THE TOO-POPULAR DOLLAR BILL
THE DOLLAR IS A GREAT WORRY to Uncle Sam, just as it is to most private citizens, because it does not last long enough. The dollar bills are wearing out so quickly that the printing-machines can not keep up with the demand.
The economizers in Washington tell us that the printing bills for turning out so much new paper money are becoming a real drain on the taxpayer. Last year, according to a writer for the New York Times, the Government made five new one-dollar bills for every man, woman, and child in the country, at a total expense of $4,000,000. A while ago, the Treasury experts begged us to use the big silver "cartwheel" dollars so as to save the wear and tear on the dollar bills. This campaign, according to all newspaper reports, was a flat failure. Now comes the appeal to use more two-dollar bills and fewer ones. We now have in circulation only 8 two-dollar bills for every 100 one-dollar bills. If we were to raise the proportion to 36 twos for each 100 ones, it would save the Government, if we may trust the mathematics of the Times writer, a round million dollars per annum. We are now using seven times as many dollar bills as we did seven years ago, and our population has not increased in any such proportion. An explanation is offered by the Indianapolis Star:
"The war developed the cash-and-carry principle in merchandising, with more demand for ready cash. The automobile probably ranks as the most influential contributing factor toward a greater demand for dollar currency. The city motorist uses it in his dealings with the filling station, and the long-distance tourist must have it in the less populous districts, where he sometimes has difficulty in getting the larger bills changed. The increased population and the larger per capita earning capacity, with a more liberal margin of daily spending money, require more cash."
So people have acquired the habit of carrying a large number of ones, instead of fewer bills of higher denominations. The United States Bureau of Efficiency issues a public statement declaring that "the foolish superstition that the two-dollar bill is unlucky should be brushed aside in the interest of money efficiency." Everybody is asked to use the least possible number of bills in making change, in order to—
"Decrease the bulk of currency to be carried in people's pockets.
"Decrease the bulk of currency to be handled, carried and kept by change-makers and bank-cashiers; and also to decrease the chances of making mistakes.
"Decrease the bulk of money to be manufactured by the Bureau of Engraving and Printing, and directly save the Government possibly one-fourth the cost of this manufacture."
This appeal will probably fall on deaf ears, thinks the Philadelphia Public Ledger. As an editorial in the Vanderbilt newspapers reminds us, a canvass recently made in New York City -"among bank-cashiers, restaurants, railroad-stations and ticket agencies brought the unanimous verdict that the Government could not succeed in popularizing this currency." The Treasury, remarks the New York Evening Post, "will discover that battling a superstition is as hard as conquering the bootlegger." The case against the two-dollar bill, says the New York Journal of Commerce, is simply that "people refuse to use them because they are not adapted to our price system, and do not fit in with our regular units of payment." The real reason for the unpopularity of the two-dollar bill, says the Rochester Democrat and Chronicle, "is that there is such a close resemblance between the ones and twos now in circulation, that mistakes or fraud are easy with resulting short change to the victim." So The American Banker comes to the conclusion that while increased use of two-dollar bills would make things easier for the Treasury Department, it is more likely that in the end "the two-dollar bill will entirely disappear." And after all, concludes the Nashville Banner:
"The people are entitled to have what they want. It may save expense to substitute two-dollar notes, but such a denomination will find a fretful public, and the substitution will, therefore, be a very bad arrangement."
Source: The Literary Digest for September 12, 1925