The Anti-Capitalism Reader by Schalit Joel;

Author:Schalit, Joel;
Language: eng
Format: epub
Tags: ebook, book
Publisher: Akashic Books
Published: 2014-03-24T16:00:00+00:00

How Parallel Economies Are Working Against Global Capitalism

Megan Shaw Prelinger

As 2001 drew to a close, the promise of global economic integration became clear. With networks of capital linked worldwide across increasingly porous borders, the downturn of the United States’ economy was pulling the world down with it. The global supply funnel that pours First World “development” capital into countries such as Taiwan, Mexico, Singapore, and Argentina has left those countries in deep recession as the U.S. economy retracts. At the same time, those countries that have lagged behind globalization are suffering less.

The phenomenon of globalization has created a new economic geography as capital accumulates in new patterns of centralization that no longer fit state-based economic patterns. While most accounts of anti-globalization initiatives tend to focus on anti-capitalist protests and debt-relief movements, little focus has been placed on an entirely different set of responses to globalization that emphasize the creation of alternative modes of commerce. Around the world, new mechanisms of exchange are being developed such as trade and barter associations, mutual credit associations, and local currencies. These exchange mechanisms are redefining how wealth is created and distributed in small-scale economies. This essay will examine how capital is being reconceived at the local level worldwide, and how local economies are operating in parallel to the global economy.

Parallel currencies and community-level economies are not new. Historically, people have used a wide assortment of value units and trade groups as media of exchange. In the United States, local currencies flourished in colonial times and currencies were backed by a variety of goods such as corn and timber. Independent coinage was not outlawed until 1864, and the centralized banking system was not established until 1913. Even after the national currency was federalized, it was rarely the only operating currency in the country. Local scrip was used widely during the 1930s to allow goods to be traded in the face of extremely scarce federal currency. And in the early 1970s an experiment by the decentralist Ralph Borsodi established a new currency called the Constant in Massachusetts that was designed to operate independent of the raging inflation of that era. That experiment didn’t last, but it started a new era of interest in local currency and other decentralist strategies that gathered momentum throughout the 1970s and ’80s. Then globalization raised the stakes.

The passage of NAFTA in 1993, the Uruguay round of GATT in 1994, and the creation of the WTO in 1995 together redrew the flow of capital worldwide. The dismantling of the Soviet Union has allowed capitalism to attain a level of global hegemony that was unimagined before 1990. At the same time, the high-speed computer networks that became ubiquitous in the mid-1990s facilitated the development of what has been termed the “casino economy.” As a result of this new economic geography of the 1990s, parallel economies have taken on heightened significance. They have become important experiments in defying global capitalism by creating working economic alternatives that have direct impact on people’s livelihoods.

What Are Parallel Economies?

In Ithaca, New York, a local currency called Ithaca HOURS is circulating widely.

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