Category Archives: Finance

Tenino’s wooden currency

A growing number of communities (Brixton, Totnes, Bristol) now use scrip (a community currency or loyalty programme) as a way to keep business activity local and increase community resilience to economic shocks we look at one of many historical precedents

In 1931, during the depression, the Citizens Bank in the small U.S. town of Tenino, Washington, closed its doors after running completely out of money. As it only had one bank there was no longer any cash currency available for the exchange of goods and services.

The Chamber of Commerce received permission from Congress to begin printing their own money. A committee was formed that included the town’s physician, Dr. Wichman, dentist Dr. Meyer, and Don Major, the publisher of the local newspaper the Thurston County Independent. After a few attempts with paper money, the Chamber decided to make currency out of wood, which was readily available.

Major began printing pieces of temporary currency on thin, 1/80th-of-an-inch-thick pieces of “slicewood,” two strips of spruce, laminated, with a piece of paper in the middle. He started with 25¢ denominations, and later produced somewhat larger amounts, including 50¢ and $1.

A number of other cities and towns across the U.S. ended up printing scrip notes or IOUs on slips of paper. Even after the Depression had finally abated, Tenino’s tradition of wooden money survived. The town continued to print souvenir and commemorative bills, usually annually, to meet the demands of collectors. Word of the wooden money spread quickly, and soon requests from currency collectors across the country poured in.

The Tenino Depot Museum, which now houses the original press, holds a number of “request letters” from people who would write to Tenino to see if they could get their hands on the unique currency. Loren Ackerman has been running the original printing press since the 1990s, when he took it over from the previous caretakers after they grew too old to operate it safely. “Running the press is… how should I put it… not OSHA-approved,” he says. “If you slip at all, you’re going to bite your fingers.” As he fires up the machine, he shares the history of the wooden money.

Recently printed wooden money can be bought at local businesses. Anyone can walk in to a local ‘50s style café, Scotty B’s. and buy wooden money in denominations of $1, $5, or $10, to keep as a souvenir, or spend in town. It can be used at most of the local businesses as legal tender, as intended in 1931.

Ackerman has taught one of his sons to use the press so that the tradition can continue when the time comes.

 

 

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Kenya’s government invests in geothermal energy

Kenya is the first African country to develop geothermal energy. It is  diversifying from hydropower, which currently provides most of Kenya’s electricity, because its capacity has been seriously reduced by the worst drought since the 2011 – and further droughts are anticipated.

Geothermal energy comes from a mixture of water and steam under pressure drawn from nearly 2 km beneath the earth, in Kenya’s Great Rift Valley (above). It is providing reliable, cost-competitive, baseload power with a small carbon footprint.

Only 10% of Kenya’s population has electricity for their homes, so this project will help more people to have a better lifestyle. The energy is going to be used for household needs such as heated water and electricity.

There are concerns about the adverse effects of installing the pipeline infrastructure on vegetation, wildlife and the nomadic way of life

But as an employee of Kenya Electricity Generating Company said: “It is a clean energy, or green, because its carbon footprint on the environment is minimal”.

This is a state conceived and managed achievement – now part of

which focusses on reforms and development across 10 key sectors. 

The state’s role is possibly deplored by the Climate and Development Knowledge Network , an alliance of organisations headed by PricewaterhouseCoopers, a powerful accountancy firm (one of the Big 4) with a chequered history. They conducted a study which found that Kenya has ‘put little focus’ on involving the private sector in risk mitigation – insurance? – and flows of significant private sector finance.

Long may it be so.

 

 

 

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Hawes: as government sheds commitments, ‘we are going to provide for ourselves’

As large-scale cuts in public expenditure began to ‘bite’, the 2010 Conservative manifesto presented the Big Society as its flagship policy, later endorsed by the Conservative–Liberal Democrat coalition. The Big Society Network was formed, owned by The Society Network Foundation charity. It had £2 million from the National Lottery and public-sector grants. However in July 2014, the Charity Commission investigated alleged misuse of funds by the network; it went into administration and was wound up. David Cameron did not use the term in public after 2013 and the phrase ceased to be used in government statements.

Years earlier the people of Hawes in the Yorkshire Dales were realising this vision, because, as John Blackie, a district and county councillor explained: “Here we say (to government), ‘If you aren’t going to provide for us, we are going to provide for ourselves’”.

Necessity has been the mother of invention.

Hawes: 1137 population, 683 dwellings

The Wensleydale line and Hawes railway station had closed in 1959. Then both police houses closed. Last year one of the town’s two banks left, leaving Hawes with a single branch open three days a week. “One of the big issues here is that we are losing young families; if we lose services we lose families,” Mr Blackie said. Four local schools in the Upper Dales are only half full, he added.

In 1992, Dairy Crest, its biggest employer, sold the Wensleydale Creamery, featured in the 1989 Wallace & Gromit film: ‘A Grand Day Out’.

Four of the creamery’s managers and a local businessman bought the enterprise and revived it. More than 200 people now work there and it produces 4,000 tonnes of cheese a year.

Since then the business has gone from strength to strength and a new dairy was built there in 2014.

In 1997, the community opened the Upper Wensleydale Community Partnership, in a place where people could get access to council services and pay rents and rates five days a week. Before this, a council clerk visited Hawes one day each week.

Over the years they began to run their library, post office and police station. The police moved in, using a room in the community centre which moved to a new site in 2005, bringing the library with them and opening it five days a week instead of two. These local services would have shut down if locals hadn’t volunteered to run them ‘on their own terms’. The town has a retained Fire Station, crewed by firefighters who provide on-call cover from home or their place of work.

After years of dwindling bus services the community launched its own Little White Bus in 2011 to meet the trains at Garsdale station seven miles away. Today they have a fleet of 10 minibuses that rely on 53 volunteer drivers and nine part-time staff, ferrying 65,000 passengers a year. They also have a Land Rover to take children from the most remote farms to and from school.

After the village was hit by Post Office cutbacks, the Northern Echo reported in 2014 that the Upper Wensleydale Community Partnership had voted to run a post office at the Community Office, a sorting office in the town’s business park and outreach services in Askrigg and Bainbridge. The move followed the retirement of Hawes postmaster whose departure left residents facing a 17-mile drive to the nearest post office. Councillor Blackie said he would also aim to relaunch post office services in some of the 11 villages where sub-post offices had closed over the past 17 years.

Their latest enterprise (October 2017) is taking a three-year lease of the petrol station which was closing down. They hope to install a 24-hour self-service pump and an electric charging point and – one day – to buy the site, offering community shares. It is the first in the country to be run by its community, (part-time staff and volunteers) not for profit but to save local people from making a 36-mile round trip along narrow roads to the nearest filling station open full time. Hawes is so remote that they qualify for a government rebate of 5p per litre to keep the prices down.

Many readers will wish them well as, next year, the partnership plans to buy two plots of land to build affordable homes for rent in perpetuity . . .

and as the Wensleydale Railway Association plans to rebuild the railway from Northallerton to to join the Settle-Carlisle Railway at Garsdale, re-opening the station in Hawes.

 

 

 

Fair Isle’s community group gains support for extending its renewable energy supply

Fair Isle was bought by the National Trust for Scotland in 1954 from George Waterston, the founder of the bird observatory. It is 24 miles south of Shetland, surrounded by rich fishing waters. Most of the islanders live in the crofts on the southern half of the island (below).

Fair Isle’s fifty-five residents hope to develop the three-mile long island’s infrastructure to sustain and attract more people to live here in the most remote place in the British Isles, inhabited since the Bronze Age. Its distinctive knitwear has a worldwide reputation – see: https://www.pinterest.co.uk/explore/fair-isle-knitting-patterns/

As powerful winds mean that Fair Isle is often plunged into darkness, with blackouts usually striking at the most inopportune moments, a community group, the Fair Isle Electricity Company, is leading plans to install three 60kW wind turbines, a 50kW solar array and battery storage. This scheme will bring round-the-clock electricity to the island and help to bolster its dwindling population.

Existing wind-power will be extended to the north of the three-mile-long island, enabling grid connections to the water treatment works, the airstrip, North Haven harbour and the Fair Isle Bird Observatory, after securing £2.6 million in funding.

  • Earlier this year the company was awarded capital funding of more than £1 million through the Low Carbon Infrastructure Transition Programme (LCITP).
  • Highlands and Islands Enterprise (HIE) agreed to contribute £250,000 to the renewable energy project
  • There was a lottery grant of £600,000.
  • The scheme has received £250,000 from Shetland Islands Council
  • and £245,000 from the National Trust for Scotland (which owns Fair Isle).
  • Scottish Water gave £208,000.
  • The island’s bird observatory donated £100,000.
  • The Fair Isle Electricity Company is contributing £20,000.

The island houses a series of high-technology relay stations (left)  carrying vital TV, radio, telephone and military communication links between Shetland, Orkney and the Scottish mainland.

A Fair Isle resident, David Wheeler, a former meteorologist who worked on the introduction of the original wind power system, said continuity of supply would transform domestic life on Fair Isle. “It’s the little changes to our lives that will make a difference, like the television no longer cutting off when the snooker is on or the washing machine shutting down in the middle of the cycle with the clothes still inside. They’re small issues but they do matter.”

Robert Mitchell, director of the Fair Isle Electricity Company, said the project would bring new employment opportunities to the island and sustain existing jobs. “Having a constant electricity source may help to attract more people. This ambitious project is the first step in ensuring that the community of Fair Isle continues to thrive.”

Sources include:

https://www.thetimes.co.uk/edition/scotland/mood-is-electric-as-long-suffering-islanders-anticipate-24-hour-power-6hc52bgtl

http://www.shetnews.co.uk/news/14946-fair-isle-moves-closer-to-round-the-clock-power

http://www.shetland.org/plan/areas/fair-isle

 

 

 

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Fintech startups – Bethnal Green Ventures: Paul Miller

Our attention has been drawn to  a recent article by Paul Miller, partner at Bethnal Green Ventures.

He recalls that in the midst of the financial turmoil of 2008 BGV decided to try something new. They brought together technologists and engineers with people who worked at the sharp end of social and environmental problems in ‘social innovation camps’.

The fintech startup scene had yet to emerge and whole swathes of society, low-income households, people dependent on care, former prisoners, migrant workers, homeless people, refugees and asylum seekers had been poorly served by traditional financial institutions.

In a report, Access to Financial Services in the UK, the Financial Conduct Authority painted a bleak picture of how well the existing financial services companies are rising to the challenge. Paul says: “Fast forward almost ten years and a lot has changed. Now there is a huge startup scene in the UK and the tech for good community has mushroomed with thousands of people putting their technology skills to use, solving problems in health, education, the environment and democracy”.

The FT reports that Bethnal Green Ventures is another early stage UK investor backing tech innovators addressing social problems.

Since 2012, the company has helped launch more than 90 “tech for good” ventures through a twice-yearly accelerator programme. Funded by Nesta and Nominet Trust — the company’s founding partners — as well as the UK Cabinet Office’s Social Incubator Fund, these three-month programmes offer start-ups a £20,000 investment as well as mentoring in return for 6% equity.

Investments include Dr Doctor’s appointment management service, which claims to save the NHS more than £1.2m a year by reducing the number of patients failing to attend medical appointments, and Open Utility, which plans to allow people to buy excess solar power from their neighbours instead of power stations.

Bethnal Green Ventures holds meetings every few months for nearly 6,000 members, many of them working at banks or advertising agencies, but with an interest in donating their time to social projects at the weekend. Paul Miller, chief executive of Bethnal Green Ventures, says it has so far doubled the estimated market value of its investments.

Paul continues: “At Bethnal Green Ventures we want to invest in these new ventures tackling financial inclusion and income inequality. We’re interested in ideas that could:

  • Enable excluded people to gain access to a bank account in the first place. There are an estimated 1.5 million ‘unbanked’ people in the UK and evidence suggests that some groups of people are more likely to experience difficulties proving their identity and/or their address in order to open an account. There’s no need to change the know your customer rules but new services are needed to help people identify themselves in a way that is realistic in their circumstances.
  • Provide fair access to credit. We’re interested in new business models that help reduce risk (both real and perceived) in lending to groups that have found it hard to get loans in the past.
  • Create high quality financial advice extended to previously excluded groups. The wealthier you are, the more likely you are to be offered financial planning advice, augmenting the assets of those who are already financially secure. There’s an opportunity to provide financial education and advice into new markets at low cost.
  • Provide access to benefits and insurance that are relevant to the modern world of work. With the rise of the gig economy and changing patterns of work people need new ways of protecting themselves for when things go wrong or their circumstances change”.

He ends: “If the fintech sector is to avoid the social pariah fate of the financial services sector following the 2008 crisis, it needs to take creating a positive social impact seriously. It’s not just about ‘doing good’, we believe that it presents a brilliant business opportunity as well”.

Analysis: use of renewable energy technologies saved billions of dollars (2007- 15) because of avoided deaths, fewer sick days and climate-change mitigation

Akshat Rathi* focusses on the debate ‘raging across the world’ about subsidies to the renewable industry. Though the results of a new analysis in Nature Energy are directly applicable to the US, he points out that many rich countries have similar factors at play and are likely to produce similar cost-benefit analyses.

The study, by Dev Millstein of Lawrence Berkeley National Laboratory and his colleagues, finds that the fossil fuels not burnt because of wind and solar energy helped to avoid between 3,000 and 12,700 premature deaths in the US between 2007 and 2015.

They found that the US saved between $35 billion and $220 billion in that period because of avoided deaths, fewer sick days, and climate-change mitigation.

“The monetary value of air quality and climate benefits are about equal or more than state and federal financial support to wind and solar industries,” says Millstein.

Rathi continues: “Creation of a new industry spurs economic growth, creates new jobs, and leads to technology development. There isn’t yet an estimation of what sort of money that brings in, but it’s likely to be a tidy sum. To be sure, the marginal benefits of additional renewable energy production will start to fall in the future. That is, for every new megawatt of renewable energy produced, an equal amount of pollution won’t be avoided, which means the number of lives saved, and monetary benefits generated, will fall. But Millstein thinks that we won’t reach that point for some time—at least in the US”.

 

We add that In 2015, an LSE article referred to an IMF report which quantified the subsidies provided for the fossil fuel industry, finding the UK was to spend £26 billion that year, far more than the subsidies provided for renewables. It would be good to see a similar cost-benefit study for the UK – China and India have already been covered.

One of the biggest criticisms of the renewable-energy industry has been that it is propped up by government subsidies (often disregarding those delivered to the fossil fuel industry). As Rathi adds, there is no doubt that without government help it would have been much harder for the nascent technology to mature.

There has been a financial return on taxpayers’ investment and above all, we repeat, the enormous benefits of avoided deaths, fewer sick days, and climate-change mitigation.

Akshat Rathi is a reporter for Quartz in London. He has previously worked at The Economist and The Conversation. His writing has appeared in Nature, The Guardian and The Hindu. He has a PhD in chemistry from Oxford University and a BTech in chemical engineering from the Institute of Chemical Technology, Mumbai.

 

Read the full article here: https://qz.com/1054992/renewable-subsidies-are-already-paying-for-themselves/?mc_cid=d6d241ad3c&mc_eid=d89c5d2450

 

 

 

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Working for the common good: Ketumile Masire,1925-2017

Emily Langer in the Independent has written an obituary of Ketumile Masire – a statesman who described himself as ‘a farmer who has been drawn into politics’.

A summary with added links and photographs

Masire herded cattle before enrolling in a primary school at 13 and receiving a scholarship to attend a high school in South Africa that trained many leaders of the first government of independent Botswana. When his parents died he supported his siblings, becoming a headmaster. He later earned a Master Farmers Certificate, and having saved enough money to buy a tractor,  became a BBfarmer, using modern agricultural techniques.

Botswana cattle

He served on tribal and regional councils and was a founder and secretary-general of the Botswana Democratic Party, now the country’s leading political party. He once travelled 3,000 miles of the Kalahari desert to attend two dozen meetings over two weeks.

After serving as minister of finance and development planning and Vice President, Ketumile Masire became President of Botswana (1980-1998): roads and schools were built, healthcare improved, access to clean water expanded, farming techniques advanced and life spans extended.

The discovery of diamond reserves had transformed the country’s prospects and Masire continued to use the revenues for the public good after the death of his predecessor Seretse Khama.  He became ‘a model leader in a model nation on a continent where poverty, corruption and violence had crushed the hopes of many for stability and prosperity’. 

After leading Botswana through a drought that persisted for much of the 1980s, he shared the Africa Prize for Leadership awarded by the Hunger Project in recognition of the food distribution efforts that helped the country avoid starvation during the crisis.

Though South Africa was Botswana’s major economic partner, Botswana opposed apartheid. “He had to walk a fine line in a really rough neighbourhood,” said Chester Crocker, a former US assistant secretary of state for African affairs. “He had to get along with everybody, without sacrificing his principles.”

After leaving office, in addition to tending the cattle on his ranch, Masire advised other African leaders and chaired an international panel that investigated the Rwandan genocide of 1994. He made important contributions to peace efforts in Congo and, more recently, Mozambique. He established a foundation which seeks to improve agriculture, governance and children’s health in the region.

He once said: “We have a saying in Botswana: A man is never strong until he says what he believes and gives other men the chance to do the same. I am proud to say without a doubt – we are a strong democracy.” 

A more chequered account of his life is given in Wikipedia.

 

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