A Magazine about the Hudson Valley’s local economy, published by Hudson Valley Current.

Paddle Your Own Canoe: How Currents Liberate Our Local Wealth

Austria was in a bad way in 1932. There was sometimes-violent political turmoil in the 1920s even before the Great Depression hit, and in 1931, the largest bank in the country failed as the country slid toward fascism.

In the small town of Wörgl, 20 miles from the German border, Mayor Michael Unterguggenberger had immediate local problems, as mayors often do. There were 500 unemployed within Wörgl’s boundaries, another 1,000 in the general area nearby, and 200 penniless families.

Meanwhile, there was work to be done. Streets needed paving, not everyone had water, trees needed planting. There were 40,000 Austrian schillings in the kitty, nowhere near enough. What to do? Spend down the available funds on social services and public works until they were gone?

Happily for Wörgl at that moment, Unterguggenberger was familiar with the work of a German economist, activist, merchant, and censored publisher who had died two years earlier, Silvio Gesell. The mayor decided to give Gesell’s ideas a shot. He put the 40,000 in a savings account that would back his issue of 40,000 in Wörgl’s very own stamp scrip, then used that scrip to hire people to do the needed work. There was only one catch: the stamps had to be spent within a month.

What happened next is still remembered as the “Miracle of Wörgl,” a rare bright spot in the region’s history at the time. The entire to-do list got done, plus a ski jump, new houses and a bridge with a commemorative plaque reading “This bridge was built with our own Free Money.” Six neighboring villages joined in; one of them adding a public swimming pool. It was determined that, since people needed to spend it instead of hoarding, the stamp scrip generated 12-14 times as much paid employment as schillings did. 

Word got around. Two hundred Austrian towns wanted to replicate Wörgl’s success. At that point, the Austrian central bank grew worried about the competition. The case was fought all the way to the Supreme Court, but the bankers succeeded in getting the issuing of “emergency currency” criminalized. (Four years after that, Austria fell under Hitler’s sway.)

Interesting, isn’t it? Stamp scrip didn’t fade away from lack of interest or fail due to any inherent flaw in the theory. People were spending it right and left, hiring their neighbors, and buying their products like crazy. Stamp scrip in Wörgl was deliberately eliminated just as it was catching fire and gaining huge momentum.

Central banks issuing currency (theoretically) backed by extracted precious metals and laden with interest are favored by control freaks for obvious reasons. Usury, the changing of excess interest, is advised against in every major wisdom tradition in history, yet we’re still taught to forget our own intrinsic worth and adopt “conventional wisdom:” “It takes money to make money.” “He who dies with the most toys wins.” (Wins what? One wonders.)

Money is a record keeping system, as it was centuries ago when people kept track of trade with marks whittled on sticks. (Hence, the short end of the stick.) It should not take money to make money. It should be as simple as using one’s intrinsic talent and energy to fill a need, then being able to meet one’s own needs in turn. That was the basic truth validated by the Miracle of Wörgl, and that’s what the Hudson Valley Current enables us to do together right here and now.

The Current was first exchanged for advertising space in this publication’s predecessor, the Country Wisdom News. Since then, its circle and circulation have multiplied till currents are now backed by any number of things: food (lots of that!), graphic design, legal help, health care, fashion accessories, hot sauce. Education in things like yoga and permaculture design. 

Unlike central bank scrip, Currents do not come burdened by interest rates and tied to (again, hypothetical) quantities of debt and inedible precious metals. Currents are a simple, community-owned way of keeping track as we exchange and share abundance.

So what happens if someone, thinking they’re getting away with something, joins the Current and spends down their line of trust, showing no inclination to earn Currents and get their balance out of the negative? That’s where the community comes in. The Current team will reach out to that person and help them figure out what they can do or produce and offer to the market. 

To quote Bard College professor Leanne Ussher, “Money is simply a coordinating mechanism. We can coordinate at the hyperlocal level, with trust and reciprocity, then we can access those resources we have locally that are underutilized. People need training and the chance to become social entrepreneurs and start something, create value-added; what they need is community support, and a local currency can access the collective community intelligence that can point us in the right direction.”

Ussher, along with Dr Michael Marks—a local currency expert from Pittsburgh—are tracking the performance and flow of the Current in a six-month study from March through September of 2020, to look at how a local currency can make a local economy more resilient during uncertain times, when our nation is heading into an economic recession.  “In a closed local circuit, if everyone spent all the Currents that they earn, then the income multiplier is infinite, at least in theory there should be enough money to go round.”

In an open US dollar circuit, imports, interest and fees enter the picture, can drain dollars away from the economy—let alone “capital flight.” Our resources are being siphoned off and spirited away, as surely as if someone had stopped in the Hudson Valley, sold a pile of whatchamacallits and then taken off without purchasing so much as a cup of soup. This actually happens all the time; think of tobacco companies supplying convenience stores and depositing the proceeds in big banks. It’s extraction.

Ussher says “Of course the real question is what resources do we have locally, and are we utilizing them effectively. We have spare capacity now with the coronavirus—unemployed, unused services, inventories building up, shop vacancies rising, investment falling, and businesses shutting—this all means a loss of income, which in turn, means a fall in demand for goods, services. We have to use the Current to mobilize this growing spare capacity. Let’s not allow an insufficient number of dollars stop us from this goal.”

While we are not yet in a position to separate ourselves from the larger economy; we can increase out trade with each other. Interdependence stretches beyond the Hudson Valley. But that doesn’t mean we can’t separate more and more of our exchanges with one another from the system that extracts usurious fees and interest payments from what could instead be simple, value-for-value transactions among neighbors.

It’s hard to see around the corner of the current economic situation, except to make an educated guess that it’s not about to start taking care of regular people at the expense of the usurious hoarders. We don’t have access to the levers that control it. We’re facing uncertainty on several fronts. 

So were the citizens who built that bridge in Wörgl. The same people who cracked down on them, ending the off-the-charts success they were having in dire times, ultimately lost the war. In our time, the odds are against what we are doing being made illegal anytime soon. And it still works; more opportunities to use Currents are arising all the time.

Let’s take our economic destiny out of the hands of those who could care less about us. Let’s use Currents as a way to build one another’s wealth and our own, and look around with satisfaction: we built these bridges with our own Free Money.

Who knows…maybe one day the history books will describe it as the Hudson Valley Miracle.