5. Lets Abolish Money? Is there a Community Outside the Community of Money?

5 Lets Abolish Money? Is there a Community Outside the Community of Money?

The past decade has seen the emergence and proliferation of local exchange and trading schemes (LETS) in the UK. Advocates have claimed that LETS constitute an important challenge to the global money economy. It is argued that LETS overcome the exploitation associated with the global money economy, that LETS overcome the fetishism of commodities inherent to the money economy and allow the unmediated production and exchange of use-values. In this way it is argued that LETS overcome the alienation inherent to the money form and allow for a revitalisation of local communities.

The small, self-sufficient communities envisaged by advocates of LETS is a well-established Utopia. There is an essential continuity between Adam Smith's tribe of hunters and shepherds trading sheep and vension and the postmodern eco-warriors trading New Age trinkets and alternative medicines. What these have in common is the way in which money is conceptualised. For both money is or can be simply a medium of exchange: a harmless device allowing the exchange of equivalent values between free and equal individuals. But whilst Adam Smith was concerned to overcome the simplistic formulation of the mercantilists, which suggested that profit derived from the accumulation of money, the postmodern eco-warrior blithely accepts the mercantilist proposition. They go on to repeat the nineteenth-century doctrines of Proudhon and his followers that the evils of capitalism can be avoided by robbing money of its status and privileges. Nowhere is this more obvious than in the claims being made by 'green' commentators about the impact and possibilities of LETS.

These are bold claims and have been developed from theoretical perspectives which are explicitly anti-foundationalist in their orientation: positions from which social forms such as money are denied material determinations and historical context. In this chapter I subject these claims to the analytical rigour of the historical materialist perspective and the analysis of money developed by Marx in both his early 'philosophical' writings and the later accounts developed in Capital and the Grundrisse. I shall argue that Marx's approach is highly relevant in analysing LETS for two main reasons. First, Marx developed his own theory of money in the context of a monetary crisis and in opposition to writers such as Proudhon, who believed that the contradictions of capitalism could be overcome through the reform of the money system. Second, a major preoccupation of Marx was the way in which money destroyed communities and the way in which the abstract regulation of society through money and the law resulted in mystified and fetished struggles to reinvent communities on the basis of religion, nationality and locale. In other words, Marx's approach allows us to explore both the value relations underlying the development and operation of LETS and the way in which LETS constitute a fetishised and mystified reaction to the alienating contradictions of the money-form.

Lets Begin With Sociology . . .

Following the tenets of mainstream sociology it is possible to analyse LETS as an ideology and as a social movement emerging from the increasingly reflexive nature of the highor postmodern social order. In other words, we are back to the cognitive and aesthetic models of social consciousness derived from neo-Kantian and poststructuralist social theory, which were analysed in chapter 3. As we saw earlier, the category of risk has become a central motif in the models of social action and consciousness derived from both positions. Whilst the academic literature on LETS is undeveloped, it is possible to construct models drawing on the dominant currents of (post)modern social theory. Developing the neo-Kantian approach, it is clear that money for writers such as Anthony Giddens (1990; see also Dodd, 1994) is a symbolic token universalised by the development of modernity as a means of linking 'economic' transactions in time and space. The development of LETS would reflect the increasing lack of trust, which reflexive individuals are prepared to invest in modern 'expert systems' such as the economy and the state, as modern 'symbolic tokens' are distorted by the increasingly intensive rate of development in the late-modern order. In this sense, it would be possible to conceptualise LETS as a form of local money created by reflexive individuals in an attempt to circumvent the risks of global money and foster increasing levels of trust among local networks of social actors. LETS could thus be seen as a 'utopian realist' strategy by a 'new social movement' premised on the contextual (re)negotiation of value and the circumvention of socially necessary labour-time by new negotiations of value on the basis of locally, and often interpersonally, constructed social relations (Lee, 1996). In other words, LETS is an attempt to reclaim the rationality of money which has been distorted by the increasingly out-of-control nature of the global money system.

The poststructuralist approach would presumably attempt to understand LETS as a counter-ideology: a discourse resistant to the totalising and globalising discourse of global money. The focus of LETS on the local would be seen to highlight the way in which politics increasingly takes the form of a 'neo-tribalism' (Maffesoli, 1991), which rejects the abstraction inherent in the commodity and state forms for the immediacy of the locale and the personal relations contained therein (Lash and Urry, 1994). In this sense LETS would constitute a 'symbolic space' in which to recapture a sense of 'identity' and 'community' and to remoralise the spaces emptied out by the abstract dynamics of modernity. LETS confront the dangers posed to the identity sustaining practices of the 'decentred' self: the risks posed to identity and affectation by the abstract circulation of images and symbols and a manifestation of cultural heterogeneity in the context of the homogenizing 'economic' dynamic of the global money system (Appadurai, 1990). In other words, LETS emerge in response to the increasingly totalising impact of money as an ideology or discourse.

The immediate problem with both the accounts anticipated above is the understanding of money on which they are premised. In one, money is merely a symbolic medium of exchange which has been de-rationalised by the distortions of high- or late modernity and can be re-rationalised through the semi-utopian reflexive projects of new social movements. In the other, money is merely a simulacrum: a totalising discourse detached from the 'real' economy which threatens totally to subsume the 'life-world' of individual social actors. I have thus returned in both accounts to the notion of money as 'sheer intelligence'. To return to Derrida (1992), the distinction between money as money and money as LETS is resolvable only in respect of the discursive meanings which are ascribed to these phenomena as forms of money. This, however, is highly problematic. Human subjectivity and consciousness cannot be constructed through money because in capitalist society money is the (partial) denial of subjectivity and consciousness. In capitalist society money articulates the historical form of alienated labour and is precipitated through an historical process which denies the integrity of human consciousness.

. . . So Lets Get Real!

In order to understand money we need to begin with an understanding of history and the relationship between history and human consciousness. In the process of history, individual wills are conditioned in 'class' ways; history is the result of contradictory class interests and forces and therefore human agency gives rise to involuntary results. There is a crucial ambivalence to our presence as human beings in history: 'part-subject, part-object, the involuntary agents of our own involuntary determinations' (Thompson, 1978: 88). In other words, individuals do not derive symbolic meanings from money and construct their subjectivity from cognitive or aesthetic structures of economic meaning. Money is a contradictory social form which both allows and denies human subjectivity. It is, therefore, important to analyse LETS in the context of the historical materiality of the crisis tendencies of capitalist development, as this allows for the development of LETS to be analysed as an important moment in the crisis and recomposition of the capital relation. This is important as Marx's theory of money was developed against the monetary crisis of 1857–8 (Bologna, 1993) and was premised on an attempt by Marx to highlight the way in which the crisis of money was merely the appearance of a more fundamental crisis of the capital relation. Marx used this critique to highlight the weakness of utopian socialist strategies which believed that the crises and contradictions could be overcome through the reform or abolition of money. Similarly, we can argue here that LETS have emerged in the context of a prolonged crisis of money (monetarism) and that LETS are a partial and mystified attempt to resist and refuse the money form.

LETS can become a genuine threat to the abstract power of money only if we really understand what money is and the role played by money in the social regulation of capitalism. This requires an engagement with the current sociological orthodoxy, which suggests that popular consciousness and political mobilisation are no longer informed by class, but by cultural characteristics and 'life-style'. The development of LETS is premised on an emergent 'green' ideology and membership of 'green' social movements is defined by a commitment to the ecological preservation of the planet and forms of 'alternative' lifestyles which support these objectives. In other words, new social movements constitute an idealist psychological reaction to the risks inherent to global modernisation, and, indeed, the academic literature on new social movements is dominated by accounts which focus on the psychological factors which result in the formation of ideological discourses (Beck, 1992, 1995; Giddens, 1990; Melucci, 1989; Tourraine, 1982). However, the ideologies of new social movements, and indeed all ideologies, are not fabrications or merely the projections of abstract ideas, but are the alienated forms of expression of historically developed social relations. An understanding of money and the social regulation of money is central to understanding the development and form of modern ideologies and the forms of consciousness and action articulated by new social movements.

In the Communist Manifesto Marx and Engels graphically describe the way in which feudal communities were 'pitilessly torn asunder' by the development of capitalist social relations and the way in which the 'nexus between man and man' had been reduced to naked self-interest and 'cash payment':

Constant revolutionising of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones. All fixed, fast-frozen relations, with there train of ancient and venerable prejudices and opinions, are swept away, all new formed ones become antiquated before they can ossify. All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face with sober senses his real conditions of life and his relations with his kind.
(Marx and Engels, 1965: 37; emphasis added)

Communities have been destroyed (dissolved into thin air) by the impact of money, and illusory communities have been constructed on the basis of the nation-state and religion. It is because money destroys community that the spiritual aspirations of individuals for a sense of moral community take on alienated forms such as religion and nationalism. In capitalist society the absence of a real community is thus compensated for through the construction of illusory communities of religion and the state. This illustrates the importance of placing the development of LETS in its historical context. Whilst the crisis of Keynesianism appears as a crisis of money (monetarism) it obscures a more fundamental crisis of the capital relation. The imagined communities and Utopias of Keynesianism (Fordism, social democracy, planning) have been destroyed by the global restructuring of capital. The discourse of the new social movements is an attempt to capture a new postmodern and neo-liberal form of 'associational' community. A community for the neo-liberal world based on flexible networks of associates. It constitutes an emergent 'do-it-yourself' culture emerging from a crisis of state planning and an increasing lack of trust in global money. The LETS networks epitomise neo-liberal forms of association.

While it is certainly the case that the politics of the new social movements could pose a threat to the new global order, this does not detract from the fetishised and alienated nature of 'community' underlying LETS ideology and practice. Below I explore this proposition further and argue that LETS constitute an abstract form of social regulation which perpetuates rather than ameliorates the fetishism of commodities, and that the struggle to restore humanity must be premised on the development of forms of social organisation and social consciousness through which humanity can bring its social powers under self-conscious control (Clarke, 1988). I shall begin by exploring the way in which LETS have developed in the UK and the social relations which are created and sustained by LETS networks.

What Are Lets?

There is nothing particularly new about local exchange and trading systems. The cooperative movement in nineteenth century Britain, various barter schemes which emerged in both the USA and Europe during the Great Depression of the 1930s, and the 'Time-Dollar' schemes which developed during the 1980s in the USA are all examples of locally-based schemes for fostering mutual cooperation and ameliorating the worst effects of the global money economy. There are, however, a number of important ways in which LETS differ from earlier schemes. First, LETS schemes are not based on 'barter' but allow exchange through a local 'currency'. Second, the LETS currency is not issued by a single body but is created by the individuals who take part in the schemes. There is thus no limit on the 'money supply'. Following from these points LETS are presented as inherently empowering for the individuals taking part, allowing them to participate actively in the regeneration of their local economies.

The past decade has indeed seen a massive proliferation in LETS. During the 1990s the number of LETS in the UK has grown from five in early 1992 to 200 schemes with 20,000 members by late 1994 (Lang, 1994). These systems allow individuals within a local community to exchange goods and services outside the money economy. Goods and services are traded through a unit of account which is given a name by LETS members themselves and which is usually symbolically related to the locale (New Berries in Newbury, Bobbins in Manchester, Offas in Bishops Castle, Yorkies in York, etc.). The members of the LETS scheme list the goods and services they have to offer and the goods and services they desire in a 'directory', which also specifies the number of LETS units charged for a particular service. The directory also gives the telephone numbers of all members to the scheme in order that individuals wanting to trade can contact each other directly, agree a 'price' for the service and goods on offer, and carry out the transaction. The transaction is 'paid' for through the use of 'cheques' written out in the LETS unit, which are subsequently sent to the treasurer of the association who keeps records of all transactions and publishes regular statements showing the balance for individual members.

In order to understand the way in which LETS work it is important to explore the principles on which the schemes were founded. The idea of LETS was first introduced into the UK by Michael Linton, a Canadian, who set up a LETS scheme in Courtenay, British Columbia, and who gave a paper at a conference organised by 'new' or 'alternative' economists to run alongisde the G7 Economic Summit in 1986. According to Linton (1986), LETS are defined by five criteria:

1. LETS are non-profit making.
2. There is no compulsion to trade.
3. Information on balances is available to all members.
4. The LETS unit is equal in value to the national currency.
5. No interest is charged or paid.

The non-profit making status of LETS is essential in order that all spending reflects work done or services provided. This avoids the 'non-productive' trading in money which results from speculation and the charging of interest. LETS are thus premised on a particular view of what money is, and the role played by money in the social regulation of society. The view of money presented by leading advocates of LETS (see, for example, Lang, 1994) suggests that the essence of money is to provide a measure or record of the work carried out by individuals in order that they can be justly rewarded for their effort, skill and expertise. LETS are thus based on the 'new economics' philosophy, which regards alternative currencies as a way of encouraging the use of money as a means of exchange rather than a medium of exploitation (Sallnow, 1994). The problem of money, according to such a view, is that in the modern world money has become a commodity in itself and the speculative activities of banks and financial institutions, and the monetary policies of the state and supranational institutions, undermine the function of money as a measure of work; which instead becomes the means by which the state and transnational corporations dominate society. The main enemy is the 'interest' paid to speculators, which allows money to be earned without any work being done. The result is that huge sums of money constantly circulate the global financial systems, whilst there is simultaneously a shortage of money to pay workers to provide essential public needs.

The relationship between LETS and global currency can be broken down into four propositions or hypotheses, first outlined by Nader (1992). These propositions highlight the conceptualisation of money being developed by advocates of LETS:

1. The 'real' wealth of society derives not from money but from the time which people have to help others, and the willingness of people to use that time in helping others. LETS demonstrate that there is a substantial reservoir of time, which is untapped by the market economy.

2. Society has two economies: the market economy and the household economy of family neighbourhood and community. Many of the problems faced by society are a result of the erosion of the latter by the former.

3. Individuals respond to rewards other than money and society lacks the money to reward all the activity 'it' wants and needs. LETS respond to the fundamental human need to be needed and valued through a combination of additional purchasing power and psychological reinforcement.

4. Money — even a lot of it — cannot completely substitute for what the family, neighbourhood and the community used to provide.

There is a number of perceptive insights contained in the proposition, but there is also a number of limitations. The first two points correctly highlight the existence of time and space outside the global money system which could be used to fulfil human needs. There is, however, a failure to consider the differentiation between money-as-money and money-as-capital, and the way in which the latter involves the constant and increasing compression of time and space in response to the valorisation imperatives of the postmodern flexible accumulation strategy of global capital (Harvey, 1990). In other words, locating the time and space for initiatives such as LETS is likely to become increasingly less feasible the more intensified the process of global capital accumulation becomes.
Following from this the second two propositions are fundamentally flawed as they imply the voluntaristic generation of counter-cultures and counter-moralities 'outside' the economic dynamics of the global money system. They ignore the way in which postmodern morality (Bauman, 1991) and culture (Featherstone, 1991) are generated behind the backs of social actors through the material contradictions of postmodern capital accumulation (Jameson, 1991). There is a strong 'ethical' or 'moral' basis to LETS schemes which are articulated as an oppositional counter-culture against the fragmentation and alienation inherent to the abstract power of the global money system. This can be illustrated by exploring the principles of the LETS scheme in Brixton, south London, which is founded on the members' commitment to each other and the wider community and on the following ethical principles:

1. To foster trade within the local community in a cooperative spirit, particularly in those areas currently undervalued by the global money economy.

2. To empower every member of the community, particularly the unemployed and those working without pay, to take an equal role in its activities.

3. To encourage an awareness of the real value of goods and services — this involves minimising or excluding environmentally or socially damaging activities wherever possible.

LETS are thus presented as being a way of revitalising a sense of community and of redressing the problems created by the global money economy. LETS simultaneously provide an inflation- and risk-free currency whilst revitalising the social interconnectedness of individuals through a reconstruction of community and a rebuilding of trust. This is to be achieved through the re-moralisation of commodity-exchange in order to replace the affective content which has been emptied out by the abstract dynamics of the global money economy. As I shall show later in this chapter, this is highly problematic as money is the denial of affectivity. Affectivity implies a relationship charged with 'feeling', 'emotion' and 'desire'. In any society regulated through exchange-value, individuals only have relationships with things: a perverted and fetishised affectivity. The love of the thing denies the mutual and reciprocal love of others. The negation of real community is inherent in the money form. The problems of money cannot be overcome through the reform and re-moralisation of monetary relations because money denies the pre-existence of a moral or affective community outside the community of money.

Lets Transform Society?

Advocates of LETS argue that the schemes revitalise the sense of community within localities. Money is seen as resulting in the fragmentation of communities as the activities of transnational corporations physically destroy communities in order to seek out cheap labour in the global marketplace, whilst the anonymity of monetary transactions dissolves the 'affective' content of economic exchange. LETS, it is argued, overcome the anonymous and abstract relationships which have resulted from the dominance of the money economy. The schemes break down barriers of social class and cultural difference and allow members to make friends with people from a diverse range of social backgrounds. LETS constitute, therefore, an attempt to revive a sense of 'community' (neo-Gemeinschaften) within the locale. Following the edicts of communitarian philosophy (for example, MacIntyre, 1981, 1988; Taylor, 1989; Walzer, 1983), LETS allow the 'democratisation' and 'reflexive mediation' of money as an 'expert system' and provide a solidarististic basis for the creation of 'green' micro-communities. LETS are presented as a way by which local communities can wrest an element of local control back from the nation-state and the global economy. LETS are thus an important moment in an emergent 'green' discourse, and the circumvention of money is usually linked to the environmental costs imposed by the operation of the global money economy. The forces of competition result in a global division of labour and the movement of goods and labour around the globe in ways which threaten to destroy the natural environment. LETS schemes are thus also said to have important ecological benefits as the production and exchange of local services avoid the need to transport goods over large distances and therefore reduce pollution in the form of CO2 and packaging. LETS allow a more efficient use of non-renewable resources through the way they encourage the sharing of expensive equipment and the repair rather than the replacement of defective consumer durables.

LETS have also been presented as a way of countering the problem of long-term unemployment. In the context of the present crisis, it allows cash-starved communities to release the skills and competencies of individuals and thereby enrich the local community. LETS schemes have the potential to widen the contacts and skills of the long-term unemployed and provide them with access to expensive capital equipment which would be needed in order for them to set up in business. LETS allow for the re-vitalisation of local communities through the way in which the wealth created through the schemes does not leak out of the locale through the profits and interest paid to TNCs and banks, and encourages individuals to use local services rather than imports from across the globe. In this sense LETS are indeed a way of avoiding the risks inherent in the global money system. As a leading member of the Haverfordwest LETS group argued:

If you give me a cheque for 50 'lets' it could not possibly bounce. No one loses anything by the deficit incurred. Its your deficit that's all. There's no interest charged, no fixed time to pay, the liability just sits there in a book or a computer. LETS can't be stolen or borrowed: you can't use them outside your area, so there is an inbuilt trust.
(Guardian, 12 March 1994)

In a study of a LETS scheme in Calderdale, Williams (1996) found that whilst the scheme did bring important benefits to the poor and unemployed workers, the operation of the scheme reproduced the advantages and disadvantages of the money economy. This was particularly the case in respect of the price paid for the goods and services provided by professional and middle-class members of the scheme. Indeed, LETS schemes are currently clustered in affluent areas with low unemployment, and there is evidence of the (unintentional) exclusion of marginalised individuals on the grounds of 'taste' or 'life-style'. In other words, the access to LETS schemes is regulated by what participants have to offer rather than what other members can give. As we shall see, this is a result of the existence of LETS communities within the wider community of money. The abstract nature of regulation, and the technical and educational resources required to run a LETS scheme, serves to exclude marginal social groups and, as a result, LETS schemes are dominated by professional and educated elites.

There is also the extent to which LETS are ideologically dominated by 'green' ideologies through the well-developed links between green activists in both local schemes and the national LETS Development Agency. In this sense Lee (1996) argues that LETS are socially and ideologically dominated by an emergent graduate underclass: a lumpen-intelligentsia made up of green, vegetarian but unemployed graduates. In this sense LETS schemes often exclude the poor on the grounds of 'taste' and 'life-style'. This has often been partially overcome by the involvement of local authorities (i.e. the state) in the establishment of LETS schemes. This is reflected in the geographical concentration of LETS schemes in the UK, which as Lee demonstrates, are in relatively affluent areas. Lee argues, therefore, that LETS are part of an attempt to develop a locally defined 'moral economy': an attempt to resist the power of money to 'disinfest' the moral content from economic transactions; an attempt by local people to restore a moral content to transactions through direct social relations and trust. The legitimacy of the LETS schemes is thus based on trust and reciprocation. This is one of the most potent sources of exclusion in the operation of LETS schemes: the basis of trust in a society dominated by private property is mistrust and only the trustworthy are given access to the community.

Lets Transform Capitalism?

LETS attempt to confront one of the principal contradictions of capital accumulation: that human needs and capacities are subordinated to the valorisation of capital. Capital accumulation is marked by the coexistence of two simultaneously occurring circuits of money and commodities: M-C-M' and C-M-C. Needs and capacities which cannot be subordinated to the circuit M-C-M' are not met or utilised. LETS are presented as a way of circumventing the circuit M-C-M' by allowing the local mediation of needs and capacities through a circuit C-M-C. LETS thus allow trading to take place where money in the form of sterling is not available through the way in which they create interest-free credit on demand for members of the schemes. LETS are presented as a powerful mechanism for regenerating the local economy. The wealth created in the form of LETS currency is specific to the locality and the non-transferability of LETS currency means that locally produced wealth is reinvested locally for the benefit of the community. The unemployed, for example, can trade in LETS schemes and acquire skills and resources without the need for 'credit', which would inhibit their escape from poverty in the money economy. This is because LETS schemes allow members to spend before they have earned. Members who spend are not seen as being 'in debt' but being 'in commitment' to the community to do work in the future. In this sense, creating LETS units by spending is seen as a 'social service' as it allows others to spend and thereby enriches the wealth of the community. The publication of accounts allows for the regulation of the system to be based on mutual and informal recognition of positive and negative balances by members of the scheme. Members with high negative balances are approached with offers for them to offer work/services, whilst members with high positive balances are approached by individuals keen to sell to them.

As mentioned earlier, prominent advocates of LETS argue that the LETS currency should be roughly equivalent to sterling. In the UK 65 per cent of LETS schemes currently link their LETS unit to sterling (Lang, 1994: 150). For many advocates of LETS the importance of relating the LETS currency to the national currency is important in order to attract small local businesses to participate in the schemes. Small businesses will often charge for goods in proportions of LETS currency and sterling depending on cash-flow requirements. Local businesses are able to benefit from the schemes owing to the way in which their customer base is expanded by people who are LETS-rich but cash-poor. Local businesses also benefit from LETS schemes through the way in which they enable extra workers to be paid or part-paid in LETS. Whilst most LETS schemes do relate the value of the LETS unit to sterling, a further ethical element of the schemes is that individuals participating in the schemes are able to 'revalue' work according to the individual circumstances of the traders. Rather than the anonymous and abstract relationships which mark the money economy, the individuals participating in LETS schemes are often personally known to each other and can account for one of the parties being unemployed or disabled. Furthermore, work given a low value in the money economy, but which is tedious, arduous or dirty, can be revalued to reflect the socially useful nature of dirty but essential jobs. For this reason, LETS are also presented as having positive implications for gender relations as they allow a revaluation of the jobs and services traditionally provided by women. These concerns have led other LETS schemes to reject the idea that the LETS currency should be tied to sterling and have either made the LETS unit time-based or have introduced time-based factors into the way in which the value of goods and services are calculated.

LETS clearly offer an opportunity for the unemployed to attain useful work and for individuals to gain access to useful goods and services when they do not have the money to pay for them. It has been claimed that the operation of LETS implies a form of regulation which undermines the fetishism of commodities (Lee, 1996). In a LETS system, it is argued, the money supply is not controlled by a central bank but by the requirements of exchange. Needs and indebtedness drive the system, and equilibrium is achieved through public accountability achieved through the publication of members' balances. Members of LETS schemes are, moreover, involved in direct, face-to-face contact with the individuals with whom they are trading and, therefore, allow individuals to develop an understanding of economy based on immediate and observable cause and effect. This is a highly problematical argument and demonstrates a lack of understanding in respect of the way in which capitalism works.

LETS are based on the immediate satisfaction of wants and needs and there is no potential within LETS for the production of a social surplus in order to support expanded reproduction (Lee, 1996). LETS are thus structurally tied to a wider, surplus-generating system as there is no surplus generated which can be devoted to expanded reproduction. What are these structural and institutional linkages? Whilst the businesses involved in LETS schemes are able to ease cashflow and liquidity problems through the expansion of local markets, the implications for labour may be far less beneficial. The commodification and monetisation of society increases the dependence of individuals on the money-form through the way in which time and money become increasingly interlinked. In the context of the mechanisation of low-skilled labour-intensive work, alongside the commodification of leisure, LETS may thus serve further to exclude individuals on the margins of society (Offe and Heinze, 1992). Why do LETS appear to reproduce the alienation and inequality inherent in the capitalist system with which it forms a social totality? It should be immediately apparent that LETS do not aim to abolish money but to 'remoralise' the content of monetary transactions. As one of the leading national coordinators of the LETS network commented:

The Thatcher years have really taken the humanity out of doing business. So much trading is depersonalized now. You go to the shops and don't talk to anyone. This way you are directly trading your skills and goods, you are individually creating a currency.
(Guardian, 12 March 1994)

The morality is premised on the morality of market exchange: of equal commodity-owners meeting in the moral market and engaging in the exchange of equivalents. Socially necessary labour-time is not abolished, but rather, becomes the touchstone for communitarian integration. The involvement of the local state in LETS mirrors the role of the law in the social regulation of capitalism, maintaining the illusion of equality in the sphere of exchange in order to obscure the inequalities and domination of labour in the sphere of production (Holloway and Picciotto, 1991). In order to understand this point, we need to delve beneath the surface of the money form and explore the value relations underlying the articulation of LETS as a social form.

Value Relations Within The Lets Network

The methodological approach developed by Marx in Capital can be developed in order to analyse the value relations underlying LETS. The approach was outlined by Marx in the 'Introduction' to the Grundrisse in which Marx argued that in order to understand the social relations underlying the fetishised categories of bourgeois society it was necessary to start from the simplest and most abstract determination and to proceed from these simple (abstract) determinations to the analysis of more complex (concrete) forms as a 'rich aggregate of many determinations and relations' (Marx, 1973: 101).

In capitalist society the simplest social form in which the products of labour are recognised is the commodity. Labour takes the form of and is socially realised through the commodity. The commodity is a contradictory social form owing to the way it articulates the contradiction between use-value and exchange-value: that concrete and useful labour is mediated by and only becomes socially realisable through its opposite — abstract labour. The contradictory determination of the commodity determines the alienation of human needs. Needs are met only if there is an effective demand for them in the market (Heller, 1974). The social relations underlying LETS do not diverge from this basic form: LETS exchange taking the form C-M-C (or commodity-LETS unitcommodity). The argument is, however, that whilst LETS exchange may consist of the exchange of commodities it avoids the alienation inherent to the fetishism of commodities. In capitalist society this alienation occurs because social relations between people takes the form of the fetishised relations between things: commodity production results in the 'illusion' by which things are ascribed characteristics originating in the social relations between men. The way in which:

Social relations inevitably took the form of things and could not be expressed except through things. The structure of the commodity economy causes things to play a particular and highly important social role and thus acquire particular social properties.
(Rubin, 1972: 5)

Things come to play a social role owing to the distinctive character of the commodity economy. The management and organisation of production is constituted by independent commodity producers who produce for society rather than for themselves. The universal alienation of the products of these independent producers through exchange or the market results in the development of a unified productive system: the distinctive feature of this system being the way in which the market regulates the production of use-values or things. In the commodity economy, commodities (indirectly) regulate the working activity of people as the direct production of use-values must take into account the expected conditions of the market. The conditions of capitalist reproduction, therefore, define the social character of labour. The working activity of one member of society is affected by the work activity of others only through things. Social relations inevitably take on a reified form: the form in which they both exist and are realised. The 'thing' is an intermediary of social relations, and the circulation of things both expresses and creates production relations among men (Rubin, 1972: 7–13).

We need to assess, therefore, the extent to which production and consumption through LETS escapes the fetishism of commodities. It remains the case that individuals within LETS networks are unable to fulfil their own needs and capacities except through the objectification of their labour on the market. They have to offer some thing which is desired by another commodity owner in order to realise the value of their own commodity. In other words, the social relations underlying LETS is that of exchange-value. Exchange-value emerges as the regulatory form of a commodity producing society through a real process of abstraction. This emerges from the contradictory determination of the commodity: the contradiction between use-value and exchange-value. The labour contained in use-values is of a particular useful and concrete kind, but as exchange-values, determined by labour-time, the qualitative difference between use-values must be eliminated, and the labour that creates exchange-value is constituted by abstract, homogeneous, general labour. The labour contained in exchange-value is specifically social labour — labour for itself: abstract labour — labour that is constantly determined as 'human labour in general' or 'simple' labour by a real social process of abstraction.

In a society of generalised commodity production the production of use-values, the social division of concrete, useful labour, is regulated by the law of value. To what extent, then, do LETS escape the law of value? Individuals within LETS networks produce for exchange rather than to satisfy their own needs directly. In such a case the LETS unit is not a direct embodiment of concrete, useful labour, but it exists as a social form that has been created through a real process of abstraction and thus represents abstract social labour: labour abstracted from the particular use-value through which it was created. The relationship between LETS and the national currency also suggests that LETS production does not entirely escape the abstract dynamic of socially necessary labour time. LETS units are either directly related to the national currency or directly represent the labour-time attributed to the commodity. Either way, commodities can be exchanged only if they produce universal equivalents.

Hence, I have established that the production and exchange of commodities through LETS is a contradictory social process owing to the contradiction between use-value and exchange-value that is inherent the commodity. But capitalism is not simply based on the production and exchange of commodities. Capitalism is a particular form of generalised commodity production premised on the self-expansion of value. LETS is premised on the exchange of equivalents through the circuit C-M-C. The valorisation of capital is premised on the self-expansion of value in the circuit M-C-M'. Clearly, money has a different form and function in these two circuits. In the circuit C-M-C money is a means of exchange and circulation. In the circuit M-C-M' money is the most abstract manifestation of capital. The important point is that money is merely one of the forms in which capital exists. It is, moreover, a form which obscures the inequality and domination of living labour within the capital relation. We are thus left with two problems. First, LETS do not overcome the alienation inherent to the money form. As we shall see in the next section it is impossible to develop community and friendship through money because money is the denial and negation of community and friendship. Second, money exists in many forms and it is important to analyse LETS in the context of all these forms. When LETS are analysed in the context of money as capital, what is evident is that advocates of LETS have greatly overemphasised both the extent to which LETS challenge the global money system and the potential of LETS to overcome the problems of this system.

Lets Be Friends! Money, Love And Friendship

LETS do not escape the contradictions and alienation inherent in the commodity form. This would seem to render problematic one of the central propositions of the LETS philosophy: that LETS strengthen the interpersonal bond between individuals allowing people to forge friendships and mutual respect amongst the individuals with whom they exchange commodities. I shall explore this through the following hypothetical proposition:

I want to explore how I can affirm both my individuality and self-worth and my connectedness and friendship (love) with my fellow LETS-wielding communitarians. I live in south west England, a prosperous region integrated into the global money system through the manufacture and servicing of weapons of mass destruction. I am an electrician and have a useful service (commodity) to offer my fellow scheme members and have time to spare in between my self-employed contracts in the defence industry. There are, in the town in which I live, pockets of poverty caused by the decline of manufacturing and the capitalization of agriculture. By joining the LETS scheme I can offer useful services which fulfil other people's needs whilst simultaneously helping others to escape poverty and thereby help to restore a sense of integration and community. I can also help myself to maximize the commodities that I am able to produce and exchange. So what kind of community is this? What kind of friendship (love) am I extending to my fellow man.

In order to approach the above proposition we need to begin by recognising that LETS exchange is premised on the commodity and that the real value of the commodity lies in exchange-value. In other words, the commodities that I produce and consume through the LETS is mediated by exchange-value. Thus the relationship with fellow LETS members is mediated by a 'thing'; a thing which transforms me from a real, living individual into an abstract caricature of myself. LETS are currencies based on exchange-value and mediate the relationship between members of a scheme. If I alienate this mediating function, I remain active only as a lost, dehumanised creature:

Through this alien mediator man gazes at his will, his activity, his relation to others as a power independent of them and of himself — instead of man himself being the mediator for man. . . . It is obvious that this mediator must be a veritable God since the mediator is the real power over that with which he mediates me. . . . Hence this mediator is the lost, estranged essence of private property, private property alienated and external to itself; it is the alienated mediation of human production with human production, the alienated species activity of man. . . . Thus man separated from this mediator becomes poorer as the mediator becomes richer.
(Marx, 1975a: 260–1; emphasis in the original)

Thus, when I am engaged in exchange I am not engaged in a human relationship, but am engaged in an abstract relationship of private property with private property. Even with LETS, money exists as the abstract form of private property and, consequently, money is the true value of things and the most desirable thing of all. Value can only be expressed through the LETS unit and, therefore, value exists only as money and money robs me of my humanity. The morality of LETS does not extend beyond the morality of money.

This abolition of estrangement, this return of man to himself and thus to other men, is only an illusion. It is a self-estrangement, dehumanization, all the more infamous and extreme because its element is no longer a commodity, metal or paper, but the moral existence, the social existence, the very heart of man, and because under the appearance of mutual rust between men it is really the greatest distrust and a total estrangement.
(Marx, 1975a: 263; emphasis in the original)

Money is perfected through abstraction: the more abstract money is, or the less natural (i.e. organically related) to the commodities mediated by money, the more perfect money becomes. LETS create pure money: money as pure unmediated credit. Whilst interest is not paid on LETS credit, the social relations underlying LETS are nevertheless determined by credit relations. LETS are premised on the creation of free credit and based on trust. But the content of trust is money. Through credit I transform myself into money and I meet the lender/borrower as money. The only recognition between us is the money advanced through credit. As Marx (ibid.: 264) notes, credit is only extended in two situations:

1. A rich man extends credit to a poor man whom he regards as industrious and orderly.

2. Credit facilitates exchange, i.e. it is money raised to a completely ideal (pure) form.

Credit is thus an economic judgment on the morality of man and therefore deeply immoral. It constitutes the evaluation of human life through money. Credit will only be extended to an individual considered worthy of credit. With private property the only morality is the morality of money.

In the credit system man replaces metal or paper as the mediator of exchange. However, he does this not as a man but as the incarnation of capital and interest. . . . Man is himself transformed into money, money is incarnate. Human individuality, human morality, have become both articles of commerce and the material which money inhabits. The substance, the body clothing the spirit of money is not money, paper, but instead it is my personal existence, my flesh and blood, my social worth and status. Credit no longer actualizes money-values in actual money but in human flesh and human hearts.
(Marx, 1975a: 264; emphasis in the original)

Credit reduces my worth to my worth as defined by money. Credit demoralises the poor as they suffer the ignominy and humiliation of having to ask the rich for credit. Moreover, the credit relationship implies that the counterfeiting of money must be carried out on man himself rather than on some other material. The credit relationship is thus defined by deception and exploitation: the basis of trust is mistrust — mutual mistrust and, therefore, hate (not-love). The estrangement of man through money is simultaneously the denial of true human community. A true community cannot emerge when individuals recognise each other only as abstract incarnations of money. Community requires man to recognise herself as man with needs and capacities mediated through self-activity rather than the thing (money). The community of LETS is not an authentic community as recognition is based on the production and consumption of LETS currency units. LETS and the proponents of LETS thus naturalise and take for granted a notion of civil society based on a community of private property owners. LETS traders face each other in a relation of mutual alienation: an alienation which denies the possibility of real community and which reinforces the divisions inherent to the abstract regulation of society through exchange-value:

The reciprocal complementing and exchange of human activity itself appears in the form of: the division of labour. This makes man, as far as is possible, an abstract being, a lathe, etc., and transforms him into a spiritual and physical abortion. The very unity of human labour is regarded only in terms of division because man's social nature is realized only in its antithesis, as estrangement.
(Marx, 1975a: 269; emphasis in the original)

The essence of exchange-value is indifference (brutality). The equivalence between commodities takes on an independent form as money. Money is the unfettered domination of the thing over man: the power of the product over the producer. LETS do not overcome this alienation. As in all production based on private property, man produces only in order to have — having is the aim of production and therefore has a selfish aim. The only reason that I make my abilities as an electrician available within the LETS community is so that I can have the French cottage that belongs to someone else for my summer vacation. My relationship with others remains a relationship mediated by things: correctly wired electrical sockets for a pile of stone and timber in Provence:

I have produced for myself and not for you, just as you have produced for yourself and not for me. . . . Each of us sees in his product only his own objectified self-interest, hence in the product of others the objectification of a different, alien self-interest, independent of oneself.
(ibid.: 274–5; emphasis in the original)

Behind the appearance of mutual supplementation is mutual plundering and deception. This is necessarily the case in a social configuration based on self-interest (self-love): mutuality based on a struggle for superiority. The value which emerges from this mutuality is nothing but the value of our mutual objects: I myself am worthless. LETS do not constitute the unmediated satisfaction of human needs and, therefore, deny both my individuality as a man and my love and affirmation of you:

I would have acted for you as the mediator between you and the species, thus I would be acknowledged by you as the complement of your own being, as an essential part of yourself. I would thus know myself to be confirmed both in your thoughts and your love.
(ibid.: 277; emphasis in the original)

In any system of private property labour is not-life: it is the alienation of life — living death. Whilst it appears as if individuality is confirmed through private property, it is in fact the denial of true individuality and true community. The affective content of LETS is thus the alienated and fetishised self-interest of a micro-community of petty commodity producers. You are my friend and I love you because of what you have rather than what I can give to you. I will not offer my services as an electrician unless I know that I am going to receive something in return. LETS confirm, therefore, the alienation inherent in private property. LETS exist, moreover, in a social totality marked by a particular kind of private property — the generalisation of wage-labour and the command of living labour-power by dead labour — capital (ism).

Lets Abolish Money? The Return Of The 'Time-Chitters'!

The theory of money presented by advocates of LETS is not new, but was propounded in detail by the French utopian socialist Pierre Proudhon and his followers, such as Alfred Darimon, in the nineteenth century. The critique of Proudhon was a critical moment in the development of Marx's Capital (Rosdolsky, 1977: 99). Like his latterday counterparts, for Proudhon, the principal evil of the capitalist order was the privilege of money and the exploitation of labour in the sphere of exchange through the practice of usury. Proudhon argued that the exploitation of labour, and the resulting economic crises, could be resolved by robbing money of its privileges and making all commodities directly exchangeable. The LETS schemes are not directly the same as the schemes advocated by Proudhon, as many of the former schemes reject a time-based formulation in respect of the value of the LETS unit. What they share, however, is a concern to rob money of its privileges and to reduce money to the level of the rabble.

In the Grundrisse Marx undertook a detailed critique of Proudhon and his schemes for abolishing money. Proudhon recognised that in a society with a developed and systematic division of labour, direct barter was impracticable, and that a symbol or token was required in order to facilitate the reciprocal exchange of commodities. Proudhon argued that the value of labour could be represented by paper chits and that this would allow workers themselves to benefit from the increasing efficiency of living labour-power through the constant appreciation of the currency. The advocates of LETS repeat the mistakes of Proudhon in the way in which value and price are conflated and the way in which the necessary antagonism between these two forms is ignored. This distinction was outlined by Marx in the Grundrisse:

The value (real exchange-value) of all commodities (labour included) is determined by their cost of production, in other words, by the labour time required to produce them. Their price is this exchange-value of theirs expressed in money. The replacement of metal money (or of paper or fiat money denominated in metal money) denominated in labour-time would therefore equate the real value (exchange value) with their nominal value, of value and price.
(Marx, 1973: 136–7; emphasis in the original)

As Marx goes on to argue, the value of commodities as determined by labour-time is only their average value. Whilst the average value appears as an abstraction, it is a real abstraction owing to the way in which it exists as the 'driving force' and the 'moving principle' of the oscillations through which commodity prices run in a given period of time. Market value equates itself with real value through a constant non-equation with itself (as the negation of the negation: as the negation of itself as negation of real value). Price is distinguished from value not only as the nominal from the real, but because the latter appears as the law of motion through which the former runs. This has important implications in respect of the time-chits proposed by Proudhon:

The time-chit representing average labour time would never correspond to or be convertible into actual labour time i.e. the amount of labour-time objectified into a commodity would never command a quantity of labour-time equal to itself . . . just as at present every oscillation of market values expresses itself in a rise or fall of the gold or silver prices of commodities.
(ibid.: 139)

The time-chit would thus represent an 'ideal' labour-time which would oscillate above or below the real labour-time. This ideal labour-time would, therefore, become reified and achieve a separate existence of its own within which the time-chit would correspond to the non-equivalence. The result would be alienation because with the time-chit — as with any kind of money — 'the exchange relation establishes itself as a power external to and independent of the producers' (ibid.: 146). Money is both the form and content of general wealth and confronts individual commodities as an alien 'thing' with its own laws, equipped with all the properties which money has at present but unable to perform the same services. The circulation of commodities and the non-equivalence of value and price result in the emergence of money as a separate mode of existence. In this sense the time-chit cannot act as money because:

Price is not equal to value, therefore the value-determining element — labour-time — cannot be the element in which prices are expressed, because labour-time would then have to express itself simultaneously as the determining and the non-determining element, as the equivalent and non-equivalent of itself.
(ibid.: 140)

Proudhon, therefore, made the mistake of equating value and price, and this enabled him to imagine that he had demolished the real differences and contradictions between the two forms. He could then imagine that he had further resolved all the contradictions of capitalism: the money price of the commodity equals the real value; demand equals supply; production equals consumption; money is simultaneously abolished and preserved; and the labour-time embodied in the commodity is directly embodied in the time-chit (Rosdolsky, 1977: 104). In this way all commodities are transformed into money; or, as Marx prosaically put it, 'let the pope remain but make everybody pope' (Marx, 1973: 138).

The fundamental weakness of Proudhon, according to Marx, was his failure to recognise the intimate relationship between commodities and money: the way in which the circulation of commodities inevitably gives rise to the emergence of money, and the impossibility of abolishing money while exchange-value remained the social form of products. These criticism led Marx to pose a question which has direct relevance in respect of LETS schemes:

Can the existing relations of production and the relations of distribution which correspond to them be revolutionized by a change in the instrument of circulation, in the organization of circulation? . . . Can such a transformation of circulation be undertaken without touching the existing relations of production and the social relations which rest on them?
(ibid.: 122)

Clearly, for Marx the social form of circulation rests upon a particular social form of production, and that changes in the form of circulation presuppose a change in the social form of production. The equivalence effected by money is above all the equivalence of social inequality: 'money hides a content which is eminently a content of inequality, a content of exploitation, the relation of exploitation is the content of the monetary equivalent' (Negri, 1991: 26). The tinkering with the instruments of circulation through LETS, therefore, constitutes an attempt to remoralise the demoralised community of money. Money is a relation of inequality: a generic representative of the property relation:

The reciprocal and all-sided dependence of individuals who are indifferent to one another forms their social connection. . . . The power which each individual exercises over the activities of others or over social wealth exists in him as the owner of exchange values, of money. The individual carries his social power, as well as his bond with society, in his pocket.
(Marx, 1973: 157; emphasis in the original)

The usefulness of Marx's account of money in the Grundrisse is that it presents money in the form of a social relation and illustrates the way money represents, organises and sanctions these relations. Marx presents the real world as a world made of money with class struggle constituted by the denunciation and the refusal of money (Negri, 1991: 21–40). It also allows us to assess the claims of the communitarians: that LETS is an example of the way in which the globalising tendencies of (post)modernity open up spaces for the revitalisation of local communities. As Marx noted:

[quote ]Monetary greed, or mania for wealth, necessarily brings with it the decline and fall of the ancient communities (gemeinwesen). Hence it is the antithesis of them. (Money) is itself the community (gemeinwesen) and can tolerate none other standing above it.
(Marx, 1973: 223) [/quote]

In a society dominated by exchange-value money is the community: there is no community outside the community of money. In a society dominated by exchange-value the community is a reification. The form is the contradiction: it is the antagonism which the circulation of money attempts to terminate and resolve. Money does not create the contradictions of capital accumulation, rather it is the development of the contradictions and antitheses which create the seemingly transcendental power of money (Marx, 1973: 146). The problem with Proudhon — and this can be directly levelled against the advocates of LETS — is that his is an attempt to resolve the antagonism within the sphere of circulation, and thereby, further to mystify the exploitation inherent in the money form. The reform of money, particularly the socialisation of money by the state, is thus a deepening of exploitation.

Lets Solve The Crisis?

It is impossible for LETS to overcome the crisis and contradictions of money. The advocates of LETS repeat the mistakes of Proudhon in failing to differentiate between money as a means of circulation and money as capital. This is very important if we are to understand the origins of the current crisis of money (monetarism) and the extent to which initiatives such as LETS are able to provide a challenge/solution to the present crisis. The provision of free credit (as through LETS) would not overcome the crisis as a lack of money is not at the origin of capitalist crisis. In a crisis, commodities (including in particular the labour commodity) remain unsold, not because there is a lack or absence of money but because there is nothing against which they can be exchanged. In other words, the contradictions of money derive not from the form or the existence of money but from the social relations of production mediated by money. In capitalist society, production is related to the generation of surplusvalue rather than to meeting human needs, and there is thus no reason why supply and demand should balance. The lack of demand appears as a shortage of money and confronts producers as the power of money. The contradiction is not, however, created by money: rather, it is the contradiction between use-value and exchange-value that creates the power of money.

So what of the moralisation and democratisation of money advocated by the LETS-wielding modern-day time-chitters? In the context of a prolonged crisis of social capital (Keynesianism), and the recomposition of social capital (monetarism), LETS schemes ameliorate the monetary appearance of the crisis: i.e. no money (as poverty, unemployment, crime, demoralisation). The poverty and demoralisation which appear as an absence of money obscures the content of the crisis — as a crisis and struggle over the extraction of surpluslabour and the realisation of surplus-value. The antagonistic foundations on which money is premised allow money to emerge as a 'social symbol' and as a 'function of command': the 'money subject' determined as both a consequence of the crisis and as a solution. The dialectic is not, however, one of necessary mediation, but one of antagonism, opening and risk: 'the symbol can become subject, value can become command, over-determination can break the dialectic and be in force with power and command' (Negri, 1991: 31).

Money is value; value is money. For Marx, the only route for communism was the destruction of money, the study of money being an important moment in its destruction. Whilst production is premised on exchange-value it is thus impossible to abolish money. This does not mean that the struggle against money is politically irrelevant. As the struggle over the capital relation intensifies it is increasingly directed at money as the most striking and contradictory social form of capital. The problem is that the critique of money must be directed at the social conditions underlying the antagonistic contradictions of money. The crisis of money, therefore, is the crisis of the law of value. Marx uncovered the crisis of social relations which underlies the crisis of money. The limits of the struggle against money are that money is just the perceptible appearance of the contradictory social relations of capital. Furthermore, it is important not to discount the possibility that money has revolutionary potential. However, to focus only on money ignores the way in which the contradictions of money are merely the appearance of the contradictions of the capital relation and that to ignore the capital relation ignores the power of capital to restructure itself in response to the threat of class struggle.