What’s behind the Greenback?
It became clear to President Abraham Lincoln in 1861 that the War Between the States was going to be both costly and lengthy. So, how was the U.S. government going to pay for the fight to save the Union?
Prior to the war, only gold and silver coins were legal tender. Paper bank notes were privately issued by banks and redeemable for gold and silver but could easily become worthless if an individual bank failed.
Lincoln turned to his Secretary of the Treasury, Salmon Portland Chase, to find a way to fund the Civil War.
Originally from New Hampshire, Salmon P. Chase had moved west and practiced law in Cincinnati, Ohio. He was a a staunch abolitionist and devout Christian. Moving into politics, Chase was known as the “Attorney General for Fugitive Slaves”. He also attempted to start a new political organization, the Liberty Party, before joining forces with the Republican movement growing in influence in the northeastern states. Chase used his considerable influence in the Republican Party to fight for the end of slavery.
In 1860 as a Senator from Ohio, Chase served only a shot time before accepting Lincoln’s nomination to become Secretary of the Treasury. After the failing of talks to avoid secession, Chase was tasked with the daunting challenge of how to finance the inevitable costs of war between the North and South.
It was clear to Chase that the limited revenue coming from tariffs and excise taxes would not be enough to fund the mounting costs of the war and aside from having the federal government take on high interest loans from private banks, the war effort would soon fail.
On February 25, 1862, at the urging of Lincoln and Chase, Congress passed the Legal Tender Act. The legislation authorized the United States to circulate paper notes as legal tender throughout America. This new legal tender, not redeemable for gold or silver, was derisively dubbed “greenbacks” due to the green ink on the back of each note. Ultimately, the U.S. government would print more than $400 million to finance the war.
Salmon P. Chase is also credited with having the statement, “In God We Trust” adorn U.S. coins beginning in 1864.
President Lincoln appointed Chase to the Supreme Court where he served with distinction until his death in May of 1873. As Supreme Court Justice, Chase admitted the first African-American, attorney John Rock, to argue a case before the Supreme Court. Following Chase’s death in New York in 1873, his colleagues on the Supreme Court established the tradition of draping the chair of the deceased Justice’s seat with black crepe. In addition, Chase’s memory was honored by having his image engraved on the $1,000 bill. The Chase National Bank (now JP Morgan Chase) was named in his honor.
Certainly, Salmon Portland Chase lived a life of priceless service. He championed the cause of liberty, unity and freedom for every man. Let us remember the accomplishments and service of this remarkable man by his won words – “The law of the Creator, which invests every human being with an inalienable title to freedom, cannot be repealed by any interior law which asserts that man is property.”
It is cited in many publications that Salmon P. Chase was also a Freemason and active in Midwestern lodges but the GDM Museum has not found any publication stating the name and number of his home lodge.
