Feb. 7, 1870: The U.S. Supreme Court issues its ruling in Hepburn v. Griswold, striking down the Legal Tender Acts and annoying the heck out of President Ulysses S. Grant. During the first year of the Civil War, U.S. gold reserves shrank alarmingly—to the point where banks and the government stopped redeeming bank notes and treasury notes in gold. In response, Treasury Secretary Salmon P. Chase, who believed that federal paper money was unconstitutional, nonetheless drew up a plan to issue notes that could not be immediately converted to gold. The notes—dubbed “Greenbacks”—were deemed by congressional fiat to be “legal tender for all debts public and private.” In Griswold, the Court—led by Chief Justice Salmon P. Chase—ruled that the government could not use Greenbacks to pay debts incurred before the Legal Tender Acts, which was the whole point of the acts. Grant responded as any president would: He reinstated the acts through executive order and used the next two vacancies to appoint justices who would do what he wanted. A year later, Grant got his wish when the new court reversed Griswold and set the stage for Chase to have his portrait engraved on the $10,000 bill. —
Jeffrey Kanige
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