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The Ann Arbor Chronicle (Michigan)

How to Sustain a Local Economy: From PB&J to Regional Currencies

Mary Morgan

Panelists at the Sept. 23 Michigan Peaceworks forum on the local economy, from the left: Tom Weisskopf, University of Michigan economics professor; Ellen Clement, Corner Health Center executive director; Jeff McCabe, People's Food Co-Op board member; Lisa Dugdale, Transition Ann Arbor; Michael Appel, Avalon Housing executive director; John Hieftje, mayor of Ann Arbor. (Photo by the writer.)

When The Chronicle entered the lower level meeting room of the
downtown Ann Arbor library, the first things we noticed were three
large trays of peanut butter and jelly sandwiches, cut into bite-sized
wedges. As public forums go, this was an offbeat gnoshing choice.

It turned out that the sandwiches - and apples, soft drinks, potato
chips and other food - were all sourced from Michigan, in keeping with
the theme of Wednesday night's event. The panel discussion focused on
the state's economic crisis, and how the community can respond to it. 
Buying local products is one example.

Starting a local currency is another possibility - the Ann Arbor
Downtown Development Authority is funding a study to look into that.
Generating  electricity locally is also an opportunity - Mayor John
Hieftje told the group that he didn't think the dam at Argo Pond would
be removed, in part because it might be used for hydropower in the

The forum - "Michigan's Economic Situation: Crisis or Opportunity?" - was hosted by Ann Arbor-based Michigan Peaceworks
and Washtenaw Voice, a coalition of local nonprofits that are working
together to increase voter turnout and bolster the community in other
ways. Michigan Peaceworks is the lead agency in this effort, part of
the broader Michigan Voice initiative.

State and national issues were part of the discussion, but most of
the six panelists focused on how the local community can take action in
specific areas, including food, health care, housing and the

The Panelists' Perspectives

Laura Russello, executive director of Michigan Peaceworks, moderated
the panel. She began by announcing that state Rep. Rebekah Warren, a
Democrat whose district includes Ann Arbor and who was originally
scheduled as a panelist, got stuck in Lansing and sent her regrets.
(The legislature is trying to resolve a projected $2.7 billion budget
deficit by the start of its fiscal year, on Oct. 1.) The others who
spoke at Wednesday's forum represented a cross-section of the
community, including academia, nonprofits and the government. Here's a
sampling of their comments.

Tom Weisskopf, University of Michigan economics professor

Weisskopf, who served as director of UM's Residential College from
1996 to 2005, compared the current economic crisis to the Great
Depression of the 1930s. Though not as deep as that decline, today's
economy faces unprecedented challenges, he said.

"We really need a transformation, not just a recovery," Weisskopf said.

He described the Solidarity Economy,
an international movement that rejects profit-centered values and
embraces cooperation, equality and local control. He listed several
examples of ways that this movement is taking shape. Community land
trusts - nonprofits that provide "truly affordable housing," he said -
are cropping up across the country, and have lower foreclosure rates
than the general housing market. One successful example is the Champlain Housing Trust in Burlington, Vermont.

Community-owned corporations, with locally elected boards and shares
sold to local investors, are another example of the solidarity
economy.  In Ann Arbor, People's Food Co-op fits this model, Weisskopf said. Other "solidaristic" examples include worker-owned cooperatives like Cleveland's Evergreen Cooperative Laundry, community development financial institutions, and the green jobs movement, with efforts like the Green Collar Jobs Corps in Oakland, Calif.

Ellen Clement, Corner Health Center

Clement began by noting that she'd worked for over 20 years in
public health - earlier this year, she resigned as health officer for
the Washtenaw County Public Health Department to take the job as
executive director at the Corner Health Center, a Ypsilanti clinic for
teens. "Believe me, it's an eye-opening change," she said.

Responding to the question of whether the economic crisis can be
turned into an opportunity, Clement said that for health care, dramatic
change won't happen without a crisis. That crisis has
arrived, and it's time to make sure that health care is seen as a
right, not a privilege, she said. "There's just, to me, no excuse for
not having health care for all."

But providing health care alone won't be enough, she said - it's
also about keeping Americans healthier, with policies and incentives
that focus on preventive care and promote healthier lifestyles. Clement
cited efforts like the Ann Arbor Non-Motorized Transportation Plan and the Ann Arbor YMCA's Pioneering Healthier Communities, which focuses on providing recreational programs to youth in Ypsilanti.

She noted that as they listen to the panelists, the audience would
see that all of the topics are interconnected - that's what
sustainability is all about, she said.

Jeff McCabe, People's Food Co-op and Friday Mornings @ Selma

McCabe contends that food is taken for granted, more so than even
air or water. There were moments of crisis regarding the quality of our
air and water that prompted policy reforms, he said. "In food, we
haven't seen that change yet."

Americans still want their food fast and cheap, McCabe said, and the
locavore movement - with its focus on eating locally grown and produced
food - hasn't even taken one mile out of the 1,500 miles that food
travels, on average, to get to our table.

About 1% of food consumed by residents of Washtenaw County is
actually produced in the county, McCabe said. What if that were
increased to 10%? Assuming that local residents spend over $1 billion
annually on food, increasing consumption of locally grown food could
put $100 million into the local economy, he said. Demand would drive an
increase in local farming, potentially generating thousands of jobs.

McCabe cited Eliot Coleman of the Four Season Farm
in Harborside, Maine, as a model of a small-scale, year-round venture
that could work equally well in Washtenaw County. McCabe supports local
efforts toward that goal - proceeds from Friday Mornings @ Selma, a weekly breakfast salon run by McCabe and his wife Lisa Gottlieb, help fund hoop house projects in this region.

"We vote with our wallets every day," McCabe said. "Think about that when you buy your food."

Lisa Dugdale, Transition Ann Arbor

Dugdale, a founder of Think Local First of Washtenaw County and now a project manager for the Clean Energy Coalition,
said the current economic crisis was really an inevitability. She
described the Transition Town movement as a response to the challenges
of global warming, peak oil and economic instability. [See previous Chronicle coverage of Transition Ann Arbor. Dugdale is one of the group's organizers.]

There are concrete actions that individuals can take, Dugdale said:
Buying less, repairing or repurposing items you already own, buying
from locally owned businesses that will keep money circulating in this

More broadly, the community could do an "economic leakage" study,
Dugdale said, looking at sectors that drain the most money out of the
community, then focusing economic development efforts in those areas.
Food production might be a sector that fits this category, she said.

Creating a local currency is another way to keep money in the
community, Dugdale said. Think Local First was recently awarded a grant
from the Downtown Development Authority to analyze the feasibility of
starting a local currency, she said.

The Chronicle made a follow-up query to Susan Pollay, the DDA's
executive director, who said that the $6,000 grant was authorized
earlier this month. Some of the questions that the study will address

  1. How strong is the demand for a local currency program?
  2. How would a local currency program be different than gift
    certificate programs to local businesses (such as the former Ann Arbor
    Gold program run by the Ann Arbor Area Chamber of Commerce) and how are
    those differences articulated?
  3. If a local currency program were created in Ann Arbor, would it
    involve coordination with a local bank? If so, how would that bank be
  4. Can a local currency program be managed by an existing organization (e.g. Think Local First) or is a separate agency needed?
  5. What kind of longevity are other local currency programs experiencing?
  6. Is it anticipated that local businesses would see revenue increases
    as a result of a local currency program? Are there other benefits one
    might see from such a program?

The study will likely take three to four months to complete, according to Pollay.

Michael Appel, Avalon Housing

Appel explained how housing has become more than just shelter. For
many, it's an asset that creates inter-generational financial
stability, even more so than income. People were frightened by the
recent housing crash because the dramatic drop in their home's value
meant they were losing the value of a long-term asset, he said.

These personal financial difficulties turn into community crises, as
entire neighborhoods are hit by foreclosures. Ann Arbor is less
affected than some communities, Appel said, but some areas of Washtenaw
County are suffering dramatic foreclosure rates. Foreclosures also
displace renters - when their landlord loses the house through
foreclosure, the renters are forced to move, even if they've been
paying rent. This affects some of the poorest in the community, he said.

The housing crash also affects the nonprofit that Appel runs. Their
model relies on private investors, who in turn receive tax incentives
for investing in Avalon projects. [The group's most recent project,
Near North, received approval from the Ann Arbor city council
on Monday.] But real estate is no longer seen as a secure investment,
he said. Further, if a corporation - and potential investor - isn't
profitable, tax credits would be of little value to such an entity.
These factors have curbed the amount of equity available for low-income
housing projects.

There are still some opportunities, Appel said. Much of the federal
stimulus money is going into the housing sector. The irony, he said, is
that the government's "cure" isn't focused on helping people find a
place to live - it's focused on fixing housing as an investment. In
general, he said, it's worth considering whether housing should be
viewed as a way to build financial security.

Any investment in housing should stress energy efficiency, Appel
said, as well as coordination with transportation and jobs. We've seen
how the suburbs can leave the local economy vulnerable, he said.

John Hieftje, mayor of Ann Arbor

Hieftje said he was a member of the Michigan Climate Action Council, which released a report in March of 2009
that included several policy recommendations related to reducing
greenhouse gas emissions and other environmental issues. However, the
state has been slow to act on those recommendations, he said.

Hieftje spoke about various environmental initiatives undertaken by the city of Ann Arbor, including the installation of LED street lights,
the addition of bicycle lanes and the goal of using 30% renewable
energy for municipal operations by 2010. As an example of areas that
are doing even more, he pointed to Ontario, Canada, which has
large-scale wind farms and two major solar plants. Public policy in
Canada and Europe - including the use of feed-in tariffs - makes it easier to promote renewable energy in those countries, he said.

One of the things that Michigan can do to promote economic recovery
is to refocus on making cities the kind of places where people want to
be, Hieftje said - the business will follow.

Audience Q&A

The audience asked a range of questions. Here's a sampling.

Q: How does the city reconcile the seemingly contradictory
goals of encouraging alternative transportation while building a new
parking structure?
Hieftje said that although the city
supported alternative transportation, they weren't trying to create a
non-motorized downtown. They'll be losing at least 700 parking spaces
in the coming years, he said, and the new underground parking structure
on Fifth Avenue - a project which will be breaking ground next week -
is only replacing the parking they're losing. He added that Google
wouldn't have located in downtown Ann Arbor if there hadn't been
parking available. Insufficient parking simply drives business to the
suburbs, he said.

Q: Can Ann Arbor's dams be used to generate local electrical power? Can Ann Arbor establish a city utility? The
city already produces electricity at Barton and Superior dams, Hieftje
said. The dam at Gallup has a 50% greater capacity for generating
electricity than Argo dam, he said, with about a 35-year payback on
investment. But new technologies might make it possible to tap the
water flow in ways that aren't yet possible, Hieftje added. That's why
it might be smart to keep the dam at Argo, he said: "I don't really see
Argo Dam going away." [See previous Chronicle coverage of an Ann Arbor Energy Commission meeting that discussed the issue of hydropower at the city's dams.]

Because of changes at the state level, it's harder to establish a
municipal utility now than in the past, Hieftje said. The city hasn't
given up on that possibility, but it isn't easy.

Q: It seems that the organic and local food movement is
elitist. How can these movements affect food availability for people
with less money?
Jeff McCabe said it's a matter of
prioritizing. Do you spend money on a box of cereal or spend time
cooking a healthy grain? Those are choices that people make. He noted
that commercial food is subsidized, making it more difficult for
smaller, organic producers to compete on price. Ellen Clement said that
there's some relationship between the price that people charge and
their customer base, citing the example of dramatically lower prices at
the Ypsilanti Farmers Market, compared to the market in Ann Arbor.

Q: What are the political roadblocks to building green communities?
Hieftje blamed the Republican-controlled state Senate for a reluctance
to give up old ways. Policies need to change in Lansing that affect
what local municipalities can do. He added that he thought the locally
elected legislators did a good job.

The Q&A was followed by breakout sessions, focused on food,
health care, housing and the environment. Later, in wrapping up the
evening, Russello said they'll be taking the information and feedback
from the forum and using that to identify projects for the Washtenaw
Voice coalition. They'll be launching a website with a calendar and
blog.  It will be progressive, she said, adding that organizers are
still trying to define exactly what "progressive" means in this context.

Groups Involved in Washtenaw Voice

The following local groups, or the local chapters of these state and
national organizations, are part of the Washtenaw Voice initiative. The
coalition is not affiliated with the Washtenaw Community College
student newspaper, which is also called the Washtenaw Voice.

The Ecology Center

Michigan League of Conservation Voters

Working America

The Women's Center of Southeast Michigan

Interfaith Council for Peace and Justice

University of Michigan Labor Studies Center

Michigan Peaceworks

Learning Disabilities Association of Michigan

Clean Water Fund

Chelsea Community Hospital

March on the Vote (no website available)

Health Care for Michigan

Center for Michigan

Transportation Riders United

Metropolitan Organizing Strategy Enabling Strength

Partners in Personal Assistance


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