This is the new pride of my collection - after I lost this awesome eBay listing, I went out and spent the money I would have spent on that peso on this banknote instead. I figure that anything that I waste more than a hundred dollars on deserves its own forum thread. I have already written about these certificates in "World coins chat - Canada", but I didn't actually own one back then and besides nobody probably read that because it was at the bottom of a huge thread.
So...
The Great Depression
In the 1930s, most of the Western world (especially North America) was struggling in the Great Depression. In the cities, nobody had any jobs - in the country, poor agricultural practices and badly timed natural conditions led to widespread drought. Alberta, my province of Canada (and at the time, a predominantly agricultural one), was hit fairly hard - much of the province's semi-arid south was drying up and destroying the livelihood of those who lived there.
The Solution
The incumbent United Farmers government failed to end the drought, and so the 1936 provincial election was anyone's game. Within six months, a new party appeared out of nowhere - the "Social Credit" party, whose leader William Aberhart (whose signature is on this note) promised to end the Depression by giving free money to everyone in the province through the magic of "Social Credit ideology". Social Credit won a huge majority government and the United Farmers failed to keep a single seat.
The Problem
As a province, not a country, Alberta lacked the constitutional power to actually implement Social Credit policies, such as creating a central provincial bank. Aberhart's radical legislation was consistently declared unconstitutional and illegal by the lieutenant-governor (the Queen's provincial representative), who was backed up by the Supreme Court of Canada. Aberhart got his revenge by kicking the lieutenant-governor out of his official residence (to this day, the house sits vacant, used only for tours and meetings), but unfortunately this couldn't save Social Credit.
The Prosperity Certificate
Before attempting to fully implement Social Credit, the newly elected government tried out a few other radical solutions to the Great Depression as well, just in case one of them worked. One of these was the Alberta Prosperity Certificate. These are based on the "Freiwirtschaft" economic theories of Silvio Gesell and are an example of "demurrage" - deprecating currency.
Basically, inflation is not completely bad (although many coin forums seem to be full of natural hoarders who dispute this). It encourages people to spend their money, which is an essential feature of all economies. But, during the Depression, people began to take their life savings out of the banks and then kept them at home under the mattress, thus making a bad depression worse. How can a government encourage people to spend their money without resorting to extremely illegal behaviour?
The solution was to make undesirable money - thus, the stamp certificate. Basically, these certificates would be treated like dollars. After two years, you could exchange one certificate for one real Canadian dollar - but only if 104 stamps were attached to the back, with each stamp costing 1 cent to buy from the government. Because a new stamp has to be attached every week, you lose one cent for every seven days that you keep your certificate. Therefore, if you kept your certificate until the very end of the program, you would actually lose four cents. It is thus in your best interest to spend these certificates as quickly as possible.
The certificates soon became unpopular. I have met some people who remember their grandparents complaining about the Province's "funny money", and it's difficult to defend the certificates when you examine how people treated them in the real world. At the end of every week, people would rush to the store and buy exactly a dollar's worth of items, leaving shopkeepers with piles of certificates that would need to be stamped at their own expense. In the rural areas of the province, people preferred to be paid in chickens, potatoes, linens, whatever - anything but Prosperity Certificates. What really destroyed the program, though, was the inferior glue used on the stamps. After a few months, they started to fall off at random.
So, if these certificates were not as good as real money, why did anybody accept them? The answer is social pressure - remember that the government that issued these certificates had just won a huge majority and had a high degree of popular support. People were apparently eager to do their part to make Social Credit work. But once word got out that the stamps were falling off the certificates, the program was aborted early. Out of 250,000 certificates issued, all but 19,639 were redeemed and destroyed.
It is also possible to buy sheets of unused 1-cent certificate stamps. Because the program was ended early, any Certificates that actually have 104 stamps attached to them have most likely been unscrupulously modified after the date of withdrawal.
Getting a Certificate
The idea of these certificates was that they would pass through as many different hands as possible, thus benefiting all. Because of this, the vast majority are in terrible condition. Mine is definitely above average, despite hardly making VF. During the Depression, few people could afford to spend a dollar on keeping a crisp new Prosperity Certificate - which was their loss, because fully uncirculated certificates now sell for upwards of $1000! The most interesting Certificate I have ever had the privilege of seeing was accompanied by a little typewritten letter - apparently, it was sent by Premier Aberhart himself out to his family back home in Ontario.
Before buying one of these, I checked as many coin stores in the province as I could - I didn't want to buy one in one city, only to find out that they are much more common in another city. After discovering that the buyers in Calgary are actually queuing up in order to get their hands on a Certificate, I was convinced, and paid $160 for the above example at Northgate Coin and Stamp in Edmonton.
The Prosperity Certificate has a place in history as the only currency issued by a Canadian province in the modern era. It is also one of only two currencies in history (to my knowledge) to use a deprecating stamp-based system (the other was issued for the Austrian town of Wörgl), and thus has great novelty value. The fact that it's from my own province just makes it more exciting.
