Local currencies really can buy happiness

From IPS

ATLANTA, Georgia, May 30 (IPS/IFEJ) – In the face of an economic system which seems to be premised on environmental harm and profit-driven growth, a handful of communities across the U.S. and the globe have begun experimenting with alternative forms of local currency as a pathway to sustainability.

Local currencies existing today in the U.S. include the Humboldt Community Currency in Eureka, California; Berkshares in the Massachusetts Berkshire region; Bay Bucks in Traverse City, Michigan; Ithaca Hours in Ithaca, New York; Cascadia Hours, Corvalis Hours, and RiverHours in Oregon; Equal Dollars in Philadelphia, Pennsylvania; and Madison Hours in Madison, Wisconsin, according to the E. F. Schumacher Society, which runs Berkshares.

Canadian community currencies are located in Calgary, Alberta; Salt Spring Island, British Columbia; Tamworth, Toronto and the Madawaska Valley, both in Ontario, which is promoting a “usury-free dollar”.

There are also community currencies in Tlaxpana, Mexico; and East Sussex and Devon, England; as well as a regional currency based in Basel, Switzerland, which can also be exchanged in parts of Germany and France.

What these currencies have in common is that they represent an effort to respond to the pressures of globalisation, like the advent of massive chain stores competing with local merchants.

People in Berkshire can go to one of five participating local banks to trade 95 cents for one Berkshare, at a five percent discount to the dollar. Then, they can spend Berkshares at over 400 participating local stores as a direct replacement for dollars, and thus save 5 cents with every Berkshare they spend.

Even though store owners lose the 5 cents whenever they trade Berkshares back for dollars at a bank – which they have to do to buy something that can’t be produced locally – they are still typically happy with the loyal, local customers they keep instead of losing them to chains like Wal-Mart, Starbucks, and Barnes & Noble.

If You’re Fed Up With All The Corruption, Greed, and Bailouts, Here’s Something You Can Do About It Locally

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From DAVE SMITH
Ukiah

We don’t have to march or protest. We don’t have to write letters to our congresspersons and President. We don’t have to fire all the President’s men.

We have it within our power locally, and only locally, to start dealing with this mess by stepping aside from the economic systems that have created it.

Are your credit/debit card banks relentlessly raising your fees and charging you usury interest? Start using local money instead. It will save you money, and eliminating the bank fees locally-owned businesses have to pay when you use plastic will lower their costs and lower their prices.

Local money cleans up filthy lucre by jilting the banks and investors who have used our money to build pyramid schemes of debt and ponzi schemes of greed. Local money stays home where it belongs instead of lining the bank accounts of billionaires in Arkansas.

Local money, used face-to-face and hand-to-hand, takes back something valuable we have lost: more control over our own local economy.

For locally-owned businesses, creating and exchanging local money is the cheapest and most effective local advertising ever created because it is carried around in our pockets and is passed around the community from neighbor to neighbor, business to business, as a constant reminder to Buy Local.

Local money has its own built-in insurance. It insures the health and wealth of our own communities, and the more it is used, the more community value and sustainability is built.

Local money is backed by the full faith and trust in our community; by the inventory you see through the windows of our merchants; and by the skills in the hands and hearts of our farmers and restaurateurs.
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Villagers in Thailand create their own money

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From the Wall Street Journal

SANTI SUK, Thailand — One way to beat the world’s credit crisis: Start printing your own money.

The villagers of Santi Suk began creating their own cash here on the sun-bleached plains of northern Thailand following Asia’s financial crisis a decade ago.

Decorating their money with children’s sketches of water buffaloes and Buddhist temples, the villagers conceived it as a do-it-yourself attempt to protect themselves from the whiplash of vast outflows of speculative money which undermined local currencies and threw Thailand — and much of Asia — into recession in 1997-98.

At the time, some villagers faced questioning before Thailand’s central bank and were accused by local government officials of plotting a secessionist revolt.

Now, with Thailand’s economy slowing sharply, the DIY cash is beginning to flow freely again.

“We need our own money more than ever now,” says Phra Supajarawat, the wiry, orange-robed abbot of the local Buddhist monastery, who doubles as a “governor” of Santi Suk’s tiny, one-room bank. “Things are turning bad in Thailand and people need something they can believe in,” he says.

Homemade currencies, sometimes known as community or complementary currencies, have a habit of popping up during economic crises. Some towns in the U.S., Canada and Germany introduced their own scrip during the Great Depression. Similar schemes have emerged more recently in Japan, Argentina and Britain.

Keep reading at Wall Street Journal→
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Another Local Currency Launch in Britain (with video)

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From Transition Culture
Brixton Pound Promo Video Below

David Boyle’s speech at the launch of the Brixton Pound

One of my first experiences of currencies along the lines of the Brixton pound was in Ithaca in upstate New York, where they have had an amazing printed currency for the last 15 years. You can get loans in it. The biggest loan was for $36,000. Not bad for a local currency. Some of the notes are printed on paper made from Angora rabbit fur, which is an innovative solution to the problem of counterfeiting which has not yet struck the Bank of England. But I met a man there who had been mugged in Manhattan. The mugger searched through his wallet and said, hey what are these?. He brandished a pile of Ithaca notes.

My friend explained that they were a way to keep local economies moving, and the mugger was fascinated. Wow, he said. You’re right about the world: money doesn’t work for people like us, does it. And of course it doesn’t work very well. It works beautifully for a very few, for whom it is endlessly elastic and flexible and forgiving. When Robert Maxwell fell off his yacht, he owed twice as much as Zimbabwe. But he had a yacht.

For the rest of us, it is very concrete. We have to pay what little we borrow back according to the rules. Because otherwise, well its moral jeopardy, isn’t it. We might learn bad habits. We might get perverted somehow from the straight and narrow. Then there wouldn’t be enough to bail out Citibank again! But then Americans, it seems to me, understand these things better than we do. Their new kinds of money caused the War of Independence in the first place. Benjamin Franklin with his printing machine. They had 5,000 depression currencies in the 1930s which luterally kept people alive through the Great Depression. Some of them were made of wood, which is a bit bizarre.[!!]

The Stroud Pound Hits the Streets in England

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From Rob Hopkins
Transition Culture

This weekend saw the launch of the Stroud Pound. Four denominations have been published, and over at Josef Coates-Davis’s blog, he tells the story of the design of the notes.

“The notes, designed by local artist Ronan Schoemaker and produced by local currency collector Steve Charlwood, are like miniature histories of the economic and cultural life of the Five Valleys. The most prominent local celebrity to feature is Laurie Lee, author of Cider with Rosie, who was born in Stroud and is buried in the Slad Valley. Local wildlife is represented by the rare Adonis Blue butterfly found on Minchinhampton Common. Stroud’s economic heritage is commemorated by the teazle itself, while the lawnmower, invented in Stroud, the green felt cloth that is still made in the town and Thomas the Tank Engine also feature”.

The launch has generated a fair bit of coverage. The Telegraph focused on the fact that Laurie Lee (author of ‘Cider with Rosie’) features on one of the notes, and here is a piece from the local paper. Local councillor, Philip Booth, on his excellent site Ruscombe Green, discusses Why We Need the Stroud Pound. The Stroud Pound is the work of the Stroud Pound Co-op Ltd which in turn, grew out of Transition Stroud. You can read their take on it here. They state that the reasons for the currency are;

• Retain more locally created economic values within the locality and prevent leakage into the global economy, as happens with sterling exchanges;
• Increase and sustain local economic activity and help insulate Stroud’s economy from the worst effects of Recession;
• Increase trade and support the creation of more jobs
• Help consumers identify which businesses support the local economy.
• (Reduce the length of supply chains for local consumers;)
• Stimulate greater local production

Keep reading at Transition Culture→

Food Backed Local Money

Mendo Food Futures Credits→

Create Your Own Currency

“Money,” wrote Jamais Cascio, “is the tangible manifestation of an agreement between you and other people that the oddly-colored piece of paper in your hands has value.”

But what’s truly valuable is not those units of currency, so much as the units of time they represent to those who earn and spend them. Two women from Ashland, Ore., who follow this philosophy have created a way to turn units of time into currency that can be directly traded and tracked through their online system OurNexChange. This “community currency” allows local residents to buy goods and services without exchanging any money.

Continue reading Create Your Own Currency
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Locabucks: Are local currencies the way to escape the liquidity trap?

Article here

Excerpt:

On July 5th 1932, in the middle of the Great Depression, the Austrian town of Wörgl made economic history by introducing a remarkable complimentary currency. Wörgl was in trouble, and was prepared to try anything. Of its population of 4,500, a total of 1,500 people were without a job, and 200 families were penniless.

The mayor, Michael Unterguggenberger, had a long list of projects he wanted to accomplish, but there was hardly any money with which to carry them out. These included repaving the roads, streetlighting, extending water distribution across the whole town, and planting trees along the streets.

Rather than spending the 40,000 Austrian schillings in the town’s coffers to start these projects off, he deposited them in a local savings bank as a guarantee to back the issue of a type of complimentary currency known as ’stamp scrip’. This requires a monthly stamp to be stuck on all the circulating notes for them to remain valid, and in Wörgl, the stamp amounted 1% of the each note’s value. The money raised was used to run a soup kitchen that fed 220 families.

Because nobody wanted to pay what was effectively a hoarding fee [technically known as 'demurrage' and often referred to as "negative interest"], everyone receiving the notes would spend them as fast as possible. The 40,000 schilling deposit allowed anyone to exchange scrip for 98 per cent of its value in schillings. This offer was rarely taken up though.

Of all the business in town, only the railway station and the post office refused to accept the local money. When people ran out of spending ideas, they would pay their taxes early using scrip, resulting in a huge increase in town revenues. Over the 13-month period the project ran, the council not only carried out all the intended works projects, but also built new houses, a reservoir, a ski jump, and a bridge. The people also used scrip to replant forests, in anticipation of the future cashflow they would receive from the trees.

The key to its success was the fast circulation of scrip within the local economy, 14 times higher than the schilling. This in turn increased trade, creating extra employment. At the time of the project, Wörgl was the only Austrian town to achieve full employment.

Six neighbouring villages copied the system successfully. The French Prime Minister, Eduoard Dalladier, made a special visit to see the ‘miracle of Wörgl’. In January 1933, the project was replicated in the neighbouring city of Kirchbuhl, and in June 1933, Unterguggenburger addressed a meeting with representatives from 170 different towns and villages. Two hundred Austrian townships were interested in adopting the idea.

Unterguggenberger was opposed to both communism and fascism, championing instead what he referred to as ‘economic freedom’. Therefore, it was deeply ironic that the Wörgl experiment was first branded ‘craziness’ by the monetary authorities, then a Communist idea, and some years later as a fascist one.
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Resilient Community Scrip

http://globalguerrillas.typepad.com/globalguerrillas/2008/06/the-resilient-c.html

Dave

Deli Dollars and Farm Preserve Notes (video)

They Print Their Own Money In Totnes

They don’t just shop local in Totnes – they have their very own currency

The notes feature a picture of Totnes instead of the Queen’s head © Richard Lapp

“The idea is to keep money in the area, thereby retaining wealth within the community. If you look at the places with economic problems it is because the wealth is leaking out of the neighbourhood.”

If you were to nip down to Devon’s Totnes market on a Saturday looking to buy some spelt flour pancakes, crêpes or falafels, then you might just encounter Lou Brown, who is a remarkably fine cook. But she has another, non-culinary distinction. Unlike most businesses in the country, Brown does not deal in currency with a picture of the Queen’s head on it. No, instead, her change features an image much closer to home. The town where she lives.

Brown, along with thousands of her fellow residents in this colourful south-west retreat, uses Totnes pounds: notes printed and traded locally (and decorated with a sepia depiction of the town’s main thoroughfare). The idea for the pound – used in 70 businesses round these parts – was introduced a year ago, to promote links between local businesses while reducing reliance on big business. The aim is to keep money circulating within the town’s local economy. If people are encouraged to buy local produce, the thinking goes, it will help to cut down on food – and trade – miles and also help to strengthen community relations and links with local producers.

The concept has proved so popular that a cluster of other towns around the country are initiating copycat schemes. Indeed, it is hoped that similar projects can be launched in the Welsh towns of Lampeter, Llandeilo and Llandovery this year.

Brown says: “People are so positive about the currency. I think lots of people feel supportive towards helping local producers and farmers, especially with the growing awareness of the effects of transport on the climate. Some people ask for them in their change, especially when I put up my sign. They are certainly disappointed when they can’t get hold of them.”

Totnes radiates out from a bustling main road, Fore Street, peppered by cute boutiques run by what some locals refer to as “burnt-out people from the city who can afford to buy a shop and not sell anything”. A legion of media types from London have second homes there and property prices are soaring. It follows that if anywhere could afford to experiment, it would be here. Its 8,500 residents have a reputation for middle-class, alternative lifestyles. Time magazine has dubbed it “the capital of New Age chic”, while Highlife, the British Airways magazine, thinks it is one of the 10 places to be.

The Totnes pound was pioneered by a group of local environmentalists led by Rob Hopkins and Naresh Giangrande. They set up a system in which £1 coins are exchanged for 1TP at one of four “change” points around Totnes. There are now 6,000 Totnes pounds in circulation and plans to introduce further denominations.

The idea was partly based on a US model. “BerkShares” were launched in the Southern Berkshire region of Massachusetts in 2006. They were a roaring success – some 1.43 million “BerkShares” worth $1.29m (£650,000) were issued in the scheme’s first 17 months and there are now more than 300 businesses accepting them. BerkShares’ organisers say: “The purpose of a local currency is to function on a local scale the same way that national currencies have functioned on a national scale – building the local economy by maximising circulation of trade within a defined region.

“The currency distinguishes the local businesses that accept the currency from those that do not, building stronger relationships and a greater affinity between the business community and the locals. The people who choose to use the currency make a conscious commitment to buy local first. They are taking personal responsibility for the health and well-being of their community by laying the foundation of a thriving local economy.”

As Noel Longhurst, one of the group which developed and manages the Totnes pound project explains: “The idea is to keep money in the area, thereby retaining wealth within the community. If you look at the places with economic problems it is because the wealth is leaking out of the neighbourhood.”

His zeal is matched by Alan Langmaid, the administrator of the museum in Totnes, although he admits “a lot do end up under fridge magnets”. There are, however, some notable detractors. “We took Totnes pounds for only a year but then nobody wanted them back in change,” says Ray Johnson, the owner of Annie’s Fruit Shop, located at the end of the town’s main thoroughfare. “That’s basically the reason we stopped using them. At the end of each day we counted up 60 or 70 Totnes pounds in our till; but you could only spend them in other shops that accepted them.”

Hoping such cases would be in the minority, Hopkins and Giangrande administrate the currency through the town’s “transition” organisation, created in September 2006. Following in the footsteps of a similar scheme in Ireland, such “transition” areas aim to stave off the twin threats of climate change and “peak oil”. The latter refers to when the maximum rate of world petroleum production is reached (after which point production declines and prices rise sharply).

In addition to the pound, the transition town organisation offers people advice at “oil vulnerability auditing workshops” on how their businesses can wean themselves off the black stuff; and the group is in talks with the council over “edible landscapes” – herb gardens instead of ornamental verges and bushes. They have recently secured some allotments for the green-fingered, and are promoting the use of energy-saving light bulbs. Similar ideas are in the pipeline: they are telling the town’s inhabitants to switch over to locally generated power, and are promoting the use of solar water heaters.

One of the many to paddle up this river of change is Tom Morris, the owner of Totnes Kayaks. Outdoor pursuits such as kayaking are popular in Devon, and needless to say, modern kayaks, which are made mostly from plastic, could be a major casualty of dwindling fossil fuel supplies. “We are looking at alternatives the whole time because the raw material and transport costs are simply not sustainable,” he says. By way of example, he gestures to some smaller “Jackson” kayaks which use less plastic. “Shipping any kayak from the States, which is where many of the manufacturers are based, is costly. We are looking into sourcing these locally, by speaking to a couple of businesses who have set up plants in the UK. And because the shipping costs are lower, prices are lower for our customers.” He explains that such change is partly the result of work done by “auditors” from the transition town organisation. They have been through everything in his shop and worked out how he can save money – and energy.

“Wales is a hotbed of activity, as is Cornwall,” says Hopkins. “We are now up to 50 formal transition projects and more than 700 ‘mullers’, those at an earlier stage of the process – with New Zealand and Australia being very active. A man from Japan was over here recently, and he has now gone back to start transition projects there. And we are busily getting our literature translated into a number of languages, including Welsh and Japanese.

“The viral nature of the growth of the transition movement has taken us all by surprise. We have gone from one transition project to there being 50 formal ones and more than 700 at the earlier stages just by word of mouth and the internet. We still have no film, nor, until very recently, did we have a book. I think it shows that people are hungry for positive solutions which engage their creativity.

“The transition movement has been described as being ‘more like a party than a protest march’, and that feeling of being part of something playful and solutions-focused has undoubtedly been a part of its success.”

If he has his way, the ring of local currencies pouring out of tills will soon be heard up and down the country.

Keeping it local: how alternative cash schemes work

* The Totnes pound is worth £1. Each unit of local currency is legally backed by an equivalent in official currency, so traders and customers can confidently use them, knowing that they have a real value.

* Since local currencies are only accepted at local businesses, their use encourages the purchase of locally produced goods and services. This helps to prevent money “leaking” out of the area’s economy.

* By helping to give a boost to local producers, the scheme cuts down on food miles, which is better for the environment.

* Another form of local trading is Lets (local exchange trading system). In this scheme, people exchange goods and services for a system of credits, so bypassing the formal economy.

* Lets is not bartering. Locals set up a club and can trade in goods and services using Lets “points”. These points can be used to buy from any other member. Thus, a parallel economy is created.

( There are thousands of Lets schemes around the world.

The Velocity of Money

From: The Automatic Earth

Stoneleigh: The velocity of money is an important concept underpinning the liquidity trap we are entering. John Mauldin has a good explanation as to how it interacts with the money supply in this article, and I suggest that everyone reads the whole piece.

What is happening is something we have touched on here before – hoarding. The hoarding mentality is a psychological shift in response to perceived shortage. Hoarding represents a lack a trust that the supply of something will be adequate, or the price reasonable, in the future. The response is to stock up, even though this compounds the problem for everyone. People are currently hoarding food in many places, which acts to drive the price up further due to the increase in demand (see comment below with accompanying article).

Similarly, even if the money supply is increasing, a lack of trust results in banks hoarding cash, which sends the price of cash (in the form of interest rates on inter-bank lending) sharply higher and the availability lower. This decrease in the velocity of money makes it increasingly difficult to keep the market supplied, even though central banks are intervening in more and more aggressive ways. Combined with the on-going destruction of credit (which has acted as a money equivalent during the long expansion), the failure of the securitization model (which has acted to increase the velocity of money), the need for banks to rebuild reserves and the need for individuals and businesses to both cut spending and build savings, the liquidity trap becomes inevitable.

The Velocity Of Money

Now, let’s introduce the concept of velocity of money. Basically, this is speaking of the average frequency with which a unit of money is spent. Let’s assume a very small economy of just you and me, which has a money supply of $100. I have the $100 and spend it to buy $100 of flowers from you. You in turn spend $100 to buy books from me. We have created $200 of our “gross domestic product” from a money supply of just $100. If we do that transaction every month, we would have $2400 of “GDP” from our $100 monetary base.

So, what that means is that gross domestic product is a function of not just the money supply but how fast the money supply moves through the economy. Stated as an equation, it is P=MV, where P is the Nominal Gross Domestic Product (not inflation adjusted here), M is the money supply and V is the velocity of money. You can solve for V by dividing P by M.

Now, let’s complicate our illustration just a bit, but not too much at first. This is very basic, and for those of you who will complain that I am being too simple, wait a few pages, please. Let’s assume an island economy with ten businesses and a money supply of $1,000,000. If each business does approximately $100,000 of business a quarter, then the Gross Domestic Product for the island would be $4,000,000 (4 times the $1,000,000 quarterly production). The velocity of money in that economy is 4.

But what if our businesses got more productive? We introduce all sorts of interesting financial instruments, banking, new production capacity, computers, etc., and now everyone is doing $100,000 per month. Now our GDP is $12,000,000 and the velocity of money is 12. But we have not increased the money supply. Again, we assume that all businesses are static. They buy and sell the same amount every month. There are no winners and losers as of yet.

Now let’s complicate matters. Two of the kids of the owners of the businesses decide to go into business for themselves. Having learned from their parents, they immediately become successful and start doing $100,000 a month themselves. GDP potentially goes to $14,000,000. In order for everyone to stay at the same level of gross income, the velocity of money must increase to 14.

Now, this is important. If the velocity of money does not increase, that means that (in our simple island world) on average each business is now going to buy and sell less each month. Remember, nominal GDP is money supply times velocity. If velocity does not increase, GDP will stay the same. The average business (there are now 12) goes from doing $1,200,000 a year down to $1,000,000.

Each business now is doing around $80,000 per month. Overall production is the same, but divided up among more businesses. For each of the businesses, it feels like a recession. They have fewer dollars so they buy less and prices fall. So, in that world, the local central bank recognizes that the money supply needs to grow at some rate in order to make the demand for money “neutral.”

It is basic supply and demand. If the demand for corn increases, the price will go up. If Congress decides to remove the ethanol subsidy, the demand for corn will go down as will the price. If the central bank increases the money supply too much, you would have too much money chasing too few goods and inflation would manifest its ugly head. (Remember, this is a very simplistic example. We assume static production from each business, running at full capacity.)

Let’s say the central bank doubles the money supply to $2,000,000. If the velocity of money is still 12, then the GDP would grow to $24,000,000. That would be a good thing, wouldn’t it? No, because we only produce 20% more goods from the two new businesses. There is a relationship between production and price. Each business would now sell $200,000 per month or double their previous sales, which they would spend on goods and services which only grew by 20%.

They would start to bid up the price of the goods they want and inflation sets in. Think of the 1970’s. So, our mythical bank decides to boost the money supply by only 20%, which allows the economy to grow and prices to stay the same. Smart. And if only it were that simple.

Let’s assume 10 million businesses, from the size of Exxon down to the local dry cleaners and a population which grows by 1% a year. Hundreds of thousands of new businesses are being started every month and another hundred thousand fail. Productivity over time increases, so that we are producing more “stuff” with fewer costly resources.

Now, there is no exact way to determine the right size of the money supply. It definitely needs to grow each year by at least the growth in the size of the economy, new population and productivity or deflation will appear. But if money supply grows too much then you would have inflation….

….Now, why is the velocity of money slowing down? Notice the real rise in V from 1990 through about 1997. Growth in M2 (see the above chart) was falling during most of that period, yet the economy was growing. That means that velocity had to rise faster than normal. Why? Primarily because of the financial innovations introduced in the early 90’s like securitizations, CDOs, etc. It is financial innovation that spurs above trend growth in velocity.

And now we are watching the Great Unwind of financial innovations, as they went to excess and caused a credit crisis. In principle, a CDO or subprime asset backed security should be a good thing. And in the beginning they were. But then standards got loose, greed kicked in and Wall Street began to game the system. End of game.

What drove velocity to new highs is no longer part of the equation. Its absence is slowing things down. If the money supply did not rise significantly to offset that slowdown in velocity the economy would already be in a much deeper recession.

For more information go to: http://www.frontlinethoughts.com/learnmore

Transition Conference In England

My Closing Address to the 2008 Transition Network Conference – Rob Hopkins

At the end of the Transition Network conference, I was asked to give a closing address to pull the strands of the weekend together. Adrienne Campbell very kindly typed it up, and so here it is, and thanks again to Mike Grenville for the photos.

Last year when we met at Nailsworth, we were coming together to say, “hey isn’t it great, this thing that we’re doing… what ever it is”, we were very much forming. This event has a much stronger idea of what we’re doing, where we’re going and has been starting to look at putting the next steps in place for how we continue.

Any gathering like this can only scratch the surface but at the same time it can go very, very deep. It scratched the surface in that we had 30 workshops to choose from and only managed to go to three, and out of the many, many Open Space sessions only a few of them were able to benefit from your knowledge, from the brilliance that you brought along to this event. Yet it’s been deep in that we’ve learned together, shared ideas and inspiration, played football, eaten and drunk together, sung together and sat in silence together, so it’s been a deep experience for us too.

Although the film (The Age of Stupid) was an intense experience for some people, what I often like to think of is a famous Buddhist text called A Guide to the Bodhisattva’s Way of Life by Shantideva, which is all about living your life as a service to others. One of the really beautiful analogies in it is about peacocks who live in a grove of poisonous trees that drop poisonous berries, but these peacocks are able to eat the berries and transform them into really beautiful plumage and feathers.

I think in a sense that one of the things that is quite distinctive to the Transition movement is that we are able to take these twin issues of peak oil and climate change, and instead of them being something that weighs us down, we are actually able to turn them into something else, to transmute them.

I was at Findhorn recently, and Joanna Macy was speaking there. A few people have mentioned Joanna Macy this weekend and I had waited 10 years to do a workshop with her. It was really quite extraordinary. The thing that she kept coming back to all the time was motivation and intention, that what we actually do is really quite secondary, it’s the motivation and intention that we do them with that matters the most.

What has really touched me over the few days we’ve spent together has been the motivation and the intention that you’ve come here with. You aren’t involved in this work because you want to become famous. You aren’t involved in this work because you want to become wealthy (laughter) – this work is a very good way to not get tremendously wealthy! You aren’t here because of some sort of dogmatic political agenda you want to drive through.

You’re here because you care, and because you sense that this is the time of the Great Transition, the time of the Great Turning, that it’s now or never and that we are extraordinarily fortunate to be alive at this time, because we can do really, really extraordinary things. (applause)

I think that people will write songs about what we’ve done here this weekend. They’ll probably be terrible songs, but they’ll be sung with great gusto! People will tell stories about the brave and brilliant people here and the amazing things they went off and did afterwards when they got home.

The times we are heading into are times that will throw a lot of things at us. People have talked about the backlashes and the fear, the grief that we will encounter. We will also have to meet our own fear as we do this work. I love this quote, that I put in the back of the conference booklet, by Ambrose Redmoon;

“Courage is not the absence of fear, but rather the judgment that something else is more important than one’s fear. The timid presume it is the lack of fear that allows the brave to act when the timid do not. But to take action when one is not afraid is easy. To refrain when afraid is also easy. To take action regardless of fear is brave.”

It feels to me that if, as we go away from here, we can keep that intention and that motivation really pure and remember that we don’t do this work for ourselves, but that we do it for the people who come after us, then that’s what we need to keep coming back to when we need to fire ourselves up and re-energise ourselves as we do this work.

This is a time when everything is up for grabs. We’re coming into a time when climate change and peak oil are such clear problems, along with all the other converging problems that people have mentioned. So what are the strategies that the government of this country have put forward? They propose that we’ll build 23 new nuclear power stations, we’ll build a new runway at Heathrow Airport, we’ll take the tops off mountains at Merthyr Tydfyll and start open cast coal mining again, and we’ll build biofuel refineries on the coast. All of which are such a complete non-response.

Actually the projects and initiatives that you generate in your towns and your communities and in your Energy Descent Plans are asking the real questions and coming up with the real answers, it is the real work that needs to be done. You’re coming up with answers that actually work and are on a scale with what we’re looking at. You’re producing solutions, not a shopping list for suicide (applause). These are extraordinary times that require extraordinary people, and that is who you are, and that is what you’re doing. It has been a real honour to spend this time around you all.

So where will we be next year when we meet again? I have no idea, and that’s what’s really extraordinary about this. Maybe we’ll have some politicians here. Maybe we’ll have some business leaders here. Maybe we’ll have hundreds of formal Transition projects here, thousands of mullers represented. What’s been extraordinary about this process so far is that we’ve had no idea where it’s going.

In Open Space, we talk about Whoever Comes are the Right People, Whatever Happens is the Only Thing that Could Have Happened, When it Starts It’s Time to Start, and so on. That’s what underpins all of this, so it’s really lovely when it comes together at events like this.

I really struggle sometimes to imagine how enormous this could all become. Sometimes I’m sat with Ben and some email comes into him and he just says ‘Jesus! Such and such has just happened’, and we just sit and go ‘wow’ for a while. As this goes on we have these moments where we go ‘wow’ and sit and look stunned more and more. This is all speeding up, because these times are speeding up and where all of this can go is beyond our imagination. At the end of the day, given all that you know, and all that you’ve done so far, what else would you want to do?

Thank you all so much for coming, all power to your collective elbows and see you next year.

~~

Where Have All The Joiners Gone?

A declaration of dependence

by Bill McKibben

Orion Magazine

CHEAP FOSSIL FUEL has made us what we are. Which is to say: rich, powerful—Look at us! We can make the ice caps melt! The oceans rise! But something else too: cheap fossil fuel has made us the first people on Earth with no need of our neighbors. Think, in the course of an ordinary day, how often you rely on the people who live near you for anything of practical value. Perhaps carpooling your kids to school or soccer. If you live in a rural community, there may be a volunteer fire department, which keeps your insurance affordable. But your food, your fuel, your shelter, your clothes, and your entertainment most likely come from a distance and arrive anonymously at that. A meteorite could fall on your cul-de-sac tomorrow, disappearing your neighbors, and the routines of your daily life wouldn’t change.

Now imagine how different things have been for almost all of human history. Two hundred years ago, if an American wanted to eat a hamburger for dinner, he needed to be able to convince his neighbors to, say, help him build a barn in which to store hay to feed his cows all winter. And to help him harvest his wheat crop. Likely they would have come together to thresh it—there wasn’t a surplus of machinery. A neighbor would have slaughtered the cow and another would have baked the bread, unless it was all done in the family. The same went for what was considered women’s work. Laurel Thatcher Ulrich, in a wonderful article in the journal Feminist Studies, showed that our notion of the self-sufficient farm family was bunk. There was a lot more to do than just berrying or washing or husking or quilting. Say you needed some homespun woolen cloth: there were eleven separate tasks involved, from herding sheep to dressing the fabric, and, as Ulrich noted, “it would have been an extremely unusual family that commanded the tools, skills, and labor to perform all of these steps at home. . . . What was true of wool was also true of flax,” she said, “for a family might grow its own; have it retted, swingled, and hackled by a flax dresser; bring it home for spinning and reeling; send it out to be woven; and then consign it to the bleach fields or dyer for finishing.”

Some of this exchange might have been paid for, much of it bartered, and a lot of it simply unaccounted for, since the reciprocal hand-lending was inevitable. Douglas Harper, in Changing Works, a poignant account of the dairy farms of northern New York, interviews farmers old enough to recall the time when “we would pitch in and go help. Everyone wasn’t so busy then. Oh, they had time or something.” You can read about it in Wendell Berry novels; if you want to still see it in operation, you may need to visit an Amish farm.

That’s because the advent of cheap fossil fuel, and the prosperity, globalization, and specialization it allowed, changed, well, everything for those who went along (which is to say, everyone but the Amish). You could look at almost any profession—baker to banker—but let’s stick with farming. When you depended on horsepower and human labor, you needed help. When you depended on high-powered machinery, you simply didn’t. Once you had a big combine, you could do it yourself. As one farmer told Harper, all of a sudden “there was no need, no call, really, to go see them. . . . I don’t think anyone has anything against anyone—you just don’t have any need to be there.” And all those machines let farms grow steadily bigger, which had as its logical result a far greater physical distance between the farm families who remained.

We could count this as simply the way of the world except for two problems.

One, of course, is that the era of cheap fossil fuel may be coming to an end, either because we run out or because we take global warming seriously and seriously cut back. Either way, the massive, invisible, industrialized methods we’ve come to rely on for feeding and clothing and fueling our lives may start to break down.

And the other problem is that we may break down. We weren’t designed to be this distant from our neighbors—we descend from apes who spend most of the day grooming each other for the practical purpose of removing lice and for the even more practical purpose of building the deep bonds that give their lives security and meaning. The economic life of Homo sapiens has always been about that kind of contact—until now, until us. Research has shown that when we live on car-filled streets, our number of close friends drops by half. We eat half the meals we used to with friends, family, neighbors. Forget about the flax-swingler; our clothes come through the ether from the mysterious geography of Lands’ End. We don’t need each other anymore, and that’s the saddest thing we’ve done—sadder even than the scourge of climate change, which at least is anonymous and impersonal.

Once we’ve started down this road, it’s hard to turn back; being a neighbor is a skill like any other, and it’s a skill we’ve increasingly lost as we’ve turned into hyperindividuals. Say you need the proverbial cup of sugar: do you turn to the neighbor or turn the car on and drive to the store? One survey found that three-quarters of Americans didn’t have a real relationship with the folks who lived next door. (New upscale houses now routinely come with dual master bedrooms, since even the talent for being a mate seems to be dwindling.) The big question for this century may turn out to be how fast we can relearn the skill of neighborliness.

Take farming again. The local food movement is helping to build demand for small farms. If it continues, we may someday reach the point where we once again have more farmers than prisoners in America—which will be a good thing, if we’re hoping to grow our food with less oil. But if that’s going to happen, it will take more than farmers’ markets—it will take farming communities, with enough small growers in the neighborhood to teach each other what needs doing. One of the best young farmers in my corner of Vermont, Spencer Blackwell, recently graduated from several seasons of growing grain and beans on the Intervale land in Burlington—a kind of incubator for young farmers with a dozen little start-up farms in any given year. “Maybe it was a little bit what it was like in the 1800s, when every other person was a farmer,” he says. “You need to know something—what’s the best time to plant oats as a winter cover crop—and there’s someone right around to tell you.” You can borrow equipment too, which is helpful because, as Blackwell points out, almost everything at the implement dealer is designed for mammoth farms. “I don’t want to grow a thousand acres of broccoli—I want to grow five acres,” he says.

For the rest of us, who aren’t planning to actually till the soil ourselves, relearning neighborliness means joining a CSA or going to the farmers’ market (where shoppers have ten times as many conversations per visit as they do at the Shop ‘n Save).

It means putting solar panels on our roofs and tying them into the grid so that our neighbors can cool their beer with the sunlight that falls on our shingles—and, of course, it means buying that beer from the local brewery. It means buying CDs when the artist is selling them after a concert, and listening to your local public radio station instead of the XM satellite-from-nowhere. It means not just supporting the idea of mass transit but getting on the darned bus sometimes.

It means embracing nonindependence—which to us may seem un-American, but in fact it is just the opposite. Tocqueville, in the greatest clichè of American political science history, called us a nation of joiners. We’ve gotten away from that—become a nation of drive-around-by-ourselfers. But in a world that seems likely to grow a little tougher all around, with weird weather, rising prices, and falling profits, a neighbor is what you’ll need most.
~~

Easy Money

Letter to the Editors sent today:

Easy Money

Since the Fed is printing so much money these days and handing it out willy-nilly to whomever comes a-begging, why not just print some of our own?

I’m serious.

Their answer to “tight money” and the “credit crunch” is to flood “the system” with billions. In the meantime, what do we do while they are trying to make it all work out? Wait and see? What if it doesn’t work? Wait for the next election? Do you think that’s going to make it all better? Many feel that the great depression was caused by not getting enough money into circulation. Is that what is going to happen again?

In the meantime, unemployment is rising, home values are crashing (check yours on Zillow.com), what they used to call “bread lines” are growing, food prices and food stamp use are exploding upwards, people are rioting all over the world because they can no longer afford to eat.

Shall we just keep craning our necks to see if “they” have cleaned up the wreck so we can get on with our lives? Or are there ways to create a measure of economic independence locally to help insulate ourselves from all this, now and into the future?

The two most important things we can do locally is get more local control of our food and of our money. The farmers’ markets are gearing up for another season, and local membership farms (CSAs) are soliciting members. The co-op is buying more and more of their produce from local and regional organic farmers. Growing and buying local organic food is the single most important thing you can do right now, starting today, to help insure a more secure tomorrow for us and our children.

And the other most important thing is creating and using our own local currency. Printing and using local money is legal, and at times in our national history has saved communities from the ravages of bad economic times. From Salt Spring Island to Calgary to Ithaca to the Berkshires, local money is helping local communities keep their money in their own communities, guarding against the uncertainty of global finance.

Please go to MendoMoola.org. Hurry.

Dave Smith
Ukiah

Local Past Attempts

From Dave Smith

Yes, we are well aware of past attempts in our county to do this. There are many reasons why local currency projects fail, here and other places, some of them outlined in the linked articles provided on this site.

Here are a few of the reasons:

- Burn-out of the volunteer organizers

- Key businesses don’t want to play

- Effort is confined to a political segment of the community, which is not enough people to make it work, or turns off other segments who then don’t want to play

- Organizers not savvy enough in how to promote it

- Fear that local money is not backed up with real value and won’t be redeemed for real money if things fall apart

- Money is traded as hours, rather than currency. Hours systems work and have their own place in a community, but they are not to be confused with printed currency

- Timing of the effort politically or economically wrong

These problems are anticipated. But we are energized by the successes elsewhere, can learn from their mistakes, and feel that the timing is just about right.
~~

Renewable energy as backing for a community currency

Greetings Blogosphere!

This is my first foray into the wild west of journalism. I’m posting here because I’ve been scheming with Dave Smith about how we can introduce a community currency here in Mendocino County. I’ve been interested in this topic for some time, since college actually, when I saw my first Ithaca Hour, while grabbing a low quality east coast burrito in that quaint college town (Ithaca is lovely, but not a mecca for Mexican food).

Now residing in Mendocino County and intimately involved with the localization movement the concept of launching a community currency takes on new relevance. We’ve been kicking around ideas of how such a process would work, and a seed that was planted in my brain at the Regional Localization Networking Conference hosted by WELL in Willits several years ago is beginning to germinate. What if we had a currency back by renewable energy generation as opposed to a precious metal or “full faith and credit” as we do now? Could we create a viable currency while providing for the creation of renewable energy in our community. I put this out to the world trusting that there exist people with more experience in this realm who can help guide this plan to a workable model.

Basics of the Plan

• Community members and businesses purchase Community Notes (CN) in exchange for Federal Reserve Notes (FRN) from a non-profit entity. They receive CN on a 1 to 1 basis for FRN.
• The non-profit then uses the FRN to purchase and install Solar Photo-Voltaic (PV) systems on City owned property, which are donated to the City (In our case Ukiah owns its own electric utility).
• The City then benefits by selling the power generated from the PV systems to its customers.
• In exchange for the donated system the City agrees to redeem any notes from the public in exchange for credit against monthly utility bills.

Benifits of the System

• The City would benefit by having it’s own source of energy generation which would be immune to increased cost of generation likely elsewhere in the electricity market.
• City residents would benefit by having a renewable and consistent source of electricity supply and would also be insulated against rising energy costs.
• Individuals and businesses using CN would be willing to accept them knowing they could be used to pay for a known expense if they needed to be redeemed.
• The hope would be that many of the CN would never be redeemed, as some would leave the area as souveners, while others would become permanent fixtures on the refrigerators (now powered in part by PV systems) of community members, and others would remain in circulation.
• If a large number of CN remained unredeemed after a period of years it would encourage the city to support additional issuings of the currency.

Potential challenges to the system:

-The payback period of the solar system is going to be several years. For example a if the initial release of CN was for $100,000 the a PV system that could be purchased for such an amount would likely produce only $10,000 worth of electricity per year (rough number here that I’m working on calculating more precisely). If this was the case there could be a potential shortfall for the city if a majority of CN were redeemed before the system had generated $100,000 dollars worth of electricity.

Potential solutions: The City purchases a bond to cover the entire amount of the initial issue that would be paid back over time using revenue generated by the PV system. Create a currency with a specific redemption window. For example a note issued in year 1 could be redeemed for full value (used to pay a utility bill, or exchanged for a newer issue) in years 3-5, which a discount occurring in year 6-8, and totally unredeemable thereafter. This would ensure that notes wouldn’t be redeemed during the first several years of the program.

-A successful CN system encourages people to spend their notes, increasing the rate of turn over, and thus economic activity. A note that is redeemable for a utility bill could end up being used a form of savings rather than a medium for exchange.

Potential solutions: Education outreach that would stress the importance of flow through for maximum benifit to the community. A redemption window here would accomplish the purpose of keeping CN from becoming a savings mechanism as they would loose value if not redeemed in a specific period.

-Notes would only be redeemable by people receiving a city utility bill, which would limit their use to people living in the City.

Potential solutions: Create an online exchange where people with excess CN could find buyers within the city to purchase the notes. Eventually this could also be a driving force in the creation of a County Owned utility, analogous to the Trinity County Public Utility District or the attempts by San Francisco to become its own utility.

Looking for your input

Please provide your feedback to this idea. I trust that critical analysis will lead to a system that is workable and benifical for our community. I look forward to your comments.

In Sun We Trust,

Cliff Paulin