What Is local currency?
Local currency is a system of trade where paper notes (scrip) are used for formal and informal commerce within a specific geographic region. Our local currency is called VolHours.
Imagine, money just for the Tennessee! Local currencies are supported by real labor, real goods and real services in our own community. One VolHour (1VH) is equal to ten federal reserve notes ($10). VolHours acknowledge the value of local labor and goods and highlight the time and effort invested by the seller. It’s suggests that no one be paid less than 1VH for an hour of work.
VolHours are not meant to replace federal dollars. Instead, they supplement dollars, making more money available in circulation. Currently, there is FAR less money in circulation than debt owed. This is the cause of widespread foreclosures, bankruptcies, and loss of national sovereignty.
Buy Local, and then some … Using VolHours is taking the idea of buying local one step further. When you use VolHours, you trade with money that will not leave Tennessee. Money that stays in the Tennessee circulates over and over again instead of leaking out to distant corporations and financial institutions. If 1VH changes hands 100 times, that’s an equivalent to $1000 in trade right here in our community, with zero leakage.
Why use a local currency?
- Local currencies can only be spent on goods and services locally, so the purchasing power stays within the community and boosts the local economy.
- Local currencies create opportunities for people who have skills to trade but are not employed in the current job market.
- Local currencies create opportunities for people to earn income doing the things they really enjoy. For example, a person may love making quilts, but find it difficult to earn money from that hobby in the regular job market. Local currencies create new avenues for earning more income from this type of skill.
- Local currencies bring publicity and tourism to the regions using them, and thereby, more federal money. Using VolHours organic money is fun for locals AND tourists.
- Because local currencies cannot be hoarded in a savings account, they always encourage local spending of both federal dollars and the local currency.
- Local currencies build and strengthen community relationships and self-reliance.
Susan Witt of the E.F. Schumacher Society explains that by favoring regionally-based economies, local currencies are a tool for bringing a human face and sense of place back into our economic transactions. She goes on to say that this interweaving helps bring the community together in all its mutuality – ecological, economic, social, and cultural. Local currencies are a practical way to act locally in the face of globalization.
During the Great Depression there were thousands of local, organic currency systems created because the national money was in short supply. That has occurred again today as there are record foreclosures, and bankruptcies in the US, and internationally. While Wall St may be getting bailed out, Main St. is struggling with a shortage of currency. If currency does not flow, then the local economy is sluggish, and stops.
Today there are dozens of organic money systems in the US which are entirely legal. For example Durango, CO has Durango Dollars which is issued by the local chamber of commerce. Different towns have different systems as to how the value of the money is calculated. Taxes are to be paid on all transactions which would occur with national money. An Hour is equal to $10. VolHours has four denominations:
1/10Hr=$1 1/2Hr=$5 1Hr=$10 2Hr=$20
VolHours is denominated in time as this is a universally known measure. “Time is Money” and it is backed up by our labor. Unskilled labor typically will make about 1mtnHour for an hour worked. Semi-skilled, and highly skilled will earn as much as two parties agree on just as they do now. Obviously, a doctor or any brick and mortar business will have much more training, and overhead to cover.
Before money existed societies bartered their time, services, and products. The People could get what they needed by trading. Money was invented to make these transactions much easier. View VolHours as barter receipts. Imagine we have 20 local businesses which all agree to accept Hours as money. Each business would be given $200 equivalent in Hours. $4000 in Hours was equally distributed among each business in the co-operative without cost.
Now, the currency begins to flow and as each local business accepts Hours. People get what they need without the national currency(Federal Reserve Notes). After all, the Fed is just a private company just like Federal Express. We have just as much a right to create money as the Federal Reserve. Of course we will need FRN’s for products which originate outside the county, and to pay bank debts, and most utilities. However, over time mtnHours will become more widely accepted. mtnHours is a complimentary currency which helps the overall system function with more fluidity.
For example, in Ithaca, NY the local credit union borrowed $30k equivalent from the currency co-operative. That’s right. The bank borrowed money from the People without interest for a building expansion. The contractors who bid on the work were required to accept Hours for a portion of there work. Not a problem for the contractors as Hours are accepted all over town. Ithaca, NY has been doing this for 20 years, and VolsHours is modeled after their very successful system. For more information on the Ithaca, NY hours system go to ithacaHours.com.
What are the benefits of organic money?
1. Main St. needs more money. Many people don’t have enough to pay their bills.
2. Hour money listens as it is issued by the people for their benefit.
3. Hour money stays in TN and does not take wealth away from us.
4. Hour money is debt, and interest free so it is sustainable and not subject to compounding debt which causes scarcity, foreclosure, and bankruptcy.
5. Hour money fails at the multi-national Big Box stores by design. By using our money, we practice stewardship of our community, our independence, and our neighbors. TN is one of the most beautiful places on the planet with unique history, character, and charm. Hour money is a staunch line of defense to keep it that way.
Who can benefit from VolHours?
- Local merchants, who will attract more customers by accepting VolHours
- Full-time employees who want a second job
- Part-time employees
- Under-employed workers who seek income from their skills
- The unemployed
- The housebound
- Children and teens with skills to offer
- Entrepreneurs developing a part or full-time business doing something they enjoy
- Business people who want more customers
- Those who need to pay informal debts faster
- Anyone trying to save federal dollars for travel or other goals
How do I get VolHours?
The most common way to acquire VolHours is to become a goods or service provider, and advertise. When you agree to accept VolHours in your business, we issue you 20 VolHours/3 months that you can immediately start spending into the community. The amount to be issued occasionally changes to balance with the amount of currency in circulation with relation to the goods and services offered. Typically, 20 VolHours($200) are issued for local businesses which agree to accept Hours in return. Each local independent business that signs up will get 20 VolHours for each 3 months that they remain a member. The more local businesses that except Hours, the more valuable the money becomes. Additionally, currency must flow. The more places it flows, the stronger our economic circuit becomes.
Other ways to acquire VolHours:
- Ask for VolHours as change when shopping at stores that accept them
- Exchange your federal dollars for VolHours from an trader who has an excess supply
- Accept them in payment for your labor or goods.
- Ask your employer to consider accepting VolHours by agreeing to accept VolHours as a percentage of your regular pay.
- VolHours will also be issued into the community when purchasing goods and services for business purposes and through traders choosing to advertise in the trade directory.
Are VolHours legal?
Absolutely. Similar currency systems thrive in dozens of communities around the United States. Law professor Lewis Solomon states in his book, Rethinking Our Centralized Monetary System, that there is no legal prohibition to creating a local currency system in the United States. The IRS, FBI, US Secret Service, Federal Reserve and Treasury Department have all declared the printing and use of local currencies to be legal.
Criteria for legal local currency design
- Must correspond to a specific dollar amount.
- Must not look like federal dollars to avoid confusion.
How are VolHours taxed?
Treat your VolHours like federal cash. Each VolHour denomination is assigned a specific conversion value. Since the federal government considers supplemental currencies to be a cash equivalent, you must pay taxes on VolHours income just as you would for other income.
One VolHour is equal to ten Federal Reserve Notes. It is unnecessary to file any special IRS forms for your local currency activity. When you receive a VolHour, ask yourself, “If this were a $10 bill, would I report it as taxable income and pay tax on it?” If the answer is “yes,” then add $10 to your business income and pay tax on it.
How do I handle accounting for VolHours?
VolHours are handled the same as Federal Reserve cash. Since the government views local currencies as a cash equivalent, no special accounting procedure is needed. However, because VolHours are not yet accepted for deposit at any area banks, you will need to total them separately from your federal currency.
What gives VolHours value?
Just like all forms of money, VolHours have the same source of value as U.S. dollars ~ the faith and support of the people who use them. Our local currency is designed to value a person’s time and is backed by the goods and services of your neighbors who trade in VolHours. Barter existed long before money. People traded their time, energy, and products without banks, or money. Money is a technology which just made barter easier. View VolHours as barter receipts.
VolHours have a much smaller geographic and economic base than federal dollars, but the principle is the same. The more people there are who see them as useful, the more useful they will be.
Where does the idea for VolHours come from?
The first Hours-based currency system was created in 1991 in Ithaca, New York. The Ithaca Hours system now has over 2000 individual and 300 business participants. There is the equivalent of about $70,000 in circulation, and about $2 million in transactions had been generated as of 2004. Ithaca Hours serves as a model for VolHours and dozens of similar local currencies established over the last decades around the United States.
What other local currency systems are in use today?
There are currently local currency systems in use in Canada, Austria, Mexico, Australia, The United Kingdom, and all of the United States of America. Some local currency systems in use today in the United States include:
- Ithaca Hours, Ithaca, New York
- Madison Hours, Madison, WI
- Cascadia Hour Exchange, Portland, OR
- River Hours, Columbia River Gorge, OR/WA
- Mountain Hours, Summit County, CO
In Ithaca New York, people can even pay their mortgage fees with local currency at Alternatives Federal Credit Union!
The E.F. Schumacher Society maintains a Directory of other local currencies throughout North America.
What about inflation or deflation?
There are many factors which determine how much money is put into circulation. Just as with federal currency, if too much money is in circulation, we will experience inflation. If there is too little money in circulation, the trading of goods and services will be stifled.
How do we start? What backs the money?
VolHours is BETTER than barter!
VolHours RAISE prosperity ABOVE supply of scarce FRN’s
VolHours local currency will flow QUICKLY through Tennessee’s economic circuit!
VolHours: Paper turned into money by Tennessee local business owners!! The People are the money!!