COVID-19 has revitalised the debate over how best to encourage economic activity, mitigate the effects of recession, and return the economy to normal. Alongside this, many are asking whether a return to “normality” is what we want, or if we can use this crisis as an opportunity to build a fairer, more compassionate economy.
This debate has given renewed attention to a plethora of old and new ideas. Vouchers, grants and loans have been suggested as a way to stimulate the economy. After a decade of austerity, Keynesian ideas about economic recovery seem to be creeping back into the political discourse, and many are keen to utilise this opportunity to “Build back better”.
Local currencies have been pointed to as a way to encourage healthy, sustainable growth and rejuvenate communities that have been affected by the virus. One example of this comes from across the pond, from a rural community called Tenino in Washington State who have started printing their own currency in order to support struggling businesses and distributed up to $300 a month of it to each of the town’s poorer residents.
Despite having a population of less than 2,000, the town has attracted international media attention and sparked a debate over the use of local currencies. What lessons can be learned from this small town in the Northwestern USA?
The story of Tenino’s wooden money begins ninety years ago, during the Great Depression.
The rural settlement was hit hard by the Depression and saw a huge rise in unemployment and poverty. In December 1931, the town’s only bank closed down, leaving hundreds with no means of financial support. Using an old-fashioned newspaper printing press, the residents of Tenino began producing their own wooden notes which could be circulated around the local economy, giving much needed relief to the town’s residents and businesses. By 1933, around $6,500 dollars’ worth of Tenino tender had been printed. Not only did this boost the local economy but, as news of the experiment spread, made the small town famous. As Tenino’s current mayor Wayne Fourier puts it, news of the currency “went 1930’s viral.”
It was Wayne Fourier who suggested bringing back the famous wooden currency as a way to stimulate the town’s economy after the devastating effects of Covid-19.
After sitting dormant for 90 years in the town’s small museum, the same printing press was brought back to life, and is now being used to produce the new Tenino notes. Similar to the originals, these $25 notes feature the words “Covid Relief” above the latin phrase “Habemus autem sub potestate”. Roughly translated: “We’ve got it under control.”
After having to close for a long period of time due to COVID-19, many of Tenino’s companies fear that, without a significant increase in profits, they may have to close their doors permanently. Although the businesses are coming back to life, demand hasn’t caught up yet; with a nationwide rise in unemployment, people simply have less money to spend.
For this reason, the city council decided to set aside a fund of $10,000 to distribute to poorer residents in the form of wooden Tenino vouchers. Every resident that lives below the poverty line and has been in some way affected by the pandemic can receive up to $300 a month. The money is intended to help with essentials, but can be spent on anything (excluding cigarettes, alcohol and lottery tickets) in almost any of the town’s shops. The shops can then submit redemption requests to convert the notes back into cash.
As Wayne Fournier puts it, “Amazon will not be accepting wooden dollars” and this is precisely why the idea works. By distributing wealth that is restricted to the local area, the resulting economic growth is beneficial for both local consumers and businesses. To quote Tenino shopkeeper Chris Hamilton, “it helps promote the small town and keep business local. It’s a two-fold win for people.”
Following the attention and excitement garnered by the currency, Fournier suggested the possibility of continuing the project after the pandemic passes:
“We’ll run out this program, and then we’ll look into having our own city currency.”
The use of alternative currencies to promote healthy economic recovery is not a new idea. Tenino was one of many US towns that began using local currencies during the Great Depression. In 1930’s Austria, the town of Wörgl printed its own notes to help save its dying industries. More recently, the Greek TEM currency was set up to support the residents of Volos after the financial crash.
History provides us with countless examples of communities finding innovative local solutions to wider economic problems. Now, Wayne Fournier hopes that Tenino can once again encourage others to take matters into their own hands; “You’ve got to pull yourself up by the bootstraps,” he said, “If we can inspire other communities to do that, we’re all going to be better off.”