Summer School for Alternative Economic and Monetary Systems

Free Money of Wörgl & Complementary Currencies Vienna, July 24th, 2015 Speaker: Heinz Hafner & Veronika Spielbichler Unterguggenberger Institute, Wörgl is a registered non-profit society, founded in 2003 for the documentation and public education on the WWII free money experiment in Wörgl as well as for contemporary research on complementary currencies nowadays.

The Unterguggenberger Institute initiated the „LA21 youth project I-MOTION“ in 2004.

The society is a founding member of the initiative „Neues Geld in Österreich 2007“ and addressed a petition onto the Austrian Parliament in 2008.

unterguggenberger.org archiv.unterguggenberger.org neuesgeld.com Money for the Freedom of Creation

• PART I ~15min impuls from the past Free Money of Wörgl („Wörgler “) an historic show case

• PART II ~15min impuls from the present complementary currencies today options & experiments (flattering & colourful)

• PART III ~60min impuls for the future an interactive approach to currency design classification sheet drafting

PART #1 – impuls from the past The monetary experiment in Wörgl – Wörgls Free Money a short outline on a historic show case

Initial situation: the historic economic situation in the region of Wörgl

The driver: Mayor Michael Unterguggenberger – his life

Prearrangements of the Free Money experiment: - foundation of the Free Economic Group of Wörgl - political decisions within the municipality

Realization: creation of a demurrage voucher, which represented the worth of labour time – monthly charge in the form of stamps that needed to be bought and sticked onto the voucher – construction programme – facilitation of consumption – fostering municipal taxes – creation of an infinite cycle

After life of the experiment: Imitations and copycats in Austria, international attention by the media Between 1900 and 1930 the small town of Wörgl Develops as an industrial and commercial center due to its convenient location mainly based on the railway infrastructure.

Wörgl 1930 The global economic crisis triggered by a stock market crash (1929) hits the town and surroundings very hard in numbers: Wörgl: 400 family sustainers unemployed (4.200 inhabits in total)

Region: 1,500 people lose their jobs. state aids only for a few weeks after that mere economic survival fight on an individual base prevailed Michael Unterguggenberger born: August 15th, 1884 - Hopfgarten born into a humble working-class family started an apprenticeship as mechanic In 1905 he became a train driver at the Austrian federal railway. In 1919 he became vice-mayor for the social democrats Mayor from 1931-1934 Michael Unterguggenberger (cont) A gifted musician head and instructor of the workers’ youth band in Wörgl in the 1920s He was active member in several associations and with his help, the local trade union grew from 100 to 800 members he was a true networker & inspirer! 1931: foundation of the Free Economic Group of Wörgl a cooperation of merchants and caterers INITIALIZATION: Political cooperation across partisan borders the fiduciaries of the Free Money project in Wörgl (starting from the left): Dr. Georg Stawa (head of the Home Guard and financial advisor of Wörgl), mayor Michael Unterguggenberger, Rudolf Winkler (secretary of the municipality), and vicar Matthias Riedelsperger The Free Money of Wörgl financed by Wörgls Free Money Infrastructure programmes: construction of new roads all over Wörgl (1932), a new bridge, additional living and storage building for the villages’ mill, even a ski jump ALL IN MIDST OF HARD ECONOMIC TIMES!

After a hard start in means of acceptance of “Arbeitswertscheine” (the coupons-based compl. currency) pay-day and daily life integrated the “money” as a normal part! More and more “players” joined … … in 1933 the neighboring village of Kirchbichl began the construction of its own open air bath based on Wörgls free money 

… Wörgls Raiffeisen-bank became a partner Michael Unterguggenberger an innovative mayor but his inventions became illegal … The idea of a municipal bond for lowering the burden of interest was the next step …

Granting of credit with 6% interest to local businessmen for buying goods elsewhere (out of the Schilling-coverage of the Free Money) The interest was used as care for the poor as it was done with any revenues, created by the issuance of Wörgls Free Money (stamp-charges, 2% conversion charge, etc.)

Even a resolution was directed onto the parliament of Austria for the legitimisation of free money as a fundamental help during economic crisis.

However, this wish was not granted.

Instead: free money was forbidden by the National Bank of Austria.

eventually Mr. Unterguggenberger called even for a “Free State of Wörgl”

BUT: HISTORY TOOK A DIFFERENT ROAD  BUT²: Media Coverage & Public Interest on “Freigeld Wörgl” never died upon AND was never higher then at present  Part #1 - lessons learned: • a working is a possibility Wörgl Freigeld: NO FICTION BUT PAST • it takes ambitious people and goals • expect a hard introduction period even when the need is already high • not “the one and only solution/invention” counts but the targeted formation and development over time shows success • even local municipal authority could not withstand the given “overmacht”

Money for the Freedom of Creation PART #2 – impuls from the present complementary currencies today real options or just flattering & colourful experiments?

. Huge variety and constantly growing … local/international, old-fashioned/digital, …

. Lots of active initiatives and even first best practice candidates

. Just to name a few occurences and aspects: regional complementary currencies, barter systems, time banks, commons-based, gift economy, basic income, democratic banks, cooperatives, energy cards, crypto currencies, education coupons, senior care systems, micro-credits, … Complementary currencies according to their purpose backed by established lead currencies – purchasing power retention • Regio‘s (“”, “Waldviertler”), „Einkaufstaler“ (merchants) • Multi-way vouchers (demurrage) vs. one-way vouchers • Basic principle: conversion against national currency backed by goods and services – self empowerment • Barter systems, local exchange trading systems (LETS) • Basic principle: mutual credit creation community based – fostering of the community • Time banks • Centralized creation of money – all user accounts are positive combined systems: • E.g. “Regiostar”, “Talente” (Allmenda Social Business e.G. in Vorarlberg) a manifesto is the mother of a new movement In 2009: Guiding principles for „Neues Geld“ in Austria (consensus papers)

• Stability of purchasing power – The user will receive an equivalent in the form of labour (time). – The circulation of money is steerable and demand-based. This can be done through de-evaluation or taxation of money (demurrage) or through an expiry date. • Democratic basis – The creation of money happens at the basis: every person can create money and there is a democratic control of the system. – Transparency for every user: the size of money supply and the rules of the system are made public, they are clearly understandable to everyone. • Fostering of the community – Promotion of solidary structures of society and economy – Involvement of everybody to the benefits of work rendered to the public (involvement of the citizens, volunteering, charity work, etc.) • Sustainability – Promotion of a resource-efficient and close-to-nature means of economy – Promotion for the creation of regional economic cycles

Today lots of „players“ within the „complementary money movement“ are actively working on common ground installation for further, stable development to get out of mere experimental phase – who, when, what will win the race „becoming the figurehead“ uncertain still - no single institution or movement-pope yet – where is our Steve Jobs of CCS  WARNINGS FOR THE UPCOMING INFO

Keep in mind and be warned:

• We are in a huge transition phase within society => all details mentioned here have very short half-life-expentancy => no “player” with “claims for truth” will hold for long – or but ?

• The landscape is highly scattered and there exists difuse situation => Keep in mind local and sectorial specifics => “ONE solution” on the one end can mean cure or poison on the other

• Power, decision making and organisational implementation (central/decentral)  Every innovative approach needs acceptance by “the stakeholders”  Every viable enablement is leading to decisions, power and structures

• Sustainability => The environmental health state of our planet is at stake => Our psychic and economical resistances are at the edge so shocks should be exptected

So ALWAYS take into decent considerations BE PREPARED, WHEN confronted with INSPIRING STUFF or PEOPLE OPEN-MINDED & AMBITIOUS especially in the field of „compl. curr. systems“: BUT ALSO CAUTIOUS! Regionally well-known and best practice candidates in the german spoken area: both in someway mixed models

Regional currency: Chiemgauer www.chiemgauer.info

cooperative: Allmenda Social Business eG www.allmenda.com most matured and settled austrian cluster: regional currencies in Vorarlberg “Allmenda Social Business e.G.” – regional currencies: • “Vtaler” – includes regional agriculture • “Langenegger Talente” (the village of Langenegg won the Austrian prize for regional innovation in 2010 with this project ) • “Walser Thaler”, “Biosphärenpark-voucher” • (the “Klostertaler” was discontinued)

These regional currencies are … • circulating faster than the Euro. • passed on up to 4 times before they are converted back to Euros. • useable for online transactions as well. • approved by the FMA, who granted full status as legal tender.

The cooperative is provider and coordinator for regional currencies throughout Austria: • in 2014 “Regiogeld Neukirchen” (Upper Austria) started source: www.allmenda.com Complementary Currencies international knowledge boxes out there

CCIA will be launching a comprehensive mulitlingual gateway “C-C.info” to all online resources and literature on complementary currencies. Aiming for global coverage and contributions in the mid and long term, the site will intially seek to cover and stay up to date on all complementary currency issues and initiatives in the North West Europe region.

EU-Interreg-project : France, United Kingdom, Belgium, Netherlands - pilot currencies: SoNantes, Makkie, Brixton Pound in Lambeth, E-Portemonnee, TradeQoin, Spice Time Credits Further information: http://communitycurrenciesinaction.eu

New Economic Foundation NEF: NEF is the UK's leading think tank promoting social, economic and environmental justice, including Community Currencies http://www.neweconomics.org

Other solidary economic activities Invest into your region: • Cooperative concept & revitalization of regions: – “RegioSTAR e.G.” – “Sterntaler e.V.” • ReWig – regional economic communities: – München, Schlehdorf, Allgäu • WIR-bank of Switzerland: – complementary currency since 1934 • JAK-model of Sweden: – interest-free financing programme for residential construction • Municipal utility company: – civic participation model – use of renewable energies – Commons/Free Gardens New forms of society & collaboration

• Solidary economics – South American Social Trade Organisation (STRO) • “Gemeinwohlökonomie” by Christian Felber, a new economic order which takes the public good for companies and municipalities into account (participatory process started in 2010) • Commons – Allmende / using instead of owning (e.g. Free Gardens) • Basic Income Youth project “I-MOTION“

Local agenda 21: youth project for the city of Wörgl since 2005 Young people receive time value cards for services they rendered in retirement homes in Wörgl. They can change these cards for services from local companies. Since 2012 this project is steered by “Komm!unity“, the society for youth, integration and common wealth movement (more information on: www.jugend.woergl.at). The “sun notes“ of Wörgl („Sonnenscheine“) are a civic participation model for creating a solar energy power plant in Wörgl. Your advantages: • The price for electrical energy is secured up to 100% within the next 20 years (for the energy consumption of an average household). • By the end of each year, you get a reduction on your energy bill by the amount of solar energy being produced during that year. • You may sell back your “sun notes” at any time without mentioning reasons. You will receive the value equal to the worth of money you Stage of expansion: would get until the end of you subscription. • Solar parc 1 • Solar parc 2 Cost = € 900,00 (incl. VAT) for each “sun note“ • Solar parc 3

(This compares to a powerplant capacity of 0,5 kWp or a (fully financed by “sun notes“) generation of approx. 450 kWh of solar energy within an photo by Stadtwerke Wörgl GmbH average year of sunshine.) Commons project on permaculture: the Free Garden of Wörgl, voluntary gardeners on property of the city since 2011. The „energy.card“ of Wörgl

In the beginning of 2013, this multifunctional card has been sent to 12.000 households in Wörgl. The energy.card includes a rebate collection system where its users get money back with every transaction in many shops in and around Wörgl. This money is stored on the card and can then be used to pay for goods, services, leisure activities and sports events but it can also be given to charity or other members of the system. The card can also be used to enter and pay for municipal facilities (like the water parc „Wave“ or the recycling depot). (photo: www.energiemetropole.at) Part #2 - lessons learned: • ambitious people and goals exist out there and are well set up

• Massive, volatile and difuse landscape of active complementary currencies mostly mingled with other first and secondary goals/drivers

• time will bring clearer view and track records soon: Life cycle of the complementary currency movement has already changed from introduction to growth and is rapidly moving towards maturity stage as typical KPIs derived from “product life cycle”-Management indicate

Money for the Freedom of Creation PART #3 – impuls for the future an interactive approach to currency design show casing dynamics based on classification sheet drafting

. WHY? . WHAT? . HOW? . WHO?

. A BASELINE CLASSIFICATION ON CURRENCIES a mere draft and empirical base work not more / not less

What are the inner attributes of such systems? Currency classification – 3 diverse examples / 3 different „worlds“

currency classification

currency USD bitcoin Wörgler Freigeld occurences banking account; e-card;bills; banking account; coins;certificate;… local storage;app certificate backing full faith & credit of the US Gov none Ö Schilling 1:1 spread (geo) international international regional 10km spread (sect) full full full target group(s) full international full international full regional 10km intrinsic value 0 0 0 creation + private banking (~ *10) decentral, anybody, by design central authority (local gov); only limited by central policy limited to approx. 21 million limited by local gov Ö Sch Supply purpose/reasoning promotion of local world lead currency ease of transaction economic development acceptance full low, rising, uncertain high penetration 1 0,1% ~ one digit % institution FED none local gov volume ~18.000 billions 13 million ? life cycle saturation growth end-of-life exchange rate floating floating 1:1 minus 2% exchange fee interest rate 0 - 20% (FED rate) no market no market info redistribution not built in not built in 2% concentration very high, top 100 ~20% very high, top 100 ~20% logarithmic logarithmic very low transferability 90 100 20 fungibility 100 30 98

Bound to the following attribution: CC licencing: You must give appropriate credit, provide a link to the license, and indicate if changes were made. You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use. Licensor: Unterguggenberger Institut, Wörgl – Heinz J. Hafner Part #3 – lessons learned: • What comes next? (my personal expectations here)

+ Further and urgent need for CCS implementations + Transition to Maturity-Stage due to upcoming full-life-cycle-experiences of CCS imps in the near future

the main indicators will be: scientification (eg. sims, models, classifications) and further manifestations of QM-circles and consulting pros

• CCS implementations are a process, based on complex systemic rules - not fully understood yet by the active parties out there:

“Works or works not as targeted and designed” This is the message here 

PERSONAL CREDO / CALL FOR ACTION

Heinz J. Hafner pioneering & social entrepreneurship

“Go for CCS on a decent approach” (science-based + operational)

Dig into it deep take deep breath and dive for the next 2-5 years …

Eventually you become a real hero for this and the next generation of people - by solving some heavy duties of our society based on one of the most powerful and abstract instruments on earth: currency design

I‘d love to be weak-linked with you via LinkedIn or heavy-linked via your active ambassadorship @ ɱag.net (Google-Search: Magnet Magazin) ɱag.net ambassadorship is by invitation only but feel free to contact me [[email protected]] and be invited 