Presentation made in L'Aquila, Abruzzo, Italia, in January 2013, proposing they consider: 1) issuing a local complementary currency, the Nido; 2) accept Nido in payment of taxes; 3) offer a Nido wage to anyone ready and willing to work a community service job.

1. A Renaissance in L’Aquila:
Revival, Renewal,
Reconstruction
Mathew Forstater
forstaterm@umkc.edu

3. Two Key Problems
1. Unemployment
2. Shortage of essential public services

4. Both problems have a common cause
Lack of money!

5. Euro has fundamental problems
When the economy is working well, the euro
seems to be ok.
But when the economy suffers a
downturn, the euro is not up to the task.
This is a problem facing all of Italy, and the
Eurozone.

6. “What can one region do?”
Is there anything that one region can do to help,
since we have serious problems and cannot wait
for national politicians and European Union
officials to fix things?

7. Many communities using
complementary currencies
These regional currencies do not replace the
Euro, they complement it.
There are hundreds, maybe thousands, of these
in Europe, the U.S., the U.K., and all around the
world, including in other parts of Italy and in
Germany.

8. Complementary Currencies in History
These complementary currencies tend to appear
during periods of crisis.
Many during the Great Depression, in the U.S.,
in Europe, including Italy.

9. Many Different Forms of Local
Currencies
Some are just a record of barter systems.
Some have a fixed exchange rate with the
national or territorial currency.
Recent examples include “Berkshares”, “Ithaca
Hours”, “Brixton Bucks”, and “Bristol Pound.”

11. ARGENTINA – “PATACON”

12. UMKC “BUCKAROOS”

13. Student Community Service
To encourage students to do community service
and learn about modern monetary systems and
government budgets.
On the Buckaroo note it says: “this note
represents one hour of community service by a
UMKC student.” The note is denominated as
“One ROO Hour”

14. Tax-driven Currency
Instead of just requiring students to do service, we
tax them 4 Buckaroos per week for the semester.
Approved community service providers (state and
local government offices, public schools, NGOs, and
not-for-profit agencies) submit requests to the
UMKC Economics Department “Treasury” for
student hours and are awarded “special drawing
rights” (SDRs) as long as basic health and safety and
liability standards are met.

15. Buckaroo Program
Service providers pay students one Buckaroo per
hour, which is equivalent to spending by the
Treasury.
Students pay their tax with the Buckaroo notes.

16. UMKC Buckaroo Program
There is no limit to how many Buckaroos a
student can earn.
Buckaroos are freely transferable (they may
exchange for goods and services or other
currencies)
Buckaroos are a floating exchange rate currency.

17. The Buckaroo is a sovereign currency, issued by a monopoly
supplier who imposes a tax liability in its otherwise worthless
currency.
The Buckaroo is a non-convertible (UMKC doesn’t promise to
convert it to anything) floating currency (UMKC does not peg
the exchange rate).
UMKC only promises it will accept Buckaroos in tax payment

18. U.S. monetary system
The $US is also a sovereign, non-
convertible, floating currency, backed by
the tax system.
The only promise the U.S. Treasury
makes is that it will accept the $US in
payment of taxes.

19. Buckaroo Implications
The Buckaroo is a case of public monopoly.
UMKC always runs a Buckaroo deficit, because
students will earn more than their tax
liability, they want to save some, they lose
some, they keep some as souvenirs.

20. Buckaroo Implications
• UMKC's Buckaroo fiscal deficit is exactly equal to
the Buckaroos saved by the students and their
associates.
• The value of the Buckaroo is a function of what
the students have to do to earn a Buckaroo from
UMKC.
• The Buckaroo functions first to move student
labor from the private to the public domain.
• The Buckaroo has operated and sustained its
public purpose independently of foreign central
bank policies.

21. More Implications
UMKC Buckaroo spending does not depend on
collecting taxes.
UMKC does not need to borrow Buckaroos in
order to spend.
If UMKC tried to reduce its fiscal deficit, it would
deplete Buckaroo savings and create student
unemployment.

22. Denison University DVDs
A UMKC graduate earned his Ph.D. and left to
become an Assistant Professor at Denison
University. He started a similar program there called
“Denison Volunteer Dollars.”
If UMKC decided it would give up its currency, and
join a monetary union with Denison, then UMKC
could not pay students unless it collected taxes
first, or borrowed DVDs in private markets.

23. If UMKC Joined Monetary Union
UMKC would no longer be a monetary
sovereign. It would no longer be a money
monopolist. It could no longer continue to run
fiscal deficits to create full employment and
satisfy the desire of students to save.
Denison would tell UMKC it better get its fiscal
house in order, and so force UMKC to accept an
austerity program.

24. Italy under the Euro
When Italy joined the Euro, it put itself in exactly
the same position as UMKC, if UMKC gave up
the Buckaroo and joined Denison in a monetary
union (or pegged the Buckaroo to the DVD, etc.).

25. Italy under the Lira
Before adopting the Euro, Italy was also a monetary
sovereign, and the lira was also a non-convertible
floating currency backed by the tax system.
But when Italy adopted the Euro, it voluntarily gave
up its monetary sovereignty. Italy is no longer a
money monopolist. Italy is no longer a currency
issuer, but is now, like households, a currency user.

26. How about “Nido dell’Aquila”
The nest is the home. The nest must be
protected. The nest must be kept safe.
This is just a thought, please create your own
name for the currency, have local artists submit
drawings.

27. L’Aquila Issues the Nido
L’Aquila imposes a tax in Nido, say four Nido per
week per household.
L’Aquila offers a community service job to
anyone ready and willing to work, paying one
Nido per hour.

28. Nido Program
Some will work more than four hours per week,
some will work less.
Those who work, say, forty hours per week will
pay their tax and have 36 left over.
Those who are too busy to work in the program
(already working full time) will need to acquire
them from those who have extra.

29. Nido Circulate
In this way, the Nido will circulate in the
community.
Like the Buckaroo and the U.S. dollar, and unlike
the Euro, the Nido would be a non-convertible,
floating currency. Like UMKC and the United
States, and unlike Italy under the Euro, L’Aquila
would be a monetary sovereign.

30. The Heart of L’Aquila
This is a brief over view of the proposal. If you are
interested, I would be happy to assist in any way I
can and that you feel appropriate.
If not, whatever you decide, I will always have a
special feeling for L’Aquila, Abruzzo, and Italy. The
greatest resource of this country is the labor of the
people. Not only the bodies and minds, but the
hearts of the Italian people—and no price, no
matter how high, can be put on the Italian Heart.