Sacred Economics: Local and Complementary Currency

The following is the sixteenth installment from Sacred Economics: Money, Gift, and Society in the Age of Transition, available from EVOLVER EDITIONS/North Atlantic Books. You can read the Introduction here, and visit the Sacred Economics homepage here.

Berkshare local currency

Charles Eisenstein
Reality Sandwich

A proper community, we should remember also, is a commonwealth: a place, a resource, an economy. It answers the needs, practical as well as social and spiritual, of its members-among them the need to need one another. The answer to the present alignment of political power with wealth is the restoration of the identity of community and economy. –Wendell Berry

A sacred way of life connects us to the people and places around us. That means that a sacred economy must be in large part a local economy, in which we have multidimensional, personal relationships with the land and people who meet our needs, and whose needs we meet in turn. Otherwise we suffer a divide between the social and the material, in which our social relationships lack substance, and in which our economic relationships are impersonal. It is inevitable, when we purchase generic services from distant strangers and standardized products from distant lands, that we feel a loss of connection, an alienation, and a sense that we, like the things we buy, are replaceable. To the extent that what we provide is standard and impersonal, we are replaceable.

One of the effects of a homogeneous national or global currency is the homogenization of culture. As the money realm expands to include more and more of material and social life, our materials and relationships become standardized commodities, the same everywhere that money can reach. Nowhere is this more evident than in the United States, the “landscape of the exit ramp,” where the same stores, same restaurants, and same architecture dominate every locale. And everywhere we are the same employees and consumers, living in thrall to distant economic powers. Local distinctiveness, autonomy, and economic opportunity disappear. Business profits are sucked away to distant corporate headquarters and ultimately to Wall Street. Instead of vibrant, economically diverse communities with their own local character, we have a monoculture where every place is the same.

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The money system described so far in this book removes many of the barriers to local economic sovereignty and weakens the pressure toward globalization. Here are three ways:

1. Much global trade is only economic because of hidden social and ecological subsidies, which would be eliminated by the internalization of costs.

2. Commons-backed currency relocalizes economic power since many of the commons are local or bioregional in nature.

3. Negative-interest money removes the pressure to maintain growth through the conversion of the unique, local relationships and natural wealth of other lands into commodities. Ultimately, local difference stands in the way of commoditization and therefore of growth.

However, because the habits and infrastructure of local economy have largely disappeared, additional measures are necessary to rebuild community-based, place-based economies. This chapter discusses one of these measures: the localization of money itself.

I am not advocating the abandonment of global trade. While many things that should be local, such as food, have become global, there are many realms of collective human creativity that by their nature require a global coordination of labor. Moreover, economists’ doctrines of efficiency of scale and comparative advantage (that some places and cultures are better suited to certain kinds of production) are not entirely without basis.1 In general, though, sacred economics will induce the local sourcing of many commodities that are shipped across oceans and continents today.

While the changes described thus far make globalization less economic, my affinity for local economy is not primarily motivated by economic logic: the maximization of some measurable quantum of well-being. It comes rather from a longing for community. The threads of community are of two types: gift and story, warp and woof. In short, a strong community weaves together social and economic ties. The people we depend on, and who depend on us, are the same people whom we know and who know us. It is just that simple. The same goes for the broader community of all beings: the land and its ecosystems. Lacking community, we suffer a painful deficit of being, for it is these multidimensional ties that define who we are and expand us beyond the miserable, lonely, separate ego, the “bubble of psychology in a prison of flesh.” We yearn to restore our lost connections, our lost being.

Local economy reverses the millennia-long trend toward the homogenization of culture and connects us to the people and places we see every day. More than fulfilling the longing for community, it also benefits society and the environment. Not only does it entail less energy consumption, it also makes the social and ecological consequences of economic decisions harder to ignore. Today, indeed, it is quite easy to pretend that our economic decisions have no consequences. The things we use with little thought are part and parcel of birth defects in Chinese cities, strip-mining of West Virginia mountains, and the desertification of previously lush regions. But these effects are distant, reaching us only as pixels on a TV screen. Quite naturally, we live as if they weren’t happening. If the people who grow your food and make your stuff live in Haiti or China or Pakistan, then their well-being or suffering is invisible. If they live nearby, you can still exploit them perhaps, but you can’t easily avoid knowing it. Local economy faces us with the consequences of our actions, tightening the circle of karma and fostering a sense of self that includes others. Local economy is therefore aligned with the deep spiritual shift of our time.

Read Full Excerpt Here

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