In an economy where not even a bank can assure you of more than about a 4 per cent return on your money, this city sports a surefire scheme called the Toronto Dollar that absolutely guarantees an immediate 10 per cent increase on every buck invested.
Though fly-by-night scams are rampant on the Web these days, this operation has been going for six years. It's being run right out in the open at the St. Lawrence Market, where I'm told a local cadre are literally printing their own money - even using the same printing company as the feds!
Folks like me who ought to know better have been resisting the allure of this protection racket for far too long. Finally, when I hear that institutions like the Royal Bank and CIBC are getting in on the deal - the Toronto Street branch of the CIBC celebrates the Toronto Dollar time today (Thursday, October 14) - I decide to get enmeshed in the give-something-for-nothing plot myself.
I head down to my local Royal Bank at Gerrard Square, approach a teller and exchange a sawbuck for 10 Toronto Dollars. They look kind of bogus to me, and I'm expecting a lot of resistance. What business in its right mind is going to take fake cash?
Well, surprise, the cashier at McDonald's takes the bills without a second glance and serves me up some french fries. Off I go to the Price Chopper, where the paper script turns into broccoli and fruit, and then to the coffee shop, where it earns me some hot java. At the end of it all, I score 10 bucks' worth of merchandise - and leave one behind. It's that one buck, the by-product of all Toronto Dollar exchanges, that makes my transaction part of the worldwide community currency conspiracy.
The immediate effect is the same as with other alternate cash systems such as the Ithaca Hour in the U.S., the Sel in France, RGT in Argentina and Tlalocs in Mexico: localization. The wealth of the community is kept and refocused locally, where it can be spent and re-spent. It's how alt currencies have worked ever since Gandhi first proposed that a hank of cotton be a unit of currency in 1930s rural India.
The unique thing about the Toronto Dollar, though, is the extra 10 per cent payoff. When the 200-plus participating vendors - in the St. Lawrence Market, Gerrard Square - trade their ersatz dough back in for "regular" money, they only get 90 cents on the dollar. The remainder is siphoned off into the Toronto Dollar Community Fund.
One of the scheme's masterminds, Joy Kogawa, author of the classic novel Obasan, tells me that during the past six years this fund has bestowed $250,000 on a long list of local beneficiaries, including shelters for the homeless, assistance for the mentally ill and breakfast programs for hungry children.
But why would local vendors want to give up that 10 per cent? Seems it might be the cost of goodwill and astute branding. "Getting involved with the community is good business," says Beverly Relph, who manages Gerrard Square for the Davpart Corporation.
Elisa Tenche, branch manager of the Toronto Street CIBC, says the corp "believes in giving back to communities in which we live and work. We will continue to work with organizers to see how to make the project as successful as possible." And Jorge Carvalho, who oversees the St. Lawrence Market, sees it similarly. "We did $90,000 worth of Toronto Dollar business last year," he tells me, almost rubbing his hands with glee. "Customers love it, and we benefit."
So much so that both the St. Lawrence Market and Gerrard Square pay the 10 per cent out of an advertising fund. Of course, if the vendors prefer, they can re-spend their Toronto Dollars for a full dollar's value. This could mean buying their groceries from other local vendors or even hiring someone on welfare to work for Toronto Dollars.
The advantage here is that Toronto Dollars aren't clawed back from a welfare cheque. Instead, they're an opportunity for those on financial assistance to get ahead - to put more food on the table or save up for birthdays, winter boots or dentistry. This feature has been so successful that the St. John's Bakery in Gerrard Square pays its employees entirely in Toronto Dollars.
Still, the idea is taking its royal time to spread. The org has hired two new staffers, paid for by the city, for a new blitz. It's badly needed, obviously, because six years after the Dollar's intro, the experiment's still very localized. Talks with Cloverdale Mall and the Big Carrot have been stalled for quite a while now. It's a major commitment to give up a fixed proportion of revenue; some businesses don't even want to shell out 2 to 3 per cent for Visa, never mind 10 per cent. And stores not represented by strong BIAs with ad budgets would have a hard time signing up on their own.
Another weak link is the process of exchanging the bucks, which has mostly been dependent on volunteer labour at Toronto Dollar booths in the St. Lawrence Market. The ATM machine that dispensed Dollars at the Market has recently fallen into disrepair.
If they could get a flotilla of ATM machines or a Toronto Dollar option on all local bank machines, think about the prospects. But then, maybe banks won't show such goodwill toward this experiment in bypassing the world fiscal system if we suddenly start buying mortgages and earning wages through their homegrown monetary competitor. Now that would be a real economy.