Replies to This Discussion

Permalink Reply by Hiram Crespo on September 30, 2011 at 5:00pm

Actually, the debt-based money that is controlled by the Federal Reserve and has no real tangible value (say, gold or silver) tied to it is only one form of currency, and it's not the safe form of currency. In the US we have the Liberty dollar which is a silver currency, but it's not in wide circulation. Ron Paul has proposed a currency based on the values of gold and silver and backed by them, which is the one that was in place in the early years of the U.S. but also several states issue their own local currencies - including parts of Texas, Charlotte has a 'plenty', Ithaca NY has 'hours' which are time-based and is a currency based on labor, D.C. has a local currency called 'potomac' and the Lakota and Anishinabe nations have their own currencies circulating.


The most successful example are the berkshares from Massachussetts, which trade at 100 berkshares for every 90 US Dollars at community banks in Berkshire, Mass. One must then spend the berkshares at local businesses. Businesses who accept berkshares are also encouraged to buy and trade with each other in order to take advantage of the 10 % discount that the local currency offers (all things are bought and sold for the same amount in both currencies).

What this ensures is that wealth stays in the same place for the long term, that local produce are consumed and keeps the community loyal and fiscally strong. It also gives small local merchants leverage against major corporations, since their goods can be purchased at a 10 percent discount.

More info on the berkshares
http://www.berkshares.org

Almost 400 local merchants accept the berkshare, groceries, cafes, theaters, pretty much all that is local can be purchased in the local currency.

Detroit also, in response to the current crisis, issues a local scrip known as 'cheers'.

I learned about community currencies or complementary currencies through the film '2012: Time for Change'. Gift certificates are the most recognizable example of scrips (another name for them). There are also virtual currencies, the most popular one being bitcoins.

Mutual credit societies have had popularity in Japan for some time, and these models are being replicated in parts of the US where great numbers of people have been chronically jobless and have a need for alternative ways to pay for basic goods. The currency in mutual credit societies is usually time-based (an hour of labor or service) and can be exchanged with any one person on the network, which is usually comprised of neighbors, family and people we trust. In this way, the flow of goods within that community is facilitated and basic needs are much more easily met without relying on the wage-slavery system.

In New York, the Ithaca 'hour' is one such currency. It's worth ten US dollars. Also, using labor instead of common currency ensures that chronically unemployed or poor people who lack the means to exchange goods can participate in the economy, even if it's through some labor here and there, to have their basic needs met. And so some level of participation in such networks serves as a type of insurance.

One other way to stimulate a local economy, particularly in agricultural or rural communities, would be to go back to a previous age when the currency was set as tied to the value of a crop, like when the Aztecs used the cacao as currency. Units of corn, or other goods, can also be tied to a currency: the idea again is that the currency must have SOME tangible value, and it's not based on debt and its credibility is not tied to the shady practices of the international banking cartel.

But of course, this unit poses a problem: goods that go bad and need to be consumed fresh would lose value fast. This is why labor, and gold and silver, are the healthiest monetary units.

This is all food for thought.

Here in the US, we need to begin seriously pondering financial and fiscal national matters on the scale that these social entrepreneurs are doing in many communities and create and support our local currencies. It's probably one of the most important things that we can do for now, until a new, more enlightened way of organizing our economy comes along. That way, if and when the Fed is abolished, those of us that can't afford to buy silver or gold these days won't find it so hard to adjust during the coming crisis.

Learn more about complementary currencies here:
www.opencurrency.com/

• ▶ Reply

Permalink Reply by Hiram Crespo on October 7, 2011 at 11:40am

Update: I just learned that this year Utah has recently approved the use of gold and silver coins to pay taxes there and for general commercial exchange, and there are other states following suit. It appears that alternative currencies are now going mainstream.

• ▶ Reply