Money better spent

Wandering around town, it’s easy to see that Portlanders have P-town pride. Bumper stickers with “Stumptown” and T-shirts with “Keep Portland Weird” litter the cars and bodies of locals. But there’s another type of local pride being pushed these days that goes deeper into your pockets than the cost of a T-shirt. A group called PDX Currency has taken local pride to a ridiculous level by trying to promote a Portland-only currency.

The goal of this movement is to make sure that locals are promoting local business. The hope is that by having PDX-only credit unions, people will exchange their dollars for money that can only be used in Portland, therefore helping the local economy.

Unlike Ithaca, NY, which recently established a local currency, PDX Currency plans on making a debit card system that would debit local money only. But this idea would never work for Portland.

To begin with, Portland is a metropolis, small as it might be, and has way too many suburbs to try to restrict it’s currency to just Portland. Of course, businesses, should they choose to accept it, could still accept dollars as well. The issue is that if people from Beaverton work and shop in Portland, there would be no incentive for them to get this PDX currency, because they don’t reside here. Likewise, people who live in Portland may shop in Tigard, where the PDX currency would not be accepted. People who travel frequently outside of Portland would also have no use for the currency, except for the few dollars they may spend for basic groceries.

The second major issue is online ordering. We live in the Internet age, when most major purchases are easier to make online. The web will still only use dollars, so anyone who does a lot of Internet shopping would also have no use for a PDX currency.

The biggest part of this that seems to doom the plan to failure is the incentive for businesses. What use would a local business have for this currency? Portland gets its share of tourists, who wouldn’t be able to get or make use of a local-issued debit card. Not to mention that many small stores get mostly tourist shoppers, like many of the boutiques on NW 23rd. Many people whom rent apartments around there may not be able to afford to shop in those specialty boutiques, but they still thrive because of tourism. Those stores would have no need to try to convert to the PDX Currency. Businesses would also have to update all of their credit card machines in order to accept a different type of card, which would add up to a lot of time and money.

The idea is to keep local money local, in order to help local economy–which is a good thing. Buying local is wonderful. Farmers’ markets are guaranteed to sell delicious fresh produce and I would love to support them, but the growers don’t grow inside of Portland proper, so would they even get on board with this plot?

One advantage of a local currency is that small amounts of currency circulate more rapidly, which makes a higher circulation rate per unit. If it weren’t based off of the dollar, a local currency might wind up with a lower inflation rate due to the lack of excess money circulating around. Sadly, the PDX currency is still based off of the dollar, due to IRS reasons as well as to avoid ripping off businesses that accept it.

While promoting local businesses will help small businesses thrive, a local currency seems more trouble and time than it’s worth. My biggest wonder is who are these people that make up the PDX Currency group? Are they willing to spend free time to develop, control and maintain a complex card-only currency system? And the biggest question of all: how do we know that these people are even remotely qualified to convert and design a currency system?

Supporting local businesses can help the local economy. Creating an independent currency from scratch, however, is a great waste of time and energy that could be better spent.