A Magazine About Food, Art & Exchange In Midtown Kingston, Published By The Hudson Valley Current.

Currency Corner: Community Currencies and Universal Basic Income Initiatives

The focus of this issue is alerting readers to current activities regarding Universal Basic Income Initiatives (UBIs) and growing interest in including Community Currencies, like our Current, in these initiatives.

UBIs, in their purest form, provide every adult with a regular government paid fixed income. The basic income payment does not require that a person be unemployed or have an income-means test; it is automatic.

UBIs gained interest during the presidential campaign with then candidate Andrew Yang calling for a $1,000 monthly payment to every American citizen, financed by a new sales tax, which was thought to be progressive. Over 30 mayors across the country are now calling for UBIs in their cities, to combat growing inequality exacerbated by the pandemic and to buffer job losses due to the rise of automation in the workplace.

UBI pilots vary in size and dollar amount as well as focus, sometimes moving off the notion of “universal”, to serve as a targeted response to individuals with more financial needs. In addition to promoting social and economic justice, adherents point to mental health and well-being benefits afforded to individuals and families that would feel more financially secure by receiving a UBI. Many believe that UBIs will allow people to pursue work that they are passionate about, contributing more to their communities and society. UBIs also have their detractors with some arguing that spending of UBIs does not necessarily strengthen local communities because money can be spent outside of communities, do not provide capital for struggling businesses, or result in job creation.

With an eye towards targeting impacts, or reducing the cost of a UBI, some jurisdictions are experimenting with combining UBIs with complementary currencies; with a few piloting the use of complementary currencies as the source of some or all of the guaranteed income provided to citizens. Five revolutionary pilots are testing this latter approach outside of the US. Evaluations of a number of these pilots are ongoing.

While there are many interesting questions worth exploring in studying these pilots, I am keen to learn if the safety net of UBI provision (with or without use of community currencies) expands the acceptance and use of a community currency. I often hear from community currency users around the country that currency usage can be limiting for folks with low incomes because of the challenges in currency being accepted for core expenses such as rent, utilities, and taxes. For low-income families, finding money to meet these basic needs is the highest priority.

What would be the impact on community currency uptake and impact if folks had access to a robust UBI, which covered more of these expenses? What if UBI in dollars included supplemental payments in the community currency? Would this stimulate wider acceptance of the local currency? Would providers of basic goods and services be more likely to accept the local currency? Would UBI recipients feel more secure in taking risks to start a local social enterprise and sell their goods in exchange for the currency that capitalized their business? Would these businesses prosper if a community had currency to spend that could only be spent locally—with them?