Another Financial system & Money for Finland
Report of the third discussion : Currency as a commons.
The title of the event “Currency as a Commons” turned the focus of this evening to the different proposals taking back the (financial) economy. Parallel to banks and financial markets, these are collaborative credit systems, based on voluntary collaboration, which can be serving autonomous networks and solidarity economy building. Alternatives discussed in this meeting included collaborative credit systems, the promise of Blockchains, complementary currency philosophy, design, and local implementation.
This session was hosted by Ruby van der Wekken, Mikko Laamanen, Joonas Pekkanen from D-CENT and Kristian Wahlbeck from the Finnish Association for Mental Health. In his short welcome, Kristian discussed the history of the Lapinlahti hospital, which is now going through a transition from a mental institution to a place for collaborative work, social entrepreneurship, and mental wellbeing. This third discussion session included four presentations on blockchain technology and the Robin Hood co-operative, D-Cent project and experimentation in Finland (and at Lapinlahden Lähde), on solidarity economy building through timebanking, and the development of local / complementary currencies in Europe. A main question for all was how does the particular initiative/development contribute to other economy building.
Pekko Koskinen: Robin Hood co-op and beyond
The Robin Hood Cooperative (http://www.robinhoodcoop.org) started as a parasyte algorithm tracking all investments in the NY exchange, and copying good investment behaviour, opening as such investments to regular people who otherwise would be excluded. Robin Hood Coop has been using the profits created for commons related projects.
Pekko (Robinhood co-op, Reality Research Centre) described these workings as Robin Hood 1.0. Bitcoin has been a first generation blockchain experience creating a trust network of numbers, a functioning currency without any need to build trust by multiple layers of (international) governance. 2nd generation blockchain currencies do not only build trust levels, but are small programs,which allow for more building than just transfers. So for instance ownership of land can be tracked, and similar trust levels as currently offered by governments can be built. The blockchain 2.0 generation create as such new economic interactions. Today we are mostly limited to buying and selling, and are largely cut off of from the forming of other kinds of economic relations for example as in equity structures, shared ownership. The baby steps toward new economic structures are seen in crowdfunding, like kickstarter. Kickstarter is a company, and what kickstarter offers is rather simple. There is a buy and sell transaction and added are 2 conditions. But what’s currently been developed are programs with more building blocks. What if this development is made open source P2P? Then we come to a very different economy.
With this the whole idea of economy comes to change. And it is important to start taking a hold of this. For the main question then becomes, who will make the change, and how it will work. Will it be the banks which are already creating their own blockchains? or will it be smaller units which have other ideological background.
http://bambuser.com/v/6037608 (event and Pekko’s starts from 20:00 min)
Marco Sachy: D-Cent project process
Marco Sachy’s works in the D-CENT project, http://dcentproject.eu/, which includes designing local currencies. D-CENT then developed Freecoin, a set of tools to let people run reward schemes that are transparent and auditable to other organisations. The domains of innovation that Freecoin offers is that community members can decide on the systemic features of the currency system they use, with the social proof of work, which is the proof that members have abided to previously agreed- upon ‘rules of the game’ in order to be rewarded. Timebank is good example of social currency, with the members having abided to previously agreed upon rules of the game. And secondly, D-cent digital social currency pilots are experiences in reputation management, distributed trust management systems. D-CENT came to Helsinki in the spring of 2014 to map the alternative currencies situation.
For the Finnish context, D-CENT created Multapaakku, which incorporates the idea of social proof-of-work. The currency is a means for the monitoring of amounts of work, as in a cooperative where different quantities of work are performed. It includes giving power to the worker to remunerate himself after his work. The idea is currently to test the system, a peer-to-peer transaction management for the common good in which everybody is able to monitor. Being a blockchain-based complementary currency gives it an element of resilience: if the system is down it is still works.
See also dyndy.net for Marco’s hactivist writings.
Ruby van der Wekken: Timebanking and solidarity economy building, the case for a timetax.
Ruby told of Helsinki Timebanks development of which she has been an active member since its inception in 2009, and in these six years more than 24.000 tovi’s have been exchanged. Helsinki Timebank is part of/runs on the Community Exchange Systems (CES), which hosts today some 780 groups in 80 countries, and which all can intertrade.
Solidarity economy envisioning and methodology has been inspirational to the development of the timebank, putting upfront that economy is ‘nothing else’ but the way we organise daily life. If then putting on right lenses, we can see around us different economic actors which have other values than monetary profit upfront, and whose motive is the social reproduction of life. By increasingly using them and linking these economic activities (as through a complementary currency as aikapankki) we can be further growing another economy, and in this process further our commons and the commoning around them. The time currency itself then, is not a commodity, but a token in a ‘credit commons’ that allows people to exchange services, earning and spending credits. The process of defining the principles and the rules of the credit currency itself a process of commoning. This envisioning has been accompanying the timebank’s intensive development process determining its values and principles, and through which it came to define itself as “Helsinki Timebank’s objective is to support mutual assistance between people, and through this strengthen communal culture. Helsinki Timebank strengthens a social and ecological just local economy, in which everyone is of equal value and has equal participation possibilities.”
Current taxation guidelines according to which taxation is to be payed on professional services received in a timebank has been hindering the development and thus realisation of the potential of the timebank. There is a need to settle the role in society for a timebank, for any complementary currency for that matter. Helsinki timebank in response developed the idea of a timetax, which is already operating in the timebank. Building further on this, we could then imagine a public actor approved for membership joining a timebank, who would as such also become a recipient of timetax allocations. This is as such a process pointing to not a privatising but commonifying of the public. Ruby said to have come to understand that the idea of a timetax is besides an answer to the taxation issue, also in itself an interesting proposal. We all afterall work part of our time to pay taxation, why not (partly) do so directly in places and spaces we want to be present at. Can Helsinki city come to trust in this kind of peoples economy building, including its proposal for a timetax?
Leander Bindewald: Current debates on complementary currencies
Leander Bindewald, formerly with the New Economic Foundation, is now doing his Ph.D. at the University of Cumbria on complementary currencies and discourses around money. As Leander pointed to, money as we know it, is just one kind of currency, mostly issued by commercial banks. There can be different currencies, a unit system facilitating collaboration within a community. As with a timebank, the question when designing a currency is what kind of human system do we want to build. Different answers will be given by different groups with different priorities, which via the different currencies can give rise to a pluralistic economy where these voices are heard.
A blockchain then does not bind to any particular form of currency, but offers a range of opportunities. One still then needs to decide what want/need to do. And to think if need blockchain, or if something simpler will do, like for instance the CES, or printing paper.
Then there are all kind of different design elements, like the governance of a system. When understand money is not god-given, these issues become open questions. Important are also the experiences we currently have. Many local currencies will pay tax in local currency, as its still worth doing so. It is when designing money which is based really on other values than economic value, that it raises questions. Leander saw the timetax as a creative answer, but for Leander, if a currency already contributes to the common good should there not instead be tax exemption (if taxation is about redistribution of gains by actors not contributing to the common good).
At the moment money is not telling anything usefull about what is happening our world. The more currencies we will come to be using, the better we will be getting at telling what is happening. There are a whole lot of great ideas with regards to currencies out there, unfortunately coming to an experiment with a currency is a very intensive long term process starting from the explaining of the idea, why people should use it, explain about money as we know it, get it functional and operational, so with regards to most ideas we will never get to know what they have to offer.
There was no time to discuss the 3rd International community currency conference held in October 2015, in Brasil where Leander participated, but here a link to all the papers there, http://socialcurrency.sciencesconf.org/
Following the presentations, three groups were formed for the breakout discussions: 1) on blockchain-technology, 2) timebanking, and 3) the nature of a local currency in Lapinlahti.