While Investment Dollars Remain Scarce, Mon Valley Communities Test A New Form Of Currency
Sitting in a grassy lot along Braddock’s main avenue, Jona Reyes dreams of restoring the energy that she says once coursed through the neighborhood. Since steel’s decline more than 30 years ago, the Mon Valley community has suffered from chronic disinvestment.
“When you look at what changed, it was the community aspect of it. It’s like, let’s get back to relying on one another and building up ourselves,” Reyes says as traffic rolls through Braddock’s commercial district, a sparse collection of businesses scattered among empty storefronts and vacant lots.
Reyes is the director of Neighbors Helping Neighbors, a grassroots group that links volunteers with people who need services such as a car ride or home repair. The goal, Reyes says, is to establish an “alternative economy.”
“Our needs can be met, especially in low-income communities … if we lean on one another and look out for one another,” Reyes says.
Reyes’ group got a boost earlier this year from an organization called involveMINT. About five years ago, involveMINT developed a digital currency, called “time credits,” to share with people who invest their time in the community. The East Liberty-based venture initially focused its efforts in Pittsburgh’s Hazelwood neighborhood. But by working with Neighbors Helping Neighbors, the group hopes to begin circulating time credits in and around Braddock.
So far, involveMINT and Neighbors Helping Neighbors have enlisted about 10 local businesses to accept the credits as payment. While the units are considered taxable earnings, they reflect a deeper contribution to the community, said involveMINT executive director Dan Little.
“Money is scarce in the communities that arguably would need it most,” Little noted of the lack of funding in places like Braddock. “So the idea is [that] by having an alternative currency, you’re creating an alternative channel for commerce to happen, when that money is not available.”
Communities throughout the world have established local currencies with varying levels of success. The idea grew especially popular during the Great Depression, when market failures dried up the supply of cash in circulation. Propronents say alternative currencies help to stimulate local economies by encouraging firms and residents to do business with others who participate in their community's homegrown currency system.
Little added that COVID-19, and the economic turmoil it has caused, further underscore the value of reducing communities’ reliance on dollars.
Although the federal government has distributed coronavirus stimulus payments to qualifying households, Little noted, “for many people, that barely covers rent … And with local businesses, we know that they have seen a tremendous decrease in revenue.”
By using time credits created, or minted, by involveMINT, Little said, businesses can establish a new source of revenue, and use those funds to buy more supplies locally. Little noted that the coronavirus pandemic has revealed the fragility of global supply chains.
“[The new currency] may not be a panacea. It’s not going to pay for everything. But it’s going to get [users] some access to things that are local,” Little said.
‘It will help to unify the community’
COVID-19 prompted Neighbors Helping Neighbors and involveMINT to launch a grocery delivery service as one option for earning time credits. The program aims to help those who are vulnerable to the disease and, thus, should avoid stores.
Retiree Cynthia Underwood is one of several community members who have signed up to make deliveries. Her clients include seniors such as Myrtle Walker, who’s physically unable to go down stairs. In fact, when Underwood makes a delivery, the 72-year-old drops a key from her second-floor apartment window so that Underwood can let herself in.
Walker, who also suffers from lung disease, has not gone shopping since COVID-19 broke out in the U.S.
“I haven’t been in a store, I don’t think, for about maybe three, four months … So, I count on her,” Walker said of Underwood.
Underwood earns 15 time credits for every hour she spends making deliveries. Each unit is supposed to be worth a dollar. But for Underwood, a native of Rankin, the most important benefit is the possibility that participants will invest in each other.
“I think it will help to unify the community a little more and have people have a more vested interest in each other,” Underwood said.
Urban agriculture nonprofit Grow Pittsburgh found similar reasons to accept time credits at its produce stand in Braddock for similar reasons. Grow Pittsburgh’s director of farm education, Denele Hughson, said time credits are rooted in the same philosophy as her organization, which strives to empower communities like Braddock to draw on existing assets to cultivate their own food economies.
Hughson noted that her organization can use the time credits to buy compost from the local company Worm Return. And she said Grow Pittsburgh will use the units to pay for a few additional hours of work at its urban farm.
“Someone who’s just looking to volunteer for a few hours a week, and in exchange for that they actually get something tangible that they can use it on – I think that would be amazing,” Hughson said.
The success of any currency, including the dollar, depends on whether people trust it. And whether they trust it depends on how much they see others use it.
Circulation has been a challenge for local currencies elsewhere. In Ithaca, N.Y., for example, a currency called Ithaca HOURS went defunct after about two decades. Erik Lehmann was the last person to chair the Ithaca HOURS board.
“Towards the end, it was basically like a coupon,” he said of the HOURS. “It wasn’t a full currency. Most vendors that accepted it didn’t accept it at full face value.”
Lehmann said there were not enough ways in Ithaca to redeem the alternative currency. While at one time about 300 businesses had signed up to accept the HOURS, Lehamann said, “There weren’t the Wegman’s and the big banks and the big landlords."
In Philadelphia, a local currency called Equal Dollars faced a similar hurdle, though it too had been in circulation for about 20 years. Former Equal Dollars director Deneene Brockington said, because most businesses had nowhere to spend Equal Dollars, they simply donated them to charities of their choosing.
“That kind of resonated with some people and some local businesses: They got to participate in something local and then donate to a community organization that then was able to use those dollars as a way to thank their people for community service,” Brockington said.
Equal Dollars ultimately dissolved in 2014 because, Brockington said, the nonprofit that ran it, Resources for Human Development, decided to stop funding the program. Brockington noted that staffers like her, who managed the Equal Dollars program, still needed to be paid in U.S. dollars. After all, they couldn't use alternative currency to pay their bills.
Scott Morris, who is leading an effort to launch a new currency in Ithaca, called Ithacash, has also struggled to secure funding for personnel. He said it's a necessary expense, to ensure that professionals can educate people and businesses on how to use the units, recruit more participants into the network, and manage the complexities associated with sustaining that network.
"The business model has never been easy to deal with because it’s like, ‘Look, we’re making our own money, and so you should pay us some regular money for it.’ And [potential funders] are just going to be like, ‘Well, this is the real money. Why do you want my real money for your funny money?’” Morris said.
But Morris noted that mainstream investors have grown increasingly conscious of the social and environmental impacts of their contributions investments, and that COVID-19 has shaken people’s confidence in traditional markets.
“Now, I think we’re at the point … where we can make a very solid business case for why these [local currency models] are worth paying regular money for,” he said.
In Pittsburgh, involveMINT’s Dan Little said his bottom line is whether the communities that use his organization's time credits gain the resources they need to invest in themselves.
Considering the market hasn't addressed this need, Little said, the credits' fate is “almost in some ways about survival. It’s like … let’s see what the community can do to help itself.”