LETS TRADING SYSTEM

(Click on the title to go to the sustainable.ie site)

A few years ago we lived just outside Westport in County Mayo. We got involved with a large group of people that were in a trading system that goes by the name of LETS (Local Exchange Trading Schemes) These trading systems work mainly by bartering and the modern system came about in the 1930’s economic depression in Canada. Even though people had no work or money, they could still have goods and services from other people. A separate currency from the one usually in circulation is used; in Mayo we used the “Reek”, after the name for Croagh Patrick. The Reek was the equivalent of a Punt at the time. There are other currencies around Irelands twenty or so LETS groups that are in operation. Some of the other names for the currencies are Sods, Acorns, Skills and Cuids.

HOW DOES IT WORK?

An example of how the system works is this: If I needed to have my house painted I would pay someone a certain amount of reeks an hour to do it. In return I could tend someone’s garden and charge an hourly rate all without any “real” money changing hands. The different jobs command varying amounts of payment and the totals are recorded by means of cheques written out to people. If we had any Reeks in surplus by the end of the year we held auctions where products could be bought such as cars, caravans, tools and services. There was a weekly market stall in the town where fresh produce and plants were sold as well as books, home baking, jewellery and other small items. The system isn’t linked to the normal currency of the country so it didn’t matter what the economy was doing. If there were people with any skills from building to baking, and from dog walking to making curtains, then the community thrived. In Westport people had houses built by this method and there was even a doctor on call, as well as other highly skilled people. The system also has great potential as a social function and also the ability to offer and receive services without having to worry about money.

BANKS DON’T LIKE THE LETS SYSTEM

A Canadian called Michael Linton coined the phrase for the modern LETS method of trading but it probably goes back centuries. There has been a group set up in Inishowen a few years ago but to my knowledge it hasn’t been working for a while now. I think the reason for this is because we live in a rural area where this sort of trading has been a way of life without the formalities of inventing a separate currency; people do favours for one another anyway. In areas that haven’t got this infrastructure the LETS system proves to be very effective. So effective in fact that in Germany and Canada they were so successful in alleviating poverty and cutting unemployment that eventually the banks and politicians managed to get the trading law changed against using LETS (people don’t need to get loans out and they don’t pay tax to the government! In fact it works better if people are in debt as they are more motivated to trade!) Even now it is very difficult to operate a non-commercial community exchange system like LETS in some parts of these countries. There is a very informative web site from the sustainable Ireland group (www.sustainable.ie) that goes into greater detail on the subject and history if you are interested.

Environmental.