Meeting each others needs
Dear Editors,
As I run a LETSystem in Canterbury I was amused to read Adam Buick’s article "LETS Abolish Money" in your December issue.
Despite Mr Buick’s evident dismissal of the very concept of LETSystem I was amused rather than perturbed, because even with the research that he had evidently undertaken it is clear that Mr Buick simply fails to understand either their ethos or their future potential. This is not at all unusual. LETSystems are so simple that a great many people have difficulty in understanding them.
Mr Buick dismisses LETSystems for being small, or rather for the twin reasons that they are small and that the range of goods and services that they offer is limited. That they are is undoubtedly true, but there is a very good reason for this. LETSystems are a new phenomenon. most individual ones are very young, even the oldest in Britain is no more than four or five years old. I don’t suppose that even Mr Buick was a towering and influential socialist intellectual at the age of five.
Having grown to a membership of 200 in less than twelve months the Canterbury LETSystem is beginning to attract the interest of "high street" businesses whose own involvement is likely to increase the system’s appeal, even to ordinary people (i.e. other than middle-class hobbyists and New Age dreamers).
As the system grows in size it will become more rather than less able to pay people to run it and still be far more efficient than the conventional, money economy which requires approximately 10 percent of its workforce to be employed in "financial services".
There may well be an optimum size for any given LETSystem, the bigger they are the more services they are likely to offer and the stronger and more credible they are likely to be perceived, the smaller they are the more intimate they are and the quicker will a person's spending come back to them as earnings. But we do not need to arbitrarily impose limitations upon a system, its natural dynamics will enable each system to find its own optimum size, which may number in the hundreds, the thousands or even the millions.
Beyond these matters, which essentially pertain to the practical aspects of establishing and running a system. Mr Buick's most striking failure is his inability to understand the long-term potential that LETSystems have for converting the present-day market-dominated society into an egalitarian one where everyone’s needs can be met, their dignity maintained and where the environment can be protected. Trading with a LETSystem is not barter, Indeed, use of cash is actually closer to barter than is use of a LETSystem. The Pound Sterling is derived from an entity of intrinsic value — a pound of Sterling silver. So when you use cash you are exchanging one item of intrinsic value (or rather a paper representation of it) for another, which is precisely what bartering involves. By contrast, the credits that one earns or spends in a LETSystem are purely abstract measurements. That they are given a nominal value, usually in relation to the Pound Sterling, is solely to enable everyone to share a common valuation.
This purely abstract nature of their units of currency underlies one of the great advantages of LETSystems. Whereas if you are exchanging cash for goods or goods for cash you have to have one or the other with LETSystems you don’t. You can spend LETS units before you earn them, even before you are able to earn them. Given the strongly inculcated resistance that most people have towards going "into the red" new members of the Canterbury LETSystem are positively encouraged to spend, spend, spend!, for by doing so they are putting credits into other people's accounts which will further encourage them to spend and so increase everyone's opportunities to earn.
Within a LETSystem the sum total of everyone’s accounts at any one moment will always be 0. So for some people to be in credit it is necessary for others to be "in commitment", this differs from debt within the conventional economy because it is not seen as being irresponsible, it is necessary if trading is to take place.
It is this feature of LETSystems that will enable the market economy to continue to meet people's needs (or rather be the means by which people will continue to meet each other's needs) whilst causing it to cease to be a means by which some people can attain power over others.
Mr Buick’s statement that "A hoard of cash is no more useful than a large LETS credit balance" is an extraordinary one to come from anyone other than a contrite capitalist apologist, if some people have a large hoard of conventional money (in whatever form), given that there is a finite amount of it, other people must have little or none, and given that one must have it even to meet one's basic material needs, clearly those who have the stuff in large quantities have enormous power over those who haven’t. By contrast, given that LETS credits are purely abstract measurements with no limit and given that one can spend freely even with a “negative" balance no one with a large LETS credit has any power over someone else who might, at a given moment, be in commitment.
If, as Mr Buick proposes, the elimination of want is to be achieved by the elimination of the market system whereby people exchange goods and services to meet their needs, how will these needs be met? By a central economic authority with complete power over everyone's lives? Mr Adam Buick?
We can retain the benefits of a market economy whilst removing its current absolute dominance and less benign aspects, we can enable individuals and their local communities to secure greater power and responsibility for their own lives, we can remove the inefficiencies and environmental destructiveness of an excessively competitive society and so achieve the type of society that is the dream of many, whether socialists or not. by the very simple idea that is the LETSystem.
After a myriad of Utopian dreams have come to nought down the centuries we now have the means of creating a just and egalitarian society.
Anne Belsey,
Faversham, Kent
Reply:
Your letter illustrates perfectly the point we were trying to make: the exaggerated claims of the benefits and possibilities of LETS made by some of its enthusiasts. You see LETS as a means towards creating "an egalitarian society where everyone’s needs can be met. their dignity maintained and where the environment can be protected". We are all for creating such a society, but say that LETS schemes will only ever play a marginal economic role.
For LETS to replace "the present-day market-dominated society” they would have to spread out of their present field of personal services, repairs, home cooking and gardening into, and the list is not exhaustive, farming, the generation of electricity. the provision of water, gas. sewage and telephone services. the manufacture of the cookers, fridges, heaters, cars, bikes. TVs. radios, computers (that LETS members merely repair not produce), not to mention the manufacture of the machines and equipment to make these consumer goods and the maintenance of a transport system to move them. They've got to take on and beat economically the public utility companies, the supermarkets, the multinationals and Big Business generally. We are sorry to have to break the bad news to you, but LETS schemes are not going to do this. They are never going to spread outside their present restricted field and even there they are never going to predominate.
This is because LETS are essentially an arrangement for conducting multi-sided barter amongst self-employed individuals. This means they are going to be restricted to the sort of things an individual can do. It also means that they have little interest for those in full-time employment with an adequate wage or salary. (For such people it is always going to be more convenient to pay someone to repair their TV out of the money they have earned than to commit themselves to a couple of hours extra work to exchange for this.) In addition, as the article stated, above a certain size LETS schemes become more cumbersome than resorting to ordinary money. This is not a defence of conventional money, merely recognition of a fact of life within "the present- day market-dominated economy”.
Our answer to the market economy is not to reform it as you want but to abolish the market. No, this does not mean some central economic authority deciding what people need. We envisage a self-regulating system of production for use. in accordance with the principle “from each according to their abilities, to each according to their needs", with individuals deciding what their needs are. On the basis of the common ownership and democratic control of all land and industry, individuals would set the productive system in operation by what they actually took from the common stores to satisfy their needs under conditions of free access; this would then be transmitted to the stores' suppliers and from them to their suppliers and so on down the line and throughout the whole network of productive units.
Finally, don't get us wrong. We are not saying people shouldn’t join LETS schemes, nor that they are a complete waste of time within the present economic system. What we are saying is that they are merely one mechanism for surviving within the present system, on a par with housing associations, coops, building societies. Christmas Clubs, etc. People can join them if they want, but they should be under no illusion that they contain the germ for the transformation of society.
For this to happen, the large-scale socially-operated industry where the bulk of the wealth of society is produced today must first be taken into common ownership and democratic control. And this requires society-wide political action, not what our next correspondent calls "practical small-scale change” which leaves the commanding heights the economy in capitalist hands. - Editors.
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