In 1932, a mayor of Austria’s small city Wörgl printed “alternative money.” It was to realize the demurrage currency proposed by economist Silvio Gesell, who passed away in 1930. He printed alternative money with the legal currency issued by the Austrian central bank as collateral. This alternative money is called a stamp scrip.
When you look to the right side of the note, you can see the blanks marked from January to December. The face value of the currency is recognized only when you buy and put a stamp-like label in the blank every month. The label price is equal to 1 percent of the face value. The recipient of this alternative money rushes to hand it over to someone else before the month changes. Otherwise, owner will lose 1 percent.
It was a time of the Great Depression. In every city, unemployment rates were high, economic activity contracted and money was not circulated well. But as this alternative money began to circulate, unemployment was near zero, the economy revived and taxes were collected a lot. So, the city hall began to spend money, such as laying asphalt on the road and building a ski jumping platform.
Then six neighboring cities quickly copied the miracle of Wörgl. The city's mayor, Michael Unterguggenberger, became a celebrity and he was flooded with requests for lectures. That is, he became the master of all the deacons.
The following year, however, the experiment was discontinued. This is because the Austrian Supreme Court supported the central bank's monopoly on currency issuance. As the alternative money disappeared, the unemployment rate quickly soared to 30 percent.
It was not long after celebrating the millennium. As central banks printed helicopter money, the economic system began to twist. The central bank repeatedly lowered interest rates and finally the nation entered the era of zero interest rates. The central bank even declared negative interest rates, but they were not actually implemented. Because people had to deposit their money and pay interest, but people with money were not that naive.
The central bank even declared negative interest rates, but they were not actually implemented widely. It was difficult for people with money to easily accept that they had to deposit money and pay interest. Thus, for example, the target was customers with deposits of more than 2 million CHF in Switzerland, which was lowered to over 250,000 CHF last year.
Money should be a means of revitalizing the economy. I hope 2022 will be a year in which money is well circulated and people's livelihoods improve.
