By Jay Turner - May 31, 2022
In the late 1970s, the United States had not produced a gold coin since 1933, and the demand for gold as a hedge against inflation was unprecedented. In 1977, inflation for the year reaching 6.50%, the importation of the South African Krugerrand reached 1.6 million coins. The United States, seeing the imbalance of trade with the importation of gold bullion, looked for a solution to address its domestic demand for gold. That temporary solution would be the American Arts Commemorative Medallions.
The United States had abandoned the gold standard for redeeming dollars for gold in 1971. This abandonment was controversial and was one of several economic factors that over the next decade led to some of the highest rates of inflation in United States history. Many looked to gold as a safe haven to protect their wealth against the rising inflation. On April 19, 1978, the United States Treasury Department announced a portion of the national gold stockpile would be sold through the General Services Administration (GSA), with the unit being 400 troy ounce bars. The size and value of such bars was unrealistic for normal American citizens to be able to buy United States gold. This size transaction would be almost exclusively for foreign governments, bankers, and gold dealers.
Senator Jesse Helms introduced the Gold Medallion Act of 1978, which forced the use of 1.5 million ounces to be made into medallions fit for sale to the public. However, Helms’ proposal was for a piece featuring the Capital and the Great Seal of the United States. It would be Iowa Congressman Jim Leach that would propose a series featuring and honoring American artists.
Fresh in the minds of legislators of the day were the recent changes to the design of the circulating dollar, which saw a reduction in size and a significant redesign. All of this had been debated in Congress in 1978 with a proposed Miss Liberty design for the dollar being changed to a portrait of Susan B. Anthony. This was all current with the legislators, some of whom wished to see a representatives of arts and culture on the coin. With bill H.R. 13567, the suggestion of 10 individuals who had been distinguished by their contribution to the arts be used. Congress supported the bill, and it was attached to the omnibus bill that President Jimmy Carter signed on November 10, 1978.
Production of the medals was done at the West Point Bullion Depository. The first issues were produced in 1980 in two sizes: a one-ounce medal featuring Grant Wood, an American artist, and a half-ounce showcasing American singer Marian Anderson. Both medals were minted in 90% gold. The cost of the medals would be the price equal to the free market value of the gold plus the cost of manufacture and marketing costs. The failure was in the sales, which required an individual to call a telephone number to get the day’s price of the medal, then that same day go to the United States Post Office and buy a postal money order for that price, then mail it that same day to purchase the medals. This would coin the term “Postal Gold” for the series.
Despite the cumbersome purchase methods, the 1980 one-ounce Grand Wood medal sold 312,709 units of the 500,000 minted, while the Marian Anderson piece sold 281,624 of the 1,000,000 minted. Due to the poor sales, the Mint announced a partnership with commodity traders J. Aron Company, which would market the medals. This opened sales of the medals through bullion dealers, banks, coin dealers, and brokerage houses, similar to the way South Africa distributed the Krugerrand in the United States.
The 1981 issues, which feature American author Mark Twain on the one-ounce issue and author Willa Cather on the half-ounce medal, saw some changes. While the medals remained 90% gold, the 10% balance of the alloy was changed to silver and tweaked the color of the medals. This alloy of 90% gold and 10% silver remained for the rest of the series. This was done to change the composition from the federal gold coinage struck until 1933. The medals saw more changes in 1982 with musician Louis Armstrong on the one-ounce medal and architect Frank Lloyd Wright gracing the half-ounce pieces, which now saw the addition of a denticle design border around the rim and a reeded edge. The inscriptions "ONE OUNCE GOLD" or "ONE HALF OUNCE GOLD" were added to the medals to finally denote the metal and content.
The 1983 designs of poet Robert Frost for the one-ounce medal and sculptor Alexander Calder on the half ounce were followed up by the last of the series in 1984, when actress Helen Hayes appeared on the ounce-ounce medal and author John Steinbeck hit the half-ounce entry. The United States Mint would terminate their contract with J. Aron Company in 1984 and returned to the telemarketing program. Sales ended on December 31, 1985.
Despite the demand for gold bullion, the series was never popular nor sold out of its ever-declining mintage, with 1984 seeing an official mintage of only 35,000 pieces for each size. Criticism of the program began in 1980 with such sticking points as the lack of weight, fineness, or even country of origin on the medals. While the weight and metal were added to the medals in 1982, they still were not coins, a problem that many said hindered the sale of the pieces. Others criticized the poor advertising and the difficulty in buying them from the post office. To contrast this, the 1984 Summer Olympics Commemorative coin program was a huge success, seeing the gold commemorative coinage sell out.
In 1985, President Ronald Regan banned the import of Krugerrands due to the South African apartheid policy. The 1986 Statue of Liberty $5 commemorative sold out in advance of the program. The 1986 gold and silver American Eagle programs effectively served as the replacement for the American Arts series, fixing the complaints and mistakes the medallions carried and as a result achieved great success from day one.
If you want to collect bullion the American Arts Series, it is an interesting choice for its history and diversity. Today the American Arts or “Postal Gold” series often trades close to bullion prices. However, these pieces remain unpopular with the general public some 40 years later. It is unknown how many of these medals have been melted for the bullion content over the years. Putting together a full set would just take some money. Yet, putting together a high-grade set would prove challenging. It can be very difficult to find any in a high grade. At PCGS, the 1980-1981 issues have the highest grade of MS68, while just 15 MS69 pieces have been graded for all the 1982-1984 medals. A complete collection would entail 7.5 ounces of gold, representing a wonderful assemblage of the American Eagle predecessor.
