As president of the State Bank of Indiana, Hugh McCulloch first came to Washington to protest Secretary of the Treasury Salmon P. Chase's National Banking System. Ironically, Chase asked McCulloch to launch the system in 1863 1863 as the first Comptroller of Currency. After some hesitation McCulloch accepted, and the system was largely successful due to his influence with existing state banks. McCulloch became President Lincoln's Secretary of the Treasury in 1865 and continued in office under President Andrew Johnson.
Immediately confronted with inflation caused by the government's wartime issue of greenbacks, he recommended their retirement and a return to the gold standard. However this would have reduced the supply of currency and was unpopular during the period of postwar reconstruction and westward expansion. Adopted in 1866, the gold standard was abandoned two years later and the battle over its revival raged for the next fifty years . During his tenure, McCulloch maintained a policy of reducing the federal war debt and the careful reintroduction of federal taxation in the South. McCulloch was appointed Secretary a second time in 1884 by President Chester Arthur. During his six months in office at that time, he continued his fight for currency backed by gold, warning that the coinage of silver, used by then as backing for currency, should be halted.
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of the Curator
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