Doug Rushkoff on DIY currencies

Discuss

62 Responses to “Doug Rushkoff on DIY currencies”

  1. tardigrade says:

    LETS has been around in the UK for a while – only used on a small scale though.
    http://www.letslinkuk.net/home/theory.htm

  2. KingofthePaupers says:

    “What’s needed is an open standard and protocol for exchanging between these currencies.”

    Jct: The UNILETS Time Standard of Money has already been endorsed in the Millennium Declaration. See my own home-made timebank account at http://johnturmel.com/unilets.htm
    Rudimentary but the algorithm is applicable to many platforms. I tried a yahoogroup where my credits sent out in acknowledgment were registered on my group and on the earner account.
    And an Hour of unskilled labor cannot be fudged and allows a free market to determine how many Hours you can command for your hour.

  3. KingofthePaupers says:

    “the temptation to print yourself rich becomes too much for the owners of the printing presses to resist. Digital cash just makes it easier.”

    Jct: There is no temptation when everyone is watching. It has never happened in any LETS that unauthorized credits were transfered into your account without someone else authorizing that payment. Imagining problems where problems cannot exist.

  4. KingofthePaupers says:

    “”The classic method of preventing this is to tie money to labor by way of metals dug out of the earth.”

    Jct: The new method of preventing this is to tie money to labor by way of time acknowledged at work. The LETS software needs no yellow rock to operate optimally.

  5. Billy Blight says:

    Reminds me of Argentina and their recent economic collapse. There was a period of everyone printing their own shit. Surprise! It made things worse. Who’d a-thunk?

  6. andyhavens says:

    @SamSam: Well played, sir (opera claps).A whiskey-based economy is also going to be inherently more liquid.

    Also… to those who do not trust the Fed… if the US dollar is such a crummy idea, why is it that so many other countries peg their currency to it?

    Just because you can’t trust someone doesn’t make them unreliable… it just makes them predictably corrupt. Which is better (in many cases) than unpredictably uncorrupt. That is, I’d often trust my money to a lawful/evil character than a chaotic/good one. He may try to f’ me over if it’s in his best interests, but he won’t sell my donkey for magic beans and try to pay me back his loan in hugs and rainbows.

  7. Flitere says:

    He sees a future that has people literally reprogramming their economic systems…

    No kidding? I just saw a decade and a half of that. The beta versions were rough, but the vaporware was the real killer.

    Money is an insanely complex interdependent shared system. I’m happy to have Doug Rushkoff speculating about the monetary system, but I don’t want to see the system itself subjected to “do it fast, see if it works, change it if it doesn’t” experimentation.

    Srsly, had enough of that.

  8. Anonymous says:

    What are the implications/solutions concerning counterfeiting?

  9. dalziel_86 says:

    I love how when it’s about information, BoingBoing wants open, universal systems. Don’t use this e-mail client, this DRM scheme, this operating system, or your information is locked into this one form!

    As soon as it’s about money, which is just information really, BoingBoing loves the idea of a billion closed systems with no guarantees of interaction or transferability.

  10. KingofthePaupers says:

    “But if it’s based on the labor, then would you also get the same benefit if you had a perfect way to get a non-counterfeitable currency out of jumping jacks?”

    Jct: Transparent internet credits cannot be counterfeited. As for physical tokens of time, King Henry I solved counterfeiting the Kings Chips with Tallies:

    From my http://johnturmel.com/poembank.htm

    The record most successful case was in the British Isle,
    Where “Tallies,” sticks of money, left King Henry I with smile.
    Accountants in the Treasury would split the stick in two,
    One half would be the money and the other half its due.
    A tally worth a pound of gold to pay the King’s expense,
    The other half amounted to taxation that made sense.
    The tax collectors through the land all had an easy way,
    Since people had their tallies and enough the tax to pay.
    The tallies funded projects and could pay for everything,
    With tallies matching tax, a hero, Henry I, their King.
    For over 700 years, the tallies were in use,
    But having lost control of money now is Crown’s excuse.

    Jct: So counterfeiting is no problem when we use ecredits or split popsicle sticks as our tokens.

  11. KingofthePaupers says:

    “There’s no guarantee that Microsoft is always going to be there, but I’d trust their MS money more than I would some national currencies”

    Jct: I urged Bill Gates to save the planet with Microsoft Money 10 years ago. See my Richest Pauper’s Prayer To The Richest Man at
    http://turmelpress.com/praybill.htm

  12. KingofthePaupers says:

    “But since the value of the money would still be linked to socially agreed upon value, the usefulness of an alternative money seems low… why not just use dollars?”

    Jct: Because they are not lending out any money at interest so why not borrow some community currency interest-free? You can stop using your own interest-free community currency as soon as the FED offers you interest-bearing loans again. But until you can access interest-bearing loans from the FED-connected banking system, why not accept interest-free loans from your community-connected banking system? You always have the option of getting back into exponential debt as soon as the loansharks will let you but why not use an alternative while they will not let you have any debt-enslavement money? It is a free choice whether to use the available community currency or wait for the not-available FED currency. No one is forcing you to join the community currency lifeboat if you want to stay with the sinking ship.

    • Antinous / Moderator says:

      KingofthePaupers,

      Is this an art project? At the very least, you’ve used up your allotment of links to your blog.

  13. SamSam says:

    So… I’m supposed to trust Craigslist with my money?

    Essentially, that’s what this would be. I could sell $1000 worth of used couches and car rides and whatever for real dollars, or I could sell them for “craigbucks.” These “craigbucks” would exist on the Craigslist servers, available to any hacker who can get around Craigslist’s protections, available to any Craigslist admin, and hostage to the server’s uptime.

    Obviously, some Libratarians are going to respond to this with “well, you can’t trust Benjamins either, because something something something gold standard blah blah blah.” That’s all well and good, but, sorry, I trust the Federal Reserve more than I trust Craigslist.

  14. bardfinn says:

    #10: Anonymous;

    Cryptography. Sufficiently strong cryptosystems would – if implemented correctly – allow for controls that would prevent counterfeiting, and allow for privacy and security as well as appropriate legal auditability and transparency.

    I have my doubts any such thing would be allowed by those currently in power – economic or political – to come about.

  15. DWittSF says:

    I prefer a more portable currency, such as whiskey.

  16. Inkstain says:

    ” I trust the Federal Reserve more than I trust Craigslist.”

    Oh dear sweet spaghetti monster, what have you done?

    *dives into a bunker for the incoming explosion of libertarians and anti-semites, united in their hatred of central banking*

  17. KingofthePaupers says:

    “Why has nobody mentioned the best thought out, and actually funcioning alternative currency: Timedollars? http://www.timebanks.org
    Videos available by searching “timedollars” on YouTube.”

    Jct: Timedollars is a beautiful system except that doctors get paid the same as floor-sweepers so there are few doctors who participate. Ithaca Hours allows doctors to charge more Hours per hour so they have a free market. Unfortunately, the Timedollars controllers have ordained that all labor will be credited equally in their controlled market. A fatal flaw that will be easily corrected when they adopt paper tokens and and can no longer control the market.
    http://tech.groups.yahoo.com/group/turmel/message/2415 is my report on the 2004 Timedollar Conference in Canada where they were testing out paper timetokens I demonstrated how they could not control my worth by playing my accordion in the hall for an hour and earning 4 Hours worth of credits in contributions.
    Of course, when the Timedollar controllers saw they could not longer keep their system ineffective if they lost control by permitting a free market with physical tokens, the killed the idea.
    Remember, the banksters have moles sabotaging community currencies all around the planet. If they are running this poker chips wrong, the person who suggested including the flaw is the bad guy.

  18. SamSam says:

    …but on the theme of printing your own currency, the town of Northampton, MA, recently had a coupon system, whereby, for every $50 you spent at a local store, you get a $5 coupon to use at another local store.

    The more I thought about it, the more I realized that what they were actually doing was pumping more money into the local economy, using a currency that was only accepted locally. The amount of currency printed was directly proportional the amount of currency spent.

    Pretty neat, except at the end of the day you could only spend this currency on clothes and tchotchkes, and the store owners that accepted them could actually use them to feed and clothe their families. (They did get the benefit of increased spending of real Benjamins, though, which was the main point of the program, I assume).

    Until you can pay the farmers who grow our food in craigbucks, or the Chinese workers who spin our clothes in craigbucks, then, such systems can only be used in fairly minor P2P goods and services transactions.

  19. KingofthePaupers says:

    “So you could, in theory, have MS pay their people, and others in MS money, and it would probably be perfectly acceptable in the NW and many other places.”

    Jct: Bill has not shown any particular wit when it comes to understanding money. I could not explain this to him, maybe you should try.

  20. KingofthePaupers says:

    “while no system of exchange is perfect, or completely immune to getting gamed,

    Jct: You presume. A transparent interest-free time-based system of exchange is ideal says the only Professor of Banking Systems Engineering in the world. Anyone wanna bet

  21. Ivan says:

    I make http://tipjoy.com – a social payments tool.

    I’ve thought a lot about DIY currencies that exist outside of government fiat. What’s needed is an open standard and protocol for exchanging between these currencies. Then the market could handle value based upon trust. Local currencies would have the benefit of a local basis of trust.

    Larger currencies would have trust based upon scale and momentum – basically the same reasons people trust the dollar, despite is being a fiat currency without real backing.

    As I’ve found with developing a payments startup, the regulation in dealing with this space is huge. That would be a barrier for any real adoption, as cash from the establishment would only flow if there is a legit interface to the rest of the foreign exchange world, or if there were enough anonymity to protect the users of electronic cash from the IRS, SEC, et al.

  22. Ernunnos says:

    The problem with these schemes is the same as the problem with every fiat currency. At some point, the temptation to print yourself rich becomes too much for the owners of the printing presses to resist. Digital cash just makes it easier.

    That’s exactly what my government is doing right now. Printing up enough money to make the profits from bad mortgages match the irrational expectations of the bankers who issued them. To the detriment of anyone else who holds dollars.

    The classic method of preventing this is to tie money to labor by way of metals dug out of the earth. The only way to “print” such money is to spend some time digging it up. It’s an idea we might be going back to.

  23. KingofthePaupers says:

    “LETS has been around in the UK for a while – only used on a small scale though.
    http://www.letslinkuk.net/home/theory.htm

    Jct: And I financed the development of the first LETS software as my gift to the planet to demonstrate locally how a time-based currency system could work globally.

  24. Takuan says:

    I could sign on with an all-liquor economy.

  25. SamSam says:

    A small correction to a typo in my comment above: “Pretty neat, except at the end of the day you could only spend this currency on clothes and tchotchkes, and the store owners that accepted them couldn’t actually use them to feed and clothe their families.

  26. fltndboat says:

    The post that I just lost would have changed the earth. Good that it was lost. Money is important sort of. Reciprocal maintenance with family and friends does not need money as the core. People are just conditioned to think that way.

  27. KingofthePaupers says:

    “What was your software called?”

    Jct: It was the original Dbase II LETS software developed by Michael Linton. Betting on Michael Linton’s LETS was the best investment I ever made.

  28. dragonfrog says:

    I’m not a big fan of solving a problem by going back to a paradigm that had many, many other problems but solves the current one.

    Most of those “other problems” amount to “Waaah, I can’t get rich as fast as I like!” But such wealth is illusory, anyway, so it’s not very convincing.

    Yeah, those other things like massive brutal slavery, the near extinction of all native societies in the Caribbean, the continuing poisoning of the Amazon basin with cyanide, that’s pretty minor compared to banker angst, huh?

  29. Inkstain says:

    “The classic method of preventing this is to tie money to labor by way of metals dug out of the earth. The only way to “print” such money is to spend some time digging it up. It’s an idea we might be going back to.”

    I’m not a big fan of solving a problem by going back to a paradigm that had many, many other problems but solves the current one.

  30. SamSam says:

    @ DWittSF

    I prefer a more portable currency, such as whiskey.

    That’s potable currency.

  31. milovoo says:

    I can’t locate any information on the “Elder Care Units” mentioned in the article. Does anyone have another source for info?

  32. fltndboat says:

    # 38 . Nope . The simple question is who is controlling the presidential nuclear football? Clearly not any president. Bush was dumb enough to pop another Neuc. Someone said no. They settled for a Predator drone station that Bush could interact with and kill people at a distance. Sorta like masturbating. That is what war is all about to the male ego. When you are in charge. Our economy is based on the idea that we can blow stuff up forever. To bad we sold the farm.

  33. thebishopofturkey says:

    “Those currencies could be almost anything: Cash we can use only at one local restaurant, cash cards for Wal-Mart or other chain stores, babysitting dollars we can trade in our neighborhoods”

    Don’t we already have this in the form of gift cards?

  34. Anonymous says:

    Paul Di Filippo has a great book about DIY currency, called Spondulix — one of my favorite of his books.

    -Tim Pratt

  35. SamSam says:

    @Ernunnos:

    The classic method of preventing this is to tie money to labor by way of metals dug out of the earth. The only way to “print” such money is to spend some time digging it up. It’s an idea we might be going back to.

    Is the point of tying money to digging metals out of the ground that it’s value is based on the “stuff” or the “time spent digging it up?”

    If it’s the physical copper, then what happens when we no longer have any need for copper? When it becomes purely symbolic, like gold? If it’s symbolic, why tie it to “stuff” in the first place?

    But if it’s based on the labor, then would you also get the same benefit if you had a perfect way to get a non-counterfeitable currency out of jumping jacks? Calories burned? Is it just labor for the sake of labor? requiring an expenditure of time for the sake of making it harder to print money? Are there not better ways humans could use their time and energy (from oil, presumably) than digging up metals?

    If it’s for the fact of spending time digging things, then essentially the creation of currency is tied directly to the investment in time in an otherwise-useless act, instead of an investment of time in an actually useful act, like invention or creation of goods or services.

  36. Takuan says:

    a diet of gold usually convinces.

  37. Anonymous says:

    @Peter X:

    There’s probably a very wide range of stable currencies the Somali pirates wouldn’t accept. Doesn’t mean they don’t work in the environments they’re meant for, and that they can’t be changed to something more acceptable to Somalis through institutions which offer such services.

    Currencies don’t need universal acceptance in order to be useful.

    As the resident of a small nation with its own currency, I can however tell you that currencies tied into small markets (whether it be a nation’s economic capacity, a rare metal, or babysitting services) are inherently unstable.

    So in essence… diversify thy portfolio.

  38. Anonymous says:

    Why has nobody mentioned the best thought out, and actually funcioning alternative currency: Timedollars? http://www.timebanks.org

    Videos available by searching “timedollars” on YouTube.

  39. niftycorp says:

    KINGOFTHEPAUPERS are you a LETS veteran? How exciting!

    Sydney was using some sort of system before we moved to CES – http://community-exchange.org/, I wonder if it was yours? What was your software called?

    Anyway, great to see some traders in the mix.

  40. peter x says:

    How many Craigsbucks did those Somali pirates want for that cargo ship?

    Anyone fool can print money. The trick is in the conversion.

  41. SednaBoo says:

    So I take money I can use anywhere, and exchange it for something I can only use on craiglist?

  42. firstbakingbook says:

    #6:

    I, for one, live on a debit card (who carries cash? Royalty? My mom?), and there’s always an underlying paranoia that it will just …stop.

    In Santa Cruz and Santa Clara counties in California, it did just …. stop, a few days ago when someone cut some fiber in San Jose. We lost land lines, cell phones, and DSL. Stores stopped accepting anything but cash. ATMs were not functional, and the banks closed their doors. One had to get through the day with whatever cash one had on-hand.

    It was fairly shocking to learn that both the phone networks and the banks had a single point of failure, with not so much as a contingency plan.

  43. Anonymous says:

    It would be far more reasonable for large corporations to do this ~ the underlying issue, as so many have pointed out, is trust. There’s no guarantee that Microsoft is always going to be there, but I’d trust their MS money more than I would some national currencies (US currently creeping up this list. Sigh…).

    The value of money is generally a negotiated value based on labor, not digging up gold (or anything else). Hence I make X dollars teaching (I’m an adjunct at a comm. college) which is based on socially perceived value.

    So you could, in theory, have MS pay their people, and others in MS money, and it would probably be perfectly acceptable in the NW and many other places. But since the value of the money would still be linked to socially agreed upon value, the usefulness of an alternative money seems low… why not just use dollars? At least I can use dollars to buy any computer I want ~ bet those guys at Apple wouldn’t take MS Money…

  44. Simon Cameron says:

    Complimentary currencies are terrible for government policy – in terms of taxation and managing the money supply.

  45. Cicada says:

    “So you could, in theory, have MS pay their people, and others in MS money, and it would probably be perfectly acceptable in the NW and many other places.”

    In other words, company scrip which could be spent at the company store? What an idea…wonder if that’s been tried…hmm…

  46. presterjohn says:

    bet those guys at Apple wouldn’t take MS Money…

    no, they wouldn’t. The would make iMoney, and of course, it would be minted out of Gold.

    Unfortunately, it wouldn’t help the local economy because you can never make another jobs.

    M$ would say that iMoney cost more than their virtual currency units, and Apple would say that the real reason was that M$ was creating M$ Money out of thin air, where as iMoney had the inherent value in the material as a hedge / fallback, and that the supply of Gold presented a natural limit on the growth in supply of iMoney, thus preventing inflationary abuse inherent in the M$ Money system.

    People would ignore the arguments on both sides and chose based on their lifestyle identity instead.

  47. nutbastard says:

    @#2 Simon Cameron

    thus the Ron Paul Liberty Dollar raid and shutdown.

  48. Anonymous says:

    “Most of those “other problems” amount to “Waaah, I can’t get rich as fast as I like!” But such wealth is illusory, anyway, so it’s not very convincing. And while no system of exchange is perfect, or completely immune to getting gamed, I defy you to find problems with using a physical marker that requires a real investment in human effort that even come close to using a marker for exchange that isn’t tied to anything but trust in the issuer’s restraint.”

    Wrong.
    Wrong, Wrong, Wrong.

    A liquid money-market makes the economy MANY times more efficient. This translates into products that everyone uses.

  49. markfrei says:

    I worked on one of those zillions of dot com projects to create an alternative internet currency. This is one of those things easier said than done – and the legal issues around taxes, fraud, etc get really crazy.

  50. Halloween Jack says:

    Beenz!.

  51. Ernunnos says:

    Is the point of tying money to digging metals out of the ground that it’s value is based on the “stuff” or the “time spent digging it up?”

    All economics comes down to human effort. Even if your value grows on trees (ie. fruit) you still have to go out and pick it.

    If it’s the physical copper, then what happens when we no longer have any need for copper? When it becomes purely symbolic, like gold?

    Copper’s an atomic element. It’s unlikely to ever become obsolete. Gold certainly isn’t. If it does, we’ll have moved to another plane of existence, and money will be the least of our concerns.

    But if it’s based on the labor, then would you also get the same benefit if you had a perfect way to get a non-counterfeitable currency out of jumping jacks? Calories burned?

    Sure. But why would you bother when mining works so well as a benchmark? It doesn’t follow Moore’s law. No matter how good technology gets, you still have to expend energy to move and refine earth. It produces a physical marker, so there’s no need for accounting beyond assaying and weighing. Both ancient technologies.

    Plus, it automatically tends to track the rest of the economy. If metals are over-valued, more people go to dig it up and stop other productive pursuits. But that brings down the relative value of the metal, and it becomes easier to make money by spending time to make other things and sell them to the people who dig up the metal. The people who really got rich from the gold rush were the general store owners. The result is a natural equilibrium. For a whole century on the gold standard, a beer cost 5 cents, and it didn’t really matter which year’s Sears & Roebuck you ordered from. The COD charge would be the same.

    You can use just about anything as money, and just about everything has been tried. But we always seem to come back to elements due to those factors.

  52. KingofthePaupers says:

    “Reminds me of Argentina and their recent economic collapse. There was a period of everyone printing their own shit. Surprise! It made things worse. Who’d a-thunk?”

    Jct: They went from banking system broken down in 2001 to all their IMF-World Bank Debt paid off in 2006. It didn’t make things worse, it made things work. I have 24 videos tracking use of community currencies and provincial bond currencies to effect recovery. If the US doesn’t follow their example, there won’t be such a recovery.
    Do your homework to appreciate that running your own money system liberates you from the debt slavery of their usury-based money system.

  53. usonia says:

    When Rushkoff says “…the developed world gets over its bias for ‘printing press–era cash technology’”, he means add didgital, all the time, eh? A debit card with your social security, controlled form the central database? Wasn’t this just on BoingBoing, but in the form of a Kindle getting bricked when the owners Amazon account went down? In “The Handmaid’s Tale” (I know, I know, it’s fiction. Marginally anyway), cash is long gone, and the government freezes the money cards. I, for one, live on a debit card (who carries cash? Royalty? My mom?), and there’s always an underlying paranoia that it will just …stop. Meanwhile, I have a PayPal debit card too, so I can spend the imaginary money I make on Ebay on real objects. But somewhere in there, I can get NOTES in exchange for my effort. Eventually, craiglist cash will have to translate to real cash.
    Why we gotta beat up on printing presses anyway?

  54. KingofthePaupers says:

    “Money is an insanely complex interdependent shared system.”

    Jct: Poker chips are too insanely a complex interdependent shared system to run right? Not.

  55. rushkoff says:

    So, should we do it? Who is in?

    The Australian Lets people say they’ll set up the software for it. And someone on the comments on my site suggested calling them NewMarks instead of Craigbucks. I kind of like that.

  56. Anonymous says:

    What’s the exchange rate in Schrute bucks?

  57. KingofthePaupers says:

    “These “craigbucks” would exist on the Craigslist servers, available to any hacker who can get around Craigslist’s protections, available to any Craigslist admin, and hostage to the server’s uptime.”

    Jct: Since everybody can see everyone else’s balance in a time-based LETS, where to you propose to hide the proceeds of your crime?
    The robber says “Stick’em up, credit my account.”
    Har har har har.

  58. KingofthePaupers says:

    “I trust the Federal Reserve more than I trust Craigslist.”

    Jct: I trust a stable transparent Craigslist timedollar before I trust the unstable FED bankdollar. I never thought I’d ever get to read:
    “I trust the Federal Reserve

  59. Ernunnos says:

    I’m not a big fan of solving a problem by going back to a paradigm that had many, many other problems but solves the current one.

    Most of those “other problems” amount to “Waaah, I can’t get rich as fast as I like!” But such wealth is illusory, anyway, so it’s not very convincing. And while no system of exchange is perfect, or completely immune to getting gamed, I defy you to find problems with using a physical marker that requires a real investment in human effort that even come close to using a marker for exchange that isn’t tied to anything but trust in the issuer’s restraint.

    It doesn’t matter what either of us think anyway. The Chinese are making the decision for us. They’re buying up the essential elements needed to make stuff. If you want stuff, you’ll give them as many paper dollars as they demand. If you don’t have stuff of your own, you’re only as rich as they’ll let you be.

  60. KingofthePaupers says:

    Cryptography. Sufficiently strong cryptosystems would – if implemented correctly – allow for controls that would prevent counterfeiting

    Jct: Security is unnecessary in a transparent interest-free credit-trading system. Where are you going to hide the loot

Leave a Reply