Workshop 8: SOCIAL MONEY

Summary

Today there are a number of complementary money experiments that have set up different forms of exchange, in an attempt to deal with an absence of money. This workshop has been particularly concerned with studying those that have attempted to focus on the possibilities of “ an alternative economic way” and which have enabled the practice of social control, at the outset complementary to formal economics, but perfectly capable, eventually, of strengthening the sector known as the economy of solidarity and of proposing the construction of a new pattern of social organisation.

State of Affairs

1. The theme of complementary money is, for all intents and purposes absent from debates about alternative methods, whether or not the area of debate is economics, politics or social organisation. Doubts (well founded) have been frequently voiced concerning the medium term future of these initiatives: change a little so that nobody changes? Or move forward in the construction of a new social contract?

2. On the other hand, it is fully acknowledged that one of the major manifestations of the social crisis, economically speaking, has been the channelling of large amounts of money towards the financial sector, to the permanent detriment of the production sector. In effect the financial sector enjoys significant advantages over the latter in terms of the “creation ‘ of money. The possible answers to this crisis have all floundered on a lack of money: whether it has been foreign debt or the rebuilding of the jobs market, the decline of domestic consumption that has become a source of violence and inequality, or environmental destruction caused by an inability to control the conduct of producers and consumers.

3. As long ago as the thirties, following the crisis, similar experiments had appeared in different places, but it has above all been during the last 20 years that exchange experiments have multiplied. They include LETS, created in Canada by Michael Linton from 1982 onwards and the Ithaca social money, in the state of New York, conceived and set up by Paul Glover throughout the United States. In Argentina the first barter club (which later developed into the Global Barter Network – Red Global de Trueque) was created in 1995 by a group of 23 people; 6 years later, it consists of 500,000 members and has spread throughout the provinces of the country. This model, which posses a strong ability to reproduce, is characterised by a strong decentralised structure (the principle of autonomous clubs or “nodos”) and the use of “social money” itself. This demonstrates that ‘barter’ has developed from its primitive version towards a method of multiple exchanges, which has been achieved with the intermediary of material aid, produced, distributed and controlled by the users themselves. At the present time the method has been copied in 11 Latin American countries and has inspired a number of initiatives in other latitudes, such as Spain, Japan and Thailand. Although it is difficult to give exact numbers, it has been estimated that a million people have experienced and practiced the various types of compensatory exchange, with or without social money, or with mixed systems as well.

4. If it is possible to neutralise the lack of money, it is worth wondering.

How far could these systems develop? Are they just a response to a crisis? Or do they contain the seed of a deeper social transformation? How can we share the advantages and limits of each of these initiatives? Apart from what already exists, would it be possible to draw up new proposals? How?

5. The following is the result of rich and fertile exchange and synthesis, carried out during the last few months by 70 participants from different countries as well as proposals drawn up during the meeting in Santiago.

6. The central statement of the working paper contained a reminder of the responsibility of the different social operators in this area, that is as much innovative as polemic. In effect, the very different experiments- past and present – have neither been studied nor developed enough to be judged as a suitable alternative to the dominant model. In this way the text recommended a necessary review of the epistemological point of reference for the different experiments, a veritable “crossroads” for a new allocation of responsibilities. What is the role of the theoretical categories that we use whilst building a new consensus for action? Are they limited or do they help?

7. Contributions from the different reference texts have shown that different para monetary approaches, complimentary to the national currency, have been used during recent decades, obtaining a degree of “ legality”, without putting an end to the structural economic crisis with which we are currently faced. According to some writers the innovative nature that we see in several of the successful experiments, are the result of the allegiance to another paradigm, more specifically, the paradigm of abundance; this could be said of the Argentinean experience of social money.

8. During the forum representatives of many of the varied experiments running today were seen actively participating in the discussions: the most experienced people in the field contributed to the discussion and illustrated the relative isolation, with respect to each other, in which they find themselves. There was little “dialogue” between the experiments and more “defence” of positions already established.

9. Finally, during the Meeting, the need and urgency of bringing the different experiments together was acknowledged, both among themselves, with the extremely varied social money associations and other utopian pioneers, spread among the fourteen other workshops of the Workgroup for a Socio Economy of Solidarity. This is paramount to saying that not only has the possibility of getting to know each other been recognised but also the necessity of entering into relation with each other, integrating, and complementing each other in order to take full advantage of each specific model and adapt it to each individual circumstance.

1. Contact with Foreign participants who had had the opportunity to experience the Argentinean experiment, in all its glory, only served to confirm the possibility of imagining a grass-root, self managed process. It also revealed the faults, which very clearly demonstrated the need for a specific type of support for this initiative: social money is not enough in itself to go beyond the model of scarcity in all its forms. It must be accompanied by other steps of the production process, over and above the specific model of “fair trade” that represents the replacement of the official currency by social money: this implies the need to create a production and consumption of solidarity. Production must go beyond disequilibria and neo-liberal individualism and look towards models of collective production, specific to each case; consumption must find an ethical route that protects the environment for present and future generations

2. It would seem that many of us believe that we are standing on the threshold of a constructive crisis. In fact, many events indicate the possibility of combining – for the first time in the history of humanity – the technology available for food production and knowledge, with the digital world and our limited material resources. With the intention of achieving a quality of life for all the inhabitants within our society. To do this, we have to be capable of listening to each other and allowing ourselves to be filled with ideas that come from social practices throughout the four corners of our blue planet!

Proposals

These have been divided into two groups of similar importance: those destined to spread and deepen the activities taking place (proposals 1 to 8) and those aimed at discussing and setting up new projects (9-10). In both cases it is a matter of – explicitly – avoiding the delicate situation of a “single thought” or the “best alternative”, like certain successful experiments have done, but searching for inspiration in local experiments, which have a practical “knowledge”, acquired by the operators themselves and which even constitutes the situation of their growth and durability.

1. Identify and spread the different types of compensated exchange towards other forms of the economy of solidarity and the whole of society, comparing specific indicators for each scenario: barter, barter with social money, mutual credits, time banking, etc. Highlight the strengths and weaknesses of each model, characterise the different contexts within which they operate.

2. Study in depth the methods of using social money, in such a way as to understand the reason for their development, their limits and possibilities of moving towards the creation of an economy of solidarity that uses the assets of this instrument, without falling to the temptation of premature centralisation. Encourage the "local" global.

3. Constantly monitor good system operation and develop a network of communication between the different experiments in existence, especially in Latin America, in order to use their advantages and avoid the malfunctioning seen in the earlier models.

4. Set up a system of further education within the local systems, in such a way as to keep open communication channels between the different experiments, within each initiative as much as in the establishment of new strategic alliances. Incorporate collective production, fair trade (with social money) and ethical consumption to training programmes. Renew the ways of resolving the tension that exists between “ individual desire”, unsatisfied through a lack of consumption, and the “drive” for the development of a model of social transformation: try to simultaneously encourage the abilities of initiative, solidarity and politics.

5. Raise again the question of voluntary work and include it in the new definition of an economy of solidarity, in which the creation of sufficient social money will be possible. Launch initiatives that attempt to find a solution to the incessant phenomenon of “ turnover because of exhaustion” of volunteers.

6. Incorporate microforms of the economy of solidarity into pre-existing networks. Identify the local experiments and develop gradual processes for setting up innovative solutions, in such a way as to make them individual to each community and sustainable for the duration.

7. Use existing Web sites and mailing lists to follow the progress of projects of common interest: www.redlases.org.ar, rgses@yahoo.egroups.com, http://money.socioeco.org , among others. Avoid duplication and dissipation of resources.

8. Define participation, in the process of communicating the experiences in Argentina and Brazil: establish material for the Economic Programme of Alphabetisation, files for beginners and trainers, videos, exercise books, manuals gathering together the best practices. New work issues: The Power of the Consumer; Advantages of Collective and Sustainable Production; Fair Trade – local and South-South; Social Capital: how to develop it in our community; Diagnostic Enquiry: social, organisational, financial and cultural. Indexes of the economy of solidarity: barter clubs and networks, LETs, SELs, Time Banks.

9. Workout projects of academic exchange between universities in order to put the economy of solidarity and innovations in money matters firmly on public and governmental agendas Support internationally, inter-government efforts aimed at promoting experiments of the economy of solidarity used in local development.

10. Broaden the proposal for a “Multinational Civil” – a hybrid system of social money and official currency. Use consumer power and the money of the system to strengthen the economy of solidarity. Create a network packed with internal flux. Create strategic alliances with the production sector. Create showcases.