The management of the Treasury, a responsibility hardly less in importance under the war conditions than that of the organisation of the armies, was placed in the hands of Senator Chase.  He received from his precursor an empty treasury while from the administration came demands for immediate and rapidly increasing weekly supplies of funds.  The task came upon him first of establishing a national credit and secondly of utilising this credit for loans such as the civilised world had not before known.  The expenditures extended by leaps and bounds until by the middle of 1864 they had reached the sum of $2,000,000 a day.  Blunders were made in large matters and in small, but, under the circumstances, blunders were not to be avoided and the chief purpose was carried out.  A sufficient credit was established, first with the citizens at home and later with investors abroad, to make a market for the millions of bonds in the two great issues, the so-called seven-thirties and five-twenties.  The sales of these bonds, together with a wide-reaching and, in fact, unduly complex system of taxation, secured the funds necessary for the support of the army and the navy.  At the close of the War, the government, after meeting this expenditure, had a national war debt of something over four thousand millions of dollars.  The gross indebtedness resulting from the War was of course, however, much larger because each State had incurred war expenditures and counties as well as States had issued bonds for the payment of bounties, etc.  The criticism was made at the time by the opponents of the financial system which was shaped by the Committee of Ways and Means in co-operation with the Secretary, a criticism that has often been repeated since, that the War expenditure would have been much less if the amounts needed beyond what could be secured by present taxation had been supplied entirely by the proceeds of bonds.  In addition, however, to the issues of bonds, the government issued currency to a large amount, which was made legal tender and which on the face of it was not made subject to redemption.

In addition to the bills ranging in denomination from one dollar to one thousand, the government brought into distribution what was called “postal currency.”  I landed in New York in August, 1862, having returned from a University in Germany for the purpose of enlisting in the army.  I was amused to see my father make payment in the restaurant for my first lunch in postage stamps.  He picked the requisite number, or the number that he believed would be requisite, from a ball of stamps which had, under the influence of the summer heat, stuck together so closely as to be very difficult to handle.  Many of the stamps were in fact practically destroyed and were unavailable.  Some question arose between the restaurant keeper and my father as to the availability of one or two of the stamps that had been handed over.  My father explained to me that immediately after the outbreak