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10 Steps to Improving Your Local Economy

Mar 8, 2010

Recently, most of America's industry has been "outsourced" overseas, causing a loss of jobs and the disintegration of hometowns built around factories. Our current recession is an indication that this global economy is not working.
These Ithaca Dollars are only accepted in independent stores in Ithaca, N.Y.

These Ithaca Dollars are only accepted in independent stores in Ithaca, N.Y.

Economist and author Michael Shuman said recently "about 42 percent of our economy is 'place based,' or created through small, locally owned businesses." This means that almost half our economy depends upon small independent businesses that make up the backbone of our hometowns.

These small businesses are what give our town local color and local flavor. They are what differentiate us from every other exit on the highway that has the same six chain stores.

Local businesses are also committed to their hometowns and support the local economy through hiring people in the area, donations to Little League and volunteer ambulance and fire service, and paying local taxes.

The way out of this recession is to build stronger local economies. These Ithaca Dollars shown in the photo are only accepted in independent stores in Ithaca, N.Y.

Shuman estimates that we could expand our national economy to be 70 percent local or more by incorporating these 10 simple steps that will actually save you money in the process.

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What to do:

-- Localize your home! The biggest expense most of us have is our mortgage. Actually, 60 percent of our annual expenses go to shelter. This money often flies out of our pockets and communities and into absentee landlords' hands, or corporate banks in other places. By renting from a local landlord, or buying your own home with a mortgage from a local bank, you can localize this expense. Local banks and credit unions typically have the best rates anyway, possibly saving you money in the process.

Try to find a bank that doesn't repackage and sell loans on the secondary market, which would stop your money from flowing through the community.

-- Drive less! According to Shuman, Americans spend one out of every five dollars on transportation. That amounts to almost $5,000 per year! Until we can start replacing imported oil with locally produced biofuels, our best bet is to drive less.

Using mass transit, bicycling or walking are highest on the list, but not very easy for us rural folks. Use the car sparingly, buy gas from an independent gas station if you can find one, and use a local repair shop you trust.

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-- Eat Independently! Households spend about $2,300 per year on restaurants. Unfortunately, it's mostly fast food chains. This one is a simple matter of choice with very little effort required to find a wonderful independently owned restaurant.

-- Local Arts and Entertainment! Most people opt for a movie at a corporate multiplex at the mall. Enjoy homegrown talent! Visit the small repertory theaters, see a real play instead of a movie. Visit an art show, and buy art from local artists, buy music directly from the bands.

-- Localize Your Health Care! Most of us have health care plans that are far from local, yet two components, high-tech equipment and prescription medications, can be localized. Get your meds from an independent pharmacy, preferably one that also uses local suppliers. If we take better care of ourselves, walking more, eating local, building strong family and community ties, we will reduce our need for the high-tech equipment. Using local midwives instead of OB-GYN's, and naturopaths or herbalists are alternative ways.

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-- Buy Locally Grown! Eating locally, meaning buying fresh vegetables, meats and dairy from local farms, reduces transportation costs and vitamin loss. Farming is one of the few industries that isn't totally outsourced yet. The closer you eat to home, the more you improve your health, your view and your local economy.

-- Localize Electricity! We could save $3,000 per year just by increasing our energy efficiency. Simple things like using compact fluorescent bulbs, improving insulation and having a home energy audit are some ways. Invest in solar hot water through a local provider, and save even more.

-- Give Locally! More than 6 percent of the U.S. economy is nonprofit, according to Shuman. Most of these nonprofits are in the forms of hospitals, universities and churches, but locally we also have arts organizations, environmental groups and many others.

-- Buy Local! In the time it has taken you to read this, Americans have collectively spent $23 million. Shuman says that $16 million of this figure could be spent in small, locally owned stores. How far would $16 million go in your hometown today?

Shawn Dell Joyce is an award-winning columnist and founder of the Wallkill River School in Orange County, N.Y.


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