The Portland daily press., 1897-02-01

How the Greenback Came Into Exist
euce.
The sese.e illness Of Elbridge Gerry
| Spaulding, known in the history OF this
cauutry as fhe father of the green
| back, the recent reeo .nmendaticn OF Mr..
| Eckels, comptroller Of the currency, that
tbs government retire all TINT kind OF
money, and the sui sequent recommends
the same effect, make it interesting to
| recall how tho greenback came into ex-
istenoe.
The generation that elected Abraham
Lincoln President Of the United States
did not know the greenback-in fact had
tnorized by Congress and the notes of
the State tanks. These were not
sufficient to the needs Of the country in
| war times, however, and several new
kinds Of paper money became necessary.
They were the "demand notes." the
"seyen-thirties, the "postage curren-
cy," the fractional currency" and fl
naliy the illegal tenders" or "green-
backs" all Of which were tried AMI
made necessary by the money demands OF
| the war.
| Mr.. Spaulding was the "father" of the
creenback measure and its most ardent
supporter, although expressing mis- dis
approval of that kind of money in any
other times than those of war. AS the
country didn't have the gold, he said, it
must make money out of it's credit, and
the areenback was the result. 1t was q
peculiar lot of money that was in use at
that time.
The treasury notes authorized by stat
utes in forcs in March, 1851, did not cir
culate as money. They were not issued in
denominations of less than $50, were pay
able one year after Date and bore FER
cent interest. Mr.. Chase, the Secretary
OF the Treasury, sold about Sc, 200, 600 Of
these notes at par by offering with them
like amount of bonds at per cent and
on twenty years time. These amounts
relieved the wants of the Treasury but
little, and had no appreciable effect on
the circulation of the country.
| 1t became apparent, however, that some
provision must be made for paying the
army, and Secretary Chase recommended
and Congress authorized the immediate
issus of treasury notes to the amount
Of SEQ, coo, 000 in denominations OF not
less than $40 and payable on demand
without interest. Later q supplemental
act was passed authorizing the issue OF
denominations ms low as S. and making
them receivable for public dues. Being
receivable for duty, tie notes, which
we're known as "demand notes" had al
most the equivalent in value OF gold.
They we're used to pay off the soldiers,
relieved the pressing needs Of the Treas
ury and aided greatly to the money cir
culation Of the country.
In February, 1862, the passage of the
legal tender act, which required that du-
ties be payed in gold in order to pro-
vide gold for the rayment of the funded
debt, made it necessary to redeem and
onrcel those s'denand notes." because rs
lDng rs gLey were outstanding they
would take the place Of an equal amount
Ct gol 1.
Tho AIT Of July, 1851. which Authorized
the issue Of the demand notes, au-
thorizad also the Issue OF treasury notes
to bepr interest at tho rate OF $40 per
cent. TEcss notes becnme known as
| tssey en-thirties' from their rate Of inter-
est, which, at cent per day fer $50, it
vas hoced from its convenience of oom-
putation, would give the notes some cir
ouIation. THAT hope, however, was not
realized.
SHINPLASTERS AND POSTAGE
CURRENCY.
Suspension of specie payment by the
banks in the latter part Of 1861 caused
such boarding of gold and limited the
circulation Of the country to such an OK
tent that great Inconvenience was felt in
business. 1t became almost impossible
to make change in ordinary business
purchases. It was then that "shinplas-
ters'' began to make their appearance,
which in some states were issued not
only by individuals and corporations
but by states, counties and towns.
It was to General Francis E. Spinner,
Treasurer of the United States. that cred
it was due for finding a way out of the
dilemma, He had found it almost I'M
possibls to pay off the soldiers and sailors
and conduct the business of the Treasury
with the small amount of coins at hand.
He therefore made m arrangement with
the Postoffice Departmental redeem in
unused stamps such postage as Nigh
lie used for currency. His department
manufactured and introduced the new
issue. All the denominations were of the
same size. A piece Of paper with one