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Read a news article on Mountain House Action Group's activism on foreclosure help: Foreclosure Help in Mountain House on Monday (August 14, 2009).

by Jennie S. Bev

Bailout after bailout, things haven’t shown any significant progress except for a few momentary upsurges in the Wall Street, while the whole world seems to be in the same boat. The recent G-20 Summit might have been another “rock star” performance for The Obamas, but the results have been vague.

Following the banking crisis, the real economy in which goods are sold and products are manufactured is next in line to sink deep. Credit crunch has hit businesses and individuals, which have been causing the economy to stagnate even further. Regardless of government bailouts for banks, credit will be hard to get for many more years to come. Thawing credit will need much more than a microwave, apparently.

Current U.S. unemployment rate of 8.5 percent is the highest since 1983. In California, February unemployment rate is 10.5, which is the highest in the country. Many analysts and economists said that things can get worse before it gets better. It seems that the whole world has trusted the governments to make some important decisions for us and, apparently, they failed big time.

Should we, the citizens of the world, leave our fates in the hands of public policy makers or are there options to help ourselves?

The recent G-20 Summit did not result in any coordinated stimulus plan and the pledged super-sized IMF with extra $50 billion will, as usual, come with many strings attached. On April 8, 2009, Switzerland agreed to grant an additional $10 billion to the pool. The Summit did, however, result in a consensus to use a more balanced approach in regulating the market. The market remains free but it should be fair from now on. Still, it didn’t give any immediate solutions for small and medium-size businesses.

Bernard Lietaer, a Belgian economist and author of The Future of Money said that we are experiencing an unprecedented time, in which four elements are converged: financial instability, climate change, unemployment and an aging society. He suggested two ways to swim against the stream in bad economy: waiting for government’s “Godot” rescue or proactively helping ourselves.

Government rescue takes time in providing solution as working guidelines and instructions require stern oversight and entities have their own interests that would create some sort of “negotiation war.” On the flip side, an excellent successful case of self-rescued plan was the employment of complementary currency by Switzerland in the 1930s as the result of currency shortages after the stock market crash of 1929.

Led by Werner Zimmermann and Paul Enz, sixteen business people in Zurich created a mutual credit system used among members with a currency unit named the WIR, which is short for wirtschaftsring, of equivalent value to the Swiss Franc. They are believed to be influenced by German libertarian economist Silvio Gesel. This system works just like any other conventional credit system, but instead borrowing money from banks, this system operates within their small circle of members business-to-business. The exclusive currency is used to buy from each other, including payroll.

The beauty of this system is it bears no interest. Instead, a debit would translate with reimbursement with sales to a member’s business. It is basically the world’s economy model operated with simulation run professionally. It may sound too libertarian for some people, but in this desperate time, a workable measure is better than no measure at all.

Today, this system is still operating with annual volume of $2 billion and involves 62,000 members, which is a quarter of all Swiss companies. It has reach “organic growth” at this point, in which a recession would automatically expand the system’s operation and shrink back when economy is booming. Studies have shown that WIR has been playing an important role in the health of Switzerland’s economy.

Now let’s see whether complementary currency paradigm would be the choice.

To begin with, the primary criticism goes to capitalism’s axiom “more is better.” Aristotle, the Greek philosopher, provided solution to chaotic economy with the notion of simple living, which is probably the answer we have been looking for. “Just enough is plenty” should be adopted instead, without causing isolationism resulting from the absence of consumerism.

In Graceful Simplicity: Toward a Philosophy and Politics of Simple Living, Jerome M. Segal wrote that within the framework of politics of simple living, the belief that the heights of human development is pluralistic, is inevitable. However, a platform in which achievement can be cultivated in alignment with respect to economic level can be attained with awareness of higher capacities, not merely on consumeristic activities.

Switzerland’s WIR complementary currency gives small and medium-sized businesses the control badly needed. And Aristotle’s simply living philosophy when translated to actions provides the much-needed psychological, emotional, and political certainty that the power to change lies in the hands of all of us.

Now the question is not about “to bailout or not to bailout.” Rather, it is the question of “who will be bailing out whom.”[]

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