Building a Local Economy: Where to Start?

P1000350Quite a lot has happened in the Golbabai house since I lased posted. After months of studying, I passed my American Institute of Certified Planners (AICP) certification exam so I can now write this blog as a certified planner! A few days later, Paula and I welcomed the newest addition to our family, our beautiful baby daughter. Both Mom and baby are doing well and we’re all adjusting to this new reality of life as a family of four!

Over the past few weeks I’ve been really struck by my two children. Looking at our newborn daughter, I’m amazed at just how completely dependent we are on others when we come into the world. With only the ability to cry as a means of communication, we are forced to rely on others for even the most basic needs – for food, clothing, comfort, shelter, even help lifting and supporting our own head. Then I compare that to my almost-two-year-old son, who is in a stage of life in which he wants to do everything himself. He wants to make breakfast in the morning, buckle his own seat belt in the car, climb the most daring playscape, and mow the lawn singlehandedly (yet somehow the drive to use the toilet takes far more coaxing). There’s this strong desire to be more and more independent but, whether he knows it or not, he needs a little help to get there.

Similarly, when it comes to our local economy, there is great value in the attempt to become self-reliant and independent – from increasing the local economic multiplier to increasing local participation to increasing local environmental standards. But in the tangles of a global economy, how does a local community even begin the process of trying to develop locally? In his 2002 Schumacher Lecture, lawyer and author Michael H. Shuman suggests four projects that can serve as that starting point:

  • Creating A Local Business Directory: Per Shuman, identifying and cataloging locally owned businesses “enables consumers to identify and patronize those businesses that are locally owned. It helps local businesses buy inputs from other local businesses and provides activists with information they need to create a local currency or buy-local campaign.”   Here is a good example of a local business directory courtesy of the Austin Independent Business Association: http://www.ibuyaustin.com/aiba-community/local-business.html.
  • Performing A Leakage Analysis: If one is serious about substituting imported goods with local goods, an analysis of where the economy is leaking money is a good start. One of the best I’ve seen comes from the Peace and Justice Center which analyzed the economy of its home state of Vermont. In this 2000 analysis, the study found that Vermont was exporting $16 billion in cash out-of-state, the equivalent of over $26,000 for every Vermonter, and developed a number of strategies to keep this cash invested in-state.
  • Conduct A Subsidy Assessment: Which elements of your local economy are being subsidized by taxpayers and which aren’t? Do these subsidies put local businesses at an unfair disadvantage? Are there strategic investments that can build local independence and resilience? A comprehensive list of state and local economic subsidies can form a basis for community conversation and begin the process of developing models that support local entrepreneurship.

As my children illustrate, we all start off needy and dependent, but with a desire to learn and grow we can become increasingly self-reliant and independent. This personal economic maturation process eventually allows us to first take care of ourselves, and then bear responsibility for taking care of others (whether our own children, our aging parents, or contributing our work to the world). In a similar way, if locally we take a look at what we’re economically dependent on outsiders for (what we’re importing) and have the desire to do it ourselves instead (import substitution), eventually we’ll get to the point of providing for others as well (exporting). This is how our economy grows up in a sustainable and healthy way!

3 thoughts on “Building a Local Economy: Where to Start?

  1. I love your local perspective. It is something that I believe deeply and advocate for but find it so hard in suburban America. Great tips on where to start for a community just kicking off a focused future.

    Like

  2. Pingback: The Local and the Global: Lessons from Detroit | The New Localization

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