We need to build our Island self-reliance
Dr. Trevor Hancock
8 July 2020
Last week I discussed Professor Rick Kool’s point that we live on an island – but we don’t act as if we do. Almost all our food, all of our fossil fuels, much of our electricity and much else is imported. The implication is that we should think about how to be more self-reliant. This is only partly because we might have to manage on our own at some point if there is a major earthquake or a really serious pandemic (this is a mild one, in comparison with the Black Death or smallpox).
But there are other reasons for being more self-reliant. These include a stronger local economy, more control over the necessities of life, strengthened community collaboration across sectors and a more engaged citizenry. The Institute for Local Self-Reliance in the USA “champions an approach in which ownership is broadly distributed, institutions are humanly scaled, and decision-making is accountable to communities”. It believes “communities are healthiest when they possess the authority, capacity, and responsibility to chart their own course”.
Here in Canada, the Centre for Local Prosperity, based in Atlantic Canada, works with communities to help them begin a shift toward what it calls “an economy that is properly scaled for the place”. It proposes a new economic model based on ‘localization’ which has two cornerstones; ‘locally-owned’ and ‘import replacement’.
The idea of import replacement was proposed by the famed urbanist, Jane Jacobs, in her 1984 book Cities and the Wealth of Nations. Successful cities, she suggested, used their capacity for innovation to replace imports by manufacturing the product or providing the service locally. As a result, money does not leave the community, but circulates locally. Imagine if some of the money we spend on food or energy were spent locally, rather than being shipped off the Island to Canadian or foreign corporations and workers.
In 2018 the Centre for Local Prosperity released a study on the potential of import replacement for Atlantic Canada. They found that for the four Atlantic provinces “four out of every ten dollars spent leave the economy”, a concept known as economic leakage. The Centre undertook focus groups in many communities and in each one, they reported “participants told versions of the same absurd story: small communities send their products away, either for consumption or further processing, and then buy those or equivalent products back for their own consumption”.
This provides plenty of scope for import replacement, with considerable economic benefit. A 10 percent shift in demand towards local products and services, they estimated, would result in more than 43,000 new jobs, which would have re-employed more than a third of those who were unemployed at the time (2016). The GDP for the four provinces GDP would grow by $4.7 billion, with $2.6 billion in new wages and $219 million in new tax revenues.
The report looked at a number of positive examples in the Atlantic provinces, several of which were focused on local energy systems, and a couple on food system co-ops. They also stressed the importance of community conversations for creating “strong positive narratives” about the future direction for the community.
They identified barriers to local procurement, the main one being “the seemingly senseless regulatory nets that appear to bias government policy against locally-owned businesses and start-ups”, particularly in the form of institutional procurement policies (hospitals, schools etc.). Clearly these barriers need to be removed, and the Centre suggests that these institutions, as well as municipal governments, need to revise their “current goods and services procurement policies and switch to local purchasing in as many ways as possible”.
In addition, they proposed a range of approaches to creating more local self-reliance and a stronger local economy by focusing on and supporting locally owned, import-substituting businesses.
One way to begin, they suggested, is to establish a Community Import Replacement Working Group and undertake an inventory of economic leakage and import replacement opportunities. They also suggest putting ‘Buy Local’ campaigns ‘on steroids’ and identifying and supporting ‘import replacement champions’, including through crowd-funding and pre-selling and by using local credit unions.
The good news is that a number of initiatives like these are already underway in this region. I will discuss them next week.
© Trevor Hancock, 2020