Monday, December 30, 2013

The Night They Drove Old Dixie Down

Now, I don't mind chopping wood
And I don't care if the money's no good
You take what you need
And you leave the rest
But they should never
Have taken the very best
(From The Night They Drove Old Dixie Down)

This year at Christmas, my parents decided it was time to pass on a few of the family treasures to the next generation. We went to the bank to retrieve several Confederate bank notes issued by the Commonwealth of Virginia from the safety deposit box. They belonged to my mother’s grandfather.

How he came to possess them is a lost bit of family history.

In 1861 the southern states seceded from the Union starting almost five long years of bloody fighting that left much of the nation in ruins. The new Confederacy needed money, a lot of money, to fight a war against the larger, more populated, better industrialized states that remained in the Union. All the gold and silver the Confederacy possessed went to Europe to buy badly needed war supplies. For this reason there are not many Confederate coins in circulation. They did what any nation would do in such a situation. The Confederacy, the individual states of the Confederacy, and even some towns printed paper money backed by nothing but a promise to pay the bearer off after the war ended. At the beginning of the war the new currency circulated at a reasonable value. As the war dragged on, it became clear that the Southern states would be defeated, so the value of Confederate currency declined until, “By the end of the war, a cake of soap could sell for as much as $50 and an ordinary suit of clothes was $2,700.” (wikipedia) At the end of the war, Confederate currency was worthless.

My mother’s grandfather lived in West Virginia, a border state. At the start of the war Virginia seceded along with the other 10 states of the Confederacy. The western counties of Virginia resented the financial and political power of the Tidewater plantation owners of the eastern counties. As there weren’t very many slaves in the western counties and their citizens were looking for a reason to leave Virginia anyway, these counties seceded from the Commonwealth of Virginia to form the free state of West Virginia. At the beginning of the war, these bits of paper would have been legal tender. My ancestor would be legally obligated to use them. While West Virginia was firmly a part of the Union, it was never completely pacified. The war ebbed and flowed across the area around Harpers Ferry, leaving that once important industrial center in ruins. Guerrilla bands of irregular Confederate sympathizers roamed the hills of West Virginia until the end of the war. Perhaps a band of these fighters forced my ancestor to take them in payment for goods stolen at gunpoint. Maybe somebody threw them away at the end of the war and he just picked them up and put them in a drawer as historic curiosities. I would love to know the truth.

The richer more powerful Union states had their own problems with paper money. Even with California’s gold flowing into Federal coffers, Lincoln needed more money to prosecute the war. First the Federal Government forced loans from the major New York banks, but they ran out of money. European bankers wanted 24%-36% interest on any war loans, an impossibly high rate. The United States issued the so called “Greenback Dollars.” Unlike regular U.S. Bank Notes there was printing on only one side of the paper on the Greenback Dollars. The back of the notes were blank, just green paper. Unlike regular currency these notes were not backed by gold, just a promise. Their value rose and fell with the fortunes of war. Their value fluctuated between 129 greenbacks to 100 dollars to a low of 258 greenbacks to 100 dollars. At then end of the war the ratio was 150 greenbacks to 100 dollars. A lot of Americans forced to use this war currency lost a lot of money they never recovered.

The song, The Night They Drove Old Dixie Down, captures the pathos and despair of the South in the final days of the war and the suffering of the common working class Southerner during Reconstruction, the military occupation of the defeated nation. I wonder how the composer of that song could so perfectly capture a moment in history over a hundred years after the fact.

As you enjoy this amazing performance of this classic song, think about the history of paper money and the only major failure of the American genius for consensus, the Civil War.

The Night They Drove Old Dixie Down

No comments:

Post a Comment