Money Rant Two: America Could Plan Once

In the previous money rant, I finally addressed Lesson Nine from this list of potential rants. It’s time to move on to a more positive one. Let’s talk about a time when America had its shit together, The Great Depression. No, really. I’m not kidding.

Much as we may deride President Woodrow Wilson for other very racist things, the League of Nations was a great progressive idea. Unfortunately, Great Britain and France wanted to see Germany burn at the end of World War I, so it all fell apart promptly. It’s understandable but the American government was left throwing its hands in the air and saying, more or less to quote Cartman, “Screw you guys, I’m going home.” Admittedly, a Congress that felt that America had no business in Europe, other than Business, had no interest in it. Also, they wanted their war loans that they gave to the Allies paid back; a creditor/debtor relationship does not make for good international relations. But that doesn’t mean that the machinery of American government wasn’t looking around and paying attention. Okay, to be fair, it didn’t do much until FDR got into office. The Harding, Coolidge and Hoover administrations were, in short, pretty excited about things going on in America and hegemony in the Caribbean, less so further afield.

But come 1933, by my general feel of history, an American generation that had not been listened to during and in the wake of WWI found itself in power and said collectively to themselves, “Let’s not do that again. Also, this Depression sucks.” There may also have been a glance over toward Europe with a wince and the pained teethsucking noise of “Oooo, ouch. Well, at least we aren’t Europe. We tried to tell ’em. This Hitler guy seems to be a bit of a dick and, MAN, do we not like what Japan is up to over there. They better not fuck with the Philippines, we just finished pacifying that a little while ago. Invented ridiculously high caliber guns to do it and everything.” While trying to figure out a way out of the hole America had fallen into and fix the myriad problems, the New Deal bureaucracy FDR’s administration assembled was thinking big. Beyond the borders of America big. How to win the peace of the next war big.

Since you’ve read this far it shouldn’t come as big surprise the answer to this was money.

The idea they came up with was called Provisional Currency*. Cash that the United States could bring with them to a war theater and instantly reconstitute an economy that we could participate in and bring into the American sphere of influence. Oh sure, it would obliterate the previous economy that was there but the US Army isn’t completely dim, they would happily exchange the old precious metal currency that may have remained for the Provisional Currency. But more importantly, if the US lost and had to abandon territory (unthinkable!!!) this was currency that was different than normal domestic US legal tender which could be disavowed. We could easily say “Things that look like $QUALITY? NOPE, those aren’t valid anymore. You sure do have a lot of these, Mister… [reads passport closely] Berwin Rommelle?”

Let’s have a compare and contrast moment starting with a pre-Monopoly money five dollar bill.

Five Dollar Federal Reserve Note, Obverse, Series of 1963A (from the Broughton Collection)

Please note the specific wording used on this bill. It is a “Federal Reserve Note” worth “Five Dollars” and “This Note Is Legal Tender For All Debts, Public And Private”. I don’t want to start a fiat currency argument here, but let’s just leave it at this bill is worth five bucks but it’s some what nebulous what exactly a dollar is. Prior to 1964 and the demonetization of silver, we had had another kind of bill called the silver certificate. This bill was worth its stated value but you could exchange it for an equivalent amount of legal tender in silver, i.e. coins. While I don’t have a crisp normal five dollar silver certificates in my collection, I do have a one dollar silver certificate.

One Dollar Silver Certificate, Obverse, Series of 1957 (from the Broughton Collection)

While the statement about legal tender is there, you can see some differences. First off, rather than saying “Federal Reserve Note” it has “Silver Certificate” at the top. Instead of just declaring ‘The United States of America”, in case you forgot which nation would put Lincoln and Washington on its money, the words “This Certifies That There Is On Deposit In The Treasury Of” above it to make a leading statement that continues with the additional words below. Instead of just saying “One Dollar”, we also promise “In Silver Is Payable To The Bearer On Demand”. The earliest versions of the silver certificates were missing the statement about deposit with the Treasury which, technically, meant every single bank had to maintain sufficient silver on hand to cover every yahoo that wanted sacks of coins rather than bills. This lead to all kinds problems, hence the change, but that’s a different story that involve bank runs, bankruptcies, bank robberies and other phrases that involve the word bank. But the most plain difference between the two different kind of bills was the color of the seal and serial number: federal reserve notes were green, silver certificates were blue. Similar to the silver certificates, there had been gold certificates with a yellow seals and serial numbers, but gold was demonetized in 1933 and the gold certificates discontinued. This meant that in 1934 the color yellow was available to use to do this.

Five Dollar Silver Certificate Provisional Currency, Obverse, Series of 1934A (from the Broughton Collection)

The appearance of this bill is inconsistent. You have all the silver certificate language. You’ve got serial numbers done in blue, like a silver certificate should have, but then you’ve got this giant yellow seal like it should be a gold certificate. In short, it’s weird and sticks out like a sore thumb in any stack of money. As long as we all agree it’s valid money, it’s valid, but it’s really easy to tell people what to confiscate/ignore if you disavow it. This is the original Provisional Currency that the United States printed up in preparation for the next time they had to occupy a country and had it available in $1, $5, and $10 denominations. Please take a moment and look at the year.

Yes, that’s right. You read that correctly.

NINETEEN FUCKING THIRTY FOUR! WE HAD THIS READY FOUR YEARS BEFORE THE FUCKING NAZIS ANNEXED AUSTRIA, MUCH LESS ANYTHING ELSE. SEVEN YEARS BEFORE GODDAMN PEARL HARBOR.

[takes to deep breath and a swig of bourbon to calm down]

Not that we actually used them until 1943 after Gen. Patton landed in North Africa, which is why the yellow seal silver certificates are colloquially known as North African bills. As the story goes, the first wave of landing ships dropped off Patton and his tanks and the second wave brought the pallets of cash. I don’t believe that for a second, but it’s a nice story. Actually, the funny thing is that they’re known as North African bills and not Reconstruction bills because there was a diplomatic rift about whether to use them in an increasingly liberated France. Use ’em in Africa and Italy? No problem. France? SACRE BLEU, NON! As an empirehaver that intended to get its empire back once this “small German embarrassment” was resolved, France wanted to make sure the Francophone world that looked to Paris for authority also recognized the supremacy of the Franc, so no yellow seal bills for France.

But those are all game time decisions when you roll the Provisional Currency out. The fact of the matter is that we had it and had been sitting on the final printed product for almost a decade before using it. We were ready. We had the experience, we knew how the economy got disrupted in war, and we knew how to start putting things back together and make friends (okay, that term might be a bit strong) while doing it. Even if you take the usual black market and profiteering into account, they’re working with with the currency and formal markets we created because nothing else works at the moment and that, sort of, makes even the criminals our allies. Rather than pillaging the treasuries of conquered lands and replacing their money with pot metal, which is what the Nazis & Fascists did everywhere they went and their Occupation Currency coins are fucking garbage, we dropped a limited functionality Army-driven American economy on them. When you stack things like the much grander Marshall Plan on top of this after the war is over, you start to marvel that America used to have an incredibly competent leadership across the entire span of government in career, appointee and, yes, even elected positions that earned the respect of the entire world.

…and then you look at Vietnam, Afghanistan, and Iraq and ask what the hell happened? We walked into Iraq with the assumption oil revenues, oil that wasn’t America’s, would pay for everything. We took planeloads of cash to Iraq & Afghanistan to nominally rebuild them, which mostly vanished back into the coffers of American contractors, sucking the air out of the local economies rather than rebuilding them. How did we clearly learn the lessons of how to win the peace and then forget them so quickly?

I don’t know the answer to this question but I like to look at my yellow seal $5 silver certificate and remember “Once upon a time, America knew how to plan.”

 

 

 


*: Okay, America wasn’t the only nation that thought up provisional currencies but we were the only one that decided to put the full faith and credit of the nation behind it. In fact, America had two provisional currencies, though the second one was a little less planned.

On the other side of the world from North Africa, after Pearl Harbor there was a bit of an “Oh shit” moment with respect to Hawaii as the powers that be considered the real possibility of Japanese invasion of the islands, in particular that this would mean they’d get to seize all the American currency that was there. In January 1942, most all paper currency was withdrawn from the islands with strict limits placed on how much individuals ($200) and businesses ($500, other than payroll) could possess. By June, bills from the San Francisco Federal Reserve Bank showed up freshly stamped with the words “HAWAII” in a particularly unsubtle manner on the front and back with a red seal**. After they showed up, it became illegal to use currency in Hawaii that wasn’t stamped. Just like the yellow seals, if the Japanese managed to capture the islands, all bills stamped “HAWAII” could be disavowed.

One Dollar Silver Certificate Hawaiian Overprint, Obverse, Series 1934A (courtesy of the Langford Collection, photo by Anthony Langford, 2017, all rights reserved)

 

One Dollar Silver Certificate Hawaiian Overprint, Reverse, Series 1934A (from the Langford Collection, photo by Anthony Langford, 2017, all rights reserved)

 

But why didn’t they just use the already made Provisional Currency with the yellow seals in Hawaii? I don’t know the actual justification but I can think of a few reasons. First, they were intended to reconstitute an entire country not, don’t take offense Hawaiian readers, what was at the time a lightly populated island chain of strategic importance but with a comparatively tiny economy. Secondly, and I think more important as I put all scenarios through my Lazy/Horny/Greedy Filter of Human Motivations, the yellow seals were on the wrong side of the Rockies from Hawaii. Much easier to just go grab some of the cash sitting in unused in the vaults in San Francisco and just stamp HAWAII on them than load the yellow seals up on trains, send them west, and then ship them from SF to Hawaii.

After the war was over, they were demonetized and most were burnt, rather than shipped to the mainland for destruction, in the local crematorium and the furnaces of the Aiea sugar mill as fuel. These days, it’s a point of pride in the islands to own any of the old stamped bills.

**: Please don’t ask me to explain where the red seal came from. That is a very ugly discussion in it’s own right and we are well rid of the United States Notes.

 

Good Enough for Government Work

Okay, yet another rant. This is an old saw of mine which I’ve decided I want to write up so I could point at it later.

One of the many places I don’t EVER want to hear this phrase uttered in its current form. (photo courtesy of the Department of Energy)

When I hear someone doing a half-assed job that they’re just going to walk away from, usually incomplete, say with a shrug “Good enough for government work”, I get angry. I get particularly angry if this comes from a co-worker because for the last 15 years, in one form or another, I have either been a state/federal government employee or contractor. My co-worker is, effectively, letting me know that I’m going to need to redo their work, wasting my time, and they think it’s funny as they collect a paycheck doing it. When you add the extra layer of “Dammit you’re supposed to be a steward of taxpayer dollars and government resources, WAIT A MINUTE I’M A GODDAMN TAXPAYER!!!”, well, there’s a reason I asked to be transferred away from certain people. This is the behavior that erodes trust and leads people to think it’s okay to divert money away from government programs to private industry.

NOTE: I have never seen private industry actually do a job they’d been contracted to do work out to be cheaper. Oh, workers were certainly paid less and they had no pension to speak of but somehow the total contact cost never ended up cheaper than the original program. Ah, but this is a different rant.

But let’s talk about the phrase itself, “Good enough for government work.” The original phrase was “CLOSE enough for government work” and it came from the machinist trade. Prior to WWII, FDR’s administration reviewed the state of America’s manufacturing and were a bit disappointed that not much had changed since WWI. In WWI, American troops tended to use British and French artillery and machine guns because our own gear was so deeply unreliable, inferior, and just old by comparison. FDR’s War Department saw the writing on the wall in the 1930s and wanted to get things improved. For a while (so the story goes) there was the general industry machining schedule and the government machining schedule being used side by side*. The idea being that the government schedule would eventually become the industry standard, since you couldn’t get government contracts unless you agreed to meet it and were tooled to meet their specs, at which point the government could go back to buying on the general market rather than demanding special requirements.

Also, as part of the Lend/Lease Act with us selling war materiel to the Allies before Pearl Harbor, the Allies had no interest in buying our crap unless we modernized our production. So, there was that too.

The original meaning of the phrase had an entirely different pejorative. Rather than meaning you’d done a half-assed job, it meant that you’d done such a precise job on this thing you’d made that it could potentially be sold to the government. That its precision could actually meet the exacting standards of the government schedule. It carried the implication of “We aren’t selling to the government, buddy. How much company time did you waste making your work of art when you probably could’ve made 12 more normal ones?”

And this didn’t original sense of the phrase didn’t go away with the end of WWII. My mother told me about working for an early semiconductor manufacturer in Florida that did work supporting NASA. While she wasn’t specifically working on production that was heading to Kennedy Space Center, other people certainly were, so two different quality standards were in use in the fab. She got yelled at by her boss for making wafers that passed through QA with too few flaws. It was assumed that she was wasting time being a perfectionist, despite the production reports and timecards that said otherwise. She was told “This isn’t government work, just get it done.”

I’m not quite sure when the Bizarro semantic shift in this phrase happened but the fact that it did says something. While I would like to blame it on Reagan and the 1981 Air Traffic Controllers’ Strike shattering the strength of unions in America, the change seems to have already happened at some point in the 1970s. The current connotation is corrosive to trust and belief in the machinery of government. It’s an assertion that the people that make up the machine are incompetent at best, malign leeches at worst, rather than stewards of the public trust. Why would you ever want to go work for an organization like this? It becomes a self-fulfilling prophecy; give it enough time and enough good potential employees who decide not to work in public service and, yes, the incompetent and the leeches are the only ones who will be left…

…which is why you then contract all your work out to “Trusted Private Sector Industry Partners”. This very much smells like a return to the spoils system instead of the merit based appointments that the civil service reforms of 1883 were made to fix. Oops, I just wandered into that chunk of horrible American history I love and history classes like to ignore because those four decades after the Civil War are incredibly complicated and ugly. “Good Enough for Government Work” is a toxic meme that has spread around the world, impairing efforts to reform straight up corrupt bureaucracies, like America’s was before President Chester A. Arthur signed his name to the legislation to obliterate the political system that made him. We really don’t want that back. For the record, I have heard this phrase uttered in every country I’ve ever been to, except Ukraine though that might have been a function of not staying there long enough.

I want “Good Enough For Government Work” to be a statement of pride, with no pejoratives. That you’ve done your job well, that you aren’t phoning it in, and more importantly that we, as citizens, expect it.

 


 

*: My main problem with this excellent story is that I have never been able to lay hands on or even find a picture of the original government schedule or equipment. There would have been reference tools and charts for the quality assurance people to make sure that work was within acceptable tolerances for the gov’t contract, and the separate set for the normal industry ones. As I cast my mind back 20 years to my History of Science and Technology class with Prof. Hugh Torrens, this is exactly what he was talking about regard the practical bits of technology that signal change vanish. Even the most packrat of machinists, and I know a few, must to toss these particular items out of their shops whenever they’re superseded lest they work to an old standard by accident and get torn a new one by auditors**. If you can lay your hands on a side by side comparison of these ~80 year old mundane bits of shop gear, I’d love to see them.

**: Wait, shit, I’m one of those people. Dammit.