Date:Sat, 30 Mar 2002 PEI Guardian
Subject:more taxes?!? how about more money??

Editor,
Re the recent PEI and Saskatchewan budgets (not to mention a host of others, past present and, no doubt, future):
How original! Raise taxes on cigarettes and gas, and cut programs! Wouldn’t it be nice for a change if somebody somewhere in this great country could figure out and implement some policies that would actually help the people rather than continually trample on them?

Let me offer a suggestion.

We have no money (have we heard this before?)! say our fearless leaders. Well - you’re the government, why don’t you do something creative about it rather than whining all the time (all those big salary increases for MPs, MLAs, etc were supposed to be to see that we got quality people running for office - and the best they can come up with is raise taxes and lay people off? Geez!)? Specifically - how about making some money, rather than begging the banks or Ottawa for it, two options which are fraught with danger, as we all know?

Yes - we can, literally, make our own money. There are many systems in use today which use one form or another of Local Currency to get around the debt-trap of borrowing from commercial lenders at usuric rates of interest, which only gets one in a hole which gets deeper and deeper, as we all well know - we’ve been hearing about it long enough. But it is entirely feasible, possible and fiscally safe to create a local currency which will provide money for jobs, and money to circulate in the local economy, supporting many people who have skills to offer but can find no work in the local job market.

Think about this five-step program:
1) The PEI Government establishes a PEI-LETS Dollar (LETS stands for Local Exchange Trading System - this is a long-established system working in thousands of communities worldwide, and working well - other equally well-established alternatives are available)
2) At the same time, a Business License Requirement is enacted, which says that any business operating in PEI is required to accept such PEI-LETS Dollars for a minimum of, say, 25% of any financial transaction enacted on PEI, goods or services, as the purchaser wishes
3) To get the system underway, to kick-start it, as it were, the government issues each and every Islander over the age of 16 years 1,000 PEI-LETS Dollars (just tell me why this can’t be done)
4) Instead of laying off government employees, the government immediately makes all government salaries payable in 50% Canadian (debt-based) currency, and 50% PEI-LETS (debt-free!) dollars - LETS currency will be coming in to the government in normal government fees and taxes, which will also be payable in LETS currency; a committee of Participatory Economists is struck to establish a non-inflationary rate of currency-issuing (i.e. anyone who has a traditional economics degree or any connection with the modern banking system is not eligible - our current mess is the result of decades of their policies, and it’s not wise to get advice from the fox on securing the chicken coop); any contractor providing services to the government will be required to accept a minimum of 25% of their fees in LETS $$
5) The Government makes available interest-free loans of up to, say, $50,000 PEI-LETS $$ to anyone with a decent business plan, subject to nomal guarantees etc - on the understanding that such new businesses accept (at least) 50% of their fee-for-services/goods, and new employees also accept 50% of their salaries, in PEI $$

Sure there will be some details to iron out, and a few startup problems (and undoubtedly a considerable amount of obstructionism from banks and others who benefit greatly from the current system) - but think of it! - many good things ensue, nothing bad. ‘Bank-money’ is freed up to pay off those debilitating bank loans (and Sin No More With Debt-Based Money! shall be the new motto for government finances!), more money is in circulation, providing more jobs for more people, unemployment and seasonal work shortages can be reduced by a substantial percentage, the food banks can close down, the Island economy will be become much more self-sufficient in basic necessities such as food, etc etc.

It is a win-win-win situation for almost everybody - your average bank won’t be that supportive of it, for obvious reasons - they tend to get upset when their government-mandated cash-cows get attacked, and the unearned usury of the banks is one of the shibboleths of modern society - which is also why one should not pay much attention to their protests that such schemes are impractical or impossible or illegal or inflationary or whatever. Nor should we listen much to MNCs, who will undoubtedly complain loudly as local businesses take away some of their profits, who also have a serious interest in preventing local currency, as they ship large amounts of profit back to head offices overseas, where local currency wouldn’t be much good - but hey! - isn’t that good for us? If MacD****’s or XFC demand $4 Canadian for a sawdusty hamburger or piece of chicken, but Bob & Judy’s Borden Burgers will accept a buck Cdn and a buck local currency (or even all local) for an admittedly superior burger or chicken leg, well, their business should increase - and Bob and Judy, as Islanders, ain’t shipping lots of money off-shore to Franchise Central in Philly or wherever, so it stays here and continues to work around the Island - Bob takes his PEI-LETS bucks, and goes down to Gallant’s garage to fix his car - and Ivan takes half his pay in PEI bucks - and pays his new help with the same currency. How can that be a bad idea (for us anyway)?) More money, better government services (we can afford to employ more people!), less unemployment, lower taxes on PEI bucks, etc and etc!!

Obviously there are a number of details to be taken care of, but such systems are and have been operating in hundreds of communities all over the world for over 20 years, with great success, and all major bugs have been worked out. About the only thing stopping it from happening here (or anywhere) is political will. (The bank-money-controlled political will that says when we want to do something that screws the people, we can do it basically overnight (how long did the (public) debate last about tax increases on gas or cigs or the layoffs?!?) - but something to help the people?!?! oh my!! that will take extended studies for years!! - but, as smarter people than I have said - it don’t have to be that way.) Local currencies empower local people - bank-created debt-money empowers banks. Which would you rather have - empowered banks or empowered people?

Oh well - just another candle in the wind, an idea that is probably far too practical and useful for our governments to pay attention to. But one day, maybe, just one day.... (for those that are interested in learning more, check out the Net - and for an eye-opening case study, run down the situation of Guernsey Island, which was in very dire financial straights a century or so ago, until they came up with the idea of a local currency....).