[Nettime-bold] Re: <nettime> In Gold We Trust, part 1

[Keith Hart <HART_KEITH@compuserve.com>]

Doug Henwood wrote:

>I'm still at a loss to understand how these "community currencies" 
would be used to pay for products outside the community. Or will 
every community have its own steel mill and chip plant? It's a big 
leap from using scrip to exchange products at a roughly similar level 
of technical complexity and capital intensity - meals for haircuts, 
housecleaning for dogwalking. But what about things that require 
machinery, financing, specialized labor, and entities that extend 
across time and space to produce them? How would a New Yorker like me 
get a computer or an orange? Once you get beyond exchanging simple 
goods and services in a small geographical area, you have to have a 
state-guaraneteed token (or gold), or you can't have commerce. Or are 
you really proposing that production be undertaken strictly on a 
local scale? Do you even think about the relations between money and 
production beyond the level of sentiment and wish?<

Networks using community currencies are very limited in size of membership
and economic scale at this time. They also tend to be highly localized.
There is no question of them, in their present form, being able to replace
existing capital markets or for that matter public economies financed by
state taxation. It is unlikely that steel mills or computer manufacturing
will be funded in this way soon. But there are LETS systems in which
businesses participate. They may be willing to sell quite complex
manufactures on a part national, part community currency basis. This
increases their turnover and expands the spending power of their customers.
The technology that would allow virtual exchange networks to be organized
through open money is in the process of being developed. This involves
multiple currencies operating through smart cards and internet
communication organized through a national domain naming system. This
involves serious international collaboration in software engineering which
rests on more than mere sentiment.

It is true that much of this remains potential, but there are significant
actual achievements and some parts of the economic establishment are taking
open money seriously. Thus some Japanese corporations have joined
grassroots organizations to explore the use of LETS; a department of the
government has also shown interest. Given the ubiquity of mobile phones
linked to the internet there, who knows what will come out of it? The
European Commission in Brussels has begun to look into community currencies
as a way of addressing the problem of electronic micro-payments. The recent
Argentinian crisis revealed a proliferation of self-made currencies below
the state level from the provincial governments downwards. Red Global de
Trueque Solidario issued 15 million creditos in an attempt to get some
liquidity into the economy. There are many precedents for such
developments. What makes now different is the communications revolution
breaking out all around us.

So Doug Henson is right to point out that most existing community
currencies operate at a low level of complexity and they cannot organize a
full-scale capitalist division of labour. Most of the achievements I can
point to are more potential than actual. Even so e-bay and paypal have
revealed possibiltities in electronic commerce that would have been
unimaginable a few years back. Those of us working on community currencies
see no point in limiting our aspirations to current empirical knowledge,
even less to the idea that the only forms of money with any clout will
always remain state money and commodity money (eg gold). There is work to
be done on improving the model and inserting it into new situations. It is
true that we are focused mainly on the sphere of circulation, but that is
not to say that we are indifferent to production.

It is highly unsatisfactory trying to persuade a skeptic (to be kind) of
what this project is worth in a few paragraphs of an email message. That is
why my partners and I are currently writing a book about it. It may be that
our eyes are trained on the future more than the past, but our present is
fully occupied in all kinds of practical and theoretical ways. Keynes said
that a writer depends on a lot of sympathy from his readers. If the
metaphysical gap is too great, mutual understanding is impossible. Or, as
the Reverend Sidney Smith once said, while observing an quarrel between two
women leaning out of windows on opposite sides of the street, Those ladies
will never reach agreement, for they are arguing from different premises.

I have read Doug Henson's recent book and benefited from it immensely. I
would be interested in what he thinks of mine. Perhaps these issues can
only be pursued effectively through serious publication. Nevertheless, it
may be that some nettimers have been provoked by these exchanges to think
about money in a slightly different way.

Keith Hart

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