Archive for the ‘Business & Economics’ Category
Misperceptions of economic relocalization
For economic relocalization to become something more than a fringe movement, it has to make clear that it isn’t simply about the selling and purchasing of goods and services within a narrowly drawn geographic region. I say this because yesterday I heard Karla Chambers, an Oregon farmer sympathetic to efforts to localize our food supplies, tell a large group of sustainability-minded individuals that Oregon farmers cannot survive on local markets alone. We simply have too small of a population. Ninety-two percent of the agricultural products grown here leave the state, she said. Oregon is a natural-resource state, and we can’t consume all that we produce.
I take from her comments that she would view relocalization (a term she didn’t use) as far too extreme to be seriously considered. To her, the goal of relocalization is the end of global trade; that economies should consist exclusively of local companies trading with each other and people consuming only what they can purchase locally. I certainly don’t see it that narrowly, and I don’t believe the majority of relocalization advocates do either. Exporting will never disappear completely. Even if a global energy crisis hits, producers will resort to horse-drawn wagons and wind-propelled ships if that’s what it will take to move their products to markets that want them. After all, countries depended on international trade centuries before fossil fuels and combustion engines came along (of course, much of it was forced trade from colonization).
The point is global trade is here to stay, and clearly it is better economically for a state or community to be a net-exporter than a net-importer. The economic case for relocalization isn’t in becoming a substitute for global trade; it’s in raising awareness that too much of the income produced locally is leaking out of our communities because it is increasingly spent on goods or services from providers that are not locally owned. Think big-box and other chain retailers that source almost nothing of what they sell from local businesses and ship their profits off to headquarters in other states or countries. Keeping money circulating in a local economy multiplies its value by up to three times as it changes hands from one local producer, retailer or service provider to another.
Those of us sympathetic to economic relocalization want to see much more of our communities’ personal and business income stay home and multiply in value. That means citizens spending more of their disposal income with locally owned businesses and local businesses looking more to each other for products and services. And yes, we must also continue to help our local businesses dependent upon national or international markets to compete and win. Bringing money into our local economies from elsewhere is vital.
The issue isn’t either/or, local or global. It’s that political and economic leaders focus almost exclusively on the so-called global traded sector. They all but ignore the leakage of dollars to out-of-state businesses that set up shop in our communities. In fact, they exacerbate the problem by using tax subsidies to encourage many of those very same outsiders to locate here – not exactly a recipe for economic sustainability. The most productive economic debate is asking how to keep more of our money trading locally and help local business owners, like Karla Chambers, win globally.
Tags: economic multiplier, economic relocalization, local business, traded sector
Posted in Business & Economics, Oregon, Sustainability | No Comments »
What would you do if Wal-Mart called?
“He Sold His Soul to Wal-Mart,” the cover of September’s Fast Company magazine shouts.
The story inside doesn’t quite pay off the cover tease, but it offers a fascinating look at the life of Adam Werbach. Or at least what it’s been like since he decided to take on Wal-Mart as a client. That alone isn’t newsworthy. But the plot thickens when you recall or learn that Werbach is the former wunderkind president of Sierra Club and once called Wal-Mart “a new breed of toxin.” After a very public falling out with the environmental movement, Werbach was approached by Wal-Mart to help them with their now much-publicized sustainability initiatives. He eventually agreed. And in the past year his consulting firm has grown from eight to 45 employees, mainly to handle the Wal-Mart work.
The article gets to the heart — and soul — of one of the many contentious debates within the environmental movement. Are environmentalists better advised to become corporate insiders to move business toward greater sustainability? Or do they need to remain outsiders to a consumption-based economy that by definition is unsustainable and needs radical overhauling? Perhaps that choice isn’t as stark for the environmentalist who weighs whether to go to work for a progressive company such as Clif Bar. But when it’s the hated Wal-Mart, well, that’s a line most won’t cross. Had Werbach taken on just about any other corporation in America as a client, he wouldn’t be nearly as reviled by his former environmentalist kin.
While I haven’t walked in Werbach’s shoes, I can tell you this: If I had been approached with the same offer from Wal-Mart, I sure as hell hope I would have run away faster than it takes Wal-Mart to earn its first million dollars each morning.
How about you? Is Wal-Mart “beyond redemption”? Would you have stayed in the environmental movement and tried to make it more effective, rather than walk away like Werbach? Or would you have taken the Wal-Mart gig and figure on making a bigger difference there?
These are my questions.
P.S. Thanks to The Triple Bottom Line Blog for the tip-off on this article.
Tags: Adam Werback, Sierra Club, Sustainability, Wal-Mart
Posted in Business & Economics, Marketing, Sustainability | 1 Comment »
Sampling the local-foods debate
A recent post, “The Eat-Local Backlash,” has stirred up some good conversation over on Grist.org (thanks to BALLE for tipping me off to the blog entry). I encourage you to read both the post and the comments to sample the debate that is emerging over the local foods movement.
The author addresses specific efforts to debunk the claim that shorter distances between food and plate — “food miles” — mean fewer carbon emissions. The commenters take the discussion in numerous other directions, including whether it is better to buy local non-organic versus non-local organic or whether it is immoral to stop buying food from impoverished African farmers in favor of growing and buying locally. I agree with the guy who writes:
“I do think we’re going to be seeing more and more clashes over competing ‘goods’ (reducing carbon emissions and alleviating poverty).”
Speaking of the local-foods movement, the blog author thinks the visible criticism it is getting now in places like the Economist and NY Times is a good sign:
“Just as you’re not really famous until you’ve been rumored to be gay or on drugs, a movement hasn’t come into its own until it’s drawn a formidable entourage of detractors.”
Just getting high-profile media to openly examine the tradeoffs between localized and globalized food economies is indeed a sign of progress. I am optimistic this argument will expand into a much broader mainstream conversation around the merits of turning to local producers for not just food, but for an increasing share of all the goods and services we consume.
Posted in Business & Economics, Climate Change, Food and Drink, Sustainability | No Comments »
The ‘ism’ that rules America
Got a book you must read if, like me, you’re wondering how it is consumption came to rule our lives. Check out “An All-Consuming Century: Why Commercialism Won in Modern America,” by Gary Cross, a history professor at Penn State. It isn’t exactly hot off the presses, having been published in 2000. But it’s no less relevant now, as the urgency to build a more sustainable economy grows each day.
As a long-time marketer (previously in high tech), I’m well aware that marketing, advertising, public relations and the like are big reasons why, in Cross’ words, “Consumerism was the ‘ism’ that won” in the 20th Century. But, as Cross shows, it was hardly just the power of advertising that explains why this ism prevailed.
“Consumerism,” he writes, “succeeded where other ideologies failed because it concretely expressed the cardinal political ideals of the century — liberty and democracy — and with relatively little self-destructive behavior or personal humiliation.”
Cross considers consumerism one of the “meaning systems for human life.” Among his keen observations is that 20th Century critics of mass consumption on the Left and the Right failed equally to create credible alternatives. Those on the Left who advocated simple living and downscaling “all too readily ignored the deep psychological and cultural meanings of goods.” Their counterparts on the Right, meanwhile, decried the threat to “family values” by an overly permissive consumer culture. And yet they also stood with conservative politicians (most importantly Reagan) who worshipped the free market and tore down “the walls that held back the market from seeping into every corner of the American psyche and society.”
Unlike many writers of history who would let the facts speak for themselves, Cross couldn’t resist closing with a chapter on the need to confront the social costs of unleashed consumption. He calls on the Left and Right to find common ground. “A society that reduces everything to a market inevitably divides those who can buy from those who cannot, undermining any sense of collective responsibility and with it, democracy.”
Consumerism has provided meaning for Americans unlike any other alternative system. Cross isn’t optimistic we can replace it anytime soon. Americans, he said, perfected 20th Century consumerism. Now we have to figure out ways to control it.
Tags: An All-Consuming Century, Gary Cross, history of consumerism, Marketing, meaning system, sustainable economy
Posted in Books, Business & Economics, Consumerism, Marketing, Sustainability | No Comments »
Hopeful signs in a global economy
I’m certainly not a champion of economic globalization. Nor am I among those who believe globalization is the root of all evil. The issue is simply not black and white for me. This piece in the Washington Post today helps explain why.
The global economy is giving opportunities, albeit slowly, to India’s lowest castes. The article touches on one young woman from India’s Dalit caste – the so-called “untouchables” – being hired for a well-paid job at a Philadelphia child social services agency. Her father, when he learned of her hiring, said, “I’m so happy and so proud. I never dreamt of such a thing for our family.”
Ideally, no one would have to travel half way around the world to find good work. But for now, American employers can offer hope for a better life to people who have only known discrimination. Of course, this country also has its own long history of prejudice, a fact not lost on Dalit activists, who, according to the Post, “have even lobbied the U.S. Congressional Black Caucus, with whom they see common cause and a shared experience in discrimination.”
Yes, a globalized economy can offer hope and opportunity to the oppressed and poor. Now imagine if that were actually the rule and not the exception in global commerce.
When green values collide
Interesting article this morning foreshadowing what is almost certain to be an ongoing clash of values as Oregon and other regions of the country and world escalate their pursuits of renewable energy. In this case, a wind farm proposed for siting near the eastern mouth of the Columbia Gorge is drawing determined opposition from nearby residents and Gorge preservationists who fear a blighted landscape within view of their property and the Gorge.
The Oregonian reports the proposed development “sets up a conflict between Northwest values, pitting a revved-up desire to advance clean, renewable energy against the long-held belief that rural and scenic areas deserve special care.”
Meanwhile, owners of property where the 40 turbines would be located relish the idea of substantial new cash flow from their farmland. Kind of like I imagine ranchers once did when they learned that oil was below the surface of their property.
This is the kind of complicated, if not wrenching balancing act between conflicting interests that we can expect to see played out in public for years to come. What is the ultimate price we are willing to pay for renewable energy? Because renewable doesn’t mean it’s free. Wind farms dominate landscapes. As long as they are located in remote areas, most people don’t object. But when ideal wind conditions are found within view of many people’s homes or a national scenic area like the Gorge, then what? Does the need for renewable energy trump the desire to protect scenic treasures? Do property owner development rights exceed the rights of nearby residents who object to noisy, marred surroundings?
And I would add one other matter not touched on in today’s article: the value or lack thereof from having an outside company as the wind project developer. From an economic development standpoint, I would much rather see Oregon companies behind these projects. If we don’t have home-grown companies willing or able to tackle energy developments like this, that signals another problem. But first comes the larger question of whether this site should be developed for wind energy. What do you think?
Tags: clash of values, Columbia Gorge, Oregon, property rights, renewable energy, scenic treasures, wind farm, wind turbines
Posted in Business & Economics, Climate Change, Oregon, Politics, Sustainability | No Comments »