Japan is Using Local Currency

Previously, Robert Fishman wrote:

I'm using this mailing list attached to a recent e-mail from Tom Greco to let you all know that on page 6 of the New York Times of March 14th there is an article on Japan using "Coupons". Actually this reads as though its an experiment with local currency as a way to stimulate the economy. The writer, Sheryl WuDunn from Tokyo apparently does not know of the local currency movement and therefore quotes someone as saying "This is the first such economic experiment done anywhere in the world. "Perhaps someone with more skills in e-mail can find Ms. WuDunn as well as Katsuyuki Hikasa and inform them of others using such local currency for economic stimulus reasons. I, and I hope others, will write to the NY Times and let them know of the other uses going on -including our Equal Dollars system in Philadelphia.

To Which Stephen DeMeulenaere responded:

Dear Robert,

Thanks for your message. The 'shopping voucher' program in Japan corresponds more closely with Social Credit than with local currency. The Japanese government has borrowed 700 million US dollars to back these vouchers, which analysts predict will result in a GDP increase of 0.5%. Even for social credit, the program is deeply flawed and won't accomplish the intended goal of increasing consumer spending.

I'm currently living in Japan's northern island of Hokkaido, where many households will begin receiving their 'shopping vouchers' this week. There are no methods for increasing consumer spending, such as by limiting the use of vouchers to 25% of a purchase, with the remaining 75% in yen. The traditionally thrifty Japanese will simply spend these vouchers on 100% voucher purchases and keep their money in the bank. At least they can only spend the vouchers locally--each municipal issuing agency has designed its own notes. However in some small towns without stores, the vouchers are allowed at some pinball gambling parlours, neighbourhood pubs, and red-light districts as well as in neighbouring towns. Samples will be visible on my website at http://www.appropriate-economics.org/gallery.html once the site is back up.

Despite efforts by a number of researchers and research organizations, including the Japan Research Institute, a major society-economy-technology think tank in Tokyo (whom I was consulting) to properly research and advise on the implementation of the 'shopping voucher' program, the program's proponents, a Buddhist-sect political party (komei-to) pushed the program through government before it could be adequately considered. It's no wonder the Japanese are unaware of other efforts, and why there is near-universal opposition to the program in Japan, even by those receiving nearly the equivalent of $200 US dollars in government handouts.

While I think it's notable that local currencies are being used in the richest country in the world to prop up its failing economy, I think the program will be of zero effect and will result in a massive budget deficit. In short, the program will be a complete failure.


Stephen DeMeulenaere
Tianguis Tlaloc local currency research project,
Community Currencies in Asia, Africa & Latin America