RESEARCH CENTRE FOR MONETARY AND FINANCIAL FREEDOM
   7 Oxley St., Berrima, NSW 2577, Australia
  c/o Secretary : John Zube, tel. (048) 771 436

   An OPEN LETTER ON  "L E T S", by John Zube, 16 March 1993, 
   ==========================================================
to Michael Linton and his supporters, on the occasion of Michael
Linton's visit to and talk at Bowral Memorial Hall.

Alas, only a week ago, through an meeting notice in a Bowral
bookshop, did I finally hear for the first time that a local LETS
existed, already since 1989 and then, by a phone call, that
seminars were to follow this meeting in the Blue Mountains and
that the local LETS had gained so far ca. 100 members and that by
now over 130 LETSYSTEMS exist in Australia.
I can imagine Michael Linton and his supporters as being rather
proud of and busy with them, too busy in most cases to discuss
with me the position of LETS within a general movement towards
monetary freedom as opposed to monetary despotism or to read
study and discuss other monetary freedom writings and proposals.
However, there might be a few who are interested in theoretical
and practical, legal and illegal monetary freedom options,
including generalized clearing systems, which would amount to
large scale monetary reforms or even revolutions and that could
fully cope with depressions, mass unemployment and inflations,
not only gradually, over many years, but very rapidly.
My PEACE PLANS series, published since 1964, and since 1978
exclusively on microfiche, under the label of LIBERTARIAN
MICROFICHE PUBLISHING, has by now reached 1,066 issues. It has
gathered and published, among other items, more monetary freedom
writings than anyone else has ever published before. Its listing
of such titles comes to over 55 pages, and the beginnings of its
bibliography of such writings comes to over 124 pages. An
alphabetized handbook on monetary freedom options is in the
works. Some LETS writings and leaflets are reproduced in my
series in issues 564, 740, 741, 787 & 1,000. I enclose a flyer of
ca. 1980, which lists some of the early monetary freedom writings
in my series.

While I am delighted that LETS experiments do take place, even
locally, I am not satisfied with their scope and growth potential
as long as they are confined or legally have to confine
themselves to the exchanges of some private household goods and
services and do not penetrate into the major exchange channels of
the economy : the general labour market, businesses, factories,
shopping centres, inter-state and international trading.
On the basis of doing rather something than nothing at all, it is
acceptable, if only its present limitations are seen and full
monetary freedom options are kept in mind and striven towards in
this and other ways. 

Monetary freedom would mean the realization of certain basic
monetary rights : the right to issue private notes subject to
free market rating and voluntary acceptance, the right to clear
one's debts against one's ready for sale assets and service
potential, the right to choose a standard of value for one's
contracts, the right to associate with others to form note issue
and clearing centres, the right to refuse to accept at par or
altogether the notes and certificicates and standards of others,
when one has not contractually obliged oneself to accept them,
the right to pay taxes, rates and dues in one's own notes or
clearing certificates - at their market value.
That would mean, among other things denationalizing or
privatizing money, clearing and credit, i.e. doing away with the
legal tender privilege and the other monopoly and licensing and
directive powers of the Reserve Bank of Australia and doing away
even with the constitutional, legal and juridical powers of the
government in this sphere, which have been systematically abused
for all too long. Monetary, clearing and currency functions would
practised, instead, by free private or cooperative enterprises,
many decentralized and some centralized ones, peacefully and
honestly competing and cooperating with and supplementing each
other with their note issues and clearing services. Volunteers
and among themselves could retain or re-establish whatever
central banking functions they still believed in and wanted for
themselves. But they would no longer possess despotic powers over
dissenters.
These private or cooperative enterprises and their issues,
accounts and credits would be kept in check by competition and
publicity in the widest sense, e.g. by voluntary membership,
refusals to accept them, their mutual clearing returns, free
market rating of their accounts, notes against their own and
other value standards, by competition between different and
freely chosen value standards and the pricing of goods and
services and labour in them, and by full publicity ( including
open books ) for their market rates and the details of their
issues and of the cover and reflux arrangements for them. As much
as possible and desirable of such information could and should be
expressed on private coins and notes themselves. Naturally, each
issuer of tokens, coins, notes and accounts would have to accept
the own issues at any time at par, no matter how much discount
they might have suffered in general circulation.
Such a monetary freedom system could currently be more freely
played in just a game rather than in practice. Such a game could
develop the knowledge and skills required from the participants,
who have still to become monetarily emancipated, after having
spent so long in a monetary kindergarden with compulsory
attendance. This nursery is conducted by a government which at
least in this respect is not benevolent and provided disservices
rather than services. Nevertheless, sound and honest alternatives
being outlawed, and any money being better than no money at all,
in a society dependent upon monetary exchanges, we have still to
use the monopoly and forced currency of them government for our
monetary transactions, until we can finally free ourselves from
these chains, too.
At least ever since Frederic Bastiat coined his famous phrase :
"Society is exchange", we should have doubted and questioned the
role of government in this sphere.

LETS members definitely believe in self-help attempts. The
question is only whether they are or are willing to go far enough
in this direction. The fact that they accepted government
handouts to finance the jobs or permanent coordinators, makes me
doubt that. And the fact that governments were willing to support
them makes me doubt that governments see in LETS a serious
challenge to their monetary monopolies and powers.
The rightful core of all private and competitive clearing
attempts is the essential function of all monetary exchanges,
whether carried out by tokens, coins, notes, clearing house
certificates, account books, credit cards or electronic signals
and screened accounts only. Via free and competitive clearing all
sales of wanted goods, services and labour could be achieved in a
free market and a free market would send sufficient signals,
through its free pricing and publicity, so that as a rule only
wanted goods, services and labour would be offered, at market
prices. Free clearing does not need any government assistance or
guidance. Government would merely have to get out of the way and
so far it has not been willing to do so.
Under fully free clearing, facilitated by private and competitive
note and coin issues, at least for all minor transactions, like
buying your newspaper, there would be no involuntary mass
unemployment or sales difficulties for useful and wanted labour,
services and goods that are wanted by some at market prices. All
debts and credits would balance each other and could be cleared.
The closer any system would come to this generalized free
clearing ideal, the more liberating and valuable it becomes. The
more it is kept back from this ideal, the less it will enlighten,
emancipate and serve.

Like any other experiment, LETS, in its present forms, has its
limits, conceptual and customary ones, and, unnaturally, legal
ones. These limitations ought to be explored and resisted. As it
is conceived and run now, we should not expect an end to
depressions and involuntary mass unemployment and inflations from
it.
At at time when there are over a million unemployed in Australia
even constitutional and legal prohibitions could be safely
ignored in self-help attempts by these unemployed, their family
members and friends and sympathizers, if they bothered to fully
inform themselves of their monetary freedom options and used them
systematically, well informed and very rapidly, shortly before
the next election, supplying themselves with labour and sales,
within a few days, in some cases within hours ( monetary freedom
does have that potential ), taking themselves thus of the rolls
of unemployed and of social services and of other subsidy
benefits and becoming taxpayers again. Would any politician then
dare to enforce legal prohibitions against their self-help
provision of full employment and normal and booming sales, render
them unemployed and bankrupt and punish them for their self-help
measures? Could any politician gain votes thereby or would he
have, rather, a full rebellion on hand then, in which even the
police and the armed forces would take the side of the self-help
efforts of the people? Obviously, our politicians are at least
sensible enough in such a case to try to become rather spokesmen
for such a movement and to legalize it retrospectively as fast as
they can, with full amnesty and even praise for all former
breaches.
Alas, we are still very far away from the  enlightenment required
for such a degree and extent of self-help. But there is no law
against enlightening ourselves to that extent. But that requires
sufficient interest and persistence in such studies. Of this
there are as yet all too few signs. Some modern academics have
seen the light and some more or less primitive and more or less
computerized barter exchanges have spread and turned into
business enterprises and have been tolerated by governments by
and large, apart from their tax impositions. But they are a far
cry from monetary freedom in theory and in practice. Even when
they turned into successful businesses for the participants, they
did not cope with the general depressions, mass unemployment and
inflation.
A number of monetary freedom experiments, on a small scale, have
also taken place, but always fearful of legal prosecution and
therefore could not appear and grow openly and freely. Without
full publicity no free market can fully function.

Coming back from my dream to yours :  
How do the local LETS transactions compare with the turnovers now
already achieved in black market transactions, with exchanges
arrived at via second-hand stores, garage sales, charity sales
and markets, bulletin boards in shopping centres, classified ads
in local papers, within friendship-, family- and neighbourhood
circles and those of fellow workers? Do they add much to these?
How much? Are they easier than these exchanges or rendered more
formal and thus more difficult?
Obviously, the present LETS would function better if many
employers, unions, shops and banks did participate. But why
should they and could they do so legally or without risk of legal
prosecution, at this stage? Why should any of the numerous local
and large scale goods and service suppliers want to become
involved with LETS, even assuming that legally they could do so?
How could they benefit from the listed offers? Obviously, LETS
members could and would like to benefit from their offers, e.g.
the offers of Coles and Woolworth and Payless shops. But what
would get the owners of these shops get out of it except claims
against the very limited offers now made in the LETS listing?
The very able, efficient sellers of goods and services and labour
get all too little in return from these circles and to that
extent they are unwilling to participate. And if they offer very
unusual items, like I do, with freedom and peace and justice
literature, mainly on microfiche, they could most likely, achieve
no sales at all from their membership and, like myself, might
also have no use at all for any of the limited offers in these
circles.
For supermarkets and shopping centres and associations of small
shops it would make much more sense if they mobilized their
stocks of goods and further short term delivery potential, much
more directly, via their own tokens, goods warrants, purchasing
certificates or credit notes - if they could legally issue them
or risk their issue. Such certificates would also be gladly
accepted by formerly unemployed or presently employed, in their
salary or wage payments, for at least part of these income
sources.

The ready for sale consumer goods in the shops of a country are
the essential operating capital, without which the fixed medium
and long term capital of a country cannot be put to use. The
present system does not fully mobilize this capital, far less use
it for wage and salary and tax payments. Imagine how gladly shops
and shop associations would like to see their notes used in this
way - for such use would assure them of corresponding sales, when
these notes stream back to them for their "shop foundation" cover
or redemption. If they could pay their suppliers and their wages
and salaries and taxes and utilities and rents with them, their
sales problems would be over and they could employ more people.
And how many people would refuse such notes or accounts or
clearing certificates or credit cards, if their issue and reflux
is honestly and publicly administered?

So far this option has been legally touched but not covered only
via gift certificates and shop currencies. The latter may  be
issued only in consumer credit transactions. Both options could
be rapidly expanded for use as wage payment means. Mutual
acceptance and clearing of such issues could be rapidly agreed
upon for a transition period, until one or several local
currencies and issue centres are agreed upon. However, it appears
to me that such issues would first have to break a barrier of
thinking and practice which LETS members seem to have set up
among themselves, quite apart from the legal barriers that exist
for them.
How many thousands of millions of dollars could NSW shops
mobilize in this way for short term credits to pay wages and
salaries with? How many millions of dollars could thus be
mobilized within Mittagong, Bowral and Moss Vale shopping centres
alone? Perhaps some local bankers and shopkeepers and accountants
could give us an estimate?
Why should any supermarket or shop or service supplier
participate in LETS when they could issue themselves more
efficient, useful  and acceptable clearing house certificates or
goods and service vouchers - if only they were free to do so?

Anyone who has regularly many payments to make and to receive
could act as an issuer or as a clearing centre. Bus companies and
taxies could issue their own money, as could the railway. The gas
and electricity supply companies could and so could an
association of the local landlords. The local lawyers and
physicians and tradesmen could issue their service vouchers or
credit notes. The local government could for its rate, fees and
dues payments. The NSW government could for its registration
fees, dues and taxes and the Federal Government for its income
and other host of taxes. 
One could even argue that any potential issuer should issue his
own notes or clearing certificates rather than depriving other
circulation spheres of their exchange media. Issue of notes and
clearing as a duty, not only as a right!
If freed,  pretty soon local banks, established as note issuing
centres, would tend to unify and simplify issues by discounting
many different private notes, not easily acceptable to many local
people but well enough known to the banks,  replacing them
largely by their own private banknotes and current accounts,
guaranteed and insured by them and likewise limited by free
market rating, voluntary acceptance, mutual clearing and
publicity. Naturally, none of these banks should be granted even
a local monopoly. 

So far there is competition only between credit cards and cheques
- and voluntary acceptance for them. Alas, both are tied to the
Australia-wide monopoly money of the Federal Government, as
managed by its central bank, the Reserve Bank.

If present bankers turned out to be too narrow-minded for this,
soon one or the other businessman would set himself up as a local
banker, operating on the "real bills doctrine", discounting or
exchanging his more general bills in handy denominations for the
less general sound commercial bills and other short term debts
and their corresponding token money issues of other local
businessmen. The market would diversify and unify the issues as
much as would be required by the participants. Monetary history
would repeat itself. Solutions would not always come from the
supposed experts but often from those considered to be outsiders
and laymen.

If such issues were legally possible or illegally successfully
practised, for the transition period towards their legalization,
most LETS members would, I believe, rapidly switch over to them
or would become involved in establishing one or more general
clearing houses in the community, issuing clearing house
certificates or accounts and paying and dealing with them. They
would change from thinking small to thinking large.
As it is, I can see in LETS only a very limited but,
nevertheless, valuable experiment to partly escape the disastrous
consequences of monetary despotism. But, does it have, apart from
the general clearing idea that it employs in its limited sphere,
the inbuilt potential to grow without limits - except those posed
by competition, voluntary acceptance, market rating, publicity
and mutual clearing - into a general local currency for all local
transactions? ( Possibly in competition with some other local
currencies. )
Does it cut or even threaten to cut the roots of monetary
despotism? Or is it considered quite rightly, by our monetary
despots, as merely a harmless and tiny self-help attempt among
the victims of monetary despotism, providing them with some
further illusions to go on rather tolerating than fighting
monetary despotism?
Would perhaps merely preparing an playing a game of full monetary
freedom be more efficient in tackling the ideas and practices of
monetary despotism than this limited practice of mutual clearing?
Or is LETS to be considered as essentially merely a game, with
some limited fringe benefits for the participants, like e.g.
membership in APEX or ROTARY or LIONS or FREE MASON  clubs is?
And is LETS membership as limiting to the horizons of full social
and exchange liberties as such memberships tend to be?

There exists a rich tradition of monetary freedom ideas,
experiments and writings. Alas, it is largely unknown and
inaccessible to most people in most places. My libertarian
microfilming efforts attempt to bring as many of them to the
light, at least of microfiche reading machines, as is possible
for one person to do, as cheaply and permanently as this medium
allows. 
If LETS members want to get out of the kind of narrow corner they
seem to have painted themselves into, and want to explore and
finally practise the full range of monetary freedom options, then
they should, between them, collect, study and discuss the full
range of such writings and ideas and experiments. Between an
estimated 10,000 members in Australia alone, they would have the
human resources potential to do so. But whether they are
interested in to explore this option remains to be seen. If they
have merely the activist mentality for some limited actions, like
marchers and demonstrators, they will never get very far, even if
they should be as successful, as businessmen, as e.g. the members
of the WIR Wirtschaftsring have been in Switzerland, since the
1930. My father was one of its originators and tried to establish
versions of it, involving banks, in Germany, after WW II.

I would like you to start pondering not so much what other all
too limited offers you might add to your listing but, rather,
what general "readiness to accept" foundations and issue and
reflux options you seem to have systematically omitted with your
current LETS systems, e.g.: shop foundation, tax foundation,
utilities foundation, petrol and transport foundation, wages and
salaries foundation, general debt and clearing foundation, bank
acceptance foundation. All these spheres are now monopolized by
monopoly money. With a few limited private clearing exchanges
practised and  fully free clearing and monetary freedom not fully
envisioned and demanded, the powers, wrongs and harms of monetary
despotism cannot be defeated, nay, they are not even challenged.
And when all one's efforts are concentrated only on one limited
kind of experiment and thus experimental freedom in this and
other spheres is not seen as the ideal, i.e. when one does not
adopt a policy of appreciation for or tolerance of other monetary
and clearing experiments, then the own experiments will tend to
have only limited and temporary successes, too. We cannot become
rich by taking in each other's dirty linnen for washing. We
cannot become free in our exchanges by leaving out of our private
planning and actions our main bread earning activities and
confining our freed exchanges only to hobby and spare time job
activities.

I hold that e.g. the Australian shop currencies are much more
promising examples and so was the suppressed bank note issue of
the Duke of Avram in Tasmania and the issue of Grace Brother's
shop currency to satisfy unionist demands for a wage increase
when they built the Roseland Shopping Centre in Sydney.
Peter Sawyer told me also, in a public meeting in Bowral, several
years ago, of an underground IOU exchange and clearing system
somewhere in Queensland, in which supposedly 14,000 people
participated already then. Further details were not given to me
because of fears of legal prosecution of such freed exchanges.

I hold further that even the token money issues of general stores
and the truck shop tickets, outlawed for centuries, were more
promising in their development potential than the present LETS
groups are. 
Other potential issuers and clearing centres should not be simply
asked to join the LETS schemes but, rather, appealed to or
intructed on how to mobilize and liquidify their own inherent
assets. Gas companies could issue gas money, electricity
companies their own electricity money, petrol stations their
petrol money, land lords their rent money, local governments
their rate currency, bus companies their bus money, restaurants
and cafes their food money, physicians and lawyers their
professional service money, tradesmen their technical aids and
service money, etc. Most could be achieved, in one stroke,
through local shopping centre money, starting perhaps with one or
the other supermarket. Historically, even barber ships and
brothels have sometimes issued their own notes and they served
with others, at least as "street money" if not local currency.

If I have not been informed upon further ambitions and plans for
the LETS system for an expanded cover, redemption, reflux and
clearing system for it, one that could and would have a great
impact on the general economy, then it has not been for lack of
searching on my side for any such signs and efforts.
By all means, do go ahead with your limited experiment, and I
wish you more success with them, but do also become aware of
other legal and outlawed options towards monetary freedom and do
at least discuss them among yourselves or remain open-minded and
tolerant towards them, instead of merely ignoring or condemmning
them. 
We will be able to enjoy all the benefits of free enterprise and
free exchange or of a truly laissez faire economy only when all
kinds of monetary and financial freedom systems can be practised
freely and voluntarily by all their supporters anywhere and
anytime. That means we should not confine our efforts to asking
them to join our systems or to set up branches of our favoured
system but, instead, they should make use of all their own issue
and clearing options, using any system that would suit them best. 
Precisely the kinds of goods and services now offered or wanted
within the local LETS are already pretty well cared for by other
exchange arrangements and precisely the goods and service
exchanges needed most to overcome depressions, unemployment and
inflation, are most neglected by it. Am I wrong in this
evaluation?
Fans of total clearing exchanges, like Michael Linton and Conrad
Hopman, tend also to overlook the essential clearing function and
nature even of coins and notes and that these tokens do often
simplify and reduce the accounting labour involved in pure and
obvious clearing transactions. These labours are reduced to the
counting and handling of the holders, payers and payees, who do
not need a common clearing house and monthly accounts from it for
their transactions. Compare how lines at cashiers are often
slowed down when credit cards and cheques are used instead of
cash. Passing easily from hand to hand, notes and coins do bring
about their own kind of clearing automatically. No personal bias
should lead one to exclude such efficiencies. To this must now be
added the advantage that cash transactions are less visible to
the tax collectors.

Let us imagine that some person would be able to earn and spend
all his income in green LETS dollars only and that he would then
be confronted by the taxation office with the demand to pay it a
percentage of the total earnings not in green dollars but in
government dollars. Such a person could be driven into bankruptcy
and condemned to gaol for so supporting himself. Or, like
formerly some natives were, in colonial empires, he would be
forced to sell his labour in additional labour hours, paid for
with official government money only, just to enable him to pay
the taxes imposed upon him. To me this sample of an extreme
success of the LETS system does also show its limitations and its
subjection to monetary and financial despotism.

We can agree, perhaps, on the above listed monetary liberties and
some others and generally on self-help and the freedom to
experiment among volunteers, at the own risk and expense, and on
full tolerance for such experiments, regardless of constitutional
and legal clauses and juridical decisions. 
We could and should perhaps, at least seeing the present
unemployment figures, agree upon a redefinition of the right to
work as the right of the unemployed to supply themselves with
work, without depriving others of it, by undertaking all the
organizational, monetary and financial measures required for this
purpose and to ignore all contrary official regulations, laws,
constitutional clauses and juridical decisions, because such a
basic individual right is involved.
To realize such a basic right, it might be required that
individual regain the right not only to opt out from under
monetary despotism and become monetarily autonomous or sovereign
individuals and voluntary members of autonomous minority groups,
under their own personal laws and contracts rather than under
territorial constitutions and laws - but that they gain the
liberty quite generally to secede as individuals from despotic
and even from majority-democratic or republican States. Monetary
freedom would be just one aspect of this general "panarchic"
freedom. 

   PIOT ( Panarchy In Our Times : meaning also monetary freedom
in our times ), 
                 John Zube.