Bartering Is Not Your Usual Trade

By Gabriela Cerioli and IPS Reprint | | Print |

BUENOS AIRES, Apr 6 2009 (IPS) - The exchange of goods and services without involving money rises and falls in Argentina in inverse proportion to national prosperity, and is apparently far from sinking in the stormy waters of the globalized economy.
In May, barter will celebrate 14 years of new life in Argentina. After a peak in this form of trade, following the 2001 economic collapse, today it keeps a lower profile, though it involves tens of thousands of people around the country. Despite its survival, economists question its long-term viability.

In Argentina, there are some 500 “barter clubs” operating, no longer with the three million people who in 2002 sought support in this economic system. But promoters say there are twice as many in the clubs now as there were last year.

“El Club del Trueque” is a space for exchanging clothing, school supplies, homemade food, household repair jobs in carpentry, bricklaying and electrical work, medical and dental services, tutoring and tourism, among other goods and services.

Organizers have seen a 50-percent hike in the number of barterers since 2008, coinciding with the beginning of a feeling of economic uncertainty linked to the conflict between the government and farming unions about higher export taxes.

Because of this expansion, the country's oldest barter club, created May 1, 1995, in Bernal, a southern Buenos Aires suburb, is moving to a bigger space.

“The relaunch will take place in the next few weeks,” announced Rubén Ravera, one of the founders of the Club del Trueque, or Global Barter Network (RGT) in Argentina. “It's recommended that the number of participants at each location is no more than 100, the only way to establish face-to-face relations and reinforcing trust between the members,” he said.

Ravera said it is difficult to measure the volume of trade. But “it's been growing slowly since 1995. The barter agreement is made by phone, e-mail and in person,” he said.

In order for a barter market to function in a “multireciprocal” way, all participants must consume in the same proportion in which they supply goods and services. This is known as “pro-suming”.

“That has an incredible effect on people's self-esteem, especially among the youth and the homemakers, who can place value on abilities that had not been valued before,” Ravera said.

Belén Rodríguez, a woman in her thirties who has never had a formal job, initially prepared food and recycled clothing. “That work with my hands gave me the ability to create crafted items that I exchange for services,” she explained while attending to a hairstylist interested in her items.

Ángela Mariño appreciates “that simple contribution of the people that shows warmth. The pastries aren't always identical, the meat pies have that homemade crust, a sweater with a loose thread. Nothing perfect, but everything is abundant,” she described.

But not everything is so “homemade”. This “pro-sumer” recognizes that what she most gets out of the Club del Trueque is getting to know a group of young people who help her keep her computer updated. People also come to the club as families. Fausto Torres and his family visit once a week. “The result is highly positive,” he said.

“We bring pies, croissants, empanadas, pastries and sweet breads that we trade for an unimaginable range of things, from food and beverages, cleaning supplies, household goods (batteries, flashlights, light bulbs, compact discs), clothing and even eyewear,” Torres said.

But isn't the world now too globalized to return to this primitive form of trade focused on subsistence?

“This system has a future in today's world to the extent that we are seeing with new eyes the attraction of collaborative deals. Barter is not synonymous with subsistence, or with separating from the economy. It is a complement in order to incorporate those who are excluded from the system,” says Horacio Krell, head of the Unión de Permutas de Argentina, an entity that promotes exchange of goods and services.

The return of the barter system would be possible, says Krell, through education, “revaluing a culture of work that promotes a form of capitalism sustained in the real economy and not on financial profits.”

In Ravera's opinion, the inclusive model of the Club del Trueque has “enormous potential for developing the economies of small communities and containing the approaching crisis.”

But the system as unviable in the long term, according to the several economists interviewed for this article. The Ministry of Economy, meanwhile, did not respond to repeated attempts to obtain comment.

The concept of sustainable development has to do with the level of consumption, which is difficult to reduce, said Carlos Leyba, professor at the University of Buenos Aires. “If we stop consuming, the army of unemployed would grow,” he said.

Leyba, who heads the research team at the Strategy Center for the State and Market, believes that analyzing the return of barter belongs in the sphere of philosophy.

“It sounds like a big step backwards, because it happens when currency no longer makes sense. In a world that advances in function of international trade, with multinational corporations that fragment production and manufacture in different countries, physical compensation is impossible without money,” he said.

UBA economist Carlos Melconian, founder and director of M&S Consultores, was categorical in his reply: “Barter has neither a place nor a future.”

Consultant Roberto Cachanosky, graduate of the Argentine Catholic University, agrees. Barter “is a prehistoric mechanism… In the case of an international monetary collapse, any attempt to reestablish it would be temporary, very short-term, and a way out until the monetary system is rebuilt,” he said.

Antonio Brailovsky, economist, historian and university professor, introduced another dimension to the question.

“Barter functioned in Argentina at a time of emergency. But do people accept an economy without money or prefer to be scandalously poor and handle some sort of currency? Managing money is related to identity, and is a very important cultural aspect,” he said.

Because of that, “the idea of barter in an economy of poor people without money is unstable,” believes Brailovsky, former assistant ombudsman for the environment in the city of Buenos Aires.

In contrast to that instability are the microcredit social networks, suggested Brailovsky. Microcredit originated in the Grameen Bank as a long-term approach, a project led by Bangladeshi economist Muhammad Yunus, winner of the 2006 Nobel Peace Prize.

But against all predictions to the contrary, the barter clubs have not disappeared. And the reasons are not always about economics.

Ricardo Jordan has been a pro-sumer for many years. That is how he covers approximately a quarter of his basic needs. Of Scottish descent, he is a skilled artisan, but his current specialty is organic gardening and carpentry.

“When I arrived at the Club del Trueque, I came from losing everything: my job, my self-esteem and my dignity. I was dead,” he said. “But now I have found life again.”