Revival of local currencies during the past 25 years proves that communities can issue money to create green jobs, fund local nonprofits and farms, make interest-free loans, and connect residents as fellow workers.
The Ithaca HOURS money that I started in 1991, for example, has traded millions of dollars value among thousands of residents and 500 businesses. Each colorful HOUR, depicting local children, trolleys, waterfalls and bugs, is valued at one hour of common labor or $10.00, which doubled the 1991 minimum wage.
Responding to explosive media interest, by 1995 I wrote the book Hometown Money: How to Enrich Your Community with Local Currency. Thousands more such currencies have since emerged worldwide, both paper and electronic credits. HOURS, Time Dollars, Berkshares, LETS, BitCoin and dozens more formats have begun to establish alternatives to the national monies controlled by elites.
Control of money decides where jobs are available and for how long. Control of money decides who owns land and what gets built. Control of money decides what is legal and what's a crime. Control of money decides who lives well and who struggles. And ultimately, control of money decides who lives longer and who dies sooner.
At the same time, all national currencies are in debt to nature, serving human economies that extract from nature faster than we restore. When tney collapse, HOURS will trade independently. Labor will become the new gold standard.
Several key lessons about successful local currency have been learned during the past decades. These are featured in the new second edition of Hometown Money. Currency systems that have survived and grown embrace these lessons, while others that launched enthusiastically faded away.
Chief among these is that starting a local currency is like starting a credit union or a food co-op. It is a community enterprise. It cannot be merely administered by a nonprofit board of directors, It must be managed by a full-time Networker, or two or three, depending on the size of your community. Just as national currencies have armies of brokers helping money move, local currencies need at least one paid Networker. They promote and facilitate circulation. Your volunteer core group–your Municipal Reserve Board–may soon realize that they've created a labor-intensive institution. Playing Monopoly is easier than building anti-Monopoly. You can reduce your need to pay the Networker with dollars, by finding someone to donate housing. Then find others to donate harvest, health care, entertainment. Regardless whether national and global economies boom or bust, were rich when we know local people with whom we can trade, to meet our needs.
Ultimately, wealth is not dollars but human networks. Whenever we have networks we can get what we need without depending entirely on dollars. And every community has varied networks–business, neighborhood, professional, municipal, civic, religious, hobby, athletic, social, artistic, political, academic, financial, and family.
Such groups can combine to provide the trust that backs money. Local credit systems put networks to work, and to play.
By contrast with global markets, our hometown marketplaces are real places where we become friends, lovers, and political allies. So local cash is real money, backed by real people and tools. National money is funny money, backed by speculation and trillions of debt.
Times were tough back when Ithaca HOURS began. We called them the Great Recession. But times are even tougher now. Were facing not merely a Greater Recession but the Deep Squeeze: permanent decline as fossil fuels and industrial minerals deplete.
So we need a new generation of local currencies, led by new generations who are dedicated to ecology and social justice. With these well employ everyone, to build beautiful and creative cities balanced with nature.
Paul Glover is founder of 18 grassrooots organizations and campaigns, a former professor of urban studies at Temple University, and author of six books. In 1978 he walked entirely on foot from Boston to San Diego and in 2003 was asked by the Green Party to stand as a presidential primary candidate.