Opting out of the money economy
It's a quirk of mine that I've always found the idea of opting out of the money economy to be interesting.
I've got a bunch of books on the topic. Books like Possum living: How to live well without a job and with almost no money and How to Survive Without a Salary: Learning How to Live the Conserver Lifestyle.
It's mostly the idea that I find appealing. When I look at the details—the hard trade-offs involved—I find that I come up short of wanting to live that way. But there's a lot to learn from these people, their books, and their lifestyle.
The money economy is the default in the western world, but it's hardly the only economy out there.
Bartering predates money and has never gone completely out of style. It has resurgences now and then, especially during times of inflation and deflation.
In a severe inflation the money becomes worthless, forcing people into a barter economy, but even in a more modest inflation barter becomes attractive—when prices are changing quickly, it's a lot of extra work just to stay informed about what's a fair price. Inflation also produces phantom profits with the attendant taxes due. As far as the IRS is concerned the taxes are still due even if the transaction is by barter, but the barterers are in a much better position to avoid the phantom parts of their profits.
In times of deflation the money has value, it's just that most people don't have any. Again, people fall back on barter as a way to get what they need when they can't just go to the store and buy it.
The gift economy
In the gift economy, instead of exchanging money for goods and services, people just give one another what they need and help one another out.
To someone used to the money economy it sounds preposterous, but in fact almost everyone has experienced a gift economy—their family. Parents give their children what they need to survive. Many families are an almost pure gift economy, with every member of the household contributing to the extent that they can—doing chores and helping out in other ways. Other families begin to monetize that sort of work, but most of them do so as a way to teach younger members about how the money economy works and not because each family member is trying to maximize the economic value of his labor.
Outside the family the gift economy becomes less common, but it still exists in various restricted forms. The classic "barn raising" is a gift economy thing—everybody helps their neighbors out. There's an expectation of general reciprocity to the community as a whole, but no expectation of specific reciprocity to the people who showed up to help. In the more modern context, lots of young people rely on the gift economy for help when they need to move.
The gift economy works well when resources are abundant so that everyone can contribute without seriously depriving themselves. They also work best when everyone knows everyone else and a reputation as being generous or stingy can make a difference in how people view you.
Open-source software is often viewed as a gift economy, as is the creative commons.
If you can produce everything you need, you can opt out of all the economies. Virtually no one is in this situation today, but just a couple hundred years ago it was common for frontier families to be largely self-sufficient: through a mixture of gardening, hunting, fishing, and gathering they produced their own food. They made their house out of local materials. They spun fiber into yarn and wove their own fabric for clothing. They might need to go to the money economy to get specialty items like spinning wheels or cast iron pots, but with a modest amount of capital in the form of such items, they could be self-sufficient (albeit at a fairly low standard of living).
There are plenty of other economic forms. The command economy, where some central authority tells everyone what to produce and how to produce it. (Corporations and armies tend to be command economies internally. Some have mock-market economic structures internally, but even when they go through the motions the command structure is lurking in the background.) In the feudal economy, strong tradition dictated who made what and who got it.
Opting Out in the Modern World
Opting out of the money economy really comes down to a few strategies that are simple to describe however hard they may be to actually do.
Reduce and reuse
If you can get by without something, or you can repurpose something you've already got, then you don't need to buy it.
If you get something from a giant corporation, then you're pretty much stuck paying for it with money. The more of your needs you can satisfy locally, the better your chance of satisfying them in other ways. Your neighbors are much more likely to engage in barter. Your neighbors are much more likely to share the bounty of their garden. Your neighbors are much more likely to let you borrow (or have) things they aren't using.
Anything you can make yourself, you don't need to buy. Garden. Learn a craft. If you can make things that are useful or beautiful, you can give them away or use them for barter.
It's worth noting the similarity between these strategies and those for greener living: reduce, reuse, recycle. Producing locally can be either low-impact or not, depending on what you do, but at least it's up to you and not up to some corporation whose impact on the environment is a dark secret.
There are a few things that absolutely trap you in the money economy; things like debt, taxes, and utilities. They make completely opting out impossible, but they can be managed.
Taxes, at least in the US, are not much of a problem. If you're not in the money economy (i.e. you're earning little or no money), then you won't owe any income taxes and will owe little or nothing in payroll taxes. If you own land, there's no avoiding property taxes.
Avoiding utilities completely can be tough, but living "off the grid" is possible for some people in some situations. Even when that's not possible, the use of utilities can be kept to a minimum, and most utilities are regulated in ways that make basic services available at a fair price for people with low incomes (which people outside the money economy usually are).
Debt is the killer that forces you into the money economy. You really can't opt out while you're in debt, which is just another reason why debt should be avoided.
Opting out for the short term
It used to be quite common for people to opt out of the money economy temporarily.
In the days before student loans were ubiquitous, a new college grad might well have nothing but a new diploma and the clothes on his or her back--but had enormous flexibility. Many authors and artists were able to start their careers by living in the gift economy—sleeping on a friend's couch or staying at someone's vacation home for a few months in the off-season, making do with whatever clothes and tools they already had. That level of generosity was pretty easy to come by, at least for long enough to produce, for example, a first novel.
Now that all but the wealthy graduate with student loans, very few new grads have the choice of trying to make it on their art. (A friend who'll let you live in their RV from Halloween until Arbor Day is a lot more common than one who'll make your student loan payments for six months.) They have no choice but to enter the money economy long enough to pay off their debt. By the time that's done, they usually have spouses, kids, a work history that would lose substantial value if they put it aside for a year or two. They're trapped in the money economy.
It makes me mad every time I think about the great art and literature that our student loan system has cost our society.
Opting out for the long term
Now we finally come back to those books that I mentioned at the beginning. If opting out of the money economy appeals to you, track down those books and others like them.
Opting out for the short term is pretty easy, if you have no debt and you already own the basic goods of a functioning household. Opting out for the long term is much harder. It's not what I want to do, and it's probably not the right choice for most people. But bits and pieces of the strategies that work for opting out of the money economy can make it much easier to live well on small budget.
If you know you can get by with little or no money, then you have the flexibility to follow your own path, to take risks, to refuse to knuckle under to people who don't have your interests at heart. That's why it has always fascinated me.
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