Marketplace Morning Report
Available from Amazon.com

Jordan Goodman is the author of Everyone's Money Book, available at 888-201-6300. This is the third edition of the book. You can also visit his Web site at www.moneyanswers.com. He talks with us on Thursday mornings.

September 5, 2002

"Local Currency Movement"

You may think it is illegal to print your currency, but that is not true. In fact, a rising number of communities around America are creating their own "local currencies" to support their area businesses and tradespeople, and to create an alternative to the global economy.

Part of the reason that communities create their own local currencies is to feel more in control of their own destinies. Having a common currency, like the U.S. dollar, puts the power of economic decisions in centralized hands far away from these local communities, and creating a local currency returns some of that power to them. The Federal Reserve and IRS have no prohibitions on local currency, as long as their value is fixed to the U.S. dollar, the minimum denomination is $1 and the bills do not look like federal money.

The first example of local currency began in Exeter, Mass., in 1973 when an economist Ralph Borsodi issued currency for the local community, but the experiment failed about a year later. In 1989, a deli owner in Great Barrington, Mass., was rejected for a loan by the bank and issued "Deli Dollars" to customers who bought $10 worth of products for $8, which helped him finance the relocation of his store. In 1993, another currency, the "Berkshare," was issued in the Berkshires by the Berkshire Farm Preserve, which was very successful at first, though now it is dormant.

    The movement has been spreading ever since, with local currencies now active in:
  • Ithaca, N.Y. (Ithaca Hours)
  • Madison, Wis. (Madison Hours)
  • Philadelphia (Equal Hours)
  • New Orleans Public Housing Complex (Mo Money)
  • Olympia, Wash., on Puget Sound (Sound Hours)
  • Berkeley, Calif. (Berkeley Bread)
  • Santa Barbara, Calif. (Community Currency of Santa Barbara)
  • Toronto, Canada (Toronto Dollars)

Here is how a local currency system works: Currency is printed by a central exchange and distributed to businesses, and members who use it instead of U.S. greenbacks. Most businesses accept the currency for the entire bill, while others only accept partial payment in these bills. The result is that the local community is strengthened, spending patterns change, and residents and businesses get the satisfaction of getting paid for what they enjoy doing.

To find out more about the local currency movement, or to start a local currency in your community, you can get a Home Town Money Starter Kit and video for $40 from:
HOUR Town, Box 6578
Ithaca, NY 14851
www.lightlink.com/ithacahours
or, the Schumacher Society, 413-528-1737, (www.schumachersociety.org), which publishes Local Currency News.

For More Financial Tips From Jordan Goodman


Marketplace sponsors
MPR  Minnesota Public Radio  |  Search |  Comments © Copyright & Terms of Use  |  Privacy