WHY DON’T BUSINESS DOLLARS CIRCULATE LIKE U.S. DOLLARS, BARTER DOLLARS AND LOCAL CURRENCIES?

I have regularly encountered the argument that if they do not circulate, then they cannot really be money. Business Dollars, if they do not circulate, must only be a discount, a coupon, an accounting tool, perhaps, but certainly not money. If they are earned, spent and then taken off the books, the poor merchants who have accepted these Business Dollars have been deprived of the opportunity to invest or spend the currency for themselves.

This is just one more example of thinking that current practices represent all that has ever been and all that will ever be. As has been pointed out earlier, the entire history of money is one of constant evolution and change, based on the needs of the economy and the level of technology at hand. At the dawn of paper currency, there were likely many who argued that, if it isn’t a thing of value, then it shouldn’t be traded and cannot be money.” Maybe gold, silver, cows and chickens were reliable as money, but certainly not worthless little pieces of paper. In the transition from paper currency and checks to electronic banking, the argument could certainly be heard —and for some remains no
doubt still real —that “If you can’t see it and touch it, it can’t be money.” Well, invisible electronicdebits and credits have certainly overtaken paper currency as the “coin of the realm.”

What makes something money is very simple. It must be a reliable tool to increase economic coop-eration and to expand the volume of goods and services produced and distributed? If so, it is a form of money. Even more simply put:

If employees accept it and spend it as consumers…
if businesses redeem it for their products and services…
then it is money.

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