If money was more like water
Town & Country Planning, Marchl 2010
I had a strange New England experience last Saturday night, turning out to the church hall - who else spends their Saturday nights in political revivalism - where I am staying in the still snowy western fringes of Massachusetts, and hearing a revivalist academic talking about local economics.
Nearly 200 people turned out to hear him, sustained only by an almost infinite number of cookies, but an unheard of audience for any equivalent Saturday night in the UK.
Gar Alperovitz is from the University of Maryland, but he is one of those sixties survivors that command huge respect from the localist movement. He is also one of the only optimistic ‘liberals’, as they say here, that I have met since I have been in the USA.
In fact, he was somewhat dismissive of the kind of leftists who are doing so much hand-wringing over here. “Liberalism is a resistance movement,” he said, “not a progressive one.”
Instead, he praised the new Tea Party movement as the key to the future. This is an unusual stance for a dyed-in-the-wool liberal, because the Tea Party is an uneasy mixture of anti-government, gun-toting, paranoid, Sarah Palin voters. But they are also furiously anti-corporate. They rage against the big corporations and the big banks.
They are being manipulated by the right, said Alperovitz, but they are also a powerful new political movement – part left and part right – who want a major change in the system, including far more local decision-making.
We may see something similar in the UK soon, exemplified so far by the former theologian and Conservative policy pioneer Phillip Blond. The signals are there, and most politicians will no doubt fail to see them, as usual.
But the reason Gar Alperovitz was excited was that the sheer intractability of the mainstream systems, political and economic, is leading to a wave of local innovation. “In city after city, people are trying new things,” he said. In other words, local government is simply going to bypass central government – if they are given the slightest opportunity of doing so.
Alperovitz is interesting, in this respect, because he is one of the main instigators of what is one of the most exciting local projects anywhere in the world, an innovative combination of local money flows and Spanish-style co-operative businesses.
This is the Evergreen Project, and it is happening in Cleveland, Ohio, which is probably the epicentre of the conflagration that followed the collapse of the sub-prime mortgage market and the banking crisis.
There are two major economic players still active in the city of Cleveland, and they are active because they are in the public sector – the university and the hospital. Both are spending money, but where? And is it making a difference to Cleveland in a way that can improve both their economic prospects?
If Cleveland’s hospital spends large chunks of its money on contractors elsewhere in the world, or if it banks its money in Wall Street rather than locally, then of course it will mean more local ill-health, greater demand and less local resources to tackle it.
Instead, the Evergreen Project is a way that the hospital can start spending a much larger chunk of its procurement budget in the city. But that much is hardly new. The next part of this project borrows from one of the great success stories of co-operative business, Mondragon in Spain.
The Mondragon story dates back to just after the Second World War, when the local Catholic priest, Jose Maria Arizmendiarrieta, founded the first worker’s co-op to employ local people and meet local needs.
Half a century on, there are now 256 linked co-operative businesses, employing nearly 100,000 people and with offshoots worldwide, and they have been doing even better during the global downturn. So much so that the US steelworkers union have signed a long-term agreement to do something similar in North America.
The Evergreen Project aims to do it in Cleveland, but clustered around and dependent on the hospital, starting with a major sustainable laundry business. The second project is going to be a renewable energy company, again giving local people an ownership stake, and starting with installations on the hospital roof.
This is a hugely exciting new departure for localism. It provides a glimmer of an idea about how cities, towns and regions might re-grow their local economies, and make sure that the benefits stay local, and that local people have an ownership stake in them.
It also sees money slightly differently, regarding it as more like water. It sees local economic recovery not so much in terms of scarce investment, but in terms of making the flow work better. If money is water, then you can direct it, use it for irrigation, build your mills on the streams. You don’t just wait around, and wring your hands and say desperately – if only someone would build a river here.
Cleveland is using what flows it has for irrigation, and building out from there. It’s a model of the future.
David Boyle is a fellow of the New Economics Foundation and the author of Money Matters: Putting the Eco into Economics.
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