Like Henry VIII[1] this group’s morals couldn’t get any lower so let’s discuss another definition:

Debase: To reduce in quality or state; impair the purity, worth, or credit of; vitiate; adulterate.

As we’ll see later, Henry VIII scores here too!

In my never-ending quest to promote coin collecting I like to ask kids[2] the question, “What makes money valuable?” The response is always, “Because it’s money!” which these days is a correct answer.[3] Money is valuable because it’s money. The government says so.

But then I say, “Money used to be valuable because it was made of valuable metals.”, give the kid a flip with a 1964 quarter in it,[4] and say, “This old quarter is made of real silver.[5] It’s worth more than four dollars![6] Keep it as a treasure and don’t spend it.[7]”

Since 1965 U.S. quarters have been made from an alloy of 75% copper and 25% nickel sandwiching a 100% copper core.[8] While this is technically debasement it’s not the morally impaired kind of debasement described below. There was no attempt to fool the public into thinking that that the new quarters were still made of silver.

A classic example of debasement is what happened to the Imperial Roman “denarius” which over a period of 450 years fell from 95% silver to nearly zero. The decline of the coin was both a cause and an effect of the decline of the Roman Empire.[9]

A denarius from the reign of Emperor Tiberius. He actually increased the silver percentage.

The denarius was about the diameter of a U.S. dime and was originally the unskilled laborer’s daily pay. It is an example of hard currency, valuable because of the value[10] of the metal with each coin’s weight and purity guaranteed by the government.[11]

The core lands of the Roman Empire were not particularly rich in gold and silver ore. Precious metals had to be imported but that was easy to do when the Empire was expanding. Some of the first big Roman projects in the barbarous isle of Britannia were lead mines for the extraction of silver.

But when expansion slowed, new sources of plunder and ore dried up while the expense of defensive armies on the frontiers did not. Popular exotic consumer goods from the East could only be purchased with silver leading to a net outflow of hard currency.

Imperial currency production had to be maintained despite a shortage of bullion. Lacking money printers that go brrrrr! there was only one other solution.

The debasement of the denarius was a slow thing. Every Emperor who did it undoubtedly thought, “It’s just a little bit.” but there were a lot of Emperors. Like going broke, it first happened slowly and then happened quickly. The fiction of a hard currency couldn’t be maintained. Soldiers demanded pay raises to compensate and threatened to turn around and re-conquer the homeland if they weren’t granted. Those Easterners and their damn assayers wanted more of the debased coins for their exotic consumer goods. The only way for the Imperial Mint to satisfy demand was to debase harder. It turned into a classic hyper-inflationary event that destroyed the Imperial economy.

Here’s a chart of the debasement of the denarius:

From the Wikipedia article on the denarius. Doesn’t show the fall to zero.

Another example of debasement is the English “testoon” during the reign of Henry VIII. Henry did quite a lot of things to raise royal revenue[12] but war expenditures still outweighed income and in just seven years the coin, worth 12 pence[13], was reduced from 92.5% silver, to 50% silver, to 33% silver with a pure silver coating. The alloying metal was copper. The silver coating tended to rub off on areas high relief, like Henry’s nose, revealing the copper/silver alloy underneath giving the King the nickname “Old Copper Nose”.

When the silver standard was later restored the word “testoon” had the connotation of debasement so the new 12 pence coin was called a “shilling”.

A King Henry VIII “Old Copper Nose” testoon. Same as the featured image.

The U.S. has always been forthright about its coinage debasement. In 1853 the weight of silver coins[14] was reduced by seven percent. This made the value in silver less than the face value of the coin and ended the mass melting down of the previously overvalued coins. The new coins were struck with arrows around the date to indicate the new weight.

An 1853 quarter with arrows at the date.

Footnotes:[15]

[1] Two Kings of England after me, those assholes.

[2] When I’m allowed to be near them.[16]

[3] A more correct answer is that the government accepts it for tax payments but I don’t expect kids to know that.

[4] I told you I’m promoting coin collecting.

[5] Actually 90% silver and 10% copper.

[6] $4.37 at the time of this writing.

[7] And then get the quarter back in change the next day. Stupid kids.

[8] For a melt value of 5.7 cents. The melt value of a nickel is actually more at 6.7 cents.

[9] The historical statements and opinions expressed here are my own and do not necessarily reflect those of the Glibertarian Foundation, the administrators of this web site, or the actual historical record for that matter.

[10] Yes, this just kicks the question of “Why is it valuable?” up a level but I’ll leave the deep philosophical discussion for the commentariat.

[11] You anticipate me sir!

[12] Like sacking all the monasteries.

[13] A pound sterling is 20 shillings or 240 pence.

[14] Other than the silver three cent piece which was already debased and the silver dollar which didn’t circulate inside the U.S. at the time.

[15] This article was solicited by Tonio. What on earth did he expect?

[16] This is a joke. Besides “Old Man With Coins” lacks a certain panache.