Scenario Three:  Overview

Businesses are or can be a force for change. If you wish to create social change business is the most effective way to go. What deters many of us is that we assume businesses are difficult to set up - in this system of things this is generally true. Yet, we are also more involed in business than we realize. What seperates our everyday buying and selling from the same activity does as a business is the formality of the accounting.

Scenario Three:  Example One

Jack hears about the Exchanges program and decides it might help him earn extra income. He provides a link to the Rational Exchange web site and talks to several friends. One Saturday they meet and discuss what it would take to set up a business using the Exchange program.

They have a couple of pick-up trucks between them, plenty of tools and experience in several trades. It seems natural to start doing odd jobs. They decide the business will pay them $15.00 an hour for any work done. The rest will remain in the business and be allocated later. They also plan on setting up an Exchange in which case members can pay for work done using rollars.

The two trucks are rented to the business at r25.00 per hour with a levy of r.25 a mile. The group also create a rental schedule for power tool use but decide not to charge or pay for the use of hand tools. All tools are rented from and to the Exchange.

Stan was thinking of having his roof done and hoped his buddies would help. He decides this would be a good opportunity to get the Exchange up and running by hving his roof reshingled.

The shingles are priced out at $3060.00 and the men think it will probably take 8-10 hours to do the job. Delivery has been included in the price but they will need to rent a roofing nailer from Brad and purchase another since it does not seem beneficial to rent a tool from a rental supply when it will probably be needed for future jobs.

Stan pays the commercial supplier for the shingles and delivery. Anthony buys the roofing nailer and the other tools are provided by the men. Five men work for ten hours plus Stan. The nailers are rented from the two owners for r30.00 for the day. Wages come to r150.00 each man.

Stan gradually works these credits off by helping his friends and partners with jobs around their homes and at other jobs the group does for others.

Scenario Three:  Example Two

As we noted above business is exemplified by the formality of its accounting. A family is not thought a business because while goods and services are traded within a family the trading is informal and very little accouting is done. However it is worth noting that this does not mean no accounting happens. Allowances are paid on the expectations that certain services will be performed by the children. The wife is often expected to perform certain roles and the husband other tasks.These activities are not given any specific value but are done with th expectation that each person will do what is expected of them.

The Robinson family decides to go fishing. Dad tells Tommy to get the rods and other equipment. Sally makes some sandwiches and drinks while mom gets the picnic cutlery and plates, seasons some meat (just in case) and gets out the bar-b-que. Meanwhile dad has gassed up the car and checked it over, hooked up the boat and together they load the car and go.

The family has just created a fishing business out of the skills and equity that already existed within the family. They could have paid each person for the work that was done. However the family is primarily financed by the parents and so accounting would not make sense within the structure of a family.

 Robinsons have an exceptional day and come home with the legal limit. They see their neighbors and offer them a share of the catch. The Smiths are delighted and make the comment that they will be going to pick rasberries in a week or two when the seasons hits full swing. Jack thinks this is excellent and mentions that he and his family will probably go fishing again and will bring them back a few more fish if their luck holds. The Smiths say they prefer to pick seasonal vegetables and fruits at the local farm. A discussion now starts up about how much fruits and vegetables should be picked for how much fish.

John has an idea, he weighs the fish and prices them at $5.00 a pound. He says he will pick $30.00 worth of rasberries in return for the fish. Jack tells John this is far too many rasberries for his family so pick only an additional $10.00 worth and apply the balance to asparagus, or whatever is in season.

In a business sense the Robinsons have become fishermen and the Smiths produce vendors. They have to their mutual benefit become more specialized in the way the contribute to society and their own economic well-being. The exchanges are tracked or given substance by the use of a conceptual currency. THe value of what each person does is denominated in dollars that have no real existence except as numerical values. But it provides a scale by which each person can determine their own and others position.

 

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