Every Currency, including the Work-Standard’s Sociable Currency, must be capable of exhibiting four consistent Functions. Without those key defining characteristics, they are unworthy of being practical in the everyday affairs of any country. These Functions are:

• Medium of Exchange: A Currency is capable of facilitating transactions in the transfer of goods and services from one set of hands to another. It should overcome the need for bartering for goods and services that somebody else lacks or does not have on hand, just as it must enable a Financial Régime to fuel all economic activities within the nation-state.   
• Unit of Account: A Currency measures the Value of any given set of goods and services according to their Price. This enables anyone to compare their Value in relation to the Price whenever the latter depreciates or appreciates over time. It also has to be able to determine the overall health of the economy and the Financial Régime sustaining it.
• Standard of Deferred Payment: A Currency should be considered as being an acceptable form of payment in resolving all Debts. Any unit associated with this Currency is considered “Legal Tender” and thus can be used by anyone for paying off their Debts. This implies that the Currency has an inherent Value independent of its own stated Price.
• Store of Value: A Currency has to be able to preserve its Value, independent of the aforementioned Price at any given point in time. In order for the Value to remain constant, its Price has to also be constant as well. It does not even to have to be Kapital insofar as the Currency in question is capable of maintaining its Value despite deteriorating political, social, and economic conditions.

Those four Functions affect the Currency’s Attributes: Fungibility, Durability, Divisibility, Portability, Cognizability, and even Scarcity.

• Fungibility refers to a Currency being capable of maintaining its Value, even if the Currency takes on different shapes, appearances, and forms.
• Durability is the ability of the Currency to be reusable in more than one transaction. Anyone who has been paid in its units following a transaction must be guaranteed the right to reuse it again at a later date.
• Divisibility determines whether the Currency can be divided into smaller denominated units, which means a banknote has to be worth the same Value in coins.
• Portability affects whether the Currency can be safely transported by someone without too many difficulties related to its size, weight, length, width, or transferability.
• Cognizability refers to whether the Currency can be easily recognized by anyone, no matter who they are, as being a Store of Value, a Standard of Deferred Payment, a Unit of Account, and a Medium of Exchange. The Currency can maintain its Value, considered Legal Tender for paying off debts, can measure the Value of goods and services based on their Prices, and can facilitate transactions by anyone who uses it.
• Scarcity describes whether the Currency is able limit its overall circulation based on a specific attribute. There is only so much gold and silver in exist just as printing too much a debt-backed fiat currency will cause Inflation.

Based on those Functions and Attributes, mainstream economics identified four conceptions of Currency, “Commodity Currency,” “Representative Currency,” “Fiat Currency,” and “Cryptocurrency.” All four correspond to the same four variants of Kapital discussed previously in Section One. As for Sociable Currency, the Work-Standard, it too abides by those four Functions. It has to be capable of operating as a Medium of Exchange, measure the Value of raw materials, goods and services according to their Prices as a Unit of Account, serve as an acceptable Legal Tender, and can sustain itself as a Store of Value. Where Sociable Currency differs is how it exhibits those six aforementioned Attributes.

Generally, Fungibility under the Work-Standard is related to the fact that the Financial Regime issues Sociable Currency as Legal Tender in denominated banknotes and coins. Its Durability, Divisibility and Portability are related to Actual Arbeit backing the Value of this Actual Geld through the economic activities of the Totality. The Totality’s actions as a Nation determine the Value of Arbeit, which in turns determine its Price of Geld and the State enforcing that Price under the rule of law. Actual Arbeit is also capable of being divided into specific Professions, Enterprises, Industries and Economic Sectors due to the Work-Standard’s need for a specialized model of political-economic governance. Arbeit can also be done across international borders if the State decides to conduct Real Trade Agreements (RTAs) with another State. This in turn enables the inevitability of Currencies pegged to the Work-Standard as being Cognizant and thus Scarce. There is a certain degree of Cognizability and Scarcity, except both are related to Arbeit and Geld and the fact that the Work-Standard itself relies on its own Theories of Value and Money.

Note that Zeit (Time) does not determine the Value of any Currencies pegged to the Work-Standard. Rather, it gauges the overall productivity and intensity of all economic activities generating Arbeit within a specific period. There is only so much Zeit within a workweek and even less so within a workday. Also, not all economic activities generate the same amounts of Arbeit and Geld. Certain professions, due to their inherent nature, may contribute more Arbeit but less Geld or less Arbeit but more Geld. This is normal and acceptable under the Work-Standard, so long as its Attrition/Inaction Rate, its peculiar metric for measuring the rate of Currency Depreciation/Appreciation, is able to stay within sustainable levels.   

All of these considerations are demonstrative of why the Work-Standard is an original endeavor. It can therefore be capable of being distinguished from seemingly similar alternative currencies such as Josiah Warren’s Time-Based Currencies, Robert Owen’s Labour Vouchers and Labour Notes, Silvio Gesell’s Freigeld, and even some of the recent derivatives of Cryptocurrencies. The justifications behind why the Work-Standard have rejected them outright instead of borrowing anything from them will be elaborated in future Entries.

Categories: Compendium

Tags: Economics, Finance, Philosophy, Politics, Psychology, Socialist Finance, Third Place, Work-Standard