Your cash ain't nothin' but trash;Book of the week
Who needs real money when you can swap services at the sam time as helping solve social problems with yourown invented currency? Aleks Sierz finds enlightenment in a finance book with a difference.
Any teacher looking at their pay slip can be excused for being sceptical about the relationship between money and value. For anyone who has ever asked themselves, "Am I really worth so little?", Funny Money will massage the ego with its message that money is not the best, or only, way of measuring worth.
Of course, many people already use alternatives to cash - for example, your credit card or supermarket loyalty points - but these are controlled by big business, just as regular money is policed by the state. But what if you could create your own money?
To find out, David Boyle, a London-based journalist, toured the United States in search of alternative money, talking to people who "conjure spending power out of thin air". He found many local communities that had invented their own money systems.
These local currencies, called LETS (local exchange and trading systems) here, and "time dollars" in the US, are inflation-proof, non-taxable (so far, although the Inland Revenue occasionally takes an interest in individuals' "earnings") and inherently stable. After all, no one's going to gamble Gloucestershire's local currency, the "Stroud" on the international money markets. Nor is the Manchester "Bobbin" likely to join the Exchange Rate Mechanism.
How does alternative money work? Boyle says LETS were set up to help solve the problem of poverty and mass unemployment, when "you have people with skills and time on their hands, and you have jobs that urgently need doing - but no money to bring the two together". LETS plug the gap.
All you need to do is give your currency a name - such as "Stroud", "Bobbin" or "Oliver" - and set up some central way of registering who owes what to whom and, hey presto, people can start swapping home tuition for cleaning, baby-sitting for DIY, dog-walking for dressmaking. In a typical LETS transaction, A does B's accounts and collects "cheques" - vouchers - in "Bobbins" or the local equivalent, which he can spend on a massage from C, gardening by D or any of the other services listed in the local scheme's directory, which also gives the "Bobbin" rate for each job. B has paid A with "Bobbins" earned by painting E's house.
The United Kingdom now has more than 450 local schemes: one in Kingston upon Thames, Surrey, enables you to buy goods as well as trade services; another in Manchester allows you to pay part of your rent in Bobbins in exchange for certain services. Researchers believe that the equivalent of pound;32 million is traded in LETS currencies in the UK every year.
So why did David Boyle go to the US? "These currencies are more developed there," he says. "Americans think differently about money than we do. They're very relaxed and 'can do' about it. The Brits, on the other hand, are fatalistic - money is seen as something that we're always running out of."
And only in the US could you have the case of Zabau Shepard. In 1990 Zabau Shepard started receiving credit cards through the post. The only problem was that she was a dog. In a land where credit is so easily available, "it was only a matter of time before people started inventing their own money".
One of his more inspiring stories is that of Edgar Cahn, who developed time dollars as an alternative currency. "It proved particularly useful for kids in tough Chicago schools," says David Boyle. "They ran a scheme where the least successful 16-year-old pupils were tutoring the 14-year-olds. They were paid in time dollars, which they could use to buy a range of services, especially refurbished computers."
This not only helped educational attainment but "also had some amazing side-effects. Bullying stopped completely - you don't beat up the child you're teaching and you don't let anyone else do it either." And the students learned how to use computers.
"American business throws out 15 million computers every year - they're just dumped." Such computers only need some refurbishment and they can be used again. And the centres set up to fix the computers also train deprived young people in electronics.
Even more ambitious has been a Washington scheme to rebuild inner-city communities by encouraging teenagers to train as youth court jurors, also paid in time dollars. Once again, "this is a way of enriching some of the poorest and most excluded members of society", says David Boyle.
And has he ever been part of any LETS scheme? "No, there's never been one where I live. Besides, LETS works best for people who have a lot of time, and I've always been completely rushed." Alternative currencies are less appealing to busy professionals.
"None of these schemes is meant to replace money as we know it," he says, "but to make it go a bit further - to improve some aspects of people's lives that the main economy undermines. Time dollars, in par-ticular, help to build community. Ifit's done properly, you can save a lot of money by helping to solve social problems."
For example, setting up a local currency might cost pound;25,000 - many schemes are big enough to need computers, office space and administrative staff - "which is nothing if it enables you to pay volunteers to look after old people at home and thus make savings on hospital beds or old people's homes". Its most enthusiastic advocates tend to be the young and the old, "who have a gut feeling that you can change things".
Part travelogue, part polemic, Funny Money is an inspirational book, crammed with ideas and crowded with eccentrics, the pioneers of alternatives to cash. After reading it, the Queen's head on Britain's banknotes looks somehow less impressive.