US soldier's pay 1863

[corn-fed-erate]

In mid- 1863, what form of payment did US soldiers receive? Was it in the new "greenbacks", coin, or a combination?

 

[kevikens]

I asked and then researched a question similar to yours, though for the year 1861. The reason I became interested in that matter was because at the start of the war there were no "Greenbacks" or any US Government issued paper currency at all. Prior to the war soldiers were paid, depending on where they were stationed, in federal vouchers which any specie paying bank would accept as a deposit, or cash and return as state chartered bank notes or specie as requested. Where such banks were not available, such as out west or where banks dealt only in specie (California) the paymaster would convert the vouchers right there into specie.

At the start of the war I had thought that since the volunteers were raised by the individual states that these early troops might have been paid in banknotes issued by their own state chartered banks but I never found evidence of this. What I did find was an article in a newspaper, which I no longer can recall or have in my collection, from late in 1861 when the US Government had started to print up a first batch of treasury notes for payment to contractors, as specie in the form of US coins, especially gold, was already being pulled out of circulation. The article recommended to soldiers that they should now accept, even prefer these new notes to specie coin, because they were convenient to carry and especially easy to return by mail to their homes. The implication was that they were still being paid in coin into late 1861.

By early 1862 state chartered banks had ceased all specie payments (except on the West Coast), gold and silver vanished and the US turned to a fiat paper currency, the Greenbacks. Though the federal mints continued to turn out specie coins, from the tiny three cent silver "trime" to the $20 double eagle, the federal government used the specie coins mostly for purchases abroad where specie was required. The exception to that was the interest payment on bonds the US Government was offering. You could use paper, Greenbacks, or from 1863 a new federal currency, National Bank Notes, to buy government bonds and the interest would be paid in gold. In the marketplace the buying and selling could be chaotic. There were state chartered bank notes continuing in circulation, along with private notes in small denominations, similar one cent tokens, almost like store coupons today(shinplasters), stamps, then fractional notes based on stamps, odd foreign coins came out of shoeboxes, the Greenbacks and National Notes and the occasional US specie coin which commanded a premium over its nominal value. Union soldiers used all this money (and Confederates when they could get it) but their pay was now issued only in Greenbacks and fractional currency, and that often months in arrears. In April 1865 a Union officer purchased a table from Wilbur McLean's house in Appomattox and paid two US $10 gold eagles for it but wherever he got those from it was not the paymaster. By the way the premium for twenty dollars in gold at that time was a little over $30 in paper. A most fascinating and neglected area of study from our Civil War, its circulating medium.