The Realm's Coin Remains Local
Albany Times Union - Marlene Kennedy - Ithacaness. It was a term coined years ago by a cadre of college friends. A code word, really, that was mocking but at the same time just a bit envious.
Ithacaness embodied the uniqueness of the Tompkins County city at the southern tip of Cayuga Lake: the organic restaurants, the food co-op, the pottery and craft stores, the political and social activism. They did things differently there, and proudly too.
To those of us living nearby in the uncool hinterlands, Ithaca was alternative urban chic.
So it was no surprise that the term came to mind as I was researching the concept of local currency. Ithaca is credited with having one of the oldest of the modern local currencies, Ithaca Hours, which date to 1991 and are the only local scrip still active in New York state, according to The E.F. Schumacher Society. Of course. What Ithacaness.
Or was it? Maybe the city had graduated from hippie capitalism to something else. Decentralism perhaps?
That concept is the polar opposite of today's giantism, says the Schumacher Society. It's a belief in "restoring community self-reliance and bringing economic and social activities back to a more human scale'' an idea easily embraced by those who don't worship Wal-Mart or cheer Thomas Friedman's "The World Is Flat.'' The Schumacher Society, based in Great Barrington, Mass., is devoted to bolstering local economies. It's named for the late Ernest Friedrich Schumacher, author of essays on sustainability, regional economic systems and community land trusts that were compiled into a 1973 book, "Small Is Beautiful: Economics as if People Mattered.'' And the group, founded in 1980, champions local currency, or what it calls "slow money'': a deliberate, thoughtful exchange between merchant and customer. The group helped launch BerkShares last fall, a currency circulating in southern Berkshire County in Massachusetts.
Unlike Ithaca Hours, where one Hour is valued at $10 (and half Hours and quarter Hours have equivalent fractional values), the BerkShares system has familiar denominations: 1, 5, 10, 20, 50. BerkShares are purchased at 90 cents on the dollar: You pay $9 in U.S. currency for $10 in BerkShares, which can be bought through hometown banks like Berkshire Bank and Lee Bank. The BerkShares are accepted only by local merchants no shopping with them at Wal-Mart or Target or Amazon.com.
Local currencies are meant to keep proverbial Main Street alive. Suburban malls, big-box retailers and e-commerce may be the bane of mom-and-pop shops, but you can fight back with local purchases. And the currency is intended to circulate among merchants, too: In Great Barrington, for instance, if you pay for a restaurant meal with $50 in BerkShares, the restaurateur can use the scrip to pay his local produce supplier, who then pays a local farmer, who buys his seed at a local farm store, and so on. (A merchant can redeem the BerkShares at the local bank for greenbacks at any time, but at the 10 percent discount getting back the $9, for instance, that was originally paid for $10 in BerkShares.)
Buying local is not a new concept; indeed, it's often the rallying cry when a new Wal-Mart store is on the horizon. A local currency, though, puts action to the sentiment.
But the process of establishing a local currency isn't easy; it takes time and commitment all down the line, from organizers to merchants to consumers. (There is no constitutional bar, though: as long as it's paper currency, it's legal under U.S. law.)
BerkShares were a dozen years in the making, The New York Times reported last month, and continue to see hiccups: the merchant who accepts them but quickly redeems them to keep his 10 percent hit low, the store that takes them only on slow days during the week.
But attorneys and CPAs accept BerkShares, as do acupuncturists, life coaches and churches, according to the BerkShares Web site. As of late February, 135,000 BerkShares were in circulation, accepted by 230 businesses.
BerkShares Inc., the overseeing nonprofit organized by the Schumacher Society, local banks and the Southern Berkshire Chamber of Commerce, is talking to other Berkshire County communities about the currency with an eye toward expanding. And a BerkShares-dispensing ATM also could be in the offing.
Money may be abstract, but slow money "makes us conscious of the impact of our economic transactions not just as purchasers, but as taxpayers, investors and philanthropists,'' says Susan Witt, longtime executive director of the Schumacher Society.
"Perhaps the greatest task of concerned citizens in the 21st century is to reclaim responsibility for the consequences of our economic transactions personally, institutionally and in public spending. Slow money is the start of this process,'' she says.