PCGS Reclassifies Early American Fugio Cent As Regular Issue Federal Coin

PS
The Continental Congress could not pass laws binding on States or throughout the Union. It had no power and no resources to coin money and declare it legal tender throughout the Nation. One of the reasons for the Constitution, addressed in Article I, was the power to coin money. Previously, the states were the issuers of currency, the value of which had declined to near zero in many instances.

After reading the Continental Congress Journal excerpt relied on by PCGS, I question whether these coppers were coins or bonds. They bear annual interest of 6% and are redeemable within 20 years. Not characteristics of typical legal tender coinage. Arguably an investment as much as anything else.

I agree with PCGS. We became a nation when we declared independence from the British in 1776, not just a bunch of independent states. We celebrate our independence and becoming a nation on July 4, 1776. The Continental Congress did not have to look exactly like the current Federal government for the United States to be a nation with an official government. The Fugio coins were money commissioned to be created by the official government of our nation.

Also the Fugio cents did not pay interest. The obligation to deliver coins under the contract for the copper coins and the option for early delivery together bore interest at 6%. That and whether the contract obligation was promised to be redeemable in 20 years are irrelevant. The Fugio cents were money.

The United States of America undoubtedly was Declared to exist on July 4th, 1776. I believe it came into existence, practically speaking, when the Second Continental Congress sent George Washington to Boston in 1775 to protect it from the British.The CC prosecuted the Revolutionary War under under the Articles of Confederation, bargained with France for financing and military aid, approved the Treaty of Paris officially ending the war, and promulgated the Northwest Ordinance dealing with expansion into Western lands. These were crucial developments in USA history, but the Continental Congress had no other powers and did, and had the power to do nothing else of note thereafter.

Under the Articles of Confederation, each State functioned and viewed itself as a separate sovereign country. The word state has long been used to denote a separate country. The CC had no power over the states, either to pass laws effective in the states, or to impose taxes. Or even to provide for defense after the War ended.

The states were imposing import duties on each other and fighting amongst themselves. Some states were contemplating alliances with other states and even with foreign governments. England had invaded and was maintaining forts in USA territory in the far West. France threatened from the Caribbean, and Spain from the south. The individual states and Confederation Continental Congress had no way to defend themselves against these much stronger powers. There was no central federal government with power to do anything, and everyone was broke. The states had issued currency that devalued virtually to zero, as did the Continental Congress scrip the Continental Army soldiers were paid with. It cannot be overstated how close the USA was to collapse before the Constitutional Convention.

Historians agree that the Republic began with ratification of the Constitution in 1788, and the 1789 election of Congress and the first president, George Washington, who is universally recognized as the USA's first president. The earlier "presidents" who held the gavel and presided over meetings of the Continental Congress had no executive power and are pretty much forgotten. George Washington, beginning in 1789 was, indeed the first President with executive power over a central Federal government with authority to govern all the states.

As a matter of undisputed historical fact, there was no central federal government with any power over the individual states or the country as a whole until 1789.

Because there was no central federal government having any power prior to 1789, I have to disagree that the Fugio copper was a federal issue. There simply was no "federal" at the time of the CC's resolution relating to copper coinage. I do note the use of the word federal in the resolution as it related to weights and measures. I haven't a clue what the word means in that context, but the Federal Government and centralized Republic we know now was not yet in existence.

My personal belief is that the United States of America as a nation began as a Confederation of thirteen self governing states in or somewhat before July 4, 1776. I believe the United States of America morphed into a centralized Republic with actual governing powers at the federal level with adoption of the Constitution. For what it's worth, the Constitutional Framers even grappled over whether the central government should be a Republic.

So that's why I see it the way I do The United States of America has existed since 1776, but it did not have a Federal government until 1789.

*** Edited by Staff - Added paragraphs. ***

If true as described by Sharkman, then we should call it the "Union of America", formed on July 4th, 1776. Only in 1788 was there any semblance of being "United" (with one federal government).
Perhaps the US simply copied the Dutch who, in 1579, formed the "Union of Utrecht" which was an alliance of seven Dutch independent provinces who promised to help each other in their war/defense against the Spanish. Only in 1588 became the Union a fully fledged Republic with a central authority (The "United Provinces of The Netherlands").
Interesting to note is that America basically followed the Dutch at almost exactly a 200 year interval (1579 - 1776, 1588 - 1788).

Where I am taken aback is the lack of transparency as to the rationale behind the decision. The issue at hand is chiefly of a historical matter, and not really about the physical characteristics of the coin itself (other than being able to affirm its identity when referred to in any documents). Given that this matter dates back a good while--an era of America for which many questions are still open--this is closer to scholarly research than basic hobbyist research.

That's not to say that non-academics can't research these topics--they should--but like anyone producing original findings, their process and rationale should be open for scrutiny. We have very little of that from the press release (again, not the typical format of such a topic) given.

Just as this forum allows the public to openly discuss these matters, I believe the best way to move forward is just to shoot PCGS an email asking for an explanation (I would use specific questions to which the answers should address). If they give an answer to the question, we have more insight into their thought process and can continue to proceed. If they can't, while that's not proof that they are wrong, it comes across as suspect.

Perhaps, some people here would be willing to ask them questions? That's the approach I would take if you feel you have an argument against their decision. Personally, I'm curious to see how this goes from here.

I think you gloss over important facts. In 1781, while still fighting the War, the Second Continental Congress created the Department of Finance to manage the national debt, headed by Robert Morris. Although the national debt was apportioned to the states, it was still the national debt and there were many fights, particularly from wealtheir states like Virginia, which Jefferson hailed from, that could better afford the repayment and didn't want to nationalize the debt and Hamilton who fought for the nationalization of the debt. Ultimately Hamilton won.

Shortly after the outbreak of the Revolutionary War, the states issued state currency and the Continental Congress issued Continental currency in the form of paper notes. Both shortly became worthless, but the Congress had the power to issue money and did so in large amounts. The failure of the Continental currency was in large part because the Continental Congress did not have the power to tax, generate revenue and therefore stand behind the issuance of its currency.

In 1783, Congress gave itself the power to tax to cover the government's costs which ended up falling short mostly because of the overhang of $43 million in national debt borrowed from France and the Netherlands primarily to fight the Revolutionary War.

There was clearly a national government in the Constitutional Congresses with the power to tax, issue money, contract to coin money and ratify a Constitution. Well before 1787 when the Fugios were contracted to be coined and came into existence.

The Continental Congresses had all the power necessary to bring about all the changes the States agreed to in our nation.