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Million in a billion challenge

January 27, 2009 -

michael linton - mwl
ernie yacub - ey

00:35 ey - what can open money , community currencies, LETSystems do about issues like homelessness, hunger, and poverty? we are the comfortable ones and it behooves us to try and help those who aren't as comfortable.

1:20 mwl - indeed, throughout the planet there's an awful lot of need and there's a considerable amount of complacency or ineffectiveness - can't engage with how do we make a difference around here - with the increasing tightening of the economy, the break down of this, that, and the other, followed by job losses, collapse of real estate markets, needs are rising, homelessness is a growing problem.

2:13 ey - i remember when there weren't such things as food banks.

2:16 mwl - they were going to be temporary, free food banks for maybe a year and that was 30 years ago - it's getting worse, not getting better, the thing that's generally missing is the capacity of people as a whole to support the nature of our commons through means that were not historically supported by church organizations, by the village mentality, the village culture, the fact that we didn't travel far, people never moved more than a few miles from place of birth their entire lives - things tended to be local, integrated, not necessarily equitable at all, far from it, but a lot got picked up because people were looked after, but now with our nuclear family, differentiated society, our just-in-time economy, our layoffs and downsizing and relocations the identification with community is pretty much gone so the best we seem to have are united way, which is a good thing i suppose but my god, if that's the best we can do it's pretty pitiful.

3:40 mwl - if you look at our own community here, the comox valley, we're on the east coast of vancouver island, an hour or so away from the main hub of the island, nanaimo, we're in the residential, retirement, fringe farming, small industry and a defence base, that's our basic community of 60-70000 - if the average per capita income in canada is $20,000, local domestic product of wages earned, income from stocks, shares, pensions, insurance, products, whatever - about a billion dollars we go through every year, coming and going - on the whole, lets say we have a billion dollar economy around here - how much did united way manage to raise in the last few years in this community?  not that impressive, a couple of hundred thousand, less than 0.1% of our domestic product was converted into this particular initiative - now it's not the only thing that happens in the valley of course, there's a tremendous amount of contribution and effort, giving and supporting through church groups, service clubs, schools, parents, neighbourliness - but in terms of organized financing of the common good, we're stuck with the tax base and you know how bad that is, lots of money going around in circles and disappearing in odd places - not a hell of a lot of group coming together to build community - they used to say it takes a village to raise a child, they used to say a congregation could build a church, both physically and culturally...

6:27 ey - in some religious communities, hutterites, mennonites, still do that, barn raising, house raising.

6:36 mwl - yes, that's the most general, generic term, barn raising - how do we get a bunch together and do this - it might raising a barn, it might be cleaning up the park, holding a music festival, a whole group get together and do it - how do we get together and achieve something?

7:02 ey - how do we build enough homes so that everybody has a safe, comfortable place to live?

7:10 mwl - it is a startling reflection on the state of our community, how it treats those who are less fortunate than the successful, or the survivors - the people who are falling off the edge, the mentally ill, the people with disabilities, challenges, people who need support and help - what do we do about that in our society?  we outsource that to government, to the private sector, to somebody else, pass the parcel, not my department, i'm not doing anything about it - we've seen that in the valley over the last few years, increasing issues of homelessness and the continuing lack of hard, on the ground, substantial action - where's the money? is it coming from the feds? from the provincial gov? is it coming from municipalities, who's going to give up what? not us.

8:08 ey - municipalities are all competing with each other for a diminishing pot.

8:15 mwl - and the supposition that the money we're going to do this with comes from outside, everything seems to come from outside, doesn't it? how about looking at home base, at the slack in our society - of the 60,000 people here there are a bunch with full employment, well paid employment, there's an awful lot of us who aren't fully occupied, who are mis-occupied in some cases, busy selling newspapers to each other so that we can sell newspapers to each other round and round and round.

9:00 mwl - what can be done to bring the billions in your economy to produce something substantial in terms of community product, community gathering, community creation, the social capital of our community - we're going for the "mil from a bil" concept - from a billion dollar turnover, what's necessary in your community to produce a million of funds raised for community projects like homelessness, like food security, energy research, social justice, shelters for all sorts of people who need them, not just homeless but transition processes - we need a different housing stock, a different perspective on how we look after our selves, our own community.

10:10 mwl - we're going to use the standard community way concept - businesses create a pool of recirculating community currencies through donation to local good works, ventures, charities, causes - not just local, can donate to oxfam or malaria tents for africa.

10:38 ey - it would be strategic to focus this on a goal such as homelessness - that first million, because it keeps circulating, we're not just talking about the first million that's raised, that keeps circulating and building, but suppose we focus our attention here in this valley on what has been an intractable problem.

11:07 mwl - well entirely, but i think its useful to not identify the whole of that first million on the homelessness project - peg it around homelessness, maybe target half a million as specifically the homelessness target but also we are looking to raise $200,000 for this or $50,000 for that or $3000 for something else, small projects big projects - the target, how long does it take to get a mil into circulation in this world of community currencies because there's no end of applications its really a strategic issue of community by community - which one is the most attractive.

12:21 mwl - for instance in a major city, like vancouver, population base of 2 million at least 40 times as big as the comox valley, one might expect them to be a $40 billion dollar economy - ok, lets make it 50 billion domestic product, the net flow through, personal assets and earnings - how much do you earn and spend, how much comes through your world - we're not talking about just the businesses, quite often the money will flow into a business and then straight out to another part of the world, looks good on the books but its not doing anything for the quantity or quality of the local economy at the wage level, personal income and expenditure - their target in a 50 billion dollar economy would be to raise $50 million in multiple projects - it would be quite obscene to put all that into one place.

13:51 ey - i didn't mean it should all go into one place, i was thinking strategically here in the valley its a good focus - as you say half of a million dollar target is focused on a major intractable issue but of course the choice in a community way program, the businesses choose who they donate their community currency to.

14:40 mwl - precisely, the danger of enclosing the concept which could happen if people get too excited about save the forest or we're going to do it for the women's shelter, something very specific - if it gets identified as singular to one thing, then the next stage has to break out of that mold into multiplicity and diversity.

15:14 ey - the multiplicity is built right in community way - variants might want to do it differently but the way we've designed it, we're talking about a multiplicy, its open, businesses choose

15:35 mwl - they do indeed and yet there can be strong focus - for instance, a particular service club might choose as that service club to focus on one strand or one thread of this weave - a chamber of commerce must be widely spread, most productively look for diversity within its own constituents - we have 1500 members in our chamber thus we might expect 500 to be immediately involved but their interests widely spread but the chamber can also reach out to the rotary club, the other service clubs - it could do all sorts of cross linking.

16:40 mwl - its important for people to understand that this is a portal to open commons and that requires the breadth and variety, clearly part of the initial set up - go in any direction but lets look at the possibility of resolving the first step in the project of homelessness - maybe raise half a million locally because its not happening yet, not coming from the feds and its not coming from the province as fast as it needs to so we have to look to ourselves and that practice of finding our own social capital, our own social effectiveness our ability to support our own economy with our own money, that's a worthy exploration in itself - so we're going to be talking around our town, reminding people where we've been before - this comes out of LETSystems, the development we've done in the last 20 years, out of the community way model, the initiatives we did in the late 90's, early 2000

17:53 ey - we're about 15 minutes into the show, we have an hour if we want it, we said we were going to probably cut it off in half an hour but if there is anybody out there listening you can call in, 646 716 9424 or pick us up after by email - ernie at - mwl at and we're all over the place as openmoney, twitter, friendfeed, facebook - join in the conversation about community currencies, open money, LETSystems

18:50 mwl - all over the place could perhaps be our tag line - we are a very distributed and widely focused project - development of open money is a multi-faceted project and we're trying to address as many facets as we can with the limited resources that are available on the grounds that diversity, growth, evolution, emergence is quite unpredictable and we need to feed all the bases to make sure the possibilities are there - hitherto, that has meant go local and try hard either in your own home base or recamp to another city - in our case we have tried vancouver, victoria and other places to raise interest but they have been one shot deals, one here one there one here - the most recent developments of the open money platform open the significant possibility of distributed networks - a community way project need not be just local to one city, village, town or region - community way projects can be happening nationally and internationally - major corporations, airlines, telecoms, shipping, food, pharmaceuticals even, who knows, any corporations doing business around the world should start looking at how its doing that business.

20:43 mwl - the nonperson that is a corporation, when that nonperson comes in the room, just like a person, you want to see what they're bringing - somebody says we're moving into your community, what do we come for?  too often the corporation has come to take, an entity that says here i am and i'm here for the money - after all i'm a mindless, empty, unethical collection of people driven by shareholder value, i would be wrong to do anything else except maximise my profits at the expense of anybody i can beat in the competition, them's the rules - well those are not particularly convivial rules and the entry point for a business coming into the community of common money, of open money, of collaboration is about what am i here to give, what do i bring to it - so if we're looking at how a corporation becomes real - you may recall a story called the velveteen rabbit only became real when it was dog-eared and loved very much.

21:58 mwl - how does a corporation become a real person and begin to express the moral values and behaviour that we hope for from our neighbour, our friends, family - we expect people to have some moral standards apparently we don't require that of corporations, not compatible with the capitalist single currency model but in community commons, in the open money world a corporation is known by its behaviour, emergence of its character, personality, so if you're going to be a good corporation, you start by giving - you come to a community and what you say is "we bring" and the first thing a corporation can bring the new market of open money in the wider world is their contribution in community money, their gift - they can commit to this money rather than try and suck it and that's a major shift in personality.

23:05 mwl - we can now be all over the place, make these ideas compatible and available, not just in western societies but also in africa, india, latin america, in china - it should be perfectly feasible for people to adapt these basic ideas to work out their own version of a mil from a bil - can they get one thousandth of their economy to support their community as a whole - we want to see first a dozen, maybe a hundred, then thousands of these around the world undertaking this challenge - we've all got billions going by, can we find a way to tune just a few mil in the right and effective directions.

24:08 mwl - this has parallels in the national governments and their commitments to foreign aid, i think we're supposed to be aiming at 1.1% of gdp and we're probably around .3% of gdp

24:28 ey - and that aid goes to canadian corporations doing business in these places - its not even aid.

24:42 mwl - in many cases it is aid, gifts and grants, products are shipped, value is created and transferred but its done in such a way that its inside government and financial corporate bureaucracies and its pitiful and self-serving - we only ship the aid that feels good to us, serves our corporate interests - want a nuclear reactor? boy have we got a deal for you, we'll give you aid - well, we need to go beyond that to have a much more effectively integrated world.

25:17 mwl - so that's our game, mil for bil, and we're starting locally and we're encouraging others to start looking at this project and to start scaling their own initiatives - its not enough to raise 50 thousand dollars - that's terrific, but its not enough if your economy is 50 billion dollars - 50,000 is trivial, good as it is but not enough.

25:56 ey - and also the little scales, because the open money platform provides a way for anybody anywhere to create their own community currencies and invite others to get accounts - its an account based system on the web and so villages in africa or bangladesh or anywhere in the world where there is a connection - it can be a cell fone in a village or region connected to the internet that provides community currency services to the people in the village who want them.

26:43 mwl - and many other tools and facilities exist that will help us to get this show on the road and sometimes the technology may not be as broadly distributed or immediately available or accessible - you know, there's nothing really wrong with paper if you handle a paper currency effectively - a paper carrier for a currency then various forms of printed currency can be effective components of a community way model and particularly given business interest in promotion, exposure, identification with their corporate social responsibility, to have some dollar bills floating around town essentially checks in community currency issued by business a, business b, business c, in denominations of maybe 50's, 20's, 10's, 5's, maybe even 1 dollar bills - why not, when did you last see a one dollar bill?  i know its common down south but in canada we don't do that any more, we do coins for one's and two's, the loonie and the toonie, we have a 5 dollar bill - well there should be a 5 dollar joe's grocery bill - something you can do with a check writing software to produce a series of numbered, documented, identified, printed checks - we can produce those for values created by this business through the community way of the comox valley - uniquely identified, perhaps cryptographic signature, perhaps some sort of thumbprint, water print on it that identifies the bill uniquely - it should have some security aspects because of course as soon as you're playing with paper there's risk of counterfeiting and false injection of money - people just cranking them out on their desktop printer - this will be less in small communities, more problematic in large ones - in fact, in cities we're a bit careful about that - the city economies are going to be talking about millions and millions of dollars and if even a fraction of that is in a paper form there is increasing risk of fraudulent replications that would undercut the value of the money.

29:53 ey - the thing is, because businesses set the rate at which they accept the money, they're covering their normal canadian dollar costs in any case.

30:10 mwl - well yes, if the currency system gets flooded with false money and the businesses that are finding this a valuable process and want to continue with it may choose to undertake even accept this clearly fraudulent money if they do it within their profit margin and thereby don't compromise the direct cash flow of the transaction - i'll sell you the groceries for 80 bucks in cash and 20 in this totally clearly fraudulent piece of nonsense because its easier than rocking the boat and it doesn't hurt me too much but it does mean that the businesses are just trading in discounts - their value added and their staff time is not being respected, they're gaining nothing that they can pass on in their expenditures, whereas if the money is good they take it in that 20% above their costs and then they can spend it for staff bonuses, additional product, for all sorts of things.

31.24 ey - for sure, definitely - i'm just pointing out that there are some fail safe in the system in any case even if there's some fraudulent money floating around but what that does bring up of course is that eventually the systems will migrate towards account to account kind of transactions and chip to chip transactions using smart cards and cell phones.

31:57 mwl - in fact, that's imperative - we're putting these mil from bil project ideas with a view to raising millions - most people won't be interested in the long term impact on our economy and culture - they'll be interested in raising a million for homelessness or this that and the other - that's their attractor, cash is raised, money is created, we get something done - from the point of view of the open money development world that's a side effect, that's part of the feature set - its a benefit, its good, its what makes the whole deal attractive to the public and the business community but our intent is to get a field of accounts out there, a context of businesses, community groups and people who are, whether they really know it or not, are already sort of attached to the virtual money network through the account base - one could start one of these things without accounts, entirely with paper, trouble is you've only got the paper and its quite a shift to get the people who are passing the paper around to think of it as a parallel banking system for virtual money but because we're interested in the multiplicity of the account base, the fact that when people are in one framework, those that are adventurous, or interested or persuadable will be able to join into multiple currencies and diversify these actions in many ways.

33:50 mwl - we're opening doors to multiple possibilities and we cannot do that by creating a singular space, we have to have the account base - so any form of paper that is used in support of this and i'm pretty much in favour of a well organized merchant identification issue, the printed paper of your community, i think it has to be small scale and it  has to be looked upon as something that will eventually become art objects in the space, recognized artifacts and gradually they will get retired from service and disappear and will be replaced with smart cards, online phone wallets, nearfield communications, transactions like going past the bus turnstile you just wave the card and it automatically takes 2 or 3 bucks off it or whatever - these are the technologies that we have to move to if we're going to continually support diversity

35:01 ey - these are technologies that we could jump to - for instance, a group of smart business people in regina or ottawa or st johns could immediately get smart card equipment and smart cards with maybe an investment of 10 to 20 thousand of their own dollars.

35:40 mwl - that's very important to point out, this is not a question of a million dollar investment to distribute a platform that covers your area and then one by one the people and the businesses join in as they find it attractive - those are expensive initiatives - ours is so much simpler, the only people who need the equipment are the people who have already bought into the concept and that means that we can specifically apply the hardware to the places where its needed, the restaurant, retail store, and therefore the costs ramp up from a very very small wedge entry point, maybe 5 - 10 thousand dollars would be enough to get yourself going on the hardware and if it expands later to a million dollar enterprise well it does so because you have turned over that much transactions and the clear need and the resources to provide it.

36:46 ey - what we're talking about here, for instance in this valley, when the target is met, of raising a million new community dollars, business backed dollars - that's a million new dollars that continues to circulate within the community - i would really love to hear from an economist that's getting his phd at a university somewhere - what is the multiplier effect of such a currency compared to the so-called multiplier effect of normal, conventional money, hard money.

37:30 ey - its astonishing that no economist has addressed that very issue - they talk about the multiplier effect of normal money, goes around one and a half times, 1.6 time, 2 times.

38:01 mwl - often 7 times - on the national economy scale that is possibly true - somebody creates a mortgage in manchester and thereby there's cash created for bank accounts, spent and moved around - it may go through 7 or 8 transactions before it returns to a bank as settlement on a loan account whereupon the money is absorbed back into the space so you can get multiplier effects on the gross scale for a national economy of 5, 6, 10 - particularly industries that create more, ours create less but from the individual point of view the multiplier effect is a totally different thing - that's all very well for our national economy, everything i spend increases other people's livelihood, a bit, but what does it do for mine?  i spend some money, do i get richer?  don't think that's how it happens - what is the effect upon me, my multiplier effect?  in conventional money the answer is always 0, there is no multiplier effect, there is no feedback of any significance that says the money you spend will produce increased demand for your services, financial demand.

29:33 mwl - but with closed loop community currencies, mutual credit, community way, organizations like that we have a recirculating money and the multiplier effect is a curious function - i don't think it can be a discreet, identifiable we have a multiplier of 4 or 44, it will be closer to 44 than to 4, but what will it be when potentially its an unlimited, unconstrained, perpetually available feedback reciprocity system - whatever you spend in closed loop currencies shows up as demand and that demand is available for you to tap into your community money so the multiplier becomes somewhere between a lot and infinity - it loses its relevance as a factor, although it does point very accurately to the inadequacy of conventional money as a multiplier generator - it doesn't - i wish more people knew that.

40:46 ey - well that's what we're trying to do with this show which is openmoney on - i'm ernie yacub, the other guy with the funny accent is michael linton - people can call in, we're live for another 15 minutes - in the states, people can call in toll free 646 716 9424 or pick up the chat on blogtalkradio and drop us a note or find us out there at - it has all the archived legacy materials from the original letsystems site that has some brilliant stuff on it - as well as other sites like and - anyway all of that is at

41:52 ey - i'm ernie at and michael is mwl at we wish more people would examine community currencies from the point of view of their possible/probable significance rather than from the historical trivial projects and attempts - not so much trivial as singular and difficult - discount coupons.

42:34 mwl - the point is the old what's in it for me issue - the history of community currencies (cc) has not been at all encouraging for people who are looking for perpetual free ride or simple it will do it without our efforts initiatives - need to take some effort, know what you're doing, be intelligent about it - unfortunately the history over the last 20 years has been rather inadequate - its the singular issue, to get it right.

43:16 ey - we have talked about it, we've done a number of podcasts where we talk about things like toronto dollars, berkshares, ithaca hours and variations on the theme of centrally managed fiat-like currencies.

43:41 mwl - so we have to shift people towards the projection of possibility - i know that when somebody looks at our sites they're going to say these guys are out of date, amateur, low quality stuff in terms of presentation and style, amateur being we do it for love - we're happy to do it for money - so we need to invite people to look at their entry to exploring this in terms of what's in it for them - yes its a difficult exploration in that its not all cut and dried and shrink wrapped for you so if you thought of it as a treasure hunt, suppose this was an online game, pick up the clues, search with others in your social networks - find your way to the pot of virtual gold at the end of the virtual rainbow - if one sees it as a game, an exploration, then the inadequacies of presentation, production systems can be accepted and seen as an unfortunate but surmountable

45:19 mwl - if people recognized that by digging around they may make a huge difference to their personal well-being quite quickly - the effect of creating community currencies (cc) in your world could make a significant difference to your personal income and expenditure, the the quality of your income and expenditure, to the networks you're engaged in, to the basic security of your community, the social justice values, the comfort levels of decreased crime, increased employment - opportunities for youth, training, for seniours to be involved - one could go on forever about the qualitative differences that come from community money - like planting seeds in the garden and eating later, invest now, get later - those of you who are pricking an ear towards this or glancing at the issues, who are beginning to think about it - research, study, get engaged, get real.

47:03 ey - and also look at this as an invitation to join with the open money development group in creating something that certainly most people in the world can use.

47:24 mwl - anybody who uses money and could use some more.

47:35 ey - need a few more people pushing this wagon up the hill

47:50 mwl - check kashklash , hosted in the u.k. inititated by vodaphone for mobile carrier projects in europe - basically about what do we do next - we're going to be promoting this mil from a bil concept on kashklash - this will, we hope, introduce us to a wider constituency than existing community currency channels which have become a little petrified, a little sclerotic, already an aging community of conservatives - time for us to think outside boxes

49:14 ey - be bold and multiply

49:16 mwl - be bold old man, we're the boldy oldies

49:25 ey - people can still check in to the ning openmoney site - there's a little bit more going on there now than has been in the past - that's one place people could connect

49:48 mwl - people can connect without any difficulty - anybody who wants to find us should have no difficulty doing it, you know where we are, we're all over the place, ernie and michael, all over the place

50:12 ey - there's 9 minutes left but we don't need to fill it - there are transcriptions up of some of the previous blogtalkradio shows that we've done on something that people can help with...