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Economic
Stimulus: Yes We Can, Locally
Are
ordinary consumers responsible for the financial crisis that
has brought the national economy to its knees? In many ways,
no. Most of us had no say in the deregulation that paved the
way for subprime mortgages and other high-risk behavior of
financial institutions that are now gasping for air and pleading
for federal bailout money. Most of us have no control over
the business and investment practices of the large corporations
whose lack of fiscal discipline threatens to saddle the U.S.
economy with widespread unemployment and a ripple effect of
economic woe on Main Street. And most of us can only sit back
and wonder at the logic that deems such institutions “too
big to fail.”
And yet, in another sense we are all responsible, because
of the many ways in which we have invested, however unwittingly,
in the global economy’s house of cards. By now it’s no secret
that many ordinary Americans, encouraged by the easy credit
of the past decade, have borrowed more than they can afford
to pay back. Less obvious, but no less real, are the ways
in which our day-to-day living and spending habits—making
long commutes to and from work, shopping at big-box chain
stores, eating processed foods shipped in from thousands of
miles away—have put us at the mercy of national and global
economic instability by eroding the once-tightly-knit fabric
of our local economies.
Our buying and borrowing habits do matter; the good news is,
by understanding and acknowledging the power we have as consumers,
we can turn that power into an engine to revive our local
economies, in the Capital Region and all across the nation.
Common sense should reinforce what research already shows:
When we spend money on goods and services from locally owned,
independent businesses, the positive impact on the local economy
is significantly greater than when we spend the same dollars
at big-box stores and other nonlocal chains. When we buy from
corporate chains, we do help pay the salaries of that chain’s
local employees, and, to the extent that they contract with
local suppliers, we help support their livelihoods too. But
a large percentage of that money leaves the region immediately—and
often goes toward things that undermine the economy on both
the national and local levels, including overseas imports,
anticompetitive capital investment, inflated corporate salaries,
and lobbying for tax breaks that are never offered to small,
locally owned businesses.
According to commonly cited research, 73 percent of consumer
money spent on locally owned businesses recirculates within
the local economy, compared with a mere 43 percent of money
spent on national chains. Given those numbers, a relatively
small shift in consumer spending habits could have a staggering
effect on local economies everywhere.
With the holiday shopping season upon us, Metroland
offers this challenge to its readers: Make a concerted effort
to spend $100 of your holiday budget on locally owned businesses.
We believe it is reasonable to assume that many of our readers
spend at least this much, if not quite a bit more, on holiday
gifts—and that the local business community offers plenty
of opportunity to spend $100 right here. In case you’re not
sure how much impact that could have, consider this: If everybody
who reads Metroland at least once every four weeks
accepts this challenge, the net positive impact on the local
economy could be as much as $5 million. (For more information
on how you can participate in the challenge, please see the
promotional ad on page 7.)
In offering the $100 buy-local challenge, Metroland
has joined an initiative spearheaded by Jody Colley, publisher
of the East Bay Express in Berkeley, Calif., which
now includes more than 80 participating alternative newsweeklies
across North America. Our intent is not to be strictly anti-chain:
We recognize that not all of your consumer needs can be met
by local businesses. We are asking that readers make the effort
to consider their options and buy local where and when it
makes sense to them (and also to recognize that the sometimes-cheaper
prices at large chain stores do come with a cost to the local
economy).
Imagine a community where independent businesses, stores,
farms, arts institutions, etc., supported each other and provided
for a large percentage of consumers’ goods, food and entertainment;
where necessary credit was provided by local, nonpredatory
financial institutions that were invested in the long-term
health of the local economy; where little effect was felt
from the risky speculation and unsound investments of large,
faraway corporations. Does that sound too utopian—or does
it sound like something worth working toward? Think of the
buy-local pledge as a small first step. Our local business
community has a lot to offer—and all of us, collectively,
have a lot to offer our local economy by thinking twice about
where we spend our money this holiday season and beyond.
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