His specialties are program development, research, data analysis, agent based modeling, computer simulation, monitoring and evaluation, complementary currencies, informal settlements, environmental programs, cooperatives.

In this episode, Will talks to us about his work over the past eleven years, organizing micro-entrepreneurs in poor areas of Kenya. Central to his work has been the creation of community currencies that have enabled a greater amount of trading and utilization of capacity in those communities. Recently, Will and his associates have been implementing digital forms of those currencies, and networking communities together in a wide area exchange system.

Grassroots Economics, https://www.grassrootseconomics.org
“Through community currencies people have a way to exchange goods and services and incubate new businesses, without relying on scarce national currency and volatile markets.”

Documentary on Will Ruddick and Kenyan Community Currencies, https://youtu.be/ojFPrVvpraU

How to Give People the Same Power As Banks, https://youtu.be/PfEW2atiB4s

Unblock HongKong – Interview with Will Ruddick – Director at BANCOR, https://youtu.be/OagQNEecZhA

M-Pesa, https://en.wikipedia.org/wiki/M-Pesa

This interview with Will Ruddick was conducted 2019 April 30.

Reposted from the Beyond Money Podcast

The post Will Rudrick on Community Currencies and Grassroots Economics appeared first on P2P Foundation.

To understand them and what they’re fighting for, it’s important to understand the system they’re challenging.

Our money system is underpinned by national central banks and treasuries that issue foundational “base” money. This includes the physical cash in our wallets and also reserves, the special forms of digital money that commercial banks hold in their central bank accounts, which are inaccessible to us.

These commercial banks then boost the money supply by issuing a second layer of money on top of the central bank money layer, through a process called credit creation of money (sometimes called “fractional reserve banking”) to create commercial bank money, which we see as bank deposits in our bank accounts.

The details are subtle and complex ― especially at the international level ― but the interaction of these players issuing money and taking it out of circulation makes the money supply expand and contract as if it were breathing. Monetary reform groups target different elements of this. Here are five of them.

1. Government Money Warriors

Stephanie Kelton, professor of public policy and economics at Stony Brook University, is one of the leading lights of modern monetary theory.

We say that the sun rises, but in reality the sun stays fixed and the illusion of sunrise is created by the Earth turning. Modern monetary theory argues that a similar delusion occurs in our thinking about government money ― we often claim that a federal government “raises money” through taxation and then spends it, but actually it is government institutions that originally issue money by spending it into existence and then withdrawing it from circulation by demanding it back in taxation. If the government issues money, then why would it have to raise money by asking for it back?

The idea that a federal government can run out of money like an ordinary household or business is an illusion, argue advocates of modern monetary theory. A government can only run out of money if it either does not issue its own sovereign currency (like the European nations, which have opted for the euro) or if an artificial political limit has been placed on how much money it can issue. In the latter situation, governments must first recall money via tax (and other means) before reissuing it elsewhere.

This is why modern monetary theory advocates are incredulous about conservatives who want to block spending on education and health care by saying we don’t have the money to pay for it. “Governments with monopoly control over their currency can always pay for their policy priorities,” says Pavlina Tcherneva, an economics professor at the Levy Economics Institute at New York’s Bard College.

Under modern monetary theory, if there are unemployed people who want to work and material resources for them to work with, a federal government can issue new money without causing inflation because the increase in money supply will be met with an increase in production. “The goal is to use the public purse to serve the broad public interest without accelerating inflation,” said Stephanie Kelton, professor of public policy and economics at Stony Brook University and former senior adviser to Sen. Bernie Sanders (I-Vt.).

2. Bank Money Reformers

Bank money reformers want to target the powers of commercial banks to create money.

Other reformers target the commercial bank money system. They argue it creates economic instability, over-indebtedness and concentration of power in the hands of banks ― the very banks that led us into the 2008 financial crisis.

Bank money reform groups include the American Monetary Institute, Positive Money, and the International Movement for Monetary Reform.

Commercial banks create new money when they issue loans. The moderate wing of the bank reform movement argues that, because the government grants them this privilege, banks should be subject to greater democratic scrutiny over their lending. The hard-line wing believes bank creation of money should be banned altogether.

The movement to curtail bank money is politically more diverse than modern monetary theory; it’s been supported by certain libertarians, including the late economist Murray Rothbard, neoclassical economists such as Irving Fisher, as well as left-wing proponents, such as the U.K.’s Green Party, which believes bank money-creation leads to environmental crises and corporate domination.

Their prescriptions are not uniform: Positive Money, a research and campaigning organization in Britain, calls for the power to create money to be granted exclusively to a democratic, accountable and transparent public body, creating a “sovereign money” system in which we might all have our own accounts at the central bank. This is distinguished from full-reserve banking, which would require your bank to have the reserves to fully back your account.

3. Cryptocurrency Crusaders

The Bitcoin logo on display at the Consensus 2018 blockchain technology conference in New York City on May 16.

Cryptocurrency crusaders not only reject both national and bank money systems, but also reject the entire concept of credit money (money that is “created from nothing” through law or social agreement), calling for it to be replaced with “commodity money” (money that is “created from something” through production). They have inherited the baton from “goldbugs,” who called for gold to be money.

The movement, which began with Bitcoin, argues that the best money system is one that’s outside of human politics. This comes from a philosophical tradition that says systems should be governed by the boundaries of God, physics or math, rather than laws set by politicians. With gold, for example, these natural boundaries would be geology: how much gold can be found and extracted. In Bitcoin’s case, the boundary comes from the fact that the digital system sets a hard limit on how much digital money can be issued and then forces participants to “mine” it as if it were a commodity.

Because Bitcoin hard-liners believe true money is a limited-supply good that must be extracted through production, they claim that fiat money ― created by banks or countries ― is artificial or deceitful money under the control of corrupt powers. There’s a puritanical edge to these cryptocurrency crusaders, who mistrust human institutions and trust in an abstract ‘godlike’ order of mathematics and markets.

While theories like MMT hinge on collective human political institutions, crypto crusaders see politics as foolish. This distrustful attitude shows: The movement sometimes seems as much at war with itself as with the fiat money system, with bitter in-fights between supporters of different crypto-tokens.

They are, however, the richest of all monetary reformers, with many crypto users having ironically become millionaires in the fiat currency they claim to dislike so much.

4. The Localists

A note worth 10 Brixton pounds, an alternative currency in London, is illustrated with an image of David Bowie.

There’s a whole history of alternative non-government money prior to cryptocurrency. These original alternative currency variants include mutual credit systems, timebanks (where time is used to measure how many credits you earn), local community currencies, such as the U.K.-based Brixton pound, and systems like the Swiss Wir, a currency used between businesses.

The tradition is also skeptical of large-scale government-bank money systems, but rather than calling for them to be replaced by a robotic algorithm, they believe small-scale communities should take control to issue money locally.

Unlike cryptocurrency advocates, they have no problem with money being “created out of nothing.” Rather they have a problem with who gets to do that and at what scale. They believe large-scale systems alienate people and dissolve close-knit communities.

A mutual credit system like Sardex in Sardinia, for example, does not reject the idea of money expanding and contracting, but it brings together an island community to decide on what terms that occurs.

While the other movements are outspoken, local complementary currency enthusiasts are often humble and below-the-radar, working for low pay to build resilient community structures.

“Local currencies change how money is issued,” says Duncan McCann of the New Economics Foundation, “how it circulates and what it can be spent on in order to re-localize economies, encourage environmental behaviour, and promote small businesses.”

The crypto-credit alliance looks to merge older, alternative currency systems with blockchain technology.

5. The Crypto-Credit Alliance: Mutual credit meets blockchain technology

This is the least-known or developed of the movements, but is perhaps the most exciting. Nascent initiatives, such as Trustlines, Holochain, Sikoba, Waba and Defterhane, seek to hybridize older alternative currency systems like mutual credit with the blockchain architectures that underpin cryptocurrencies. They share common ground with both modern monetary theorists, who also see commodity money as regressive, and cryptocurrency advocates, who wish to bypass the government.

Cryptocurrency unleashed a lot of creativity, but much has been wasted on toxic speculation. On the other hand, localist mutual credit movements have powerful ideas but often struggle to get heard or to spread. Crypto-credit innovators are exploring the creative possibilities of merging these two to solve flaws in both.

Originally published in the Huffington Post

The post These 5 Rebel Movements Want To Change How Money Works appeared first on P2P Foundation.

Niko Georgiades: Athens, Greece – Tools born from the internet, applied across autonomous networks and movements seeking alternatives to capitalism, are providing the infrastructure of alternative societies. In the last of our specials on community currencies and alternative economies, we showcase FairCoop, a self-organized and self-managed global cooperative created through the internet outside the domain of the nation-state.

During a conference on alternatives to capitalism inside of the self-organized and squatted Embros Theater in Athens, Greece in the summer of 2017, a Catalan speaker (who remained anonymous for safety purposes) gave a presentation on FairCoop, which informed much of this reporting.

Alternative economies are typically separate economic structures operating outside of the traditional economy and based on the common principles of a community. FairCoop is a function of an alternative economy and was built out of the necessity to provide an “alternative system outside of capitalism” and merge many autonomous movements and networks together to form a society based on each community’s values.

FairCoop was created a few years after a nearly half a billion euro banking system expropriation action from 2006-2008, generally attributed to Enric Duran. The expropriation of monetary value from the banks was used to fund social movements and as a way to jump-start alternatives to the capitalist system.

Watch the video below for an introduction to FairCoop:

During the presentation on FairCoop, the speaker inside of Embros Theater said that in Catalonia, Spain, around 2009, 2010, the Catalan Integral Cooperative (CIC) was created, to “build another society by self-organizing” and to provide the needs of the people, “from food, housing, education, and health, etc.”

Since the creation of the Integral networks in Spain seven years ago, “a lot of people [have been] working for the commons” as there are more than 1,000 projects that are autonomously self-organizing to create cooperative networks of sharing.

Watch the video below, or see our full report here, for more information on the CIC [also see The Catalan Integral Cooperative: An Organizational Study of a Post-Capitalist Cooperative by George Dafermos]:

The idea for FairCoop was brought to an assembly in 2014 as a proposal by Enric Duran and was created by people within the movement to serve as economic infrastructure for a new society.

The Catalan speaker described FairCoop as “an open global cooperative, self-organized via the Internet and remaining outside nation-state control,” but one “that is controlled by a global assembly.” The speaker explained, “We don’t say cooperative in the traditional way, we say cooperative because we work with economy and we work in a participatory way and in a equal way.”

The steps taken to get to the point of the creation of FairCoop were explained by the speaker as followed:

“The first action was hacking the banks [expropriation of money through the internet], the second action was hacking the state [creating a taxing system to fund the creation of autonomous alternative systems], and the third one was hacking the money markets.“

“Usually the powerful money markets attack the weak economies and they get their resources with inflation and things like that. So, for centuries people have lost a lot of resources, a lot of capital” from those in control of the money – the speaker continued, “with FairCoin we are, like, revenging on that, let’s say, and we are recovering value.” They are growing that value to “use it for the commons” and assist in building their self-managed alternative society, said the presenter.

“They’re are many people in more than 30 countries” that have combined their local currencies and communities into autonomous local nodes and are connected in a network of cooperatives, said the speaker, who gave examples in the presentation about a Guatemalan and Greek sharing network.

“Local nodes acts as decentralized local assemblies of FairCoop, and meeting point between global projects of FairCoop and the various projects developed locally, creating links, synergies, knowledge development and growth of the entire ecosystem we are creating together. Autonomously, they serve as a point to spread, help and welcome people in FairCoop, as well as an exchange point of FairCoin.” – Description of a local node, FairCoop website

To build “a society without money, takes money,” and also requires having a plan to fight against capitalism by empowering the “local, regional, and global level,” so, the speaker said FairCoop created a “global assembly” to determine the value of the currency in a way of “self-management in the political process, not in the market“.

Listen to the fifteen minute presentation on FairCoop (full presentation with Q&A session is further down the post):

Audio Player

FairCoop was described as “a political movement building an alternative” that operates with many open decentralized working groups and assemblies deciding by consensus what actions to take in the FairCoop.

“FairCoop understands that the transformation to a fairer monetary system is a key element. Therefore, FairCoin was proposed as the cryptocurrency upon which to base its resource-redistribution actions and building of a new global economic system.” – FairCoop website

FairCoop utilizes FairCoin cryptocurrency. Cryptocurrencies, the most famous being Bitcoin, are digitally created on the internet, decentralized, and out of the control of central governments.

The difference between FairCoin and Bitcoin, said the speaker, is that “in Bitcoin, they are not one community, there are many different interests fighting each other, like what’s happening in the capitalist world is happening in the Bitcoin.”

They utilize FairCoin to the “benefit of the self-management of the alternative economy, not in the benefit of decentralizing capitalism that is around Bitcoin,” and to economically sustain the process of building the network of FairCoop.

For a bit of an explanation on what FairCoin is, watch this excerpt of an interview with Theodore, from the Athens Integral Cooperative, below:

Cryptocurrencies are block-chain transactions tracked through public ledgers, however, FairCoin has recently created the world’s first ever “co-operative blockchain … by creating an algorithm based on mining processes that rely on a proof of co-operation.”

FairCoin was developed “as a transition tool for building that eco-system at the global level that can be useful for supporting the building of autonomy and the building of self-organizement” around the world, said the speaker.

The speaker said that with the self-management of FairCoin, they are recovering value instead of extracting it from the people as the current banking system with its money markets does.

Faircoin governance image

In efforts to control all of the FairCoin, 80 to 90 percent of the FairCoin is now in the hands of the “movement“, said the speaker. With FairCoin, the value of funds is over 2 million euros and the speaker said, “this is just the beginning of the way how we are creating value by this hacking.”

When asked for a practical example of how FairCoop could be put to use in the self-managed Embros Theater, the speaker said that the first step would be to start accepting FairCoin for the transactions of economy inside the theater, such as beer. The next step would be to share that you accept FairCoin, which will then be seen in the FairCoop network and when more people start exchanging FairCoin, local nodes create assemblies focusing on different qualities that branch out to the global networks.

The speaker touched on Freedom Coop, which according to their website, is a “European Cooperative Society (SCE) that creates toolkits for self-management, self-employment, economic autonomy and financial disobedience for individuals and groups striving for fairer social and economic relationships.”

On the larger scale of building “a new way of life,” newly created Bank of the Commons is “a project for bringing on an alternative banking system to the world“, said the speaker, who explained it’s a way to bring different movements, cooperatives, and different groups the “capacities for doing their activities without the control of the normal banks.”

See the 2017 FairCoop Structure Chart for a visual learning experience of how the networks connect to each other:

After the presentation by the Catalan speaker, dozens of audience members asked many clarifying questions as to how this system of an alternative economy works. The presentation lasted a bit over two hours. Listen to the full presentation below:

With the building of these networks of social economy and solidarity, people are rethinking their ideas of how society could be more equitable. Creating alternative economies using the internet and autonomous working groups to decentralize the power has many people in Europe and across the world very excited at the prospects of a new society outside of capitalism and nation-states. In the words of the speaker, the future of mass movements providing real change are based in being able to have economic power, “As a movement, we need to be stronger economically to be stronger politically.”

The post Greece: Alternative Economies & Community Currencies Pt. 3 – FairCoop appeared first on P2P Foundation.

Today’s WIR-Bank, originally the Wirtschaftsring (“Economic Circle”), was founded in 1934, in the depths of the Great Depression. It was based on the ideas of Silvio Gesell, a German-Argentine merchant and economist who saw how ordinary money circulation had collapsed. Money fearfully clutched rather than freely exchanged only makes a downturn worse.

By reinventing their own currencies based on long-term reciprocity among community members – rather than gold or central bank limits – communities can break this vicious cycle. Hundreds of such currencies sprang up in the Great Depression, as noted by Yale’s Irving Fisher, the early monetary economist.¹ Recent research by the authors² confirms that WIR circulation does indeed accelerate in a recession; as people hoard their limited holdings of Swiss Francs (SFr), they are more willing to use WIR for market exchanges.

WIR are actually somewhat less valuable than SFr because they are less negotiable: not easily changed for another currency, nor accepted outside the circle of WIR users. But that circle of Swiss circulation is fairly wide. In 2013, WIR counted some 50,000 small and medium enterprises (SMEs) among its clients, enabling 1.43 billion Swiss Francs (SFr) of trade, or US$1.59 billion.³ About 80 percent of WIR users are SMEs and larger firms; the rest are households.

What is the social basis of the WIR’s long-term reciprocity among people? Textbooks on the origin of money usually start with the “double-coincidence of wants” problem: If you and I are both to benefit from barter, it’s not enough for you to want what I have – you also need to have what I want. As the division of labor grows, such double-coincidences are harder to find. We need to find long circular chains of single coincidences, wherein A gives Bread to B, who gives Cheese to C, who gives an Apple to A. Money helps solve this problem by serving as an intermediary “good” that everyone wants.

This explanation begins and ends with individual wants. But our species has not survived primarily by such exchange. A century of anthropological and historical research shows that it was gifts – not money or barter – that brought the original human economy into being.⁴

In his Great Transformation, Polanyi characterizes the gift economy as “free gifts that are expected to be reciprocated, though not necessarily by the same individuals – a procedure minutely articulated and perfectly safeguarded by elaborate methods of publicity.” This is the original solution to the “double coincidence” problem – a network of multilateral gifts and reciprocity between individual and group – not just two individuals.

Even the earliest forms of currency were community records, not impersonal stores of value. Lietaer’s Mystery of Money describes pottery-based currencies centered on ancient temples to Mother Goddesses and medieval shrines to the Virgin Mary. These early monies were a way of remembering personal indebtedness. The Latin root for “monetary” – deriving from the temple of , the mother goddess who “monitors” all exchange – reflects this fact. The WIR is Juno’s descendant, a way of monitoring multilateral (not just bilateral) reciprocity, within a community of named individuals.

Impersonal money as the basis of trade came much later, allowing the economy to stretch far beyond interpersonal community. But this new impersonal money creates its own new problem – How should its quantity be controlled? Too much means inflation and wasted resources; too little causes deflation and unemployment. Precious metals are an arbitrary form of control, and central banks a blunt one. History shows shortages and gluts for gold and silver, and the limitations of central banks are confirmed by current conditions.

The supply of WIR is not limited by gold or central bank “base money” – it grows by as much or as little as people are willing to trade in it. That willingness is greatest (a) in a recession, (b) in highly cyclical industries like construction and hospitality, and (c) among those shortest on cash. Unlike ordinary money, it flows where it is most needed.

WIR is a community currency, but at even its small-nation scale, it is no longer highly “communitarian.” Time Banks (US), LETS (Canada) and Fureai kippu (Japan) are other notable currencies that are closer to their community roots. But like all of these, the WIR recreates an awareness of need-based gift exchange. It may be the form of exchange to which our species is best suited.

James Stodder (USA) teaches economics and econometrics in the School of Management at Rensselaer Polytechnic Institute and the Management Department at the US Coast Guard Academy. His research is on exchange systems, behavioral economics, inequality and economic anthropology.

Bernard Lietaer (Belgium) is the author of The Future of Money (translated into eighteen languages), and an expert in the design and implementation of currency systems.  He codesigned and implemented the convergence mechanism to the single European currency system (the Euro) and served as president of the Electronic Payment System at the National Bank of Belgium (the Belgian Central Bank).

Photo by AlicePopkorn

The post Patterns of Commoning: WIR Currency – Reinventing Social Exchange appeared first on P2P Foundation.

“Bruno Chies: Let me go back to complementary and alternative currencies. Do you mean they are a way to empower people directly on a local level?

Matthew Slater: If they would work, they would empower people. But they don’t work when people don’t use them. If they were to be used, it would mean that communities are acting in solidarity with each other are empowering each other. The reality is that most people don’t seem to feel very much solidarity others and they certainly don’t express that by using a complementary currency. So, the tool is there but we lack the consciousness, awareness or will to use it. We the people, need to start working together, taking on responsibility, taking on leadership roles, and not relying on authority figures and governments to do it. This is difficult because we’re also paying taxes. There’s not a lot left over these days. We tend to chase the money and we do what the people with the money tell us to do. Which leads to the need to compete with each other and the wasting of resources in the process. If we want to be sovereign, we have to either find sources of money that don’t come with a value obligations, that are already aligned with what we want to do, or we’ll have to do without money.

Talking about real utopias, you envision an economy in which complementary currencies play a role but economy is not fully monetized. There are spaces in the economy for gift, barter and exchange with complementary currencies.

In this utopia what people would do would be a much closer expression of what they value, because they don’t have this top-down monetary system, expressing the values of either the tax recipient, the philanthropists, or the trillionaires. You wouldn’t need everything to be monetized. Everything is monetized now because the economy is huge and it still has to grow. More things have to be monetized so that a greater proportion of our activities can be taxed and more money has to be borrowed. If that wasn’t the case, then there would be much less need for money. It’s by no means an impossible utopia, there already are tiny societies working like that. It seems that when our societies grow bigger they become dysfunctional. We need to bring the self-determination level down to the local, small groups, because the system is less easily corrupted this way.

That makes sense, and I think this is a very good bridge to your Credit Commons project. Is this a way to connect local economies operating with complementary currencies and create more solidarity?

Yes, I think that’s exactly it. The tag line is ‘money for the solidarity economy’. Some people would argue that it’s not money, it’s merely a system of exchange. But that is a function of money, so it depends on what your definition of money is. It seems to me that what’s needed is a global protocol to help us exchange with one another. Credit Commons could be used locally or intercontinentally; it’s only a protocol.

How does it differ from other platforms, like Community Forge or Community Exchange System (CES)?

Because it’s a protocol, it is not a platform. CES is a platform with hundreds of groups in it that trade with each other and have nominal balance limits that are not harshly enforced and there isn’t really any governance about what the credit limits or the exchange rates should be. The Credit Commons seeks to formalize that arrangement as well as open it up to groups outside that platform. The only requirement becomes running software that implements the protocol. I’m also likening it to a cryptocurrency. It’s not a currency but it is a distributed ledger and that means we can all agree on what the ledger says.

Is it based on blockchain?

I haven’t gone so far as to specify the blockchain. It would be a consensus algorithm. For example, Ripple… It’s called a permission blockchain, which means you don’t need the mining. The clients trust each other, so they don’t have to fight or compete. They trust each other and the ledger stays intact, as long as they’re all good. That means an outsider cannot come in. The thing about Bitcoin is that anybody can implement the protocol and participate, but they have to do the mining to make sure it’s good. In the permission blockchains you just do it with your friends and the people you trust.

So you really build trust, not through code, but through people.

It’s trust at two levels: 1) if I give you credit, I trust that you’re going to pay it back, and 2) we’re both participating in a trust group, with protocols, and I trust that you’re not gonna hack the ledger. However, I’m not an expert in the software’s architecture, so I’m leaving that open at the moment. The aim of the Credit Commons white paper is to create discussion.

How does that apply to the issue of convenience when using money? A problem with complementary currencies is that they’re very limited in scope and are not very convenient. Do you think that the Credit Commons could change this?

Yes, it should, but not directly. At the moment each complementary currency is working pretty much with its own software or with a family of softwares, but there is no grand interoperability plan, there are no protocols that everyone agrees on. If the platforms are joined together through the Credit Commons but every group is still using their own software, those issues are still exactly the same. It becomes possible for credit to move between platforms when they use a common protocol, a backbone to the system. A platform would have a payment form that facilitates paying somebody in a different platform. But that still doesn’t help you pay for the groceries in the shop.

It might give you access to other markets…

Yes. That’s one reason why we also need to work on the advertisers’ API, in order to see what’s in other markets. There isn’t any way to do this yet.

Are you seeking software developers to this project?

I’d love to involve some developers in this, but it’s hard. We’re talking about hundreds of existing communities that are expressing a real need to go forward in radical reforms and cooperations. I thought this would be very appealing to developers, to have a chance to write some software that will be used in this way. Many activist developers are imagining what’s needed and they think ‘if we write this, we’ll save the world’, and then it doesn’t happen.

Perhaps your advice to activist developers who want to make a difference in the world is to re-learn how to cooperate and collaborate…

And to adopt an attitude of service. You can collaborate and still build something that nobody needs. Be sure that you’re serving people whose values you agree with. That might not be the way to write an app that goes viral, but it is the way to do something that really is useful. Otherwise you’re taking an all or nothing risk.

The term commons usually takes me back to the work of Elinor Ostrom and the question of governance: how can people find ways to govern these commons? How does that work in terms of money and credit in your proposal?

There’s no credit without governance. In Debt the first 5000 Years, David Graeber drew a sweeping portrait of history in which there are times of stability, which is to say times of governance and trust in systems, when we used credit money, and times of instability, when there is a lot of conflict between nations and governance wasn’t something that could be relied upon, which are times of commodity money. Governance is even more important than money. What we need is systems of governance that help us organize ourselves. Money and credit arrangements will follow. There are many people involved in monetary reform, and for many it’s a very compelling subject, but ultimately you cannot really get anywhere with money. The solutions have to be situated at a deeper level. The issue about creating a commons and governing it, is what I’d like to bring attention to with the Credit Commons. We need to think in terms of forming groups of solidarity and have those groups form groups. The Credit Commons presents this sort of nested structure of groups of trust.

Basically it’s an architecture for scaling up trust and solidarity.

Yes, I believe we could do the whole global economy that way.”

Photo by sociotard

The post Matthew Slater on scaling trust with Credit Commons (Part 2) appeared first on P2P Foundation.

Biography

Matthew Slater is a software developer and has been involved with complementary currencies for at least 8 years, since the crash of 2008. He is the co-founder and main developer of Community Forge, a platform for complementary currencies that runs more than 150 LETS and Time Banks. Together with professor Jem Bendell, he has also designed and is a tutor of the free massive open online course (MOOC) Money and Society, directed at people who want to understand money from a social innovation perspective. Education about money and all that it implies is a critical part of what Slater does.

Interview – Part 1

“Matthew Slater is a community currency engineer. He proposes a technology that will scale trust and solidarity beyond the local level, for communities running their economy with their own currencies. ‘You could do the whole global economy that way’, Slater envisions in this new monetary architecture of interconnected complementary currencies. There is, however, no sense of gullible techno-fetishism in his ideas. He is very much aware that technology, and top-down reforms to the monetary system, are not enough to change power relations in society if they are not accompanied by a simultaneous change of consciousness among the people.

In this interview, we discuss his project the Credit Commons (part 2), in greater detail, as well as broad range of topics: his reflections on our contemporary monetary system, the role of complementary currencies for achieving more self-determination at a local level, the importance of governance for the Credit Commons and his view on a more collaborative economy based on solidarity, where relations intermediated by money would be not so prevalent.

Bruno Chies: Let’s start with a very general question: What is wrong, in your opinion, with today’s state-backed money?

Matthew Slater: It’s hard to separate what’s wrong with money from what’s wrong in everything else in society. The fundamental problem with the design of money is that it’s treated in all respects as a commodity which is owned by rich people and lent to everybody else, while money should be a medium of exchange first and foremost. In fact, rich people don’t own money, they’re actually lending it out of nothing. They do have their own assets, but what they’re lending is a legal fiction and it is a privilege that they have been given by the government, the crown, the sovereign, whatever, and can then charge interest on. So that’s a problem that goes deeper than the monetary system, to the system of privilege in society.

BC: What do you think about proposals of monetary reforms at the level of the state, like the Positive Money proposal in which money should be created debt-free and solely by the government, through a democratically accountable committee?

MS: I think it’s great if you regard the monetary system as a separately individual system. But as soon as you start bringing in the critique that a government is owned by corporations, this changes. You start seeing that either a reform like that cannot happen at all, in which case all you can do is raise awareness about how bad things are, or you can say that if it did happen somebody will get to this democratically accountable committee. That committee will never be neutral.

It is not simply a matter of redesigning money and the purpose it should serve…

I think that’s naïve. Money reflects our attitude towards the government, our attitude towards the rich and their attitude towards us. If you changed money, but not the attitude, the attitude would change it back. Money isn’t real, it’s only a reflection or projection of other power dynamics in society.

What do you think is the role of complementary and alternative currencies in the process of transitioning to a different social model?

I think they have several roles. One is to prototype. Another one is to understand more deeply how these systems work. Yet another is to take a little bit of sovereignty into our local groups. I think those are the main ones.

The idea of taking back sovereignty sounds like it is about taking back power and expanding democracy. It this what you mean by it?

I don’t know much about the history of the word sovereignty, but it usually starts with the king. The king is the sovereign and nobody tells him what to do. Sovereignty is not something we can all strive towards, but greater self-determination is something we could. This will always be at the cost of whoever is telling us what to do and how to be. I would like to see a society in which people exercise greater self-determination. A complementary currency could build trust and issue units among a group that wants to exercise a little bit of economic power. Typically, they will issue these units out of nothing, as if they had currency or as IOU credit obligations, because you don’t benefit very much from a currency if you have to buy it first…

Which is the difference between commodity-based currencies and credit-based currencies…

Exactly. You can exercise some sovereignty by creating a unit of account and everyone agreeing that to value it in exchange with each other. These units of account are worthless to anyone outside that group, so they can’t be taken away in tax. It also provides a way to build your own taxing system which leads to self-determination by allocating those resources. When groups come together to work in solidarity, there are loads of devices they can use, hacks and things like that, and a currency is one of them. It helps them to allocate resources and helps them to agree on what they value together.

Such as issue new tokens in order to fund collective projects?

It would be very similar to taxing and spending. If you issue new tokens, their value will go down, but the issuer takes the spending power. This is exactly what governments do. In theory, they spend, which is an act of issuance, and then tax back to prevent the inflation. It’s not the other way around, as the myth of handbag economics suggests. In this myth, the government is like a household, that has to earn before spending, and money is treated as a commodity. If you spend more than you take in, you have to borrow and pay interest. On one side of the economy, ordinary people would earn and then spend, and on the other side, the government would spend and then earn, which would make a good cycle. Now, along with others in government, George Osborne of the British Conservative Party is saying that the government should run a surplus, which means that the rest of the economy must run a deficit. That’s a problem. It looks good for the government because it can say it’s not spending too much, but at the same time it forces everybody else to spend too much.

And go into debt…

The government’s role is to issue money by spending more than it takes back in tax. The difference is the supply of money. That is the theory of fiat money, which we don’t have anymore. Currently, the supply of money is all that the banks lent, that hadn’t previously been saved. The banks have taken on the role of sovereign.

They are creating money out of nothing.

Yes, and that’s a very serious issue because it is impossible to argue that the banks are working with and for the people in their act of issuing money. The banks are profiting from the people by their very constitution. So Positive Money, in restoring the money-creating power to the state is at least trying to tell the story that the state is in partnership with the people, and that, rather than banks, the state has the legitimacy to be sovereign and to issue money. Of course, (neoclassical) economists do not acknowledge that what the banks are doing is issuing money, their theory is that banks only lend money that already exists. But this turned out to be false, so false, that the Bank of England admitted to it two years ago. This myth is taught in economics classes still and the implications of its wrongness are very profound.”

This is the end of Part 1 of this interview. Part 2 discusses the Credit Commons.

The interview was originally published at the Institute of Network Cultures (INC).

Photo by Trenten Kelley

The post Matthew Slater on scaling trust with Credit Commons appeared first on P2P Foundation.

Jack of All Trades Universe (a.k.a. JoatU) is a revolutionary, community-based, online economic system! Find out about classes, goods and services you can trade for, and organizations to lend a hand at – all in your neighborhood.

Never feel bored or poor again. JoatU transforms economic competition into cooperation. With JoatU, you can cash-in on your trades and talents with an alternative form of humanitarian currency.

Together, we have it all.

Inspiration

We want to change the world. Nothing else, nothing less. People have been isolated and individualized for far too long. The drive for community life is pulsing through our veins. Without it, we will never have self-esteem. Without it, we will never realize our full power and purpose.

Enter JoatU!

It’s time for an EASY WAY to meet all the people who want to live with autonomy and interdependence. It’s time to exchange our infinite amount of talent and resources to build and create a more vibrant, productive, and uplifting society on the local level. It’s time to personalize our transactions. JoatU is the opposite of faceless online shopping. It facilitates interaction-filled exchange with thousands of people following their passions! Anyone – with any income level – can participate.

Birth

JoatU’s was born on October 5th, 2012 when founder Jamie Klinger woke up completely filled with inspiration.  He logged onto Facebook and messaged about 100 friends asking one simple question:

What skills would you offer out to someone if you could put that time into a bank and use it to buy other services?

The variety of skills and offerings his friends were willing to exchange blew Jamie away.  There was a market!  He had too many friends with too many incredible skills and not enough full-time employment to go around.

From that day forward, he started building a platform to make these exchanges as natural and simple as possible. That platform is JoatU.

JoatU front page

Big Update!

Since launching this campaign, we have attracted a talented programmer, Alex Willemsma who began developing JoatU in Ruby for free as soon as we began sharing ideas.  He has over five years of experience and was one of the early developers of the Couchsurfing.org website.  Our ideals are aligned. So much so that he has graciously offered to take on a more full-time position to help develop a first iteration of JoatU for close to minimum wage; much less than any other offer.

Thank you Alex!

Financial Breakdown

Stretch Goals

Any amount over top of the initial $5000 will go towards covering our initial costs, hiring more developers, designers, and help with project management and business development.  Those who have donated will be invited into a Loomio group to help decide how to best spend the money beyond $5000.

Possible developments we could implement include:

*Group offers: A group of individuals make a community offer.

*Decision-making for communities with the integration of Loomio

*Crowdfunding application for communities built right into the site so you and your neighborhood can start raising all the funds needed for your local neighborhood projects.

We will also make our way out into your communities and get as many local businesses involved in accepting JoatU as possible, taking the value of our community-created JoatU Unit to the next level, allowing you to buy more of your necessities through locally-owned businesses.

Once JoatU is properly built, we hope to be able to funraise internally using JoatU Units as payment for certain aspects of development.

JoatU profile page

International Crowdfunding Tour

In one of the very first informal JoatU exchanges, Jamie Klinger offered to help Johnny Coull crowdfund $5000 to launch his album which he successfully did.  Now, Johnny Coull is taking Jamie across Canada and the US to a) Promote his new album (available on Bandcamp) and b) Promote JoatU’s crowdfunding campaign!

From April 24th to June 24th, Jamie travelled across Canada and the US spreading the idea of JoatU and gethering market research on how different people perceived the idea.

Cities traveled to: Toronto, Guelph, Minneapolis, WInnipeg, Brandon, Regina, Calgary, Edmonton, Kamloops, Kelowna, Vancouver, Victoria, Seattle, Portland, San Francisco, Oakland, San Jose, Santa Cruz, Houston, New Orleans and Northampton before settling back in Montreal.

JoatU search results

How will the project sustain itself after the campaign?

JoatU is in the process of developing win-win economic partnerships with local co-operatives, maker-spaces, for-profit businesses, and organizations. JoatU will also generate income by supporting local advertisements (if our communities allow it), as well as generate a low-cost freemium model for supporting members (like you!). We will also seek grants and donations similar to non-profits.

 JoatU would like to give thanks to a major inspiration, the folks at Loomio who have helped inspire us tremendously!  Please support them too!

For more information, check out all the info on http://www.joatu.com

Thank you. Don’t wait!  Donate today!

Please support JoatU’s campaign here

The post Help build the Jack Of All Trades Universe appeared first on P2P Foundation.

This is also a call for developers to this volunteer project, if you are a developer you can find Joatu on GitHub

What is JoatU, exactly?

It’s a web application that allows to offer services and products, and it’s a complementary currency “Jack Of All Trade Unit” supporting local community projects by direct democracy.

Joatu is an initiative that is interesting from several perspectives. One of the things is that the algorithm of generating this complementary currency is different from other currencies, and based on the evaluation by the community. This makes it interesting from the computational point of view. Another thing is that as a “Jack Of All Trade Unit” it can encourage the community to share a variety of different services and products with each other. This means that one person can exercise her/his different skills and does not have to specialize in just one.

We’ll try to look more deeply into these different aspects of this project in the follow up interview with Jamie Klinger.

The post Project of the Day: JoatU — Community-driven Economics appeared first on P2P Foundation.