Local Economies Close the Distance Between Us

On Christmas Eve, shoppers linger to talk to one another at a farmers' market in Canterbury, UK.

Photo by Chris Beckett

I live in a 19th century neighborhood in a small New England city. My mother-in-law, who grew up in this same neighborhood, often talks about what it was like during her childhood in the 1940s. What I find most striking about her
description is how many businesses our little section of town once had. There
was a grocery store, hardware store, two drugstores, a tailor, and more.

All of those businesses disappeared in the following decades. Families acquired cars and shopping migrated out to supermarkets and, later, malls and big-box stores. When I moved to the neighborhood in 2003, there were no businesses left
save one lone corner store. Meanwhile, scores of big-box stores and massive
shopping centers had grown up on the edge of town.

This transformation was not natural or inevitable. It was engineered by government policy. After World War II, federal and state officials poured money into highway construction, dismantled public transit, guaranteed mortgages in
the suburbs but not in the city, and enacted planning rules that insisted on a
rigid separation of residential and commercial uses. All of this created a
landscape ideal for chains and big-box stores, but inhospitable to local
businesses. In recent decades, municipal governments have gone even further,
doling out hundreds of millions of dollars a year in subsidies and tax breaks
that directly underwrite the construction of shopping centers and superstores.

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Most Americans, as well as a growing number of Europeans, now find themselves living in a built environment that is ill-suited to a post-carbon world—in part because it fails to support a local economy and in part because it demands an
extraordinary amount of driving. Between 1987 and 2007, total miles driven in
the U.S. rose 60 percent.

And this problem is self-reinforcing, because the landscape that the car has created only entrenches us ever more firmly in our role as consumers and erodes the social capital that enables communities to innovate and respond to complex
problems like global climate change.

To understand how planning policy affects civic life, all you need to do is spend some time watching people in a neighborhood business district or on a high street. What you see is lots of interaction. Business owners know their
customers; people run into neighbors on the sidewalk or while waiting in line
at the bakery. This is an environment that slows the pace of life and
encourages people to loiter and converse.

Then undertake the same observation in the parking lot of a big outside-of-town shopping center and watch how differently people behave in this setting. You see very little interaction. This is a landscape built for cars, not people.
The stores are sized to serve regions, not neighborhoods, so there's much less
chance that you'll bump into someone you know. And even if you do, the store
itself is designed to facilitate speedy consumption and deter loitering. This
is an environment that fosters separation and disengagement.

Indeed, studies show that, in places with many small, locally owned businesses, people are much more engaged in community life than those living in towns dominated by big businesses. Residents of communities with a vibrant local
business district are more likely to know their neighbors and to join civic and
social groups. They attend public meetings more often and even vote in greater
numbers than their counterparts in towns overrun by superstores.

This brings me to a theory I have about the growth of farmers’ markets. The conventional explanation is that people are rediscovering local food. That's certainly true. But I think people are as hungry for the community experience
as they are for the fresh broccoli. Several years ago, a group of sociologists
from the University of California-Davis followed people around as they shopped
in a supermarket. They found that your chances of having a conversation with
another shopper are about 1 in 10. They then tracked people at farmers’ markets
and found that your odds of having a conversation in this setting are nearly 70
percent. It's this social pleasure that I think is driving the very modest, but
noteworthy, regeneration of local businesses in some communities.

In my neighborhood, things began to change last year. First a restaurant opened and then a teashop. And then, like a gift from heaven, a small food market opened.
Stop by in the early evening and you'll find a row of bicycles parked out front
and the store's narrow aisles packed with people pondering their dinner options
and chatting with their neighbors.

This little store is not only a hub of social activity. It's also an economic engine of surprising proportions. Studies show that spending a dollar at an independent business generates about three times as much benefit for your local
economy as spending a dollar at a chain. The reason is that, unlike chains, which
siphon money out of a community, local businesses spend much of their revenue
buying goods and services from other local businesses. They bank at a local
bank, hire a local accountant, get their printing done at the local print shop.

My local food market stocks an extraordinary amount of food produced nearby—not only vegetables, but also locally made cheeses, yogurt, sauces, jams, biscuits, and breads. Because it's run by a local owner, this store can source from
dozens of small producers much more efficiently than Tesco or Wal-Mart, saddled
as they are with global distribution systems and a top-down command structure.
Local ownership enables a face-to-face economy. It closes the distance between
customer and owner, farmer and eater, manufacturer and user.

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Lastly, this little store is quite significant from a climate standpoint. One study in Seattle found that families living in neighborhoods that integrate small businesses with homes drive 26 percent fewer miles on average than those
living in areas that lack nearby stores.

But this local store and the others like it that have managed to survive are like little green shoots growing up in the cracks of a sidewalk. They are defying the odds in a planning system rigged against them. If we want to grow a
wh*** new crop of these kinds of businesses, we must rethink our planning
policies. We need to stop favoring the automobile at the expense of other forms
of transportation and stop green-lighting superstore development.

A growing number of cities in the U.S. are indeed prohibiting the construction of superstores, and some, like San Francisco, are restricting the proliferation of all types of chains. At the very least, we need to adopt a kind of
precautionary principle that places the onus on big retailers to demonstrate
that their stores will be a net benefit, both economically and environmentally.
We have enacted a policy like this in my home state of Maine, where large
stores no longer have the right to open, but may do so only after their
economic impacts have been independently evaluated and the community has
determined that the benefits outweigh the costs.

Stacy Mitchell is a senior researcher with the New Rules Project, a program of the Institute for Local Self-Reliance that challenges the wisdom of economic consolidation and works to advance policies that
build strong local economies. She is the author of the monthly bulletin
the Hometown Advantage and the book Big-Box Swindle: The True Cost of Mega-Retailers and the Fight for America's Independent Businesses, which was named one of the top ten business books of the year by Booklist.

This is an excerpt of a lecture delivered at the Bristol Schumacher Conference in Bristol, England. Full citations available here.

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