Wednesday 14 May 2014

Imagine the poorest areas could survive using their own resources

Imagine.  Imagine it might be possible to set aside the great lie of economic strategy (trickle down patently doesn’t trickle; it hoovers up).  Imagine the poorest areas could ride out a world recession.  Imagine they were not forced to go cap in hand to big business or big bureaucracy to survive.

It is hard to over-estimate the impact on the world, and certainly on the UK, if we could find the techniques we need – to help neighbourhoods survive using their own resources.

It will clearly not make them rich, but it may keep them from being poor – and the difference that will make, if it works, in regional power dynamics would be profound

But is it possible?  It would mean using the money better which is already flowing through the community.  It would mean using the wasted people, land and buildings, the waste material – putting them altogether and - well, not wealth exactly, but enough economic activity to claw back some of their economic destinies.

The difficulty is that these economic techniques exist but, in the UK at least, they are in their earliest stages – usually based on community banking or community energy generation.

We can catch glimpses of what is possible in the efforts of local authorities like Enfield or Preston, looking at different ways of doing procurement.  We can see it in the development of linked local food businesses in Vermont, or the community currencies for women entrepreneurs being rolled out by the Brazilian central bank

We need to develop these ideas, and I set out how in my report Ultra-Micro Economics, published today by Co-operatives UK.  But there are three important blockages.

First, our institutions of regeneration, from the energy intermediaries to the high street banks, are designed for big institutions and find it hard to connect with small players. Try helping your village generate its own energy and things get difficult.

Second, there is a blind spot about economic regeneration in most local authorities.  They don’t see it as their business, and this kind of learned helplessness – passive in the face of whatever disasters the global economy might throw at them – has been carefully nurtured by the Treasury for a generation, terrified of the spectre of the Bank-of-Our-Friends-in-the-North.

Third, there is a kind of snobbery among economic policy-makers about it, as if ultra-micro was all a bit too small to matter. Economic strategy has kudos and status; looking at money flows on the ground and how to make money connect more locally isn’t what they imagined doing.  Money flows? It’s too much like plumbing for comfort.

But the real lesson is that small-scale matters.  The ultra-micro approach transcends conventional right and left, just as it goes beyond the conventional distinction between free and controlled markets. But the real argument is about scale, if enough people and places are doing this, then - as they say in America - small plus small plus small plus small equals big.

It is up to our political thinkers (you know who you are!) to name this and run with it...


David Cox said...

We need a reinvigorated Community Politics, “Liberals, go back to your constituencies and prepare your communities to govern themselves”.

Whilst I don't agree with his ultimate ends, Bookchin argued that social change should be at the municipal level, saying "The overriding problem is to change the structure of society so that people gain power. The best arena to do that is the municipality — the city, town, and village — where we have an opportunity to create a face-to-face democracy."

Anonymous said...

Greetings from Manchester David

From my experience of working in Wigan, I don't believe it is snobbery, or a blind spot. It is as you say a question of big versus small.

Big organisations are culturally different from small organisations, particularly when the big = the local authority. What has happened in the recent past, is that councils haven't trusted community groups to spend regeneration monies wisely and as such have 'administered' the grants on terms that suit themselves. And this gives them a chance as 'the accountable body' to take their cut of the grant monies drawn down from central gov or Euro monies pot.

What makes it worse is that the community groups that know their community inside out get used by the LA to deliver the 'last mile' monies. Very often, the councils will simply steal good ideas from community groups and pass them off as their own. Seriously - councils have a very bad reputation in that regard.

But in fairness, the councils are having to change their tune now - they don't have the money or staff to do what community should have been doing all along.

Now the problem is one of scale. What is the civic infrastructure mechanism that can get the money from the top to the bottom with the least amount of friction (aka commission)? How do the funders decide which community groups deserve what amount of funding? What is the mechanism - where is the transparency?

It's missing.

The whole infrastructure needs building from the ground up.

And community groups haven't been great at coming together and working as one. A resource shortage has turned them into competitors - desperate for survival. The last thing they want to do is collaborate with a 'rival'.

But coming together and creating a joined up network of community groups, charities and good causes is exactly what we need. It needs to be connected in common purpose and it needs to tell its story in a way that attracts investment from the public sector AND from the private sector.

Above all, this community of communities needs to systemise the way it does business so that it is in that community's best interests to connect share and trade in a way that recycles underused resources into goods and services that the same community would consider of value.

It's all about the incentive.

These organisations need to be incentivised to cooperate and work together.

The public sector needs to be incentivised to support such cooperation and collaboration.

Business need to be incentivised to support such activities.

What we need is a valuation system that incentivises communities to solve their own problems and rewards those that help them in this quest.

And that's where we come back to time banks and community currencies which you are very familiar with.

Its time a community of communities printed its own money and gave people the credit they deserve when they produce something of value for it. Bolted onto an e-commerce platform and what you have is a social stock exchange.

Get your backside up to England's northwest David and see how we're doing it in the city that is famous for free markets and civil rights.