The U.S. Treasury

On this day in 1862 the United States Treasury issued paper money, or "Greenbacks"  ($1, $5, $10, $20, $50, $100, $500 and $1000) for the first time, replacing State bank notes and 'Demand Notes', which were issued during the Civil War.

I don't know whether there was a national debt at that time, but I would imagine it was nowhere near what it is today.