EDE Curriculum 2012.pdf - Gaia Education

Module 4: Community Banks and Currencies
Learning Goals
� Analyzing an understanding what money is and how it works
� Gaining case study insights on how different ecovillages and other communities (intentional
and conventional) around the world have managed to develop flourishing local economies
� Providing practical operational information on how to set-up and manage community banks
and currency systems
Content
The way that money is created and circulates is a principal driver of the current un-sustainable global
economy. Banks in the form of loans create the great majority of money in circulation, with interest
attached. This necessarily builds in a growth imperative, as all borrowers need to increase their income
to repay capital and interest. The interest payment mechanism also distributes money wealth
from the poor (borrowers) to the rich (lenders), thus further exacerbating income inequalities.
At the international level, the deregulation of financial markets begun in the 1980s enables capital to
move anywhere on the planet at the touch of a button. This has dramatically increased the instability
of global financial systems, as illustrated in the 1998 and 2008 financial crises. In addition, local communities
and fragile ecosystems alike are made vulnerable, as businesses can be rapidly transferred to
new locations offering lower wages or slacker environmental regulations.
Much work has already been done to develop models for monetary systems that promote greater resilience,
equity and ecological sustainability. These involve a number of different features:
� Re-introduction of controls over international capital flow.
� Better control over the lending policies of private banks.
� The introduction of multiple currencies operating at different levels: community, city, national,
regional, global, and
� The creation of an international currency to settle trade that is independent of all national currencies.
The fewer locally-provided goods and services there are, the more money leaves the local system and
the less there is to circulate locally to buy from and invest in local businesses which will, in turn, find it
more and more difficult to produce in order to satisfy local ne Eds.
Economist Richard Douthwaite explains: “If people living in an area cannot trade among themselves
without using money issued by outsiders, their local economy will always be at the mercy of events
elsewhere. The first step for any community aiming to become more self-reliant is therefore to establish
its own currency system.”
67