Director,
T.E.(Terry)
Manning,
Schoener 50,
1771 ED
Wieringerwerf,
The
Tel:
0031-227-604128
Homepage:
http://www.flowman.nl
E-mail: (nameatendofline)@xs4all.nl :
bakensverzet
Incorporating innovative
social, financial, economic, local administrative and productive structures,
numerous renewable energy applications, with an important role for women in
poverty alleviation in rural and poor urban environments.
"Money is not the key that
opens the gates of the market but the bolt that bars them"
Gesell, Silvio The Natural
Economic Order
Revised English edition, Peter
Owen, London 1958, page 228
Edition 12:
The
local exchange trading (LETS) system foreseen will be set up during Moraisian
organisational workshops.
The
following texts, drawings and graphs form an integral part of this project
proposal. They indicate the type of structure which can be expected to come out
of the workshops.
DRAWING OF
INSTITUTIONAL STRUCTURES.
DRAWING OF LETS
STRUCTURES.
HOW A LETS TRANSACTION
WORKS.
A
simple introduction to local money systems.
Information package
LETS LINK UK.
In
principle, (one, two, three or four ) local LETS currency systems will be set up
(according to clearly definable operating areas. )
All
adults within a system should be registered as members, but use of the system
with exceptions for goods and services necessary for the project itself, would
be voluntary. Any member may usually freely choose whether to conduct a given
transaction in the local currency system or within the formal currency system.
The
LETS group(s) will have (30.000) registered adult members. Bearing in mind the
recommendations of the international convention on the rights of children,
children under the age of (14) will not be registered. They will become
registered members of their local LETS systems upon reaching the age of (14).
The members of each group will be coded so that their and tank-commission and
well areas can be identified and the cost of more local, optional, initiatives
such as PV lighting for study purposes debited to the members directly involved
rather than to the whole project area.
A
"catalogue" of goods and services is prepared periodically in a form which can
be understood/read by the group members. Which goods and services are available in the project area and who
provides them is already widely known at local level.
The
reference value of the local money system will be decided with the local
population. It will probably be based on the perceived value of an hour’s work. (Since the local LETS currencies will
have the same reference value, they can be transferable from one to another.
However, not all goods and services will be transferable between the different
systems, as this could lead to a drain of resources from one system to another.)
LETS systems work best when the financial resources remain balanced within each
system. The LETS coordinators and the members will decide which goods and
services are "exportable". Gypsum composite products made in group A, for
instance, could be exportable to group "B". Cloth made in group "B" may be
exportable to group A. Crops and vegetables not grown in one group could be
importable from the others.
Assume
that a gypsum composite product is sold by a group A member to a group B member.
The transaction would be in local currency A. The gypsum composite product
manufacturer would be credited in local currency A. The coordinator of group A
would advise his counterpart in group B of the debit for the group B member and
separately credit group A with the same amount in group B currency. The group B
coordinator would debit the group B buyer in local currency B, and, separately,
debit group B with the same amount in group A currency. Goods and services
supplied by group B to group A would be registered the other way round. The
group A and B coordinators then simply eliminate the respective debits and
credits by pairing value units one for one.
The
following fully automated registrations take place:
1.
The
group A producer would be credited in local currency A.
2.
The
coordinator of group A would advise his counterpart in group B of the debit for
the group B member.
3.
The
coordinator of group A would credit his group A with the same amount in group B
currency.
4.
The
group B coordinator would debit the group B buyer in local currency
B.
5. The group B
coordinator would debit his group B with the same amount in group A
currency.
6.
Goods
and services supplied by group B to group A would be registered the other way
round, following the procedures described in steps 1) to 5).
7.
The
group A and B coordinators then simply eliminate the respective debits and
credits by pairing value units one for one.
8.
In
case of a (large) remaining credit balance of one of the two groups at the cost
of the other, the coordinators will take whatever steps necessary to bring the
balance of the accounts as close as possible back to zero as quickly as
possible. There are many ways of doing this. Allowing extra goods and services
to be exported from the debtor system to the creditor system is one way.
Organising markets or fairs with debtor area products in the credit area is
another. Organising tourist outings of creditor area residents in the debtor
area is another.
The
processes broadly follow traditional balance of payments transactions but the
objective is to maintain a balance in imports and exports. A large debit balance
between one LETS group and another would show resources are being transferred
from one group to another. The coordinators would then have to take steps to
correct the imbalance. They could, for example, temporarily extend the range of
goods and services the debtor group can export to the creditor group, such as by
arranging a special market.
It
is a key to the success of the system that the imports and exports of each group
remain balanced, their sum tending to zero.
There
will be an elected local LETS coordinator in each tank commission area. The LETS
coordinator will need to be literate and will be responsible to the general LETS
systems coordinator. The local coordinators will help those members unable to
write/sign their cheques (or deal with other methods of payment), arrange
distribution of chequebooks (or other payment forms)to the LETS users, collect
the used cheques (or equivalent) deposited in the LETS POST box near the local
water tank and take them to the LETS systems coordinator at well-commission
level for registration. The local coordinators will also display the monthly or
weekly reports on the LETS NOTICE BOARD near or above the LETS POST box, advise
illiterate members of their LETS balances, call a fortnightly or monthly meeting
where the users can discuss the operation of their LETS system, make special
requests (such as, for example, increasing the debt limit for sick members or
for those making special purchases), and discuss ways to use the goods and
services of those with high debts so as to help balance their trading accounts.
The local coordinators will also discuss with the members selected proposals for
allowing export and import of goods and services into the local LETS system and
report back to the general LETS coordinator.
(The
first general LETS systems coordinator will be chosen by the Project
Administrator.) The LETS system coordinator and the locally elected LETS
coordinators at well-commission level will make up the LETS MANAGEMENT
COMMISSION. The commission will meet at least once a month to discuss particular
problems and to decide on actions needed to balance the export/import accounts
amongst the various local LETS currencies.
The
fortnightly/monthly reports for members in each tank commission area are in the
public domain. They will be published on the local LETS NOTICE board and
discussed at a general meeting of the local members. The report will show, for
each member, the previous balance, the current balance, the total number of plus
transactions and minus transactions conducted. Lists of plus and minus
transaction since the previous report can be supplied on request..
The
cheque (or other transaction form used)will have three parts. Each part will
have the member's name and LETS number pre-printed on it. The SELLER'S cheque is
used in each transaction. The BUYER’S name and system code are filled in on the
cheque, with the assistance of the local coordinator where necessary, as well as
a description (with LETS code) of the goods or services sold. Finally the cheque
is signed by the buyer and deposited by the seller in the LETS
post box. The amount credited to the seller must always be exactly the same as
that debited to the buyer(s). The
second “slip” is a memo for the buyer. The first “slip” is a memo for the
seller.
Payments
for LETS services provided by members to their communities or to specific groups
such as clubs will be debited to a special LETS code for the community or club.
When the community or club debt reaches one LETS currency unit (or other agreed
amount) for each member, each member will be debited with that amount. The
community or club LETS code will then be credited by the same total amount. This
system allows collective communal property to be involved in the LETS
transactions. For example, the sale of wood from communal land can be registered
as a credit to the LETS group involved, and then transferred from there to
individual group members.
Forward: effects of
inflation.
Back: taxation and the
local money systems.
List of drawings and
graphs.
Typical list of maps.
List of key
words.
List of
abbreviations used.
Documents for
funding applications.
