Money: talk about a "damned if you do/damned if you don't" commodity. Thinkers have likened it to both manna and manure (as in, it's only good when it's spread around), credited it for both impoverishing and enriching the soul, called it a devil and a god. Each of us has experienced this doubleness in our lives, hungering for the freedom conferred by large sums of money as we spend the best hours of our days slaving to accumulate it. As P.T. Barnum said, money is a terrible master but an excellent servant.
But the problem really isn't money because money is just a medium of exchange, something we all agree represents a certain value; until the Federal Reserve was created, the value of money was based on everything from land to lumber. Part of the money problem in our society comes from the way we use money to judge and measure which things have value and which things don't. For instance, we can all concur that the unpaid labor of parents in the home, especially mothers, adds a significant amount of value to our individual and collective lives. But we will look in vain on the financial pages of the Wall Street Journal to find the daily going rate of that labor because our economy does not value it in money terms. And because the labor goes unvalued in money terms, we tend to assess the worth of the work, and consequently the worth of the workers, as valueless.
In our non-financial minds, however, we all know that such conclusions are bogus, that without this work, and the unpaid work of millions of volunteers, and the underpaid work of legions of janitors and lettuce pickers and so on, the visible money economy would be in dire straits. And this dichotomy underscores the nature of money in a capitalist society: something has value only if it carries a money sign, and only something which carries a money sign can have value. Everything else becomes invisible through the alchemy of denial.
It doesn't have to be this way, believe it or not -- alternatives exist, legal and workable. Many communities around the country have created "local currencies" or "community currencies," locally established media of exchange which circulate in a specific geographic place and which encourage a community or region's wealth to stay close to home rather than flowing into pockets in some far distant land. The currencies take a lot of different forms, from true printed currencies exchanged for goods and services like federal dollars to work or barter exchanges where no physical paper gets passed around to scrip programs like the ones instituted during the Great Depression. But a basic philosophical thread ties all these efforts together: the currency, rather than being a means of dividing and invalidating people, will instead be used to unify and honor the skills, talents, and ambitions of the people who hold it.
Here are some examples of successful efforts. The LETS program, started in 1983 in British Columbia, creates a tracking system for its "green dollars," which in reality record exchanges in goods and services among residents. The green dollars exist as records in a computer database; no actual dollars ever exchange hands. A measure of how powerful a LETS program is can be found in Western Australia, which started a program in 1992. In the first year alone 1500 businesses signed up and the program pumped A$3 million into the economy, all of which stayed in local hands because the green dollars could only be spent in the region.
The E.F. Schumacher Society in Great Barrington, MA, has pioneered a number of community-based economic efforts, including a scrip program, which allowed area businesses to find cash for expansion and renovation they could not have obtained elsewhere. Businesses would issue notes that could be redeemed at a later date for slightly more than their original worth, bringing liquid assets to the companies and small profits for the note-holders. As one Society official said, "A regional currency is ultimately the way that communities can regain [their] independence...from the federal system."
Perhaps the best known local currency effort is Ithaca Hours, started by Paul Glover in 1991 in Ithaca, NY. Ithaca Hours are actual currency, printed and then distributed among people who join up to participate in the program. The mechanics of how the Hours are valued and tracked is complicated, but the overall effect is to put purchasing power into the hands of residents which can only be used in the local economy, thereby magnifying its "turn-around" effect many times over. (A similar effort has started in Franklin and Hampshire Counties with the Valley Trade Connection.)
What's to prevent local currencies from becoming like federal dollars? According to Hours' founder Glover, it's the full faith and credit of your neighbors. People who start a local currency effort must always remember that its goals are to move away from valuing people's time and labor in dollars and to build ties of mutual respect and reciprocity among residents. That will keep it sufficiently inoculated. In this respect, local currencies take a step toward mending the destructive social problems generated by the greed of late 20th-century capitalism -- only a step, mind you, but one which teaches people that they do not have to be the slaves of an economic system that clearly does not have their best interests at heart. And that is a coin of the realm that could help us all survive.
(July 1996)