A few Questions on Local Currencies
I posted something recently about the Baltimore B-Note, a local currency being unveiled next month for use in local businesses in “the city that reads”. After getting some questions here and elsewhere and having a few of my own, I boiled them down to three brief questions, which Jeff Dicken, Executive Director of the Baltimore Green Currency Association, was kind enough to answer. So, here’s a bit more on the B-Note:
His first short answer to my questions: Thanks for your questions. In a nutshell, yes, yes, and yes. 🙂
Rufus: A few of us were wondering how alternate currencies steer clear of trouble with the feds. My guess is they’d be okay so long as they’re not metal coins or look like federal bills, but I assume you know more about this.
Dicken: (Yes) The law prohibits the minting of coins and anything that looks similar to the dollar, so we’re in the clear legally.
Rufus: How do local currencies boost the local economy? I’ve seen reports showing they do, but as they’re usually pegged to the dollar, I’m not sure I understand how it works. Is it that they’re accepted by local businesses but not by the big box stores?
Dicken: In the short term, while we’re pegged to the dollar, local currency makes people think about where they spend their money and who they are supporting. It does encourage them to avoid large corporate chains in favor of small merchants, and by doing this, the value of the goods and services produced by the community stays much more in the community, boosting local wealth. In time, it leads to the filling-in of local supply chains, which creates local jobs and also reduces carbon emissions tied to the things that are locally consumed or purchased. In the long term, we are exploring ways of decoupling from the dollar by tieing the value to a basket of basic materials or the value of local services themselves.
Rufus: It seems, to me at least, that localism is partly a response to the collapse of the local social sphere over the last few decades. Can local currencies foster the growth of society?
Dicken: I see the current localization and Transition Towns movement as a response to two things: the price of oil threatening to make the cost of worldwide shipping prohibitive, and the failure of large corporations and the banking industry to take human needs into account as their focus has increasingly been on profits and the extraction of the wealth of society onto their balance sheets. Local currencies are not produced as debt, do not pay interest to corporate banks, and give communities real money that is solely to perform its original function: to enable local commerce. We have a pressing need to localize as many societal structures as possible, for the benefit of people first. We’ve built them before, more than once, and we’re now building them again. The challenge is to educate people enough that they see beyond the current paradigm and decide to help us in this effort.
Thanks again to Mr. Dicken for giving his time and responding to my questions.