Gibbons had plenty of time to be ready before the murmurings about his monopoly of the banking business came to a head. The New Beginnings Bank of Commerce was a bank of issue; he (or Zaccur) always set up such a bank in each colony they pioneered. Money was necessary to a growing colony; barter was too clumsy. Some medium of exchange was needed even before government was needed.
He was not surprised when he was invited to meet with the town's selectmen to discuss the matter; it always happened. That evening, as he trimmed his Vandyke and added, a touch more gray to it and to the hair on his head in preparation for the confrontation, he reviewed in his mind proposals he had heard in the past for making water run uphill, the sun to stand still, and one egg to be counted as two. Would there be some novel numbskullery tonight? He hoped so but did not expect it.
He plucked hairs from his "receding" hairline-damn it, it was getting harder and harder to age enough each year!-then put on his war-plaid kilt...not only more impressive but with more ways to conceal weapons-and get at them quickly. He was fairly sure that no one was, as yet, annoyed enough at him to start violence, but once he had been too optimistic; since that time he had been a pessimist as a fixed policy.
He hid some items, locked up others, set some gadgets that Zaccur had fetched last trip but which were not offered for sale at the Top Dollar T.P., unlocked his-door, hand locked it from outside, and left by the route through the bar, so that he could tell the barkeep that would be away "a few minutes."
Three hours later Gibbons had settled one point: No one had been able 'to think of any new way to debase currency that he had not heard at least five hundred years earlier-more likely a thousand-and each was certainly much, much older in history. Early in the meeting he asked the Moderator to have the Town Scribe write down each question so that he could answer them in a lump-and was allowed to have it his way by being balky.
At last the Moderator Selectman, Jim "Duke" Warwick, said, "That seems to be it. Ernie, we have a motion to nationalize-I guess that's the word-the New Beginnings Bank of Commerce. You're not a selectman, but we all agree that you are a' party with a special interest, we want to hear from you. Do you want to speak against the proposal?'
"Not at all, Jim. Go right ahead."
"Eh? I'm afraid I didn't understand you."
"I have no objection to the bank being nationalized, if that's all, let's adjourn and go to bed."
Someone in the audience called out, "Hey, I want my question about New Pittsburgh money' answered!"
"And mine about interest! Interest is wrong-it says so in the Bible!"
'Well, Ernie? You said earlier that you would answer questions."
"So I did. But if you are nationalizing the bank, wouldn't it make more sense to put questions, to your state treasurer, or whatever you decide to call him? The new head of the bank. By the way, who is he? Hadn't he better sit up here on the platform?"
Warwick pounded his gavel, then said, "We haven't got that far, Ernie. For the time being the entire Council of Selectmen is the finance committee-if we go ahead with this."
"Oh, by all means go ahead. I'm shutting down."
"What do you mean?"
"Just what I said: I quit. A man doesn't like to have his neighbors dislike him. The people of Top Dollar don't like what I've been doing or this meeting would never have been called. So I've quit. The bank is closed it will not reopen tomorrow. Nor ever with me as president of it. That's why I asked who your state treasurer will be. I'm as interested as anyone in finding out what we are going to use for money from here on-and what it will be worth."
There was dead silence; then the Moderator had to pound his gavel and the Sergeant at Arms was very busy, all to shouts ,of "What about my seed loan?" "You owe me money!" "I sold Hank Brofsky a mule on his personal note-what do I collect?" "You can't do this to us!"
Gibbons sat quietly, not letting his alertness show, until Warwick got them quieted down. Then Warwick said, wiping sweat from his-brow: "Ernie, I think you've got some explaining to do."
"Certainly, Mr. Moderator. The liquidation will be as orderly as you will let it be. Those who have: deposits will be paid...in banknotes, that being what was deposited. Those who owe money to the bank-well, I don't know; it depends on the policies the council sets up. I suppose I'm bankrupt. I can't know until you tell me what you mean when-you say my bank is being 'nationalized.'
"But I have bad to take this step: Top Dollar Trading Post is no longer buying with banknotes-they may be worthless. Each deal will have to be barter. But we will continue to sell for banknotes. But I took down the posted prices just before I came here tonight...because the stock I have on hand may be all I ever have with which to redeem those banknotes. Which could force me to raise prices. It all depends on whether 'nationalize' is simply another word for 'confiscate.'"
Gibbons spent several days explaining to Warwick the elementary principles of banking and currency, patiently and with good humor-to Warwick by Hobson's choice because, the other selectmen found that they were too busy with their farms or businesses to take on the chore. There had been one candidate for the job of national banker or state treasurer (no agreement as yet on title) from outside the selectmen, a farmer named Learner, but his self-nomination got nowhere despite his claim of generations of experience in banking plus a graduate degree in such matters.
Warwick got his first shock while he was taking inventory, with Gibbons, of the contents of the safe (almost the only safe on New Beginnings and the only one of Earth manufacture); "Ernie, where's the money?"
"What money, Duke?"
"What money?' Why, these account books show that you've taken in thousands and thousands of dollars. Your own trading post shows a balance of nearly a million. And I know you've been collecting mortgage payments on three or four dozen farms-and haven't loaned hardly anything for a year or more. That's been one of the major complaints, Ernie, why the selectmen just had to act-all that money going into the bank and none coming out. Money scarce everywhere. So where's the money, man?"
"I burned it," Gibbons answered cheerfully.
"Certainly. It was piling up and getting too bulky. I didn't dare keep it outside the safe even though we don't have much theft here-if somebody stole it, it could ruin me. So far the past three years, as money came into the bank, I've been burning it. To keep it safe."
"What's the trouble, Duke. It's just wastepaper."
"'Wastepaper'? It's money."
"What is 'money,' Duke? Got any on you? Say a ten-dollar bill?" Warwick, still looking shocked, dug out one. "Read it, Duke," Gibbons urged. "Never mind the fancy engraving and the pretty paper that can't be made here as yet-read what it says."
"It says it's ten dollars."
"So, it does. But the important part is where it says that this bank will accept that note at face, value in payment of debts to the bank." Gibbons took out of his sporran a thousand dollar banknote, set fire to it while Warwick watched in horrified fascination. Gibbons rubbed the char off his fingers. "Wastepaper, Duke, as long as it's in my possession. But if I let it get into circulation, it becomes my IOU that I must honor. Half a moment while I record that serial number; I keep track of what I burn so that I know how much is still in circulation. Quite a lot, but I can tell you to the dollar. Are you going to honor my IOU's? And what about debts owed to the bank? Who gets paid? You? Or me?"
Warwick looked baffled. "Ernie, I just don't know. Hell, man, I'm a mechanic by trade. But you heard what they said at the meeting."
"Yeah, I heard. People always expect a government to work miracles-even people who are fairly bright other ways. Let's lock up this junk and go over to the Waldorf and have a beer and discuss it."
"-or should be, Duke, simply a public bookkeeping service and credit system in which the medium of exchange is stable. Anything more and you are jiggering with other people's wealth, robbing Peter to pay Paul.
"Duke, I did my best to keep the dollar stable by keeping key prices stable-seed wheat in particular. For over twenty years the Top Dollar Trading Post has paid the same price for prime seed wheat, then resold it at the same markup- even if I took a loss and sometimes I did. Seed wheat isn't too good a money standard; it's perishable. But we don't have gold or uranium as yet, and it has to be something.
"Now look, Duke-when you reopen as a treasury, or a government central bank, or whatever you call it, you're certain to have pressures on you to do all sorts of things. Lower the interest rates. Expand the money supply. Guarantee high prices to the farmer for what he sells, guarantee low prices for what he buys. Brother, you're going to be called worse names than they call me, no matter what you, do."
"Ernie-there's only one thing for it. You know how...so you've got to take the job of community treasurer."
Gibbons laughed heartily. "No, sirree, bub, I've had that headache for more than twenty years; now it's your turn. You grabbed the sack, now you hold it. If I let you put me back in as banker, all that will happen is that they will lynch both of us."