Michael Shuman: I would say that we are winning We last spoke to Michael Shuman just over three years ago. He is author of several books on local economic development, the most recent being Local Dollars, Local Sense. He is an attorney, an economist, and his current job title is Director of Community Portals for Mission Markets. Not every day you meet one of those. As someone who knows more about economic localisation than most, I was keen to pick Michaels brains on the impact he sees it as having, and how Transition initiatives pushing in that direction might be able to measure the impact they are having. Our theme this month is about the impact that Transition has had. From where you sit, what’s your sense of the impact that Transition has had as a movement, as an approach? There’s two ways that I would look at that. One way is Transition as an idea and the other way is Transition as an organisation. I think Transition as an idea has been tremendously effective. In the United States it has many different names. Some of it comes from the Post-Carbon Institute, some of it just comes from the environmental community, some of it comes from BALLE and other organisations. But the idea that the global economy has become unreliable and that we need to rebuild our community economies from the ground up has taken hold everywhere. I don’t travel to a lot of places around the world, but maybe to a dozen countries, and every single one of those countries that I have gone to including developing countries like Brazil, there is evidence of this Transition underway. A couple of years ago I did a study for the Gates Foundation called Community Food Enterprises where we looked at 24 examples of great local food businesses. Half of them were outside the United States. In every one of these countries that we looked at there was an interesting profound localisation movement taking place. The second part of the question is Transition as an organisation. To what extent are people using Transition materials as opposed to other things? My sense is that Transition is very strong in Canada and Australia and through much of Europe. I don’t see Transition having quite as much visibility in most of the United States yet, or having as much visibility in places like Japan or a lot of developing countries. But I think that’s changing and I appreciate there’s only so many hours in the day and you guys are working as hard as you can to get the message out. A lot of your work, and increasingly a lot of what we do at Transition Network, is about trying to model and communicate and show in practice how localisation is a form of economic development, and is as valid, if not more valid, than the current approach. Where are we at, do you think, in that pursuit of being able to model and argue and present the case that localisation and more resilient local economies are a form of economic development? I mostly follow evidence inside the United States and from that I would say that we are winning. There’s just been study after study that’s come out showing that localisation is good for job growth and good for per capita income growth, good for reducing poverty and good for environmental restoration, good for resilience. It is much easier, I think, to identify the small number of holes that remain in the localisation argument than to talk about all the good things that are happening. I’ll give you an example. There was a nice study that came out from the Federal Reserve of Atlanta last August that looked at hundreds of counties across the United States. It performed a very empirically rigorous analysis and found that those counties with the highest density of local and small business were those that actually had the highest level of per capita income growth and were doing the best job of reducing poverty. Which is quite an extraordinary finding. It’s extraordinary because there’s also a whole bunch of data that says that the wages paid by smaller businesses are lower, a little bit lower than those of larger businesses. The question of causality, the question of how these two facts ought to be related to one another is an interesting one. Among the things that I think about are that at the end of the day, even with somewhat lower wages, local businesses spending more money locally are generating higher economic multipliers that generate more healthy public sectors that come back to people in other ways. That’s one way of thinking about it. Another way of thinking about it is that the wage gap may in fact be narrowing. There is some evidence of this although I would like to look at the data again. The last time I looked at this data was maybe 5 or 6 years ago. Generally speaking, larger businesses paid more specifically because unionised manufacturing plants had significantly higher wages for the average worker. Most of these plants have moved overseas. Instead, what has taken their place in a lot of US cities is Wal... buff.ly/1lnxv…
Posted on: Mon, 28 Apr 2014 17:05:23 +0000
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