Tuesday, April 12, 2011

Tadit Anderson: The Community Reserve Exchange

"The CRX model is a Local Exchange Trading System and is an advancement over the common model applied as a LETS system. The most common LETS model is a debt based exchange system, and thereby reproduces the private and debt based monetary process at a community level. The CRX reflects the current best proposal for the reforms analyzed as necessary to reform the current default of a privatized monetary system. It thereby complies with the principles that are crucial to the American Monetary Institute proposal for national monetary reform. The details of the AMI proposal can be found at their website.

"The CRX also applies the principles of modern monetary theory, as detailed by post Keynesian economists such as L. Randal Wray and others. It also includes many of the principles of functional fiscal policies as advocated by Abba Lerner, Hyman Minsky, and others. It defines the value of basic labor upon the principle of a "living wage." It also applies limitations to prevent usury, organizes to share risk, and supports the development of community. The CRX is intended as a practical process to facilitate exchanges, retain community wealth, and serve as an educational tool to advance economic literacy and the advocacy of economic reform."

The rest of the post elaborates how the CRX works using both CRN (community reserve notes) and FRN (federal reserve notes) within the purview of US law and regulation. Nothing like setting up a community reserve exchange to learn firsthand how a monetary system operates.


Anonymous said...

Reminds me of the Brixton Pound - http://brixtonpound.org/ and http://en.wikipedia.org/wiki/Brixton

Larry Staton Jr. said...

I teach my kids about modern money by paying them in Daddy Dollars ($DD). I'm working on a write up at http://www.taxdrivenmoney.com

BTW, I also own modernmonetarytheory.com and I'm looking for ideas on how to use the domain name.

Anonymous said...

Where is the tax driven demand for this "currency"?

Tom Hickey said...

Good question, TC. In my reading about community currencies they often are creatures of perceived necessity. A communities needs are not being met with the state's money so people take matters in their own hands. I think that this probably works without taxes on a community level.

But community money can also be a creature of convenience. Take barter club money. Large barter clubs create their own scrip to facilitate barter trade. Some of the big clubs have been doing this successfully for many years. This is really community money rather than barter, strictly speaking, since it is not direct exchange of goods but uses a medium of exchange. They call it "barter" since the medium is not state money.

Anonymous said...

to "TC" the tax driven demand for the Community Reserve Notes with the CRX is that the CRNs are created by labor of CRX members contributed to local participating non-profit organization. This is directly borrowed from the UMKC Buckaroos currency system. There is also the capacity to tax members directly for service fees and membership. Excess reserves can be similarly absorbed into internal revolving loan funds as reserve equity, This a late response, and I was not aware of this posting by Tom H. until just recently, today. Tadit ideasinc@ee.net

Tom Hickey said...

Thanks for the clarification, Tadit.