LOCAL, NATIONAL AND GLOBAL MONEY IN SUSTAINABLE COMMUNITIES DEVELOPMENT
Saturday, April 28, 2012
Note that rather than using the terminology of sustainable development the terminology of sustainable communities development (SCD) is used here. The latter terminology is preferred to make the point that the SCD model points to the need of development of sustainable communities both in the global North and South while sustainable development (SD) model is mostly geared to SD in the global South as if the global North does not need development and as if the global North and South are not interconnected.
One of the four main elements of sustainable communities according to the Institute of Sustainable Communities in Montpelier, Vermont, USA is economic security. The others being ecological integrity, empowerment and responsibility, and social wellbeing.
Two of the five subcategories in this economic security category are listed as “a diverse and financially viable economic base” and “reinvestment of resources in local economy”. Both these conditions for a sustainable community, be it a city in the North or a village in the South, can be applied to a diverse monetary base, where local, national and global money intertwine.
In Local Money. How to Make it Happen in Your Community Peter North, a geographer and member of the Transition movement, presents in very understandable prose the various expressions of local money: Local Exchange Trade Schemes (LETS), Time Banking, Ithaca Hours, Creditos, Deli Dollars, Berksharess, Totness Pounds, Credit Unions, Community Banks, Local Bonds. One can add to these monetary modalities the contributions of the microcredit movement, particularly those that are not made by commercial institutions that entered the field after Yunus’ original drive.
Local money, particularly the money modality that is owned and managed locally, is able to empower local people to start small businesses which would produce for the local economy. Such economic activity keeps both the monetary and economic resources within the community, strengthening it. A beautiful example is the Self Help Groups in South Africa as described in http://www.sinamandla.org.za) and viewed at http://www.youtube.com/watch?v=MMGekiJLVdk. The example also shows how the presence of a locally owned monetary base contributes to the strengthening of many other good characteristics of a sustainable community.
While most local money modalities are complimentary to the national currency, it is also possible to have national currencies be owned by the public when the state establishes its own bank by pooling its financial resources in such bank rather than depositing them in privately-owned banking systems. This was done, particularly in the 1930s by the Social Credit parties in Canada and New Zealand and by the state of North Dakota in the USA, and which is now being considered in 14 states in the USA according to www.publicbankinginstitute.org.
Unfortunately, global money and its international monetary system are in its infancy. There is no Global Central Bank that could administer a system that not only regulates capital flows, but also be the sole creator of new money and credit. In order for that to happen nations, business and civil society have to come to the realization that without monetary unification the present monetary, financial, economic and commercial systems can not function properly in this highly interconnected world that continues to globalize.
Such awareness could grow if, at the same time, governments, business and civil society would be willing to take serious steps to deal with the climate crisis. In that case they could consider taking a specific tonnage of CO2e per person as a standard for a 21st century international monetary system.
If such carbon-based international monetary system were to come in place where not scarcity and austerity were the norm, but plenitude and monetary freedom, many of the other local and national monetary modalities would change dramatically and the world would be place where humans would change social systems in order to adjust to immutable physical systems.
It is in the interconnected world of ours that local, national monetary modalities are to be considered in a global monetary modality that opens up the wellspring of creativity for the wellbeing of people, species and planet. It is this global modality that has been presented in detail in The Tierra Solution: Resolving the Climate Crisis through Monetary Transformation which will be published in early May.