Rationing
currency as a tradable asset. Illegal trade in coupons in The
Ralf Futselaar, Netherlands
Institute for War Documentation
Supervisor: Prof. Dr. J.C.H.
Blom
Few wars have had as great an economic impact
as the Second World War. The effects of the loss of human life, as well as the
impact on raw materials and production capacity, are well known, but do not tell
the whole story. The war also brought about a change in the role governments had
in economic matters, which was to have a lasting effect in the decades
thereafter.[2]
During the war, virtually all modern economies were subjected to rigorous
central planning. This included not only far-reaching government interference
with production and stock formation, but also the introduction of price controls
and nearly comprehensive rationing. The
The rationing scheme that was introduced in The
Netherlands during this era differed fundamentally from previous attempts too
protect the standard of living through government intervention. Unlike poor
relief or state pensions, rationing was not aimed at a particular group: all
citizens received the same ration, irrespective of their ability to care for
themselves. Another remarkable feature was that goods were not rationed as such,
but rather the right to purchase them. All (heads of) households were given
rationing currency, usually paper coupons, representing the right to buy a
certain amount of a certain good. Thus, it was hoped, equal living standards
could be created for the duration of the war, but without destroying wholesalers
and retailers who remained the main channels through which goods reached
consumers.
It was illegal to give away, sell or swap
rationing currency. Rationing currency was meant to be economically neutral, a
visible hand of allocation, but not an asset in itself. The success of the
system depended, of course, on either willingness of people to comply with the
pattern of consumption mapped out for them, or the possibilities of forcing them
to. Rampant black marketeering in goods such as eggs and cigarettes proved that
compliance with regulation was far from perfect. But very little was known about
(or done against) trade in rationing currency. Law enforcers, struggling against
black marketeering in goods, appear not to have been particularly motivated, or
able, to combat the black market for rationing currency. Likewise, this somewhat
peculiar type of illegal economic activity is almost completely absent in
relevant historiography. [4]
Nevertheless, trade in rationing currency did play an important role in the
illegal economy in The Netherlands.
I
Many coupons changed hands in The Netherlands
in a neighbourly context. By exchanging coupons with relatives, friends and
neighbours, households (usually housewives) could adapt their ration somewhat to
their needs, tastes and income. Though illegal, little or nothing was done
against this type of exchange, not least because it was (and remains) nearly
impossible to detect. Only when the Dutch Society of Housewives organised a fair
to accommodate swapping on a larger scale, did the authorities
intervene.
Apart from such minor exchanges between
households, some people reportedly sold coupons to professional black
marketeers. Poor households in particular, sold coupons for goods they
considered too expensive to purchase, such as meat or butter. The number of poor
households was on the decline, as unemployment was quickly disappearing in the
course of 1941 and 1942, not least because of rising employment (both voluntary
and coerced) in the German war industry. [5]
Nevertheless, there remained a sizeable number of people on low incomes, who
were apparently unable or unwilling to purchase their entire ration. Especially
in 1942 and 1943, officials of the National Food Board regularly complained
about the presence of professional coupon merchants, who were buying up
rationing currency from poor families.[6]
These exchanges of coupons were mostly local
affairs. But trade in rationing currency also took place over longer distances,
substituting for illegal trade in goods. There were opportunities for such trade
between rural areas, where agricultural products could easily be diverted from
registered production, and urban centres where this was not possible. Many of
these goods were bulky and hard to transport , while the risk of detection was
considerable, so that transportation costs were high. To avoid the cost and
risks of transport, black marketeers sold these goods (very) cheaply to the
local, rural population and took in their coupons. These could easily be
smuggled into the cities where they were sold to people who used them to
purchase products in ordinary stores, where prices had been fixed at a low
level. The difficulty of smuggling products, made it attractive for black
marketeers to trade in rationing currency, or rights of purchase.
II
Local trade in rationing currency, as described
above, was difficult to detect. Trade in rationing currency over longer
distances, on the other hand, could hardly escape notice. The larger the number
of coupons from one area that was smuggled into another, the larger also was the
discrepancy between the number of coupons issued, and the number returned.
Employees of the Central Rationing Office, who administered the deliverance of
goods to various regions (in accordance with the number of coupons returned in
each of them), as well as the issuing of coupons (in accordance with the
population), were perfectly aware of the migration, as they called it, of
coupons.[7]
Even though an awareness of coupon migration
existed, very little was said and written about it. Only once, in November 1942
was a countermeasure taken. The rationing office introduced two kinds of
potato-coupons, one for rural and one for urban areas. Because rural coupons
were not valid in the cities, trade in these coupons was expected to halt.
However, since even the three big Dutch cities were fairly small, illegally
obtained coupons could still be used in rural areas close to urban districts.
From late 1942 onwards, (semi-) rural areas directly adjacent to cities saw
potato sales rise explosively, as urbanites bought their potatoes there, with
illegally bought coupons. This failed measure is of importance here, not because
of its failure, but because the evaluation of the policy required the collection
of data on coupon returns. As all other records have been destroyed, the data
gathered for this purpose form the only reliable quantitative source for the
investigation of coupon trade.[8]
The difference between the numbers of coupons
issued and returned, can be expressed as a percentage. Without migration of
coupons, the percentage in every area should have been 100 per cent or less,
save for some minor variation due to legal purchases outside people’s place of
residence, such as cigarettes bought by commuters. However, many of the found
discrepancies are far too great to be attributed to the mobility of their
owners, especially with goods such as potatoes that are usually not bought far
from home. Coupons were being separated from their legal owners, either through
trade or through charity. With regard to the latter, some of the migration of
coupons may have been caused by the, likewise illegal, generosity of some rural
households towards urban friends and relatives. There is evidence of such
charity, though by no means in abundance.[9]
In total approximately 10 per cent of the total
number of potato coupons were returned in regions neither in, nor near, where
they had been issued. The strongly positive regions are all adjacent to one or
more of the three big cities. Moreover, the regions with low return percentages
are clustered in the Northeast and Southeast, where potatoes were grown. The
opportunity to divert potatoes from the controlled economy, appears to have been
related to the relative number of potato-growers in each area: there is a fairly
strong negative correlation between the percentage of the population involved in
the production of potatoes (who did not receive coupons) and the return
percentage.[10]
Potato coupons were smuggled far more than
other coupons. Return percentages for candy, for example, reveal only two
remarkable cases. In two wealthy residence areas, Het Gooi and De Hollandse Vechtstreek, return
percentages for candy were 179 per cent and 195 per cent. Tobacco coupon returns
were relatively low along the Belgian border, where tobacco was smuggled into
the country.[11]
But the extent of coupon migration was nowhere near that of potato coupons.
Potatoes, being very bulky and heavy relative to their nutritious value and
price, which were produced relatively far away from the main urban area in the
west, were obviously well suited to be replaced by coupon
trade.
The question remains who were buying these
potato coupons. Hunger is the most obvious explanation, but until collapse of
the infrastructure in late 1944, the ration was easily sufficient to live on,
even though it contained less fat, bacon and cheese than the diet most people
consumed before the occupation.[12]
Potatoes, on the other hand, were relatively plentiful. The 500 grams of
potatoes per head, per day (late 1942), would strike modern observers as too
high, rather than too low, and was quite in accordance with contemporary
standards. There should have been little need, hence, to resort to a black
market for potato
Map 1. Return percentages for potato
coupons in the The Netherlands,
December 1942
Calculations and map based on NA, Archive CDK,
232. Return percentages of potato-coupons, per economic-geographical region,
November 1942. Three major cities,
coupons. Moreover, potato coupons do not appear
to have dominated the black market for coupons in the western cities themselves.
Reports on black markets regularly mention
trade in coupons, but among the instances where specific coupons were
mentioned, those for potatoes make up only 5 per cent, as can be seen in Table
1. This information is is
based on 199 cases of coupon trade on black markets in the three big
cities. The urban black market for
rationing currency was dominated by coupons for sugar and dairy, which were
relatively scarce in the ration. What then, prompted a relatively large influx
of potato coupons in the western cities?
|
Table 1. Frequencies of various
coupons on black markets in The Hague, Rotterdam and Amsterdam | |
|
Product |
Per
cent |
|
Sugar |
13 |
|
Butter |
12 |
|
Milk |
10 |
|
Meat |
9 |
|
Bread |
9 |
|
Jam |
7 |
|
Tobacco |
6 |
|
Potatoes |
5 |
|
Other
(beans, soap, fuel, textiles) |
32 |
|
Source:
data collected by undercover agents of the Bureau for Price Control
and the National Bureau for Nutrition, between June 1942 and June 1943:
NA, Archief prijsbeheersing, inv. No. 62; RBVVO, inv. No. 48-52. | |
The explanation for these apparent paradoxes
lies in the division of income, rather than in the composition or size of
rations. The rationed package was sufficient to live on, and well endowed with
potatoes, but again, goods rather than rights were rationed. As explained above,
universal wealth had not been achieved with the disappearance of unemployment.
Poor households were given coupons that gave them access to a ‘middle class’
pattern of consumption, which (they found) was ill suited to their budget. Even
if they could afford to buy the diet available to them, many may have found it
more attractive to save some money for the purchase of tobacco, shoes, or
clothing on the black market. The right to buy luxurious goods, had become an
asset in itself, one that numerous people sold rather than used. The prices paid
for these coupons, by the wealthier people, were often high and hence a
considerable contribution to the income of the urban poor. To supplement their
diet, they increased their potato consumption, relying on the relatively cheap
potato coupons.
III
The rationing system in the occupied
Netherlands had the ambitious goal of sharing the available food, and many other
goods, evenly among the population, in order to avert the hoarding and inflation
which would otherwise have threatened the livelihood of the poor (and otherwise
vulnerable) citizens. The autonomy people previously had to adapt their pattern
of consumption to their needs, as well as their budgetary restraints, was
officially abandoned. Because needs, but especially incomes, remained widely
divergent, people sought to regain that autonomy. The influx of potato coupons
into the cities was a mere link in the chain in which potatoes were consumed
illegally in the areas where they were grown, the urban poor expanded their
potato consumption by buying rural coupons, and the wealthier people in the city
bought coupons for butter, meat, etc., from the urban
poor.
The question remains why trade in rationing
currency received so little attention at the time. Two explanations are at hand.
Policymakers may have been aware that through coupon trade, people in the lower
income bracket were able to expand their income and protect their standard of
living. However, no indication has been found that the authorities seriously
discussed the issue. Another possibility is that the Dutch authorities were
anxious to hide the phenomenon of long-distance coupon trade from the German
occupiers.
The scarcity of sources makes it impossible to
reconstruct how the black market for rationing currency developed through time,
especially if it was indeed consciously under-reported. Obviously, it must have
taken some time for this trade to develop into a functional system of nationwide
criminal relations. Likewise, it is clear
that with the collapse of the rationing system in late 1944, trade in
rationing currency disappeared. To gain more insight in the operation of this
type of illegal trade, the comparison with other countries, many of which had
similar rationing systems, may offer an opportunity.
References
Henau, A. and van den Wijngaert, M., België op de bon: rantsoenering en
voedselvoorziening onder Duitse bezetting 1940-1944 (Leuven,
1986).
Jensen, S., Levevilkår under besættelsen (Copenhagen, 1971).
Klausen, J., War and Welfare:
Klemann, H.A.M., Nederland 1938-1948. Economie en samenleving
in jaren van oorlog en bezetting (Amsterdam 2002).
Trienekens, G.M.T., Tussen ons volk en de honger: De
voedselvoorziening 1940-1945 (Utrecht, 1985)