Introducing the Greenback

To introduce you to the topic of Greenback America, I would like to take you on a small tour of an even smaller monument of the Civil War Era—the American dollar. Americans today are increasingly living in a cashless world, but if you can, grab a dollar and follow along.

The first things you might notice are the physical aspects of the note–especially with a new note. The US dollar has a distinctive green hue and a feels like no other piece of paper. It even has its own smell. The second thing that pops out is its iconography—meant to convey a sense of US nationalism. The notes are also sites for Americans to commemorate and remember the past. We all witnessed this process this last spring when the US Treasury made a historic decision to replace Andrew Jackson’s portrait with one of Harriet Tubman on the $20 bill. Together, these different dimensions of the notes convey a distinctly American sense of wealth and value. These are all critical parts of understanding these slips of green paper—but the connection between the Civil War and the note in your hand requires that we look at a few less obvious parts of the bill.

Over shadowed by the intricate art work, security features, and the face of a long dead president is a direct command by the government to you and whomever you might give the note to. It reads, “This note is legal tender for all debts, public and private.” This might strike you as self-evident. Who would not accept a good dollar in payment for a coffee or sandwich? (A few people it turns out, but that’s a story for another time). The key here is how we conflate the idea of a dollar with this green paper.  A dollar is just a word. Different generations of Americans have defined the word in different ways, and the definition tells us a lot about people’s ideas about power, the government and its relationship to the national market and everyday life.

To the generation that fought the Civil War the idea of a “dollar” brought up images of gold and silver coins—not a pile of greenbacks.  The US government first created what we might call the modern dollar, a dollar that is not backed by gold—what economists call “fiat currency,” during the American Civil War. To a generation accustomed to gold, a green dollar was cheat, swindle, or worse by a government pushed to the brink by a war that was growing in cost by the day. Yet not everyone loved the gold dollar. Due to their scarcity most Americans never used gold in their daily lives and instead depended on notes issued by banks of varying quality and reputation to provide for their cash needs. To these Americans, greenbacks promised a new era in which the federal government could use its powers to create safe, reliable, and more equitable country.

In future posts, I’ll talk about why Congress took this monumental step in the winter of 1862, but here in this first post I would like to highlight this particular theme of our exhibit. These Civil War greenbacks, of which you hold a direct descendant in your hand, are a symbol of the transformation of national power fostered by the war. After generations of operating “out of sight,” the federal government was now thrusting these slips of green paper into the hands of millions of Americans—a decision that touched every person in the cash economy. In turn, that decision transformed the nineteenth-century American economy, the size and powers of the federal government, and even the nature of national politics. Today’s headlines are filled with debates about how to use or not use national power to cure America’s economic problems. What we hope to share with you in Greenback America is the unexpected and sometimes surprising story of how the Civil War made that possible by creating a national economy and federal state that were and are critical parts of modern American life.