Early American currency
Early American currency went through several stages of development during the colonial and post-Revolutionary history of the United States.
Because few coins were minted in the
During the
Colonial currency
There were three general types of
Cash in the Colonies was
One by one, colonies began to issue their own paper money to serve as a convenient
The oldest surviving bill bears the date "February 3, 1690"[6] and was for 20 Massachusetts shillings, equivalent to one pound [7]
However, as the colonies began printing their own money, location-based socio economic issues soon followed. Most of these concerns were rooted in each colony having different values of the dollar, which made any inter-colony transactions a confusing mess. By the time Parliament decided to prohibit the printing of paper money in the colonies, their hired counterfeiters were able to take advantage of the common people, widening the gaps between socioeconomic classes.[citation needed]
The paper bills issued by the colonies were known as "bills of credit". Bills of credit could not be exchanged for a fixed amount of gold or silver coins upon demand, but were redeemable at a time specified in the future.[3][8] Bills of credit were usually issued by colonial governments to pay debts. The governments would then retire the currency by accepting the bills for payment of taxes. When colonial governments issued too many bills of credit or failed to tax them out of circulation, inflation resulted. This happened especially in New England and the southern colonies, which, unlike the Middle Colonies, were frequently at war.[8] Pennsylvania, however, was responsible in not issuing too much currency, offering an example of a successful government-managed monetary system. Pennsylvania's paper currency, secured by land, generally maintained its value against gold from 1723 until the Revolution broke out in 1775.[9]
This
Another Currency Act, in 1764, extended the restrictions to the colonies south of New England. Unlike the earlier act, this act did not prohibit the colonies in question from issuing paper money but it forbade them to designate their currency as legal tender for public or private debts. That prohibition created tension between the colonies and the mother country and has sometimes been seen as a contributing factor in the coming of the American Revolution. After much lobbying, Parliament amended the act in 1773, permitting the colonies to issue paper currency as legal tender for public debts.[11] Shortly thereafter, some colonies once again began issuing paper money. When the American Revolutionary War began in 1775, all of the rebel colonies, soon to be independent states, issued paper money to pay for military expenses.
Thirteen Colony set of United States Colonial currency
The
Colony | Value | Date | Issue | First[nb 3] | Note (obv) | Note (rev) | Signatures |
---|---|---|---|---|---|---|---|
Connecticut | 40s (£2) | 1775-01-02 | £15,000[14] | 1709[15] | Elisha Williams, Thomas Seymour, Benjamin Payne[nb 4] | ||
Delaware | 4s | 1776-01-01 | £30,000[17] | 1723[18] | John McKinly, Thomas Collins, Boaz Manlove | ||
Georgia | $40 | 1778-05-04 | £150,000[nb 5] | 1735[20] | Charles Kent, William Few, Thomas Netherclift, William O’Bryen,[nb 6] Nehemiah Wade | ||
Maryland | $1 | 1770-03-01 | $318,000[23] | 1733[24] | John Clapham, Robert Couden[nb 7] | ||
Massachusetts | 2s | 1741-05-01 | £50,000[26] | 1690[27] | Robert Choate, Jonathan Hale, John Brown, Edward Eveleth | ||
New Hampshire | $1 | 1780-04-29 | $145,000[28] | 1709[15] | James McClure, Ephraim Robinson, Joseph Pearson,[nb 8] John Taylor Gilman (rev) | ||
New Jersey | 12s | 1776-03-25 | £100,000[30] | 1709[31] | Robert Smith, John Hart, John Stevens Jr. | ||
New York | 2s | 1775-08-02 | £2,500[32] | 1709[33] | John Cruger Jr., William Waddell[nb 9] | ||
North Carolina | £3 | 1729-11-27 | £40,000[35] | 1712[36] | William Downing,[nb 10] John Lovick,[nb 11] Edward Moseley, Cullen Pollock,[nb 12] Thomas Swann[nb 13] | ||
Pennsylvania | 20s (£1) | 1771-03-20 | £15,000[40] | 1723[41] | Francis Hopkinson, Robert Strettell Jones, William Fisher[nb 14] | ||
Rhode Island | $1 | 1780-07-02 | £39,000[43] | 1710[44] | Caleb Harris, Metcalf Bowler,[nb 15] Jonathan Arnold | ||
South Carolina | $60 | 1779-02-08 | $1,000,000[46] | 1703[47] | John Scott, John Smyth, Plowden Weston[nb 16] | ||
Virginia | £3 | 1773-03-04 | £36,384[49] | 1755[50] | Peyton Randolph, John Blair Jr., Robert Carter Nicholas Sr.(rev) |
Continental currency
After the American Revolutionary War began in 1775, the Continental Congress began issuing paper money known as Continental currency, or Continentals. Continental currency was denominated in dollars from $1⁄6 to $80, including many odd denominations in between. During the Revolution, Congress issued $241,552,780 in Continental currency.[51]
The Continental Currency dollar was valued relative to the states' currencies at the following rates:
- 5 shillings – Georgia
- 6 shillings – Connecticut , Massachusetts, New Hampshire, Rhode Island, Virginia
- 71⁄2 shillings – Delaware, Maryland, New Jersey, Pennsylvania
- 8 shillings – New York, North Carolina
- 321⁄2 shillings – South Carolina
Continental currency
Another problem was that the British successfully waged economic warfare by counterfeiting Continentals on a large scale. Benjamin Franklin later wrote:
The artists they employed performed so well that immense quantities of these counterfeits which issued from the British government in New York, were circulated among the inhabitants of all the states, before the fraud was detected. This operated significantly in depreciating the whole mass.[56]
By the end of 1778, Continentals retained from 1⁄5 to 1⁄7 of their face value. By 1780, the bills were worth 1⁄40 of their face value. Congress attempted to reform the currency by removing the old bills from circulation and issuing new ones, without success. By May 1781, Continentals had become so worthless that they ceased to circulate as money. Franklin noted that the depreciation of the currency had, in effect, acted as a tax to pay for the war.[54][52]
For this reason, some Quakers, whose pacifism did not permit them to pay war taxes, also refused to use Continentals, and at least one
After the collapse of Continental currency, Congress appointed Robert Morris to be Superintendent of Finance of the United States. Morris advocated the creation of the first financial institution chartered by the United States, the Bank of North America, in 1782. The bank was funded in part by bullion coins loaned to the United States by France.[58] Morris helped finance the final stages of the war by issuing notes in his name, backed by his personal line of credit, which was further backed by a French loan of $450,000 in silver coins.[59] The Bank of North America also issued notes convertible into gold or silver.[60] Morris also presided over the creation of the first mint operated by the U.S. government, which struck the first coins of the United States, the Nova Constellatio patterns of 1783.[61]
The painful experience of the runaway inflation and collapse of the Continental dollar prompted the delegates to the
By the constitution of the United States, the several states are prohibited from coining money, emitting bills of credit, or making anything but gold and silver coin a tender in payment of debts. But no intention can be inferred from this to deny to congress either of these powers.[63]
See also
- Economic history of the United States
- Federal Reserve Note
- History of economic thought
- History of the United States dollar
- Monetary policy
- Money creation
- United States dollar
- Hyperinflation
Notes
- ^ Visually attractive and early examples were digitized and additional signer research was conducted later.
- ^ Obverse and reverse images have been prepared separately for table preparation purposes. Some of the notes obverse/reverse are not on the same orientation which would make single images containing both distracting.
- ^ Date of the first issue of paper currency for each of the Colonies.
- ^ Williams, Seymour, and Payne (among others) were appointed to a committee to print and sign currency for the Colony of Connecticut in the amount of 50,000 pounds.[16]
- ^ Newman (2008) indicates the total issue in Pound sterling despite the currency issue in dollars.[19]
- ^ O’Bryen, Treasurer of Georgia,[21] was elected to the Continental Congress but did not attend.[22]
- ^ Couden served as Mayor of Annapolis from 1785–86 and 1790–91.[25]
- ^ Act authorizing Ephraim Robinson and Joseph Pearson to countersign New Hampshire currency.[29]
- ^ Waddell was a New York City Alderman (1773–77) with the authority to sign currency issued to fund the "water works" under construction near Broadway and Chambers streets.[34]
- ^ Downing served as Speaker of the House of Burgesses from 1735 to 1739.[37]
- ^ Lovick was a member of the House of Burgesses.[38]
- ^ Pollock was a member of the House of Burgesses.[39]
- ^ Swann served as Speaker of the House of Burgesses in 1729.[37]
- ^ Hopkinson, Jones, and Fisher authorized to sign Pennsylvania currency.[42]
- ^ Act passed June 1780 authorizing Harris and Bowler to sign Rhode Island currency.[45]
- ^ Scott, Smyth, and Weston (among others) were appointed commissioners with the authority to print and sign one million dollars of South Carolina currency.[48]
References
- ^ "The Hull Mint - Boston, MA". Waymarking.com. January 20, 2012. Retrieved May 3, 2022.
- ^ Flynn 2008
- ^ a b c d e f Michener 2003
- ^ Andrew McFarland Davis, Currency and Banking in the Province of the Massachusetts-Bay, Volume 1, Issue 4 (American Economic Association, 1900) p.10
- ^ a b Newman 1990, p. 11.
- ^ based on the English calendar at the time, and equivalent to February 13, 1691 "new style"
- ^ Andrew McFarland Davis, and Banking in the Province of the Massachusetts-Bay, Volume 1, Issue 4 (American Economic Association, 1900) p.307
- ^ a b Wright 2008, p. 45.
- S2CID 154264538.
- ^ Allen 2009, pp. 96–98.
- ^ Allen 2009, p. 98.
- ^ Newman 2008, pp. 24–25.
- ^ Friedberg & Friedberg, pp. 12–29.
- ^ Newman 2008, p. 110.
- ^ a b Newman 2008, p. 89.
- ^ Public Records, May, 1775, The public records of the Colony of Connecticut 1636–1776, 1890, retrieved April 29, 2014
- ^ Newman 2008, p. 125.
- ^ Newman 2008, p. 119.
- ^ Newman 2008, p. 151.
- ^ Newman 2008, p. 130.
- ^ Journals of the Continental Congress, 1774–1789, Volume 11, Government Printing Office, 1908, retrieved April 29, 2014
- ISBN 9780160731761, retrieved April 29, 2014
- ^ Newman 2008, p. 172.
- ^ Newman 2008, p. 167.
- ^ Robert Couden, Maryland State Archives, retrieved April 29, 2014
- ^ Newman 2008, p. 200.
- ^ Newman 2008, p. 183.
- ^ Newman 2008, p. 223.
- ^ An Act describing the tenor of notes and certificates to be issued by the Treasurer of this state and appointing a committee to counter sign said notes, Laws of New Hampshire: First constitutional period, 1784–1792, 1916, retrieved April 29, 2014
- ^ Newman 2008, p. 260.
- ^ Newman 2008, p. 247.
- ^ Newman 2008, p. 285.
- ^ Newman 2008, p. 269.
- ISBN 9780806352398, retrieved April 29, 2014
- ^ Newman 2008, p. 315.
- ^ Newman 2008, p. 313.
- ^ a b North Carolina State House of Representatives – Past Speakers of the House, Colonial and State Records of North Carolina, retrieved April 29, 2014
- ^ Letter from George Burrington to the Board of Trade of Great Britain, Documenting the American South, retrieved April 29, 2014
- ^ Minutes of the Upper House of the North Carolina General Assembly, Documenting the American South, retrieved April 29, 2014
- ^ Newman 2008, p. 346.
- ^ Newman 2008, p. 331.
- ^ The Statutes at Large of Pennsylvania from 1682 to 1801, Volume 8, State Printer of Pennsylvania, 1902, retrieved April 29, 2014
- ^ Newman 2008, p. 399.
- ^ Newman 2008, p. 371.
- ^ Records of the Colony of Rhode Island and Providence Plantations, in New England, Alfred Anthony, Printer to the State, 1864, retrieved April 29, 2014
- ^ Newman 2008, p. 426.
- ^ Newman 2008, p. 405.
- ^ An ordinance for the printing, stamping and issuing one million dollars…, Statutes at Large of South Carolina: Acts, 1753 – 1786, 1838, retrieved April 29, 2014
- ^ Newman 2008, p. 443.
- ^ Newman 2008, p. 437.
- ^ Newman 1990, p. 16.
- ^ a b c Newman 1990, p. 17.
- ^ Wright 2008, p. 50.
- ^ a b c Wright 2008, p. 49.
- ^ Wright 2008, p. 52.
- ISBN 978-0-8122-1731-5.
- ISBN 978-1490572741.
- ^ Nuxoll, Elizabeth. "The Bank of North America and Robert Morris's Management of the Nation's First Financial Crisis" (PDF). Papers of Robert Morris. University of Pittsburgh Press: 162. Retrieved July 27, 2020.
- ^ Unger, Harlow (March 12, 2019). "How Robert Morris's "Magick" Money Saved the American Revolution". Journal of the American Revolution. Retrieved July 27, 2020.
- ^ Wright 2008, p. 62.
- ^ Morris Papers, Volume 7, pp. 761–765
- ^ U.S. Constitution, Article I, section 10.
- ^ Juilliard v. Greenman, 110 U.S. 421, 4 S.Ct. 122, 28 L.Ed. 204 (1884)
Bibliography
- Allen, Larry (2009). The Encyclopedia of Money (2nd ed.). Santa Barbara, California: ABC-CLIO. ISBN 978-1-59884-251-7.
- Flynn, David (March 16, 2008). Whaples, Robert (ed.). "Credit in the Colonial American Economy". EH.Net Encyclopedia.
- Michener, Ron (June 8, 2003). Whaples, Robert (ed.). "Money in the American Colonies". EH.Net Encyclopedia.
- Newman, Eric P. (1990). The Early Paper Money of America (3rd ed.). Iola, Wisconsin: Krause Publications. ISBN 0-87341-120-X.
- Newman, Eric P. (2008). The Early Paper Money of America (5th ed.). Iola, Wisconsin: Krause Publications. ISBN 0-89689-326-X.
- Wright, Robert E. (2008). One Nation Under Debt: Hamilton, Jefferson, and the History of What We Owe. New York: McGraw-Hill. ISBN 978-0-07-154393-4.
Further reading
- Brock, Leslie V. The currency of the American colonies, 1700–1764: a study in colonial finance and imperial relations. Dissertations in American economic history. New York: Arno Press, 1975. ISBN 0-405-07257-0.
- Ernst, Joseph Albert. Money and politics in America, 1755–1775: a study in the Currency act of 1764 and the political economy of revolution. Chapel Hill: University of North Carolina Press, 1973. ISBN 0-8078-1217-X.
External links
- Media related to Colonial currency at Wikimedia Commons
- Media related to Currency of the American Revolution at Wikimedia Commons
- Currency Issues to Overcome Depressions in Pennsylvania, 1723 and 1729
- Creating the U.S. Dollar Currency Union,1748–1811: A Quest for Monetary Stability or a Usurpation of State Sovereignty for Personal Gain?