Wars are expensive. That’s something the United States found out during the American Civil War in the 1860s. And to pay for it, the government – the Union one, that is – introduced a special tax. People don’t much like taxes now, and they didn’t then.
So, the question was, how do you tax the people to fight a war, and get them to like it? The answer: ‘war bonds’. You borrow from your taxpayers as a patriotic act, and you pay them back (hopefully) with interest in the money they give you in taxes.
That’s what President Woodrow Wilson’s government attempted to do after it declared war on Germany in 1917. The only problem was, the citizenry didn’t really buy in to the idea – literally. There were better investments elsewhere.
The government decided to bring out the big guns and do what the United States does best – combine finance with a large dose of New York-style razzamatazz.
On 7 April 1918, a bunch of A-list celebrities were drafted in to sell the idea of war bonds to the public. The line-up featured the stars of the silver screen: Charlie Chaplin, Mary Pickford and Douglas Fairbanks. And, of course, it wasn’t war bonds the government was selling – they were ‘Liberty Loans’.
The New York Times reported on the day’s events: “The promise of Charlie Chaplin – not to mention a hint that Mary Pickford might grace the occasion – tied up traffic in the financial district in a knot that the police reserves could not undo… Old George Myles, who has guarded the front hallway of JP Morgan & Co’s offices for years, said he had never seen a crowd which approached yesterday’s for density.”
Military bands marched down Wall Street, and every time $1,000 was invested in the bonds, the Liberty Bell was rung in City Hall, which “…rung ten times between the hours of 12 and two o’clock”.
Not one to be outdone, Chaplin even produced and acted in a short film to showcase the war bonds, imaginatively called The Bond. It explored the various types of bond: friendship, marriage, but best of all, the Liberty Bond.