Re: interLETS exchange

On Mon, 16 Sep 1996 John CROFT wrote:

>There is a problem here and that is that we are again anchoring the
>measure of value (i.e. money) against a specific commodity (i.e. silver). 
>The amount of silver available, and the price it gets on the market, will
>determine the value of that money.

Please read postings carefully enough to understand them, *=! :-)
rather than immediately shooting from the hip. <:-(  In the Alta
California system labor value is not permanently tied to the value
of silver, but was specified at one moment (New Years 1995) so as
to establish continuity with the historically dominant monetary system. 
It was then immediately decoupled as I stated:

>> The rules of change are (roughly) that the average earnings of labor
>> (seasonally adjusted) in industrialized areas should remain constant
>> when specified in emus.  This labor-based evaluation means that
>> the long-term prices of tangible commodities will constantly decrease
>> because of technological advances (including gold and silver).

>"Technological advances" to date have only shown a decrease because
>the value of fossil fuels (another non-renewable resource) is
>consistently undervalued.  When we use "energy units/per quantity of
>material extracted" many of the values that seem a technological
>advance, in fact seem to be energetically a move in the wrong direction

Technological advance is most often measured by something that
correlates to labor value, because labor time is something that
people intrinsically value.  The labor time required to extract
a given quantity of materials has been generally decreasing.
Because this is a strong refutation of the most common technologically
pessimistic position, the pessimists  - :-(( - have to change the rules
of the game by evaluating things in terms of some non-human value that
will support their position, such as the energy used for raw material
extraction.  Despite continuing advances in the overall efficiency
of production, the amount of energy used per capita has been expanding,
mainly because energy is a relevantly abundant resource. Energy
use can still be greatly expanded, because so little of the total
solar energy falling on the planet is actually captured for use.
There is a legitimate concern, of course, that the energy cartel
has been distorting the direction of appropriate capital investment.
This is best addressed by pointing out good options, however,
rather than by making unsupportable pessimistic generalizations.

>> Labor-basing allows the practical use of antiusury principles
>> specifying zero interest within strongly bound communities.

>Perhaps, but not always (debt slavery systems historically were
>sometimes based on labour basing systems, in which "interest"
>payments resulted in debtors selling themselves or their families into
>bonded labour.)

The kitchen knives that I use to cut vegetables can also be used
to stab people, but so what!  -  <:-(

I see that that the only other person directly responding
to this question (Richard Kay - Mon, 16 Sep 1996) states
a position almost identical to mine:

>In my view the most promising sustainable approach to this requirement
>involves setting the base unit as the minimum hourly wage rate acceptable
>within the community for an hour's fully involved and skilled work using 
>this currency.

John CROFT continues:

>Warehouse receipts may work, but what about production trends that
>are shifting off conventional systems to "just-in-time" production
>processes not needing large warehouse inventories?  And what about
>the decline in world food stocks reported by Worldwatch Institute?

The world needs sizable inventories of basic materials to deal
with potential disruptions of production.  Monetarizing inventories
is a good way to counteract an excessive bias toward "just-in-time"
production (though basic materials have been less influenced by
the "just-in-time" philosophy than have rapidly changing commodities).
The decline in world food stocks is best addressed by accelerating
the trend toward less production of meat. 

>Obligation to pay from future production assumes future production value
>is going to be equal to or greater than the value of present production. 

NOT TRUE!  -  <:-(  All it assumes is that future production will be
far enough above a subsistence level for payments to be ethically

>While this has been historically true, it may not be true for the medium to
>long-term future.  If we are to move to a steady state economy, then we
>will come to a stage where expansion is impossible.  If it is true, as
>Donella Meadows et al suggest in "Beyond the Limits", that in significant
>resources we have crossed the threshold from living on our
>bioshpherical income (what is infinitely renewable), and have started
>consuming our biospherical capital, then an obligation to pay from future
>production will be a recipe for long-term slavery.  Already it has been
>estimated that human beings are consuming living resources at a rate of
>40% the full photosynthetic potential of the planet.  With population
>increasing 100 million yearly, and a revolution in rising living standards
>underway in South and East Asia, any bets on how soon we hit 100%? 
>What then?

There is a lot resting on your "if" clauses.  Meadows, et. al., have
based their models on an unrealistic freezing of advances in science
and technology.  They have been well criticized in the literature
for this, and the predictions of their school of thought have already
been well falsified by experience, yet their "politically correct" views
are reasserted as if they were true.  I and most futurists are quite
willing to bet that the "photosynthetic potential" of the planet will
keep ahead of the "population" for a long time, because of increases
in capital investment and the use of more efficient technology.

The main danger of losing the bet is from a sudden climatic shift
toward ice age conditions triggered by a massive volcanic eruption.
Monetarizing inventories of food and basic commodities and developing
an economy with a flexible response capability is the best way
to confront this danger.

>What we need, I feel, to help us guide our way out of the morass that
>this suggests, is the creation of grass-roots, local environmentally
>responsive currencies, as we find with LETSystems.  International
>trading can then grow from the "bottom up" as it should, rather than be
>imposed by fiat from the top down.

This is an example of a false dichotomy.  -  <:-(  Flexible response
implies having capabilities at many different geographical scales.
These can develop in parallel rather than either growing from the top
or the bottom.  While overcentralization of power is definitely a vice,
so-called "grass-roots" efforts tend to be too parochial and dominated
by pseudoscientic mythologies to be effective.  When change does occur,
some community transcends bickering and presents a rational and positive
enough vision to provide leadership.  This community may be either
local or geographically extensive.


 *larens imanyuel*

 University for the Earth                manuel@stat.berkeley.edu
 2155 Acton Street, Suite 3                  Tele: (510) 548-5238
 Berkeley, California, U.S.A. (94702)