Daily VideoDecember 9, 2013
Local Currency Hopes to Spur Businesses in Western Massachusetts
In Berkshire County in Western Massachusetts, community businesses and citizens are exchanging a new local currency called “BerkShares” as a way to support the local economy.
BerkShares, an alternative, small-is-beautiful local currency born in 2006, is now accepted by some 400 businesses around the county.
Because of the way the currency is tied to the value of the U.S. dollar, anyone who uses BerkShares receives a five percent discount over those using U.S. dollars. Although users can buy 105 BerkShares for $100, “We take your BerkShares at the same value as U.S. dollars, and we spend them as U.S. dollars. And it stays in our community, because there’s a geographical limit to where you can redeem BerkShares,” said Brian Butterworth, director of sales at the local Red Lion Inn.
“We don’t make money off of it or lose money off of it,” he said. “BerkShares is just a way to keep money within the community.”
This means protecting local businesses from big box retailers who may come to town.
Tom Levin of Tom’s Toys, thinks that BerkShares are part of the answer to the threat of Internet retail and chain stores.
“The answer is also to create awareness among people that, if they shop online, 100 percent of what they spend goes into the same cyberspace that they’re sending their order,” he said. “If they shop at a big box store, 65 percent of what they spend leaves the community.”
Eventually, proponents of BerkShares hope that the currency will be able to hold value on its own, as opposed to the dollar, which is constantly experiencing inflation.
Warm up questions
- How does currency work? Click here for a short synopsis from “How Stuff Works”
- How do people pay for things in other countries that have a different currency than theirs?
- Do we have local currencies in the United States today? Have we ever had local currencies? (Hint: Think back to the Revolutionary War Era)
- Is the BerkShare legal? How and why? Could you create your own currency? What would that process look like?
- How does the BerkShare protect local businesses from big box retailers who may come to town?
- Overall do you think that BerkShares are a good idea? Do you think that other communities might copy their example?
- What do you think are the community’s main goals they want the BerkShare to accomplish? Are they meeting those goals? How could you tell?
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