Mira Luna asks if there is a perfect alternative currency to replace the present dysfunctional monetary system.
The experts she interviewed give her ideas on where present trends may be, or should be, headed.
“Recently, I surveyed some of the top currency experts in the world about where the currency movement is headed and which are the most promising models.
* Thomas Greco is encouraging small business to business mutual credit clearing as a foundation for any viable currency alternative wishing to gain significant ground in the local economy. Paper currencies and other systems can be added on later, but the bulk of our currency based trading remains business to business and business to consumer and not between individuals. And a system that desires business involvement might be wise to design a system that is easy and beneficial for small businesses to use before anything else. Also, if we can provide support to local businesses with low or no cost mutual credit and increase trading boosted by alternative currencies, we might save many local jobs, which provide real paychecks that can pay for real needs.
There are a number of platforms being developed for business to business mutual credit clearing with progressive aims, like GETS from Richard Logie in Scotland. However, like many of the other systems and like Timebanks USA, these software platforms come with an ongoing cost to provide the entrepreneurs who designed them with a substantial living. Thomas Greco’s suggestion- buy the best one out and make it open source. Not a bad idea. I’d hate to promote an alternative currency platform that you have to spend lots of national currency notes to maintain, especially when you are trying to support struggling small businesses and poor individuals that cannot afford that cost to passed on to them. That makes no sense.
* Stephen DeMeulenaere of the Complementary Currency Database pointed towards STRO’s work in Latin American, which Miguel Hirota of Complementary Currency Labs of Japan has also noted many times. It is difficult to find information on the mechanics of these programs. However, the Banco Palmas project in Brazil is an interesting success model. In a poor area of Brazil, locals are given currency by card or paper as credit to start businesses or to purchase goods either on credit alone or for work. This dramatically stimulates the local economy in an area where many people have no ability to earn national currency on a reliable basis to meet basic needs. The system works and people pay back their small loans simply because people know each other and it is tight-knit community. However, STRO has chosen to limit their assistance in designing currencies models to developing countries, primarily in Latin America.
Both official Timebanks USA and other online time exchanges are taking off. Timebanks USA claims 70+ new timebank start-ups this year in 28 states, and 188 set-up kits were sent off. These projects are simple to start and relatively low risk. However, they have a difficult time capturing a significant portion of the economy. This may change as federal currency because more scarce and people need to save their few dollars for necessities that can only be paid in federal currency like medicine, rent and insurance. When you use timebanks, you spend and earn hours for things that don’t necessarily require federal currency to flow. Though they have failed so far to capture a large portion of the local economy, their viral spread throughout the world without any concerted effort and significantly large world-wide numbers of individual participants is a testament to the desire to organize at least the informal economy in this way and to reconnect alienated communities, especially in the West.
LETS and some other kinds of time exchange and barter, like RICH Hours and Swapcove also don’t require federal currency, but encourage trading of some things that you might otherwise have to pay federal currency for because their unit of account is linked to the dollar. RICH Hours, Dibspace, LETS and local discount programs (like on Village Networks website and the Go Local Sonoma card) are linked to the US dollar so they are easier for businesses to adapt to and feel confidence in. It appears the more like the current system, the easier the business buy in. This is also proven by the success of the Berkshares and Cheimgauer models, which are both linked to and backed by national currencies.
In the long run for sustainability, stability and local control, it would be best to these currencies to have a different backing or at least linking to a different unit of account. Though I see little harm in starting with a system that is very much like the current currency system with the explicit of intention of a collectively guided transition to a significantly different model over time, just to get things started and get business buy in. It is my understanding that Berkshares does have the intention of moving towards a more transformative system eventually and they are being strategic in starting out conservative.
All of these systems have their advantages and disadvantages and work best at solving certain problems more than others. So which is a community to choose? Well it depends on your goals and which sector of the economy you want to work on. If businesses in your community are doing fine, but your community is completely alienated and miserable in their 9-5 corporate jobs or people are struggling to make ends meet with low paying jobs, you may want to start a time exchange. If businesses are dropping like flies or unemployment is sky high, you may want to start a business to business mutual credit system, or in a relatively low population and isolated area, perhaps a paper stamp scrip. If you are simply trying to rebuild a self-sufficient local economy but are not in dire need, a buy local rewards program may suffice as a starting point. If your municipality is bankrupt and people are dying of poverty, I think it may be time for the local government to create an emergency local currency program through plastic cards or paper local currency and jumpstart it by funding local services and community projects to provide basic necessities. Both Oakland, CA and Portland, OR have recently put out RFPs for municipal currencies. Preferably this sort of municipal program would be overseen by a community coalition to make sure it is actually meeting the needs of the community. If no one is responding in community and you want to do something fast and simple, host a neighborhood weekly or monthly swap meet or free market to share goods, food, skills and services. All it takes is a location, some flyers, door to door canvassing and one outgoing, friendly organizer.
There is no one answer. Perhaps your community needs an amalgam of different currency systems.”