What were Greenbacks during the Civil War?

Greenbacks were a type of paper currency that the U.S. government issued during the Civil War that was not backed by gold or silver, which means they were fiat money that held value based on the government's declaration rather than a physical commodity. This system was implemented in order to help finance the war effort, as the Union faced significant financial challenges due to the costs associated with the conflict. By using greenbacks, the government could produce money more freely, which facilitated the payment of soldiers, supplies, and other war-related expenses.

The use of greenbacks also led to significant economic implications, including inflation and debate over monetary policy, as the reliance on unbacked currency had mixed impacts on the economy and the public's confidence in the value of the money. This historical context illustrates the broader economic strategies that the Union employed during the Civil War to sustain itself amid financial constraints.