Strange and Obscure Stories of Washington DC by Tim Rowland

Author:Tim Rowland
Language: eng
Format: epub
ISBN: 9781510722798
Publisher: Skyhorse Publishing
Published: 2018-01-15T00:00:00+00:00

CHAPTER 6

Treasury Girls—The Original

Rosie Riveters

The North didn’t win the Civil War because it had better soldiers, it won because it had better bureaucrats. By definition, the Confederate model reason-for-being was small, decentralized government which, whatever its merits might be, isn’t terribly efficient if you’re trying to win a war. Many Southern soldiers went hungry not because there was no food, but because tons of it rotted on train-station platforms for want of a coordinated government transportation network.

But where the South really lost the war was in the area of finance. It had no centralized tax collection and no unified currency. Under Secretary of the Treasury Salmon P. Chase, however, the Union put in place a modern monetary system that largely remains intact to this day. Both sides printed up copious amounts of cash, but the Union raised taxes, sold bonds, and backed its currency with gold, so its paper money inspired confidence. In the Confederacy, by contrast, the currency was little more than Monopoly money, with nothing of value behind it. The proof was in the inflation rate, which through the course of the war was 9,000 percent in the South, but only 80 percent in the North.

It is possible to get a sense of the enormity of the war effort through the sheer physical amount of paper money it took to pay for it, and the manual labor needed to produce all that paper.

At the beginning of the war, Chase browbeat Northeastern banks into lending the Union $150 million in gold, to be secured with government paper paying 7.3 percent interest. But producing a government security was not a simple task. Prior to the war, the government contracted the job to New York printing houses, which took up to two months to complete the order. According to an essay by historian Franklin Noll, “The securities were printed from one to four [certificates] per sheet, and upon reaching the Treasury, the sheets were bound in a book. Then, whenever a security was sold, a clerk in the Register’s office would perform the proper record keeping and, taking a pair of scissors, cut the security out of the book. The security would then pass to the Register for his signature. Next, it went to the Treasurer’s office. There, more record keeping would occur, and the Treasurer would sign the security. The duly signed security would then pass to the Secretary’s office, which might record further information and pass it along to the sealing room. A clerk would emboss the Treasury seal on the security, marking its authenticity. The security was then ready for issue.”

This was tedious enough when the government’s standard annual issue was $10 million. Since $50 million represented 4.3 million pieces of currency, the job of signing and applying a seal to each one was staggering. One by one, Treasury got rid of the formalities; recording was scaled back, the embossed seal was eliminated and clerks were deemed good enough to sign the bill (a printed signature would come later).

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