The greenback could be in for a color change under plans being considered in Congress and other government circles.
Legislation now before the Senate would order the Treasury Department to study the possibility of changing the color or size of U.S. currency to thwart drug dealers and money launderers who are draining the nation of billions of dollars annually.Donald Regan, who was treasury secretary and White House chief of staff during much of the Reagan administration, is a strong backer of the concept, and the Drug Enforcement Administration is actively pursuing such a plan.
"I believe it would be devastating to the drug traffickers," said Sen. Alfonse D'Amato, R-N.Y., who introduced the money measure in the Senate. "You can't just do business as usual. They've been beating the system."
D'Amato's measure is part of broader legislation cracking down on money laundering that was approved in July by the Banking Committee and headed for action by the Senate. The study would focus on the possibility of altering selected denominations of U.S. currency or only U.S. currency in circulation in foreign countries.
"You've got to use every weapon you can to stop drug traffickers," Regan said in an interview. "To me, the reason that most people go into selling drugs and dealing in drugs is the profit motive. Anything that you can do to interrupt that profit chain has to interrupt the drug chain."
Regan estimated that the U.S. "underground economy" of drug money, organized crime profits and other "off-the-books" income is about $300 billion annually, meaning the government is being deprived of about $100 billion in taxes per year.
The change would be unprecedented. Paper money has been green throughout U.S. history, according to the Bureau of Printing and Engraving. The last major design change came in 1927 with a size reduction and standardization of artwork.
The logic behind the proposal is simple: Virtually all sales of narcotics are conducted in cash, even wholesale transactions that involve millions of dollars.
Due to restrictive currency control laws in the United States, major drug trafficking organizations must export their illegally gained money, often by smuggling, to be deposited - "washed" or "laundered" - in a bank in a country with weak or non-existent currency controls.
The DEA has proposed that the government print two forms of currency, one as legal tender exclusively inside the United States and one as legal tender exclusively outside the United States, said David Wilson, who heads DEA's anti-money laundering efforts. The two forms would be interchangeable only at a U.S.-controlled financial institution, meaning drug traffickers could no longer exploit weak currency control laws in foreign banks and smuggled money would be worthless.