Das Wörgl Experiment/en

A PROVEN SOLUTION - DESTROYED BY THE SYSTEM

by Viky Charalambous from the Greek cooperation

SUMMARY:

In 1932, during the Great Depression, the small Austrian town of Wörgl (4,500 inhabitants) faced 30 % unemployment and severe poverty. The newly elected mayor, Michael Untergüggenberger -a self-educated former railway worker - refused to raise taxes, which would have worsened the crisis

Instead, he applied the monetary theory of Silvio Gesell: money must circulate, not be hoarded.

What he did:

• The municipality printed 32,000 schillings in the form of "Labour Certificates" -local currency backed by work performed for the community.
• Crucially: each month, the notes lost 1% of their value. To avoid the loss, people had to spend them quickly -or buy a stamp (1% of value) and stick it on the note to keep it valid.
• This created negative interest -the opposite of usury. It incentivised circulation instead of hoarding.

The results (within 13 months):

• Full employment -not just in Wörgl, but also in surrounding villages.
• All public works completed: water supply, roads, lighting, public buildings, a bridge, a ski track, reforestation.
• No inflation -prices remained stable.
• The local economy expanded dramatically. Workers from nearby villages came to Wörgl, spreading prosperity.
• Over 170 Austrian towns expressed interest in adopting the system.

THE END:

• The Austrian Central Bank panicked -fearing competition to its monopoly.
• The government banned the issuance of "emergency currency", and the Supreme Court upheld the Central Bank's monopoly.
• It became acriminal offence to issue local money..
• Wörgl quickly returned to 30 % unemployment.
• Social unrest followed. Hitler's annexation of Austria in 1938 was partly fuelled by public despair.

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KEY ARGUMENT -WHY THIS MATTERS:

"The Wörgl experiment proves that the solution to economic crisis is not complicated. It is not about more debt, more austerity, more taxes. It is about putting money back into circulation -money that serves the people, not the banks.

But the Central Bank system cannot allow this -because it threatens their monopoly, their control, their usury. So they banned it. They criminalised it. And they condemned the people back to poverty.

This is the same pattern we see today in Greece -the same system, the same obstruction, the same silence."

• Wörgl, 1932: 30% unemployment → full employment in 13 months
• No inflation — stable prices, real growth
• Central Bank banned it — criminalised local currency
• Same pattern: system protects monopoly, not people
• A proven solution — destroyed by the banking cartel