Fiscal Localism on Rise Worldwide

Spain town reintroduces peseta to boost economy
BBC News, Madrid

A small town in northern Spain has decided to reintroduce the old Spanish currency – the peseta – alongside the euro to give the local economy a lift.
Shopkeepers in Mugardos want anyone with forgotten stashes of the old cash at home to come and spend it…
More than 60 shops in Mugardos, a small fishing town in Galicia on Spain’s northern coast, are accepting the peseta again for all purchases, alongside the euro.
It is an attempt to get cash registers ringing – and help lift the town out of a long and painful economic slump.
Shopkeepers were sceptical at first, but they now say the scheme is a great success.

Currency bill backers want alternative to ‘paper dollar’
The Salt Lake Tribune

Larry Hilton, a local attorney and supporter of the “sound money movement,” said that “un-backed money” created by the Federal Reserve to stimulate the economy, is “hanging over us like the sword of Damocles waiting to just come down in an avalanche and destroy the value of our currency.”
While the bill says the use of gold and silver coin as currency would be voluntary, it requires the Legislature to study the “possibility of establishing an alternative form of legal tender,” and to come up with further recommendations for the 2012 session.

Fiscal Localism On Rise In Germany
National Public Radio

The Havelbluete, the Augusta and the Chiemgauer might sound like the names of locally brewed beers, but they are in fact micro-currencies which, like micro-breweries, are in abundance in Germany. There are more than two dozen local currencies in circulation, and 40 or so initiatives are about to start printing their own banknotes. These notes are not gimmicks….

Germans take pride in local money
BBC News/Magdeburg, Germany

The next time you venture out for lunch in Magdeburg, check what kind of loose change you have in your wallet.

The local banknotes are issued at a rate of 1:1 to the euro

Like any other city in Germany, the normal currency here is the euro. But bizarrely, they also have another currency in circulation: the Urstromtaler.

Before you doubt its existence, it is not “Monopoly” money – it is very real. At a jewellery shop in the city centre, Gerfried Kliems explained how people use the regional currency.

“It’s quite simple,” he said. “The money you spend stays in the region. When I accept Urstromtaler in my shop, I then have to see how I can spend the local banknotes. You get to know everyone who’s participating in this project, and at the end of the day, you have a good feeling about life.”

More than 200 businesses are using the regional currency, including shops, bakeries, florists, restaurants. There is even a cinema which accepts Urstromtaler.

Germany’s Local CurrenciesEconomic Cure or Fool’s Gold?

Der Spiegel

How many currencies does Germany have? More than one, it turns out. In an effort to boost their local economies, 22 regions in the country have introduced their own alternative tender — but are they worth the paper they’re printed on?

At some point in the spring of 2004, the money ran out in the village of Güsen in the eastern German state of Saxony-Anhalt. At least, Frank Jansky wasn’t receiving any. “People couldn’t pay their bills anymore,” says Jansky, who runs a lawyer’s office in Güsen, where he represents mainly tradesmen and small construction firms.

Around that time, Jansky heard about regional currencies and thought: “That’s it.” His idea: Instead of using euros, eastern Germany’s increasingly pauperized population ought to be able to pay in goods and services. The regional currency would be known as the “Urstromtaler” (the name is a play on words, combining “Urstromtal,” the name of a Saxony-Anhalt valley, with “taler,” the name of an old German currency — which incidentally also inspired the name “dollar”).

Struggling US towns print their own currency
If you’re fresh out of dollars, perhaps a Detroit Cheer, Bay Back or BerkShare will do.
Daily Telegraph/New York

Communities across America are bypassing the dollar and creating their own currencies in an attempt to help both consumers and businesses struggling in the recession.
The idea, borrowed from the Depression era when the currencies were known as “scrip”, is designed to boost local spending and keep money circulating within the community.
Typically, a group of businesses print a new currency which shoppers can then buy at a discount – typically one dollar will cost 90 to 95 cents – and spend at full value with participating companies.

Some of the currencies have been around for years but the recent economic downturn has encouraged others to follow suit. According to some estimates, there are now more than 75 local currency systems across the country.

Others include the Ithaca Hours in upstate New York and the Plenty in North Carolina.

Under US law, small communities can produce their own currency so long as it does not include coins and does not resemble federally-issued money.

The currencies are not a tax dodge as the income to participating businesses is liable to tax…

Americans are not alone in creating their own currencies to cope with the credit crunch. Lewes, the famously independent-minded county town of East Sussex, created its own pound last year. There are now 31,000 Lewes pounds in circulation and more than 130 traders accepting them.

In the German city of Magdeburg, more than 200 businesses accept the Urstromtaler, one of an estimated 16 regional currencies in the country.

From Stalwart To Skeptic, Germany Rethinks EU Role

National Public Radio

The financial calamity of the European Union’s sovereign debt woes has shaken the pillars of the postwar ideal of a united Europe. The debt crisis and the global downturn have left many European countries looking inward these days and viewing Brussels as increasingly irrelevant.

Germany, long a postwar champion and financier of European integration, is flexing its muscles more independently. And more of its citizens are questioning the country’s leading role in the European project.

On a recent day, Christian Gelleri buys a sandwich and a glass of Hefeweizen at a rustic, sun-filled outdoor beer garden along the Inn River in the Upper Bavarian town of Stefanskirchen.

But the 40-year-old isn’t paying with euros. The bar also accepts chiemgauer, the thriving local currency named after a region in Bavaria.

A Euro Substitute?

The alternative currency is not some gimmicky fundraiser. It may look a little like Monopoly money, but the chiemgauer is real. One chiemgauer equals one euro. It’s been around for eight years, almost as long as the euro, the common currency now used by 16 of the 27 EU members.

Gelleri, a high school teacher who established the chiemgauer, is proud that more than 600 regional businesses — from drugstores to architects — now  accept the microcurrency.

“The chiemgauer is connected to the region. You can’t speculate with it, you can’t buy stocks or options or shares with it,” he says.

In other words, you can only spend it in the area. Organizers insist the currency is meant to promote a “buy local” mentality and is a complement to the euro. The chiemgauer is not backed by federal or local governments, though some banks are offering loans and checking accounts in the currency.

But the fact that there are more than two dozen regional currencies like this in Germany — the most anywhere in the world — underscores the German ambivalence toward the euro.

Adoption of the euro was supposed to lead to a deeper, more coherent fiscal and political union. But the single currency hasn’t really delivered on either.

And intended or not, the microcurrency trend plays into German nostalgia for the deutsche mark, the national currency that the euro replaced.

“The existence of the chiemgauer and some two dozen other regional currencies in Germany underscores the country’s ambivalence toward the euro.”

This entry was posted in Civil Disobedience, Economy, Euro / Sovereign Money, Independence/Nationalism, Solutions and tagged , , , , . Bookmark the permalink.

One Response to Fiscal Localism on Rise Worldwide

  1. Pingback: Guest Post: Reestablishing Ireland’s National Currency |

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