In Spain, where the European financial crisis is hitting hardest, unemployment is at a staggeringly high level: 26% overall, and nearly double that figure for young persons. Spaniards are getting creative in order to meet their daily needs. With the euro scarce, alternatives to currency are popping up everywhere. Barcelona alone has 16 Time Banks, where work normally done on a volunteer basis is performed for credits on a one-credit per hour ratio. This is especially popular with students who are able to pay tuition with credits earned.
Smaller communities have banded together and developed something more controversial: a modernized bartering system in which civic or social currencies are being created with names like the in France. Goods or services are offered to the community and can be exchanged for credits used to buy whatever might be available from the system. The system doesn’t offer big ticket purchases such as a new automobile; however, for necessities such as food and clothing it works very well and helps some Spaniards weather the financial storm better than others.
Spain isn’t the only country where the idea of local currencies is taking hold. The mayor of Bristol in the United Kingdom has asked to be paid his entire annual salary in the Bristol pound, the local currency. The Bristol Credit Union, a regulated financial institution, has begun managing electronic accounts dealing in the currency. Even some neighborhoods in Philadelphia, PA are jumping on the band wagon. The Equal Dollar bears the image of its creator, community leader Maggie Kuhn.
The local currency is not a new concept. The thaler (the origin of the “dollar” moniker) was used throughout the Holy Roman Empire for hundreds of years. Each municipality with a local silver mine minted its own coins that took on the name of that mine. The value of one municipality’s thaler could differ widely from another, based on the purity of the silver being minted and the weight of the coin.
However, not all is as idyllic as it might seem in the world of local currency. Where 16th century counter-fitters could exchange debased coins for currency of pure silver, the danger of tech savvy ne’er-do-wells creating accounts and filling them with the local Eco or Sol is all too real.
Who knows whether this is just a fad or if it is the key to bucking up the finances for out-of-work individuals. The greenback isn’t going anywhere anytime soon, but it’s apparent these localized currencies have revitalized communities across the globe, proving that creativity and adaptability can keep the heat on and the kids fed.