Bank Notes and Shinplasters by Joshua R. Greenberg

Author:Joshua R. Greenberg
Language: eng
Format: epub
Publisher: University of Pennsylvania Press, Inc.
Published: 2020-07-15T00:00:00+00:00

The picture Leggett eloquently painted captured the weekly experience of workers in New York and across the nation. Pushed to take discounted bank notes for already completed work, they scrambled to get as much value as they could from the bills. In true Leggett form, the tragedy he portrayed was not just that bankers and money brokers defrauded mechanics and laborers, but that they reaped financial benefits without doing hard work.22

The fraudulence that robbed workers of their rightful earnings did not even require malice; it was baked into the paper currency system. Leggett explained that a small grocer might receive one hundred dollars in uncurrent bills a week, but without the ability to redeem them at the bank, had to seek out a broker who turned them into “ninety-eight dollars in bankable money.” Over the course of a year, the grocer lost one hundred dollars and rather than bear the loss himself, passed it along to the “carpenter, the bricklayer, and the labourer, when they [bought] a pound of tea, or cheese, or butter, or any other article in his line, to take home to their families.” This meant that “every article of consumption is now charged from two to three per cent higher than it ought to be,” whether or not the grocer wanted to gouge his customers. Of course, Leggett printed plenty of stories where greedy vendors manipulated bank note transactions, but even these highlighted the inefficiency inherent in the system.23

Loco Foco depictions of uncurrent bank notes as both a systematic and an immediate household danger gave hard money advocates a framework for understanding and challenging the paper money system based on personal observations. Even though scholars claim that Jacksonian-era opposition to paper money alternatively sprang from adherence to literalist constitutional readings, belief in Gresham’s Law that bad money drives good money out of the market, or an allegiance to the political economy of British writer David Ricardo, these sources were not where most Americans looked for monetary policy analysis. It was Leggett’s more personal explanation of how bank notes defrauded hardworking members of society that inspired the call for a hard money economy. His bank note editorials did not mention Gresham or Ricardo; they spoke to the injustices that his readers witnessed with their own eyes. Hard money advocates around the nation reiterated Leggett’s message with appeals grounded in similar terms. When the editors of Loco Foco, in Swanton, Vermont, complained of workers getting paid in merchant shinplasters, they didn’t look to erudite economic treatises, but explained that a local man received “but fifty cents per day for his labor, and that in merchandise—in miserable trash on which his family could not subsist, and for which he had to pay double its real value.” Such a charge could have come from Leggett himself.24

Warnings about paper money explicitly tied monetary practice to electoral outcomes. An 1837 appeal to “laboring and working men” sought to turn individuals scammed by poor-quality bank notes into a voting bloc. It asked these

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