Sharon Ann Murphy, a professor at Providence College, has written an excellent introduction to the monetary and banking history of the United States from the Revolution through the Civil War and, with more limited coverage, through the founding of the Federal Reserve. The scope of this short book is extensive. We meet the famous politicians and financiers who left their imprints on the banking system: Alexander Hamilton, Andrew Jackson, Henry Clay, Salmon P. Chase, Nelson Aldrich, Nicolas Biddle, Jay Cooke, J. S. Morgan, J. P. Morgan, and many more besides. We get short but up-to-date explanations for the causes and consequences of the banking panics of 1819, 1837, 1839, and 1857. The various types of financial institutions are described: the First and Second Banks of the United States, commercial banks of all types including the famous free banks and wildcat banks, savings banks, building and loans, investment banks, note brokers, and so on. And we learn about war finance during the Revolution, the War of 1812, and the Civil War. The famous “Bank War,” in which Andrew Jackson succeeded in getting rid of the Second Bank of the United States, is given especially detailed treatment. It is a large agenda. Of course, on any one of these issues a specialist might disagree with Murphy's interpretation. There are, moreover, few footnotes documenting the underlying research. In most cases the reader is simply asked to take Murphy's word that she is accurately conveying the academic consensus. But I am familiar with a good bit of this literature, and I believe that on the whole Murphy does a good job of summarizing the current state of academic thinking on each of these many issues.

Murphy also includes a short description of (one is tempted to write homage to) Louis Brandeis's book Other People's Money. And at the end she includes an interesting discussion of how Jackson, who didn't like banks, ended up on the twenty-dollar bill and why Harriet Tubman makes a good replacement. Jackson is there partly because when portraits were being chosen, another two-term nineteenth-century Democrat was needed; that meant Jackson or Grover Cleveland. One fascinating story about Tubman that resonates with her choice as the new face on the twenty-dollar bill is that she once encamped in the office of a prominent abolitionist demanding exactly twenty dollars for an expedition to rescue her parents, an expedition that was ultimately successful.

The book is not intended for academics, at least not for those whose research is focused on these issues. Rather, it is intended, I believe, as a supplementary text for college students taking a course in nineteenth-century American history. It also might be useful to academics who work on other aspects of the antebellum period, say, on the political history, but who would like a short nontechnical introduction to the monetary and banking questions. And of course, it is intended as well for the proverbial intelligent layperson.

There are no tables or charts, indeed, few numbers of any kind. Presumably the book was written for an audience that would find such things off-putting. There are judgments about quantities, but one has to trust Murphy as to whether things were large or small. On the other hand, Murphy has a gift for illustrating complex ideas with well-chosen examples, references to novels, and examinations of the fascinating and detailed cartoons that appeared in the press. It's a good read.

The macroeconomic framework is the traditional monetarist approach of Milton Friedman and Anna Schwartz, and their colleagues: (1) Inflation is a monetary phenomenon that results when the supply of money rises faster than the demand for money. (2) The supply of money in turn is the product of the monetary base (which in the nineteenth century was gold and silver in peacetime and fiat money in war) and a money multiplier determined in part by the structure of the banking system and the public's preferences for cash. (3) Banking panics arise because a fractional reserve banking system is inherently unstable. Panics can be made less likely by appropriate regulation, but when they do happen they should be met aggressively by a central bank acting as lender of last resort. When it comes to the money multiplier, Murphy defines terms differently than do Friedman and Schwartz, or than they are defined in contemporary money and banking textbooks, but the basic ideas are similar. However, Friedman and Schwartz, and other monetarists, are never mentioned by name. Perhaps for historians in history departments these names, especially Friedman's, have become a bit like that of Voldemort: He Who Must Not Be Named.

The book is dedicated to Murphy's father and to Professor John James, who was Murphy's undergraduate mentor at the University of Virginia and who passed away recently. James was an old friend of mine. He was widely admired among economic historians for his many contributions to monetary and financial history. He might have disagreed with this or that conclusion, and this book is not the kind of quantitative and econometrically sophisticated work that James was famous for, but I think he would have been very proud of the book that he helped to inspire.

I recommend Other People's Money highly to anyone seeking a brief but accurate introduction to this fascinating era in banking and monetary history.