The Freeman 1972 - The Ludwig von Mises Institute

1972 THE CRITICAL PERIOD 623one way or another by the legacyfrom the war. Those who had goneinto debt to buy real property onlong terms during the inflationwere undoubtedly often hard. putto payoff in the much scarcermoney that was now being used.For example, in Worcester Countyin Massachusetts, there were over2,000 suits taken to court for recoveryof debt in one year.12Americans had not only to adjustto a reduced money supply butalso to a new trading situationafter the break from England. Tomany, the new situation providednew opportunities, but others triedto cling to and make a go of theold relations (particularly wasthis true of trade with England).The states were generally deeplyin debt from the war, and some ofthem ·attempted to begin to retiretheir obligations by levying taxes.This could be particularly hard onthose' who owed debts for theirland and had to pay high propertytaxes as well.These things are relevant to amounting crisis in the UnitedStates because they were the occasionfor pressures on the governmentsto do something aboutthem. Some of the functions peoplewere accustomed to have governmentperform were either notbeing performed or were irregularlyperformed. Americans hadnot only a legacy of mercantilismbut also of monetary manipulations.Debts, taxes, and trade regulationsplagued the new governments.There was not even astandard currency throughout theUnited States.Coinage and ExchangeWhen the Continental and statecurrencies were repudiated,peopleused coins primarily for a mediumof exchange. There were few mintedin America during this period,so that foreign coins circulatedmostly: "English, French,Spanish,and German coins, of variousand uncertain value, passed fromhand to hand. Beside the ninepencesand four-pence-ha'-pennies,there were bits and half-bits, pistareens,picayunes, and tips. Ofgold pieces there were the johannes,or joe, the doubloon, the moidore,and pistole, with Englishand French guineas, carolins, ducats,and chequins."13 In additionto the difficulty of calculating therespective value of each of thesecoins, there was the complicationthat coins were frequently wornor clipped. A man who acceptedone of the latter at full valuemight have it discounted when hetried to use it. Americans did nothave a medium of exchange; theyhad media through which exchangesof money for money werealmost as precarious as exchangesin goods and were using coins