Economics for the Future

How's the economy looking to you?

Of course, none of us has ever seen "the economy," since the term is just an abstraction. But it is an abstraction that covers such a broad range of activities that we probably need a few new words to cover them all.

If you're poor, the economy doesn't look too good. Worse, there are many people with power who don't have your best interests at heart. The US House is flirting with reductions in food stamps of up to $135 billion (while keeping subsidies for already wealthy mega-farmers).    

Cynically, state legislatures are denying the poor the opportunity to receive health care coverage under ObamaCare. In Michigan, for example, working parents now must be below 64% of the federal poverty line to receive Medicaid; jobless parents must be below 37%; and childless adults are ineligible altogether. With Medicaid expansion (a provision of ObamaCare that the Supreme Court ruled each state could make its own decisions about), people in each of these groups would be eligible if their incomes were below 133% of the Federal poverty line. Yet the Michigan Senate is unsure if will allow this, although the federal government will cover more than 90% of the cost for the next decade.

On the other hand, the economy looks pretty bright for those with the smarts -- make that connections -- to benefit. Thomson Reuters has come under scrutiny for packaging the University of Michigan-produced consumer confidence index for the benefit of high-frequency traders who pay to receive it two seconds before it is released more widely -- a window in which hundreds of thousands of trades are executed and millions of dollars made by understanding consumer sentiment just a shade in advance of other stock traders.

Legal or not (there is some question), and ethical or not (ditto), this kind of economy has been designed for the exclusive benefit of the wealthy. Despite claims of creating more efficient markets, there is nothing in this kind of activity that resembles the economic activity that benefits, and that we can "see," on Main Street.

That economy -- the real economy -- is defined by jobs, actual goods and services, and enduring relationships -- not milliseconds. As Marjorie Kelly explains in Owning Our Future, this economy can be structured for sufficiency (genuinely meeting a community's needs, over a long period) rather than efficiency (trying to make as much money and profit as quickly as possible). The key is developing means of ownership that create genuine wealth, whether that ownership is in the hands of employees, communities, or mission-driven organizations.

Just one example, which Kelly mentions: Evergreen Cooperatives in Cleveland provide jobs and opportunities for low-income residents. Its employee-owned green laundry, solar/energy efficiency, and hydroponic gardening businesses contract with major Cleveland organizations including the Cleveland Clinic, University Hospital, and Case Western Reserve University to provide needed services. The revenues from these businesses stay within Cleveland to create community wealth rather than wealth for absentee owners, mainly supporting residents with household incomes below $19,000 (the federal poverty line for a family of four is $4,500 more than that). An institution that received much deserved recognition at the recent BALLE conference, Evergreen businesses allow employees to purchase an ownership stake in the company after six months of employment (which it helps finance), entitling them to vote on all issues (one vote per owner), to receive health insurance, and to expect $65,000 in equity from profits in eight years of employment.

This kind of economy has many different manifestations. What unites them is the vision of a stable, inclusive community, striving for sufficiency, honoring the needs of people and respecting the natural world. An economy built to endure, not live its life in seconds.

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About this Entry

This page contains a single entry by Michael Gordon published on July 15, 2013 8:34 PM.

Biomimicry and Cities was the previous entry in this blog.

The Community of Detroit is the next entry in this blog.

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