Eco Currency

The research provided in this project is a first step into a possible introduction of an ECO-currency. It is clear that the proposition provided is merely a concretization of the research and opens up a world of new questions. The proposition shows that many practical issues still need to be researched, designed for and validated. Future projects could use the foundations this project has laid, to dive into these new questions, and continue the rationale.

In the movie ‘Home’, by Yann Arthus-Bertrand a beautiful image of our earth is given. The movie starts of from how live began on planet earth and how only by a perfect balance between every form of life and every resource, the earth as it is today can be the way it is. This balance though is drastically changing through the acts of humans, resources that took 4 million years to find its position in this balance are ripped out of their balanced places which has drastic effects on the climate and the ecosystem of the entire world.

Nowadays we take for granted is that money produces interest, yet this is a relatively new phenomenon. Bernard Lietaer analyzes the problem of interest and makes the comparison with the growth of a tree:

“Interest on money constitutes one of the most systematic causes of our destruction of the global environment. Consider as metaphor, for example, the life of a tree (or any other living resource): Because of interest, the net present value of any income far away in the future is negligible. So, it literally pays to cut down a tree and put the proceeds in a savings account instead of letting it grow for another decade or century. Similarly, the only types of tree worth planting commercially are the fastest-growing varieties such as pine. (Nobody plants redwoods for commercial reasons.) So even when we plant trees, we are systematically losing biodiversity.“

Perhaps it is not for nothing that, for more than a thousand years, interest on money was prohibited and considered usury by all three major religions. Read more at Lietaers Community Currencies project.

Species found in a single cubic foot around a coral reef in French Polynesia. Photo by David Liittschwager via National Geographic.

Photographer David Liittschwager set out for five different habitats on locations around the world to place a cubic foot. For a period resembling a twenty-four hour cycle he photographed all species that passed through this cube. Resulting photos, making of videos and an article by biodiversity expert E.O. Wilson appeared in the National Geographic Magazine of February 2010.

An interesting article in Dutch newspaper “De Pers” today about Almir Narayamoga Surui. He is the Chief of a tribe in the Brazilian rainforest. He is nothing like the stereotypical image one might have. He uses new networks and technology, such as an iPhone, Skype and FaceBook to help preserve the forest. He even has connections with Google and Al Gore to help spread his cause.

The third scenario is based on interest over environmental value. Imagine you have a piece of land, sea or something else that is worth something for the ecology. A taxator will define the worth of this specific object according to Simpson’s diversity index. Every month interest is paid in ECO’s over this amount.

The second scenario. Many of our sources and research (this, and this TED-talk give a good introduction) show that a very good way towards reaching a goal is by collaboration and a bottom up approach. We don’t need big institutions, a lot of rules and bureaucracy, but allow a self-governming emergent system to grow. This is but one of the two main pillars on which this scenario is build.

This is the first of a series of scenarios. The starting standpoint we took was that a currency should be backed up by ‘real’ value. In the past this used to be the case with gold. Gold has some good properties which make it very valuable as a trading currency, and has been used as this for over 4000 years in a almost all cultures.It is not possible to get more through manipulation, and is thus a very good way to measure wealth.

Adding monetary value to CO2

This is an overview of the carbon credit system as it was formalized in Kyoto (1997). The aim is to understand what we can learn from this system with respect to proposing an eco currency. Both try to introduce a non-material good into the financial market in order to keep it from being overrun by current economy.

In an article by the Dutch CPB (bureau for economic policy analysis) the application of the contingent value method is critically assessed for cost benefit analysis. They question whether nature and landscape values can be expressed in Euros. Although the method is widely used in assessing e.g. infrastructure projects, many critics remain.