Chapter 1 – How Can I Help Others with Bitcoin?What’s the Point of Bitcoin?  Why Support Bitcoin?

• Duty to help to the neediest in the world; the citizens of untrustworthy national governments & currencies.
• Responsibility to participate in curbing inflation.
• Privilege of being citizens of the USA world reserve currency.
• Honor to others; the billions of unbanked individuals.

Example 1: African Farmer Monetary Practices aka the Unbanked and Those Without a Reliable Currency

Example 2: Cost of Remittances to Latin America & Loss of Value in Monetary Transfers

Example 3: US Rural and Inner City Workers’ Standard of Living Falls Due To Monetary Inflation

Historical Context

• Pre-colonial era: African farmers in various regions, such as West Africa, practiced traditional monetary systems, including bartering, commodity-based currencies (e.g., cowry shells), and local currencies (e.g., gold dust).
• Colonial era: European powers imposed their own monetary systems, often replacing traditional currencies with coins and paper money. This led to a disruption of local economic systems and the suppression of traditional practices.

Post-Colonial Era

• Many African countries inherited colonial monetary systems, with a focus on cash crops and export-oriented agriculture.
• The International Monetary Fund (IMF) and World Bank implemented Structural Adjustment Programs (SAPs) in the 1980s, which emphasized market liberalization, privatization, and export-oriented growth. This led to:
  • Reductions in government subsidies and support for small-scale farmers.
  • Increased reliance on commercial markets and cash-based transactions.
  • Limited access to credit and financial services for small-scale farmers.
• In response, many African farmers turned to informal markets and alternative economic practices, such as:
  • Bartering and commodity-based exchange.
  • Use of local currencies and alternative forms of money (e.g., mobile money).
  • Cooperative and collective farming arrangements.

Examples and Case Studies

• In West Africa, the use of cowry shells as a currency persisted in some areas, particularly in Ghana and Côte d’Ivoire.
• In East Africa, the Maasai people in Tanzania and Kenya continued to use a system of cattle-based exchange and gift-giving.
• In Southern Africa, the Basotho people in Lesotho and South Africa maintained a system of cattle-based wealth and exchange.

Challenges and Opportunities

• The persistence of traditional monetary practices and informal economies reflects the ongoing importance of local economic systems and the need for more inclusive and context-specific approaches to economic development.
• The increasing use of mobile money and digital payments in Africa presents opportunities for greater financial inclusion and access to formal financial services for small-scale farmers.
• However, the dominance of global commodity markets and the continued influence of colonial-era monetary systems also pose challenges to African farmers’ economic autonomy and resilience.

Recommendations

• Recognize and support the diversity of African farmer monetary practices and local economic systems.
• Implement policies and programs that promote financial inclusion and access to formal financial services for small-scale farmers.
• Encourage the development of alternative and complementary currencies, as well as digital payment systems, that are tailored to local contexts and needs.
• Foster greater cooperation and coordination between governments, international organizations, and local stakeholders to promote sustainable and equitable agricultural development in Africa.

• High Transaction Costs- Remittance fees can be exorbitant, ranging from 5% to 15% of the transaction amount. This translates to significant losses for families receiving these transfers. For example, a $100 remittance could be reduced to as little as $85 due to fees.
• Informal Channels – A significant portion of remittances flows through informal channels, such as money changers and street vendors, rather than formal banking systems. This lack of transparency and regulation increases the risk of fraud, theft, and money laundering.
• Currency Fluctuations – Remittance recipients often face significant losses due to currency fluctuations. When the recipient’s currency depreciates against the sending currency, the value of the remittance decreases.
• Limited Access to Banking – Many migrants, particularly those in low-skilled or informal jobs, lack access to formal banking services. This makes it difficult for them to open accounts, receive remittances, and manage their finances effectively.
• Brain Drain – The departure of skilled workers for better opportunities abroad can lead to a brain drain, depriving their home countries of valuable human capital. This can have long-term consequences for economic development and growth.
• Economic Dependence – Over-reliance on remittances can hinder economic development in the sending countries. When a significant portion of a country’s income comes from abroad, it can create economic instability and reduce incentives for domestic investment and entrepreneurship.
• Social and Family Impacts – Remittances can also have social and family implications. For example, prolonged separation from family members can lead to social isolation, cultural erosion, and emotional distress.

By acknowledging and addressing these challenges, South and Central American countries can work towards creating more sustainable and equitable remittance systems that benefit both migrants and their families.

The standard of living for rural hourly workers in the United States has faced significant challenges, particularly in recent decades. Here are some key points regarding the situation:

• Wage Stagnation: Hourly wages for middle-wage workers have been stagnant over the past few decades, rising only 6% from 1979 to 2013, which is less than 0.2% per year. Low-wage workers have fared even worse, with their wages falling by 5% over the same period.
• Productivity and Pay Disparity: Productivity has grown significantly, but the pay for the majority of workers has not kept pace. From 1973 to 2013, hourly compensation for a typical worker rose just 9%, while productivity increased by 74%.
• Employment and Unemployment: Rural areas have experienced uneven impacts of economic recessions and recoveries. During the Great Recession and the subsequent pandemic, nonmetro employment levels fell to 92% of their 2007 levels, reflecting slower recovery compared to urban areas.
• Labor Force Participation: Labor force participation rates decreased more significantly in nonmetro areas compared to metro areas from 2007 to 2019, reflecting the slower recovery in rural areas after the Great Recession.

These factors contribute to a declining standard of living for rural hourly workers, with wage stagnation and disparities in productivity growth being key issues.