0 How to Build Sustainable Localised Economies

What would be the difference between a national localised economy and the current neo-liberal model?  We need to build sustainable localised economies.  A localised economy means neighbourhoods need huge investment in rebuilding what the neo-liberal consensus has destroyed.

Towards the end of the nineteenth century, the first wave of co-operatives found opposed interests between retail and worker co-operatives. Retail co-ops aim to maximise dividends for their members, who are also their customers. Worker co-ops aim to maximise the workers’ wages.

Whilst there is a place for worker co-ops, it is not necessary for all businesses to be co-operatives. Indeed, any structures that divert energy into complicated constitutions, boards of directors, etc are not a good idea.

The key is collaboration. Small businesses work together to build their local economy and links into the national localised economy. If you are a baker you have no need to compete with other businesses in your area or bakers in other areas. It may be possible to collaborate with other bakers in your area. It depends on how many bakers a given neighbourhood can sustain.  Increasing numbers of people ready to buy locally produced bread, might be an example of mutually beneficial collaboration.

The local economy becomes sustainable when money circulates within it. A pound coin spent in the morning might be spent several times that day. Think of it as one coin. A coin spent 10 times is  worth £10 in terms of the goods received in return for it. It continues to be an asset to whoever holds it. When I hand a coin over I tend to think of it as lost to me. But in fact it is only by handing it over that everyone else’s wealth increases. As their wealth increases so does mine. If I have something to sell, they are more likely to buy it from me.

Consider the Local Economic Trading Systems’ (LETS) experience. They use a local currency. The best participants are not those who accumulate the currency, or accumulate debt. The best customers are the ones who most often cross zero. Accumulation means the economy becomes stagnant.

If everyone has £100 and no-one ever spends anything then the economy is not sustainable. It is the transactions that keep it going. This is how economies crash. As more people accumulate debt or wealth, the economy will slow down. The economy works when people spend.

Trust

Many conservative economists talk of an invisible hand that keeps the economy going. They claim it has its own intelligence. This is of course nonsense. The thing that keeps the economy going is visible and it is trust. When people lose confidence because of fraud or maladministration, the market fails.

People are more likely to trust their local market. People get to know the businesses in their area. They make recommendations to friends and so businesses grow. Those businesses can employ more staff, which increases currency in circulation and so long as they keep trading they help to keep the economy going.

The big challenge is how to restart this traditional approach to the economy. The retail co-ops started at a time when people were desperate for change. We cannot ignore adverse economic conditions and the selfish practices of corporations and their political supporters. But we need to show how it is done from the bottom up, just like economies throughout history.

We know how to do it and we know the basic principles. The challenge is to learn the practicalities of building a local economy in the 21^st century.

2 Institutional Development

A friend asked me to answer some questions to help him write an essay for his MSc in Development Management, “Why should development managers attempt to bring about institutional development?”  It’s quite likely I haven’t got a clue about institutional development but my response is below and he seems happy with it.  He will combine my reply with others and consider them for  part of  his essay.

The reason I’m reproducing my reply here is because I think it is relevant to the thread I’m writing about the nature of third sector organisations.  Whilst in my answer I refer to large organisations, perhaps it equally applies to small organisations that become bureaucratic.  What happens when small young organisations become institutionalised?

The headings are his questions:

1. What is an institution?

An organisation that is designed to be sustainable.  This means its continuation is not dependent on its leaders in the sense that when they leave there are always people available to step into their shoes.  This implies a high degree of bureaucracy.  The continuation of the organisation takes precedence over staff and clients’ needs.  Check out HMRC’s telephone helpline service if you don’t know what I mean.

2.  What is institutional development?

The big headache in institutional development is changing organisational culture.  It will tend to be highly stable and difficult to change.  I worked for an institution that had a complete change in top management at the same time.  Six managers left (were slung out actually) and were replaced by four new managers with new job descriptions.  This made no difference whatsoever to the institution and the new managers soon behaved in similar ways to the old ones.

3. What is the purpose of institutional development?

This rather depends on what you want to achieve.  A business may need to respond to its markets and can lose its way if the market changes and the institution can’t change with it.  HMV is an example of a business that had difficulty adapting to downloadable music and videos.  HMRC on the other hand does not need to change the way it does things as we’ll always need taxes.

4.  What activities does ‘doing’ institutional development involve?

Banging your head against a brick wall!  You’re not going to see rapid change.  Effective actions might take a long time to take effect and if the long time is longer than the lifespan of the person leading the change, then the policy might change before the previous policy had an effect.  Any proposed change is likely to be resisted.  Superficial changes can go through because they don’t touch the culture of the institution.

5.  What management skills does institutional development require?

Listening – to staff and especially junior staff rather than managers.  Many junior staff are likely to have been around for a long time and they understand how things work.  Many will have been around longer and understand more than the managers.

Listening to customers or clients – complaints and complements can be helpful and where appropriate good complaints procedures can help.  But also in-depth interviews with typical customers or clients might help.

Patience – it will be slow work!

So, what do you think?  Can small young organisations become institutionalised?

0 Making Blog Posts Accessible

Last Thursday I made some observations about writing blog posts. I looked at the differences between using blog posts as a diary, library or noticeboard. Today, I suggest some simple methods for making blog posts accessible, to help your readers navigate your blog. There are more complex approaches but my concern here is to suggest solutions anyone can carry out.

Noticeboards

The noticeboard can be a little difficult where you have a lot of events and want them in date order. If you leave it to the default the posts will appear in order of the date you posted them and not in date order of the events.

A simple solution is to use a WordPress plug-in such as “Simple Custom Post Order”, which allows you to drag and drop posts in All Posts window.

If you have a lot of events you it may be worth looking at one of the Calendar plug-ins.  I hesitate to use them because with too few events it’s possible to have pages of calendars with no events.

Diaries and Libraries

There could be hundreds of permanent posts on your site and you need some way to help readers navigate them. I’m assuming you use categories and tags and I have written about the basics of using these.  However categories and tags alone are not enough.

If you present category pages in the usual blog format, you will find you have a series of posts in reverse order of publishing. The reader needs to find the beginning and then scroll backwards through the blog. Giving them the url for the first post in the sequence does not help them find the rest of the posts in the sequence.

There are several approaches and each has its own strengths and weaknesses.

Cornerstone Pages

One solution is the Cornerstone Page. You will find examples of these in the navigation on my site. A Cornerstone page lists the posts in a sequence in a coherent way.

It enables you to summarise the sequence. The reader can read the page to get an overall idea of what the sequence is about and follow the links to posts for more detail.

These pages can be used as landing pages and they can be search engine optimised. This way you can use them to draw traffic to your site and guide new visitors to what you have to offer on the topic they are searching.

Mindmaps

A mindmap is where you write your central topic heading in the centre of a page or screen and then add links as you break down the topic into its parts. This can be done using mindmap applications such as xmind.net. Mindmaps can show how the various posts link together. With xmind you can either turn your map into a pdf or use a xmind file, which can be opened by anyone with xmind. Xmind is a free application with a premium version. I’ve got a lot of use out of it without paying for the premium.

You can set it up so that the map includes links to blog posts. So, someone exploring your map can jump to a post for more information.

The main disadvantage is you need the software to open a mindmap. This may be something you give away to people who want to be on your email list.

Products

And of course you could convert your posts into products such as an ebook, a real book or a video course. If you are blogging to find out what you know, as the material accumulates you may be able to convert into a more accessible medium. Posts can be taken down but many people who value your work might be prepared to spend a little on a more accessible format.

1 Third Sector Organisations: Unable to Take Responsibility

In this exploration of the differences between third sector organisations and businesses I have considered the tendency of third sector organisations to become bureaucratic and legalistic. These in turn lead to a tendency for no-one to take responsibility for decision-making.

There are two main reasons for this, one is the general ethos of third sector organisations and the other is to do with their staffing arrangements and I’ll look in-depth at staffing next time.

In general a small voluntary group have a committee, Trustees’ meeting or board of directors.  Their ethos is shared responsibility and the committee is the vehicle through which its members act together.  So, small groups have to make collective decisions and so tend to build lack of trust in any one person into their structures.

A small business will have one or very few active decision makers.  Larger businesses and voluntary sector organisations may encounter similar problems and will develop strategies over time to mitigate them.

It is easy to say it is better to ask forgiveness than to ask permission. Generally this can be good advice. When you’re dealing with bureaucracy if you make a proposal a likely response is proliferation of decision-making steps.  The temptation to act and sort out the bureaucracy afterwards is attractive.  But is it advisable?

I suggested a radical change to a voluntary sector organisation facing a desperate shortage of cash. They needed to research this new direction’s feasibility. Their marketing and development committees are separate and apparently unable to communicate. If marketing is aware of demand, their development committee won’t necessarily be interested because they’re already developing stuff.  The development committee is interested in what they’re doing and not in selling it.  Their products are good but follow their members’ interests and not the demand from their market.

Subcommittees

Furthermore it is not clear whether these subcommittees can make decisions themselves or whether they need to go to the Trustees, who meet about once a quarter.

Meetings of all these groups are occasional and so it is difficult to get any traction or make progress. I’ve forgotten what we were talking about between meetings because they are so far apart. Most people are volunteers and don’t have the time to pay full attention to the matters in hand.

In this case it is not practical to act and ask forgiveness. My ideas are in the long grass and not because anyone opposes them. The organisation is not able to accommodate them. It is in desperate need of finance and yet unable to take the decisions necessary for its survival.

There is another reason asking forgiveness is not always a good idea. If someone in control is threatened they can act to close down discussion.  Where several very part-time people are involved in decision-making, one person can have a great deal of power.

Handling Offers

The principle, you would think, is simple but many organisations don’t know how to handle an offer. An offer requires a response; a yes or a no. I time limit my offers for my sanity. Generally a long silence means “no”. Even a silence accompanied by assurances they’re thinking about it means no. Personal attacks and accusations you’re trying to make money out of them also mean no. No will suffice. You don’t need to give a reason, just say no!

A small business may have similar constraints. But there is one big difference. An offer is ultimately about how much they want it and whether they can afford it. Also time is their most precious commodity and even if they don’t care about mine, they care about their own.

You would think third sector organisations would be better off if they employ staff to carry forward the work of the organisation and enable the Trustees to take a more strategic view. But staff can make matters worse. I’ll explain why next time.

2 How the Inclusion Agenda Became Self-Defeating

Last Tuesday I covered anti-capitalism for the first of my discussions of third sector worldviews and today I turn to inclusion.

I appreciate people sharpening their quills because they read this post as an attack on inclusion. I am not opposed to inclusion, indeed a marketplace is by definition inclusive. How could it be otherwise? My problem is with how inclusion has developed over the years.

Nothing Propinques

A friend, a development worker, years ago found a chapter heading in Ian Fleming’s “Diamonds are Forever”, it reads “Nothing Propinques like Propinquity”.

We were puzzled by his constant repetition of this phrase and persuaded him to spell out his meaning.

If your concern is about poverty, then the thing the poor have in common is their poverty. Granted more women than men are poor, more black people than white are poor, more disabled people than able-bodied are poor (and you can keep going) but the point is ultimately if someone is poor they are poor whatever their sex, race, etc.

The only way to tackle poverty is by addressing its roots and yes those roots may include discrimination but discrimination is one means of dividing the poor from one another, undermining solidarity and mutuality.

Inclusion and Class

Inclusion never addresses class. We never discuss how we’re going to include the ruling classes in our communities. Why? They concentrate power in fewer hands and they will do anything to hold onto their power.  We know inequalities in wealth are the cause of disadvantage.  Racism is one of many ways the ruling class uses to divide and disempower communities. The focus needs to be on the roots of poverty in the economic system and not on the many ways in which it is possible to stoke the fires of prejudice.

There have been many attempts over the years to name disadvantaged groups and empower them by helping them set up a group that represents their interests. This plays into the hands of corporations and politicians because it drives wedges between disadvantaged groups.  Strong democratic community organisations are the best resistance to divide and rule.  The challenge is how to make these effective.

I recognise the good some of these specialist groups can do for their people. But the issues around for example accountability are profound. If you set up an ethnic economic development project, to whom should it be accountable?

I prefer generic organisations providing specialist services in neighbourhoods. The users can be members and so make sure the generic service is accountable. This would embody mutuality within the organisation, each specialist service supporting the others.

That leaves the question: how to fund community activity and I shall return to this next Tuesday.

5 National Localised Economy

Last Monday I wrote about altruism as a value in the local economy and explained how on a day-to-day basis self-interest is more effective.  Sustainability is another value essential to a national localised economy.

We live in times when financial institutions, based on greed and false values such as competition, are highly unstable. Nothing was learned from the 2008 crash and it seems we’re heading for another crash which will be worse because our governments spent reserves fire-fighting the last crash.

Monetarism and neo-liberalism are seductive ideologies; our politicians no longer question them. In the UK all three main parties subscribe to them and so does UKIP, the UK Independence Party, the great pretender to their throne. UKIP claims to be pro-sovereignty. But what is sovereignty for if legislatures are unable to regulate the economy?

The UK government has lost sovereignty but not to Europe. It has been lost it to privatisation. People lose faith in MPs because they have sold their powers to the private sector. Leaving Europe will cut the UK off from others who believe regulation is the heartbeat of democracy.

Sustainability

Sustainability is a value at the heart of the local economy but not where corporations extract finance from the economy; not where these large financial institutions suffer from boom and bust.

Small businesses fail. Of course they do and so they should. Successful businesses identify a gap in a market and may do very well out of filling that gap. But opportunities move on. An experienced entrepreneur will know when to move onto the next thing.

The UK retail co-operative movement was enormous and yet it was mostly local initiatives. They created larger organisations, such as the Co-operative Wholesale Society, to supply their shops with goods to sell. Their perspective was “Think Global, Act Local” and that is still a good perspective. The idea that an economy can be run from the top down has always proved to be highly dubious.

It might be better to think of a national economy as a localised economy; an economy where money circulates and does not accumulate in offshore accounts. The big supermarkets copied the co-ops but missed the local point. They might open corner shops in neighbourhoods, but as part of a corporate plan, driven by competition and not having genuine roots in a neighbourhood.

So, in what ways are local economies sustainable?

0 Can You Sell Spirituality?

The question “Can you sell spirituality?” came up in conversation recently.  The person who asked it plans to provide an online spiritual direction service and worried that asking for money in exchange for her services would in some way be immoral.

I’ve given this some thought and my answer is no you cannot sell spirituality because it is not yours to sell.  It is the same reason “Money can’t buy you love” as the Beatles put in many years ago.  Spirituality and love (are their others?) are of the heart.  They are my responsibility and no-one can sell me a solution to my existentialist angst.

The Wrong Question

Moreover, “Can you sell spirituality?” is the wrong question.  Lots of people have spiritual directors and most of them charge for their service.  I’m not sure how many make a living out of it but it is legitimate to make the charge.  Why?  Because you are selling your time and experience as a service.  It is your time and service that is for sale, not spirituality.

The important thing is integrity.  You need to be clear about what you are selling.  Services such as spiritual direction are obviously open to abuse.  Most spiritual directors are accountable to some sort of support network.  It may be someone selling a course online might not have any accountability and that could lead to exploitation.

But it’s like everything else, if you have put in time and effort to produce something worthwhile, there is no harm in charging for your time and service.  Whether you charge to make a living or to make-a-million is a matter for your conscience.

1 Writing Blog Posts

Last Thursday, I completed an overview of using WordPress to write blog posts by comparing the visual and text areas. There are a lot of details I haven’t covered over this sequence and so if you have questions, leave a comment. Today’s post is about blog content.

At the beginning of this sequence I suggested there are at least three approaches to blogging; the diary, library and noticeboard.  You can combine these approaches. Using categories, you can set up pages in your navigation that each focus on one of these approaches. So you might have a noticeboard for events and take down posts when events expire and an information page where you can archive permanent information. I shall go into more detail about archiving information next time.

I found this post recently which identifies four steps to writing a blog post. Below, I shall explore the implications of these four steps for my three approaches to writing blogs. This will illustrate something of diverse approaches to blog writing.

A Plan

Individual blog posts should always be planned but the article does not consider planning sequences of posts. Perhaps a diary needs least planning as it is a response to what is happening. This is not to say though that there is no framework for a diary blog. The most successful diaries have a theme and not an aimless series of events. Some people start a blog because they know the story they want to tell. Others may find a theme emerges.

The library approach demands a clear plan for linked sequences of posts. This presents its own difficulties. Whilst it may help the writer to develop ideas and themes, it can be difficult for the reader to follow, if only because posts are usually presented in reverse order of publishing. I shall look at ways of presenting posts next time.

External events shape both noticeboards an diaries. Their posts are likely to be temporary and aim to inform their readers of events. Events might be meetings but could be a range of things readers need to know. Whilst a blog for an organisation might inform its members of its events, other noticeboards might feature events around a particular theme. So, people sign up because they are interested and find information about their interest.

Permanent or Temporary?

Blog posts are designed to be temporary. When you delete a blog post, it normally has little impact on your website, unless you have links to it.

The big advantage for a diary is you can archive it and use various methods to foreground the best material. Diaries allow you to experiment and find your voice. Once you have found it there are ways to organise your posts that you can bring your best writing to your site visitors’ attention .

Libraries are designed to be long-lasting. There is no reason blog posts cannot be long-term, substantial resources on your website.

Noticeboards need to be kept up-to-date, old posts removed or archived and new posts added in good time so readers can act upon them.

Your Audience

This is an enormous topic and I have addressed your audience elsewhere. All three types of blog are likely to attract an audience if they have a clear theme. A diary called “Living with Diabetes” might be an entertaining account of how the writer struggles with giving up sugar and losing weight. It would not necessarily provide serious information. A library about diabetes might be a series about advice for people who are newly diagnosed. A noticeboard might be for a local group of diabetes sufferers and give them information about local events they might find helpful.

All three approaches might appeal to the same audience. A site might therefore feature all three approaches or specialise on one perhaps because other sites handle the other approaches.

Search Engines

The main things to remember about search engines is (1)they aim to find the best answers to questions asked by searchers, (2) the rules change regularly.

Whatever approach you use the best advice is write about one topic per post and be clear, especially in the title about what the post is about.

You may have landing pages on your site for visitors who are searching for sites about your topic. The “long-tail” referred to in the four-steps blog post refers to the answers to a specific question a specific post might contain. If one in five of your posts attracts a visitor once during its lifetime and your blog has a lot of posts, it could attract similar traffic to your landing pages.

However search engines are only part of a strategy to drive traffic to your blog. So, a noticeboard for example may be primarily for members or subscribers to your email lists. Library and diary blogs may be intended for visitors found online and you can use social media and other networking tools as well as search engines to point people to your blog.

1 Third Sector Organisations: Legalistic Practices

Last Wednesday I started to explore the differences between small businesses and third sector organisations. The main difference is small businesses can be more responsive to their customers because they do not need the bureaucracy to manage accountability for grants or contracts.  Perhaps the most common drag on third sector organisations is legalistic practices.

The bureaucratic nature of third sector organisations is partly down to their need to be accountable to funding bodies. But the problem goes deeper than that. The organisations that advise third sector organisations pass on the bureaucratic model. This means they saddle small organisations with structures they may not need.

A self-employed person can work for many years at their own risk. If their business fails they risk bankruptcy but many of them carry on successfully for many years without incorporation.

Third sector organisations do not normally belong to one person and so they need some sort of agreement about how a group of neighbours or people with a common interest will work together. So, they draw up a constitution and for many such organisations an unincorporated association is all they need.

Incorporation and Charitable Status

But under certain circumstances, such as employing staff, they must apply for registration as a charity. Then they must opt for incorporation to protect their Trustees. Soon, they find they must send in annual returns or else they will be liable for fines. I’ve seen several social enterprises, which would have worked as self-employed businesses, bogged down in these structures.

Incorporation and charitable status may be essential to receive substantial funding and then accountability to their funding bodies is added to the bureaucratic burden. Many self-employed people avoid the bureaucracy that ties small community organisations, just to get on with what they thought would be a simple piece of work.

The result is many organisations become over legalistic. Some of this can accounted for simply because they have registered as a charity and as a company.  It becomes a part of the mindset.  Someone told me the other day, a tiny voluntary organisation should have had a whistle-blowing policy.  The Trustees knew what they needed to do; a policy would not decide whether they do it.  This legalism is fueled by fear of what the authorities might do if certain activities are not carried forward in a prescribed way.  But the authorities are not interested in the minor issues most organisations encounter.  It is the Trustees’ responsibility if something goes wrong and most issues are easily resolved.

Trustees and Directors

Most small businesses get on with the job and do not have to pass every decision through Trustees or directors. Larger companies need them.  So why do we think community groups need them?  Many groups struggle to find people to sit on committees and then find they comprise people who mostly have a limited understanding of either the legal constraints or of the work of the organisation.

Once you get into the legalistic mindset, there are always excellent reasons for not doing things. Ask a solicitor whether you can do something and they’ll tell you why it isn’t a good idea. This is the wrong question. The right question is how do I do the new thing? I’ve made the decision and I don’t want to know it’s too risky, I want to know how to do it without unnecessary risk.

4 What’s the Problem with Capitalism?

What’s the problem with capitalism?  Anti-capitalism is the first in my exploration of third sector worldviews.

Where Marx Was Wrong

Marx is perhaps the origin of anti-capitalism. His is certainly the most prominent name. Whilst there was always criticism of capitalist thinking, see Isaac Watts, “When I survey the wondrous cross” for example, opposition to capitalism coalesced around Marx. Other socialist movements were more positive about the capitalist economy, eg the co-operative movement.

Marx identified capitalism’s internal contradictions.  Much of what he wrote proved to be correct but he was wrong on two counts.

Totalitarianism

First, the experiments to build economies based on socialism became totalitarian. There are a number of reasons why this happened. When a country prevents people from trading, they must centralise the entirety of the economy. Instead of allowing government to regulate the economy, to keep businesses small and local, the state attempted to run everything. Getting the balance right between what the state runs and what the people run is not easy.  The Soviet Union did not abolish capitalism but developed something called state capitalism.

Concentrations of wealth and power is bad news when it belongs to the state just as much as when it belongs to individuals.  Tendencies in western capitalism to concentrate wealth in the hands of the 1% are just as likely to lead to totalitarianism as state capitalism.  The issue is democratic accountability and it is absent from totalitarian economic models.

Capitalism Survived!

Marx was also wrong that capitalism could not survive. He believed it would succumb to its internal contradictions.  It has survived in a mutated form. Power concentrates in the hands of huge corporations. Governments have sold off state assets to corporations and as a result government is no longer able to govern. The people understand this to some degree but few political parties offer an alternative.

Anti-Capitalism in the Third Sector

In the third sector there is sometimes an anti-capitalist worldview that sees the market as something to be resisted. This is not always expressed as revolutionary communism; more often it is a quiet moral superiority to the grubby realities of the marketplace. Their critics tar all business owners with the same corporatist brush.   This suits the corporations of course. This all-encompassing anti-capitalism doesn’t touch them but incapacitates small businesses.

Worse it means third sector organisations do not think about small businesses to rebuild the local economy. Indeed they don’t think about the local economy. So, throughout my working life community organisations have either ignored the local economy, focusing upon the needs of disadvantaged sections of the community, or else they have set up alternatives to the local economy, such as social enterprises.

Do Social Enterprises Undermine Local Business?

I suppose the idea is the people who run social enterprises do not subscribe to capitalism. Too often as a result they are not a permanent part of the economy and become dependent on grant aid.

Meanwhile, this marginalises the people who might affect lasting change in their neighbourhoods, the local business people. Their skills and values are not accepted and so they are side-lined. The organisational failures that plague so much community work are familiar to business people. They know they don’t work and so keep their distance. They’ve seen it all before and know how destructive it can be.

The frustrating thing is the most creative period in recent UK history for development of local economies was the mid-nineteenth to mid-twentieth century.  The retail co-operative movement, is part of the capitalist economy, even though it owns capital collectively. This demonstrates the creative potential of capital when democratically owned.

I’ll explore some of these issues in more detail in future posts.  Find them by following this link and scrolling down to Third Sector Worldviews.