January 4, 2005

Why not Plastic Dollar Bills?

According to this Slate article 23 countries currently use plastic instead of paper currency:

Notes circulating in tropical climates wear even more quickly. I lived in India for several years and had more than one rupee bill literally disintegrate in my hands.

This explains why Mexico and 22 other nations have switched from paper to plastic money for at least some denominations. Plastic bills last longer and are more difficult to counterfeit than paper bills. They are less likely to trip up ATMs, and they carry fewer germs. Plastic bills look and feel like "real" money, though they are a bit slicker to the touch.

On a bill for bill basis plastic money costs more but its longer life makes it cost effective. I'd be fine with plastic bills.

Rob, at Say Anything, seconds James Joyner's suggestion that we go all the way by eliminating cash:

It strikes me, though, that a better solution would be to simply switch to the "plastic" currency we have all become accustomed to: credit and debit cards. A purely electronic system would seem to have all of the advantages of polymer bills with none of the disadvantages.
I don't doubt that some year down the road this might happen. For now, though, I say no.

Over a year ago I switched back to cash for all my face to face purchases and am a happier person: transactions happen more quickly (except at the gas stations), the banks don't get a cut of every purchase, and an unknown number of databases to not get another entry linked to my name.

Fix these things and I might change my mind.

Posted by Steve on January 4, 2005
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