5 ms·

Will old-fashioned scrip make a comeback?

16 points by robg 18y ago

andr 18y ago
While this sounds very interesting, it only makes sense on a regional level. On a national level, a tax on savings and deposit accounts could very well to the same at a lower cost. The logistics of doing scrips nationwide would be very complex. The article also omits the fact that the value of a scrip would change as it gets closer to its expiry date. Simply put, you wouldn't want to accept scrip that expires tomorrow as payment. This would call for some funky mathematics at the checkout counter.
- robotrout 18y ago
  Yes, "a tax on savings and deposit accounts", also known as a wealth tax, as opposed to an income tax, would, indeed, encourage spending. It's also one of the most frightening ideas I've heard proposed, and you're not the first to propose it, it's been proposed by congressmen. Just as there was a strong backlash against the patriot act, with many feeling that extra security was not worth losing rights for, so too, must you seriously examine whether you really think it's worth sacrificing your children's ability to save, to end this business cycle's downturn six months early. These times disturb me greatly, and it's not the problems that scare me, it's the solutions that are proposed to them.
  - Raphael 18y ago
    A wealth tax makes more sense. If you hold on to money longer, you are preventing someone else from spending it.
wernerv0nbraun 18y ago
the US government will never allow the US dollar to be displaced as the only paper currency, it would undermine their power over the public. even presidents cannot undermine the dollar...kennedy attempted to circulate "US Notes" instead of "Federal Reserve Notes", and he also failed. the government will respond to alternative currencies with violent force.
Hoff 18y ago
This scrip is already in circulation in some areas of the US. What are known as BerkShares http://www.berkshares.org/ http://www.berkshares.org/ are available in the Berkshire region of Massachusetts.
pragmatic 18y ago
How quickly we forget the negative savings rate in the US. If we had in fact been saving (as a nation, I myself have been saving for quite some time) then this plan might make a little more sense. As it is, the US is broke. Passing around funny money doesn't seem like a good idea, but hey, not much of what the gov't has done or is trying to do seems like a good idea.
Tichy 18y ago
I don't quite understand it: doesn't money decay usually anyway (since most of the time there is inflation)? And what does one really want? I don't think circulating money is the goal of an economy, the well-being of it's participants is the goal. I doubt a decaying currency would help with that. Money is just a tool - if somehow it does not do the job people want it to do, they will switch to alternative schemes anyway. If money decays, maybe they will trade in "stuff" instead. I don't see how artificially lowering a tools effectiveness could help, in general. It would be easy to create jobs for everyone by just outlawing all machines, so everybody would have to work on the potato farms to pick potatoes. Everybody would have a job, but overall the economy would be worse off...
- robotrout 18y ago
  It's a very interesting time we're going through. We begin to see that, even though we have long railed against the evils of inflation, there are worse things. You have to guarantee inflation>=0 for an economy to work. Gold bugs would opt for inflation=0, and that's very good. But if you don't happen to have a gold backed currency, than inflation>0 needs to be your goal, since targeting inflation=0 is too easy to screw-up and go negative. Why do you need inflation>=0? So people are willing to spend. Otherwise, they'll shut down and wait till tomorrow to buy. Tomorrow, they'll do the same thing. Nobody buys anything, and the whole thing just dies. Sure, people will trade in "stuff", as you put it, but the efficiencies of that are very low, which is why money was invented in the first place. So, in theory, it is good to somehow devalue a currency based on time. We just have to be really careful we don't hurt too many generations in the process.
  - Tichy 18y ago
    But if there is deflation, supposedly there is a reason for it? Seems to me like introducing artificial inflation is just messing with the symptoms, not removing the cause. I also don't think people wouldn't spend anymore. They need things, so they have to spend. If they don't need things, they shouldn't spend. I don't think making people buy stuff they don't need is really helpful in the long run.
ars 18y ago
Very similar to this: http://news.ycombinator.com/item?id=442059 http://news.ycombinator.com/item?id=442059
sriram_sun 18y ago
Deflation
tristian 18y ago
I don't understand how this would work. If you had a form of currency that was continuously losing value, wouldn't you simply exchange it for something equally liquid that wouldn't lose its value? Such as gold or silver?
- eru 18y ago
  Then somebody else has to get rid of that currency. That's the whole plan.

16 points by robg 18y ago

andr 18y ago

While this sounds very interesting, it only makes sense on a regional level. On a national level, a tax on savings and deposit accounts could very well to the same at a lower cost. The logistics of doing scrips nationwide would be very complex. The article also omits the fact that the value of a scrip would change as it gets closer to its expiry date. Simply put, you wouldn't want to accept scrip that expires tomorrow as payment. This would call for some funky mathematics at the checkout counter.

robotrout 18y ago
Yes, "a tax on savings and deposit accounts", also known as a wealth tax, as opposed to an income tax, would, indeed, encourage spending. It's also one of the most frightening ideas I've heard proposed, and you're not the first to propose it, it's been proposed by congressmen. Just as there was a strong backlash against the patriot act, with many feeling that extra security was not worth losing rights for, so too, must you seriously examine whether you really think it's worth sacrificing your children's ability to save, to end this business cycle's downturn six months early. These times disturb me greatly, and it's not the problems that scare me, it's the solutions that are proposed to them.
- Raphael 18y ago
  A wealth tax makes more sense. If you hold on to money longer, you are preventing someone else from spending it.

wernerv0nbraun 18y ago

the US government will never allow the US dollar to be displaced as the only paper currency, it would undermine their power over the public. even presidents cannot undermine the dollar...kennedy attempted to circulate "US Notes" instead of "Federal Reserve Notes", and he also failed. the government will respond to alternative currencies with violent force.

Hoff 18y ago

This scrip is already in circulation in some areas of the US. What are known as BerkShares http://www.berkshares.org/ http://www.berkshares.org/ are available in the Berkshire region of Massachusetts.

pragmatic 18y ago

How quickly we forget the negative savings rate in the US. If we had in fact been saving (as a nation, I myself have been saving for quite some time) then this plan might make a little more sense. As it is, the US is broke. Passing around funny money doesn't seem like a good idea, but hey, not much of what the gov't has done or is trying to do seems like a good idea.

Tichy 18y ago

I don't quite understand it: doesn't money decay usually anyway (since most of the time there is inflation)? And what does one really want? I don't think circulating money is the goal of an economy, the well-being of it's participants is the goal. I doubt a decaying currency would help with that. Money is just a tool - if somehow it does not do the job people want it to do, they will switch to alternative schemes anyway. If money decays, maybe they will trade in "stuff" instead. I don't see how artificially lowering a tools effectiveness could help, in general. It would be easy to create jobs for everyone by just outlawing all machines, so everybody would have to work on the potato farms to pick potatoes. Everybody would have a job, but overall the economy would be worse off...

robotrout 18y ago
It's a very interesting time we're going through. We begin to see that, even though we have long railed against the evils of inflation, there are worse things. You have to guarantee inflation>=0 for an economy to work. Gold bugs would opt for inflation=0, and that's very good. But if you don't happen to have a gold backed currency, than inflation>0 needs to be your goal, since targeting inflation=0 is too easy to screw-up and go negative. Why do you need inflation>=0? So people are willing to spend. Otherwise, they'll shut down and wait till tomorrow to buy. Tomorrow, they'll do the same thing. Nobody buys anything, and the whole thing just dies. Sure, people will trade in "stuff", as you put it, but the efficiencies of that are very low, which is why money was invented in the first place. So, in theory, it is good to somehow devalue a currency based on time. We just have to be really careful we don't hurt too many generations in the process.
- Tichy 18y ago
  But if there is deflation, supposedly there is a reason for it? Seems to me like introducing artificial inflation is just messing with the symptoms, not removing the cause. I also don't think people wouldn't spend anymore. They need things, so they have to spend. If they don't need things, they shouldn't spend. I don't think making people buy stuff they don't need is really helpful in the long run.

ars 18y ago

Very similar to this: http://news.ycombinator.com/item?id=442059 http://news.ycombinator.com/item?id=442059

sriram_sun 18y ago

Deflation

tristian 18y ago

I don't understand how this would work. If you had a form of currency that was continuously losing value, wouldn't you simply exchange it for something equally liquid that wouldn't lose its value? Such as gold or silver?

eru 18y ago
Then somebody else has to get rid of that currency. That's the whole plan.