D.I.Y. CASH - GREENING THE LOCAL ECONOMY

Helen Dew, of the Living Economies Trust (1), presents the second in a series of articles on the link between sustainability and the money system. (See ONZ May/June for first article.)

Local currency systems are now being integrated into the plans of ‘Transition Towns’ (2), in preparation for the inevitable life-style changes demanded by Peak Oil and Climate Change. These community led currency systems connect underutilised resources with unmet needs, facilitating the exchange of goods or services using currency designed and created by and for each community.

Initiated by grass roots groups, local currencies work alongside the conventional money system, complementing and stimulating the local economy and fostering a sense of community. While there are a diverse range of currency models, the first to be introduced to New Zealand, in 1991, was the Local Exchange and Trading System (LETS) (3), commonly known as Green Dollars.

“Community currency involvement began for me 16 years ago when I joined the newly formed Wairarapa Green Dollar Exchange (G$). In addition to seeing G$ as a means to supplement my income I liked the ‘self-help’ and community building potential of the system.

Also, since community exchange systems are interest-free, unlike conventional money systems they are non-exploitive of people and the environment. This is an important if not vital consideration given concerns about the increasing degradation and depletion of natural resources, the dangers of climate change and the attendant stresses on people and all living systems.

Using a means of exchange designed to honour and respect rather than exploit is fundamentally a matter of social and environmental justice. Some would say it’s also a matter of survival!

• So, what is a LETSystem, and how does it work?
• Who, typically, is involved?
• What has been the experience of existing groups in New Zealand?
• Where do LETS already exist?
• What effect has LETS had on local economies?
• What would it take to make LETS easily accessible anywhere in New Zealand?
• How would this benefit individuals, local communities, and the country as a whole?
• How can new groups get started?


A LETSystem is:

• a community-based mutual credit system
• designed to stimulate local trade and employment opportunities
• and retain more wealth within the community.

A directory lists offerings and contact details; an accounting system records each member’s sales and purchases.

Individuals can offer skills like computer work, gardening, tuition, produce, knitting, baby-sitting etc.
While business members sometimes sell for100% G$, they more often prefer a percentage of the payment in G$ with the remainder in conventional money. For businesses this acts like a loyalty incentive.

Regular market days see lively trading, as well as providing an opportunity for members to meet socially. Stalls are set up in town, and non members are welcome to purchase with conventional money. Getting to know one another personally encourages trading to take place between markets.

It’s important to understand that we’re not talking here about barter, where there needs to be a double coincidence of need. Barter is usually impractical, which is the reason that money is preferred to swapping chickens for labour or cattle for potatoes! LETS currency works just like conventional money, but instead of exchanging notes, coins or cheques ’chits’ are used to record trading details for later processing.

Members manage their own trading data, generate their own ‘bank’ statements and update their goods and services listings with software trialled for three years by South Africa’s Community Exchange System (CES) (4). Local administrators process data for members lacking internet access. A demonstration of the incredibly versatile and user-friendly software is available at http://www.ces.org.za/demo/index.htm

LETS for sharing and self help.

Being a LETS member has been a great way for me to share surplus produce and plants from my garden. In return I’ve been able to employ help and purchase gifts and treats. Some members have been encouraged to start their own gardens through purchasing my seeds and plants with G$.

Being involved with community currencies has also enabled me to meet people I may never have otherwise met, locally, nationally and internationally. This has vastly extended my network of contacts and also increased my circle of friends!

Green Dollars has been good for the local economy too! Keith Sawyer, co-ordinator of the Wairarapa G$ Exchange, reports ‘more than $1m in trades has been facilitated through the Wairarapa Green Dollar Exchange since its inception. That’s good for the members, the economy and for the community!’

Most trading is done locally, but trading between Exchanges is also possible. Groups operate in Thames, Rotorua, Taranaki, Wanganui, Wairarapa, Blenheim, Golden Bay, Motueka, West Coast, Wanaka, Christchurch, Timaru and Invercargill.

To date the contribution of G$ to regional economies has been miniscule in comparison to conventional economic activity. However, the system could very easily expand to accommodate increased demand, and help is readily available for new groups wanting to start. For areas yet to establish a group the NZ Community Exchange enables individuals to begin trading until they recruit enough members to open a local Exchange.

Trading with local currency is increasingly being recognised as one of the essential tools for regions planning re-localisation strategies. For New Zealand the big advantage with LETS as opposed to other attractive and effective currency models is that lets is already functioning in several centres.

Work has begun on introducing other forms of community currency to New Zealand, including Time Banking and voucher systems. We’ll look at these in subsequent articles.

References:
1. Living Economies www.le.org.nz Enquiries: Helen Dew, 12 Costley St, Carterton 5713, NZ.
2. Transition Towns http://news.bbc.co.uk/2/hi/uk_news/england/devon/6692755.stm
3. LETS http://www.letsnewzealand.org.nz/tiki-index.php?page=LetsIntro
4. Community Exchange System http://www.ces.org.za/

This article was published in the Sept/Oct (2007) issue of ORGANIC NEW ZEALAND
Enquiries: Helen Dew helend@contact.net.nz Phone 06 379 8034.