President’s Day 2003
by Amarks. February 17, 2003
George Washington February 22, 1732 - December 14, 1799
"A wagonload of currency will hardly purchase a wagonload of provisions."
Abraham Lincoln February 12, 1809 - April 15, 1865
His troops found a better use for paper money, lining their worn out boots.
Revolutionary War Currency
These first US currencies set a precedent for the first national currency. To finance the Revolutionary War, the Continental Congress in 1775 authorized the limited issuance of paper currency. These notes, called Continentals, were denominated in dollars and backed by the "anticipation" of future tax revenues, with no backing in silver or gold. They could be redeemed only upon the independence of the American colonies from Britain.
Without solid backing and with rising inflation, the Continentals soon became worthless, thus the expression "not worth a Continental." Or, as George Washington put it, "A wagonload of currency will hardly purchase a wagonload of provisions."
The remnant of this experience was a deep distrust of paper money which was not issued again by the US government until the Civil War. The Continental marked the first time that the worth of U.S. currency lay in its purchasing power and not in its intrinsic value. From San Francisco FRB... Back in Revolutionary War times, you can just imagine a "wagonload" of currency having to be rolled in to pay the troops, which would literally not pay for the provisions the troops needed to survive. FWIW, things did not fare much better under Lincoln and the Civil War where paper currency was better put to use in lining your boots than apparently anything else you could buy with it.The need to use metals for war purposes created a shortage of coins during the Civil War and led to the circulation of small change substitutes. From 1862 to 1876 the government issued $368 million in Fractional Currency in three-to-fifty-cent denominations. These "paper coins," much smaller in size than our present currency, were nicknamed "shinplasters," as the hardships of war often forced troops to line their worn-out boots with them.
FWIW: here are some background links for those interested:
© 2003 Amarks
Amarks | Dallas, TX, USA