Making The Dollar Great Again: The Enduring Challenges Facing The BEP – OpEd

Appointing Scott Bessent as the incoming Secretary of the Treasury, President Donald Trump recently pointed out that this choice was part of his global strategy to, amongst other aims, “[…] fortify our position as the World’s leading Economy, […] Destination for Capital, while always, and without a question, maintaining the US Dollar as the Reserve Currency of the World,” reinforcing the belief that the US dollar remains one of the world’s most powerful and widely recognized currencies, both in its physical and emerging digital forms. This dominance, while increasingly challenged, continues to provide the American government with unparalleled leverage on the global economic stage.

Aligned with the campaign’s direction and the early appointments in the new administration, the dollar—whether physical or digital—must be strategically positioned as a tool of power to advance the MAGA (Make America Great Again) agenda. While the rise of cryptocurrencies presents new opportunities and considerations, the enduring challenges tied to the physical dollar remain consistent. These challenges now warrant even greater political focus, emphasizing the greenback’s role as both a sovereign instrument and a symbol of American strength and authority.

It remains a powerful tool on the international stage, with some independent countries using it as a national currency, while many others happily employ it as an alternative currency of exchange, while others are considering restricting cash dollar transactions, which only underlines the range of the dollar’s influence. As for Americans themselves, they attach a significant importance to their beloved bill as well.

Indeed, with Trump threatening tariff hikes on imported goods from neighboring and adversarial countries, a robust dollar could put the US in a strong position. This was outlined by incoming Treasury Secretary, who stated that “[tariffs] are a useful tool for achieving the president’s foreign policy objectives. Whether it is getting allies to spend more on their own defense, opening foreign markets to U.S. exports, securing cooperation on ending illegal immigration and interdicting fentanyl trafficking, or deterring military aggression, tariffs can play a central role.”

This amplitude of social, political and economic values helps the nation use its currency as a powerful instrument – and presents the dollar printing works, the U.S. Bureau of Engraving and Printing (BEP), and its current chief Patricia “Patty” S. Collins with great responsibility for the symbol of economic power and a certain American dream. Being one of the most high-tech national enterprises, the Bureau translates the above “intangible” responsibility into very concrete physical actions, namely ensuring the highest degree of quality and operational excellence. For this purpose, the BEP entire production system includes not only manufacturing and distribution, but also support processes such as supply chain management, engineering, facilities management and many others. Only when these operations work in concert can the BEP best respond to the needs of its customers: just imagine what a joy opponents would derive from an insufficient dollar supply, or the effects of the increased importance of cryptocurrencies in the American economy. 

But for the BEP, every cog counts – from components like paper or ink, to the meticulous work of a multitude of in-house and external hands aided by high-precision machines to guarantee accuracy and consistently high quality, without production stops or mistypes. For all their differences, they have a point of similarity: their homogeneity, which is critical to ensuring a constant life cycle, yet another challenge that is always achieved, yet never becomes obsolete. Here’s the thing: banknotes, being an integral part of the financial system, circulate within an almost endless environment of highly sensitive ATMs, cash registers, detectors and other things. A batch of lower quality bills caused by a failure at one of the production stages may go unnoticed by an average user, but will raise an alarm at a bank or ATM.

An example is not far to seek. In 2010, the Treasury was forced to delay the debut of the new-series $100 bill due to manufacturing errors. Some notes were creased during printing, making them unusable, and it was found later that the glitch resulted from “a production failure that potentially could have been avoided.” It turned out that the government spent about $120 million to produce bills it couldn’t use, not even considering costs of dealing with the mass of printed but unusable notes. The risk of a similar occurrence is now minimized as the homogeneity of the high-tech equipment optimizes the performance of the man-machine pairing, and ad hoc support and long-standing cooperation between in-house staff and supplier counterparts assist the bureau in performing the task quickly and efficiently. Overall, this system remains highly efficient and expertly deals with the quality issue – but there’s more to the Bureau’s discreet work than just ensuring the bills come out neat and crisp. 

The next challenge concerns constant work on improving the quality and security of banknotes, achieved through ongoing updates and close cooperation. Counterfeiters keep inventing new ways to do their business, while the Fed, the BEP and even the Secret Service work together to find fake items and to prevent them from ever being accepted. The security of banknotes and the possibility of their quick identification play a major role here, and so the Bureau introduces new series and monitors production processes and equipment to ensure that no mistake is made: for instance, BEP Strategic Plan 2022-2026 includes developing “next family of manufacturable banknotes”, which should be “secure, manufacturable, accessible and functions in commerce”. Should this go well, it will add to the BEP’s production base and boost the security of the paper dollar as a store of value – but it’s not so easy to do. The addition of new processes and equipment is a demanding step for the teams to take. And as if this was not enough, the Bureau is currently facing a handover between a retiring generation and new entrants to the profession. The transfer of know-how and the start-up of new operations taken together will require an out-of-ordinary operational performance and cooperation not only from the Bureau, but from all upstream and downstream supply chain stakeholders.

Speaking about the latter – in contrast to other industries, security printing suppliers aren’t just sellers of things. Managing the production of a highly secure and constantly improving product is no mean feat, and suppliers need to keep up to date: the resistance of security features to counterfeiting is regularly eroded by technological advances that enable them to be imitated or approximated. Consequently, currency printing equipment has over time evolved from simple printing presses to high-tech machines fully integrated into the production process. Others can afford a like-for-like equipment change, but this wouldn’t work in security printing: the designs and security features are developed in strict secrecy, patented, and are primarily designed to ensure expert quality, technological continuity and smoothness of operations while a facility has to be modernized regularly. The practical sense of such a feature reveals itself especially clear in solving unusually complex tasks, such as the one the Bureau is facing right now. The printer is set to replace its facility in D.C. with a new one located in Maryland. Once the new site opens its doors, there will be a transitional period of a working overlap, that might potentially create difficulties in ensuring operational continuity and production quality at the end of the process in three different locations (the third being located in Texas) – if not for the similarity of the production processes at the two sites.

The administration’s plans take into account the entirety of challenges ahead of the BEP, but it may change overnight, and it is clear that the printer must be well prepared for new waves of demand. The Bureau has already shown its flexibility in ebbs and flows of the COVID-19 pandemic, but its capacity to respond to future challenges will depend on its ability to cope with the potential entropy generated by such a range of existing challenges.

It is now possible to assume that the routine and out-of-ordinary tasks will be successfully accomplished with the well-established production system. In an interview not long after her nomination back in April, Patty Collins noted that the printer copes with change using several factors, including subordination to the Treasury department, close and long-term relationships with material and equipment suppliers, and successful human capital/talent management. While her background inspires confidence—particularly her proven ability to optimize and maintain operational processes in both routine and crisis situations—the future may bring challenges. The Bureau and its recently appointed Director will have to deliver on the plan, while potentially being flexible to shifts in leadership or priorities decided by the incoming head of the Treasury, Scott Bessent. While the overall outlook for the Bureau and the paper dollar remains cautiously optimistic, it is tempered by decisions yet to be made.