The Growth of the American Economy: An Introduction to the Economic History of the United States

By Robert G. Albion; Harold F. Williamson | Go to book overview

CHAPTER 27
Money and Banking Since 1860

The Greenbacks1

THE OUTBREAK OF THE WAR BETWEEN THE STATES in April, 1861, found the United States with a monetary structure consisting of standard gold coins, subsidiary silver and minor coins, and the note issues of some 1,600 state banks. Although, legally, the country was on the bimetallic standard, the mint ratio of 16 to I undervalued silver sufficiently to keep the full-weight silver dollar out of circulation.

The paper currency provided by the state banks was of all degrees of goodness. Some of it was accepted at par over a wide area, but a great deal of it was of such questionable value that it was subjected to a heavy discount when circulated at any considerable distance from the place of issue. Much of it was backed by the bonds of Southern or border states; and when the South seceded from the Union, the value of this security shrank seriously, with the result that banks failed by the wholesale and the volume of worthless currency outstanding decidedly increased.

President Lincoln had assigned the important post of Secretary of the Treasury to Salmon P. Chase, a former governor of Ohio, and United States senator from that state. Mr. Chase was a lawyer of ability, but had had no practical experience in finance. The administration had fallen heir to a bad fiscal situation. The large deficit and weak national credit which the new secretary found made his task all the more difficult.

Much criticism has been leveled at Secretary Chase for his policy of borrowing and of issuing paper money instead of inaugurating immediately a rigorous system of taxation. Granting that a war should be financed as much as possible by taxation, as little as possible by borrowing, and not at all by fiat paper money issues, the situation that confronted the Treasury during the first two years of the war must be considered before judgment is passed on it.

In the war's early stages the North, blindly confident that the "rebellion" could be put down in a few months, held out against the slow and unpopular device of taxation. Furthermore, the administration was

____________________
1
For a comprehensive treatment, W. C. Mitchell, A History of the Greenbacks ( Chicago: University of Chicago Press, 1903), and D. C. Barrett, The Greenbacks and the Resumption of Specie Payments, 1862-1879 ( Cambridge: Harvard University Press, 1931), are recommended.

-632-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this book

This book has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this book

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited page

Bookmark this page
The Growth of the American Economy: An Introduction to the Economic History of the United States
Table of contents

Table of contents

Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
/ 810

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

    Already a member? Log in now.