Paper or plastic
for your money?
By Julie Sturgeon
We swelled the heads of presidents Lincoln and Jackson. We ran a special thread through our money that glows in the presence of ultraviolet light. By early 2004, we'll fork over colorized $20 bills in restaurants.
And still Americans don't take the prize for the most modern strides in money production.
Australians claim that trophy with their polymer bills that hit streets down under between 1992 and 1996. More than 20 countries followed, including Mexico, China, Indonesia, Singapore, Thailand, Nepal, Brazil and even Kuwait. This plasticized version offers special coatings that feature at least one clear window on the bill, and it's virtually impossible to start a tear.
Plastic vs. paper
Peter Carlin, the senior manager of currency operations for the Reserve Bank of Australia, loves to tick off the advantages when he takes his show on the road to places such as the Interpol 10th International Conference on Counterfeiting:
Polymer money doesn't absorb sweat from palms or disintegrate if you leave it in your jeans pocket when you do the wash. It repels dirt. It doesn't go limp after several hundred foldings. That's why these bills last four to five times longer than the cotton counterparts, he touts. And when they finally die, the recycled granules make excellent plastic garden products such as wheelbarrows and compost bins.
Security prompted the Aussies to explore polymer as far back as 1966.
"At that time, Australia moved to a new series of paper bank notes that included what were then considered to be state-of-the-art security features," he tells audiences. "Within one year, however, high quality counterfeits of the new $10 note had been produced and widely distributed.
"Not surprisingly, the Reserve Bank of Australia's confidence in the existing bank note technology was severely shaken. It took the view that counterfeiting problems could only get worse with further advances in reprographic techniques already on the horizon."
According to Ronald G. Gration, technical manager for Securency Pty Ltd. -- the company in charge of slapping on the security features to the notes -- Australia's Guardian substrate polymer brand produces sharper portrait definitions.
It can incorporate security threads ranging from magnetic to fluorescent, phosphorescent, microprinted, clear text, windowed and machine-readable. It accepts straight and wavy patterns. It holds any color, and you can change colors on the bill's flip side. And those specialty security inks developed for paper money work just as well on polymer.
Our southern hemisphere friends didn't corner the market on counterfeiting. The U.S. Secret Service owes its life to this crime, only adding more familiar duties such as presidential protection a few years after its 1865 inception.
Today, scanners and software programs enabled the unscrupulous to create $47.5 million in fake bills in our country in 2001. Nor does the bleeding stop here. Since 1999, Secret Service agents and the Colombian National Police have seized $133 million from their Bogotá headquarters alone.
It took crooks more than four years to get close enough to a polymer bill to risk floating it out in the Australian public, says Les Coventry, head of Note Issue at the Reserve Bank. The first attempt belongs in the stupid criminal tricks hall of fame: They cut a hole into a piece of paper and taped plastic over the mess. By 1998, Australians reduced their counterfeit bills to fewer than 200 a month, and most of those were knockoffs on the still-circulating paper versions.
The power of polymer
If money is king, polymer is God.
Despite this evidence, the next round of changes rolling off the US. Bureau of Engraving and Printing's presses this fall features the $20 bill with subtle background colors. The $100 and $50 get their makeup within 18 months. Yes, they'll keep some of the current watermarks, security threads and color shifting ink -- plus a few undisclosed counterfeit traps the Bureau remains mum on.
Insiders such as Stane Straus, who owns the industry's polymernotes.org Web site, say they have unconfirmed news that the BEP did test 1 million to 2 million polymer bills in a controlled environment. The BEP won't discuss that either.
"Everything we do is security minded. We're not in the business of changing just to change or to please the aesthetics," says Claudia Dickens, public affairs specialist at the BEP.
As for polymer plans, "That has been looked at, but it was decided not to do it at this time," she reports. "I can't say what we'll do in the future."
The reason she offers: Countries using polymer don't print nearly as many notes as the United States, and polymer costs roughly twice as much to produce as the cotton linen security paper currently in your billfold. Proponents snort at that logic by referring to that extended life-expectancy feature.
Straus offers a more pragmatic political hurdle. "If polymer notes last four or five times longer than paper notes, the paper-banknote manufacturers face a 100 percent loss of revenues. With over 4 billion notes printed each year in the United States, that's a lot of money," he says.
Still, he believes the United States can't hold out against polymer's appeal forever. And since we retool our money every seven to 10 years, that future could be the next big press release.