Why Money Needs an Expiration Date (and what that has to do with time banking)

If there's one basic law of nature you can rely on, it's this: Everything dies. 

Yes, it's a bummer. Everything weathers, everything decays. Bread gets moldy, homes spring leaks and cars break down. It doesn't matter how long it takes- whether it's minutes, years or millennia. Nothing lasts forever. 

Nothing, that is, except money. 

And that's a problem, because everything else you can buy with money will eventually go bad. Heck, even the person who currently "possesses" all that money won't be around forever. Because money never "rots", people hold onto it for dear life instead of putting it back into the economy where it belongs. Money piles up upon itself and is handed down through generations, allowing children of the rich to stay rich regardless of their own effort. Do you ever look at Paris Hilton or the Kardashians and ask why? Why do they deserve so much while the rest of us get so little? What makes them so special? 

Inflation sort of solves this problem in a roundabout way,  but it's more of a stealth rot- instead of you directly losing money, everything else just becomes more expensive. The problem with inflation is that 1) it's really hard to control and 2) people don't understand why it happens, so they get upset. 

The more straightforward route would be to implement a fee for storing money in banks, but economists always claim that that wouldn't work because people would just take out their money and hold it in cash. When discussing a contributist economy, it's important to remember that most of the assumptions we have today about how economies must function no longer hold. Our current system isn't a law of nature: It developed over centuries through the random interactions of strangers and the writings of philosophers like Adam Smith. 

Money works in a completely different way post-transition. For one, it's designed to be used, not abused. "Abusing" your money may mean hoarding it, using it to negatively influence others or just allowing it to sit and earn more money on top of itself via the scam we call "interest". 

How many of us know where interest actually comes from? True, when you have a savings account it comes from loan returns, but when you take out a loan, the interest required to pay it back doesn't exist in the economy! Here's the kicker- neither does the money itself! Banks create money out of thin air whenever loans are taken out, and through "interest" that constantly compounds upon itself, these loans can never be fully repaid. 

That's economic slavery. We literally can't afford to let it go on any longer.

Contributism is based on the principle that those who contribute more deserve more. Money can only be "earned" (read, created) through doing work which benefits others in your community. It then circulates, and is taken out of circulation when someone needs to purchase something. Time credits are one implementation of this idea: An hour of work (any kind) is always equivalent to an hour's time credit. 

Time credits are only good for certain basic community service applications though, as some jobs are harder and require more skills. For these, payment could vary based on supply and demand. Is your city running short on doctors? Place an ad online. Raise or lower the listed salary based on the responses you get. Nontransferable time credits could be used to ensure only people who contribute to the economy get rewarded. 

Nontransferable? 

Yes, nontransferable. Making some forms of money nontransferable- like checks or airline miles- solves a lot of problems. Nobody can steal your money because it's only usable by you. Nobody can earn money by exploiting other people because money only goes to natural persons, not organizations or corporations. While you may not be able to directly give your money to someone else, you can still buy a gift and give it to the person instead.

The full effects of this take a while to sink in. Landlords no longer exist because they can't spend the money they receive as rent. Debt is eliminated, as is every other middleman between a person and what they want to buy. The end result is that only the people who directly benefit from something "own" it. 

"Money", then, becomes a token agreement between the individual and society. It's recognition of a job well-done, and a special gift to you as thanks. In this future, money is a claim on a portion of the world's resources- one that belongs to you and you alone. Viewed this way, why would you want to give your hard-earned money away to other people? The Global Assembly makes sure everyone has financial security in the first place, since children and the elderly both can earn time credits for participating in social life or even just being around,  

How does it work? 

Time credits are earned by working on community projects your local assembly approves. Keeping the streets clean, working on a community garden or tutoring children after school can all be "community projects". The project manager receives a set amount of blank time credits and a notepad to keep a record of who attended the project, what they did and how many time credits they've earned. Like a check, the recipient of the time credit is written on the credit itself unless they request to "keep it blank". These records are logged, entered into a computer and used to calculate how much a person has contributed over the course of the year (for voting purposes)*. 

Spending your time credits is straightforward. Just go to the store with your community membership card and credits in hand, then grab what you need. 

Once a person has received their time credits, they can hold them for up to one year. After that, they need to be put in the bank or reinvested into other communities since they expire. 

While in the bank, we charge a 2% per year storage fee to encourage people to reinvest their money into the economy by buying shares in other communities around the world. If money is sitting around for years at a time, it's not doing its' job. 

Money constantly circulates, doing good as it moves along. The role of the time bank is a clearinghouse and loaner for large purchases- (like homes and cars). The money is then paid back plus a fixed fee proportional to the amount of money taken. For example, if the time bank gives you 5000 hours to buy a house and charges 500 for the trouble of loaning out the money, this is not interest, and that's what is so important. No matter how long you take to repay your loan from a time bank, the total amount of money you owe will still be the same ($5500)- it doesn't grow with time. This stops the "debt trap" where no matter how quickly you try to pay off your debts, the amount you owe just keeps growing.. and growing.. and growing. Borrowers can't claim that they were taken by surprise anymore, so they must repay their loans. 

There are some things that time credits can't buy because they aren't for sale: land, natural resources and the hard work of other people come to mind. 

Hopefully, you're beginning to see some of the positive effects this new banking system will have on humanity. Corporations can't abuse their wealth, nor can extremely rich individuals. The only person who gets to decide what you spend your hard-earned money on is you. 

*In order to remain a community member, each person needs to pay taxes in the form of a set amount of time credits weekly (say, 10). They can donate excess time credits in return for votes in the regional assembly. Depending on what percentage of their yearly income they donate, they get more votes.