Tuesday, March 22, 2011

Pound for Pound

From http://www.vivalewes.com/ Nov 2008

The launch of the Lewes Pound has been the biggest thing to hit town since the boycott of the Lewes Arms all those months ago. The Pound's website promotes it as way to keep money in the local economy, cut carbon emissions and strengthen relationships with local traders. Though coverage has been everywhere (local and national) there has so far been very little discussion of what the Pound can realistically achieve. Lately I've been wondering: when all the razzmatazz, and eBay auctions are over what's the Pound really worth?

The argument that the Pound keeps money local goes something like this. Did you realise that the Lewes economy is like a bucket full of holes? Money that comes into Lewes is leaking into the globalised world beyond. The Lewes Pound will address this by ensuring that a portion of the money in circulation can only be spent in local businesses. This should maintain (and perhaps increase) spending in local shops. Just how many Pounds circulate in the local economy depends on how many people pick them up in the first place and on how many of those keep using them after the initial buzz. The arrangement is envisaged as permanent though of course it’s possible that, after dealing with two kinds of money for a while, a portion of people may find this a hassle and revert to regular cash. Though the plan is optimistic, the evidence for such complementary currencies may be less encouraging. It suggests that they have their best chance of catching on when physical money is scarce and large numbers of people really need a substitute. They literally stop money going out of town. In a country with plenty of coins, notes and plastic there just isn't the same necessity for an alternative, and complementary currency is far more likely to remain a novelty. After all people already have a way of supporting local business.

This support is given via regular money but an aim for the Pound (assuming enough people use it) is to increase the amount spent. However, here it runs into another problem. What about all those times when buying from the shop down the road is undermined by price, product range and all sorts of other factors which influence us weak-willed consumers. If you don't have a lot of money to throw around, the hole in the bucket that leads to Asda might look quite attractive. Sadly, in Lewes many small traders selling core commodities, like food and electrical goods, haven’t been able to compete in recent years. Against such forces what chance for the Lewes Pound? The example of the Totnes Pound (on which the Lewes Pound is based) is instructive. It maintains a steady circulation which implies that it at least has a number of committed advocates who keep putting it out there. However, is far from clear that it has increased spending in the local economy. In fact its circulation might just as easily mean that the market for local goods and services is fairly stable and unlikely to be dramatically altered by these kinds of initiatives.

Of all the possible benefits of the Lewes Pound, cutting carbon emissions has been put front and centre. The assumption is that keeping trade local will help the environment. Much as I love the High Street, this is not always a straightforward case to make. Sure, people walk to local shops but they also drive to them. Supermarkets often (though not always) mean you have to drive, but then larger loads can mean fewer trips. Relative to the volume of stuff they sell, large stores may have fewer deliveries than small ones as their products can often be delivered in larger amounts. Also there is no obligation on local traders to stock local goods and the products people demand mean even corner shops have a global inventory. Strange though it may sound, even if shops do have more local goods, there is no guarantee that commodities from nearby have a lower carbon footprint than stuff flown in from abroad. Local vegetables may come from heated polytunnels or British apples could have been refrigerated for months. Anyway, if we're really serious about cutting emissions internet shopping can be a more efficient way, as many deliveries can be made on one journey. It’s often complicated to calculate the carbon cost of various shopping options and proposing a vague notion of “localness” as the solution to emissions is seriously oversimplifying the issue.

All of which seems to leave us making friends with local traders. Despite some instances of traders being hassled to accept Lewes Pounds by some customers, this may be one area where the people behind the Pound are onto something. Community development is something complementary currencies can at least potentially achieve if they get beyond being simply a curiosity for the middle-class. If nothing else Lewes Pounds will give us all something to talk about now the parking has been done to death. Actually, and maybe this is the real point of the exercise, they do more than that and have been a publicity coup worthy of a town that's been grabbing headlines since Simon de Montfort. Local trading is well worth shouting about and can be wonderful in myriad ways: not least convenience, services the big boys can't match, and gluing the whole community together.

The other side of the Lewes Pound, though, is a danger that complex problems are being addressed with a romantic fantasy of self-sufficiency rather than appropriate solutions. The survival of local business in the face of globalised competition is an issue that requires action well beyond temporary hype. We need to consider many solutions from high quality start-up advice for businesses to supportive local authorities. Transition Town deserve credit for having raised a flag: it’s down to all of us to work out how to keep it flying.

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