Sustainable living: Local dollars could create a sustainable economy

Pull out a dollar bill and take a good look at it. We all know what it can buy. But what is the paper bill actually worth? It probably cost a few cents to make, but while it’s not very useful on its own, we value the dollar because we all agree that it has value.
It’s what we call a fiat currency, meaning it no longer can be redeemed for gold and has no inherent value, apart from a shared belief that it is, in fact, money.
Much of its value is backed by foreign investment in U.S. debt. But that’s changing, proving the vulnerability of a global economy built around speculation and credit. It’s an unsustainable system that holds local communities hostage to global events and decisions beyond our control.
New Earth Exchange, a Soquel-based grassroots organization, believes a local currency is one viable solution. Group organizer Langdon Roberts explained his motivation behind the forthcoming launch of the group’s GoLocal Santa Cruz program at a recent presentation:
“We started looking at how the U.S. economy really worked, and it’s scary. Our goal is to build a sustainable model here in Santa Cruz County,” said Roberts, director of the Center for Transformative Neurological Physiology.
GoLocal would function as a countywide rewards program for participating local businesses, with the goal of driving more traffic to such businesses while providing incentives to customers. Luckily, the model has already proven successful in Northern California.
GoLocal Sonoma founder Derek Huntington, who also recently spoke in Santa Cruz, discussed how shopping locally creates what is called the “economic multiplier effect.” That means money spent at a local business, versus a nationwide corporate entity, results in more of that money staying in the community through local job creation, local investment, and so on.
With that in mind, he set out to create a system through which Sonoma businesses could offer “rewards” each time someone makes a purchase. Think of it as an Ace Hardware card that can be used at local businesses all across the county.
Business owners pay a nominal fee, proportionate to their business’ size, and are issued a certain number of credits to be used as they see fit. Customers pay about $10 annually to enroll and earn rewards — or, if you will, local dollars — each time they buy something from a local purveyor. This initial buy-in comes back pretty quickly for all parties involved — consumers receive rewards that can be used like cash, and local businesses draw more customers.
GoLocal Santa Cruz will start with a counterfeit-proof paper version of the rewards in order to better accommodate microbusinesses, which make up a large proportion of the area’s local businesses, before moving to a card-based system.
Santa Cruz County businesses interested in getting involved can go to www.newearthexchange.org. Local artists interested in leaving their creative mark on the new currency are encouraged to participate in a countywide design contest.
This could really grow into a true, standalone local currency; but its success depends on countywide adoption, so let’s spread the word!
Steve Tanner is a writer and journalist living in Ben Lomond with his wife, young daughter, dog and four hens. He is on the steering committee for Transition San Lorenzo Valley, a local nonprofit committed to creating a more sustainable and resilient community. For information: www.transitionslv.org.
Get involved:
*Transition SLV will screen “The End of Suburbia: Oil Depletion and the Collapse of the American Dream” on at 7 p.m. Nov. 5 at The Satellite in downtown Felton. Suggested donation is $5, but no one will be turned away for lack of money.
*Santa Cruz Red Cross will host a Resiliency-Sustainable Skills Workshop from 10 a.m. to 1 p.m. Nov. 14 in Soquel. For information: www.sccredcross.org.