RE: [Futurework] Local living economies

[Karen Watters Cole]

Bill wrote: Harry, Wal-Mart is cheap and I do shop there. Something about the end of small stores and the fact that Wal-Mart and others use basically a temporary work force that will have to live totally off of SS at the end it would appear.   There are other points to consider.  As the Institute for Self-Reliance (www.islr.org) and The Hometown Advantage (Stacy Mitchell) document, communities dominated by corporate chains are worse off economically than are diverse economies maintaining small-scale, locally owned enterprises.  Here is Mitchell’s list of why, paraphrased by yours truly: 1. Jobs and taxes. A new Home Depot will not sell anymore hammers and nails than 3 local hardware stores – it’s supply and demand. But because the Home Depot will eventually force the local stores to decline, all the revenue exchange goes out of town rather than staying local.  For every 1 job that a Wal-Mart provides it takes away 3 previous jobs.   2. Public costs. Land use patterns accommodating big corporate retail contribute not just to sprawl but the costs of additional roads, sewers and fire and police protection. This adds to the costs local taxpayers are already paying without adding to the revenue base when corporations have received lucrative tax incentives.  The community bears the brunt of the investment and gets a small return in the long run.   3. Multiplier effect.  Indie retailers keep their profits local, and tend to trade goods and do business with other local operations, such as accountants, lawyers, advertisers, printers, and of course, local banks.  Chain stores not only distribute from giant national warehouses but produce their advertising and do their other support tasks outside the community in which they build.  Sending your consumer dollars to Arkansas (much less offshore banks- kwc) is not good for community sustainability in the long term.   4. Fewer Choices.  Consolidation of buying patterns reduces choices and the range of products available to the consumer.  You can see this on your grocer’s shelves when mega buyers demand more shelf space or at the bookstore where one Barnes & Nobles is just like every other in terms of selection. (What about local culture and color? – kwc)   5. Monopoly Prices.  Surveys found that prices vary significantly from one major chain outlet to another and are higher in areas where the local competition has been eliminated.  This includes Wal-Mart and Home Depot.  (Note lawsuits where unfair business practices are proliferating – kwc)   6. Long-term Commitment.  Local merchants are residents of the communities they invest in, it’s where they pay their taxes and raise their children, whereas global chains are highly mobile.  In addition to demanding tax incentives to come into a community, when they leave with changing economic winds they leave behind large properties not well-suited to other development, and in fact often hold their leases for years to keep competitors from coming in, so that vacant big box stores are now a common blight – by itself, Wal-Mart has almost 400 empty stores across the US.   7. The Big Picture.  Economic research being gathered shows that cookie cutter developments lessen a community’s appeal to entrepreneurs and skilled workers and in the long run reduces prospects for new investments and jobs.    Too many of us for too long have assumed that bigger is better, that the liabilities are offset by the advantages, or this is just “the price of progress”.  Aside from the environmental and social/civic costs to the community when local businesses are displaced, there is the even broader issue of democracy and sovereignty, since large corporate chains are wielding their assets long-distance.  What needs to be addressed here, those who are studying this seem to be saying is, level the playing field with public policy.  For those of us in industrialized countries staring at sprawl and closed businesses with high unemployment, we should be addressing the rules of doing business at the local level more intelligently and aggressively.  I am a cultural Globalist but want to see local businesses have as much given to them as the big corporate houses.  Who needs a monoculture?  It’s all about balance and moderation.  – KWC   Also see Failed Empire, a four part series in the Buffalo News concerning enterprise zones and tax incentives http://www.buffalonews.com/editorial/20030608/1048744.asp  or contact me offline for a compiled Word document.