By: Eileen Gao, SMSBF Intern
An avalanche of issues has collapsed on the United States—just a sample of The Atlantic’s recent headlines include: “America Should Prepare for a Double Pandemic”, “A Lot of Americans are About to Lose Their Houses”, and “First Comes Police Reform, Then Comes Everything Else”. These issues have flooded my social media feed with posts promoting charities, encouraging voter registration, and urging mask wearing. And it’s amazing how effective these social media campaigns have been; the Brooklyn Bail Fund raised $1.8 million within 24 hours after which they directed donations elsewhere. At the same, it’s alarming how polarizing these campaigns can be. Although in other countries such as Japan mask-wearing was normal even before the pandemic, some Americans have taken mandatory mask rules as an infringement on their freedom.
Clearly, civic engagement is both complex and meaningful, and these campaigns inspired me to pursue opportunities that address these current issues. After being particularly struck by the pandemic’s devastating impact on local economies, I joined the Resilient Local Economies internship, which led to my working with SMSBF.
This article represents the first in a series I’ll be writing for SMSBF. The series will examine local economics and what democratizing the workplace can mean to increasing equity in our system.
As part of my internship, I’ve been given the opportunity to explore how concepts from the local economics movement address front and center issues such racial inequality, income inequality, small business struggles, and even climate change. A significant part of this education is a lecture series, including one by Michael Shuman, wherein Shuman discusses applying community economics to building stronger, more resilient communities.
Shuman’s first suggestion is to increase community banking and investing, which struck me as the most actionable of his ideas for non- business owners like myself. As a college student with gratefully little financial responsibility – although I have reflected on where I spend money – I have thought little about where I bank and invest my money beyond mindlessly following the instructions given by my parents. Shuman’s discussion of community banks, local investment funds, and DIY retirement options struck me as powerful ways for people to support their local economy while doing something they already probably do. Before the pandemic, local banks provided 60% of loans to small businesses while comprising only 24% of the banking market. Now these banks are even more crucial to small businesses: The Institute of Local Self-Reliance found that states in which local banks comprise a larger portion of the market, small businesses received a greater amount of PPP loans. I plan on digging deeper into the positive impacts of community banking and investing while talking to local experts to gather ways for individuals of the Southeast Michigan community to get involved.
Shuman’s last suggestion has to do with democratizing ownership, which ties into a common type of local bank: a credit union!
I’ve always banked with my local credit union and embarrassingly, I never realized a credit union was a not-for-profit, member-owned cooperative, meaning members can vote on topics such as the board of directors. It’s funny because I always associated the word “co-op” with those trendy grocery stores popping up in cities, but 40% of Americans (including myself) already belong to a consumer-owned organization. Democratizing ownership, particularly for worker-owned businesses, has been shown to improve business performance, job security, pay/assets available to workers, and working conditions. All these elements have been severely impacted by the pandemic. As businesses struggle to survive, millions of Americans have already lost their jobs, and essential workers are forced to work in person despite health risks. Given these increasingly alarming issues, I will also explore how democratizing work can be a hopeful solution.
In the upcoming articles, I’ll be focusing on these two ideas: community capital and democratizing work. I plan on featuring different research, interviewing local experts, and hopefully providing some exciting ways that you can take action to benefit the Southeast Michigan community!