Title: Definition of Greenbacks
Headings: Definition of Greenbacks
Definition of Greenbacks
The Civil War created paper money with a name that stuck
The Civil War Prompted the Need for Money
The Early Greenbacks Appeared in 1862
The Confederate Government Also Issued Paper Money
Greenbacks Were Successful

Content: The printing of money by the government was seen as a wartime necessity prompted by the great costs of the conflict and it was a controversial choice. The objection to paper money was that it wasn't backed by precious metals, but rather by confidence in the issuing institution i.e. the federal government. ( One version of the origin of the name "greenbacks" is that people said the money was only backed by the green ink on the papers' backs.) The first greenbacks were printed in 1862, after the passage of the Legal Tender Act, which President Abraham Lincoln signed into law on February 26, 1862. The law authorized the printing of $150 million in paper currency. A second Legal Tender Act, passed in 1863, authorized the issuing of another $300 million in greenbacks. The Civil War Prompted the Need for Money
The outbreak of the Civil War created a massive financial crisis. The Lincoln administration began recruiting soldiers in 1861, and all the many thousands of troops had to be paid and equipped with weapons—everything from bullets to cannon to ironclad warships had to be built in northern factories. As most Americans did not expect the war to last very long, there didn't seem to be a pressing need to take drastic action. In 1861, Salmon Chase, the secretary of the treasury in Lincoln's administration, issued bonds to pay for the war effort.