18 Nov 2012

The Civic : a proposition for an alternative currency

In my last post, I mentioned that the book "Money and Sustainability :  The missing link" contains a whole pile of very intersting propositions. One of my favourites is the idea of the Civic, a sort of local tax that can be used to encourage socially useful actions within the community.

Here's how the authors describe the idea.
"The city starts by requiring its residents to make an annual 'Civics' contribution. A Civic is an electronic unit issued by the city that is earned by residents through activities that contribute to the city's publicly agree upon aim. The unit of account could be one hour of time, valued at the same rate for everyone".

"Every household would have this obligation, with appropriate exemptions for people with handicaps, people caring for young children or elderly parents or other reasons".

"The governmental entity would accept only Civics as a form of payment for this obligation and would not set a fixed exchange rate between the Civic and the national currency. Residents could exchange Civics for national currency on free-market principles. A local online market (like eBay) could be set up to facilitate such exchances and assure transparency and trust". 
I can see a number of serious advantages to such a system.

First, it is a way of getting things done in the the community without the need to borrow money and pay interest. The city would simply be taking advantage of its right to raise taxes to encourage particular types of action. But unlike normal taxes, even people with no financial resources would be able to contribute.

Second, the activities covered by the scheme would be entirely voluntary. People who did not want to be involved could stay clear. But when then time came to pay the Civic tax, they would be obliged to  buy excess Civics from people who had more than they need.

Third, this means that those who could not find normal jobs could earn extra Civics and then trade them in for "real" money. Interestingly, depending on how civic-minded the population is, the value of those Civics would vary. If not enough people were contributing, the cost of buying the civics could get quite high. In contrast, when the overwhelming majority were participating, the free-market value of excess Civics would drop. And indeed, if the system ended up working very well, all the necessary work would be done, everyone would be involved, and it would cost no money at all.  Wonderful! No money. No debt.

Of course, I suppose that there may be some who would object to being "forced" to do work for the community. Well, I would say to those people that they should not expect to be able to use the municipal facilities such as libraries, parks, theatres, public transport and so forth. But hopefully, such antisocial attitudes would be rare. 

So, I really do think that the Civics idea is neat. And it can easily be combined with any of the other approaches that I have been endorsing - such as the N-Euro or the creation of conventional money by central banks for projects that are in the public interest.


  1. dear Simon. the thing about civics is that that don't have to be implemented only by the state or the city. any community i.e any group of people with the ability to make union decisions can decide to put such a tax on itself. the tenants in a building for example can decide that instead of paying the regular building committee fee they decide to pay part regular money and part civics which they invent and manage. they also decide about tasks for which such civics can be earned. like cleaning the building, organize thing for kids, organize building parties, take care of the garden' put plants/ what ever/ and thus the building can achive much more while paying much less regular money/ if one of the neighbors don't want to pay the civics he can by them from a neighbor who earned more the he need and so actually working in your community can earn some people a living.the activity of such a building than can spread to the neighborhood where again people put the tax on them selves as a mutual decision in order to things together in their community.

  2. Thanks Yanai,

    Absolutely. There are really plenty of ways to introduce this sort of scheme at every level. We have been completely duped into believing that only "real" money (euros, dollars, pounds) are worth working for. One of the main themes of many of the people proposing these sorts of schemes is that they don't have to be exclusive. They can all run in parallel, allowing the system to build resiliance.