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Community Wealth and the Post-COVID Economy

Community Wealth and the Post-COVID Economy

In 2018 I had begun campaigning for city councillor as a Community Wealth candidate, before major employment and life changes caused me to postpone my move towards public office. My platform was based on successful grassroots work done in communities much like mine; former manufacturing hubs wrestling with decades of offshoring and automation. Starting in 2008 in one of the most devastated parts of Cleveland, Ohio—with a workforce half comprised of ex-felons—the model for Community Wealth Building devised by think-and-do tank The Democracy Collaborative pulled and continues to pull hundreds out of poverty with dignified work. A larger version was exported to Preston, U.K., which has since cut unemployment in half and been named the Most Improved City in Britain. Many communities, from Wales to New York City, have since produced programs influenced by these initiatives, which I will describe shortly.

COVID 19 has already taken thousands of lives, and it is believed we are a full year away from a vaccine. Economically a large recession is practically guaranteed, and even a great depression is in the cards. Eventually the virus epoch will end and we will return to more conventional work schedules, yet the weak demand from supressed incomes has economists expecting the recovery to take many years. That we will need some kind of economic stimulus to get back to full strength is a given. The only question is: what kind?

Community Wealth is a term given to a number of democratic and decentralized strategies to help keep and grow wealth in a community, including cooperatives, worker owned enterprises, community land trusts, and public banks. The unique model developed by The Democracy Collaborative, however, integrates a few of these elements in a devilishly simple but ingenious way that should be talk of the town(s) right now. The structure has three core ingredients:

  1. Local Finance: credit unions, public banks, or the municipal piggy bank.
  2. Worker Cooperatives: independent businesses owned by their workers with democratic participation in the company policy.
  3. Existing Public Sector Enterprises: schools, hospitals, libraries, etc., all of which purchase large numbers of goods and services from outside organizations. Often, they purchase from large corporations beyond the community, the profits of which go to a small number of owners, who in turn tend to stash them in offshore tax havens.

The process is straightforward. Local finance is used to start local worker cooperatives that serve important needs in the community. When public sector enterprises require those services, instead of purchasing them from outside corporations they purchase from local worker cooperatives, putting the investment—and the profits—into the hands of many homegrown worker-owners. This not only helps stabilize quality local employment—the Democracy Collaborative calls the public investors “Anchor Institutions”—but it also puts the wealth directly into the hands of the many folks who will continue to spend locally and help the other enterprises in their area.

If the companies reach a significant level of success, a part of the revenue produced goes back into a cyclical fund which is used to expand the system. This is where Cleveland’s Evergreen Cooperatives are now, first having expanded their workforce, and now helping workers purchase existing enterprises to add to Cleveland’s cooperative network.

Potentially—though of course things get complicated once lobbyists become involved—Community Wealth Building could have bipartisan appeal. For the socialist, it includes worker control of production and elements of a planned economy through more coordinated investment. For the conservative, it fosters a decentralized economy rooted in independent enterprise, regulated by supply and demand. For the non-ideological pragmatist, it offers a high likelihood of improving both short and long-term economic outlooks.

Every sensible city council preparing for the Post-COVID recovery should be having a hard look at the Community Wealth Building model and its component parts. It should also influence our federal plan. A Right of First Refusal policy, for instance, gives workers first dibs on purchasing and taking over enterprises that are closing or changing hands. Between the recession and the wave of retiring baby boomer entrepreneurs, this could quickly generate thousands of new worker cooperatives across the country. An investment bank offering zero interest loans specifically for creating and expanding worker cooperatives, meanwhile, would deploy “cooperative capital” at a pivotal moment that would echo through our options in the decades to come.

From there we would have an array of ways to invest locally, put the wealth in the hands of the many workers and consumers our economies depend on, and grow vibrant communities. If we play our cards right we might not only recover from this pandemic, but come back stronger than we were before.

Colin Bruce Anthes is a Niagara-based artist, activist, and educator.

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