“And I don’t give a damn about a greenback dollar, spend it fast as I can.” The Hoyt Axton song recorded back in the 1960s by the Kingston Trio expresses a bit of disdain for the paper currency of the United States. The disdain has been there right from the greenback’s debut a hundred years earlier.
The greenback came about because of the need to finance war, created by President George W. Bush to pay for the war in Iraq. Whoops — wrong president, wrong war. That one wasn’t paid for. President Abraham Lincoln, Civil War. The government had earlier issued demand notes to meet war expenses but they were insufficient. Other options such as borrowing from foreign governments at interest rates only loan sharks and credit card companies dare charge were unpalatable.
An Illinois businessman serving as a volunteer officer, Colonel Dick Taylor met with Lincoln and proposed issuing unbacked paper money: “Just get Congress to pass a bill authorizing the printing of full legal tender treasury notes… and pay your soldiers with them and go ahead and win your war with them also. If you make them full legal tender… they will have the full sanction of the government and be just as good as any money; as Congress is given the express right by the Constitution.”
Lincoln didn’t really like the idea but it beat going into deep debt to foreign creditors. He endorsed Taylor’s proposal, and on February 25, 1862, Congress passed the first Legal Tender Act, authorizing $150 million in United States Notes. The notes were printed with green ink on one side, thus their name. The value fluctuated wildly during the next few years along with war prospects, reaching a low point of 258 greenbacks to 100 dollars in gold.
But the war ended, and the greenbacks hung around so the Kingston Trio could sing about them a hundred years later. As low in esteem as they were once held, every modern move to replace them with more efficient dollar coins is met with a cry such as “don’t give a damn about a Susan B. Anthony or Sacagawea dollar.”
You might as well fall flat on your face as lean over too far backward. – James Thurber