Andrew Johnson was an unpopular president. He barely survived an impeachment attempt that split his own Republican Party.
Andrew Johnson served as Abraham Lincoln’s vice president. On April 15, 1865, four hours after President Lincoln’s death, Johnson assumed the presidency. He had fractious relationships with most of his cabinet and Congress. Many of these fights stemmed from his accommodating stance toward the South, which upset many members of the Republican Party, and with perceived cronyism in his presidential appointments.
His relationship with Treasury Secretary Hugh McCullough, by contrast, was reasonably good. Both men agreed on a policy of tight money and debt reduction following the Civil War. This policy succeeded in paying down the national debt and stabilizing the Federal government’s finances.
By October 1865, the national debt had reached $2.8 billion, most of which came from war spending, while prices in the North were 116 percent higher than in 1861. About $430 million in greenbacks, a fiat currency issued by the federal government that was not backed by gold, were in circulation. The Johnson administration immediately sought to pay down the debt and reduce the quantity of greenbacks outstanding. In 1866, Congress passed a bill to gradually reduce greenbacks, but a recession in Europe that summer prompted fears of a US contraction, and the administration postponed that effort. As the economy slowed further in 1867 and political tides shifted against Treasury, Congress overwhelmingly passed another bill to stop the retirement of paper money outright, and this measure passed without Johnson’s signature in early 1868. By that point, the amount in greenback notes totaled around $356 million.
Written by the Federal Reserve Bank of Richmond. See disclaimer.