July
 2003 Issue
By James C. Johnston Jr.
Photos by Steven Vater

In 1775, the American Revolution began in Lexington and Concord, Massachusetts. “The shot heard ‘round the world,” was fired, and by 1783 Great Britain would be forced to give up the better part of her vast American Empire.

Between 1775 and 1776, the aim of the Revolution was not totally clear. The patriots were fighting for the “Rights of Englishmen,” which were vouchsafed to Englishmen in America in “English Constitution,” which consisted  of Habeas Corpus, Trial by Jury, Magna Carta, the Petition of Rights, the English Bill of Rights, Common Law, and custom-and-usage. It was for these rights that the English-ruled Americans of the thirteen original colonies fought.

It was not until 1776 that the American Revolution took a new turn.  As of July 4, 1776, the United States was fighting for its total political independence and its integrity as a sovereign nation. Jefferson’s monumental Declaration of Independence made our case for independence to the world. This document detailed how the King and Parliament robbed Americans of their rights as subjects of the Crown, why the colonies ought to be independent of Britain, and then actually made a statement of separation from the mother country.

Now the deed was done. The United States had committed itself to a war for freedom. How was the new nation to pay for this fight for independence? England had been the largest trading partner the colonies had. Trade was all but dead, and hard cash was not to be had.

As royal colonies like Maryland and Pennsylvania had issued paper money during the Colonial period, the new government of the United States was to issue its own currency. The Colonial notes had a solid monetary foundation and was backed by the royal government. The new notes issued by the United States were faith notes, whose value depended on the strength and faith Americans had in their new government.

The new government issued “continental currency” which had values expressed in terms of Spanish dollars more commonly known as “Pieces-of-Eight.” These were so-called because they were coins of eight reals. The Spanish dollar was the most widely circulated silver coin in the world. For almost three hundred years, the silver mines of Mexico, Peru, Bolivia, and the rest of Spanish America had pumped out countless tons of silver ore. It was not unusual that the United States would like to tie its new paper money to this world-reliable non-English coinage.

But alas, the emperor had no clothes, and it was not long before the new citizens of the United States discovered that this paper money had no real value. In Rhode Island, there was a period of time in the 18th century when it was against the law to refuse to accept its paper money in payment for goods. Shopkeepers could be – and were – imprisoned and fined for refusing to accept the Rhode Island currency.

In the town of Franklin, Massachusetts, the worthless paper money was put into a special fund to pay its Congregational minister, Nathaniel Emmons. He was not amused. In truth, many of the former Colonists would rather do business with the British Army for gold then with the American Army for continental currency. The economic realities of life overcame patriotism all too often.   

The “State of Massachusetts Bay,” also known as the Commonwealth of Massachusetts, issued tons of paper money during the Revolution and actually redeemed some of it for hard cash. I have collected one such note, shown here, which is rarer than many because of the signature on the note. My two-dollar note was signed by William Dawes, who was most famous for finishing Paul Revere’s ride in April of 1775 to warn the colonists that, “The British are Coming!” That was Dawes’ finest hour.

It is strange that in 1786 that the refusal of Massachusetts to accept payment of taxes in paper money would actually trigger a revolt in the western part of the Commonwealth. Farmers, who had no hard cash and had been paid for a substantial portion of their military service in paper money, were not allowed to pay their taxes with Massachusetts issued notes or continental currency. Captain Daniel Shayes led a revolt against the government of Massachusetts over this issue. Farmers who had been veterans of the Revolution joined him in an attack on the courthouse in Springfield, Massachusetts.

The government of the United States, under the Articles of Confederation, had no authority or forces to put down this “Paper Money Revolt.” It fell to general Benjamin Lincoln (Washington’s second in command at Yorktown) to do the job with forces of militia raised in the richer eastern part of the Bay State. Shayes and a goodly number of his followers fled to what in time would become the State of Vermont.

In March of 1776, some colonies, such as New Jersey, were still issuing paper money under the authority of the crown. These notes were issued in English denominations like the one shilling note shown here signed by one of my Southern Johnston relatives. This nod of courtesy to the crown would end in July, 1776, however, and documents issued under the new government’s jurisdiction would recognize either the United States of America or their state. No longer would paper money, deeds, and other items read, “In the fourteenth Year of the Reign of His Majesty King George the Third.” Now many would read instead, “In the First Year of Independence of the United States.”

The American Revolution was a hard-fought war funded largely by worthless paper money. When we were joined by France in our struggle against the might of the British Empire, victory seemed possible. French troops and French gold provided the fuel for the Revolution. In fact, there were more French troops fighting   England by 1781 then there were American troops in combat.

After the Revolution was over in 1783, the paper Continental dollar was so worthless that a popular idiom was coined, “Not worth a Continental!” to describe something of no value. Yet the paper money was a big help in our struggle for freedom. It funded a revolution.         

Many collectors attempt to put together collections of Revolutionary War state notes representing all thirteen original colonies. It is a tough job, but it can be dome for about $2,000 to $3,000. The much-hated and resented little notes of the Revolutionary period are now treasured artifacts of those heroic days when we gained our freedom from Great Britain.