When Tenino, Washington's bank failed in the 1930s, the town printed wooden dollars on an old newspaper press. In 2020, facing pandemic hardship, the mayor revived the program, distributing $10,000 in wooden bills to low-income residents. The currency only works at local businesses, keeping money in the community.
So 90 years later, they're once again printing their own wooden dollars to pass out to members of the community.
Everyone, this is Zach. I'm here with Michael Waters. He's our newest writer at The Hustle. And Michael, this week you wrote a really interesting Sunday story about this small town in Washington that created its own currency. Tell me a little bit about this place and why they started doing this.
Yeah, so the town is called Tenino, Washington. It's out in the woods. It was known as like this big lumber hub in the early 1900s, and one of its claims to fame in the world and especially in the U.S. is the fact that during the Great Depression it had started its own currency, and they printed these sort of like fake dollar bills that were on like thin wooden blocks and they pass it out to members of the community in the early 1930s after one of their only town banks closed down. And so people were out of money, people were desperate, and so they basically started up their own currency back in the 1930s. And it was a huge hit to the point where people still collect these like wooden Tenino dollars that are not like legal currency in the federal sense. And now that, I mean, we're facing another unprecedented economic catastrophe, this town, they know their history very well, and the mayor of this town is basically trying to bring back that program for 2020. So 90 years later, they're once again printing their own wooden dollars to pass out to members of the community.
And they're even using like the same— they're using like a 130-year-old printer as their mint, right?
Yeah, yeah, yeah. In the 1930s, it was originally printed on this like newspaper printer from 1890. So even then it was kind of old, and they're using the same exact mint right now to print the currency basically. And one reason for that is just the like historical value, and the other reason is like even the best forger is probably not going to do a great job of forging something printed like on an 1890 newspaper printer. So it's a little foolproof.
So they're starting with a first printing of around $10,000. What's kind of their general plan for distributing this? What's their vision and who is it going to help exactly?
Yeah, so this money again is going to be distributed not using like US federal dollars, but using this like own local wooden currency. So the idea behind that, first of all, is that because this currency only is really like accepted in Tenaino, you can't go off spending that money anywhere. Like Amazon is not gonna take your wooden dollars from Tenaino. So it's a way to keep the money local. And they are targeting, especially with this initial $10,000 printing, they're targeting low-income residents who've been affected by the pandemic. So to qualify, you have to prove that you're below the poverty line and that you've been affected in some way by these last few months, and they're pretty open to how that latter part of whether you've been affected is defined. And so if you qualify, you get a stipend from within the $10,000. And I should also clarify here that this is a town of like 1,800 people. So $10,000 does go a long way, and if it's only targeting a certain population within this community. So although it might not seem much on the scale of a larger city, it does mean a lot in a town like this. And yeah, and basically every business in town is locally run, and so almost every business has signed up to accept this money. And so people who are given out the wooden dollars can spend anywhere in town, and like I said, because it's not official US dollars, it's a way to ensure that the money stays local and is boosting local businesses who have also been impacted by the pandemic. Sure, sure.
So it's got this kind of twofold effect of helping these businesses that have kind of been beleaguered by the pandemic, but also helping provide some kind of recourse for low-income residents.
Right, exactly.
And you also touched on a number of other— you found tons of examples of other towns doing this internationally, which I thought were really interesting. What is the— is this something that might be used effectively in other towns? I know there's been a little bit of research done on the effectiveness of local currencies. Can you touch on that a little bit?
Yeah, the research as it stands is a little bit complicated. It is really hard to find exact cause and effects with something like this, because there are so many factors at play. It's hard to measure exactly to what extent local currencies like this help economic recoveries, which is especially what they were designed for. But the evidence from research seems to be cautiously positive, I'd probably summarize it, which is to say that there are, in about like half of the cases, there are signs that local currencies have some sort of positive impact on local businesses and on getting people spending. And then another half of cases, according to this one study, are kind of inconclusive. And it's certainly something that has worked in different places more than others around the world. There are plenty of stories, especially from the Great Depression, of local currencies like dramatically cutting jobless rates in a certain region while like in the larger country, for instance, jobless rates might go up. And so, I mean, again, it's hard to tease out exact links sometimes, but there's plenty of evidence. The evidence is, like I said, cautiously positive, I would say. Sure. Sure.
Well, this is a really interesting story. And if you guys want to read it, be sure to check out our email on Sunday. Thanks a lot, Michael. Appreciate your time.
Yeah, thank you.
