A Boost for the Worker-Owned Economy: A New Measure Will Make it Easier for Retiring Owners to Sell Their Businesses to Employees—and Save Jobs Into the Bargain

by Fran Korten, Yes! magazine: https://www.yesmagazine.org/new-economy/a-boost-for-the-worker-owned-economy-20180925

Photo by Ian Spanier/Getty Images

Business owners looking to sell their companies to their employees just got a helping hand from the federal government. It’s the first such measure that’s passed Congress in more than 20 years.

Tucked into the omnibus National Defense Authorization Act signed by President Trump in August 2018 was language directing the U.S. Small Business Administration to help retiring owners sell their businesses to their employees, either as a worker cooperative or as an Employee Stock Ownership Plan.

The measure was backed by an array of nonprofit advocates of employee ownership, including the ESOP Association, the National Urban League, the American Sustainable Business Council, and the U.S. Federation of Worker Cooperatives. According to Melissa Hoover of the nonprofit Democracy at Work Institute, it is the first federal legislation ever to explicitly name worker cooperatives as an SBA priority.

The help appears to be timely, as retirement looms for a “silver tsunami” of business owners. According to the Harvard Business Review, 2.3 million companies are owned by baby boomers, half of whom are expected to retire in the next 10 years. Those companies employ 25 million people.

As that wave of retirees breaks, business owners don’t have many options. Most do not have children who want to run the business, according toJoseph Blasi and Douglas Kruse, professors at the Rutgers School of Management and Labor Relations. Studies show that many will simply close up shop, with their employees losing their jobs. Some may sell to a competitor such as another local company, a larger publicly traded corporation, or a private equity fund—options that also can trigger job losses.

“That makes selling their businesses to the workers who helped create all the value in the first place one of the best options available,” Blasi and Kruse wrote in The Conversation. “It not only helps secure the owner’s retirement but also leaves behind a legacy in the local community.”

The SBA sets the legal standards for what qualifies as a small business, and the standard varies by industry.

The new federal law directs the SBA to use its nationwide network of nearly 1,000 Small Business Development Centers to educate owners about selling to their employees. One obstacle, however, is that owners commonly want or need an immediate cash payment, which employees can rarely afford.

The law addresses that problem by authorizing the SBA to use its 7(a) loan guarantees for such buyouts. The SBA does not make the loans, but its guarantees mean that intermediaries such as banks are much more willing to make the loans. For 2018, Congress authorized the SBA to guarantee up to $28.5 billion for those loans.

Hoover cautions, however, that despite the law and loan guarantee authorization, “we can’t assume employee ownership will be a priority for the SBA. We must help make it a priority. The legislation is well-written, so now our work is to support the implementation to make sure it meets our needs.”

In 2016, the Democracy at Work Institute convened a Workers to Owners collaborative to expand the number of providers assisting with employee-to-owner transitions. Hoover noted, “now the national network is well-positioned to coordinate efforts in implementing the new law.”

Marjorie Kelly of the nonprofit Democracy Collaborative has found that retiring owners are often concerned about their employees losing their jobs. She has cited Galfab, a company that makes waste-hauling equipment in rural Indiana, as an example of a company that made a successful transition to employee ownership.

“Taking care of all the employees was foremost in our mind,” CEO Jerry Samson said when he announced the sale of the company to his employees. Kelly said that Samson decided not to take the highest bid he received for the company because he didn’t want the company sold and moved to some other place, with all those people losing their jobs.

Employee ownership is viewed by many advocates as a fundamental building block for a just economy because workers can have a say in the company’s management and share in the benefits of its success. A growing body of data supports the advantages for workers. A study from the National Center for Employee Ownership reveals that in the last recession, employee owners were four times less likely to be laid off, have two and a half times more money in their retirement accounts, and receive 5 percent to 12 percent more in wages than those in comparable non-employee-owned companies.

That information, alongside a growing concern with economic inequality, is spurring bipartisan interest in employee ownership. U.S. Sen. Kirsten Gillibrand, (D-New York) who introduced the employee-ownership bill in the Senate, had three Republican and three Democratic co-sponsors.

“There’s a reason employee ownership has been favored by people as diverse as Ronald Reagan and Bernie Sanders,” Kelly said. “It works, both as a business proposition and as a pathway to a more democratic economy that works for everyone.”

The bipartisan enthusiasm is significant, Kelly said. “We have the opportunity to bend the curve of history. We can watch these 2 million baby boomer-owned businesses close or be absorbed by big companies, with the accompanying layoffs and job loss. Or we can have a major national commitment to moving these companies into employee ownership, reducing inequality, spreading asset ownership, and rebuilding the middle class.”

One form such a government commitment could take is a much larger loan-guarantee program for employee ownership, similar to federal home loan programs. This could double the number of employee owners in a decade, from 14 million today to 27 million.

“After World War II, we made a commitment to broad-based home ownership. We can now do the same for enterprise ownership,” Kelly said.

Against Civility: Why Habermas Recommends a Wild Public Sphere

by Steven Klein, Aeon: https://aeon.co/ideas/against-civility-or-why-habermas-recommends-a-wild-public-sphere

Demonstrators in Madrid, Spain, in 2014. Photo by Sergio Perez/Reuters

Have we become unreasonable? In democracies around the world, anxious commentators exhort their fellow citizens to be more open-minded, more willing to engage in good-faith debate. In our era of hyperpolarisation, social-media echo chambers and populist demagogues, many have turned to civility as the missing ingredient in our public life.

So, how important is civility for democracy? According to one of the greatest theorists of the democratic public sphere, the German philosopher Jürgen Habermas, not very. Habermas is deeply concerned with protecting our ability to solve problems through the use of reason. Yet he believes that democracy is best served when the public sphere is left open, anarchic and conflictual.

For Habermas, the function of public debate is not to find a reasonable common ground. Rather, the public sphere ‘is a warning system’, a set of ‘sensors’ that detect the new needs floating underneath the surface of a supposed political consensus. And if we worry too much about civility and the reasonable middle, we risk limiting the ability of the public sphere to detect new political claims. To get those claims on the agenda in the first place often requires uncivil and confrontational political tactics. 

Habermas’s vision of politics focuses on the power of a wild public sphere. His great fear, one he expresses already in his habilitation thesis in 1962, published in English as The Structural Transformation of the Public Sphere, is that large-scale, formal political and economic institutions are increasingly shutting themselves off from public criticism. Habermas traces the development of the idea of the critical public in 18th-century Europe, one that would hold state power accountable through the use of reason, and then its decline in an era of public-relations management focused on minimising the role of the public in political decision-making. While Habermas has been accused of romanticising the European Enlightenment, his goal was to draw attention to the stark gap between the ideals of the critical public and the reality of political and social domination.

Like other individuals associated with the Institute for Social Research in Frankfurt, Habermas has always been guided by the hope of creating an emancipated society – one where the use of political, social and economic power can be fully justified to those potentially affected. To this Frankfurt School ideal, Habermas adds an insight that goes back to Aristotle – that the central human capacity is language. The fact that we can understand one another, Habermas argues, means that we are committed to using reason to resolve disputes. In our day-to-day life, we have to continuously use language to organise our lives and make plans – instances of what Habermas in 1981 called ‘communicative action’.

Habermas thinks this has radical consequences. In all these instances, we accept, just by entering into the continuous flow of communication, that the only thing that should count are reasons that everyone accepts. Habermas’s critics point out that, in the real world, social differences in power affect whose voices are heard and whose ideas are recognised in all deliberation. But this point is not incompatible with Habermas’s insights. From his early work, he has seen reasoning as a fundamentally social practice, one that must always include moral and political questions. Bringing to light these subtle forms of power and exclusion helps to realise the ideal of rational enquiry.

What follows politically from Habermas’s theory of communication? Again, one possibility is to find some way to make people live up to an ideal of disinterested, civil deliberation. In the face of increasing polarisation and the potential breakdown of the rules of the game, we should search for some way to restore the underlying norms of mutual forbearance that ensure politics does not descend into civil war. But this is hardly the direction in which Habermas goes. It’s not that he then prizes incivility in and of itself. Rather, Habermas worries that a public sphere shackled by excessive regard for the norms of deliberation and rational debate loses its essential function. And that function is to bring to light questions, issues, concerns and needs that are currently invisible to political leaders and the larger public. 

In Between Facts and Norms (1992), he argues that ‘liberal misgivings about opening up an unrestricted spectrum of public issues and topics are not justified’. Rather, because of its ‘anarchic structure’, contestation in the public sphere can enable the perception of ‘new problems’ and help to overcome ‘the millennia-old shackles of social stratification and exploitation’.

Confrontation, protest and incivility are all components of deliberative politics as Habermas understands it. These forms of conflict, of refusing existing norms and institutions, are what bring to light whether those institutions and norms can survive rational scrutiny. Habermas goes so far as to call the ability to withstand and even celebrate civil disobedience the ‘litmus test’ for the maturity of a constitutional democracy. 

Even as Habermas has a famously ambitious understanding of our capacity for the collaborative search for truth, his is an activist’s view of politics. Consensus is not the highest good. Rather, the possibility of a society based on rational consensus becomes visible only in moments of dissensus, when the failure of existing norms is unmasked. Enlightenment comes about when social groups show that the dominant social organisation fails to take into consideration their legitimate claims and concerns. This is why Habermas is clear that he is interested, not in rational political communication as such, but ‘the history of its repression and re-establishment’.

Habermas’s recent work has focused on the fate of European integration, of which he is a prominent defender. This activist current in his thought has receded as he has worried more and more about the lack of long-term political vision on the part of Europe’s leaders. Yet he has also more recently come to recognise the dangerous failures of those institutions to produce their own legitimacy. The more those institutions, such as the European Union, insulate themselves from the unruly forces of the public sphere, the more they provide ammunition for whoever can claim to speak on behalf of a suppressed public opinion. Large-scale political institutions, from the European Union to the modern administrative state, approach politics as a set of management problems, best solved without extensive input from a potentially recalcitrant public.

Democracy, according to Habermas, requires a vibrant political sphere and political institutions that are able to respond to and incorporate the energy that arises from debate, protest, confrontation and politics. Perhaps it’s not citizens who have become unreasonable. Rather, their leaders have too long refused to listen, instead treating the public as nothing more than a periodic reservoir of votes, an obstacle to be managed on the path to smooth, technocratic governance.

A Community Fix for the Affordable Housing Crisis

by Peter Mares, Swinburne University of Technology, The Conversation:  https://theconversation.com/a-community-fix-for-the-affordable-housing-crisis-102840


Caggara House in Brisbane caters for low-income residents aged 55 and over who previously lived alone in state-owned houses that were too big for their needs. UDIA Qld/Facebook

Jeannie loves her apartment. It has a separate bedroom, a small bathroom, and an open-plan kitchen, lounge and dining area. It’s compact, but sliding doors open onto a generous balcony to create a larger living space. Jeannie often takes her meals on the balcony, where she can sit surrounded by pot plants and enjoy a view across houses with leafy backyards.

Jeannie’s three-year-old apartment is one of 57 single-bedroom units in Caggara House, a five-storey affordable housing development. It’s in a quiet street in Brisbane’s Mount Gravatt, within easy reach of shops, a medical centre, cafes and public transport.

Jeannie has spent much of her life in public housing on Brisbane’s south side. She brought up her three children in a three-bedroom commission home in nearby Holland Park.

After they had all flown the nest she downsized to a two-bedroom townhouse in Annerley. “It was more central,” she says, “just five to ten minutes from the city, which was good when I was working on call as a casual.”

Eventually, though, getting up the stairs became a problem, and Jeannie felt a bit unsafe living at ground level. At Caggara House there is a security entrance, a lift to her third-floor apartment, and wide passageways and doorways, so it is both safe and easy to navigate for someone with limited mobility.

Caggara is split into two buildings with a landscaped garden in between to give the complex a “green lung”. There is a shared barbecue area, a communal laundry, and a common room for parties, meetings and exercise classes. The development has won prizes for an energy-efficient design that provides for both privacy and social interaction.

Yet the real innovation is in the concept — it provided well-located, high-quality housing for low-income residents aged 55 and over, while freeing up resources to add to Brisbane’s overall stock of affordable housing. This might sound like a magic pudding, too good to be true, but Caggara’s residents previously lived alone in state-owned houses that were too big for their needs. Those houses were worth about A$500,000 each. It cost a little more than half that much to build each of the units in Mount Gravatt.

In this way, an investment of A$15 million in Caggara freed up A$25 million worth of assets that could be put to better use, either by accommodating families on the waiting list for social housing or by being sold to raise capital for new buildings.

Caggara House was created for former public housing tenants over the age of 55.

Community housing pioneers around the country

Caggara House is an initiative of the not-for-profit Brisbane Housing Company. It’s a provider of what is often called community housing, to distinguish it from the public housing supplied by state authorities (even though they serve a common client base of low-income tenants). Since it was set up in 2002, BHC has built 1,300 affordable rental dwellings and earned the same AA- credit rating as the Commonwealth Bank.

Housing First (previously the Port Phillip Housing Association) is another innovative community-housing provider. It has 1,200 dwellings scattered around Melbourne. And, like BHC, it forms strategic partnerships with private developers, other community organisations, and all tiers of government to build energy-efficient homes with low running costs.

In Sydney, affordable housing provider BlueCHP has a portfolio of 1,600 properties. In November 2017 it opened Macarthur Gardens, a mix of apartments clustered in three towers close to Macarthur Railway Station, Macarthur Square Shopping Centre, and Western Sydney University. BlueCHP manages 56 of the dwellings as below-market rentals for low-income households and is selling the other 45 to help finance the project.

Macarthur Gardens is the largest residential complex in Australia built from cross-laminated timber. BlueCHP was the first developer in New South Wales to use this cost-effective, environmentally friendly technology.

In theory, state housing authorities could innovate like the Brisbane Housing Company, Housing First and BlueCHP. In practice, this rarely happens. Governments tend to be overly cautious in a sector that is crying out for flexibility. David Cant, who was chief executive of BHC for its first 15 years, says:

Not-for-profits can take risks. They can work quicker and smarter.

Community housing providers also “know their residents and know their geography”, Cant adds.

Australia has a pressing need for more social and affordable housing. More than half of all low-income tenants in the private market spend at least 30% of their disposable income on rent (and often much more than that). This can lead them to skimp on essentials like food, heating, transport, health care and schoolbooks. In the long term this sort of rental stress can damage physical and mental health, stunt educational attainment, and limit opportunity.

Australia can learn from UK housing providers

Cant thinks the best way to reduce rental stress is to build up the community housing sector, even though it currently provides less than 1% of all Australian dwellings. He is confident this can be done, based on 25 years working in Britain.

Before the Thatcher government sold off council houses in the 1980s, local government was the largest and most established provider of low-cost rental dwellings in Britain. Today, housing associations are more significant: 170 individual housing associations own 2.49 million homes – more than 10% of all housing in Britain. Local government now accounts for just 7%.

Oona Goldsworthy, chief executive of the Bristol-based not-for-profit housing association United Communities, says the sector matured relatively quickly. On a visit to Australia to she told me:

Housing associations in the United Kingdom grew out of an ideological and political push that the state is not necessarily the best provider of housing.

The view was that smaller organisations that were closer to the community could do a better job. Goldsworthy says British housing associations were able to borrow proactively, capturing a relatively small amount of public subsidy and matching it with lending from other sources. That’s exactly the sort of agility that gives community housing an edge over public-sector providers in Australia.

In the 2017 federal budget, the then treasurer, Scott Morrison, announced two measures designed to enable not-for-profit associations to build more housing: the National Housing Finance and Investment Corporation and an affordable housing bond aggregator. Together, they are designed to make it easier and cheaper for housing providers to borrow money by acting as a bridge between community-housing providers and superannuation funds.

While community organisations can and do borrow from banks, each loan must be separately negotiated. Super funds won’t deal one on one with individual providers in this way, so the NHFIC aims to offer them a standardised, rated investment product.

Since it has the backing of both Labor and the Greens, the NHFIC should survive any change of government. Yet the most important tool for repairing housing in Australia is still missing — a substantial amount of government money.

Cant, who was recently appointed to the NHFIC board, says poor people are generally reliable rent-payers because they know housing underpins the rest of their lives. Offered a deal along the lines of “be a good neighbour, pay your rent and you can stay here as long as you like”, they will grab it with both hands and enjoy a sense of pride and ownership that is indistinguishable from an owner-occupied home. Yet the rent they can afford to pay is not enough to cover the cost of building and maintaining community housing. Cant says:

If you want to house people on lower incomes then you have to find a bit of a subsidy.

The holy grail of superannuation funds investing in affordable housing will not be achieved unless government tops up the rents paid by low-income households to generate an acceptable rate of return.

Piers Williamson is the chief executive of the Housing Finance Corporation — Britain’s equivalent to NHFIC — and has been advising the Australian government on setting up the NHFIC. He told the tenth National Housing Conference in Sydney that Britain’s affordable housing model was underpinned by £45 billion (A$75 billion) in grant money. “Grants are one of the things missing over here,” he said. “Subsidised housing requires a subsidy.”

Australia badly needs more rental accommodation that does not leave low-income tenants living in stress. The only proven way to increase the supply of social and affordable dwellings is to increase public investment in the sector — in other words, to spend more taxpayers’ dollars.

Why should wealthier Australians agree to subsidise the housing of poorer Australians through the tax system? For David Cant, social justice is reason enough.

As a nation, we are sleepwalking into inequality. The settings we have got are dividing the community.

As housing inequality worsens it will touch more and more people. One day it could be an old friend, a sibling, a child, or a parent facing housing troubles. One day it could be you or me.

---

Peter Mares, Adjunct Fellow, Centre for Urban Transitions, Swinburne University of Technology
This is an edited extract from No Place Like Home: Repairing Australia’s Housing Crisis, published by Text on September 17.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

What a Society Designed for Well-Being Looks Like: Economic Justice Goes a Long Way Toward Improving Mental Health Up and Down the Socioeconomic Ladder

by Tabita Green, Yes! magazine:  https://www.yesmagazine.org/issues/mental-health/what-a-society-design-for-well-being-looks-like-20180912

Image: Mark Airs / Getty Images

In early June of this year, the back-to-back suicides of celebrities Anthony Bourdain and Kate Spade, coupled with a new report revealing a more than 25 percent rise in U.S. suicides since 2000, prompted—again—a national discussion on suicide prevention, depression, and the need for improved treatment. Some have called for the development of new antidepressants, noting the lack of efficacy in current medical therapies. But developing better drugs buys into the mainstream notion that the collection of human experiences called “mental illness” is primarily physiological in nature, caused by a “broken” brain.

This notion is misguided and distracting at best, deadly at worst. Research has shown that, to the contrary, economic inequality could be a significant contributor to mental illness. Greater disparities in wealth and income are associated with increased status anxiety and stress at all levels of the socioeconomic ladder. In the United States, poverty has a negative impact on children’s development and can contribute to social, emotional, and cognitive impairment. A society designed to meet everyone’s needs could help prevent many of these problems before they start.

To address the dramatic increase in mental and emotional distress in the U.S., we must move beyond a focus on the individual and think of well-being as a social issue. Both the World Health Organization and the United Nations have made statements in the past decade that mental health is a social indicator, requiring “social, as well as individual, solutions.” Indeed, WHO Europe stated in 2009 that “[a] focus on social justice may provide an important corrective to what has been seen as a growing overemphasis on individual pathology.” The UN’s independent adviser Dainius Pūras reported in 2017that “mental health policies and services are in crisis—not a crisis of chemical imbalances, but of power imbalances,” and that decision-making is controlled by “biomedical gatekeepers,” whose outdated methods “perpetuate stigma and discrimination.”

Our economic system is a fundamental aspect of our social environment, and the side effects of neoliberal capitalism are contributing to mass malaise.

In The Spirit Level, epidemiologists Kate Pickett and Richard G. Wilkinson show a close correlation between income inequality and rates of mental illness in 12 Organisation for Economic Co-operation and Development member countries. The more unequal the country, the higher the prevalence of mental illness. Of the 12 countries measured on the book’s mental illness scatter chart, the United States sits alone in the top right corner—the most unequal and the most mentally ill.

The seminal Adverse Childhood Experiences Study revealed that repeated childhood trauma results in both physical and mental negative health outcomes in adulthood. Economic hardship is the most common form of childhood trauma in the U.S.—one of the richest countries in the world. And the likelihood of experiencing other forms of childhood trauma—such as living through divorce, death of a parent or guardian, a parent or guardian in prison, various forms of violence, and living with anyone abusing alcohol or drugs—also increases with poverty.

Clearly, many of those suffering mental and emotional distress are actually having a rational response to a sick society and an unjust economy. This revelation doesn’t reduce the suffering, but it completely changes the paradigm of mental health and how we choose to move forward to optimize human well-being. Instead of focusing only on piecemeal solutions for various forms of social ills, we must consider that the real and lasting solution is a new economy designed for all people, not only for the ruling corporate elite. This new economy must be based on principles and strategies that contribute to human well-being, such as family-friendly policies, meaningful and democratic work, and community wealth-building activities to minimize the widening income gap and reduce poverty.

The seeds of human well-being are sown during pregnancy and the early years of childhood. Research shows that mothers who are able to stay home longer (at least six months) with their infants are less likely to experience depressive symptoms, which contributes to greater familial well-being. Yet in the United States, one-quarter of new mothers return to work within two weeks of giving birth, and only 13 percent of workers have access to paid leave. A new economy would recognize and value the care of children in the same way it values other work, provide options for flexible and part-time work, and, thus, enable parents to spend formative time with their young children—resulting in optimized well-being for the whole family.

In his book Lost Connections, journalist Johann Hari lifts up meaningful work and worker cooperatives as an “unexpected solution” to depression. “We spend most of our waking time working—and 87 percent of us feel either disengaged or enraged by our jobs,” Hari writes.

A lack of control in the workplace is particularly detrimental to workers’ well-being, which is a direct result of our hierarchical, military-influenced way of working in most organizations. Worker cooperatives, a building block of the solidarity economy, extend democracy to the workplace, providing employee ownership and control. When workers participate in the mission and governance of their workplace, it creates meaning, which contributes to greater well-being. While more research is needed, Hari writes, “it seems fair ... to assume that a spread of cooperatives would have an antidepressant effect.”

Worker cooperatives also contribute to minimizing income inequality through low employee income ratios and wealth-building through ownership—and can provide a way out of poverty for workers from marginalized groups. In an Upstream podcast interview, activist scholar Jessica Gordon Nembhard says, “We have a racialized capitalist system that believes that only a certain group and number of people should get ahead and that nobody else deserves to … I got excited about co-ops because I saw [them] as a place to start for people who are left behind.” A concrete example of this is the Cleveland Model, in which a city’s anchor institutions, such as hospitals and universities, commit to purchasing goods and services from local, large-scale worker cooperatives, thus building community wealth and reducing poverty.

The worker cooperative is one of several ways to democratize wealth and create economic justice. The Democracy Collaborative lists dozens of strategies and models to bring wealth back to the people on the website community-wealth.org. The list includes municipal enterprise, community land trusts, reclaiming the commons, impact investing, and local food systems. All these pieces of the new economy puzzle play a role in contributing to economic justice, which is inextricably intertwined with mental and emotional well-being.

In Lost Connections, Hari writes to his suffering teenage self: “You aren’t a machine with broken parts. You are an animal whose needs are not being met.” Mental and emotional distress are the canaries in the coal mine, where the coal mine is our corporate capitalist society. Perhaps if enough people recognize the clear connection between mental and emotional well-being and our socioeconomic environment, we can create a sense of urgency to move beyond corporate capitalism—toward a new economy designed to optimize human well-being and planetary health.

Our lives literally depend on it.

Seven Ways to Build the Solidarity Economy

Credit: Flickr/Cogdogblog. CC BY 2.0.

by Emily Kawano, Transformation: https://www.opendemocracy.net/transformation/emily-kawano/seven-ways-to-build-solidarity-economy

The solidarity economy is a global movement to build a post-capitalist world that puts people and planet front and center, rather than the pursuit of blind growth and profit maximization. 

It isn’t a blueprint but a framework that includes a broad range of economic practices that align with its values: solidarity, participatory democracy, equity in every dimension including race, class and gender, sustainability and pluralism, which means that it can’t be a one-size-fits all approach. Nevertheless, the notion of buen vivir, or living well and in harmony with nature and each other permeates everything the movement does.

Some of these practices are old and some are new; some are mainstream and others are ‘alternative.’ Solidarity economy practices exist in every sector of the economy: production, distribution and exchange, consumption, finance and governance/state. People often think about cooperatives and credit unions which are collectively owned and managed by their members, but they are just one example. Others include community land trusts, participatory budgeting, social currencies, time banks, peer lending, barter systems, gift exchange, community gardens, ideas around ‘the commons,’ some kinds of fair trade and the sharing economy, and non-monetized care work.

The idea of the solidarity economy is to build on and knit together all of these practices in order to transform capitalism by lifting up and encouraging the ‘better angels of our nature.’ Rather than making a virtue out of the pursuit of calculated self-interest, profit maximization, and competition—the things that underpin capitalism—this economy nurtures our capacity for solidarity, cooperation, reciprocity, mutual aid, altruism, caring, sharing, compassion and love. Increasingly, research across many disciplines has shown that we are hard wired to cooperate—that in fact, the survival of the human species has depended on our ability to work together.

If this sounds like something you want to support, here are seven ways to help build the solidarity economy.

1.     Increase self-provisioning and community production.

Throughout history communities have grown and foraged for food; built roads, irrigation systems and housing; developed medicines and made clothing, furniture and art in order to sustain themselves. But under capitalism we are incentivized to buy all this stuff and so need jobs to earn money in order to pay for it. Since the 2008 global economic meltdown there have been increasing fears about the instability and fragility of this kind of economy. Add to this the projection that 40 per cent of jobs in the US could be replaced by Artificial Intelligence and automation and it becomes even more urgent to think about how communities can provide more for themselves in order to survive impending economic collapse or massive job destruction.

Community production includes low-tech ways of meeting needs like growing food and raising chickens in community gardens and ‘edible’ urban landscapes, as well as swap-meets, mutual aid networks and skill-shares. But it also extends to democratizing cutting-edge technologies. In Detroit, for example, (where some communities have been living with massive joblessness for decades), the James and Grace Lee Boggs Center to Nurture Community Leadership and Incite/Focus, a ‘fablab’ that puts cutting-edge fabrication technology into community hands, support a whole spectrum of community production experiments from permaculture, swapmeets and skillshares to 3D printed buildings and digital fabrication using Computer Aided Design (CAD).

2.     Move your money.

If you have an account at a big bank, consider moving your money to a local credit union. Credit unions are financial cooperatives that are owned by and run for the benefit of their members—the account holders. Better yet, find a community development credit union which is committed to serving low and moderate income communities. Credit unions are just like a bank in that you can open up a savings or checking account, get an ATM/Debit card, and take out a loan, but (on the whole) they have not engaged in the kinds of predatory lending and other financial shenanigans that crashed the economy in 2008.

3.     Invest in or gift to new economic institutions.

There are a many ways to support the solidarity economy financially. For example, ‘Direct Public Offerings’ (DPOs) have become a popular and successful way to raise capital for co-ops. DPOs reach out to the community to find investors who are willing to accept relatively low rates of interest because they believe in the mission of the enterprise. Lending circles, an age-old practice that has become increasingly popular, bring together a group of people who contribute a set amount each month, and each member gets a turn to receive the whole pot of money at zero interest. There’s also the option of participating in crowdfunding campaigns or gifting money and other forms of support to solidarity economy organizations and networks.

4.     Prioritize housing for use not speculation.

Our current real estate system leads to crazy outcomes. At a conservative estimate, for example, over half-a-million people in the US sleep on the streets each night even though there are 5.8 million vacant units (excluding seasonal and for-sale housing). One reason for this mismatch is that housing has increasingly become a speculative commodity—an asset to gamble with for huge potential gain—rather than to meet human needs. Not only does speculation add to the housing shortage by keeping units off the market and driving up prices, it can also implode, as it did spectacularly in 2008, leading to a global economic meltdown.

If you are looking at housing options, consider ‘limited equity’ housing like community land trusts and some housing co-ops and co-housing developments that take housing out of the speculative market. In these approaches re-sale prices are capped in order to maintain affordability. Concerns have been raised about preventing low and moderate income people from building wealth through real estate appreciation in this way, but it is the limited equity model that makes prices affordable in the first place.  

5.     Be your own boss—look for a job in a worker co-op or start your own.

Worker co-ops are owned and managed by their workers, who decide how to run their business and what to do with the profits—share them, reinvest them in the enterprise, and/or allocate some of them to community projects. This is in contrast to a capitalist business where the owners capture all the profits generated through the labor of the workers—a process of exploitation as well as class struggle.

Some cities like New York and Madison, Wisconsin, are investing millions of dollars to incubate and finance worker co-ops as part of an inclusive economic development strategy to create jobs and wealth building opportunities in low-income communities and communities of color. If you’re interested in this form of economic democracy you can look for a job in an existing co-op or start your own. That’s challenging but there’s a growing support system that provides co-op training programs and other forms of support to help you navigate your way.

6.     Connect with and talk to others in the emerging economic system.

If you’re interested, learn more about what’s happening and consider joining the U.S. Solidarity Economy Network or RIPESS (the Intercontinental Social Solidarity Economy Network) for other parts of the world. If you’re a writer then write about it; if you’re a student, study it; if you’re a teacher, teach about it; if you’re an activist, nudge your organization to adopt a solidarity economy framework. If you’re a politician, then promote policies that support it; if you’re already involved in an institution like a co-op, find ways to connect with others to build supply chains that work on solidarity principles. There are a million ways to help make the solidarity economy stronger and more visible. Even just talking about it is valuable.  

7.     Live the principles.

Capitalism nurtures competitive, calculating, and self-interested values and behavior, but Elinor Ostrom (who won a Nobel prize for her work on the commons) and others have documented how community-managed resources like forests, fisheries, pasturelands and water can be managed more efficiently, sustainably and equitably than those in private hands, provided that there are rules and enforcement mechanisms to prevent anyone from taking unfair advantage.

We need to build an economy that is premised on the whole of our beings and that leans towards solidarity in this way. We are all engaged in the valuable social and economic work of providing care for our children, elders, neighbors, and communities—not for money, but from our innate capacity for love, friendship, reciprocity, caring and compassion. So recognize that the solidarity economy is all around you and that you already live it. Nurture your better angels and live it well.

To learn more about the Solidarity Economy and the global movement to realize it, visit http://www.ussen.org.

Creating a Sense of Village in Your Neighbourhood

by Karen Reed, Tamarack Institute: http://www.tamarackcommunity.ca/latest/creating-a-sense-of-village-in-your-neighbourhood

There is a growing understanding about the richness of life that has been lost with our fragmented and isolated lives, and attention is now being given to restore the historic nature of neighbourhoods.

The close proximity and frequency to run into neighbours is what builds social capital - that relational fabric in a community. 

Sociologists have been sounding the alarm regarding our plummeting social capital; the absence of it is impoverishing our lives and communities. It is what builds civil society. This social connectedness is a primary contributor to a person’s sense of wellness and it is shaped by our local, daily life.

How do we combat the trends of ‘living above place’ versus being rooted, the trend of valuing the private over the common, and of the increasing isolation, fragmentation and speed of life? How do we live out our values – not as professionals – but as neighbours? I have become convinced that it is the local neighbourhood that is the best context for people to thrive.

Several years ago, I began a process of reorienting my entire way of life within the proximity of the neighbourhood, out of a longing for a more integrated way of living and a deeper experience of community. I began deceptively simple practices (that I now think have the potential to be staggering in its scope in helping us and others live well). My imagination was sparked for another way of living and being.

I moved into a 100-year-old house with six bedrooms and began offering a few rooms to rent. In the process, I discovered a need to hold space for people in transition, what some call the post-modern homeless. I eventually opened all the rooms for whosoever and invited them to stay as long as they wanted. There has now been over 200 that have lived in my house. It is a miracle of grace that I love this! I have moved away from a privatized way of living where your home is seen as a sanctuary, to the place of making your personal possessions more public, as Augustine argued for.

I quickly learned you couldn’t be present and be busy, so I spent the first year learning a radically foreign rhythm that had enough margin. I stopped using the word busy so as to not increase its value (my life is people, intense and full, but I no longer live on adrenaline and deadlines which I did most of my life). A culture built on speed tends to neglect relationships - especially those deemed optional - and the simple, ordinary practices that enable a community to flourish tend to diminish in value when we don’t depend on each other practically, and productivity and dehumanizing efficiency dominate our lives. It takes time to get to the place where you know your neighbours and can experience connection as a neighbourhood.

Alan Hirsch reminds us that to connect in our neighbourhood we need proximity, frequency, and spontaneity. For most of my life, I embraced the value of self-sufficiency and independence (what a delusion they are). Now, most of my life is shared - not with family, but with strangers; my home, car, food, resources, possessions, and time. It is wonderful, hard and beautiful, and I would never go back. 

I’ve also discovered how food builds relationship! Simple hospitality, around good food – and hosted regularly in homes - provides the best foundation for developing a social fabric in a neighbourhood. I moved from a compartmentalized practice of entertaining just friends and family – to a lifestyle of radical hospitality - to strangers and neighbours.

Eight years ago, I started hosting regular Sunday Soup Nights for the neighbours. In wanting to make it easy for people to come, I kept the barriers low; they didn’t need to RSVP, they could come late and leave early and didn’t need to bring anything (except their own drinks). I made a pot of homemade soup and some bread. We now average 45-55 neighbours coming, made up of every decade, from 20-70 years old and their children. Most people tend to only gather with their tribes, so people have loved it! Where else like the neighbourhood can diversity gather? Neighbours who have lived next door to each other for 15+ years and had never met till they came to our house, have now exchanged emails and even house keys. I think this is a taste of living well! We now have over 100 people on our neighbourhood email list.

Several women have shown up at the door on Soup Nights saying they wanted to meet the woman who invites strangers into her home. Even though many people are entrenched in fear and isolation, I have found how hungry people are for another way of being human. These very simple, ordinary practices that we do – have profound impact. Neighbourliness seems to have become a lost art. The idea of neighbourhood helps me think about fostering a sense of village, where as Peter Blocks suggests: every gift can be given.

After a few years of building relational connection in the neighbourhood, we put our hand to work together toward sponsoring a family from Syria. Together we raised $40K and welcomed our family to live in a suite on our street. What a gift they have been to our neighbourhood. We are now working toward a second sponsorship. Working together really deepens connection!

I’ve sought to root deeply into my neighbourhood seeking to be a faithful presence. I am not advocating that everyone lives at this level of intensity. GK Chesterton once said that we are to exaggerate what the world has neglected. I am seeking to exaggerate what has been neglected in the area of generous hospitality to maybe spark a few others to imagine with me ...

• What if every neighbourhood had a catalyst for inclusive hospitality? A lifestyle that nurtured a web of care in their place. What would it look like for your neighbourhood to thrive? 
  One neighbour asked me to be her executor. It prompted me to dream about my neighbourhood functioning like extended family.
• What would it take to develop enough connection and shared life, that you cared about each other like a healthy extended family?
• What if we didn’t think as professionals providing services and didn’t see our neighbours as projects or people to be served, but simply invited them into our life as friends?

What if we all lived well by loving our neighbours well?