Community means different things to different people. To some people, a community is a place where people live, such as a neighborhood, village, or town. To others, a community is a group of people with something in common that holds them together. To still others, community is the sense of connectedness between people. Whichever way you look at it, our communities are where we turn in times of need, both to offer our help and to seek the help of others. Our communities are also where we learn and work together, where we meet friends, and where we gather to celebrate. In order to make all this possible, we need to build and maintain the relationships that form our community networks. These relationships determine the “community-ness” of a community, and they can be described and measured in terms of social capital.

Social capital is the effectiveness of a community, or of any network of people. It is the connectedness of the network and the strength of the connections. By some definitions, it is also the resources available within the network. Connections and relationships between people depend crucially on the quantity and mutually beneficial quality of time actually spent together, in order to build trust and the norm of reciprocity. We can measure this social capital as time: both the time we spend in creating and sharing opportunities with others to participate in our community, and the time that we invest in turning these opportunities to their beneficial use.

Some people say that time is money, and in a sense, they are right. In order to create value through our work, we must spend our time. However, a major difference between time and money is that you can never buy back time that is already spent. In this sense, time is much more valuable than money. In our culture, we can barely conceive of value without bringing in the concept of money. To make matters worse, we load money with two inconsistent meanings: we say that money measures value, and that money stores value. Therefore, in order to learn the value of something (or of our time), we think we must try to exchange it for money. However, that measures only its value to someone else, and not its intrinsic value. Our willingness to hold money is based upon our expectation that we will receive something of value to us in the future, if only we give something of value to others in the present. It may seem strange that we value such future expectation more than the thing (or our time) that we have presently to offer. What is the real basis for this expectation? Surely the basis is not some colorful pieces of paper that we call money, nor some numbers in a bank account. In reality, this expectation is based on the social capital of our community, and our reputation within the community as people who can be trusted to honor our promises and obligations. To build this social capital and our good reputation requires the investment of our time, and it is in that sense that money really is backed by the value of our time.

We create money whenever we make a promise (and become obligated) to provide something of value in the future. An obligation to a person (e.g., “Thanks for your help; I owe you dinner.”) is a simple example, although technically an obligation is money only if it is transferable and fungible (divisible). An obligation to a peer group (e.g., through a mutual credit system, a time bank, or a barter network) is also a kind of money. These are all forms of “free” money, systems in which enough money is always available to do business, in just the same sense that miles are freely available to measure distance. All money that comes from a bank (either as an account balance or as paper money) is actually debt, and is created through loans. The bank creates money by lending us the power to obligate others to provide value to us when we “spend” the money – although note that this power is not spent, but merely transferred. This power really is an illusion, though, because nobody can be forced to do business with us against their will. If money is a promise and an obligation, then whose promise to provide value does this bank money represent? For the most part, nobody’s promise, because most bank money is created out of thin air, as authorized by the Federal Reserve. In exchange for this illusory power lent to us by the bank, we promise to repay the loan with interest. In other words, we promise to give back all of the loaned power to obligate others (the principal value of the loan), plus a bit more (the value of the interest). In turn, the bank pays some of the interest to the Federal Reserve in exchange for the authority to create new money through loans.

This power to obligate others comes at a great cost to everyone, however. The steady flow of interest payments to the Federal Reserve creates ever-increasing obligation, resulting in the exploitation and depletion of our human, social, and ecological resources. The more interest we must pay, the more scarce become our time and other resources, and so we learn to value highly such scarce resources for their scarcity. In order to pay interest that we cannot afford, we learn at the same time to exploit and depend upon generous people and abundant natural resources as though they had no value at all to anyone but ourselves. This is unhealthy for us, for our communities, for everyone on the planet, and for the planet as a whole. In order to take responsibility for our own health and that of our communities and the planet, we must start to measure and value the abundance, generosity, and effectiveness of the creative contributions of people, communities and ecosystems, and of the renewable resources of the planet. We shirk our responsibility when we measure and value instead the extent of our power to obligate others and to exploit scarce and non-renewable resources. Time is more appropriate than money as a measure of our creative contributions, of our community relationships, and of the renewable resources of the planet. Time is a measure of our (and the planet’s) ability to create and produce, while money is a measure of our power to consume and deplete.

A self-reliant community is healthier than one that depends for its existence upon external resources over which it has no influence, just as a self-reliant person is healthier than one who depends upon others for his survival. Although no person or community is completely independent, we (as people and as communities) must at least take responsibility for our own health. The efforts of a community to build self-reliance tend also to increase its social capital and strengthen its local economy. Wealth and power tend to accumulate in the hands of those who use them most efficiently. However, efficient accumulation of financial capital is typically achieved through exploitation and depletion of human, social, and ecological capital. One consequence of economic efficiency is that money gets sucked out of the local economy, as its financial capital becomes more concentrated and less available to the community as a whole. Money typically leaves the community in the form of profit to large corporations. However, the result is the same when community members invest elsewhere. A second consequence of economic efficiency is that many people find that they must expend inordinate amounts of time and effort on their survival and that of their families. This leaves little or no time to invest in the relationships that keep their communities healthy and strong. In other words, this deficit of time results in depletion of the social capital of the community. This time deficit results also in depletion of human capital, which is the long-term investment of people in their own and their children’s education, training, and other opportunities. A third consequence of economic efficiency is that it depends upon the unsustainable exploitation of natural resources, so that the ecological capital of the bioregion and of the whole planet becomes depleted. Efficiency and dependency are inextricably linked, both for people through the specialization of their skills, and for communities through their reliance upon import and export. We need to think seriously about whether economic efficiency is even a worthwhile goal. A healthy community finds ways to counteract the drain of social capital resulting from economic efficiency, and it takes seriously its responsibility of stewardship: to sustain its human capital and the ecological capital of the region and of the planet. If we take care to trace the path of money through our communities, we can begin to understand the consequences of our choices and priorities, and learn to shift our priorities toward ecologically sustainable activities that strengthen the local economy and build the human and social capital of our communities.

Here is a collection of background material about social capital, time, and money. [click for more]

Individuals self-identify as a community through voluntary association. People living in proximity to each other do not always form a community, while some effective communities are widely dispersed.

People build community through their active participation. This can be through voluntary service, philanthropy & gift, civic service, collaboration, social engagement, trade & commerce, paid & unpaid work, or almost any other creative or productive contribution of time.

Community is connectedness. The links represent social capital created by pairs of individuals connecting through the investment of their time in mutually beneficial relationships.

Home and family time contributes social capital to family members (“a” - “d”) and the community. This includes child-raising, home maintainance, house & garden work, and much more.

Civic service, collaboration and social engagement contribute social capital to the community. This includes time spent with peers, friends and family (“a” - “b”), participation in public forums, local government, service organizations, and most importantly, celebration (“c”)!

A gift between people (“b” and “c”) who participate in overlapping communities (“A” and “B”) contributes to the social capital of each of these communities.

Trade between people (“b” and “c”) contributes to the local economy of the community (“A”) where they conduct their business and to the social capital of the communities (“A” and “B”) in which they participate together.

Nonprofit organizations bring people and resources together to serve their communities. They contribute to the social capital of the communities of those who support (“a”) and serve (“b” – “e”), and of those whom they serve (“f”).

For-profit businesses bring together suppliers and customers (“a,” “f”) with owners and employees (“b” – “e”). Their commerce contributes to the local economy of the community (“A”) where they conduct their business and to the social capital of the communities (“A” and “B”) in which they participate together. Typically, some suppliers and customers (“f”) are not community members; business with them contributes to import and export, instead of the local economy.