Commentary
This past weekend, we hosted the Exit & Build festival at Sovereignty Ranch, a gathering of people interested in building alternatives to the systems we have become dependent on. One of the companies represented at the event was Goldback, a privately owned company producing a form of currency that contains actual gold.
At our farm-to-table restaurant, The Barn, we have been listed on the Goldback website as a business willing to accept Goldbacks for some time. Before this weekend, I think we had received maybe $100 in Goldbacks and Silverbacks combined.
Then, over the course of the festival, multiple customers paid for their food using Goldbacks. By the end of the weekend, we had accepted close to $2,000 worth of them.
Now, I have a stack of beautiful gold notes sitting in front of me, and I have been thinking about what it takes for an alternative currency to actually work.
Goldbacks are an interesting concept. Each note contains a measurable amount of 24-karat gold embedded in a thin, flexible material. Instead of a piece of paper backed by the authority of a government, you have a piece of currency that contains something physically valuable.
As a farmer, I appreciate that. I spend my life growing things, raising animals, and producing tangible goods. The idea of money that contains something real makes sense to me.
One of the criticisms of Goldbacks is that the actual gold inside them is worth considerably less than their exchange value. Depending on the gold price and the rate at which the notes circulate, the gold content can account for roughly half their exchange value.
But I think that argument misses something fundamental about money.
What is a dollar bill actually worth? The paper itself is worth almost nothing. We agree that it has value, and because nearly everyone else agrees, we can use it to purchase food, fuel, housing, and everything else we need. Its purchasing power also changes over time, generally declining as prices rise.
The gold inside a Goldback gives it a value independent of anyone’s willingness to accept it as currency. But its value as money, beyond the gold itself, depends on whether people are willing to exchange goods and services for it.
And that brings us to adoption.
The other day, my children were watching the Tuttle Twins cartoon, and Goldbacks came up in the episode. Mike Adams frequently promotes them. At the festival, I spoke with someone who told me they could go to their local farmers market and purchase everything they needed for the week using Goldbacks.
That is an interesting picture of what an alternative economy could look like.
Imagine a farmer selling vegetables for Goldbacks, then using those same Goldbacks to pay a mechanic, who uses them to purchase meat from a rancher. The currency circulates, people exchange real goods and services, and nobody needs to run the transaction through a bank.
Of course, the same exchange could happen using cash. The difference is that Goldbacks contain a fixed quantity of gold, while the purchasing power of a dollar changes with inflation and monetary policy. Gold’s purchasing power can also fluctuate, but the amount of gold in each note does not.
I looked at the Goldback website and found 19 other merchants in my area willing to accept them. They range from gun stores to plumbers to gardeners.
That is a small but interesting foundation for a local economy.
The question is whether those businesses actually use them.
We have been willing to accept Goldbacks for quite some time, but until this weekend, we had hardly received any. A business can put its name on a merchant directory, but that doesn’t mean the currency is circulating.
I also recognize that Goldback is a private company. There is a business behind the notes, with manufacturing costs, distribution, and a published exchange rate. It is not some completely decentralized monetary system.
But the gold is physically in the hands of the people holding the notes. Once those notes are circulating, people can exchange them without asking the company for permission.
And ultimately, that is where the power of the idea lies.
This weekend, I gave some of the Goldbacks we received to our employees as part of their tips. That was a small step toward circulation. Instead of sitting in our cash drawer, some of that currency went home with the people who helped prepare and serve the food.
Now, my husband and I are going to take a drive to one of the local gun stores listed as accepting Goldbacks. We want to see whether we can purchase firearms or ammunition using the currency we received at the restaurant.
Not because we need to prove that Goldbacks are perfect, but because we want to participate in the experiment.
If I accept Goldbacks from a customer but refuse to spend them, I am not doing much to help create an alternative economy. I am simply accumulating gold notes and waiting for someone else to give them value.
If I spend them with another local business, and that business spends them with someone else, something different begins to happen.
The same is true of local food systems. People say they want independent farms, small butcher shops, local dairies, and regional food production. But those systems cannot survive on philosophical support alone. People have to actually buy the food.
You cannot build a local food economy by talking about the importance of local farms while purchasing everything from a national grocery chain.
And you cannot build an alternative currency by collecting it and hoping somebody else will use it.
All good ideas require adoption. They require people to take action, accept some inconvenience, and participate in creating the world they say they want.
I don’t know whether Goldbacks will ever become a widely accepted form of currency. I don’t know whether the 19 businesses listed near me are actively exchanging them or whether, like our restaurant until this weekend, they have simply agreed to accept them if someone offers.
But I intend to find out.
The most important question isn’t whether Goldbacks will succeed. It’s whether the people who believe in alternative systems are actually willing to use them.
Because monetary independence, like food independence, isn’t something we can simply purchase.
It’s something we have to build together.
Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.
