Posts Tagged Civil War

Can you imagine postage stamps being used as currency? That is exactly what happened during the Civil War. When the Civil War started most people believed that it would end quickly. We all know differently. As the war dragged on, people went into panic mode and started hoarding their silver and gold coins. The country needed metal for weapons and machinery and so they restricted the production of new copper coinage. This metal hoarding on both ends caused a metal shortage.

To help with the problem, Congress passed a law permitting the use of postage stamps as currency! Huh? You can imagine the headaches this caused both those that used them, and the Post Office. The Post Office didn’t enjoy selling stamps as legal tender, and when customers came in with dirty or damaged stamps, the post office refused to replace them. After all, stamps were not made to be handled from person to person, and as small as they were, they were easily lost. One inventor tried to remedy the problem when he invented a protective encasing for the stamps and that helped for while. But the demand for the stamps increased, thus causing yet another shortage. What to do? US Treasurer F.E. Spinner, asked the government to produce fractional currency and on July 17, 1862, Abe Lincoln approved the Postage Currency Act. This act approved bills of five, ten, twenty-five, and fifty cents be produced and put in circulation.

The bills were much smaller than the ones we use today, in fact, they were postage stamp size. I might date myself here, but they looked like the sheet of small little stamps my mom used to get from the A & P. The first fractional bills produced were easy to counterfeit, so they came up with the idea of producing new ones that were more colorful and were printed on both sides. The bills came to be known as “shinplasters” because the soldiers were paid in fractional bills and they stuffed these bills into their boots to keep their feet warm. Some bills survive today.