The Story of Bay Bucks
Printing Money, Making Change"You can't live if you don't have money," as the Living Theater famously chanted in the sixties. For those of us not living on wholly-owned solar subsistence farms, or holding advanced degrees from Tom Brown's Tracker School, this is undoubtedly true. We ply our skills, exchange our time and energy to make money so that we can buy the things we need. Hard to realize that the only thing backing those hard-earned federal dollars is the widespread, but by no means guaranteed agreement to believe they're worth something. They're what is known as fiat money. Those federal bucks haven't given you a claim on precious metal since l968. Fiat is Latin for "let there be," or "let it be done". Unbacked money is money because someone says it is. Its utility is that it allows economic exchange to go beyond geographic and temporal limits; it provides a measure of value.
Part of the excitement of Bay Bucks, our own local fiat currency, is that it breaks open the black box of economics, requiring everyone who participates to question their assumptions about money and monetary history. Did you know that the federal government only got its latest monopoly on currency issue in l913, when the Federal Reserve System was created? Or that the Federal Reserve System consists of private commercial banks, and that the way the Fed "creates" money is by lending it into existence, at interest?
Many folks are surprised to learn that local currencies like Bay Bucks, are perfectly legal and potentially very useful in giving the region's economy what "Going Local" author Michael Shuman calls a "Keynesian bounce." The beauty of local currencies is their limited recognition. Bay Bucks can't leave our locale except as souvenirs. At home, though, they can earn our full faith and credit by circulating and recirculating and facilitating a lot of local exchange. Not surprisingly, another term for such homegrown money is "complementary currency" Local currencies (of which there are scores in the US and abroad) are valuable and useful because people in the locality agree that they are and use them (Bay Bucks' locality is roughly the area contained within an ellipse whose center points are Traverse City and Elk Rapids).
The Traverse Area Community Currency Corporation, which has been working for the last two years to think through and organize the issue of Bay Bucks, is starting small, with an initial printing of about $99,000 worth of Bay Bucks which, for the time being, will be pegged to the federal dollar. The dollar may not go as far as it used to, but most of us, despite creeping inflation, share an idea of what a dollar can buy.
Bay Bucks are beautiful and durable, letterpress printed the currency. There are other security features in the bills -- which have been issued in four denominations: BB1, BB5, BB10, and BB20 -- in addition to Chad Pastotnik's high-quality letter press printing.
Launching a local currency in the Grand Traverse area is something that's long been a gleam in many a cultural creative's eye hereabouts. Various groups of friends have been discussing the idea since the mid-eighties. It took Chris Grobbel and Natasha Lapinski to launch the public meeting in 2002 that resulted in the formation of a steering committee. Members have come and gone, and the committee became a board upon the project's incorporation. Early on, Bob Struthers, general manager of the Oryana Natural Foods cooperative pledged support and a healthy donation as a start-up grant. Other community members too numerous to mention have supported Bay Bucks as well.
Because it's a nonprofit organization, democratically run by a small board of directors, all of whom are working on this project for love of the community and from a sense of adventure, Bay Bucks volunteers are interested in keeping the money circulating and will work with Bay Bucks members to find, or enlist suppliers or service providers who accept Bay Bucks. Doing this, we hope, will help weave together small business commerce in our region, and help establish a preference for it on the part of consumers in the region. Bay Bucks can identify opportunities for import substitution and help humanize our local economy. As Bay Bucks grows, opportunities for participation -- like attending potlucks, serving on the board of directors or contributing writing or art to the directory -- will, also.
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