Why did populist precursors defend the inclusion of paper money at the Constitutional Convention?

Populist precursors defended the inclusion of paper money at the Constitutional Convention because paper money helped regular people, like farmers, pay their taxes and debts.

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The Constitutional Convention took place in 1787, around 11 years after the United States officially declared independence from Great Britain. At this time, populism as we today understand it was not apparent. In other words, there was no official populist party at the Constitutional Convention. There wasn’t a formal group or organization that identified as populist and participated in the Convention. One would have to look ahead to the mid-1800s to identify the arrival of political parties that had explicit populist agendas.

However, it is possible to talk about why precursors to populism would defend a state’s ability to issue paper money.

In the late 1700s, many ordinary people were farmers, and they were struggling. America’s War of Independence with the British left the country with lots of debt and provoked Britain to shut them out of various trading enterprises.

To lessen their debts, states increased taxes. A fair amount of farmers could not afford to pay the higher taxes and ended up losing their farms. To combat the financial stress, states began to issue paper money, which helped the farmers pay their taxes and their debt.

In this context, paper money can be seen as a populist concern because it benefits common people. It’s a development that helps the everyday person and not the elite. Those who opposed paper money were reviled; they were called “flint-hearted misers” and described as predators.

When Edmund Randolph, the governor of Virginia at the time, introduced the Virginia Plan at the Convention, he decried the prevalence of paper money. According to Randolph, paper money brought “havoc.” His stance, in hindsight, can be seen as anti-populist. Again, populists, or what might pass as populist in 1787, would defend the use of paper money because it helped ordinary people.

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