Dollars and Common Sense - Issue #21 - Spring 2007
Dollars and Common Sense
by Christina Calkins
The notion of infusing simplicity into our lives can help us to become more thoughtful and in tune with our surroundings. When we educate ourselves and become more conscientious about how our decisions affect others, we begin to define our community as one in which everyone plays an integral role. Economics affects each of us but tends to be a discussion reserved for a select few who want to talk supply and demand. The reality is that we all shake hands with U.S. Dollars and becoming more aware of our relationship with it makes common sense.
We live in a society where the dollar seemingly shapes our daily routine. Sometimes it’s hard to imagine what life would be like without it. We work for it, save it, borrow it, and spend it. The dollar has become commonplace in our lives and makes it easy for us to negotiate for the things we need. As a tool it serves us well. Life might not be so easy if we had to arrange a direct trade with the grocer each time we needed to fill our cupboards. Easy as it may be, we often spend our money with a certain level of disconnect. Being more conscientious about how we spend our dollars can bring about not only benefits to us, but to the community as a whole.
Dollars have greased the wheels of commerce while the innovation and drive of people have kept the economy in motion. Never before in the history of man has the availability and selection of goods from around the world been so great. In a sense the economy seems to be robust and thriving but all of that is subject to change. Basic economics teaches us that the dollar is susceptible to the effects of inflation. That means the dollar you hold in your hand today could be worth 88 cents a year from today. Things cost more so your dollar is worth less. Typically inflation is tied to things over which we have little or no control, such as the rising costs of fuel and oil. These fluctuations leave us vulnerable to the rising costs of living. The real problem arises when the prices of necessities creep up while the wages you earn remain unchanged. On the national level solutions are few and far between. Locally we can narrow the focus and with a few new ideas and tools we can work with what we have here to increase the wealth and well being of the communities in which we live by defining the boundaries of sustainable community-based economics.
Basically, economics is the study of how goods and services are produced, distributed, and consumed. When we refer to community-based economics we are looking at those same things only more specifically at the local level. So, how about our local economy? Is it successful? How much reliance do we have on outside resources? How much do we import vs. export? When dollars flow into our area, how long do they stay? Is our local economy sustainable? And how is this important to me? It’s simple: when we start to understand how our dollars affect our community then we have more control in making choices in our spending that shape the future into a direction we would like to see.
One way to conceptualize economics is to think of it as a detective game called “Follow the Money Trail.” For example, think of the last thing that you purchased and imagine the dollars you spent as a pie. After your dollars were spent how was your pie divided? And then divided again? Who got the big piece? And who got the smaller pieces? How many pieces continue to be passed around the community? How many pieces up and left town to feed a fat cat off in a distant place? Community economics leaves us to consider the effects of the big picture and how we can interact and affect the picture right outside our front door. It’s a change of thought: Think globally, spend locally.
We all benefit from dollars circulating in the local economy. When we buy locally produced goods it increases the demand for local production, creating more jobs for people in our community. In turn, when these people spend and reinvest locally it is likely the money will come back around to pay us to do something that we enjoy doing.
Buying locally isn’t a new concept but finding tools that help close the spending loop is. This is where the HOUR Trader springs into action, becoming an asset to the community. It brings the tool of local currency onto the scene. It works by creating a valuable currency that is based on the real resources of people that live right here in our region. These local dollars aren’t intended to be a replacement for the U.S. Dollar but instead work in tandem as a complement to the system that already exists. Backed by local individuals and businesses, the HOURS currency is only valuable in our region, which means it stays here for us to use. HOURS recycle endlessly through the community making connections, expanding trade, and stimulating new job possibilities. HOURS have a real value and this adds to the local money supply, increasing commerce and trade. The network builds new friendships and trust between neighbors and businesses in our community.
Simple changes to our outlook on economics can be a benefit to our community as a whole. When a community is self-reliant we feel connected to the people and the place in which we live. When a region is self-reliant we can exercise more control over the decisions affecting our future growth and use of resources. The change in economic patterns enables us to make sustainable choices for our future. It’s a new idea based on an old concept but all in all it makes common sense.