Read free. How to Build Healthy Community Economies, by Thomas A. Greco, Jr., 1983.
Introductory Pages
AI Summary
This guide explores strategies to create resilient, self-directed local economies. Greco challenges the centralized, debt-based monetary system and promotes community-controlled alternatives such as mutual credit systems and local currencies.
What Is a Community?
A community is based on enduring human relationships, not just location. Economic interdependence and cultural identity form the foundation of healthy communities.
Problems Facing Local Economies
- Local producers must compete with large, subsidized external entities.
- Big players dictate trade terms and extract local wealth.
- Local money leaks out rapidly, weakening communities.
The Role of Money
Modern money systems are centralized and debt-based, causing:
- Artificial scarcity of currency
- Dependence on banks and external capital
- Incentives for continuous economic growth
Key Strategies
1. Mutual Credit Clearing Exchanges
Groups of businesses form trade associations and keep internal account balances. Trades happen without physical money or interest. Example systems include LETS (Local Exchange Trading Systems).
2. Community Currencies
Local currencies issued by governments, cooperatives, or businesses that are:
- Locally circulated and accepted
- Redeemable for goods, services, or taxes
- Free of interest and under community control
3. Currency Issued by Spending
Local governments or businesses issue new money into circulation through payments to workers or vendors, backed by future revenue (e.g., taxes or sales).
Best Practices
- Only issue currency that you will accept back in full.
- Keep currency supply in line with expected future income.
- Ensure transparency in accounting and circulation.
Benefits of Local Exchange Systems
- Strengthen local economies with better liquidity
- Encourage local production and import substitution
- Foster equitable business relationships
- Increase resilience to external economic shocks
Common Pitfalls
- Insufficient circulation or redemption options
- Too few participating members or offerings
- Lack of transparency or trust
Conclusion
To build healthy community economies, Greco urges the adoption of interest-free mutual credit systems and local currencies. These alternatives reduce dependency on centralized banks and help communities manage their own economic futures.
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