Local money

This 25 cent bill was issued by the municipal government of Granollers (Barcelona) in 1937. On the front, against the silhouette of a factory in the background, a worker and a peasant hold hands behind a horn of plenty and the coat of arms of Cataluña. On the reverse, the word “Emancipation” stands out against a worker and some smoking factory chimneys. This bill was only one of more than 7,000 issued by some 2,000 local, provincial and regional governments across Republican Spain between the outbreak of the Civil War and the end of 1937. In a mundane but powerful way it reminded citizens on a daily basis of the fracturing of the Republican state provoked by the military uprising and the difficulties it faced in restoring even this most basic of government functions.

As the failed coup turned into a long war, the government withdrew all silver coins in order to create a strategic silver reserve but did nothing to replace smaller denomination 10, 25 and 50 cent coins that were crucial for ordinary people in their daily lives. If someone wanted to purchase a kilo of bread for 70 cents or have a coffee in a bar for 20, there was no way to get change.

Responses to this situation came from below. First there was bartering. Then shopkeepers began to issue coupons, but these were valid only at a single store and caused protests. The next stage was for all stores in a town or village to issue paper money that could be spent at any of them.  The most important response came when municipal and, to a lesser extent, provincial governments began to issue paper money which served as legal tender within their jurisdiction. Some military units, political parties and unions also issued their own. Most were issued during 1937.

This phenomenon was most widespread in Cataluña, which accounted for about half of the bills issued. The Generalitat began the process with a decree on 21 September 1936 establishing its own currency, part of a larger policy of taking over the functions of the central state. When the Generalitat authorized local governments to issue small denomination bills, 773 of the 1.075 municipalities did so.  Some replaced céntimos and pesetas with new units, such as unidades and grados. More than one hundred changed their names, dropping the word “Saint”. The physical objects came in a wide range of sizes, shapes – including round and rhomboid - and designs, and were made using paper, leather, cardboard, parchment, and even plastic. Existing items were recycled. In Besora, the parish priest’s calling cards were torn in half and then stamped with the municipal seal.

The Republican government began to reassert its control over the currency in December 1937, but when it tried to restore the monopoly it had lost, it had to use postage stamps and cardboard disks bearing the coat of arms to replace the local money because the mint was unable to produce the necessary coins. The war ended with this makeshift system of bills and coins in place, the Republic never having been able to re-establish a monetary normality.