Unlike, government and central bank fiat currencies which promise nothing but their acceptance as tax payments, private currency vouchers promise to be redeemed for real valuable goods and services. If the issuer is trustworthy and can be counted on to honor their pledge of redemption, their currency vouchers can provide traders with an exchange and payment medium that is superior to government and central bank fiat monies. Such honest currencies are neither novel nor odd, but have a long history and are an absolute necessity for the decentralization of economic and political power and the emergence of a peaceful and equitable social order.
A few years ago I wrote up a proposal for a private currency voucher that I call the Solar Dollar which attracted some significant interest. My intention was twofold, one, to provide an independent payment medium for a local community, i.e., a currency that can be created outside of the banking system and thus empower participants in a local economy by compensating for shortages and mal-distribution of government fiat money, and two, to incentivize the shift of energy production, sales and usage toward solar and other renewable sources of electric power. My hope was that some electric utility company somewhere would implement the plan and become a model for others utilities to follow. That, unfortunately, has not yet happened but I am confident that it, or something like it, eventually will. In the meantime, I’ve continued to publicize it, and in 2021 I was invited to give a presentation titled, Solar Dollars–Empowering Communities While Powering Communities With Renewable Energy, for a virtual conference that was sponsored by the Zero Carbon Lab at the University of Hertfordshire (UK). Later that year, under the good auspices of Professor Ljubomir Jankovic, my original white paper was revised and published with the title, Solar Dollars: A Complementary Currency that Incentivizes Renewable Energy, in the academic journal, Frontiers in Built Environment.
Overall, the primary objective of my work has been, and remains, the decentralization of financial, economic, and political power. The most promising strategy for achieving that is the design and deployment of private credit currencies that are spent into circulation by trusted issuers that are ready, willing, and able to redeem their currencies promptly for the real goods and services that are their normal stock in trade. By breaking the credit monopoly that the banking cartel presently holds, and empowering producers and sellers of real value, it then becomes possible to reverse the longstanding trend toward ever greater power and wealth in the hands of the global elite who have captured the machinery of finance, economics, and government.
The Solar Dollar is a special case and example of a private credit currency issued by a trusted producer and provider of real value, but similar objectives could be achieved by companies in other lines of business, for example, by:
The issuance of local Farm Produce Dollars that would be spent into circulation by a single local farmer or jointly by a cooperating group of local farmers and ranchers, or by
The issuance of local Shelter Certificates that are spent into circulation by a single local owner of rental property or jointly by a cooperating group of local owners of rental property, or by
The issuance of Service Certificates by a local provider of some sort of professional or household services, or jointly by a cooperating group of such service providers, or by
The issuance of currency vouchers by all of the above producers/providers and others who band together to cooperatively issue a sound complementary currency under a common “brand.” Such a currency would provide a means of payment that is not only independent of the banking system but solidly backed by the combined production and distribution capacity of all participating businesses. (Many “community currencies” have been created over the years in many places around the world but virtually all of them are “sold” for government fiat currencies which defeats the main objective of creating a currency that is independent of government and the banking system).
All of these currency vouchers or credits are able to circulate as payment media throughout their local communities to enable trading despite any scarcity or unavailability of official money. There are many historical and contemporary examples of such private credit instruments, so most of what I’m suggesting has already been shown to be workable. The main problem I have observed is getting producers of real value to recognize the power they already have and to exercise it on their own behalf and that of their communities.
“The stream of political monies from the beginning to the present day runs deep and dirty, yet to suggest that money can spring from any other source is to surprise if not even to dismay. So has tradition dulled men’s senses. No matter how often the state fails to supply a virtuous money system, men rush back to it in desperation and beg it to try again. Indeed, until we learn that the money power resides in us, we must abjectly beg the state to give us an exploitative system because we cannot return to a moneyless civilization. Yet, no matter how often and earnestly the state tries to provide a true money system, it must fail because of an inherent antipathy between the money issuing power and the taxing power. A money issuer must be a seller who bids for money, not a taxer who requisitions it in whole or in part, as politically expedient and without a quid pro quid.” — pp. 25-26.
Political democracy cannot work without economic democracy; and the money power is the franchise of the latter. — p. 35
It is the false concept of political money power that converts citizens into petitioners, and makes government a dispenser of patronage instead of a public servant. This power of patronage utterly destroys the democratic system of government – since the people cannot be both petitioners and rulers.” — pp. 78-79
Throughout my career as a monetary theorist, educator, and advisor, taking up where Riegel and others have left off, I have tried to influence producers, entrepreneurs, and social organizers toward effective action based on sound principles of credit allocation and management. But superstitious myths die hard and old habits are difficult to break. The great majority of people remain in thrall to official currencies. That is what the oligarchs depend upon to keep us in debt and under their control. I have learned to be patient and await the changes in financial, economic, and political conditions that will open people’s minds to adopting self-help and cooperative approaches to getting our needs met, specifically, the need for free and fair exchange of value in the marketplace.
Surely, the day will come, and is rapidly approaching, when the failures and demands of the dominant global central banking, political, interest-based, debt-money regime will become so clearly evident and abysmal that the only peaceful option will be for we-the-people to implement our own systems of exchange and finance grounded in our own initiative and judgment in allocating credit based on productive capacity and trustworthiness.
On Monday July 12, 2021, I will be presenting my proposal for a currency based on, and redeemable for renewable energy. My presentation titled, Solar Dollars: Unblocking Multi-dimensional Mega-crisis with Complementary Currency Obtained from the Sun, will be part of a two day virtual conference titled Pathways to Resilient Zero Carbon Cities organized by Zero Carbon Lab, School of Creative Arts, University of Hertfordshire (UK). My presentation is scheduled for 16:15 – 16:45 GMT (11:15-11:45 EDT; 08:15-08:45 PDT and Arizona time), You can register for the conference via this link – please book early as the number of registrations is limited.
This appeal by Congressman Ron Paul is perhaps the most important proposal by an American politician in the last 100 years. I’m glad to know that Congressman Paul is not limiting his proposal to gold and silver currencies.
The most liberating means of payment is “mutual credit clearing” through independent non-bank associations of businesses and individuals.
Of course, the credit in such accounts needs to be denominated in some objective units, which could be specified weights of gold or silver, but better still, would be an “index unit” based on a “market basket” of basic commodities that are widely and freely traded.
My four books on the subject, and my websites, provide coverage of pertinent concepts and history, and full details on my prescriptions for businesses, communities, and governments.–t.h.g.
I recently held a hearing in my congressional subcommittee on the subject of competing currencies. This is an issue of enormous importance, but unfortunately few Americans understand how the Federal Reserve and Treasury Department impose a strict monopoly on money in America.
This monopoly is maintained using federal counterfeiting laws, which is a bit rich. If any organization is guilty of counterfeiting dollars, it is our own Treasury. But those who dare to challenge federal legal tender laws by circulating competing currencies– at least physical currencies– risk going to prison.
Like all government created monopolies, the federal monopoly on money results in substandard product in the form of our ever-depreciating dollars.
Yet governments have always sought to monopolize the issuance of money, either directly or through the creation of central banks. The expanding role of the Federal Reserve in the 20th century enabled our federal government to grow wildly larger than would have been possible otherwise. Our Fed, like all central banks, encourages deficits by effectively monetizing Treasury debt. But the price we pay is the terrible and ongoing debasement of our money.
Allowing individuals and business to use alternate currencies, especially currencies backed by gold and silver, would expose the whole rotten system because the marketplace would prefer such alternate currencies unless and until the Fed suddenly imposed radical discipline on its dollar inflation.
Sadly, Americans are far less free than many others around the world when it comes to protecting themselves against the rapidly depreciating US dollar. Mexican workers can set up accounts denominated in ounces of silver and take tax-free delivery of that silver whenever they want. In Singapore and other Asian countries, individuals can set up bank accounts denominated in gold and silver. Debit cards can be linked to gold and silver accounts so that customers can use gold and silver to make point of sale transactions, a service which is only available to non-Americans.
The obvious solution is to legalize monetary freedom and allow the circulation of parallel and competing currencies. There is no reason why Americans should not be able to transact, save, and invest using the currency of their choosing. They should be free to use gold, silver, or other currencies with no legal restrictions or punitive taxation standing in the way. Restoring the monetary system envisioned by the Constitution is the only way to ensure the economic security of the American people.
After all, if our monetary system is fundamentally sound– and the Federal Reserve indeed stabilizes the dollar as its apologists claim–then why fear competition? Why do we accept that centralized, monopoly control over our money is compatible with a supposedly free-market economy? In a free market, the government’s fiat dollar should compete with alternate currencies for the benefit of American consumers, savers, and investors.
As Austrian economist Ludwig von Mises explained, sound money is an instrument that protects our civil liberties against despotic government. Our current monetary system is indeed despotic, and the surest way to correct things simply is to legalize competing currencies.
For anyone who is confused about foreign exchange rates and speculation (which I think includes almost everyone), here is a clear explanation provided by Prof. Dr. Ahamed Kameel Mydin Meera of the International Islamic University of Malaysia. He explains it in relation to the 1997 East Asian Crisis that was brought on by speculative attacks (manipulation) on several Asian currencies.–t.h.g.