New Money

Do you work because you like your job, or do you work to make money? Either way, money is handy, no point in denying it. Food, shelter, clothing and fun usually come with a price tag and a national currency is the only way to pay, legally anyhow.

Right?

No, I didn’t try to pay for my last fine dining experience by a tour in the dish-pit. I don’t suggest you try it either; your date will not be impressed by your work ethic and scrubby skills. You should instead exhibit (as is the norm), the wallet ethic and skill in unloading dollars, leaving in good standing with the establishment, and possibly your date.

Right?

Turns out “not necessarily” is the correct answer. And no, it doesn’t involve anything shady, but I think you’ll share my initial incredulousness. I was intrigued to discover there are some communities wherein you can pay for dinner without paying with a national currency in cash, debit or credit form, and use a local currency instead.

Ithaca, a town of 30,000 in upstate New York, features a local currency called the Ithaca Hour. It is only accepted in the area roughly 30 kilometers around town, but that is a good thing because the Ithaca Hour was created to help stimulate and stabilize the local economy. Each Ithaca Hour is worth $10 U.S. dollars or an hour of work, though you are free to charge others as many hours as you want for your time and effort. Ten dollars might not seem like much as a baseline, but if you consider that New York’s minimum wage is $7.25, working for an Ithaca Hour could be a raise for people in the lowest income bracket.

Ithaca’s legal alternative currency system has been running since 1991 and works like (and even feels like) cash, but it stays within the community instead of leaving as profits of non-local companies. Around 900 local businesses participate in the program, offering to accept a certain percentage of payment in Ithaca Hours and some businesses pay part of employee wages in Hours, consensually of course.

Local currencies, such as the Ithaca Hour, provide a common means of exchange without being a wealth generator in and of itself. Thus it facilitates exchange and industry without the constraints of the established money system and without its volatility. Also, an exchange of labour isn’t taxable, because there’s no national currency involved, so both parties can save money. Best of all, Ithacans say, the Hour encourages a strong community because it encourages interaction between its members through trade.

As a nation engaged in global enterprise, we are undeniably tied to international markets for the foreseeable future. Is it in our interest, however, to be tied into the global currency market to suffer the vicissitudes of financial fortune? With proper administration, local currencies offer a ready currency supply without the tendency for inflation and the damaging effects it can have on people and communities, especially for the less prosperous of them. As the “buy local” trend continues, and as the global financial market inflates itself into space, I think we may see increased interest in more grounded currencies.

Comments

[Thomas Gibbs]

The Ithica Hour kind've reminded me of Bitcoin, which is an online peer-to-peer currency that doesn't rely on banks. A lot of people use it to buy illegal items because the transactions are anonymous.