By David J Weston
Money is a marvellous invention, enabling people to exchange
their labour and energy with others. When used with wisdom, it
can enhance a community; used foolishly, it can destroy a
Currencies reflect exchanges at different levels of society, and
depending on how the currency is designed and used, can enhance
or destroy value. Some are centralised; others decentralised.
What effect do centralised and decentralised currencies
have on economies? A great deal; for currencies act as
feedback loops to the area they serve, monitoring where energy
is needed. Centralised currencies extract value out of
hinterland communities into centralised banking systems in the
metropolitan cities. Allow a pound to be extracted out of your
community, and that is one less pound that someone in your
community could have spent in your community. It could be called
the ‘divider effect’. Centralised currencies usually benefit
elites in elite places. Decentralised currencies give direct
feedback, generating and regenerating local economic activity. A
decentralised or local currency will stay in a community
creating the ‘multiplier effect’ whereby the local currency
circulates and recirculates value. A local currency benefits
What lessons are to be learned from that analysis in terms
of the situation in Britain today? The English (rather
than British) pound holds sway on these islands, with the
exception of Eire, which has its own Irish pound, the ‘punt’,
which floats against the pound (but not the Euro). What would
happen if a community or series of communities, say within
Wales, were to create a Cymru punt for tourists to buy at a
discount with their English pounds? From the writings of Jane
Jacobs we learn that the lower value of the regional/local
currency would encourage exports, and because imports would be
more expensive, would increase import replacement, leading to
generation and regeneration of local industries, and of
Lexports — exports of locally created products and
services. The Cymru punt would activate the ‘multiplier
effect’ leading to a revitalised Welsh economy.
Can such a currency be created by a municipality?
Yes, any community in Wales, or even better a consortium of
municipalities, could resolve to create legal tokens to sell to
tourists to enable those tourists to buy punt funded, locally
produced, goods and services.
Depending on the commodity, some businesses might even
sell goods imported into Wales from the pound economy. The
implications are significant, and exciting. Such a model could
But the fear of those who control the centralised money system
is financial insubordination and independence, and they will
attempt to undermine our creative instincts. But that should not
inhibit us, for the history of mankind is the history of the
struggle between centralist and decentralist forces.
Paradoxically the centralised state put up the research money
which created the decentralised Internet by which we can
disseminate decentralised ideas. If we can implement these ideas
we will all gain. It will truly be a ‘win-win’ game.
CURRENCY DETERMINES SOVEREIGNTY
Throughout history, whomever has controlled
currency has determined sovereignty, where ‘sovereignty’ simply
means the ability of a community to make decisions at the
appropriate level, in the interest of its citizens.
Where the currency that circulates within a community is
an external one, there is an inevitable leakage of value and
energy. Thus the pound sterling, controlled by the Bank of
England, currently determines the economic fate of the countries
of the UK. In Scotland, the distinctive notes issued by the
Scottish private banks are tied to the pound sterling. When the
Bank of England sneezes, Scotland gets a cold….
Where the currency that circulates within a community is an
internal one, there is a retention of value and energy, and a
constant renewal of that economy.
So, how do we create and retain local and community
self-reliance? And how do we stop the
haemorrhaging of wealth from our community?
It is important to first analyse the way the leakage has
been, and is, happening, and thereby devise means of stopping
it. Understanding the role and flow of money is key, as ‘money’
is the energy symbol which represents the three factors of
production of labour, capital and natural resources and what
happens to them.
Essential to regaining control of the local and regional
economy is control of both its cheque book and its currency.
In Worgl, Austria, during the height of the last
acknowledged Depression in the late 1920s, early 1930s, the town
solved its unemployment within six months, and became a
prosperous community within one year. It did so by
creating its own community currency and spending it into
With the Worgl schillings, workers were
able to buy food, local farmers able to sell their crops,
materials were bought and all were able to pay their local rates
and taxes in Worgl schillings. The experiment caught the
imagination of 200 Austrian mayors who wished to emulate it, and
regenerate their own local economies.
But the experiment also caught the attention of the Austrian
National Bank which felt threatened by this example of financial
insubordination and independence, and through the Austrian
Supreme Court had the enterprise closed down.
This should not discourage us from creating a similar
enterprise. Jane Jacobs, in her Cities and the Wealth of
Nations (especially Chapter 11) highlights the
effectiveness and efficiency of city currencies.
A ‘WIN-WIN’ PROPOSAL
Is there a way that everyone can benefit: both local producers
and inhabitants, and those from outside a community? Yes!
Here is a proposal to stop the escape of locally created energy
value, of which money is a key expression, and to enable the
revival of local and regional economies by way of
Lexports — through the creation of a local/regional
We propose that since tourism is an export, it should be used as
the initial basis of creating the local/regional currency which
will eventually become self-reliant. In order to have a
distinctive unit of account, and to be able to distinguish
between the English ‘pound’ and the local/regional currency, we
propose to use ‘punt’, the Welsh word for ‘pound’, preceded by
the name of the region concerned — ie. Cymru/Welsh Tourist Punt.
Exporting via tourism, especially if it is ecologically
appropriate, would seem to be a sensible activity. It has the
advantage that the ‘products’ — the scenery, the local culture,
history, friendly people etc, and the services are all renewable
So, how to encourage ecological tourism
using a local/regional tourist currency?
THE POLICY DECISION
First, a local municipality needs to make the policy
decision to create a locally validated, and locally valid,
currency. This is not difficult, for creating symbols of value,
other than the pound, is common practice air miles, supermarket
tokens, green stamps, petrol stamps, barter cards, time pounds,
local authority repair chits, and others, like the Swiss Wir.
Many of these are created in addition to pounds, whereas the
regional and local ‘Cymru tourist punts’ (CTPs) because they are
exchanged for pounds, would be ‘instead of’, and therefore more
valid and legitimate than those above. The exception is the
local authority repair chit whereby some council tenants receive
two kinds of chits. One for the materials; the other for the
labour by which the tenants can either do the work themselves,
or give to a neighbour to do. These chits represent a tradable
local legal currency and highlight that councils can decide
politically to create tradeable chits even now.
Although this decision can be taken by a municipality, it may be
better taken by a consortium of municipalities. If it can be
taken in conjunction with, in this case, the Welsh Assembly, so
much the better, but its not essential. While we envisage
denominations of 1, 2, 5, 10, and perhaps 20 punts, we might
also consider local/regional ‘smart cards’ or even ‘tally
sticks’ for transactions larger than 20 punts.
Secondly, because currency can reflect the culture,
particularly for the tourists, consideration should be given to
creating truly beautiful local/regional notes as well as coins
all designed by local crafts people. Each interested
municipality could hold a competition for a local currency
design which reflects that locality. Also, a design is needed
which reflects the larger region eg. Cymru/Wales. For example,
the local side of the currency could have the picture of a
famous local person, or local scenery. The other side could have
a map of Cymru/Wales, a dragon, a flag, and any other symbols
reflecting the country’s attributes including its language. This
may encourage tourists to take them away as souvenirs — an export.
Thirdly, it is proposed that the Cymru tourist punt be
sold to tourists at a discount determined by the local council
and/or the Welsh Assembly; perhaps an experimental 5% to begin. A
tourist would receive 1.05 punts for one pound sterling. The
figure could be higher — but should be determined only by
elected, and therefore accountable, officials, and not by ‘the
market’ which is unaccountable.
It is recommended that the currency be sold through public
outlets such as Tourist Information Centres, local Post Offices
and local council offices. Consideration should also be given to
the establishment of other public outlets, like the Treasury
Branch outlets set up in the 1930s in Alberta, Canada, which
exist efficiently and effectively to this day. Further — and this
is also essential — the Cymru punt should never be allowed
to be speculated on, in any money market. If it did, it would be
sucked dry of its value, and all the effort of many years could
evaporate within days.
Fourthly, local businesses would be urged to accept these
‘Cymru tourist punts’. Those businesses that agree to sell goods
imported and paid for with pounds sterling will effectively be
giving tourists a 5% (or whatever is the rate) discount.
But it also means that they will get that tourist
business. The tourists would be able to buy goods in shops and
businesses for a literal 5% discount, by simply using
their Cymru tourist punts. Businesses would indicate for which
items and services they would accept CTPs.
At the end of a day any traders, should they wish, could trade
in their punts for pounds at a discount of a couple of per cents
higher than the discounted figure, as a handling fee. But
this may be unnecessary, as shown in the following….
Fifthly — and this is key — as this currency begins to
circulate, it will increase the possibility of businesses being
able to pay their staff partial wages in Cymru punts. That may
at first sound like a cut of 5% in wages. However, as the
momentum gathers and the circulation increases then local producers
like farmers, horticulturalists, bakers, cheese makers, beer and
cider makers, apiarists, wood craftsmen, potters, glass blowers,
and other local manufacturers will likely, as in Worgl, begin
to trade between each other in CTPs. Therefore, workers will be
able to buy those local and regional products at the same price
as before, because they are using punts. Within Wales,
therefore, it would be a level playing field. Further,
locals may decide to exchange sterling pounds for Welsh punts
and be able to gain from the discount. Businesses which
do accept the ‘Cymru tourist punts’ are giving a 5% discount to
the tourists, but that is for those products which are
‘imported’ with sterling pounds; but for goods and services
produced within Wales in punts, traders will not be giving any
discount at all. The tourists will still be getting a good
deal. Everybody wins!
So, commodities produced within the region such as beer,
bread, meat, could be traded in the local currency for local
consumption. It also means that these commodities are now
beginning to be produced at 5% cheaper than using the sterling
pound. That means that Lexports of these local
products will increase, bringing more prosperity to Wales.
Currency determines sovereignty, where ‘sovereignty’
simply means the right of citizens to make their own decisions
about the rules which daily affect us all.
This is why, if the Canadian Parliament — as they are being urged
to do by the American government — accepts the US dollar as its
currency and the privately-owned Federal Reserve Bank as its
central bank, Canadians will immediately lose their sovereignty.
Likewise, if the British parliament accepts the Euro as its
currency, Britons will lose their sovereignty to a
non-democratic, non-accountable central bank.
Likewise, if the
countries in Britain continue to accept the English pound
sterling as their currency, they will be denied the ability to
make decisions at the appropriate level. A community losing its
sovereignty is like signing all its blank cheques and then
giving them away! As individuals we wouldn’t do that, nor should
we as a community.
Let cities, regions and countries create their own currency
which reflect their own culture and their own economic destiny,
based on the principle that decisions made and actions taken
should be at the most local level possible, with decisions made
and actions taken at more centralised levels only as
Let Wales invite tourists to exchange their sterling for the
Cymru tourist punt at a discount which will be mutually
beneficial. They will be able to buy goods within Wales cheaper
than using sterling. Through the ownership and control of their
money the Welsh, in turn, will be encouraged to make and buy
local products. This will boost their economy, and their
exports, and provide local employment for local workers. This
really is a ‘win-win’ situation.
Copyright © David J. Weston, May 2000