Saturday, November 21, 2015

Economic localism: "The $80 Billion Shift We Need Now for Economic Democracy."

We talked about these issues throughout the mayoral campaign.

All too often, community tax dollars benefit the few at the great expense of the many. Our economic development decisions are maintaining a system of inequality.

In a "new economy" how would economic development create real community prosperity?

The executive director of BALLE (Business Alliance for Local Living Economies) provides an overview with selected curatives.

Doing Better: The $80 Billion Shift We Need Now for Economic Democracy, by Michelle Long (via Huffington Post)

Local independent business owners simply must cease performing the ritualistic Kool-Aid communion with municipal officials who are unable (read: unwilling) to understand these points.

You're simply not being helped by their glib assurances.

You're being hurt.

Here are five ways to kick start the necessary shift, but please, click through and read the entire article.


Shifting up to $80 billion (the money spent annually on economic development incentives) presents a massive, ready-made opportunity. Doing better would mean new eligibility rules for community economic development incentives. A community's dollars should be used to support its own people, with particular focus on the areas with the greatest need. If we want the majority of people to receive the maximum return on their community's investment then small businesses must be strengthened at every turn. Minority and women ownership should be prioritized to level the playing field. Bigger businesses should be supported in their efforts to transition to employee ownership.

Here are five ways to start the shift tomorrow:
1. Use incentive dollars to instead back local business hubs and networks that are focused on place, health and equity. These systems of support for locally owned businesses nurture local supply chains, enable peers to support each other, and foster the kind of collaboration necessary to make local food distribution viable or renewable energy locally affordable.
2. Re-direct corporate subsidies to organizations that provide technical assistance to micro enterprises. Groups like Rising Tide Capital are adept at strengthening these businesses to create jobs, and they generate nearly $4 in economic impact for every $1 invested. The Association for Enterprise Opportunity has shown that if just one in three microenterprises was strengthened to hire a single employee, the US would be at full employment.
3. Invest in shared infrastructure for local "economies of scale." For example, a foundation in Maine invested in a local grain mill, providing needed processing that made the resurgence of regional grain farmers viable.
4. Purchase land for the community. Agricultural and community land trusts preserve affordability for residents, farmers, and local business owners in contrast to speculative gentrification. Use land banks to bring vacant and blighted lots under the control of a public authority to redevelop the land for productive uses.
5. Support the creation of worker owned businesses, and support larger businesses, particularly those going through founder transitions, to become employee owned through ESOPs. Businesses from Dansko to Eileen Fisher to New Belgium Brewery have traveled this path in recent years. Said New Belgium CEO Kim Jordan, "One of the things that we think is a big societal issue is this widening gap between the haves and the have-nots. And we realized that we had an opportunity to support people owning something that was increasing in value. Shared equity has been an incredibly powerful engine for us."

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