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Open Money? (was: RE: [ox-en] Threads "The Fading Altruism of Open Source" on <nettime>)



Hi Keith, other open-money fans, all!

[I removed the `cc' list. If others are interested in our discussion
they can subscribe or scan through the archive
[http://www.oekonux.org/list-en/].]

It's funny because some weeks ago after months I finally removed a
mail from Ernie Yacub from my `+inbox' where he commented on my
interview with Geert Lovink. I just did not have the energy to answer
and now some of you are here :-) . That's good because I'm - surprise
- *very* sceptical about the idea of open money as about LETS in
general.

Actually I'm not interested very much in the details like credit cards
and the like because I have big problems with the fundaments. And I'd
really like to sort this out here.

I think LETS have something - if it would not be the case they would
not be as successful as they are. I'd like to know what this something
is to have it available to be used in other concepts.

As you may expect for me the principles of Free Software are guiding
principles. So I'm looking to that phenomenon often and try to find
out how things work there. Indeed I think many things in Free Software
can't be understood with too much of the principles of exchange in
mind.

Ok, so I'll link into what Keith said.

2 days ago Keith Hart wrote:
But -- there has to be a but -- effective answers to these questions
require some understanding of how community currencies have evolved in the
last two decades.

Here comes my first question: Is this all limited to a community? How
big (i.e. number of people) may a community be?

Actually I guess you need a relative limited community to make your
social glue work. I guess this is one of the things interesting in
LETS: the social glue they provide to otherwise atomized indiiduals.

One big problem lies in our general inability to think
outside the box of national currency systems.

I'd add that our biggest problem lies in our general inability to
think outside the box of exchange systems at all. Can you do that? If
not, why? Actually I think this is the most interesting question at
all.

At least Free Software is not based on exchange. That means a lot to
me.

These are, as you point out,
central bank monopolies encouraging citizens to perceive of 'the economy'
as singular and in important respects self-sufficient.

There is a natural link between states and currencies: The states by
having the monopoly of power ("Gewaltmonopol" - can't find correct
translation :-( ) have the possibility to enforce the validity of a
currency. By having repressive forces like police, courts and jails,
or sometime armies they have the possibility to keep people from say
copying banknotes. One major aspect of this is that they are able to
keep money a scarce resource.

This reflects the coercion potential inherent in any sort of money.
Money is nothing but a structural mean to coerce someone to do
something which s/he would rather not to without being paid for it.

In a sharp contrast Free Software shows us a way to produce goods
which are useful on a worldwide basis and there is no coercion
involved. Because everybody is free to join or leave a Free Software
project whenever s/he likes and has no more "cost" for either of it
than there is inevitable on a factual basis, there is a structural
absence of coercion.

When people try to
set up some alternative, they often unconsciously mimic the dominant model,
setting up a single, self-sufficient closed circuit, with a central
register, its own currency and usually a committee of leaders to run it.
Members are individuals trading goods and services in parallel with the
national economy of which they are of course also members. Soon enough such
organizations run up against problems of size, quality of service, high
transaction costs, inadequate division of labour and so on. Some LETS
systems have persisted for a considerable length of time, but many also
fail in the short run, as often as not because of a weak conceptualisation
of the mechanics of community currencies.

There is one thing I simply don't understand in this whole concept.
You're proposing an exchange based system. But at the same time we
already have an exchanged based system with a history of several
thousand years but the last two- or three-hundred years being the
important ones because during this time money / exchange became the
dominant form in Western societies and in other parts of the world.

The things you're suggesting at least remember of older forms of money
which vanished during the history of implementation of exchange based
societies. I tend to say that it is not by chance that these older
forms vanished. I mean, there is a reason, that for instance limited
markets like the ones you have, when the validity of your money is
limited to your community, vanished. In the EU for instance they gave
up national currencies some years ago - and they say that it is useful
to have lower transactions costs and basically to have bigger markets.

I think these things don't appear from nowhere but are results of the
cybernetic machine called capitalism which runs without human
intervention the same as without human measure. So - as I stated in
another post yesterday - I think capitalism is the most unfolded
system based on exchange.

And now for the question: How do you think your system can stop these
mechanisms, this invisible hand?

The key intellectual and practical breakthrough consists in thinking of
community currencies as plural rather than singular. Individuals may belong
routinely to as many circuits as they already have credit cards and other
plastic instruments at their disposal.

As I understood this is the key difference between ordinary LETS and
open money. Well I'd say this limits the validity of your money even
further - even to a point where you virtually can't buy anything for
your money because you have always to little from something at least
when your available currency is of this sort:

Some communities may insist on positive
balances only (no overdrafts) or limit negative balances to a certain
amount.

Which is BTW basically the same I guess. A limited negative balance
can be seen as the same amount of advance money for everybody.

Clearly, the vision I am presenting here is not anti-capitalist in the
usual way.

BTW: I'm not very much in favor for all the antis. So my main concern
is not to fight capitalism but to overcome it. In this we may have
different directions anyway. I think LETS / open money may be useful
to some people in capitalism - as I said: They have something. But as
I am sceptical about any system based on exchange IMHO this could only
be temporary solutions. Actually I don't know what you are proposing:
Open money as a aid for people in (a declining) capitalism (unable to
provide things on a regular basis) or whether you're proposing a
society based on open money.

Open money is not a scarce commodity,

Ahm, what? A money which is not scarce is anything but money. If I can
create money by free will out of nothing than what would it be good
for at all?

it has no price (interest)

Uuh the old Gesellian thesis. Again I'd say that in a society based on
exchange at some point interest is something which can't be prevented
as such a society unfolds.

and cannot be hoarded or used as capital.

Capital is money which is used to create more money. For that aim
hoarding is counterproductive anyway. I can't see why this is not
possible with open money. Why for instance is wage labor impossible
with LETS / open money?

My colleagues and I believe that
markets and money can be developed on non-capitalist principles, initially
as part of capitalist commerce, not independently of it.

This pops up the question what capitalist means to you. I understand
any society based on exchange as capitalist - even the former Soviet
Union.


						Mit Freien Grüßen

						Stefan

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http://www.oekonux.org/


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