Local Economies

I want to extol the many virtues of thriving local economies, but my time today is brief and so I will begin with a quick and dirty argument for local economies. I promise to try and flesh out my reasoning in later posts, but for now, I'll make some rather rough but expedient assertions.

What is a local economy, you may ask, and how is it different from any other economy anywhere? At its most basic an economy is really just a name for human activity related to producing, distributing, exchanging and consuming goods and services. In the present day the majority of societies use some form of currency (money) as the unit of exchange for a good or service, because each society has decided that the money represents a store of value. In most cases these currencies are also backed by a nation's banks. But I digress...In our era of globalization, at least in the U.S., our prevailing economy is based on goods and services that have been extracted, produced, and distributed from virtually everywhere. Take, for example, a box of Earl Gray tea in your pantry. The tea leaves were likely grown in India, then transported to a processing facility where they were dried and put into tea bags, the materials for which were probably extracted and manufactured on another continent and shipped to the tea processing facility. If the company selling the tea is "environmentally conscious" the tea bags will not be individually wrapped but will simply be put into a box or canister, which was also likely made in some other city or country, and transported to the processing facility. Once the tea is packaged, it will be transported to a storage facility where it will await distribution to cities and towns all over the world. Are you following this? Using the Earl Gray tea as an example, it is probably safe to say that, in our current globalized economy, the majority of the goods and services we depend on have similar, if not even more obscure and distant origins and distribution. The globalized economy is NOT a local economy.

Let's take a closer look at what it means that the Earl Gray tea you purchased for $4 at the local supermarket was brought to you by the global economy. Do you know where the tea was grown? Do you know how it was cultivated or how the growers and pickers are treated? Do you know if petrochemicals were applied to the tea plants in order to enhance growth or discourage insects and/or fungus? Do you know what affect that particular tea company has on the surrounding community? Are they a good employer? Does the company minimize pollutants and act as a good steward of the land? Were people displaced from their homes so that the company could clear the land for agriculture? There are a million other questions that could be asked of this one small part of the process that brings you your cup of tea, but the point is, you probably don't know the answer to any of them. You also don't have much, if any, control over them. How does that make you feel?

A local economy, just like it sounds, localizes to a community the activities of extraction or recovery, production, distribution, exchange and consumption. So, conversely, products brought to you by a local economy are products that you, or someone you know, will likely be able to weigh in about. What's more, a locally sourced and produced good--let's say, a bottle of fruit juice--should leave you with few, if any, of the aforementioned questions unanswered. Local economies are transparent economies. They are also almost always more democratic. What are some other positive attributes of local economies? What follows is a far from exhaustive, but reasonably thorough list.

1) Local economies require relationships. When was the last time you met the person who grew your food or built your bicycle? When was the last time you were able to provide feedback to the person who built your bookshelf?

2) Local economies mean fewer hoops. What do I mean by that? In a truly localized economy, the person making the decisions about a good or service that I need probably lives nearby. Any fallout from a poor choice will be readily apparent, and will require resolution to the satisfaction of the community. This is very different from a transnational or even a national corporation that can shield itself from criticism and any community obligations because it doesn't have a home within one community.

3) It is harder for local producers and companies to externalize their costs. Price is just one means (and often a not very good one) of measuring a product's cost. There are countless other indexes of cost that should be important considerations. Once a resource is extracted, is there enough remaining for continued production of the product, or will the rate of extraction eventually use everything up? Does the production of the product create other biproducts that cannot be safely disposed of? Was one or more persons displaced so that the producer could build a facility? All of these are additional costs usually not reflected in the prices of goods in a global economy. Because a community truly feels the full costs of any economic activity, a local economy is likely to be one in which producers incorporate the full cost of doing business into the price of their product. A local economy is also likely to be much more interested in developing goods and services that can be extracted and produced sustainably.

4) In local economies goods and services are often based on local needs and demands. Make sense? Enough said.

5) Local economies are in a position to promote business models of cooperation and sharing rather than competing and hoarding.

6) Accountability is much more readily facilitated in a local economy.

7) Local economies are interdependent and require cooperation.

8) Local economies are much more likely to produce a living wage due to mechanisms for feedback and accountability.

9) Local economies keep wealth localized.

10) Local economies mean local regulation and oversight of health and safety.

11) Local economies generally eschew mass production, affording workers the ability to see the fruits of their labor through numerous stages of production, and to take pride in their contribution to a much more apparent "big picture."

As previously noted, this list is far from exhaustive. But it's a start, and it's all I have time for today. Local economies hold tremendous promise for all of us as we begin to discover how fragile and unsustainable our current globalized economy really is.