THE LOCAL ECONOMY SOLUTION

An argument against bringing large corporations to local communities through tax incentives and grants, an approach the author claims is destructive to employment and investment.

Shuman (Local Dollars, Local Sense: How to Move Your Money From Wall Street to Main Street and Achieve Real Prosperity, 2012, etc.), a longtime advocate for promoting local business and a former director of the Business Alliance For Local Living Economies, asserts that “economic development today is completely broken.” Citing the 750-fold increase in subsidies for the movie industry over the past decade, the author debunks the myths circulated to support attracting business in this way, and he argues that such deals do not create jobs but rather take more money out of communities than they bring in. He insists that “those who win the investment lose” and that “it’s high time for economic developers to get back to business.” Shuman views local startup businesses as the answer, especially the kind he calls “pollinators.” These measure success more broadly than by direct returns and include significant contributions to their communities and other local businesses. This approach is intended to strengthen a core feature of the current economy. “All companies that matter,” he writes, “are not globally mobile.” More than half are not spreading across the world but are locally owned and unlikely to move. U.S. capital markets do not often invest in local businesses. Self-financing local “pollinators” address this “huge capital market failure.” Shuman believes that planners should focus on the potentials within their areas through the accumulation of the detailed knowledge necessary, and he provides ways to measure opportunities lost and potential foregone. He also discusses profiles from several cities and counties to exemplify ways in which local businesses are being promoted. These include Sustainable Connections in Bellingham, Washington, and Local First Arizona, among others.

A practical overview of the untapped potentials of a substantial part of the economy.