Community wealth building: America's emerging asset-based approach to city economic development.
| Author | Kelly, Marjorie |
| Position | POLITICS OF PLACE/POLITICS FOR PLACES |
As political debates continue to rumble along in the UK around greater devolution and decentralisation--not to mention the need for a 'new economics' based on more democratic economic institutions--the British left might consider looking across the pond for inspiration, to developments occurring at the city level in the United States. Driven by the ongoing deterioration of U.S. social safety systems and the exhaustion of traditional redistributive policies, a growing number of innovative experiments and approaches point towards a possible alternative pathway forward for those seeking transformative social and economic change. As community activists and a rising generation of progressive mayors and city economic development professionals get to grips with entrenched poverty and inequality, a new bottom-up paradigm is beginning to emerge--a systems approach to economic development that promises to create an inclusive, resilient, community-based economy grounded in local, broadly held ownership. We call this new asset-based paradigm 'community wealth building'. (1)
The design challenge before us
The impetus behind these promising new developments is clear. The economy of the United States is failing the majority of its people. The number of people living in high-poverty areas has nearly doubled since 2000, despite the significant decline in concentrated poverty in the previous decade. If policymakers thought that they had begun to solve the problem of urban poverty, it has now returned with a vengeance. (2) The labour market has deteriorated across the nation. Those trapped in contingent work--including part time, temporary, and contract labour--now make up an alarming forty per cent of the workforce. Over the last three decades, wages have been stagnant for the bottom eighty per cent of Americans, even as the income of the top one per cent has more than doubled. There has been a hollowing out of lower-skilled, middle wage jobs that once provided pathways to economic security. (3)
When these statistics are broken down by race and ethnicity, the extent of the American economy's failings becomes even more astounding. African-Americans and Latinos are more than twice as likely to live in poverty as non-Latino whites. Among families headed by someone with a college-level education, the median wealth for a white family is ten times greater than for Black families, and about seven times greater than for Hispanic families. (4) This picture becomes more troubling when coupled with the fact that most babies born in the United States today are children of colour. The United States is only three decades away from becoming a 'minority-majority' nation. Many U.S. cities have already arrived at this demographic inflection point--including New York, Chicago, Philadelphia, and Cleveland.
The underlying economic trends will only worsen, unless we can answer the design challenge before us. Can we find ways to include those presently excluded from economic well-being? Can we design an economic system that builds the wealth and prosperity of all citizens?
This work necessarily and naturally begins at the local level, given the paralysis of national-level politics in Washington and the need to rebuild and re-envision a modern economy from the ground up. Remarkably, such a process is already well underway. In dozens of cities and communities across the United States, the answers we so desperately need are already appearing. Using a variety of innovative strategies, a new movement of communities is arising to confront head-on the seemingly intractable descent into an ever more unequal society. Breaking out of the silos that were once the norm of community and economic development, a diverse group of partners--from trade unions and 'anchor institutions' (such as hospitals and universities) to community organisations and progressive local business networks--are joining together to begin to build an inclusive and sustainable economy in which all can thrive.
This movement is about prioritising people, place, collaboration, and inclusion. It's aimed at creating broadly held wealth in the economy, as the necessary foundation of economic democracy. Rather than focusing solely on social safety nets and regulation--both of which remain necessary--the emerging movement adds a vital focus on assets. It's about building on locally rooted assets of many kinds, including networks and relationships and community strengths, as a means of generating wealth that is locally rooted and broadly shared. We call this transformative approach to economic development 'community wealth building'.
To describe it in the simplest terms, community wealth building is a systems approach to economic development that creates an inclusive, sustainable economy built on locally rooted, broadly held ownership. To give it more tangible form it may be helpful to tell a few of the stories of the growing community wealth movement.
Si Se Puede! is a worker-owned cleaning co-operative, launched by the non-profit Centre for Family Life, a programme of SCO Family of Services in New York City. The centre has taken up the co-operative model as a way to create good jobs, after twenty years of traditional approaches to creating job readiness. Since launching Si Se Puede! in 2006, the centre has created other worker co-operatives performing handiwork, childcare, and painting. To build on these successes, the centre joined a coalition, led by the Federation of Protestant Welfare Agencies that worked with city council leaders in a campaign that resulted in New York City allocating $3 million over two years to develop worker co-operatives. A new law also requires the city's economic development arm to track the level of municipal contracts awarded to co-operatives. These moves are part of New York Mayor Bill de Blasio's quest to address economic inequality, which he has identified as the most important issue of our time. (5) Because of these efforts, Cristina, an immigrant from Mexico and a single mother, who for years struggled to make ends meet house-cleaning, can do jobs in three to five hours and make the same amount she used to make working twelve hours. Cristina, now a worker-owner at Si Se Puede!, has seen her wages jump from around $7 to $20 an hour while also permitting a more flexible schedule that allows her to spend more time with her family.
Community wealth building efforts in Boston, Massachusetts have yielded similar results. It began when the non-profit Dudley Street Neighbourhood Initiative (DSNI) organized a 'Don't Dump on Us' campaign to get Bostonians to stop dumping rubbish in their low-income neighbourhood. With this community power base, DSNI was able to persuade the city to adopt the community's plan for revitalising the area, and to grant DSNI the power of eminent domain (a powerful form of compulsory purchase order). This enabled the non-profit to consolidate vacant land into a community land trust, whereby the community now owns the land and residents own affordable houses developed by the organisation. (6)
Community wealth building took a slightly different shape on the West Coast, in Portland, Oregon. Leaders in the Portland Development Commission (PDC) began to recognize how they themselves had contributed to a bifurcated community, in which some enjoyed prosperity while others fell victim to rising inequality and widespread economic hardship, much of it built on racial disparities. The city launched a Neighbourhood Prosperity Initiative, focused on six districts with high concentrations of people of colour and high poverty. In each district, community members worked with neighbourhood non-profits to create a vision for improving their local commercial areas, with the aim of fostering economic opportunity and neighbourhood vitality. Each district was given $1 million over ten years by the PDC to bring these visions to fruition. While the sums are relatively small, the initiative is an important pilot in what Kimberly Branam, Deputy Director of the PDC, called 'community-led development'. 'They literally are making the decisions on how to spend the funds', she said. The city is modelling an approach to development that is both inclusive in its aims and participatory in its methods.
Stories like these are just a few among many currently playing out across the United States. These stories matter, because they tell us that--in the interstices of the system and in the face of the economic challenges visited upon so many American communities--promising alternatives are emerging in the tools and approaches of community wealth building. They tell us that across the country, in more places than many would imagine, a new kind of economy is beginning to appear. It's an economy that, because of its fundamental design, tends naturally to create inclusion and prosperity for the many, not simply for the few. This work is only beginning to be widely recognized as a cohesive approach. Yet, as we describe below and in our 2015 report Cities Building Community Wealth, community wealth building is in fact a coherent, systemic approach to economic development--one that embodies a powerful set of common drivers, and offers a broad set of powerful strategies. In what follows we delineate some of the important aspects of this powerful alternative to development-as-usual.
Defining the new approach
Language is a potent force. Recent decades have seen a series of new phrases spark and catch fire--'impact investing'...
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