A Brief History of Coal Scrip

The coal scrip system was a monetary system almost entirely exclusive to the mining company that issued it. Some companies paid their miners in exclusively scrip—not governmental currency—while some only used scrip as a credit to miners to purchase necessities between paydays (Wilson, 2006). This would be deducted from the miner’s paycheck. Some companies allowed miners to trade their scrip for governmental currency, though almost never at full value (typically between 50-85%).

It should be kept in mind that these company stores had no competition due to the use of scrip—their prices were massively gouged. Moreover, miners were kept perpetually in debt by the huge “interest rates” on the scrip. Taking the reciprocal of the rates at which miners could trade in scrip for cash, these interest rates were anywhere from 15 to 50 percent. Miners also owed for their housing, tools, medical services, a mandatory funeral fund, utilities, and whatever else was required of the miner.