Monday, February 26, 2007

Why I Love Funny Money - Or How You Can Engage the Local Community to Stick it to Big Brotha

A friend sends this interesting article about a local currency in some town in Massachussetts called "Berkshares."

"Inventor" Susan Witt explains it thusly:

"The Berkshares are pretty simple to operate," she said. "You walk into a local bank, put down $90 federal and get 100 Berkshares, and then those Berkshares are spent at full value at regional stores."

How the "regional stores" absorb the 10% discout rate (some of which the issuing banks and Susan Witt presumably skim off the top) isn't really explained in the article. Which leads me to think that this is really just a(n admittedly very clever) local shakedown operation - not unlike the way some towns and states turn a covert profit by hitting up passers-through for exorbitant speeding ticket fines. The way it would work is this: local businesses would have to raise prices slightly - and of course, prices are kept in federal dollars. Anyone paying in Bershares already has a 10% discount - so as long as the compensatory price increase is less than 10%, the stores make up their losses even as they placate loyal local shoppers (by saving them a bit over the long run). Berkshares operate essentially like coupons to protect locals from the price hike, and outsiders foot the bill in its entirety.

"We want to encourage everybody to do their business locally rather than going to a mall or shopping online," said Sharon Palma, executive director of the Southern Berkshire Chamber of Commerce. "Using Berkshares, you have to do business locally, and the other really nice piece of that is it's face-to-face business."

And for this purpose, it's probably a good idea. I seriously doubt, of course, that the 10% discount is really enough to make up for the difference between local and online sticker prices - but once you figure in shipping and handling and also a general local preference for dealing with their own, I'm guessing it works. They claim to have printed over $800,000 worth of these things, after all.

But there's another alternative currency - the Liberty Dollar - that probably has over $20million in circulation. Unlike "Berkshares," however, the Liberty Dollar gets mostly bad press. (Here is another US Mint link actually claiming that circulation of Liberty Dollars is criminal.)

So what's the huge difference that makes Liberty Dollars "criminal" and Berkshares ABC's best buddy? Simple: Liberty Dollars are backed not by greenbacks but by commodities. In other words, Liberty Dollars are a stand-in for a government-independent barter economy, whereas Berkshares are essentially just an alternative notation of the official federal currency (actually, they're handshake-wink-wink local discount coupons, but never mind).

Now, in a sane world, BigGuv would have a problem with the latter and not the former.

After years of planning, Witt started printing her own money and spending it around town.

She is not a counterfeiter.

Ah, but in one sense she is, because her money is really just an alternative printing of dollars. There is nothing stopping her from overprinting her bills and trading them back in at the bank. Now don't get me wrong - I'm not advocating her arrest. Quite the contrary - more power to her! What annoys me is that BigGuv gets this so (deliberately) backward.

The truth is that neither the makers of Liberty Dollars nor Susan Witt are counterfeiters, but the government is looking for an excuse to bust up Liberty Dollars and not Berkshares. I can only believe that this is because Liberty Dollars are, in fact, real money, and the government knows it.

Consider - if Liberty Dollars went into general circulation and became a real competitor to the US Dollar (at least in the US), then the government would lose a lot of the power that it currently has to regulate the economy. It would, among other things, no longer be able to play with the inflation rate, the exchange rate, or the national lending rate (interest rates) - and I suspect, but can't prove, that this would also mean that insiders couldn't vote themselves clandestine profits as needed. But of course with Berkshares there is no such danger - since they depend on the continued existence of the national currency.

Conclusion: this is reason approximately 6,375 why the federal government SUCKS DONKEY BALLS and is made up of a bunch of JACKBOOTED FASCIST PRICKS and needs to LEAVE US THE HELL ALONE and let us RUN OUR OWN LIVES.

If people get together and work out a way to have solid money - so that they actually get to keep the portion of what they earn that the government doesn't steal in taxes to pay for crap like welfare, misguided national health insurance plans (please, NO!!!!), public funding for the arts (can ANYONE explain to me why this is a FEDERAL funding item????), etc. without losing it to government-caused (because there is no other kind) price inflation, then damnit they should be allowed to do so!

So - best of luck to the people running the clever Berkshares local shakedown operation. Not because I support their covert "foreigner tax" (indeed, thanks to this story I will never visit their region so as not to support their pricing fraud), but because if they can do it with impunity, the government has a harder time making its case against Liberty Dollars.

Thanks for the push, suckas!


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