Where to Swap Till You Drop

In certain neighborhoods of this bohemian port city, you can get your teeth cleaned, have your hot-water heater fixed or munch on a loaf of homemade bread without spending any money.

All you need are a few “talents.”

That’s the name the Valparaiso bartering club has given to its official “currency,” little beige certificates that resemble the Community Chest cards in a Monopoly game. A club member might pay you 30 talentos if you fix her kitchen faucet. Take those talentos to the Wednesday night bartering fair, and you can trade them for jars of homemade preserves (two talentos each) or some jewelry (five talentos and up).

With money in short supply here and elsewhere across South America, barter (known as trueque in Spanish) is the engine driving a thriving parallel economy in which millions of dollars’ worth of goods and services circulate in a self-perpetuating stream of cashless exchanges.

Bartering clubs such as the one in Valparaiso can also be found in the rural towns of Argentina’s southern region of Patagonia, in the impoverished suburbs of Buenos Aires (which has more than 60 clubs) and in slightly better-off communities in Uruguay and Brazil. In an era of scarcity and social upheaval, South America’s barter fairs are a home-grown remedy for empty cupboards and frustrated shoppers, especially among the poor and the middle class.

“It bothers me that everything in our society revolves around money,” said Christian Palma, explaining why he helped launch Valparaiso’s barter fair two years ago. “We’re trying to reinvent the idea of a marketplace and create new types of social ties.”

Not everyone is pleased by the spread of the clubs, which were founded in the late 1990s but have been adding members at a rapid pace in the turbulent economic climate of the past year. A few observers see in the trueque explosion a sign that the region’s economy is coming apart, even as some merchants feel that they’re being hurt by unfair competition.

In some communities hit hard by unemployment and recession, barter has spread beyond the clubs. The city government of Allen, near the Andes in south-central Argentina, allows residents to pay their municipal taxes by bartering.

“People who are going through hard times, who are unemployed or underemployed, can cover their city debts with goods or services,” said Mirta Diomedi, the municipal finance secretary.

Nine in 10 Allen residents are in default on their city taxes, and the local government is so cash-poor that it recently had its phones cut off. Now backyard mechanics can pay off their taxes by fixing city-owned trucks. A man with a Xerox machine churned out hundreds of copies in lieu of 120 pesos in taxes (about $40).

Argentina is home to the continent’s largest bartering fairs, with about 1million members in a nationwide “Barter Solidarity Network.” Trueque boomed in Argentina after the government partially froze most savings accounts late last year and began declaring intermittent bank holidays that forced most Argentines to empty out their wallets to survive.

“The only miracle the crisis has produced in Argentina is el trueque,” said Exequiel Fernandez, a board member of the barter club in Rio Colorado in Patagonia. “Need has created this,” he said one recent Sunday at the club’s fair.

Argentina’s crisis is only the most extreme case of a continentwide phenomenon that has seen most governments slash budgets and devalue their currencies.

In such a climate, doing business without money has a certain appeal.

“Instead of sitting around, waiting for the crisis to end, a group of people has created this social currency,” said Ivan Cabezas, a university professor in Santiago, the Chilean capital, and a participant in a barter fair there. “Between the members of the [barter] group, there’s a sense of solidarity that is not often felt in our society.”

To others, however, the spread of barter is just another reminder of how grim and desperate times have become, and a sign that Latin America is regressing to its economic childhood.

“Returning to these primitive forms of commerce, which belong to an era in which a common currency didn’t exist or wasn’t trustworthy, is in no way a positive development,” the influential Buenos Aires daily La Nacion offered in a March editorial.

Most barter fairs are organized by neighborhood activists of varying stripes. For them, trueque is, all at once, a grass-roots rebuff to U.S. commercialism, a self-help alternative to charity and government handouts, and a way to rebuild a sense of community.

“The idea is that you have to put something in to get something back,” said Palma of the Valparaiso bartering club.

Palma started the trueque club with 10 other people. Working to build the fair to its current 300 members has been a bit like watching a laboratory on human behavior. He’s been able to see how ideas about merchandise and value shift once people begin shopping not with cash or credit cards, but with talentos, or with baskets of homemade pies.

“When people first come to barter, they’re embarrassed,” he said. In the non-barter world, money equals power and prestige. But at the barter fair, money doesn’t buy anything. Instead, you bring what you don’t need, or whatever skill you might have.

In some of the “purest” barter fairs, not even used goods are acceptable for trading--only the products of one’s own labor can be sold. That sort of ethic presented Palma, an environmental engineer, with a small problem.

“Unfortunately, there’s not much of a demand for my services as an environmental engineer,” he said, matter-of-factly. “So I bake bread instead.”

On fair days, Palma brings a basket of whole-wheat buns to a meeting room at a church here.

About 50 people showed up recently, arranging home-grown herbs, jewelry and other goods on three long tables. There were some old toys, too--the club long ago gave up the restriction on used goods.

Most people work in pairs: a husband manning the sales table, for example, while his wife shops with her talentos.

“The Buzz Lightyear is gone already,” Manolo Sierralta said to a small boy who approached his toy collection. The boy began to cry uncontrollably. His mother tried to calm him down by buying another toy, a small truck that cost a “half talento.”

The talento is printed with an Inca-style drawing of a man holding an ear of corn. All people who join the club get 10 talentos. Membership is free.

In the Argentine town of Rio Colorado, the barter currency is called a credit, or credito.

Fair organizers estimate that about 60,000 creditos are in circulation in Rio Colorado, home to about 15,000 people at the northern fringe of Patagonia. The town has two bartering fairs with 1,000 families as members. Most clubs require membership as a way to enforce rules, including the most common one: Everyone must bring something to sell.

On Sunday afternoons, hundreds of people descend on the site of the largest fair, the main building of the town’s business school. Young mothers pedal in on bikes loaded with homemade cakes. Taxi drivers--many of whom accept creditos for their fares--drop off farmers with crates of apples, grapes and plums.

Young porters--also paid in credits--help the sellers carry their goods to a series of long tables inside. Two tall bulletin boards list all the local service providers who have signed up to offer their labor for barter, including four doctors, about two dozen bricklayers and 40 housecleaners.

“I signed up because I wanted to lend a hand to the community,” said Beatriz Santamaria, an orthodontist. But only a handful of people have called her up to barter. “People take the credits they have and buy only essential things, like food,” she said.

When Mariana Altieri takes to a microphone and announces, “Let the trueque begin,” the aisles between the tables become as crowded as a Macy’s on Christmas Eve. People jostle to line up at the most popular table of all, the one stacked with the loaves of bread.

This week, the bartering club pooled its resources to “buy” 220 pounds of bread from a local baker in exchange for half a ton of firewood the club had acquired in previous trades--the baker used the wood to fire his oven.

Blacksmith Jose Nunez can usually fill his refrigerator and pantry with what he buys at the fair. He earns credits by selling things such as portable barbecues, which he offers at a mixed price of 10 credits and 10 pesos. He has also performed a few jobs outside the fair--installing steel security fences and such--at the same mixed price.

“You can’t buy the steel with credits,” he said. No steel mill he knows of will accept barter. “So I have people pay me cash for the materials and credits for the labor.”

So many goods are being bought and sold at the Rio Colorado fair, it’s begun to generate concern among local merchants, who fear that their struggling businesses will lose even more customers.

“We’ve heard that they’re selling [homemade] sausages and pasta,” said Juan Jose Reiser, head of Rio Colorado’s chamber of commerce. “If a business is forced to comply with certain standards of hygiene, then why shouldn’t these people do the same?”

Such concerns haven’t slowed the growth of the barter fairs, although they have led some Argentine legislators to propose laws to regulate the clubs. In Chile, the government is trying to tax them.

After less than two hours of frenzied shopping by club members, most tables at the Rio Colorado fair are empty. People carry out their purchases in the same baskets and bags they used to bring things to sell.

The buzz of activity stands in contrast to the dramatic decline in the region’s agriculture-based economy. Trees wither inside abandoned apple orchards at the edge of town.

The economic panorama is only slightly less bleak in Buenos Aires. The affluent neighborhood of Palermo hosts a swanky trueque at which antique china might be traded for cuts of prime Argentine beef. Used cars are sometimes sold for creditos, as are time shares in vacation homes.

But there is mostly food and used clothes on offer in the Argentine town of General Conesa, an hour’s drive south of Rio Colorado.

The fair was started by a group of women, all teachers. The public school system in their province is broke, and the women are owed several months’ back pay. They’ve been on strike, off and on, for weeks. One day they decided to organize a barter fair to keep themselves occupied.

As the fair grew--it now has 177 members--so did the need for rules.

“When we first got started, it was more orderly,” said Elena Harismendi, one of the founders. “You didn’t have to yell and be authoritarian with people to keep order.”

Everyone wears an ID badge now. And the club draws numbers to see who gets to shop first.

“Before, you would get people pushing each other to get to the things people wanted to buy the most,” said Liliana Corbellini, another of the group’s founders.

Corbellini sends the credits she earns in General Conesa to her son, a university student in the city of Tandil. He uses the credits to buy food at Tandil’s bartering fair.

“He says that three or four days each week he eats from the credits I send him,” she said.

Later, at her home, she offers a piece of the cake she bought at the fair.

Then some toast covered with marmalade she bought there. And finally a drink from a mate, a steel cup used to drink the tea of the same name.

“I got that at the trueque too,” she said.