Electronic money does not make the World go round

Last week I wrote about the Chancellor’s autumn statement and I tried to express the anger I felt about the continual pursuit of austerity by this government.

There are voices speaking out against it in ever increasing numbers, Russell Brand being simply one of the better known in the UK at least.   I am a small voice in the multitude but I’m in good company not only famous comedians but also heavyweight fiscal institutions are lending their voices to the argument against further cuts.  May be, just maybe, the whole thing will blow up in the government’s face and an opportunity will be seized by bankrupt local authorities, struggling families and radical activists who want an end to the corruption and greed that is free market capitalism.

My friend John Rogers has for many years been engaged in the development of and the economic theories behind alternative local currencies.  The truth is that much of the problems we are suffering are the direct result of the Banking industry’s creation of and speculation in imaginary money to generate inflated profits and massive bonuses.   Local currencies return money to its original function as a medium of exchange rather than a commodity in which you can speculate and thereby cause economic instability.

Local currencies also keep wealth circulating in the local area since they are not backed by the national government then they cannot be used outside the area.  Multi-national business cannot, therefore, send their money off to whatever tax haven the have located their head office in to avoid paying their taxes. Needless to say this type of business sees no benefit in participating in local currency areas!

Local currencies are an interesting idea and I’ll be exploring it further in future blogs.  In the meantime for anyone who wants an introduction to the subject John blogs on the subject and I recommend a read of his recent posts  http://valueforpeople.co.uk/spark-blog/

 

2 thoughts on “Electronic money does not make the World go round

  1. John Rogers

    Many thanks for pointing people in my direction, Annette!

    Annette and I have both ‘got the T shirt’ with local currencies as for many years she struggled with the arcane workings of mutual credit accounting on Excel and Access software when we were both involved in a Local Exchange Trading System in Wales. That is where I cut my teeth with the practical reality of trying to get a small local currency system working. One of the most important lessons I learned was that small scale just doesn’t cut it with local currencies. People may as well just help each other and forget about recording trades, which is what many end up doing.

    That is why these days I am focussed on working with local authorities like Hull City Council to craft systems that include many thousands of people with a broad mix of offers that will give the currency wings.

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    1. adegrandis Post author

      I think one of the things we both learnt about those early days of local currencies is that you need all of the four elements that you talk about in the MAP (individuals, businesses, community groups and local government agencies) to be part of the system otherwise as you say it becomes a way of organising an indirect barter system between individuals – this is useful and valuable because it builds community connections but it doesn’t tackle the bigger issues and unfortunately has a tendency to become the preserve of people who are not in poverty and who have time and resources to spare (aka middle class!) whereas I remember that when we sat around in the back room of the café and in our various houses plotting and starting the system up we really wanted it to be a vehicle for social change and economic regeneration in the wake of the recession of the early 1990’s – and if we thought that one was bad it pales into insignificance compared to what we are going through now – still those early LETS systems showed what could be done.

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