I keep trying, looking back at 2011 from 2017…
“What the Occupy Wall Street Movement May be Missing”
from October, 2011, Washington, DC.
Recent demands to abolish the Federal Reserve may lack a solid grounding in the history of
monetary governance, but have roots in a crucial right, taken for granted in every democracy.
That is: the right of citizens to participate meaningfully in the key decision-making processes
associated with the communities in which they live. J. Huber and M. Kennedy agree that the
private ownership of the Fed, and its share in the seigniorage revenues associated with the
Fractional Reserve Banking System and the debt-based creation of the US money supply,
present problems for both social justice and long-term financial stability. Nevertheless, K.
Polanyi´s works showed that the gold standard, which would perforce be necessary without
The Fed, upheld a system of currency monopoly which was just as prohibitive of full
economic participation in egalitarian democracies. One potential set of solutions involves a
multi-layered approach which can allow greater flexibility for both local communities and multinational or large-scale investors.
Given our globalized economy, Sir J. M. Keynes showed that governments must force
circulation of the medium of exchange (MOE) by spending into the public sector, through
borrowing if need be. This is the key benefit of fiat money, created from nothing. Yet, Keynes
agreed with S. Gesell that modern money´s MOE function of conflicts with the Storage of
Value (SOV) function, also filled by modern money, but previously filled by separate
currencies, before modern national monetary monopoly became standard. I. Fisher likewise
advocated different currencies for the MOE and SOV functions, allowing local communities to
be insulated from the financial instability of the global monetary supply while simultaneously
allowing access to both international and local economic participation. MOEs like Stamp
Scrip and Ithaca Hours have worked as “multipliers” in local economies, while SOV currencies
like Time Dollars, issued by E. Cahn´s Time Banks, allow local storage of work energy without
inflation concerns. Such local currencies also allow for greater access by local citizens to
monetary decision-making processes.
A. Fung suggests creating links between institutions at various levels. A similarly linked
three-tiered financial system arises as a logical policy recommendation that could potentially
allow all monetary stakeholders a significantly increased level of access to monetary decision-
making. First, each community having its own community-based MOE currency as well as
multiple community Time Banks would allow more direct input from currency users, and more
direct control over local economies. Those community currencies may need to be regionally
connected to the national currency or to the currencies of neighbouring communities, allowing
greater flexibility for local communities while coordinating financial concerns across several
regions. At a second level, national currencies can continue to allow independent but
connected financial structure across national and international boundaries. At a third level,
the creation of a truly international currency, separate from any domestically used national
currency, would provide international money users with a neutral and coordinated financial
system for travel and international business needs.
Participation in currency decision-making is important from several standpoints: economic,
social and ethical. From an economic perspective, the more participation in decision-making
and hence buy-in, a currency has, the more circulation, and the more support from users of
that currency. From a social point of view, recalling the “Constitutional Consensus” spoken of
by Huber, sharing the benefits of common resources, including money, increases the overall
social good by consistently adhering to that consensus. Readers familiar with V. Zelizer´s
“Pin Money” will recall her contention that money is a social construction. As such, money
belongs within the social sphere, and clearly the political. In a democratic society, this
entertwining of the economic with the social and political implies an inherent right to
meaningful economic as well as social and political participation in decisions which affect
society. Since money so deeply affects both society as a whole, and individual members of
society, A. Sen´s assertion that communities have a right to control their own development
means that communities must participate in monetary decision-making. Shared Monetary
Governance, by devolving more economic decision-making to local levels, can increase that
buy-in and social good which is not only the consensus in democratic societies, but also a
basic human right.
