Beyond the U.S. Dollar: Monetary Sovereignty
A primary research focus of the Vermont Institute of Separatist Thought is the design of a post-secession economy. A fundamental question is currency. Options analyzed include retaining the U.S. dollar informally (dollarization), creating a new Vermont currency (the 'Greenback' or 'Maple') pegged to a basket of commodities and currencies, or participating in a regional monetary union. The Institute tends to advocate for a sovereign currency, arguing it would allow Vermont to pursue monetary policy tailored to its small, sustainable economy—such as low-interest loans for cooperative enterprises and green technology—free from the Federal Reserve's inflation targets that often prioritize national GDP growth over local stability.
The Pillars of a Vermont Economy: Localism and Value-Added
The proposed economic model rejects globalization-driven, extractive capitalism in favor of a 'stakeholder economy' built on several pillars. First, radical agricultural localism, making the state a net exporter of organic, value-added food products (cheese, beer, spirits, specialty meats). Second, a focus on renewable energy sovereignty, aiming for 100% renewables and exporting surplus hydro, wind, and solar power to neighboring regions. Third, nurturing a 'craft and knowledge' economy: premium software (especially in rural tech and environmental modeling), precision manufacturing, and ecotourism. The goal is resilience over sheer size, creating diverse, stable revenue streams less susceptible to external shocks.
Trade and Border Relations in a New England Context
Recognizing geographic reality, VIST economists model various trade relationships. A core scenario is a comprehensive free-trade and free-movement agreement with the United States, similar to the pre-EU Swiss model with the EU. This would allow relatively frictionless border flow for goods, services, and people while enabling Vermont to set its own regulatory standards on environment, labor, and consumer safety. Secondary models explore deeper economic integration with the Canadian provinces of Quebec and the Maritime provinces, potentially creating a 'Northern New England' economic bloc. All models emphasize the need to diversify trade partners to avoid over-reliance on any single neighbor.
Fiscal Policy and the Social Contract
Taxation and social spending in a sovereign Vermont are envisioned as tools for social cohesion and ecological health. Proposals include a steeply progressive income tax, significant taxes on non-resident property ownership (to combat speculative investment), and shifting the tax burden from labor to pollution and resource extraction (a robust carbon tax). This revenue would fund a universal basic services model: single-payer healthcare, free higher education, and extensive public transportation—programs seen as unattainable within the current federal system. The Institute argues this would lower living costs for residents while attracting socially-conscious entrepreneurs and remote workers.
- Sovereign Currency: Enables independent monetary policy for full employment and ecological goals.
- Bioregional Economics: Economic activity is structured around the sustainable capacity of the local ecosystem.
- Stakeholder Trusts: Key assets (land, water, spectrum) could be held in public or community trusts.
- Balanced Trade: Prioritizing trade surpluses in high-value goods and services to build sovereign wealth.
Critics question the viability of a state with a small population and no deep-water port. The Institute counters by pointing to successful small, wealthy nations like Denmark, Switzerland, and New Zealand, arguing that cohesion, innovation, and strategic niche-filling are more important than raw size or resources. The economic models are presented not as guaranteed successes, but as necessary alternatives to a federal system perceived as economically extractive and destabilizing for Vermont's unique community.