Local Government Partners
Obtaining sufficient income to support all the programs and projects that local governments (county, city or township) would like to do on behalf of their citizens is often a struggle.
What can they do to improve the economic health of their community? A good starting point is a “buy local” campaign aimed at getting citizens to purchase goods and services from locally owned businesses. Studies have demonstrated direct financial benefits, like this one by the American Independent Business Alliance (AMIBA). Money spent with locally owned businesses recirculates in the community over three times as often, known as the Local Multiplier Effect.
However, those results pale in comparison to those experienced by a pioneering town in Austria during the Great Depression. The town of Wörgl was experiencing great financial hardships which motivated the mayor to attempt a bold experiment. He elected to print and issue his own money (called a “stamp scrip” or complementary currency). His experiment was so successful that it became known as the Miracle of Wörgl. Hundreds of communities across Europe expressed an interest in replicating his program
History of Alternative Currencies and Voucher Systems
As this webpage on the history of the alternative currency and voucher movements points out, the success of that effort in Europe attracted the attention of one of the leading economists in the U.S., professor Irving Fisher, who said that “The correct application of stamp scrip would solve the Depression crisis in the U.S. in three weeks.” And while acknowledged as likely correct, fears of decentralization caused the FDR administration to reject it. Nonetheless, the potential power of rightly used alternative currencies can have a dramatic impact.
SCC has captured a number of other historical examples in the document Complementary Currencies In Use, including Wörgl and more, and have produced this 4 minute video that explains where the majority of money in circulation comes from and how alternative currencies and vouchers can help fix what ails us. A deep study of those historical examples led SCC to developing the Sustainable Communities Framework (SCF).
How we can turn local governments into Wörgl 2.0?
Applying SCF Locally
Local governments can enroll in the SCF program as a special category of non-profit organization, and dramatically improve the financial health of their community. More than just about any other kind of organization, local governments are in a position to drive adoption of local vouchers and the Sustainable Communities Framework, as explored in Part 3 of SCC’s article – Money – It’s Not What Most of Us Think. If a local government accepts vouchers, then by default, the rest of the community will do so, to the benefit of all. Which leads to the following strategy.
A local government can launch a buy local campaign that is effectively turbocharged (Wörgl 2.0), by first accepting the state vouchers (as an NFP) and then actively promoting it by recruiting and signing up SMEs, individuals and NFPs as follows.
- The local government agrees to accept the local vouchers for payment of fees and taxes, thereby legitimizing it for their community.
- They also agree to sell the vouchers at their central facility and on their website, thereby generating an immediate 40% USD commission in the amount of the vouchers sold, plus a matching amount of the local vouchers for an effective 80% commission, as spelled out in this not-for-profit (NFP) program document. This will generate much needed revenue directly into that governments coffers.
- And, as spelled out in that NFP document, that government can recruit others to establish an account with the voucher bank, purchase the vouchers from a variety of sources and purchase goods and services on that state’s voucher marketplace (a hybrid of Jiji, Craigslist and eBay). When any business recruited by that local government sells the vouchers (see this document about SCF and for-profit businesses), that will generate a 10% USD commission override to that local government, plus a matching amount of the local vouchers. If the government recruits individuals, students and teachers to sign up, then a commission of 40%/40% which will be earned with each purchase of the vouchers done by those individuals with the UNIEX bank, the UNIEX marketplace or from the local SCF.NG website. Collectively this means that the local government will earn a substantial portion of the voucher sales that go on in their community, generating significant revenue.
- In addition, MSCF can arrange to provide voucher grants to support infrastructure projects (a la Wörgl) work force programs, day care services, business incubation services and more. That was at the heart of the highly successful Wörgl experiment, the key difference being that a third party issued that stamp scrip instead of the local government.
- It all begins with the local government signing up as an NFP and then working with MSCF to establish a comprehensive program in their community. Click the button below and start the process.