Scrip (by Irving Fisher, 1933)
III. SUGGESTED FORMS
Adopted from form used by Mr. H. C. Parmelee, Fort Smith, Ark.
The Stamp Scrip Plan
Stamp Scrip is originated and put into practise for the purpose of providing
unemployment relief, and to stimulate trade. As a new, painless tax paid
from new, additional profits it affords a means of relief from other forms
of taxing for unemployment relief purposes, and distributes such tax payments
over a wider area.
The Stamp Scrip plan is put in effect as a number of people-grocery stores, dry-goods stores, clothing stores, butcher shops, hardware stores, mechanics, garages, bakeries, doctors, lawyers, dentists, beauty parlors, real-estate owners, farmers, plumbers, laborers, lumber-yards, etc. - mutually agree that they will accept this substitute for legal tender in all the trades they are able to make among themselves.
Stamp Scrip wail resemble an ordinary bank bill. It will have the denomination stamped on its face. On the back of the bill, however, will appear 52 small squares.
Each square will have a date on the inside. These dates will be for some particular day of the week (say Wednesday) for 52 weeks of the year.
Suppose you were to receive one of these new dollars on Thursday. By reason of the agreement already made, you could spend this dollar for anything you needed with any of the dozens of people previously mentioned. It would pass for a full dollar on every day up until the following Wednesday, which is, let us say, February 8th.
On that day you must purchase from the central office, or elsewhere where offered for sale, a special stamp put out by the central office. For this stamp you must pay 2 cents in legal tender. If you do not this, the next man need not accept your scrip dollar for more than 98 cents.
Whoever holds the scrip dollar on Wednesday must put on of these special 2-cent stamps. When it has circulated for the 52 weeks of the year, the central office has collected $1.04 in legal tender money.
This money has been kept in a special fund. Now the man who receives the dollar with 51 stamps on it may place a 2-cent stamp in the last square, take it to the central office and receive a legal tender dollar in place of it.
Thus it is self-redeeming because as it travels from week to week, it accumulates each week 2-cents which, multiplied by the weeks of the year, will provide 100 cents in legal tender money to take it up - with 4 cents left over.
This 2% tax is not a 2% sales tax. The stamp needs to be put on but once a week. During the week the dollar may enable 10 or 20 transactions to take place. The tax for that week would be only 2 cents divided by the number of times it changed hands.
You cannot hold the Stamp Scrip bill, unless you pay 2 cents each week. The 2-cent stamp is a 2% tax on hoarding. It will be the tendency to get rid of the dollar and let the other fellow put on the tax.
This will help to speed business up. It makes things move very briskly. In ordinary times legal tender money turns over once or every two weeks. In depressions it turns over much more slowly. Hoarded money doesn't turn over at all. Self redeeming scrip money would doubtless turn over several times each week.
Stamp Scrip may be put into circulation in several different ways:
1. The City may issue it in payment of wages, salaries or materials.
It may be used in these ways in lieu of taxes. The citizens by agreeing
to accept it, virtually buy it from the city and pay their taxes in small
installments at the rate of 2 cents on the dollar each week. The City of
Evanston, Ill. is using it in this way. The City of Hawarden, Ia., first
introduced it in this manner. Many other cities are so using it.
2. The Stamp Scrip may also be loaned to merchants. They agree to pay their loans at a later date in scrip, without interest. They may use it to pay wages, local bills, etc.
3. Stamp Scrip may also be safely loaned to others, preferably for purposes that would put unemployed people to work and thus place needed purchasing power in their hands.
A building owner might borrow some of the scrip and hire idle carpenters, plumbers, painters and masons to repair a building.
A farmer might borrow some of it with which to have a truck repaired at the garage so that he might haul his crops to the market.
The loans could be safely made to reputable persons, known to pay their debts, without the security required by a bank.
Its effect upon ordinary money is to bring more legal tender money back into circulation. A great deal of legal tender money is being hoarded because people are afraid they can't get more of it. When something that performs all the functions of money begins to get plentiful, people lose their fear and put their legal tender dollars to work.
It also tends to unlock bank credit. The Stamp Scrip is injected into the consuming end of the economic circle. It begins to get action at once. Demand is created. Goods are taken off of shelves - begin to get used up.
Then there is a genuine need for production to start again. The merchant and manufacturer now find the banks bulging with credit, and the banks are eager to loan them credit.
The credit made available by the banks and the Federal Reserve, etc. must start from the producing end. This is a long way from the consumer. The consumer can't get hold of any kind of credit the banks and Federal Reserve control.
The Stamp Scrip plan permits this consumer to get credit - money - which he can get in no other way. Production can't start again until consumption begins to make way for new goods.
FORM OF PETITION
In Hawarden the following petition was circulated among the merchants and presented to the city officials:
"TO THE HONORABLE MAYOR AND CITY COUNCIL OF ..................
Realizing that unemployment seriously affects the community and desirous of trying ways and means of relieving hardships and stagnant conditions, we the undersigned hereby petition the city council to promote local employment plans and use as a mode of payment for same, selfredeeming coupons good only locally, the user to affix a three cent redemption stamp to each, at the time of cashing same for merchandise or services.(2)
WE ALSO AGREE TO USE AND ACCEPT THESE COUPONS IN OUR OWN TRANSACTIONS."
FORM OF PLEDGE
Each of us agrees that for one year from . . . . . . . . . . . . . 19...,
we will, in our business, receive at face value the "Stamp Scrip" as explained
in the "Prospectus A" of . . . . . . . . . . . . . and to be issued by
. . . . . . . . . . . . . . . . . . . . and will comply with the rules
as set forth in the Stamp Scrip prospectus which includes a replica of
the scrip . . . . . .
"Two Pennies a Week will Provide . . . . Dollars a Week for the Unemployed."
"Stamp Your Scrip to Stamp out the Depression."
"HOW TO USE UNEMPLOYMENT RELIEF SCRIP
"This scrip may be used for purchases, payments and other transactions provided it is 'stamped' to date.
Every Wednesday is Stamping Day. A stamp amounting to 2% of the face
value of the scrip (1 cent for a 50 cent bill - 2 cent for a $1 bill, 10
cent for a $5 bill) has to be pasted on the back of each bill in the space
on which the date of that Wednesday is printed.
These stamps may be purchased from the City of . . . . . . . . . . . or from all stores and other business places which display the sign 'Scrip Accepted - Stamps Sold.'
"Accept scrip like ordinary money, and induce others to accept it. It has been issued to relieve unemployment and suffering among the citizens of ...........
"Use your scrip in as many different ways as possible, and, in passing it on, divide it among as many different people as possible, and in as many different lines as possible.
"Your cooperation in accepting this scrip gives work, food and clothing, and helps to bring back better times."
STAMP YOUR SCRIP TO STAMP OUT THE DEPRESSION
Sample of a poster to be exhibited in the windows of the cooperating store:
-Stamps Sold -
Every Wednesday is Stamping Day
Stamp out the Depression
I have gotten letters from a great number of people saying that they have independently formulated similar plans. While it is possible that in my overwhelming correspondence on the subject one or the other of these plans have escaped the proper attention, I want to mention the following:
A. H. ARMINGTON
R. S. ASPINWALL
EARL S. BARKER
COLIN H. BURNELL
RALPH E. COURTNEY
WALTER T. DAY
FRED J. ELLIOTT
DR. HUGO R. FACK
E. S. HAMMOND
L. C. HARDIE
CLAUDE C. HOBSON
O. O. HOBSON
PETER N. JANS
JAMES A. LUKE
WILLIAM ADDIS OSBORNE
PAUL WILLER PETERSEN
J. RICE SCOTT
P. R. STRINGER
(2) Should be changed to apply the Woergl or dated type of scrip.