Oregon Rural Action’s Annual Meeting: Making the Shift

Building a Vibrant Local Economy Amidst the Broken Global Financial System

La Grande, Oregon October 9, 2010

My Story

From Wall Street to Grasslands and the Capital Institute

“I once said greed was good… now it seems that greed is legal.”

- Gordon Gekko

http://pricetags.files.wordpress.com/2008/04/800px-london_millenium_wobbly_bridge1.jpg

Bridging the gap between mainstream finance and the new economy movement.

the dilemma of compound growth

UNSUSTAINABLE

Economics ignores laws of thermodynamics

Economics ignores laws of thermodynamics

Anyone who thinks you can grow the economy forever on a finite planet is either a madman or an economist!

- Kenneth Boulding

Symptom: financial crisis

Problem: unsustainable economic system

Sustained economic growth: oxymoron?

The world is full…but nothing is changing.Planetary

Boundaries

FACTIf everyone were to live like Americans we would need 5 Earths

http://passmethemalkplease.files.wordpress.com/2008/04/gursky.jpg

So what? http://www.oneinchpunch.net/wordpress/wp-content/uploads/2007/12/crude-oil-spill-clear-up.jpg

http://www.oneinchpunch.net/wordpress/wp-content/uploads/2007/12/crude-oil-spill-clear-up.jpg

Financial Crisis crisis

Population Crisis

http://cdn5.mattters.com/photos/photos/1370157/crowded_train_stations_in_china_10.jpg&imgrefurl

World 6,826,859,514

http://2.bp.blogspot.com

/_JSpbgoKp8LA/SjF4960b8qI/AAAAAAAAFVg/B4CaO

wK2yTk/S1600-R/w

orldpop_2009_lowerfertility.gif

Climate Crisis

http://www.katrina.noaa.gov/helicopter/images/katrina-new-orleans-flooding3-2005.jpg

Hurricane Katrina, 2005

Water Crisis

http://www.naturalbuy.com/wp-content/uploads/2008/08/water-crisis.jpg

Peak Soil

In past 40 years, 30% of farmland has become unproductive

Peak Oil

Energy Crisis

http://cdn.content.compendiumblog.com/uploads/user/206a9a2b-627f-446d-b836-03b603106274/08ef70d7-7014-48c5-b9a5-7d322cf1fccc/Image/caa79888d3200de8c9ed8dbfb0bfd8c4.jpg

“Nothing has changed….oil and natural gas are essential to our way of life.”

- Jack Gerard, American Petroleum Institute

“Nothing has changed….oil and natural gas are essential to our way of life.”

- Jack Gerard, American Petroleum Institute

So if we know the problems,

why aren’t we changing?

Economic Efficiency

Economy

FinancePlanetPlanet

What’s wrong with this picture?

Sustainability

Optimum

Efficiency

100%

0%

Resiliency

Collapse of Financial System

Collapse of Financial System

Source: Bernard Lietaer, 2008

Biosphere

Economy

Finance

Sustainability in Complex Systems

In the wake of one of the World’s greatest economic crises,

“sustainability” is unable to compete with mainstream perceptions of financial reform

http://www.dirtyday.com/wp-content/uploads/2009/06/20070626231520_dsc_1152.jpg

2005 2006 2007 2008 2009

Public Opinion on Priority: Sustainability vs. Economic Growth

sustainability

economic growth

Opi

nion

on

Prio

rity

GALLUP POLL

http:

//w

ww

.obs

erve

r.com

/200

9/m

easu

ring-

publ

ic-o

pini

on-

envi

ronm

ent-

and-

sust

aina

bilit

y-ho

w-c

onve

ntion

al-w

isdo

m-

gets

-way

Look where the money’s going:

http://www.eli.org/pdf/Energy_Subsidies_Black_Not_Green.pdf

Climate Protecting

Climate Damaging

Finance is the fuel source…

what we feed GROWS

Reform

Transform

Harnessing Capital.

A world in which finance serves a just, resilient and sustainable economic system.

Driving capital upstream

http://3.bp.blogspot.com/_o0s746IzxZ

Q/T

JwM

EtnP

vsI/AA

AA

AA

AA

AW

o/lX-2e-w

PZ

zo/s1600/upstream

.jpg

Building a Vibrant Local Economy

taking action

http://pixdaus.com/single.php?id=131088

”. . . production from local resources for local needs is the most rational way of economic life...”

- E. F. Schumacher, Small Is Beautiful

Place based diverse economies: building resiliency

Tribal? Portland Detroit

Sustainability

Optimum

Efficiency

100%

0%

Resiliency

“Economies of location often override and outdo economies of scale.”

- Jane Jacobs, The Nature of Economies

Farmer’s Diner“increasing the economic vitality of local agrarian communities”

Decreasing distance from farm to plate, increasing profit for local farmers

Grasslands, LLC: Holistic Management

Restore ecological function, revitalize rural communities. Profitably.

“When you improve the quality of the land in an ecological sense, the profitability follows.”

How to Save the Grasslands: Bring in More CattleBy JUDITH D. SCHWARTZ Tuesday, Sep. 07, 2010

Grasslands, LLC

Local CAN scale

• Founded in 1956• Philosophy: Co-operation | Participation | Social Responsibility | Innovation

• 4 Sectors: Finance, Industry, Distribution and Knowledge

• 85,000 people, 256 companies, 15 Billion Euros in turnover

Basque Country, Spain

Local CAN scale

• “Import replacement” activity (Jane Jacobs)

• Employee-owned, for-profit companies: greenhouse produce, laundry service, solar energy

• Based locally, hire locally: permanent green jobs

• Workers earn a living wage, build equity as owners

• Circulate money within community - 5:1 multiplier

Cleveland, OH

Local Community Capital

Complementary Currencies: building resiliency

• Thousands of examples, over 600 in Japan alone

• Numerous countries

• Highly diverse ecosystem

• Multiple “schools” of thought

Sustain Optimum

Efficiency0%

Resiliency

Complementary Currencies: proven models WIR Bank

• Founded in 1934, Switzerland

• Response to stock market crash in 1929

• The word for “we” in German > economic circle is also a community

• Has grown from 16 to 62,000 members

• Swiss Franc 1.6 Billion annual turnover

Complementary Currencies: time banks

• Building the Core Economy

• Time really is money

• Strengthening communities through reciprocity

• “We are all assets”

Complementary Currencies: emerging models

BerkShares• A local currency for Southern

Berkshire region of Massachusetts (pop. 19,000)

• Defines a trading area, an economic footprint

• Distinguishes the local businesses

• Builds loyalty

• Encourages community self-reliance and wellbeing of community

“A good community, as we know, insures itself by trust, by good faith and good will, and by mutual help.

A good community, in other words, is a good local economy.”

-Wendell Berry

What is the purpose of capital?