David Birch at kashklash has been thinking about alternative currencies. He’s decided that local currencies, while their hearts are in the right place, are not the solution their advocates claim them to be:
They’re wrong because their notions of locality are too backward-looking. So while I buy the idea that some form of localisation of money it might be part of an overall trend, a reaction against globalisation and so on, I think that localisation in the coming online world means something different from the slightly romantic, slightly unworldly, geographic notion of locality that is at the heart of many current schemes.
So what might we use as alternative currencies instead of localised money?
People don’t seem to have a problem holding World of Warcraft money, or iTunes’ money, in addition to money in their bank accounts. Given a free (or, at least, vanishingly small marginal cost) choice, what would they prefer? We’ve already touched on gold in the earlier discussion about alternative currencies and the price of oil. But I’m curious about other non-commodity suggestions: telecommunications bandwidth, mobile minutes…
As a commenter points out, bandwidth and mobile minutes are commodities to most of us… and the more I think about it, the harder I find it to think of anything that would make a practical currency that isn’t a commodity. Calories; water; kilowatt/hours… can you think of any more? [image by bradipo]
Is the local currency an idea whose time has come – or rather, has come back? In the Berkshires of Massachusetts, a local currency called Berkshares is being buoyed up by the current economic crisis, and receiving a lot of enquiries from other communities interested in replicating its success:
Since the currency’s launch two years ago, five local banks have printed more than 2 million paper notes. About 185,000 are currently in circulation, according to Susan Witt, a Berkshare co-founder.
It’s in no way ready to replace regular money just yet, but it seems to work well as a supplementary system during hard times. The problem is the admin – there’s a lot of work involved for what is usually a small volunteer organisation, which is why the Toronto Dollar is moving to an electronic version to simplify the management procedures.
As the strength of the nation-state concept atrophies, will we see an increase in local communities making their economies more sustainable and autonomous? Given the rising cost of transportation for both people and goods, it doesn’t seem too implausible.
Currently for every 1 calorie of food, some 10 calories of energy are used to make it. As George Monbiot said in the Guardian last week, it is increasingly unclear where future supplies of water and phosphates will come from. After world war two the world population was around 3 Billion. Using newer techniques and fertilisers we have increased the amount of food an acre produces. The population has risen to match. Fertilisers are almost entirely all oil-based on large scale, however. With biofuels taking away land and oil prices rising as well as increased transportation costs, the current system of food from around the world is becoming a danger to supply. If the recent survey of 155 oil experts saying peak oil will come before 2010 turns out to be true, we will have to downscale very quickly indeed.
Two ways to combat this would also reverse many of the social changes of the last thirty or so years. Firstly, the reduction of food miles by producing stuff closer to home will bring down fuel needed to transport the food, often a massive contribution to the energy cost. The second involves fertilisers and other fuel-intensive techniques. As the amount of machinery and fertiliser brought into farms decreases due to prices, manual labour becomes increasingly important again. Eating less meat, particularly red meat, will reduce the amount of calories an acre of land can produce, as well as boosting our health. Large farms currently operating with few employees will need to split into smaller units and introduce nitrogen fixing vegetables between grain crops. On a social level this could increase the number of people making a small living for themselves off a plot of land, selling most of their produce locally. Using more varied crops, utilising the seasons and even vertical farming mean we could have good food even without shipping it in from abroad.
[photo by Chris Jacobs for The Vertical Farm Project]
Note: edited to attribute the photo to Chris Jacobs, who says: ‘For all of you out there…this illustration is NOT how a real vertical farm would be…it would be 100% hydroponic. This was just created to “show” growing food.’ – thanks for keeping us informed Chris!