About the Report:
There have been a number of writers who have accurately identified the fundamental flaws within the current hegemonic financial and ownership system that support, and drive, unsustainable development. Their proposals, such as alternative currencies and non-debt money, provide clear ways in which a society’s monetary and financial processes could be designed for both sustainability and greater equality of control and wealth. These proposals tend to fall into two main areas (i) macro-level changes to the current privatized debt-based monetary system, and the subsidies provided to that system and financial markets in general; (ii) the generation of a mixed financial eco-system through diversity of ownership models, such as cooperatives and publicly-owned banks, and local currencies.
The most significant issue with such proposals is not the accuracy of the underlying analysis, nor the efficacy of the proposed changes, but the obstacles to their implementation within the currently constructed human societies. As the climate scientists have discovered over the past decades, presenting accurate analyses and resulting proposed measures does not automatically lead society to take such actions, even when such lack of action risks the destruction of modern industrial society. The proposals of the climate scientists both threatened large economic interests, such as the fossil-fuel extraction industries, and challenged hegemonic ideals such as the efficacy of continual economic growth. The proposals also lacked a viable social movement, and supporting institutional infrastructure, to drive their implementation within society. When looking at proposed changes to the financial system any analysis must be realistic about the oppositional forces, the tactics and strategies utilized by those forces, and the supporting forces available. As Graeber has noted the current financial system is “the first effective planetary administrative system, operating through the IMF, World Bank, corporations and other financial institutions, largely in order to protect the interests of creditors”, without significant offsetting protection for debtors. Such a system will act to protect its interests against threatening changes, as was shown by the termination of many previous alternative paths identified by Lietaer, and Lewis & Conaty, as those paths threatened to grow from merely local enterprises to regional and national ones.
This paper looks at some of the historical successes of alternative financial and ownership arrangements to identify both reasons for success, and reasons for the limitations of those alternatives. It will also identify possible obstacles to change through a review of some historical failures. For example, why did the WIR (the Swiss Wirtschaftsring-Genossenschft complementary currency) manage to survive and thrive in Switzerland, in the face of many challenges, while many other parallel initiatives were forcibly terminated? A general analysis of how the powerful within modern industrial society use techniques of control and co-option is also utilized to help identify obstacles to change, and also to identify when seeming successes may have been successfully limited or co-opted. Such insights are crucial to an understanding of how to move initiatives from the local to the meso/macro level, and from operating within the current paradigm to changing that paradigm. There are also questions of socio-cultural and historical specificity which need to be addressed, as some alternative approaches may not be transferable in time or geography.