Congress has used four main methods to…
1783 CE
Congress had made two issues of paper money—in 1775–1780 and in 1780–81.
The first issue amounted to two hundred and forty-two million dollars.
This paper money would supposedly be redeemed for state taxes, but the holders will eventually paid off in 1791 at the rate of one cent on the dollar.
By 1780, the paper money was "not worth a Continental", as people said.
The skyrocketing inflation had been a hardship on the few people who had fixed incomes—but ninety percent of the people are farmers, and had not been directly affected by this inflation.
Debtors had benefited by paying off their debts with depreciated paper.
The greatest burden has been borne by the soldiers of the Continental Army, whose wages were usually in arrears and declined in value every month, weakening their morale and adding to the hardships of their families.
Beginning in 1777, Congress has repeatedly asked the states to provide money, but the states have no system of taxation either, and are little help.
By 1780, Congress was making requisitions for specific supplies of corn, beef, pork, and other necessities—an inefficient system that had kept the army barely alive.
Starting in 1776, the Congress sought to raise money by loans from wealthy individuals, promising to redeem the bonds after the war.
The bonds will in fact be redeemed in 1791 at face value, but the scheme had raised little money because Americans had little specie, and many of the rich merchants were supporters of the Crown.
Starting in 1776, the French secretly supplied the Americans with money, gunpowder, and munitions in order to weaken its arch enemy Great Britain.
When France officially entered the war in 1778, the subsidies continued, and the French government, as well as bankers in Paris and Amsterdam, lent large sums to the American war effort.
These loans will be repaid in full in the 1790s.
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