Historical Literacy Guide:

Economics

WISCONSIN BANK NOTES

Table of Contents

Introduction

ObjectLiteracy...............................................................................................3

ThinkingLikeaHistorian................................................................................4

BackgroundInformation............................................................................................5

ImagesfortheClassroom..........................................................................................7

StudentActivity.......................................................................................................8

Teacher-ledStudentInquiryandAnalysisQuestions....................................................9

BibliographyandAdditionalResources.....................................................................10

Reflection..............................................................................................................11

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Object Literacy: Learning from ObjectsTheWisconsinHistoricalMuseum,aspartoftheWisconsinHistoricalSociety,has

developedthefollowingguidetoassistintheteachingofstandardsforsocialstudies.

Byfocusingonobjects,artifacts,maps,photographsandotherprimarysourcesfromits

collection,studentswillbeabletoredefinehowtheylearnfromobjectsandfromhistory.

Object-based learning is

•Usingavarietyofobjectsascentraltothedevelopmentoflessonconcepts

•Utilizingobjectsthroughposingandinvestigatingquestions

•Utilizingwell-thought-outinitialquestionstostimulatefurthercriticalthinking

•Usingstudents’naturalinterestandinclinationforquestion-posingtoguide

instructioninallsubjects

•Leadingstudentstotheirownanswersbyrespondingtoopenendedquestions

and/orreturningthestudents’focustotheobject

•Student-directedlearningfollowingpathscreatedbythestudents

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TLH CATEGORIES

CAUSE AND EFFECT

CHANGE AND CONTINUITY

TURNING POINTS

USING THE PAST

THROUGH THEIR EYES

Thinking Like a Historian: Rethinking History Instruction

and Common Core State Standards Initiative

Thinking Like a Historian: Rethinking History InstructionbyNikkiMandellandBobbie

Maloneisateachingandlearningframeworkthatexplainstheessentialelementsof

historyandprovides“how-to”examplesforbuildinghistoricalliteracyinclassroomsat

allgradelevels.Withpracticalexamples,engagingandeffectivelessonsandclassroom

activitiesthattietoessentialquestions,Thinking Like a Historianprovidesaframework

toenhanceandimproveteachingandlearninghistory.

Thinking Like a Historian: Rethinking History Instruction

(TLH) inquiry-based educational theoryprovidesacommon

languageforeducatorsandstudents.Thetheoryallowsfor

theeducationalprocesstobecombinedwithcategoriesof

inquirywhichpromotehistoricalliteracy.

ItistheintentoftheWisconsinHistoricalMuseumthat

thisguideserveseducatorsandstudentsinproviding

object-basedlessonstobeusedaftervisitingand

experiencingthemuseumonafieldtrip.Ourfieldtrips

supportCommon Core English Language Arts Standards

forReading:InformationalTextandSpeaking&Listening

standardsaswellasCCSSforEnglishLanguageArts&

LiteracyinHistory/SocialStudies.

Educatorsshouldusethisguideasapost-museum

visitactivity.Itwillcontinuetochallengestudentsto

“ThinkLikeaHistorian”byencouragingthemtothink

critically,makepersonalconnectionswithhistory,andto

evaluateinformationbyasking“why”,“how”,andmost

importantly,“Howdoyouknow?”

Background Information

Inearlyhumansocieties,peoplepaidforgoodsandserviceswithobjectsofphysical

value,suchasbarteredgoods.Overtime,governmentsbeganissuinguniformcoins

madeoutofpreciousmetalwhichwereeasiertocarryaroundandexchange.Their

uniformshapeandsizemeantthateachpiececouldeasilybeassignedavalue,unlike

randomly-shapedchunksofgoldandsilverwhichwouldneedtobeweighedand

appraisedindividually.Eventually,coinscametobemadeofnon-preciousmetalslike

copperandnickel,butcouldstillberedeemedfortheirequivalentvalueingold.Paper

money,called“notes,”wasoftenusedaswell,especiallyforlargerdenominations.

Althoughthecoinsandpapernotesthemselveswerephysicallyworthless,they

representedvalue.IntheUnitedStates,thefirstnationalcurrencywasissuedbythe

FirstBankoftheUnitedStates,formedin1791.TheFirstBankwasallowedtoexpire

afterits20-yearcharterwascompletedandwasreplacedbytheSecondBankofthe

UnitedStatesin1816.

PresidentAndrewJacksonstronglydistrustedtheSecondBankoftheUnitedStates

andrefusedtorenewitscharter.Thebankwasconvertedtoaregularprivatebankin

1836andwentoutofbusinessin1841.Becausetherewasnolongerafederalbanking

authority,stategovernmentstookoverthejobofsupervisingbanks.Thissupervision

oftenprovedinadequate.Inthosedaysbanksmadeloansbyissuingtheirowncurrency.

These“banknotes”weresupposedtobeconvertible,ondemand,tocash—thatis,to

goldorsilver.Itwasthejobofthebankexaminertovisitthebankandcertifythatithad

enoughcashonhandtoredeemitsoutstandingcurrency.Becausethiswasnotalways

done,manybanknoteholdersfoundthemselveswithworthlesspaper.Itwassometimes

difficultorimpossibletodetectwhichnotesweresoundandwhichwerenot,becauseof

theirvariety.

By1860morethan10,000differentbanknotescirculatedthroughoutthecountry.

Commercesufferedasaresult.Counterfeitingwasepidemic.Hundredsofbanksfailed.

Throughoutthecountrytherewasaninsistentdemandforauniformnationalcurrency

acceptableanywherewithoutrisk.Inresponse,CongresspassedtheNationalCurrency

Actof1863.In1864,PresidentLincolnsignedarevisionofthatlaw,theNational

BankAct.Theselawsestablishedanewsystemofnationalbanksandanewgovernment

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agencyheadedbyaComptrolleroftheCurrency.TheComptroller’sjobwastoorganize

andsupervisethenewbankingsystemthroughregulationsandperiodicexaminations.

Ultimately,thenationalbankinglegislationofthe1860sprovedinadequateduetothe

absenceofacentralbankingstructure.Theinabilityofthebankingsystemtoexpandor

contractcurrencyincirculationorprovideamechanismtomovereservesthroughoutthe

systemledtowildflowsintheeconomyfromboomtobustcycles.

AsAmerica’sindustrialeconomygrewandbecamemorecomplextowardtheendofthe

19thcentury,theweaknessesinthebankingsystembecamecritical.Theboomandbust

cyclescreatedbyaninelasticcurrencyandimmobilereservesledtofrequentfinancial

panics,whichtriggeredeconomicdepressions.Themostseveredepressionatthatpoint

inU.S.historycamein1893andleftalegacyofeconomicuncertainty.

OnDecember23,1913PresidentWilsonsignedintolawtheFederalReserveActof

1913.Thepurposesofthiswasactwere“toprovidefortheestablishmentofFederal

ReserveBanks,tofurnishanelasticcurrency,toaffordmeansofrediscounting

commercialpaper,toestablishamoreeffectivesupervisionofbankingintheUnited

States,andforotherpurposes.”

IntheUnitedStatestoday,theFederalReserveBankregulatestheamountofcurrency

thatismadeanddistributedbytheBureauofPrintingandEngraving.Weusuallycall

theseFederalReserveNotes“dollars.”AllFederalReserveNotesintheUnitedStates

haveemblemsindicatingthattheyareissuedbytheFederalReserve.Thevaluesof

thesenotesarealsoclearlyprinted,andtheyincludesecurityfeaturestoreducethe

riskofforgery.Whilebanknotesarenolongerconsideredlegalcurrency,theymayhave

acquirednumismaticvalue;thismeansthattheyarevaluabletocollectorsbecauseof

theirhistoryandbecausetheyaresorare.

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Images for the Classroom

Wisconsin Bank Notes, 1852 (WHi Image ID: 38558). Proofsheetsoffive-andten-dollarbillsoftheWisconsinBankofMadison.Amongotherillustrations,thenotesincludeanengravingofLeonardJ.Farwell,GovernorofWisconsinin1852,andavariationoftheStateSeal.

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Student Activity

Introducestudentstobanknotesbyusingtheteacherbackgroundinformation.Then

projectorshareaphotocopywithstudentsofWisconsin Bank Notes(WHiImageID:

38558)withstudents.Askstudentstoreviewtheimageandsharewithaclassmate

similaritiesordifferencestocurrentUScurrency.Givestudentsplentyoftimeto

respondbeforeintroducingthediscussionquestions.

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Teacher-led Student Inquiry and Analysis Questions

1. Whydoyouthinkpeoplewouldprefertousepaperbanknotes

insteadofcoins?

2. NameonesimilarityandonedifferencebetweenaUSdollar

andabanknotefrom1852?

3. Iftimeallows,havestudentsresearchtheNationalCurrency

Actof1863.HowdidtheNationalCurrencyActof1863

transformthewaybanksandcitizensdobusiness?

4. Whyisanationalcurrencyimportanttoanation?

Bibliography and Additional Resources

ImagesandobjectssharedinthisdocumentcanbefoundonthefollowingWisconsin

HistoricalSocietywebpages:

Wisconsin Historical Imageswww.wisconsinhistory.org/whi/

Curators’ Favoriteswww.wisconsinhistory.org/museum/artifacts/

Additionalinformationcanbefoundat:

Comptroller of the Currency Administrator of the National Banks

www.occ.treas.gov/index.html

National Bank History

www.nationalbankhistory.com

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01.25.11

TheWisconsinHistoricalMuseumisinterestedinhearingmemoriesoffavoriteexperiencesorexhibits.Havestudentsusethenextpagetoillustrateanddescribewhattheyenjoyedmost.Pleasereturnto:

Museum Education

Wisconsin Historical Museum

30 N Carroll Street

Madison, WI 53703

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Reflection

Pleaseillustrateyourfavoriteexhibitinthespacebelow.

Pleasedescribewhyyouenjoyedthisexhibitthemost.

Name

Date

Teacher