When times get tough and cash becomes strapped, many turn to bartering – trading services and goods without the pesky dollar getting in the way. Not only does bartering and exchanging time strengthen the community, but it supports the local economy.
Bartering combined with local currencies or time banking can create a synergistic system that benefits businesses, increases value in local services and exchanges, and supports a stronger, more resilient economy. While the economic slump might be forcing more focus on these resources it is their inherit strengths that will keep them a part of the community long after the recession ends.
A Return to Bartering
Bartering systems have sprung up all over the internet in the past decade. It is common for bartering to increase during recessions, but online bartering is growing in popularity even in good economic times. While money provides a great escape from the hassles of direct bartering (economists call “inefficiencies”), the Internet has helped to overcome the largest hurdle: connecting two people who have exactly what the other one wants.
Now you can go on that vacation and pay for your logging with your talents instead of the cash you don’t have, or trade that worn out guitar you never play for some much needed auto parts, all from the computer. Craiglist is easily the most famous name for buying and selling in your area and they have a large barter section as well.
Trade Away, UExchange, TrashBank, CareToTrade and FreeCycle are other great places for you to start bartering today. Even businesses can get in on the action, trading their goods and services for others on sites like BizXchange and Midwest Business Exchange.
One community in Vermont has created a “time banking” system where community members can trade their skills and resources for a time-based currency. You give me an hour of your time, I give you a Community Credit, which you can trade for an hour of another persons time. A leg up on the traditional bartering system, time banking unifies community, trade and local currency. You can create your own time banking system or find on near you at TimeBanks.org.
Local Currency for Stronger Economies
Local currencies provide a similar community service: keeping the exchange value (money) in the community. At the same time it serves to eliminate the hassles of bartering, although when used in conjunction with bartering can enhance its efficiency.
The concept of local currency is not new, in the US it made a large appearance during the Great Depression, when banks were closing and the green-back was hard to find. Local currencies were issued to keep the markets moving and businesses open. The current recession is definitely being compared to the great depression. While local currencies are on the rise now because of the economic crisis, they have been used prior to the recession with great success as well.
Probably the first local currency to resurface post-depression era was the Ithaca Hour in Ithaca, NY. A group of residents created the Ithaca hour in 1991, equalling it to $10 or one hour of work. Today the Hour has six denominations, more than $100,000 worth in circulation and provides the greatest example of local currency triumph for others. (Lambert, “Funny Money”)
And there are many others; numerous cities and communities have created local currency to be exchanged and accepted at locally-owned businesses and banks. Here is a list of some of the local currencies in use today:
- Bay Bucks – San Francisco area currency.
- Burlington Bread – Burlington, Vermont area.
- BerkSares – Western Massachusetts area currency.
- Madison Hours – Ithaca Hours inspired currency in Madison, Wisconsin.
- GLCC River Hours – Another Ithaca-inspired Hour, this time in the Columbia River Gorge area.
- Whidbey Terra – Whidbey Island Exchange bucks.
- Corvallis, Oregon has a currency as well.
Local currency is a concept many economists (both ecological and neoclassical alike) have given weight to for various reasons. E.F. Schumacher, the “radical” economist famous for Small is Beautiful and Good Work, was a large proponent of local currency. It is the Schumacher Society, founded in his honor obviously, that pioneered the BerkShares local currency.
Keep it Local
We already know that supporting the local economy is better. Small, local business are nearly three times as profitable as global corporations. Each dollar spent locally is four times as beneficial than a dollar spent in a global owned business. Why would we not support our local economies? (“The New Economy” Yes! Magazine, Summer 2009)
Onion River Exchange, Trade Away, Ithaca Hours and Berkshares are all great examples of the time banking, bartering and local currency systems. Even if you’re not feeling the tightening of your wallet, using a local currency, time banking and bartering are all great ways to contribute to your community as well as keep your money, goods and services in the local economy. It helps you to help your community, which in turn helps you back. Keep it local!