07/20/98

Boost the Power of Your Dollars.

Making money is child's play. Controlling its buying power is not. My brother, while a friend watched, used to open his hand to show me a dime and a nickel. "Which one do you want?" he'd ask. "The big one," I'd say. The two of them would look at each other and smile. I sure made lots of nickels that way. Those nickels had real buying power, too. I could ride the bus anywhere in town for a nickel; McDonalds' cheeseburgers cost 15¢ and fries 10¢; and for a quarter, I could buy two movie tickets.

My friends and I were never at a loss for money. We sold homemade kleenex flowers door-to-door for a penny apiece; weeded dandelions for a penny a quart; sold Donald Duck comic books for a nickel; and babysat for twenty-five cents an hour. There were always ways to make a few bucks to pay for entertainment.

Today people throw their pennies on the sidewalk. The buying power of our money has been relentlessly eroded by the forces of inflation and greed. Since 1968 the minimum wage has tripled, from $1.68 to $5.15, while the costs of goods and services have skyrocketed by a factor of ten times or more. My follow-up visit to the doctor recently, for example, cost $90.00 for five minutes of his time. Auto mechanics charge as much as $45.00 an hour or more!

How on Earth will our children ever be able to afford to leave home and start households of their own? Enough is enough. There have to be ways for the consumer to exert pressure on the marketplace to bring costs into line with wages. I spoke with an imaginative consumer who has created one way to do it, a way which is beginning to take hold in his community.

Paul Glover lives in Ithaca, New York. About seven years ago, during a three week stay in bed to recuperate from a back injury, he dreamed up a money-making scheme to improve the local economy. It was a money-maker all right; he started printing his own money! The value of this money, called Ithaca Hours, is based on the value of labor in the Ithaca area, which averages approximately $10.00 per hour. So each Ithaca Hour bill is worth $10.00.

In the beginning, about 90 people agreed to accept Ithaca Hours as payment for services. Among them were carpenters, accountants, tutors, restaurant owners, used car dealers, and many others, each of whom received two Ithaca Hours ($20.00) to join. Since then the numbers have grown to over 1300 participants, including 300 businesses, which are all listed in the Hour Town directory. Every eight months they may apply to be paid an additional Hour as reward for continuing participation.

Consumers can exchange services through bartering arrangements or pay for goods and services with Hour bills. "More than $63,000 worth of Hours have been issued during the past seven years," Glover said, "And millions of dollars value of local trading has been added to the Grassroots National Product."

To give you an idea how it works, Mr. Glover told me about a woman who wished to return to school, but could not afford daycare for her young children. She consulted the Ithaca Money directory for childcare providers and was able to arrange a swap: childcare in exchange for tending the babysitter's gardens. If an imbalance of hours develops, she can either provide other services or pay for the childcare.

People pay rent with Hours. The best restaurants in Ithaca take them, as do movie theaters, bowling alleys, two large locally-owned grocery stores, the local hospital, many garage sales, 55 farmer's market vendors, the Chamber of Commerce and hundreds of other individuals and businesses.

As one participant notes, "Because Hours can be used both for goods and services which are not always part of the formal economy and for retail and professional transactrions, the local economy gets a boost every time Hours are earned. That's what any money is all about -- facilitating exchanges among people."

Ithacans regard Hours as real money, backed by real people, real time, real skills and tools. Dollars, by contrast, are funny money, backed no longer by gold or silver, but by less than nothing -- $5.5 trillion of national debt!

Local currency is a lot of fun, and it's legal. Hours are taxable income (based on their $10.00 per hour value) when traded for professional goods or sevices.

Ready to print Hours for your town, anyone?

Even where no local currency or bartering option is immediately available, there are other money-saving measures we can practice. If we put our ideas together, we will no longer be at the mercy of the market forces which have steadily eroded our purchasing power.

Please send questions or comments to bbruno@snet.net.