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Notes from http://localfoodsystems.org/leadership-summit-2009

Michael Shuman talked about:

 

 

TINA

TINA = There is no alternative to "global economy".

Attract and retain business is the core strategy

LOIS

LOIS = Local Ownership Import Substitution

Inspire by thinking from Jane Jacobs.

* Wealth creation
* Good jobs
* Sustainability
* Strong Neigborhoods

LOIS reduces Carbon Footprint

How to Nurture LOIS

Planning: Plug the leaks: stop importing so many outside goods and services, energy, work locally. Bank Locally.

People: Support LOIS entreprenuers through intestment, tax breaks, and moral support, mentoring, relationships that are positive.

Partners: Compete through collaboration. Sam writes: Bill Tozier: Mutual Mentoring http://williamtozier.com/slurry/2009/03/15/mutual-business-coaching

Purse: Leverage Pensions Locally, leverage surplusses locally. 

Purchasing: Spend Locally first. (Local first) Meta businesses: a business that surpports other local businesses, which generates surplusses. Exampe: coupon book for local businesses is the best selling book in local bookstores. A revenue generator for local businesses in the town the idea is used. Another example: a community debt card that generates credits when local purchases are made. A local bank made this card anticipatingthat they will get people to move accounts over. Card cost the bank $100,000.00, yet is a revenue generator for local economy.

Policymaking: There are some states and locations that have made policy that works around local stock exchange issues. MERC in Rocky Mountain states is an example of low cost local stock.

5 easy policies for Ohio:

1. Smart Planning plan thinking local first

2. Smarter Land Use policies: making better use of empty land, land trust, big box impact statements, home based

3. Smart financial reform  permit coops to create investment interest, tax credit, create local stock exchange

4. Smart Procurement  ask the people who you do business with what percentage of business they do in local area, and adjust price based on that

5. Geeen taxes  better taxes for people going green and making smart energy choices

What are the laws in regards to Local Business Investment?

What are the exemptions in each state, or via SEC?

Right now it is not legal to create a local stock exchange, although NASDAQ could do so.

Ownership stakes in COOPs are expempt from serurities laws. One problem is where COOP takes surplus money to invest in other businesses, this is a gray area.

Investment clubs were mentioned, see: http://www.sec.gov/investor/pubs/invclub.htm

Local Economy Mutliplier Effect

There is an exponential growth of local economy when ownership is local

Example:

Green Bay Packers

A community owned sports team: community owned helps prevent the revenue for this entertainment from being sold off or exported

Multiplier Impact examples

It is more than 30 times more expensive to create jobs with TINA than with LOIS

Same book bought at local bookstore vs. chain like Borders keeps 3 times the amount of money in local economy.

Shifting 20% of food spending towards local foods would create 5000 jobs.

Food could create more jobs and economic development than any other economic sector in cities like Detroit and Cleveland.

Strong Communities

Studies show that communities made up of locally owned businesses are "stronger", safer, attract more tourists. Uniqueness of cities and neghborhoods and regions is what brings in visitors and tourists

How can you have a walkable community in a city that is made up of "big box hell holes", and industrial parks?

Walkable communities consist of small businesses mixed with residential neghborhoods

We'll never attract Richard Florida's so-called creative class unless we have unique collections of small businesses that make up the majority of the economic driver in the area.

Arguments Against Local Economies

* Local businesses are the backwater of old economy
* Most local businesses fail
* cannot innovate
* Cannot compete

 

Michael Shuman offered reasonable arguments against all of these, and has travelled the country debating critics of local economies. See: 

Long Tail in Local Business

The power law, or "Long tail" applies to local businesses. Local, and small business make up 58% of US GDP

Subsidized Large Non Local Business

Our government subsidizing the large business minority, and is the only thing that keeps small business from outcompeting big business

Very little of our pension money or investment money goes into local businesses. Part of the reason is that we have securities laws that make it really expensive for people to invest in local business. These laws make it nearly impossible for investment to come into small business.

There are laws and subsidies that incentivize offshoring of business

Catherine Austin Fitts

 

Talked about Popsicle Index, the % of people who believe their child can walk to a nearby place, buy a popsicle. and return home safely.

In Tenn., in 1950's when Dow was 150, popsicle index was 100%, now that dow is 2000-140000, posicle index is very low. (ref

Catherine Austin Fitts ).

This is part of Local Leadership conference.  Local Economies are central to Localized Food Systems and Network Agriculture.

Local Infrastructure

* Credit Unions
* Literacy of Local Finance, and how local fits into larger systems
* Solari Circles
* Community Currency
* Local Banks and Credit Unions
* Position assets and donations to opportunities
* Barter: create local barter networks
* Create Local Media
* If you are not a local investor, align with local investors
* Engage local religious, municipal leaders
* Get literacy of law

Sam adds

* Localized Clean Energy
* Waste Equals Food
* Localized Food Systems
* Create Commons!!!!!!

Where does the majority of our money go?

Majority of our taxes and fees, investments, go to finance war/military (reference?).

Most of our values currency comes from elsewhere (China, etc)

Our human capital is being drained

Young people are not being exposed to small business. So, small businesses lack Human Capital the labor and knowlege pool that is needed to sustain commerce.  Young people need to be involved in small business as apprentices or even starting their own businesses, developing their own products, etc

Return to the investor and return to local networks

Money should return to local networks and actual investors.

"Feed the network first" - (Kevin Kelly)

Sam Rose's impression and random notes

There are some problems that can be solved without money, or without focusing on money as the primary motivator. These are Commons Based Economies.

ECLET shows that money is not the primary motivator for everyone who is solving problems.

Local Currency

Communities have lots of money resting in fiat/government currencies.  Prices go up, dollar values go down.

Part of the currency issue is "how do you create a currency that holds value and is adoptable?"

There can be no decentralizing of currency to community until we have a literacy of finance on all scales.

Sam's idea: have you ever thought about creating a game, or model system that will let people "play" in market like you propose? Game could be part of training for both kids and adults.

This could also translate into actual local fund that can give shares to kids.