Town That Gave Itself A License to Print Money

The Observer - Jamie Doward, Naomi Loomes - The value of sterling may be plummeting as fears grow over the depth of a
possible recession. But in the scenic East Sussex town of Lewes - famous for
its bonfire night parties and bewildering number of pubs - a handy
alternative is about to become available.

Next month, in the latest sign that localism is a coming force in British
everyday life, Lewes will launch its own currency. In doing so, it joins a
growing list of communities around the world attempting to protect regional
economies and preserve the distinctive 'feel' of towns and villages.

The Lewes pound will initially be accepted in around 30 locally owned shops
and a first run of 10,000-plus notes is expected. It is the largest-scale
launch of a local currency in the UK since Lewes had its own pound in the
19th century and, in a coup for the organisers, the town's branch of
Barclays bank has agreed to accept it.

Those pushing the Lewes pound, which by law cannot display the Queen's head
but is legal tender, stress their humble ambitions for the new currency.
'There will always be a need for a national currency, but it's a question of
trying to go back to what can be done locally,' said Oliver Dudok van Heel,
one of the scheme's architects. 'This is not us versus the rest of the
world,' added Beth Ambrose, a sustainability expert, who denied that the
Lewes pound was a declaration of independence. 'All we want to do is
strengthen what's good in our community.'

According to one analysis, 80 per cent of the money that goes into a
supermarket till leaves the local economy immediately. By backing local
stores such trends can be reversed, say the scheme's supporters. 'We had a
beautiful, independent toy shop here once,' van Heel said. 'It's now an
estate agent.'

Lewes is not alone in its aspirations. In Totnes, Devon, a complementary
currency has been running for more than a year. Similar schemes have been
launched abroad and it is estimated there are about 9,000 around the world.
Across the Atlantic in Berkshire, Massachusetts, some $800,000 worth of
local 'Berkshares' are boosting a thriving alternative economy. Switzerland
has introduced a localised credit card scheme, while Holland and Germany
have had a surge of interest in complementary currencies.

Those backing the new schemes say they are 'big tent' projects which try to
involve the whole community. Experts agree that they thrive in places where
people have become disillusioned with central government, suggesting they
reflect more than merely economic concerns.

'This is political, but with a small p,' said Patrick Cockburn, a Lewes
resident who is backing the new currency. 'It seems a Tory sort of idea -
empowering individualism - but it's really about boosting the local
community.'

In Argentina, demand for local currencies took off after the economy
collapsed in the late Nineties. 'These types of currency go right back,'
said David Boyle, a fellow at the New Economics Foundation in London. 'There
was a flurry of complementary currencies in the Great Depression. But
President Roosevelt outlawed them because he was afraid they might undermine
the banks.'

For this reason, proponents of the Lewes pound believe now is the right time
for its launch. 'With the current credit crunch, there is some disquiet
about the global economic system,' van Heel acknowledged. 'Who knows how
important this could be? Studies show if there is more than 12 per cent
unemployment in a community these systems become very popular.'

If anywhere can make a new currency work, the locals of Lewes claim it is
their town, which prides itself on its independent spirit and the absence of
the likes of Starbucks. It already has form when it comes to minor
uprisings. After Greene King, the brewing and pub chain, stopped selling the
locally brewed Harveys beer and ale at the Lewes Arms there was a mass
boycott and the drinks were back within months.

Perhaps, then, it is no coincidence that the town's most famous resident is
the radical political pamphleteer Thomas Paine, credited with sowing the
intellectual seeds of American independence. Etched under a painting of
Paine on a wall of one of Lewes's churches is one of his most famous
aphorisms: 'We have the power to build the world anew.'

Two centuries on, the inhabitants of Lewes have the chance to show in their
own small way that they still agree.