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The Scales of Money: Monetary Sovereignty and the Spatial Dimensions of American Politics after the Civil War *

Published online by Cambridge University Press:  04 April 2017

Nicolas Barreyre
Nicolas Barreyre*
Affiliation:
CENA-Mondes Américains – EHESS
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Abstract

With its victory in the Civil War, the Union affirmed the primacy of the national sovereignty of the United States. After the conflict, the country was absorbed by the consequences of this momentous event. Yet, even in this context, the monetary policies of the government became contentious and led to the eventual redefinition of sovereignty. This article explores how the American institutional structure and political system allowed the money question to become a spatial issue, opposing the great sections of the country. In turn, this sectionalism triggered a confrontation between alternative understandings of what sovereignty entailed in terms of both political legitimacy and spatial scales. By the end of the century, the scope of sovereign power would be redefined, and currency abandoned as one of its instruments.

Type
Sovereignty and Territory in the Nineteenth and Twentieth Centuries
Information
Annales. Histoire, Sciences Sociales - English Edition , Volume 69 , Issue 2 , June 2014 , pp. 311 - 339
Copyright
Copyright © Les Éditions de l’EHESS 2014

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Footnotes

*

My text has benefitted from the kind and rigorous comments of Alexia Blin, Nathalie Clayer, Sabine Dullin, Thomas Grillot, Jean Heffer, Natalia Muchnik, Emmanuelle Perez, and Geneviève Verdo. My warmest thanks go to all of them.

References

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3. Carey, Monetary Independence, 3 and 8.

4. The present article approaches the question from a political angle, considering the actors’ knowledge of, and perspective on, events. For an economic analysis of the connection between political sovereignty and currency in the United States during this period, see Aglietta, Michel, “Genèse des banques centrales et légitimité de la monnaie,” Annales ESC 47, no. 3 (1992): 675–98 Google Scholar.

5. George H. Pendleton, speech delivered in Cincinnati on July 24, 1868, as transcribed by the Boston Campaign Post, July 31, 1868; U. S. Record and Gazette, vol. 2, no. 1, January 1875; Cincinnati Enquirer, December 16, 1869.

6. Speech delivered in Fort Wayne, October 1865, reproduced in McCulloch, Hugh, Men and Measures of Half a Century: Sketches and Comments (New York: Charles Scribner’s Sons, 1888), 201 Google Scholar.

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9. Cincinnati Enquirer, April 25, 1874, and September 9, 1867. Emphasis in the original.

10. This number in fact doubles if one includes the Democrats who were elected on a common platform with the Greenback Party: see “Party Divisions of the House of Representatives,” compiled by the Office of the Historian of the House of Representatives, http://history.house.gov/Institution/Party-Divisions/Party-Divisions/; Unger, Irwin, The Greenback Era: A Social and Political History of American Finance, 1865–1879 (Princeton: Princeton University Press, 1964), 393 CrossRefGoogle Scholar.

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13. The role of the two successive Banks of the United States proved crucial in this process. See Knodell, Jane, “Central Banking and Monetary Nation-Buildinginthe Early US, 1781–1834” (paper delivered at the conference “The Central Banks, the Nation, and the States,” Paris, March 2012)Google Scholar.

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16. Great Britain, which had been on the gold standard since 1816, accounted for more than a third of American imports and more than half of American exports. Friedman, Milton and Schwartz, Anna Jacobson , A Monetary History of the United States, 1867–1960 (Princeton: Princeton University Press, 1963), 64 Google Scholar.

17. Article 1, sections 8 and 10 of the US Constitution.

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19. Richardson, The Greatest Nation of the Earth ; Redlich, The Molding of American Banking.

20. James Garfield, Congressional Globe, 41st Congress, 2nd session, 4176 (June 7, 1870).

21. House Journal, 39th Congress, 1st session, 84 (December 18, 1865); Congressional Globe, 39th Congress, 1st session, 1500 (March 19, 1866); Chicago Republican, January 6, 1866; Alton Telegraph, November 24, 1865; Cincinnati Enquirer, December 13, 1865.

22. Blaine, James G., Twenty Years of Congress from Lincoln to Garfield: With a Review of the Events which Led to the Political Revolution of 1860 (Norwich: The Henry Bill Publishing Company, 1884), 2:328 Google Scholar. These debates did in fact lead to the emergence, over the medium term, of new intellectual frameworks for thinking about money, which are explored by Robert Boyer and Benjamin Coriat in “Innovations dans les institutions et l’analyse monétaires américaines: les greenbacks ‘revisités,’” Annales ESC 39, no. 6 (1984): 1330–59.

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24. The term “Midwest” is used here in the interest of clarity for the modern reader, as it refers to the region we now know by this name. The word itself, however, was not invented until the 1880s. Americans of the time spoke of the “West,” the “Northwest,” and at times the “Old Northwest.”

25. A large part of the country still consisted of federal territories that were unrepresented in Congress.

26. The phenomenon of sectionalism has been little studied in France. In the United States, scholarship has primarily considered the North-South conflict, given the place of the Civil War in American history and memory. See, for example, Finkelman, Paul and Kennon, Donald R., Congress and the Emergence of Sectionalism: From the Missouri Compromise to the Age of Jackson (Athens: Ohio University Press, 2008.Google Scholar) The political scientist Richard Bensel has devoted a more systematic study to the phenomenon, but mainly considers the period following the Civil War: Bensel, Richard Franklin, Sectionalism and American Political Development, 1880–1980 (Madison: University of Wisconsin Press, 1984)Google Scholar; Bensel, , “Congress, Sectionalism, and Public-Policy Formation Since 1870,” in Encyclopedia of the American Legislative System: Studies of the Principal Structures, Processes, and Policies of Congress and the State Legislatures since the Colonial Era, ed. Silbey, Joel H. (New York: Charles Scribner’s Sons, 1994), 3:1361–77 Google Scholar.

27. In roll-call votes, representatives vote by name: unlike voice votes or divisions of the House, the vote of each representative or senator is recorded. They are thus the only kind of vote that can be analyzed statistically. The analyses used in this article were made possible by the database compiled by Howard L. Rosenthal and Keith T. Poole, “United States Congressional Roll Call Voting Records, 1789–1990,” Inter-University Consortium for Political and Social Research (2000), dx.doi.org/10.3886/ICPSR09822.v2.

28. John Henderson, Congressional Globe, 40th Congress, 2nd session, 3190 (June 16, 1868).

29. Timothy Howe, Congressional Globe, 41st Congress, 2nd session, 704 (January 24, 1870).

30. Thomas Davis, Congressional Globe, 39th Congress, 2nd session, 1257 (February 14, 1867), 1257.

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33. Ohio Farmer, February 15, 1868, quoted in Unger, The Greenback Era, 200.

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36. Hulburd, Hiland R., Annual Report of the Comptroller of the Currency (Washington: Government Printing Office, 1868)Google Scholar, lix; Davis, Lance E., “The Investment Market, 1870–1914: The Evolution of a National Market,” Journal of Economic History 25, no. 3 (1965): 355–99 CrossRefGoogle Scholar.

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38. Larson, Henrietta M., Jay Cooke, Private Banker (Cambridge: Harvard University Press, 1936), 204–6 CrossRefGoogle Scholar; Sharkey, Robert P., Money, Class, and Party: An Economic Study of Civil War and Reconstruction (Baltimore: Johns Hopkins University Press, 1959), 245–50 Google Scholar; Unger, The Greenback Era, 44–48 and 158–62; Nugent, Money and American Society, 44–47.

39. Here, my analysis of sectionalism departs from those offered by Bensel, Sectionalism and American Political Development; Bensel, Yankee Leviathan ; and Bensel, , The Political Economy of American Industrialization, 1877–1900 (Cambridge: Cambridge University Press, 2000)CrossRefGoogle Scholar.

40. Cincinnati Enquirer, July 21, 1866.

41. Stimulating analyses can be found in the following: Cayton, Andrew R. L. and Onuf, Peter S., The Midwest and the Nation: Rethinking the History of an American Region (Bloomington: Indiana University Press, 1990)Google Scholar; Onuf, , “Federalism, Republicanism, and the Origins of American Sectionalism,” in All Over the Map: Rethinking American Regions, ed. Ayers, Edward L. et al. (Baltimore: Johns Hopkins University Press, 1996), 11–37 Google Scholar; and Etcheson, Nicole, The Emerging Midwest: Upland Southerners and the Political Culture of the Old Northwest, 1787–1861 (Bloomington: Indiana University Press, 1996)Google Scholar.

42. “Three petitions of citizens of the United States praying for an increase of the volume of the currency,” February 16, 1874, RG46, SEN43A-H8 (Senate Committee on Finance, 43rd Congress), Center for Legislative Archives, National Archives, Washington.

43. On the sectionalization of the tariff debate, see Barreyre, Nicolas, Gold and Freedom: The Political Economy of Reconstruction, trans. Goldhammer, Arthur (Charlottesville: University of Virginia Press, 2015), 78–110 Google Scholar.

44. Morrill, Justin, Congressional Globe, 39th Congress, 1st session, 3466–68 (June 28, 1866)Google Scholar. Carey also made the connection between the depreciation of the greenback, which amounted to an international exchange rate, and the protection of national industry: Carey, Henry C., The Public Debt, Local and National: How to Provide for Its Discharge While Lessening the Burthen of Taxation. Letter to David A. Wells, Esq., Chairman of the Board of Revenue Commissioners (Philadelphia: H. C. Baird, 1866)Google Scholar; Sharkey, Money, Class, and Party, 153–66.

45. The American Annual Cyclopaedia and Register of Important Events of the Year 1868 (New York: D. Appleton and Co., 1869), 744 Google Scholar; James A. Garfield to Edward Atkinson, May 25, 1868, Garfield Papers, series 6A, vol. 1, Library of Congress, Washington; Congressional Globe, 40th Congress, 2nd session, 4177–78 (July 17, 1866).

46. Quincy Whig, January 26, 1874.

47. Chicago Republican, July 9, 1866.

48. Chicago Tribune, October 1, 1866.

49. The statistical analysis of these votes can be found in Barreyre, Gold and Freedom, especially pp. 32 and 50.

50. James A. Garfield to Thomas J. Wood, April 12, 1869, Garfield Papers, series 6A, vol. 2.

51. James A. Garfield to Edward Atkinson, August 4, 1868, Garfield Papers, series 6A, vol. 1; Lyman Trumbull to William Jayne, August 5, 1870, quoted in Roske, Ralph J., His Own Counsel: The Life and Times of Lyman Trumbull (Reno: University of Nevada Press, 1979), 156 Google Scholar; Holt, Michael F., “Change and Continuity in the Party Period: The Substance and Structure of American Politics, 1835–1885,” in Contesting Democracy: Substance and Structure in American Political History, 1775–2000, ed. Shafer, Byron E. and Badger, Anthony J. (Lawrence: University Press of Kansas, 2001), 93–115 Google Scholar. Reconstruction was, moreover, exploited to offset the centrifugal effects of the money question: see Barreyre, Nicolas, “Réunifier l’Union: intégrer l’Ouest à la Reconstruction américaine, 1870-1872,” Revue d’histoire moderne et contemporaine 49, no. 4 (2002): 7–36 Google Scholar.

52. Barreyre, Nicolas, “The Politics of Economic Crises: The Panic of 1873, the End of Reconstruction, and the Realignment of American Politics,” Journal of the Gilded Age and Progressive Era 10, no. 4 (2011): 403–23 CrossRefGoogle Scholar.

53. Turner, Frederick Jackson, The Significance of Sections in American History (New York: H. Holt & Co., 1932), 22–51 Google Scholar, here pp. 41 and 51. Originally published as an article in 1923.

54. The 1869 law required the American government to use only specie to pay back its debt, but it agreed to begin reimbursements only once the greenback was convertible (Act of March 18, 1869, ch. 1, 16 Stat. 1). The law of 1875 set January 1, 1879 as the date for resuming specie payments, in exchange for a geographic redistribution of authorized national banking capital and the issuance of fractional silver coins for small transactions (Act of March 1, 1875, ch. 114, 18 Stat. 335).

55. Studies of sectionalism explain the phenomenon either in economic terms (with sections as spaces in which interests objectively converge) or in cultural terms. For the former see Bensel, Sectionalism and American Political Development; for the latter see Ayers et al., All Over the Map, or Cayton, Andrew R. L. and Gray, Susan E., The American Midwest: Essays on Regional History (Bloomington: Indiana University Press, 2001)Google Scholar. Analysis of the money question shows that sectionalism was primarily a political phenomenon connected to the nation’s institutional configuration; it was the latter that transformed cultural and economic geographies, which did not coincide, into a form of spatialization that had political effects.

56. On the way American politicians read public opinion in this period, see Barreyre, Nicolas, “Lire l’opinion publique dans les États-Unis de la Reconstruction (1865-1877),” in S’exprimer en temps de troubles. Conflits, opinion(s) et politisation de la fin du Moyen Âge au début du XXe siècle, ed. Bourquin, Laurent et al. (Rennes: PUR, 2011), 327–42 Google Scholar.

57. Parties would only become national at the turn of the century: Klinghard, Daniel, The Nationalization of American Political Parties, 1880–1896 (New York: Cambridge University Press, 2010)CrossRefGoogle Scholar.

58. Chicago Tribune, June 25, 1870. The census is the mechanism through which each state’s representation in the House is recalculated. As a result, the 1870 census greatly intensified sectionalism: see Barreyre, “Réunifier l’Union.” On the stakes of this oncea-decade recalculation, see Anderson, Margo J., The American Census: A Social History (New Haven: Yale University Press, 1988)Google Scholar; Schor, Paul, Compter et classer. Histoire des recensements américains (Paris: Éd. de l’EHESS, 2009)Google Scholar; and Kromkowski, Charles A., Recreating the American Republic: Rules of Apportionment, Constitutional Change, and American Political Development, 1700–1870 (Cambridge: Cambridge University Press, 2002)CrossRefGoogle Scholar.

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60. The Nation, December 26, 1878, cited in Unger, The Greenback Era, 402.

61. Flandreau, The Glitter of Gold ; Flandreau, , “The French Crime of 1873: An Essay on the Emergence of the International Gold Standard, 1870–1880,” Journal of Economic History 56, no. 4 (1996): 862–97 CrossRefGoogle Scholar.

62. The brief debates were confined to congressional committees. They never reached the broader public and did not preoccupy the financial press: Nugent, Money and American Society; Reti, Steven P., Silver and Gold: The Political Economy of International Monetary Conferences, 1867–1892 (Westport: Greenwood Press, 1998), 49–51 Google Scholar.

63. Samuel Hooper, Congressional Globe, 39th Congress, 1st session, 975 (February 21, 1866).

64. Gallarotti, Giulio M., “The Scramble for Gold: Monetary Regime Transformation in the 1870s,” in Monetary Regimes in Transition, ed. Bordo, Michael D. and Capie, Forrest (Cambridge: Cambridge University Press, 1994), 15–67 Google Scholar; Frieden, Jeffry A., “The Dynamics of International Monetary Systems: International and Domestic Factors in the Rise, Reign, and Demise of the Classical Gold Standard,” in The Gold Standard in Theory and History, ed. Eichengreen, Barry and Flandreau, Marc, 2nd ed. (London: Routledge, 1997), 207–27 Google Scholar.

65. Weinstein, Allen, Prelude to Populism: Origins of the Silver Issue, 1867–1878 (New Haven: Yale University Press, 1970), 83–100 Google Scholar.

66. The Diary of James A. Garfield, vol. 3, 1875–1877 , ed. Brown, Harry James and Williams, Frederick D. (East Lansing: Michigan State University Press, 1973), 262 and 333 (April 31 and August 9, 1876)Google Scholar; Congressional Record, 44th Congress, 1st session, 4213–15 (June 28, 1876); ibid., 4563 (July 13, 1876).

67. Act of February 28, 1878, ch. 20, 20 Stat. 25.

68. Weinstein, Prelude to Populism ; Unger, The Greenback Era ; Seip, Terry L. The South Returns to Congress: Men, Economic Measures, and Intersectional Relationships, 1868–1879 (Baton Rouge: Louisiana State University Press, 1983)Google Scholar.

69. Holt, Michael F., By One Vote: The Disputed Presidential Election of 1876 (Lawrence: University Press of Kansas, 2008)Google Scholar; DeCanio, “State Autonomy and American Political Development.”

70. France suspended the minting of silver coins the same year, but insisted that it was still bimetallist and that silver coins in circulation remained legal tender. Other countries in the Latin Monetary Union also adopted this position. Germany no longer used silver except as a subsidiary currency, though it maintained enormous reserves of silver thaler, which were withdrawn from circulation but were still legal tender. In Austria and Russia the official standard was silver, but in reality both countries used non-convertible paper money during this period. Flandreau, The Glitter of Gold.

71. Reti, Silver and Gold, 79; Report of the United States Monetary Commission (Washington: Government Printing Office 1877); Weinstein, Prelude to Populism, 255–61 and 302–3.

72. Greenbury L. Fort and William J. O’Brien, Congressional Record, 44th Congress, 2nd session, 548–49 (January 10, 1877). On the mechanistic conception of the economy, see Nugent, Money and American Society, 33–38.

73. Franklin Landers and Richard P. Bland, Congressional Record, 44th Congress, 2nd session, 552 and 549 (January 10, 1877).

74. Augustus S. Merrimon, Congressional Record, 45th Congress, 2nd session, 1085–87 (February 15, 1878).

75. There is currently a renewed historiographical interest in Populism. See Postel, Charles, The Populist Vision (Oxford: Oxford University Press, 2007)Google Scholar; Bensel, Richard Franklin, Passion and Preferences: William Jennings Bryan and the 1896 Democratic National Convention (New York: Cambridge University Press, 2008)CrossRefGoogle Scholar.