Just my opinion. If you create a community currency, impose demurrage, and make it work in our more instant gratification culture, I’m willing to adjust based on your success.

Money has been defined as having 3 functions: a unit of value, a medium of exchange, and a store of value. The last 2 functions have contradictory effects in how the money flows thru society & we need a currency that favors “medium of exchange” and will continue to function during downturns like this one. Having a currency designed specifically to address the function of ‘medium of exchange’ is an important part of the ecology of healthy economic exchange. One good example is the CHIEMGAUER (http://www.ijccr.net/IJCCR​/2009_%2813%29_files/IJCCR​vol13%282009%29pp61-75Gell​eri.pdf) in Austria, which is a demurrage currency having a small ‘holding fee’ attached to boost the velocity of the money. If local governments issued demurrage currencies to fund the local bond issues people vote for, then they could spend the currency into circulation on the social infrastructure like teachers, police and fire departments. This democratizes the credit commons as Thomas Greco recommends (rather than borrowing dollars at interest). During the last depression this was tried very successfully in Worgl (see minute 2 of this 4 minute video http://www.youtube.com/wat​ch?v=hxdPIOUTd2k).

Money is a great invention – but our role in society changed when we evolved from an agrarian culture into modern urban life. With mass production of products and ever denser populations it’s no longer possible for individuals to make most of the things required to survive in an urban environment. Economists have been clear about the value of this ‘specialization of skills & knowledge’ on the increased wealth in our society. But there has not been a fair bargain made for all the people who forfeit their self sufficiency to live in this interdependent culture. This is the reason that billions of dollars are paid to the financial leaders who make the investment instruments that take the world to the brink of collapse while the skilled tradesmen are a dying breed.

I disagree with Paul Glover’s comment about demurrage currency above.
Demurrage currencies promote long term thinking by imposing the same ‘storage fee on currency’ that real assets have. Positive interest rate amounts to preferring short term gains since returns on long term projects are exponentially discounted to present value. Demurrage currencies have the opposite effect, it’s much more profitable to spend them on productive long term projects.

See

http://www.policyinnovations.org/ideas/innovations/data/000085

My approach would be to create an open ‘Oakland Society’ as a voluntary unincorporated association or ‘club’, based upon a very simple statement of principles and purpose.

The ID card would simply be the membership card of the Oakland Society.

A core function, and attraction, of the Oakland Society would be – for anyone who wishes to participate – as a ‘Guarantee Society’ (GS). How this works is that the members of a GS provide a collective guarantee of bilateral ‘Peer to Peer’ credit aka ‘time to pay’ both business to business (B2B) but also for business to customer (B2C) credit.

This credit is interest free, but not cost free, and it takes place within the framework of trust provided by the GS agreement.

How it works is that both seller and buyer on credit terms pay an amount (which may look like interest, but isn’t, because it’s for the use of the guarantee service, not the use of money) into a default pool fund held in common by a custodian. A service-provider-formerly-known-as-a-bank manages the system; sets guarantee limits; and handles defaults in accordance with GS policies. Credit may be settled in dollars, or – more to the point – in ‘dollars’ worth’ of goods and services, or of other value eg units redeemable in energy or units redeemable in land rental value. All transactions are priced in dollars, even though they may not all be settled in dollars.

The service provider is paid his costs, and a (default) performance related bonus, and any excess after meeting default charges is distributed as a dividend to all GS members so that those who are supporting the guarantee but not actually using it are compensated.

Using this simple P2P credit architecture – which is implementable tomorrow, consensually, with no change in any law – the credit necessary for the circulation in Oakland of goods and services and the creation of productive assets may be created. Oakland credit is of course not based upon rapidly shrinking bank balance sheets, but rather upon the full faith of members of the Oakland Society. Banks would queue up to provide the service, because their capital requirement is minimal.

Direct ‘Peer to Peer’ investment in new or existing Oakland property and energy assets – using a ‘Capital Partnership’ approach to unitise rental value and energy value – is another function which may be achieved between members of the Oakland Society. The outcome is essentially an Oakland Equity – just not equity as we know it – which would come to replace outstanding Oakland debt, particularly property debt.

See

http://www.slideshare.net/ChrisJCook/money-30

and

http://www.slideshare.net/ChrisJCook/economic-systems-thinking230710

Happy to participate in the upcoming web event