The world has gone through many periods of economic crisis, from the Great Depression until now, the midst of a worldwide economic downturn and the Euro crisis. As many times as we have globally experienced these economic woes, never once has there been innovative, preventative change implemented into a monetary system. At a TedX Talk in Flanders, visionary economist Bernard Lietaer challenged the audience to consider common misconceptions about money, and explored the innovative solution of complementary currencies.
Lietaer's idea centers around the misconception of what money is. We define money by its functions: a medium of exchange, a store of value, etc. Lietaer notes if we had called transportation "horses," we never would have been challenged to come up with new forms of transportation. Because we call money "money," few think about alternatives. However, thinking about alternatives to money is imperative to fixing the world's chronic economic struggles. Money is nothing more than an agreement amongst peoples to be a medium of exchange; therefore, anything can be used as money, hence the idea of complementary currencies.
Complementary currencies are not meant to replace "money" as we know it, but rather to function alongside of it. Our current form of money would still be used for international and national exchanges, but complementary currencies would be used for local exchanges.
A complementary currency system in place now uses Torekes, implemented in the poorest area of Flanders. When asked about their goals and dreams, members of this community expressed desires for gardens, which they couldn't have in their highrise apartment buildings. Torekes were created. A large plot of land was set aside for gardening, and residents can pay their rent for a garden plot with Torekes. They can earn Torekes by planting flowers in their windowsill or picking up trash and cleaning in their neighborhood. The institution of Torekes has solved two problems. The community is able to get what they wanted, gardens, and in the process, have an incentive to clean and spruce up their low-income neighborhood surroundings. This would not have been possible with anything but a local, complementary currency.
If we intend to prevent future economic crises rather than barrel towards them, having more than one single currency is key. Complementary currencies could help a host of countries in economic trouble if they were to be used widely.
Image by Philip Taylor PT, courtesy of Creative Commons licensing.