Two Cents Worth Collecting
BY PAUL GREEN
They may not be widely collected as is typical of denominations no longer in use, but realistically, a collection of U.S. two-cent pieces is well worthwhile both in terms of good value and good stories. As a collection from the 1800s, the two-cent piece is a great one for collectors today.
What would certainly surprise many is that the two-cent piece was actually not a new idea back in 1864 when the first one was minted. In fact, the idea for a two-cent piece had been around for some time. There was no mention of the denomination back in 1792 when the first coins of the United States were authorized, but in 1806, a member of Congress actually proposed a two-cent coin made of billon, an alloy of copper and silver which was being used in Europe at the time. The two-cent piece might have been approved then were it not for the opposition of the Mint Director Robert Patterson, who pointed out that the alloy might cause problems, especially if there was a need at some point in time to recover the silver.
Over the years, things began to improve at the U.S. Mint. There were new machines and new metal supplies, which were followed by the opening of branch mints in Georgia, North Carolina and Louisiana. These factors made it possible to think that finally there was light at the end of the tunnel in terms of the national coin shortage and the use of foreign coins.
Under those circumstances, it was possible once again for people to get ideas. This time, however, it was not merely a member of Congress, but rather Secretary of the Treasury Robert M. Patterson, who, ironically, was the son of the man who back in 1806 had played a critical role in the defeat of the idea of a two-cent piece. The younger Patterson ordered Christian Gobrecht to make patterns of a proposed two-cent piece. Today, we’re not sure whether Patterson was actually simply trying to please someone with influence, or whether he had some interest in the idea himself, although it is believed he was an unlikely person to support the idea. Whatever Patterson’s real motives, the idea once again ended up on the back burner.
There were, however, forces at work that would see a third time being the charm for the two-cent piece. In the mid-1850s, with the introduction of a Flying Eagle cent, the old idea that a coin had to be worth close to its face value in the metal it contained was finally put to rest. In the past, that idea had been a major problem for the two-cent piece, as there were already problems with the size of the large cent, and the two cent piece, if made of the same alloy, would be twice as large. With the acceptance of smaller cents, that concern changed. Once concern over the metallic value was removed, there were more options for a denomination like the two-cent piece.
The Civil War would prove to be another factor. The hoarding which began almost with the firing of the first shot was not surprising. In troubled times, Americans had resorted to hoarding in the past. In fact, hoarding had been something of a national sport for assorted reasons, including in the 1830s when gold coins, and the 1850s when silver coins, were too valuable. However, in the 1860s, the hoarding was based on uncertainty over the outcome of the war, and with good reason, as the northern forces had been less than brilliant in early battles. That made the future look bleak for Lincoln and the Union. So people not only hoarded the usual, gold and silver, but even copper-nickel cents.
It was clearly a crisis. Secretary of the Treasury Salmon P. Chase was at the center of that crisis, but he was hardly alone. One willing helper was a fellow by the name of James Wharton, who was basically a lobbyist from Pennsylvania. Wharton felt the answer to virtually all of the nation’s problems could be found in the use of copper-nickel coins. There was good reason for his pushing this idea – he just happened to own the only operating nickel mine in the United States. He cheerfully proposed virtually all denominations be struck in copper-nickel, but his cause may have been hurt slightly by the fact that people were even hoarding copper-nickel cents. Under the circumstances, he was not going to get every denomination in copper-nickel, and in fact, the composition of the cent was changed from copper-nickel to bronze, which could not have made him happy. An identical composition was proposed for a new two-cent piece, while new three- and five-cent coins were proposed in copper-nickel.
It was an elaborate set of changes, but the situation had gone from bad to worse. Americans were making change with tokens, postage stamps and fractional notes, along with an assortment of less official possibilities too numerous to mention.
The nation needed a lot of lower denominations quickly, and the two-cent piece was authorized in April of 1864, but its production was stalled slightly while the new bronze Indian Head cents were produced. A number of patterns for the new 2¢ denomination were created, including one of George Washington, but the final selection was a Shield and Scroll obverse, which would quickly be modified and used on the new nickel as well.
One design feature was special. A man from Pennsylvania by the name of Mark Watson had written the Secretary of the Treasury, noting that there was no mention of the almighty on the coins. At a time such as the start of the Civil War, the suggestion of adding some mention of God was likely to receive a better than normal reception, and it did. Chase agreed and ordered that some phrase which became "In God We Trust" be added when possible to U.S. coinage. The first time that would prove to be possible was the new two-cent piece, making it the historic first coin to carry the motto.
There is no doubt that things were rushed in 1864. The new bronze Indian Head cent was introduced and followed by the production of nearly 20 million of the new two-cent pieces, followed in later years by the new three- and five-cent coins. As oftentimes happens when there are changes, especially hurried changes, at the Mint, there are small problems. Some of the 1864 two-cent pieces appeared with a smaller motto. What is suspected is that some pattern dies with the smaller motto were used. This resulted in small totals of the Small Motto 1864, which are much tougher to find than the Large Motto variety.
As Proofs were produced at the same time, even a Large Motto Proof is tough. In fact, the Large Motto is more expensive than any other Proof, except for the Proof-only 1873, which is thought to have had a mintage of 1,100, and the 1864 Small Motto. The historic belief is that the 1864 Small Motto Proof had an extremely low mintage, with perhaps fewer than 20 known today, including those in museums and others that have been mishandled. At NGC, they have seen just 6 examples, with 4 of the 6 reaching Prf-65 or better. The PCGS total is 9 coins, of which 4 have reached Prf-65 or better, and some suspect the total number surviving is perhaps closer to 15 pieces than 20.
Ironically, the politics which produced the two-cent piece are seen by some as hastening its demise. Because when three- and five-cent coins, which contained no silver, began to circulate, the need for the two-cent piece definitely decreased. In just its second year of production, the mintage of two-cent pieces dropped close to 14 million pieces, and in the years that followed, the total drifted lower virtually every year, dropping below 1 million pieces in 1870, then to 721,250 in 1871, and just 65,000 in 1872, before the final Proof-only mintage in 1873.
The lack of large numbers of date collectors can be seen in the prices, as basically, the years with mintages of at least one million are very similar in price whether the date had a mintage of 14 million or barely 1 million. The 1871 and 1872 with their significantly lower mintages are more, but another factor which must be considered is that it is the belief that with a copper shortage during the early 1870s, many two-cent pieces may have been melted to produce cents, which were in much more active use. That would make any two-cent piece potentially better than their already low mintages suggest, especially the 1872, which, while still inexpensive when you consider, is significantly more expensive than the others.
Even in Mint State, the prices remain close. The lower mintage 1870 and 1871 are more than the others, while the 1872 with its 65,000 mintage is in a class by itself. A lower-priced alternative for some dates can be found in Proofs, which are available in some cases for less than a Mint State example, and that is true for the tough 1872.
The low price in Prf-65 of the 1872 reflects a situation which is actually typical for most years, in that at the time, many collectors would simply acquire a Proof each year and not a business strike. That was especially true of collectors living in the Philadelphia area, and although Proofs would generally have low mintages, the fact that they were purchased by collectors meant far better care. That has resulted in much better survival rates, seen in many cases like the 1872, where the Proof is actually much less expensive than an MS-65.
The final two-cent piece was the Proof-only 1873, and it has been the subject of some debate over the years. The 1873 is thought to have had a Proof mintage of roughly 1,100 pieces, and they seem to come in nearly equal numbers with either an open or closed "3".
The contention of some has been that the Open "3" was a restrike, and that is certainly possible. There may, however, be another reason for the situation, and that is that at the time, there were two different Proof Sets offered each year, with one being a so-called "nickel" set, which included only minor issues. It is thought that perhaps 500 of these so-called "nickel" sets were sold in 1873 along with another 600 silver sets, which contained silver coins as well as minor issues. As the Open and Closed "3" are both at roughly the same price in Prf-65, and as the sales of the two types of sets were also similar, the possibility must at least be considered that the two-cent piece in one set was the Open "3", while the coin in the other had a Closed "3". Whether that was the case, or a restrike, the 1873 remains an interesting date.
The 1873 raises an interesting point, in that the two-cent piece is one of very few denominations of which it is actually possible to have a complete collection in Proof. The 1864 Small Motto would certainly be a problem, but otherwise, only the 1864 Large Motto and 1873 are better, and most of the others are less expensive. Certainly, a collection in Proof is not in the budget range of many, but for a lucky few it is possible, and with so few other denominations being possible in Proof, it makes for a unique collection from the period.
Although it is relatively easy to overlook the two-cent piece today, that would be a shame. It is a historic denomination which had an important role in circulation for a brief period of time. At today’s prices, it is also a great value for an interesting and unusual collection from the 1800s.