Explore how the United States raised approximately $2.3 billion through the sale of bonds during the course of the American Civil War by examining the stories of those who purchased the bonds.
The American Civil War cost the federal government $3.2 billion; much of the money was raised from the sale of Union bonds. I am interested in how these bonds were marketed and sold and through this, what version of the war the Union public was willing to buy and buy into. My dissertation looks particularly at the bond agents—the large financial house of Jay Cooke and Company, as well as their subcontracting agencies and the thousands of traveling agents who canvassed far and wide to sell their wares. This, in essence, was the business of bond sales. Through exhaustive marketing campaigns tailored to a wide class of investors, these financiers and their salesmen instilled what proved to be a self-fulfilling faith and confidence in Union victory.
Once more, the war was bought by a large swath of the general public, the most democratized financing of a war to date in American history. The first large-scale American effort to extend the securities market to small savings individuals is vital to understanding the Civil War writ large. Originating with long established war finance principles of reaching out to banks and a small circle of financiers in northeastern cities, the war’s unparalleled financial demands resulted in an improvisation of financial thought. By war’s end, it truly was “a people’s contest” wherein the democratization of bonds sales represented ownership of the war (not to mention bonds) on behalf of the Northern populace, stretching across the Union states and territories binding them, financially and otherwise, as part of a new America. In articulating such a vision, the buyers and sellers alike helped to underwrite the Union’s military campaign and present a radically new vision of American war finance and a new United States moving forward. Wedded in debt to the Union cause and the nation, the public and the federal government became entwined to a degree never before seen. The people and state found themselves in unchartered waters. In bonds, the performance of sales became directly tied to the success of the Union cause.
Bond sales were not restricted domestically, however. The marketing of such securities also crossed the Atlantic to buyers in England, France, Belgium, Switzerland, Spain, Ireland, the Netherlands, the Italian states, and the German states and helped to ensure that foreign countries had a vested interest in the Union’s success. These bonds also gained traction in the Caribbean as many prominent members of the Cuban elite purchased bonds, not to mention individuals from Haiti and the Bahamas. Sales also extended to South America with purchases from Peruvian citizens. International sales accounted for at least $400 million of overall sales and had tremendous influence in turn over domestic markets and performance on northern exchanges. This, too, reflected the business of bonds that took on an international scope.