Thursday, June 14, 2012

Money on the Sneakernet


It's kind of an ugly word, and it makes me think of those Gordon Gekko types sitting around, cigar in mouth and feet up on desk-- you know, the ones who greenlight productions like Teenage Mutant Ninja Turtles III, Troll II, and any movie starring Jean-Claude G-d Damn I Can't Act.

But let's be real: money really does make the world go 'round.  That's not saying I'm an anarchocapitalist, but we need an abstract representation of the value of labor and commodities.  And rather than reinvent the wheel, why not use money?

Here's the problem, though: money is scarce (for most of us... if it's not for you, please, hook me up!), but the types of things we can schlep around the Sneakernet aren't: movies, books, music, etc.  These things were scarce when you had to have a physical copy of the book, or the physical piece of vinyl record, or the actual copy of the VHS tape.  But now that everything can be copied a bazillion times... how do we determine the value of something?

Perhaps "scarcity" can be replaced with "difficulty of acquisition."  It's pretty easy to get a Kim Kardashian sex tape anymore, but much harder to acquire, say, a Moldovan passport in 48 hours.  (Not that you'd need one.)  But the same thing holds true for, say, people looking for music on the Sneakernet-- while something can be infinitely copied, we still have to get a copy of it first.

That's actually a boon for indie artists, and let me tell you why: if you're a talented person, I want your music.  And I want it badly enough that I want to be one of the first people to get ahold of it and listen to it. So when one of my favorite bands, The Shondes, needed help getting a new van after theirs was stolen, I was more than happy to give them money.  Why?  It's not just because I want the music that they've already produced.  It's also because I am investing in the music that they will produce in the future.  Because that's the scarcest commodity of all!

However, it's a bit tough to support every Kickstarter project that I like.  (Believe me, THE WOMAN would for some reason rather eat than have a new copy of random indie albums.  I don't get it.)  So what if, rather than basing a system of exchange on sharing scarce resources (like markets in gold and BitCoins), we based exchanges on obligations to other people?

Enter RipplePay.  It's a system built on IOUs, but you can trade the debt of people to be able to pay other people.  You know that scenario: I owe you $10, but you owe our friend Bill $10.  The most direct way to pay that off is for me to hand Bill $10.  Ripple automates this, and allows us to, in a way, create currency out of nothing.  So perhaps I'm broke as heck and want to thank you for the USB drive full of folk music you gave me... instead of just promising you some housecleaning services, I put an IOU out, and then you can trade that IOU to other people just like it was cash!  It has to be a trusted network, but if you're already in the Sneakernet, hopefully you're meeting people who you can trust.

Because you're creating a currency out of nothingness, you can actually reward your friend for creating new music by giving him an IOU that he can spend with anyone else who would value your IOU.  If he publishes enough music, you might be willing to give an item you might have put on eBay to someone else that he owes something to.  Savvy?

Anyway, just thoughts.  Hopefully they're slightly-liberating ones.


  1. Interesting idea, I'd like to see it explored further in a brainstorming/thinktank kind of situation. To that end, are you familiar with the 'local currency' movements most notably represented by the town of Ithaca, NY, and the Ithaca Hour? If not, you might want to check it out. They have a system based on (obviously) time, so that one hour of a store clerk's time is worth the same as one hour of a neuro surgeon, theoretically. So in practice, it is a Services Currency, and that might dovetail nicely with the Obligation Currency you were discussing. Also, a fiction recommendation: The Color of Distance by Amy Thomson. There is a fictional race in this book that operates under a system similar to what you have described above, an interconnected web of obligations/debts, both to other members of their race, and also to their environment and neighboring species. She delved fairly deeply into their web philosophy in the novel, and I think you might find the book cool/interesting, and perhaps direct discussion with Ms. Thomson regarding economics/balance might also interest you. :)

  2. Thanks for the feedback! I actually have some BerkShares sitting in my pocket at the moment... they're a little different in that they're local currency but they're denominated by $$$ rather than by hours, which makes them a little easier to conceptualize for the average person, I think, but a little less equalizing.