Essay: Istanbul New City Reader

NCR_OverleafRead the full article as published here.

When talking about changing the world it is becoming a main stream notion that a good place to start is the economy. And when talking about changing the economy its not an insider idea anymore that our monetary regimes are the best place to start on that on. Now, from this point onwards there are basically to strategies being pursued: one is to figure out what is going wrong with the way money is created and distributed today and lobby for smarter ways to do this, a.k.a. monetary reforms. This holds the promise of massive positive impact and widespread instantaneous changes to all walks of life. Another strategy, not only for those who don´t want to throw their hopes and efforts in the basket of politics and taking on the vested interests of the establishment head first, is to redesign our approach to money and economy altogether. This means building new monetary subsystems at the fringes of what seems feasible and possible today and allow for them to grow into the viable alternatives that are so hard to image from inside the box. Such initiatives find a common ground in the engineering of completely new currencies which are subsumed by the terms complementary or community currencies.

To many this is still just an idealistic endeavor which can never make it mainstream or would only ever be of use in the face of sheer crisis or after a complete collapse of our financial systems altogether. Indeed, historically such non-national, non-legal-tender currencies have always sprung up in times of crisis. Often quoted examples of this were seen in the US and Europe during the great depression of the last century, the economic meltdown in Argentina in the first years of this century and currently in Greece.

But in recent decades this ideas have formed into an emerging academic discipline and global movement. After the oil crises in the 1970 had spurred local groups to seek more economic resilience, LETS (local exchange trading schemes) became a widespread currency-format to complement such efforts. Soon after the idea of Time-banking, members accounting for each other’s services on an equal bases – hour by hour – followed in the footsteps of LETS systems and reached global spread and since strived particularly in the inter-sectorial and social domain. In the early 2000s local initiatives reinvigorated ideas of economics maverick Silvio Gesell (1862-1930) and created local and regional currencies based and backed by legal tender but with anti-hoarding rules that aim to create more local demand by increasing the circulation rate of the currency. The Chiemgauer currency (add to your list) , one of the landmark examples of these models in southern Germany, celebrates i 10th anniversary in 2013 and has inspired several similar currencies in the UK and the US. Some of these now make headways into the next generation of currency models in terms of technology and stakeholder engagement. The Brixton Pound in London was the first such currency to enable users to pay by text messages, reducing cashless transaction costs for small traders. The recently launched Bristol Pound being the first to have strong support from the local council and the local credit union from ist inception. The newly elected mayor´s announced to take his salary in Bristol Pound as one of his first acts in office.

Often overseen in this regard is another strand of currencies that cater directly to the needs of small and medium sized enterprises, by providing them lines of credit that can be used with all participating businesses. The WIR in Switzerland is a nationwide currency of this kind that has started during the depression serves a current community of over 60.000 businesses (over 16% of all businesses) in the country for over 70 years. Similarly there are dozens of these business-to-business currency networks around the world, trading locally, nationally and even internationally. (add to your list)

In the last few years there is also a raise in interest in these innovations by public entities, mostly municipalities and local governments, realizing the potential that these technologies hold for engaging their constituencies in meaningful ways, delivering their public services more effectively and efficiently and putting local value, not increasing debt burdens, towards their future development.

Yet there are a few common threads that all these different models have in common, and which makes them such strong contenders for transformative tools. Participation in all of these currencies is voluntary. Users will only ever take to them if there is a clear benefit for them in some way. And this is where complementary currencies tap into a far more divers values than our current monetary regimes can: the benefits can be on an individual or collective level, they can be economic, social or environmental, they are freely determined by the initiators and need to resonate with the users possibly in all the facets of their human and societal interactions. In this ambition, complementary currencies are in continuous checks and balances and need to evolve and adapt fast in response to users’ behavior.

The involvement of different stakeholders and the employment of new connective technologies is supporting this and enables these currencies to create new value and support our personal values in whatever community they are applied at: locally, regionally, sectorial, virtually or even globally.