Sharing Is Good: How to Save Money, Time and Resources Through Collaborative Consumption Read Online Free Page B

paid their local taxes and their local suppliers with them.
    “This new currency led to a dramatic increase in economic activ-
    ity, which was partly due to a special feature of the notes,” writes James Robertson in The History of Money. 3 “They lost one percent of their value every month, unless their holders attached a stamp bought from the town council. People were eager to spend them
    as soon as possible before they lost value — which increased what economists call the ‘velocity of money’; the sooner people spend it, the faster it circulates.” This alternative currency was so popular that soon the Austrian government began to feel like it was losing control over the country’s monetary system, and, as we know, maintaining
    control is very important to the status quo.
    So, despite its success, Austria outlawed the scrip in 1933,
    right about the time when New York bankers convinced President
    Roosevelt to do the same in America. The new bank system that
    emerged in both countries was far more centralized and tightly controlled than before. That should tell you something about the power of currency and how significant it can be when people opt out of the socially acceptable monetary systems.
    History of Sharing
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    For the next few decades, local and alternative currencies fell
    to the wayside as developed nations experienced relative prosper-
    ity. Still, the system that had saved so many communities from ruin was never far from the minds of innovators and activists. In 1973, a Massachusetts economist named Ralph Borsodi devised a currency
    called “The Constant.” Protected against inflation by a backing of 30 commodities, Borsodi hoped his alternative currency could be
    guaranteed against devaluation. “The idea was exciting enough to the surrounding community that up to $160,000 worth of Constants
    were circulating in general use throughout the region, not only in paper currency but in checking deposits at local banks as well,”4
    writes Andrew Lowd. “Though he never got around to purchasing
    the commodities, the program ran, backed by dollars, for almost two years before Borsodi’s health and old age caused the program to fold.”
    Throughout history, local currencies have been used not only as a way to survive during periods of economic uncertainty, but also as a bold way to opt out of a global monetary system that many find ex-clusionary and, in some cases, corrupt. As I’ve mentioned before, the only thing that gives modern money value is the fact that the majority of people agree that it has some value. Of course, people can change their mind about how much value a coin or bill has, and that’s why exchange rates can vary so widely. For those who only have access to very limited amounts of money, these small shifts can be devastating.
    This ambiguity can also be viewed as opportunities for the have-nots, however. If a community comes together to replace currency with
    another measure of value, they can flourish outside a broken system.
    In 1998, the residents of the Palmeira District, a slum in
    Fortaleza, Brazil, decided they were tired of living on the bottom rung of a monetary system controlled by a wealthy few. The community came together and created an organization called Association of Neighbours of the District of Palmeira. This Association then
    created a new bank — the Bancos des Palmas, or Palm Bank — and
    a new currency, the Palmas.
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    Sharing is Good
    The bank was set up to fight poverty and improve the living con-
    ditions of the residents of the district of Palmeira, but it has achieved much more over its 14 years of existence. Before the bank was set up, local producers rarely sold produce to their neighbors and the local residents tended to buy their goods elsewhere. As participation in the community bank became more widespread, community members slowly altered their consumption and spending habits to take advantage of the bank’s service. Spending on local commerce