The currency images below are for real. Until 1928, Andrew Jackson was on the $10 bill.
Printed in 1914 just after the Federal Reserve was created, this was the $10 bill with Jackson’s picture:
From a series that was issued in 1918, this $1000 bill had Hamilton’s image:
In 1928, for a reason that no one seems to know, Jackson wound up on the $20 bill. At the same time, we had some currency “musical chairs” as Hamilton was moved to the $10 bill and Cleveland who had been on the $20 went to the $1000 bill.
Where are we going? To the reason that Hamilton might remain on the $10 bill.
A New $10 Bill
Our story starts in 1778. At a lunch date in Paterson, NJ, Alexander Hamilton, George Washington and the Marquis de Lafayette had ham, tongue, biscuits and grog. One journalist suggests that Lafayette might have been thinking that the wine could be better. As for Hamilton, Paterson must have made a lasting impression because 23 years later as Secretary of the Treasury he cites the area for the development of manufacturing.
Hamilton referred to Paterson in the economic development plan that he presented to the U.S. Congress when he was George Washington’s Secretary of the Treasury. Inextricably interwoven, manufacturing, national credit that facilitated a manageable national debt and a national bank were the three parts of his plan.
Or, as Lin-Manuel Miranda’s Hamilton raps it, “If we assume the debts, the union gets a new line of credit, a financial diuretic. How do you not get it? If we’re aggressive and competitive, the union gets a boost. You’d rather give it a sedative?”
From Hamilton’s development plan, we can fast forward approximately 40 years when Andrew Jackson unravels it all. As a president who disliked banks, paper money and debt, he prevented the charter of the second Bank of the United States (BUS) from being renewed. As a result, soon after we no longer had the institution that supported the federal government’s fiscal policy, issued a dependable national currency, and offered business loans. Moving the government’s money from the second BUS to state banks, Jackson eliminated the union’s boost.
Our Bottom Line: Hamilton’s Legacy
As economists we can say that Broadway’s Hamilton is creating a positive externality. Having seen the show and heard the message that Hamilton is the father of our economy, Treasury Secretary Jack Lew might decide to keep Hamilton on the $10 bill and replace Andrew Jackson with a woman’s image on the $20.