Local action: a new initiative aims to deglobalize the Bay Area's economy
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In what some experts are hailing as a first for sustainability movements in the United States, a coalition of policy organizations has unveiled a comprehensive campaign to reduce the Bay Area's reliance on global markets in favor of a more locally based economy.
If the plan is embraced by local government agencies and brought to fruition, it could be the first significant reversal of the decades-long march toward globalization, which encourages powerful multinational corporations to exploit cheap labor and transport goods long distances.
The Bay Area is rife with testaments to globalization, from the rusty shells of once prosperous manufacturing plants to the gleaming big-box chain stores filled with cheap Chinese-made clothing and gadgets, from the customer service call answered in India to the foreign parts in our "American made" cars and computers.
Yet at the same time, there are the countervailing forces of localism. For every grocery store stocked with out-of-season produce grown across the world with petrochemicals by big agricultural corporations, there is a community farmers market selling locally grown organic fruit.
Most of globalism's many faces have a local equivalent. Consumers can buy a burrito at Taco Bell or El Toro, a hammer at Home Depot or Cole Hardware, a new shirt from the Gap or a recycled garment from Held Over, and a bicycle assembled at a factory in China or Freewheel Cyclery.
Or on a grander scale, utilities can import kilowatts of energy from a coal-fired plant in Utah or buy wind and solar power generated in the Bay Area, city governments can contract with out-of-state corporations or locals, and financial institutions can push the status quo or value a more diversified (if less profitable) economic system.
The idea of the localization movement is to analyze the impacts of those choices and start a discussion of how local governments can facilitate the creation of an economy that is more sustainable and less exploitive, one that is unique to the Bay Area.
The coalition, which formed in spring 2006, recently released a 30-page report that details the purpose of its campaign and the group's initial strategy for achieving its goals. The report, titled "Building a Resilient and Equitable Bay Area," and a two-page summary are available online at www.regionalprogress.org . More than two dozen organizations have already endorsed the report, including Oakland's and Berkeley's respective sustainability offices.
The coalition's members include Redefining Progress, Bay Localize, the Business Alliance for Local Living Economies (BALLE), the International Forum on Globalization, and the Center for Sustainable Economy. With the exception of the last, which is in Santa Fe, NM, all of the groups are located in either San Francisco or Oakland.
A key feature of the campaign and the reason some experts describe the initiative as unique in the United States is its scope. Efforts to localize individual sectors of regional economies have been under way for years. Berkeley, for instance, is considered a leader in the growing movement to shift from a food system dominated by a handful of giant agribusinesses propped up by federal crop subsidies to a system that relies more on local production and procurement of food. Similarly, many areas are considering ways of creating and encouraging the use of alternative and local energy sources to limit dependence on imported oil.
What sets the new Bay Area campaign apart from other localization initiatives is that it seeks to effect change across several sectors of the region's economy simultaneously. It hopes to do so, in part, by achieving the cooperation and coordination of businesses, government officials, and community leaders at the federal, state, and local levels.
The report defines economic localization as "the process by which a region ... frees itself from an overdependence on the global economy and invests in its own resources to produce a significant portion of the goods, services, food, and energy it consumes."
In an interview with the Guardian, John Talberth, one of the report's primary authors and a PhD economist at Redefining Progress, stressed that economic "isolationism is not the goal of the campaign."
Instead, he said the goal is "reestablishing an efficient balance between imports and products made locally for local consumption." In other words, even if the Bay Area localizes its economy according to the strategy proposed by the coalition, many products would still be imported. The economy would, therefore, remain dependent on global markets but much less so than it is now.
And that could have significant ramifications for the region, humans, and the planet.
The report acknowledges the benefits of globalization, which has kept consumer prices low and forced corporations to become more efficient. But, the authors note, "it has come at a steep price."
That price includes "a loss of economic diversity, declining real wages and working conditions, increasing inequality, offshoring of environmental degradation, and a concentration of financial capital and economic decision-making in global corporations." The changes have left people "vulnerable to inevitable supply and price shocks in the post peak oil era."
In other words, perhaps global capitalism is reaching the point of diminishing returns. The coalition posits that the antidote is localization, which has great potential "for creating a wider range of local jobs and institutions, shielding our economy from global shifts, increasing the diversity and quality of goods and services we consume, distributing economic benefits in a more equitable manner, and protecting our environment."
The Bay Area is the focus of the coalition's campaign because its member organizations are located here and because those members believe there is already a great deal of public support in the region for such a project.
Kirsten Schwind, programs coordinator at Bay Localize, told the Guardian there was an "overwhelmingly positive response" to a recent project targeted at supporting local food producers. Both Schwind and Don Shaffer, executive director of BALLE, cited Oakland's Kaiser Permanente as an example of the increasing number of businesses that are altering their buying habits to favor local sellers. Shaffer also said the Oakland and San Francisco school boards are buying locally produced food and the Oakland City Council is setting targets for local energy production.
But even if much of the Bay Area is receptive to the idea of economic localization, other groups are not. There remains a powerful current of support in government, business, and academia for a predominantly global economy.
Traditional economists, for instance, are reflexively hostile to localization initiatives because such projects do not conform to the concepts embodied in so-called free-trade and free-market theories.
The Guardian interviewed three UC Berkeley professors who do not agree with the report's view of globalism. None of the professors had read the report despite the fact that the Guardian forwarded it to them before the interviews but all said they were familiar with the basic ideas behind localization.
Each expressed a knee-jerk hostility to the concept, but once they began discussing the details of localization, they agreed with the coalition on many points. And the professors' initial objections to localization including the notion that it would return economies to a more primitive state and that it is isolationist in principle were mostly rhetorical and unrelated to the coalition's specific recommendations.
Two of the professors Daniel M. Kammen, who teaches in the Energy Resources Group as well as the Goldman School of Public Policy and the Department of Nuclear Engineering, and David Vogel, who teaches in the Haas School of Business, the Political Science Department, and the Goldman School were immediately opposed to the idea of a comprehensive localization strategy.
Vogel, in particular, seemed at first to make light of economic localization, calling it a "romantic notion that periodically resurfaces," and more than once asked laughingly whether the coalition "expects Bay Area residents to watch only movies made in the Bay Area."
Another professor, Lee Friedman, a PhD economist who teaches at the Goldman School, said, "Globalization is a lot like the problem of gays in the military: mend it, don't end it."
But Friedman likes the idea a central one in the report of including all costs in the price of goods. That's particularly true of environmental costs. This might raise the price of electronics to pay for their disposal or of gas-guzzling vehicles to pay for their global-warming impacts both ideas being explored by the European Union.
All three professors also had some very positive things to say about economic localization. Kammen, like Friedman, strongly believes that communities should pursue local and low-carbon energy production because the environmental impact associated with producing in a foreign country and shipping to the United States is far greater than that of local production.
"Localization advocates are making some excellent points that people ought to pay attention to," Friedman said. He agreed the Bay Area imports too much of its food. Vogel expressed a similar sentiment, saying that buying locally is a "great idea." He also said localization could help to address urban sprawl. By the end of the interview, Vogel softened his initially dismissive attitude toward localization, deeming "aspects of it interesting and attractive."
Talberth and other coalition members say challenging the economic concepts supporting globalization like those taught by Friedman and most other economics scholars is a central task of their campaign.
Critics of traditional economic theory have for a long time been saying that too many economists base their research and resulting recommendations on economic models that bear little resemblance to the way the real world operates.
Although economists often bristle at that criticism, Friedman has acknowledged to his students the flaws in prevailing economic models but said, "Until someone comes up with better models, people shouldn't complain about the existing ones."
Yet Hazel Henderson, a coalition member and the author of Beyond Globalization, and Talberth say alternatives to the current models are well established and have been around for years. They criticize the fact that economic growth is measured by the gross domestic product (GDP), a simplistic calculus that doesn't take into account economic activity that is harmful to people or the planet.
They prefer new indicators, like the genuine progress indicator (GPI), that account for costs and benefits the traditional indicators do not factor in. The report calculates the GPI for each of the Bay Area's nine counties. The European Union has already adopted this kind of alternative measure of an economy's well-being.
Engaging the public is the coalition's next big goal. Despite the overall support that Schwind and others say already exists in the Bay Area for localization, they admit there are challenges to mobilizing citizens.
"It's well documented that people tend not to act unless there is a crisis," Shaffer said. But he also said that "giving people Armageddon scenarios" will not work because such stories are depressing and, more importantly, "people are too busy to think comprehensively about that sort of thing."
Instead, Shaffer and Schwind said the coalition plans on putting out a "positive, hopeful" message focusing on the benefits that will accrue to individuals and communities if they adopt localization.
Beyond getting the public involved, the coalition is encouraging local, state, and federal government organizations to conduct studies assessing the challenges and true costs of relying so heavily on global markets. Talberth acknowledged that:
"Getting [those] assessments done is a big challenge."
Ultimately, the coalition would like the Bay Area to serve as a model of localization for other areas in the United States. Shaffer said the group is "not looking to put a formulaic stamp on other regions" but hopes instead that such places will be influenced to adopt localization measures in light of the Bay Area's success.
Shaffer said the food and energy sectors, along with retail, are already understood well by consumers, at least intuitively. So he predicts the coalition could achieve significant results in those sectors within five years. Spreading those advances to other parts of the economy could take another 10 years after that.
Shaffer, Talberth, and Schwind all said that change is coming whether people want it or not, mostly due to global warming. So they argue for the Bay Area to embrace change now and begin to make the needed changes gradually, before they are painfully thrust upon us. We can localize our world or simply accept whatever the global economy dishes out. *