Sustainability requires that every community meet the needs of all its members (including plants and animals), present and future, without compromising the needs of other communities meeting the needs of their members, present and future. — Michael Shuman
Is neighborhood economics at a tipping point? Consciousness certainly seems to be getting there. This is a skeletal summary of some key points, plus a few links to some of his vital resources.
Michael Shulman asks us to consider how local business employers tend to pay less than global corporations can, yet they contribute more to ending poverty and increasing prosperity. How? By increasing per capita growth rate. Compared to chains and other nonlocal businesses, local capital creates job growth, which is a fundamental economic multiplier.
Another advantage of growing business “in place,” is in its being rooted. A locally-owned business isn’t about to pull up its tent stakes and move operations overseas. And local business contributes to the vital web of civil society, an essential invaluable for democratic society to thrive.As a cheat-sheet for remembering six keys steps for a flourishing local economy, Michael Shuman unveiled his 6 P’s:
- Planning – Plug the leaks. Analyze all the places in your local economy where you are unnecessarily buying outside goods and services.
- People – Support local entrepreneurs.
- Partners – Compete through collaboration. Try to organize local business alliances so that businesses working together are more competitive than they would be working apart.
- Purse – Harness pensions locally. (This could create a one trillion dollar shift.)
- Purchase – Spearhead “Local-First” campaigns.
- Policy-making – Remove anti-local biases.
The viability of local economies, the Transitions Towns movement, and local food all attest to the time being right. As we move forward, please keep Michael Shuman on your radar screen. He has much to teach us, and does so in a concise, clear way, reflecting decades of personal engagement, that’s positively tonic. His two latest books are THE LOCAL ECONOMY SOLUTION: How Innovative, Self-Financing “Pollinator” Enterprises Can Grow Jobs and Prosperity (2015), and his community resilience guide LOCAL DOLLARS, LOCAL SENSE: How To Shift Your Money from Wall Street to Main Street &Achieve Real Prosperity (2012). Two recent shorter pieces also worth perusal are his 24 Top Tools for Local Investing, and Revitalizing Communities from the Inside Out, his entry in the Centre for Civic Governance’s book RESILIENCY: Cool Ideas for Locally Elected Leaders (Volume V of their Going for Green Leadership Series).
Love a local company enough to invest part of your 401k in it? That now could be a reality, and you can learn more about local investing at an event coming up tomorrow (Tuesday).
Five years ago, several local organizations brought author Michael Shuman to speak about the potential of investing locally. The event http://www.traverseticker.com/story/welcome-to-the-traverse-city-stock-market was considered a success, but some federal laws still made local investing challenging.
The local investment effort then gained momentum in 2012 with the passage of the Jumpstart Our Business Startups (JOBS) Act. It has drawn public attention because it creates a way for companies to use crowdfunding to issue securities, something that was not previously permitted. Different segments of the law went into effect in 2013 and 2015, further enhancing the opportunities for businesses to acquire local investments – and individuals to invest.
Now a growing number of small businesses in the area are using local investors’ dollars to help expand.
According to Shuman, there’s an overwhelming body of evidence that every dollar spent locally generates two to four times the amount of income, wealth and tax base
Local Dollars, Local Sense: How to Shift Your Money From Wall Street to Main Street and Achieve Real Prosperity
Americans’ long-term savings in stocks, bonds, mutual funds, pension funds, and life insurance funds total about $30 trillion. But not even 1 percent of these savings touch local small business—even though roughly half the jobs and the output in the private economy come from them. So, how can people increasingly concerned with the poor returns from Wall Street and the devastating impact of global companies on their communities invest in Main Street?
In Local Dollars, Local Sense, local economy pioneer Michael Shuman shows investors, including the nearly 99% who are unaccredited, how to put their money into building local businesses and resilient regional economies—and profit in the process. A revolutionary toolbox for social change, written with compelling personal stories, the book delivers the most thorough overview available of local investment options, explains the obstacles, and profiles investors who have paved the way. Shuman demystifies the growing realm of local investment choices—from institutional lending to investment clubs and networks, local investment funds, community ownership, direct public offerings, local stock exchanges, crowdfunding, and more. He also guides readers through the lucrative opportunities to invest locally in their homes, energy efficiency, and themselves.
A rich resource for both investors and the entrepreneurs they want to support, Local Dollars, Local Sense eloquently shows how to truly protect your financial future—and your community’s.
This is the first book in the Community Resilience Series by Chelsea Green Publishing and Post Carbon Institute.