A Currency of Our Own

By Elizabeth Harris - Staff Writer, Fourth Corner Exchange

“To be short of money when there's work to get done is like not having enough inches to build a house.”

~ Michael Linton, Open Money Manifesto

It was a beautiful summer afternoon in Port Townsend, Washington when a group of interested, activist trailbreakers met at Dundee Hill Center. They were there to discuss the true and abiding value of labor, the current status of money and the sensibility of establishing local currency.

Meetings like this are happening in countries everywhere, but “our country is way behind. Local currencies, in many forms, are thriving all over the world,” explains Chuck Estin of Wilder Institute, one of the meeting organizers.

Estin’s interest in local currencies goes back a number of years. Fascinated by its history, he was involved with Local 20/20, a Y2K currency. His interest led him to meet Francis Ayley, President of Fourth Corner Exchange, a thriving local exchange community in Bellingham. Ayley had been studying money and local currencies for years, having also founded highly successful LETS (Local Exchange Trading System) group in London.

Always interested in a more sustainable model of doing things, Chuck reports, “When folks in Pt. Townsend started talking about a local currency system, I asked Francis about the streamlined and very effective software used to operate the Fourth Corner’s barter system. He offered the use of Fourth Corner’s server.” From there, things began to gain momentum.

Joined by Deb Weise and Mike Dovkevichit it wasn’t long before Pt. Townsend’s first meeting, hosted by Dan Harbin, got underway. Deb, who’d been involved with Cascadia Hours, a barter program based on Ithaca Hours, commented that Pt. Townsend seemed like a natural spot for local currency. She shared information about the origin of the time dollar concept and how the process works.

Mike Dovkevich talked about the ’credit with no interest’ as well as the plain, common sense aspects of a time dollar system. He commented on the unmet needs and unused resources in Pt. Townsend (as well as other communities) and how local currency connects people in a unique way. He spoke of how local businesses can become involved.

About 25 people attended the inaugural meeting and engaged in idea sharing. Janet Kingsley, Senior Administrator for Fourth Corner, introduced staffers who’d come over from Bellingham to welcome new members, answer questions and offers ideas. The meeting was a lively one.

So, what’s up with all this buzz about time dollars? What are time dollars and why are they showing up? The answer to these questions is imbedded in the history of local currency itself.

Complementary currencies have been around forever, but they really came into play during the Great Depression when, in certain communities in Europe, they alleviated destitution by putting people to work exchanging real labor instead of symbolic money. Those communities thrived while others were dying.

It was in response to the 1929 stock market crash that the WIR Bank was established in Switzerland. Still thriving today, the WIR Bank is an independent complementary currency system that serves small and medium-sized businesses. It uses no scrip to facilitate transactions. Its purpose is to encourage participating members to put their buying power at each others disposal and keep it circulating. Although WIR started with only 16 members, it has grown to 62,000 members who, in 2004, traded approximately 1.65 billion in value.

Today local currencies operate in more than 35 countries worldwide, including all NAFTA, G8, and EU countries, as well as in Japan, Thailand, Australia, New Zealand, Senegal, Mexico, El Salvador, Peru, Ecuador, Colombia, Venezuela, Uruguay, Chile, Argentina and Brazil. The governments of at least 4 of these countries (Mexico, Argentina, Australia, and England) actively support local currency systems.

Community Currency Systems helped Argentina survive a bankrupt economy. They began as a single, 23-member “barter club” in 1995. Within 6 years, the number of people trading grew to an estimated 6 million. This network of people was able to survive and flourish during Argentina’s economic collapse in 2002.

Japan has been exploring variations on local currency/trade systems for health and elder care. They are currently experimenting with systems where individuals can gain credit for caring for elders locally, while getting credit for care for their own parents in another geographical location.

The variations on the idea of ’capital’ are stretching and redefining. SmartCards and other paper money alternatives are being introduced in a number of countries. Indeed, it appears possible that the world is, at least in part, trending toward a cashless condition. But being cashless is not the primary motive behind time dollars; humanization and value of trade just may be more important motivators.

Time Dollars empower people to convert personal time into purchasing power, which, of course, stretches cash dollars further. According to Edgar Kahn, president of the Time Dollars Institute, ii “They reinforce important community-building values such as trust and reciprocity while rewarding civic engagement and acts of decency that help generate ’social capital.’ Time dollars give society the opportunity to value activities in a way that the market economy does not.”

America, like it or not, is part of a global economic community that is experiencing dramatic and volatile economic shifts. Shifts that are causing whole countries to go bankrupt. In the words of Willis Harmon, author of Global Mind Change, “Large corporations are “downsizing” and dematerializing before our eyes. But even as we see increasing signs of the disintegration of the old (systems), we can see a host of new experiments, small enterprises, new forms of entrepreneurship, new worker-owner-management arrangements, new forms of community, alternative economies, which suggest that the replacement system is already in formation.”

The use of alternative (local) currencies is promising not only for the alleviation of poverty and a means for social equity in countries experiencing turmoil, but also as a way of generating and strengthening community ties, especially during times of economic distress. They represent a shift from social welfare approach to a “productive” approach, enabling individuals to redefine themselves as contributors to the common wealth. In the words of Harmon, “One of the most important functions of any society is to provide each individual with an opportunity to contribute to the society and to be affirmed and appreciated in return.”

Local currency systems invite us to reconsider our fundamental assumptions. By their definition, they ask us to reconsider value, money, labor and all the connections that link them. They shine a light on money as a symbol, whose value is based on the principles of scarcity, access to opportunity, favor, deprivation and a host of other constructed ideas. They lead us into re-evaluating what we call valuable and broadening our understanding of community.

Francis Ayley, founder of the Fourth Corner Exchange, explains. “The truth is, we’ve never had a universal money system designed to serve the best and highest interests of (all) the people.” And it is the best and highest interest of the people that becomes very clear in alternative money systems such as the Fourth Corner Exchange. Estin adds, “Money is a trust agreement. When we create our own, we learn to trust our own.”

These are just a few of the reasons that there’s a buzz about local currencies, why organizations like the Fourth Corner Exchange are thriving and so many other communities like Pt. Townsend are ready for alternatives. You can learn more about the Fourth Corner Exchange by visiting their website at www.fourthcornerexchange.com.

i) Complementary currencies describe a wide group of currencies or scrips that are designed to be used in combination with standard or other complementary currencies. They can be valued and exchanged in relationship to national currencies but also function as an exchange media on their own.

ii) The Time Dollar Institute is a non-profit corporation that creates and sponsors initiatives so that the beneficiaries of social programs can become co-producers of education, justice, self-sufficiency, opportunity, community development, and social change. The Time Dollar Institute can be reached at P.O. Box 42160, Washington, D.C. 20015.