Digging Deeper into the Local Economy

DeepEconomy.jpgA good half dozen or so people have been encouraging me to read Bill McKibben’s book “Deep Economy” and Griff and Tracy have been urging me to write a post now and then. So I guess this is at least two birds with one stone.

In case you haven’t read the book, I’ll give you my summary in a sentence. McKibben argues that our drive for never-ending growth is colliding with the physical limitations of our world and recommends that we switch our goal from “more” to “better”.

He starts with a historic overview. The major accelerator in our economic growth, and, I’ll note, the expansion of wealth, the sharing of political power, the increase of education, and the improvement in health, resulted from the invention of the steam engine. The simplify a virtually all encompasing change in paradigms, by converting a natural resource of fossilized energy, in this case coal, into power, human muscles with shot at roids could be replaced by mechanical machines.

This scientific breakthrough resulted in great gains in efficiency. Fewer people could do more work. The push for greater efficiency in everything began.

McKibben initially focuses, even obsesses, on the impact of shifting from human muscles to fossil fuels in the economic sector affectionately known as “food”. Most of you have long heard of some of the downsides of our current food production system, such as tomatoes with the consistency of baseballs, various food-borne disease outbreaks, and the destruction of the rain forest. The author instead focuses on an issue that is increasingly noticeable to us, a fossil fuel based, or dependent, system requires a substantial amount of energy. He notes that it takes a half gallon of oil to produce a bushel of midwestern corn.

The author advocates for increasing the consumption of locally-grown food. McKibben cites a Japanese study that found that eating local food would be the equivalent of cutting household energy use by 20 percent. He suggests that by disengaging from the global model of massive corporate farms and nurturing locally-scaled food systems would have other benefits. McKibben cites the most recent USDA Census of Agriculture which notes that “smaller farms produce far more food per acre, whether you measure in tons, calories, or dollars”. Finally, he raises recent studies that have found that switching from petrochemical-based agriculture to sustainable agriculture “has led to an average 93 percent increase in per hectacre food production”.

McKibben illustrates successful models of this shift. They’re not all in exotic locations like Japan, Cuba,and England either. One of them is in Burlington, Vermont. The Intervale Community Farm, next to the city’s power plant, and former site of the town dump, produces 7 to 8 percent of the fresh food consumed in Burlington, a city with a population of about 40,000 people, on just 200 acres of land.

The author argues that the financial feasiblity of fossil fuel-based agriculture may have peaked and is now being maintained by false economies, pointing out that “about 70 percent of the value of American soybeans comes straight from the government”. He notes a New York Times article that looked at Denison, Iowa, a town that was once known for the variety of fruit that it produced, but followed an economic development strategy that was linked to government subsidies and now produces only feed crops for livestock.

But enough about agriculture. Let’s get to a topic of greater interest, at least to me, density.

The next target of McKibben’s criticism is sprawl. Quoting James Howard Kunstler on the 1990s, “The dirty secret of the American economy was that it was no longer about anything except the creation of suburban sprawl and the furnishing, accessorizing, and financing of it”. He goes on to offer statistics from the U. S. Census Bureau: “the average density of cities, suburbs, and towns in 1920 was about 10 persons per acres’ by 1990, it had dropped to 4 persons per acre…and the average density of the most recent housing developments in America is only two people per acre”.

He goes on to illustrate the individual costs of a sprawling lifestyle. Reduction of quality time between parents and children, husband and wife, coaches and young atheletes, and volunteers and their communities, are all too common examples. McKibben, coupling it with what he calles hyper-individualism, expands it to the deterioration of our civic institutions, pointing to the decline of public schools, increase in our prison population, and collapse of our highways and bridges.

McKibben extends his solutions for our food sector to the overall economy. He sees hope in a “shift to economics that are more local in scale”. He finds the building blocks for the recreation of our economy, and social relationships, in the farmers’ market: “sociologists studying shopping behavior reported recently that consumers have ten times as many conversations at famers’ markets as they do at supermarkets”. He suggests a return from society to community, quoting neuroscientist Peter Whybrow, that as we move away from local toward global, “the behavioral contingencies essential to promoting social stability in a market-regulated society – close personal relationships, tightly-knit communities, local capital investments, and so on – are quickly eroded”.

This last bit was quite interesting to me. I had read the book, and written the notes, earlier this past summer. When I reread Whybrow’s quote, it seemed that he had been writing about Wall Street.

McKibben concludes this thread with a slogan that could be an empirical goal, “one-tenth the energy; ten times the conversation”.

The next sector is the media, in this case, radio. The spotlight shines on WDEV, an independent in Barre, Vermont. It’s a great story, but with local radio personality and entrepreneur Jeff Johnson taking over KYMN, we can check that one off our list. The next topic that caught my interest was “complimentary currency”. There’s Berk-shares, issued by three banks in Western Massachusetts. It struck me as another way to potentially increase liquidity, at least in the local economy.

It’s not just progressive idealists generating creative ideas for decentralizing the economy (and the currency), there’s real money involved. Even in a small state like Vermont, if local consumers “substituted local production for only 10 percent of the food we import, it would result in $376 million in new economic output, including $69 million in personal earnings from 3,616 new jobs”.

Back when I was studying developing economies as an undergrad, I believe that such a strategy would have been called “import-substitution” and was considered radical, even threatening, by some global powers. Taking back control of some of our agriculture, some of our media, and some of our capital investment, is it a radical idea?

Or is it no more threatening that what Wayne Eddy has been saying for years, “Keep Your Money in Northfield”?

127 thoughts on “Digging Deeper into the Local Economy”

  1. Bruce,

    With the exception of Ireland I wouldn’t want to live in any of the countries you mentioned. The lifestyle of those places doesn’t appeal to me at all.

    At one point we will reach the point where our ever expanding need for growth will reach it’s boundaries.

    Your and my definitions of quality of live don’t match yours isn’t that in itself a characteristic worth preserving?
    You seem to believe, that a government is designed to provide all these things, that in your opinion provide a “better quality of life”.
    I measure my quality of life by what I can achieve by myself without having to ask government to help me.

    I want to chose whom I support and want to keep as much of what I have earned.
    Don’t I deserve to keep what I earn? When did our elected officials start to believe that what I earn belongs to them, and they are free to tax me at will? So they can throw more money and bailouts and other foolish programs??

    I don’t know where most people work here, but if I had to guess we have a high amount of government or government related people here at this board.
    Which partially explains why they are so willing to part with their hard earned money.

    Do you want government to decide where those borders are or do you believe that this process will naturally find it’s way?
    I am all against trying to squeeze people in to a box that somebody else defines for them.

  2. Peter,
    The last thing I want is for the government or anyone else to squeeze me (or you!) into a box. I don’t long to be taxed more heavily; I just think it’s an option that should be on the table as we seek to create a more just, sustainable society. (By the way, I work in the private sector as a self-employed consultant; my wife, does, however, feed at the public trough as a public school teacher. Is she overpaid? I don’t think so, but that’s a WHOLE ‘NOTHER conversation.)

    You’re completely entitled to your opinion, as I am to mine. Rock on, dude! Vive le difference!!! (You and I might both be surprised at how much we might have in common, BTW.)

  3. Bruce: It is the government’s role to create a sustainable society? Where is that in the Constitution, the Declaration of Independence, or any other document?

  4. David L., I would argue that it’s an appropriate CITIZEN’S role to work and lobby for a sustainable society. If part of accomplishing that goal is electing public officials who will also work toward that end, isn’t that an appropriate function of representative democracy?

  5. Another subtopic that I believe is pertinent here is Malcolm Gladwell’s new book ‘Outliers: The Story of Success’

    http://www.newsweek.com/id/169196

    I haven’t read it (though I am a fan of ‘Tipping Point’), but the review calls it a book that talks about “luck” being a bigger factor in determining who/what succeeds and who fails in our society, in a way ideas and profitable ventures only occur of of circumstance and ‘Geniuses are made, not born.’

  6. David,
    You’re right that the Constitution and Declaration of Independence are silent regarding creation of a sustainable society. However, it seems that any government would be irresponsible to stand by while society goes over a cliff, in the interests of letting the market operate.

    Even Peter concedes (comment #101) that “At one point we will reach the point where our ever expanding need for growth will reach it’s boundaries.” Left to its own devices, the market, with its inherent short-term, bottom-line focus, is virtually guaranteed to send us over the cliff unless citizens, through their elected officials, say “let’s create economical/social policies that ensure long-term (i.e. indefinite) sustainability.” If we wait for the market to recognize that our boundaries have been reached, to use Peter’s terminology, it’s too late to avoid the abyss (e.g. societal collapse).

  7. Tracy: Ross asked if taking back some of “our” agriculture, media, and capital investments is such a radical concept. The answer is “yes” if it means that I want to control things that I don’t own.

    For example, the argument of sustainability in the annexation process was: we have a limited amount of farmland; we need to preserve it; therefore, we should restrict its use. The problem, of course, is that “we” don’t own it; “they” own it.

    So, citizens can and should lobby for what they want, including sustainability. But, sustainability should the the result of good government, not the goal. Fairness (justice) to the farmers requires that they receive market price even if the land is used for “sustainability”. That way, the price of sustainability is shared by all.

  8. Bruce: Government is not a tangible thing; it is just an idea. Government doesn’t stop people from doing stupid things anymore than God stops people from doing stupid things.

    Government can and should offer incentives and punishments to direct behavior even toward sustainability. But, even seemingly good ideas like ethanol can turn out to be monumental failures when the incentives don’t match the financial reality.

  9. David L: Just because the word “sustainable” is not in the constitution doesn’t mean we don’t have a constitutional duty to do it. When the document was written, they didn’t see the human race as being the cause of the “6th great extinction” or as one among various causes of global warming (and related feedback effects that accelerate it).

    Given our current understandings of these, and of the breakdowns of unsustainable systems, it’s easy to see it as related to the preamble:

    “We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”

    – The goal is a more “perfect union,” which allows for future progress.
    – “…establish justice”: Unsustainable systems often lead to unjust consequences, such as paying for cheap meat, milk and vegies by way of hidden health care costs.
    – “…insure domestic tranquility”: Domestic tranquility may be threatened by climate change, as the Pentagon has already planned for possible droughts and food shortages, as well as wars over resources.
    – “…provide for the common defence”: Some of the dangers we defend against include the consequences of our own unsustainable actions.
    – “…promote the general Welfare”: Need we say more?
    – “…secure the Blessings of Liberty to ourselves and our Posterity”: The future of the planet requires sustainability.

    Sustainability itself may not be in the text of the articles that follow, but it’s clearly in the intention of the preamble, which sets the tone; laws to promote sustainability can certainly be made within the framework of that constitution, and in wonderful harmony with the preamble.

  10. “Sustainable” is just an emotional word for left wing politics. On rational level ‘oil’ has so far proven more sustainable than ‘wind’ – at the very least for society. The problem with arguing for ecology over society is that beauty is in the eye of the beholder. Posters here argue that oil has been subsidized so alternatives should be subsidized. I don’t think that is an accurate argument. The government did not have to promote oil with financial incentives; oil was and is an unbelievably economical source of energy. I sense people get religious type fervor over ‘wind’ that hurts rational discussion of its merits. Do I object to a wind verses oil debate on the actual merits, of course not. But a debate that demonizes oil and suggests that wind mill blades are like angel’s wings should be called out as silly. The huge wind installations that real corporations are looking into, where massive amounts of hot water will be created and pumped into the ground for storage sound just as damaging to the environment as oil. Why can’t a larger emphasis be made on conservation of energy technology regardless of the source? Personally, I think conservation technology liberates people from control by the system and neither of two parties that currently control political debate in this country can cotton freedom.

  11. It’s curious but consistently and tiresomely predictable that some folks inevitably, see the words sustainable and sustainability as red flags, and seem unable to get past them without reacting in a violently negative manner, and caricaturizing efforts to work toward sustainability as misguided/ill-informed/people-hating tree hugging. David H.: your opinion that

    “Sustainable” is just an emotional word for left wing politics.

    is a case in point, as is your characterization of comments on this thread as

    arguing for ecology over society

    Here’s the working definition of sustainable (and sustainability) that informs my worldview:

    A sustainable community is one that provides opportunities for its citizens in ways that do not compromise opportunities for future generations.

    Sustainability is a means of configuring civilization and human activity so that

    • society, its members and its economies are able to meet their needs and express their greatest potential in the present
    • while preserving biodiversity and natural ecosystems, and
    • planning and acting for the ability to maintain these ideals in the very long term.

    If that is left wing politics, so be it. If right wing politics is uninterested in working to ensure that we have a world worth living in long-term, I will oppose right-wing politics with every fiber of my being. However, I’m more interested in a politics of getting positive things done than in applying off-putting labels such as left wing and right wing designed to divide people into opposing camps….sigh. Some things seem to never change.

     

  12. You won’t be able to find a person in the USA that would be against sustainability.
    Sustainability is not just a concept of political will it is a natural law. If we don’t think and act on sustainability the planet will force us to do it.

    The discourse on this issue comes from the way it is being used as a political tool to further an agenda that goes beyond protecting our natural resources.

    I am old enough to remember when the rivers were a lot dirtier then they are today and the air was less clean then it is today.
    Back then we didn’t have to use taxes as a way to punish everyday citizen in to compliance by raising taxes. We didn’t raise peoples cost of energy by burning food for fuel or plan to raise taxes via a cap and trade system. We did it because it was the right thing to do.

    The aggressive tone of the extreme eco-nazis has pretty much destroyed any civil conversation on this issue.
    We are readily adopt the mantra of an Eco- Messiah who claims that only he alone can save the world.
    Never mind that he does exactly the opposite of what he preaches and has setup a mutual fund to profit from his prophecy.

    I think we all would be well served to take of our blinders and go back to common sense solutions rather then serving a self serving agenda of an extremist few.

  13. The basic causes of our environmental troubles are complex and deeply embedded. They include: our past tendency to emphasize quantitative growth at the expense of qualitative growth; the failure of our economy to provide full accounting for the social costs of environmental pollution; the failure to take environmental factors into account as a normal and necessary part of our planning and decision making; the inadequacy of our institutions for dealing with problems that cut across traditional political boundaries; our dependence on conveniences, without regard for their impact on the environment; and more fundamentally, our failure to perceive the environment as a totality and to understand and to recognize the fundamental interdependence of all its parts, including man himself.

    —famous left-wing politician Richard Nixon, August 10, 1970

  14. Bruce – “violent” ? What are you going to jail me for questioning “sustainability” like a medieval priest would for questioning “god.” What about the tangible issue of pumping massive amounts of hot water into the ground for energy storage – is this deemed sustainable or not ?

  15. Bruce – your definition seems worthy and solid excepting the part about “configuring civilization” as this implies a command and control system which 1000s of years of history has shown will be corrupted. Who are these high priests that will decide on the configuring and accuse any questioners of being “violent.”

  16. Rob,

    “You quoted :
    the inadequacy of our institutions for dealing with problems that cut across traditional political boundaries”

    Thanks…my point exactly.
    We are in the midst again were a few extremists are trying to push a political agenda rather then ecological agenda.
    Amen to that.

  17. David,
    A thousand apologies for the perhaps ill-advised use of the word “violent.” I have no interest in being a high priest, nor in having to defend myself against being considered an extremist, so I’m gonna bow out of this conversation for now and engage in some more-productive activity.

  18. Thank you Bruce for confirming my point. I guess it’s only a fruitful discussion if we all come to your point of view?
    It’s alright for you to say:

    “If right wing politics is uninterested in working to ensure that we have a world worth living in long-term, I will oppose right-wing politics with every fiber of my being. However, I’m more interested in a politics of getting positive things done than in applying off-putting labels such as left wing and right wing designed to divide people into opposing camps….sigh. Some things seem to never change.”

    But soon as someone questions your motive you get defensive???

    Your above statement does not contribute anything to the by you proclaimed need for unity on this issue.

    It makes guys like me resentful and indifferent to your point of you.

  19. Tracy,

    I agree that it is the CITIZENS responsibility to work for sustainability.
    Unfortunately this issue has been hijacked by lobbyists on both sides.

    Little people like me have no say other than vote.

  20. Bruce – in earnest, I am interested in this issue of pumping heated water into the ground. Is this something that the sustainability movement supports ?, Wants to see large scale experiments with ?, is against ? Or has no position yet ? I hear discussions of the subject but have not seen much research.

  21. I’m not sure how this conversation went to hell in a handbasket so fast but I’m not happy about. Please read our Guidelines page which starts out:

    Our discussion guidelines here on Locally Grown are intended to foster the development of an environment where ideas, information, and opinions are exchanged in an atmosphere of civility, trust, fun, and respect. It is best if you bring a spirit and language of inquiry with you when you visit and restrain your desire to only promote a point of view that is already formed.

     

  22. David H,
    Where did you read where wind turbines were heating and storing the heated water? Iam interested to read about it if you have a link.

    Actually, I’ve been thinking of this scheme (underground thermal storage) for awhile and I believe it to be a viable solution to the intermittency of renewable energy. Unlike batteries which are expensive, short life expectancy, and are generally limited to how fast they can be charged. The wind thermal can be coupled with solar thermal for an additional boost in thermal energy.

    There’s a housing development in Alberta Canada that used the ground itself as a thermal storage unit, the method used is referred to Borehole thermal storage. See link:

    http://www.sterlinghomesgroup.com/drake/energystorage.html

    The ground itself is heated and not the ground water( which would sink the heat away).

    I’ve been thinking that other ways would be to build large insulated underground tanks filled with rock and water to store the heat. This heat could then be used as a local district heating center (see the Sterling Homes link above) , and additionally can be used to regenerate electricity using Organic Rankin Cycle generator as in link below:

    http://www.infinityturbine.com/ORC/Waste_Heat_Turbine.html

    The nice thing, if system is designed right, is this generator will be running 24/7, no more renewable intermittency.

  23. David H to #111,

    I don’t feel that storing heat in the ground (~200deg F) would be bad for the environment when the entire core of the planet is molten rock.

    I am not a subscriber of Global Warming but I am very concerned about Peak Oil.
    Peak Oil is NOT about how much oil is available (RESERVES), but how fast (FLOW RATE bbl/day) can be supplied and how much INPUT ENERGY is needed to make that possible.

    The little publicized annual IEA report on oil supplies should make all take pause and think about what we are doing and where we are going as far as our energy future is concerned:

    http://www.iea.org/Textbase/press/pressdetail.asp?PRESS_REL_ID=275

    Until this report these folks have been very bullish about the future of oil supplies. Their estimate that the current major global oil fields are currently depleting at a rate of 6.7% is pretty stunning number. This rate implies that a year from now, without any new added capacity from new (much smaller) fields that basically the supply of roughly 5.7million bbl/day ( about the amount now produced daily by the US) will no longer be available and every year thereafter another US supply will go offline.

    If true, no amount of energy conservation will be able to keep up with this depletion rate, and no amount of increased drilling will hold this rate in check. The report was talking about $1trillion/yr spending to try to just stay in place.

    It’s not a question about if, but when, oil depletion will become the major issue, which will be the ultimate cap on our infinite global consumption. Energy is the foundation of the modern global economy, and once it begins to fall in earnest so will the global economy. I feel we need to start thinking seriously about local sustainability, what it will look like and how we can get there.

  24. Mike – I’m not against new energy ideas but I am not going to discount the ideas from oil companies in favor of “Nobuo Tanaka” opinion just yet. I mean I know they are all bad men but they have been delivering a gallon of refined gas cheaper than a gallon of milk for a long long time. If peak oil is a huge coming concern then we should easily be able to see this change in energy company’s investment decisions.

    As to holding heated water in the ground, I have mostly heard talk of this from people as a solution to the fact that energy cannot be stored. Wind sort of runs countercyclical to demand so on a hot still day when everyone wants AC there is now wind. The idea sounds interesting but storing enough heated water below ground for say a metroplex of 3 million sounds like one monster load of heated water ~ certainly enough to radically alter the environment.

    My thought has always been since most oil is used in transportation, and since 45,000+ people die every year in cars, and since Detroit is collapsing that maybe the focus should be on safe efficient point to point transportation. The beauty is that efficiency gains in human life will parallel efficiency gains in oil consumption (I’ll posit an estimate that everyone could be moved around safely on 1/25 the oil now consumed for the purpose). I bet setting aside a measly 1/2 billion dollars for prize money would create more radical and unbelievable ideas within a year than anyone would ever predict.

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