound more familiar to you?
The first $10 bills bear the portrait of President Abraham Lincoln. The Treasury issued these notes, redeemable for gold or silver “on demand” at seven specified banks across the country, in 1861 and 1862. Congress then authorized a new class of currency known as “United States notes” or “Legal Tender notes.” “. It was also green.
In 1862, “demand notes” incorporated fine-line engraving, geometric patterns, a Treasury Department seal, and engraved signatures to help deter counterfeiting. According to the Federal Reserve, this is the foundation of the “modern model.”
The origin of the word, even more distant
The word “dollar” comes from the German “thaler” (tálero in Spanish), which is a shortened version of “joachimthalers”, according to the explanation of the Museum of the Czech Center of Houston.
“The thaler originally referred to silver coins minted in the silver mines of a town called Joachimsthal in Bohemia, now Jachymov in the Czech Republic. The original thaler bore a lion of the coat of arms of the Kingdom of Bohemia on one side,” explains the museum. Thalers have been made in Joachimsthal since the 16th century.