The problem of money dominated American politics in the 1890s. American had led the world in financial experiments, and in innovative forms of credit and exchange--including paper money and personal checks. The rapid pace of American economic growth made money a controversial subject. What was money, anyway? One school of thought insisted that money could only be gold--"gold bugs" argued that gold was the "natural" money, and that if left alone all people would choose gold as money. "Silverites" replied that using gold alone kept interest rate too high and hindered economic growth. We needed more money, they insisted, and so we should use gold and silver together as our money. A third group insisted on paper money, arguing that money was just a social convenience--anything at all could serve as money, these "greenbackers" argued, if all agreed to use it. In the cartoon shown here, Thomas Nast denounces greenbacks as a fraud, an attempt to make something out of nothing.


from David A. Wells, Robinson Crusoe's Money (NY 1876; reprint ed. NY 1896)

This cartoon, by the famous political satirist Thomas Nast, attacks paper money as "the rag baby," a fraud and a delusion. You cannot simply legislate value into something which doesn't have it, gold bugs like Nast insisted. But all dreams are fantasy, greenbackers in effect replied, till hard work and effort makes them reality. Paper money really could be turned into "a house and lot," if local carpenters accepted it as wages when they built the house.

By the 1890s, Gold Bugs frequently couched their attacks on silver or paper in racial terms, as this cartoon below suggests. Taken from Sound Currency, a collection of pamphlets, tracts and cartoons distributed monthly by proponents of the gold standard, the cartoon shows silver as the money of inferior peoples--the gaunt Chinese, Mexican and Indian workers huddle in shadows while the robust American, English and German workers reject the silver "cure."


From Sound Currency, October 1 1895 p. 429

Produced in 1895, the cartoon reflects some of the fears about new immigrants (especially the Chinese) that characterized this period.

For an interesting set of links on money and its history, see Electronic Money and Money in History.

Ironically, the period saw an explosion in new forms of finance, especially payment by check, which rendered the whole gold/silver question much less relevant. An era of fantastic economic expansion, the period also experienced remarkable financial instability. Rampant counterfeiting only increased the public's anxiety about the nature of money. Look at the two bills on this page. Can you tell which is the fake?