Burlington Currency Project Vision
Please note: The following excerpt was taken from the original website which ceased operation in 2007. This website pays homage to a currency that was.
We envision a network of local currencies throughout Vermont connected through an electronic mutual credit clearing system(which is a system which allows its users to issue and manage their own money within a community network which provides the forum for trading) where businesses in Rutland or Montpelier or Brattleboro could accept their own local currency from their customers, deposit it in the electronic system, and then use that electronic system to order goods from their suppliers from other parts of the state. We envision a system to encourage informal care services which tracks hours of volunteerism (called a “Time Dollars” system currently operating in thousands of communities in 22 countries) so that a high school student who “deposits” an hour mowing a neighbor’s lawn over the summer can “withdraw” an hour’s worth of tutoring at exam time. We envision the community frequently using the currency to create 0% interest loans in order to fund projects and entrepreneurial ventures and make the repayment easier than bank loans in dollars which charge interest.
We believe that in order to have a significant impact on the community,
we need to dream big. We will not believe that we have arrived until 10% of all Vermont’s business transactions are conducted with local currencies and all businesses use it, until city governments accept a portion of their property tax payments in local currencies and pay a portion of their employees wages with it, and until it has become so ingrained in the local culture that citizens don’t think twice about it and tourists come to experience it.
In a 2001 report entitled “The Leaky Bucket: An Analysis of Vermont’s Dependence on Imports” Doug Hoffer and Ellen Kahler found that Vermont had a significant trade deficit – it imported $14.6 billion in commodities and produced $9 billion in goods. Approximately $3.5 billion of its goods stayed in the state and $5.5 billion was exported, leaving an approximate $9 billion trade deficit, four times its annual tourist revenues. Looking at food production in particular, the US Census Bureau shows that Vermont produced $1.23 billion, but imported $1.81 billion, 47% higher. Only $445 million of Vermont’s food production was non-dairy.
The report went on to find that if Vermont were to switch 10% of its consumption of food from those produced out of state, to those grown in state, it would lead to a $376 million boost to the state economy andcreate 3,616 new jobs. This is a significant impact that the use of local currencies can help to create. This is why we are focusing the electronic mutual credit clearing system.
Short and Long Term Strategy
We believe that, in order to have the impact that we envision, we need to create a statewide electronic system for tracking credits and debits. In order to make the local currency a viable option for Vermonters, we must eventually bring on large institutions such as respected businesses, local governments, hospitals, colleges and universities, and utilities simply because they are the large employers and the largest provider of services where Vermonters spend their money.
In order for these large groups to easily use a local currency, it must have a component other than paper currency just like our current national monetary system. Large scale transactions from business to business will take place through electronic funds transfer or by electronic transactions.
Our long term strategy (5-10 years) is to build an electronic system that can handle an extremely large number of transactions and to assist the creation of strong, interconnected regional paper currencies throughout Vermont.
In order to grow to a scale where such a future is possible, we plan to focus in the immediate term (1-5 years) on the ways in which local currencies can aid local food production and sales. One weakness common to almost all local currencies and apparent throughout Burlington Bread’s short history is that the currencies are frequently only accepted by “luxury good” providers: A hardware store owner would not by likely to accept it from his customers because he could not use it to pay his supplies or employees. But if it were possible for people to buy necessities with the currencies, especially food, then a lot more businesses would begin accepting it.
Our short term goal (1 year) is to research and decide on a software platform for the electronic system, gather design feedback from potential users and launch the system. At the same time, we need to create a business and revenue model so that the organization is sustainable and secure initial start-up funding.
We recognize that this is in all likelihood a very new idea to you and that even if you have found yourself nodding and agreeing as you read, you have many questions. How will local currencies interact with the dollar? Is this even legal? How does this affect my taxes?
We need your support in achieving this vision. Will you join us?