Trump's...bill...reminds me of a blighted historical example: the Sherman Silver Purchase Act of 1890. It led to disaster. It was a classic case of an overconfident party overextending national finances to buy off a constituency without giving a thought to the consequences. Just like That Bill. 🧵/1 - ThreadSky

tj-stiles.bsky.social • 3 days ago

Trump's...bill...reminds me of a blighted historical example: the Sherman Silver Purchase Act of 1890. It led to disaster. It was a classic case of an overconfident party overextending national finances to buy off a constituency without giving a thought to the consequences. Just like That Bill.
🧵/1

Comments

tj-stiles.bsky.social•3 days ago

The post-Reconstruction GOP built an economic policy with 3 pillars, for 3 constituencies:
• Pensions for Union Veterans
• Protectionist Tariffs
• Gold Standard
A huge block of voters, Union Civil War vets were the bedrock of the GOP. They were rewarded with ever-more generous pensions.
🧵/2

tj-stiles.bsky.social•3 days ago

High tariffs, or "protection," was a pay-off to Northern industries. In the 1880s, industrialists built new plants and consolidated corporations & monopolies, sheltered by tariffs. Tariffs were key to party corruption, too. Customhouses were staffed by party loyalists who skimmed the take.
🧵/3

tj-stiles.bsky.social•3 days ago

Tariffs were paid in gold, sustaining the gold standard. The greenback was a Civil War innovation. By 1890, you could turn in paper money for gold coin. Europe was on the gold standard; exchange rates were a matter of weight. The gold standard integrated our financial markets with Europe's.
🧵/4

tj-stiles.bsky.social•3 days ago

The gold standard was aimed at bankers & corporations (not just manufacturers), which sold their securities overseas. So: 3 policies, 3 constituencies. But farmers in the West were up for grabs. They hated the gold standard, which was deflationary. Spend $100 planting, sell the crop for $90?
🧵/5

tj-stiles.bsky.social•3 days ago

In 1890, Congress was feeling flush. With no social programs (except for Civil War pensions) & a tiny Army & Navy, it felt rich. It responded to Western demands to expand the basis for our currency—to expand the currency to kill deflation—with silver. The Sherman Silver Purchase Act committed...
🧵/6

tj-stiles.bsky.social•3 days ago

...the United States to buying just about all the silver produced each year. The silver went in the vault, meaning gold remained the de facto basis of the currency. But here's the catch: the U.S. bought silver with notes that could be redeemed in gold. That's some catch.
🧵/7

Comments

Posting Rules

Reply