May 22

Frankenstein’s Lab: Hard-time currencies

Economics abhors a vacuum. As exemplified by the Prohibition-era US of the 1920s, the forbidding of goods creates a sellers’ market – and most goods are prohibited in prison. According to a 2014 report by the US National Research Council, the country accounts for a quarter of the world’s prisoners. Unsurprisingly, a large proportion of the anecdotal evidence collected by sociological studies originates from the US prison population. And you may be surprised to hear what these studies have revealed about what prisoners substitute for cash.

Tobacco was banned in US federal prisons 10 years ago, which caused upheaval to the bartering economy based on cigarettes – the default substitute for currency. As tobacco is now considered contraband, cigarettes have surged in value, but cannot legitimately be possessed. Of course cigarettes still find their way into prisons, by similar methods used to smuggle in drugs – bear in mind that tobacco is much easier to obtain wholesale in the outside world. Although there are plenty of channels for illicit goods, stockpiling and trading in permitted items, while still carrying a risk of discipline or removal of privileges by the authorities, comes with less severe penalties.

The principal source of licit goods in US prisons is the commissary (equivalent to Billy Bunter’s tuck shop – but let’s not dwell on how Master Bunter would fare in the state penitentiary). Prisoners can buy approved items by using limited cash accounts, but cannot use the cash anywhere else. Given the captive nature of the market, the everyday items on sale already come at a marked-up price, and have their value pushed up further by the authorities’ imposition of limits on possession – books of stamps are often limited to three per inmate, for example.

Postage stamps are, in fact, a widely traded commodity. They are easy to hide and therefore easy to hoard. You could argue that stamps are less valuable these days, but remember that email and smartphone access are restricted in federal prisons – old-fashioned letter-and-stamp correspondence being less of a headache for the authorities to monitor.

Packets of preserved mackerel are also highly prized. While this may seem improbable, the packets are durable, they don’t go off, and they are much simpler to hide than cans, which are in any case less freely available as they can be weaponised. And, crucially, packets of mackerel cost roughly one dollar – which makes transacting easier (more of a stickleback than a greenback, then). But why would anybody trade with packets of food that they don’t want to eat? In fact, their very inedibility makes them useful, as weightlifting alpha males are the group most interested in actually consuming them as a protein-rich food source. And from alpha males to Omega-3 men, this oily-fish currency has been gaining in strength since the tobacco ban. Ultimately, the mackerel packs serve as an agreed representation of worth, just like coins and banknotes, which are of negligible value as physical objects without the monetary system to support them.

Other foods and drinks are also traded, including less perishable foodstuffs like ramen noodles, powerbars, and instant coffee. But not everything that acts as currency needs to be bought at the commissary, as evidenced by the demand for clean urine, which is sought after in order to pass drug tests.

The value of these prison currencies or commodities is inevitably time-specific, depending on the length of sentence. In the outside world, they are of only face value. But while there isn’t a huge market for packets of fish or unadulterated urine futures on global exchanges, the principles involved when trading in prisons link the two worlds more closely than you might think.

Duncan Black, 22 May 2014