It’s that time of year again, the time when most of us dig down deep and spend as much money on as many people as we can possibly afford, or not afford, for that matter. It’s that glorious holiday season when otherwise sane men and women rise from their beds in the middle of the night to stand in line for the privilege of knocking some old lady to the floor in our effort to get our mitts on the last, half-priced, 50-inch whatever in some giant square coliseum of discount consumer combat. Just thinking about it makes me want to give thanks to the creator. Thanks, Sam Walton.
But in all seriousness, considering the pressure to spend that descends upon us this time of year, it should come as no surprise that the admonishment to “shop local” also grows loudest during this same period. But should we listen? Can such selective consumption really make a difference? Can searching out the ownership lineage of a gift shop or restaurant really improve the quality of our lives or our communities? The answer is a resounding yes, and in more ways than you may have imagined.
Let’s start with an obvious benefit to shopping local: Your money stays in your community, where it will be reinvested in local jobs and other local businesses. The numbers don’t lie. It’s like supporting ourselves when we make a purchase from a locally owned and operated company. Research shows that when you buy from a locally owned business instead of some national chain store or restaurant, your money is far more likely to be reinvested in other local businesses, including area farms and service providers. This local reinvestment is like an amplifier to your original expenditure and allows your dollars to keep having an economic impact far beyond your original purchase. Both the local economy and tax base are repeatedly expanded when we shop locally. And as a result, we end up with better schools, roads, parks and government services, just to name a few of the benefits.
The opposite is also true. When we make our purchases from a national, chain-owned discount store or some other type of out-of-market business, our money is quickly siphoned from our community. While it’s true that some dollars find their way back into the local economy by way of low-paying retail jobs created by the box stores, most don’t. Much of the money we spend with the national chains is shipped out of the local market to pay for products made in Asia and elsewhere. And that portion of our money that eventually becomes the profits for the national chains has no value on the local level. Such profits are quickly sucked away to out of state corporate headquarters where taxes are paid to other states, and what is left over is further dispersed to investors with no ties to our community at all.
And just as shopping local amplifies the economic impact of our purchases, shopping at the national chains triggers an even more powerful reaction that has a diminishing effect locally.
There isn’t much you can’t buy in a Walmart or Target store: groceries, clothing, appliances, gifts, pharmaceuticals, books, music, furniture, sporting goods, auto parts, electronics, toys, kitchen accessories, hardware, etc. You get the point.
While one-stop shopping sounds convenient, each of these categories of products represents a business category that in a healthy economy is serviced by at least one and often several competing locally owned stores, depending on the size of the town or city. Unfortunately, when the national big box stores and restaurants come to town and start shipping local dollars out of market, the diminishing effect usually causes all or at least most of the smaller stores that sell these products, along with the jobs they once provided, to disappear.
The national box stores’ size and buying power allow them to drive down manufacturing costs at their suppliers on a scale never before imagined in our history. This allows them to both purchase and resell merchandise at prices impossible for locally owned businesses to match at a profitable scale. While inexpensively priced products may sound like a good thing, in the long run few things are more expensive for a community. This unparalleled purchasing power is the first blow in the diminishing chain reaction that can destroy local economies. The more small businesses that shut down as the result of a box store’s arrival into a community, the more jobs that are lost. The more jobs lost, the more the local workers and newly unemployed feel the need to supposedly save money by purchasing their food and products at the chain discount stores, so the retail consolidation accelerates. Once most of the locally owned businesses have closed down and those employment and entrepreneurial opportunities have been lost, small communities in state after state begin to resemble the old mining towns of Appalachia where all paychecks were issued in company scrip that was only redeemable at the company store.
Following a big box invasion in larger towns and cities, the national chain-owned store may not be the only business left standing in the end, but its arrival still has a negative impact by wiping out many small businesses and jobs while shrinking the local tax base. An extraordinarily wealthy city like Boulder can withstand the national chain invasion much more effectively than its neighbors. In Boulder, people are willing and able to pay more to get exactly what they want. There is little sense of urgency among most of its residents to save money at all costs. Unfortunately, Boulder is an exception to many of the normal rules that govern most local economies, but even Boulder’s economy is enhanced still further when we shop local.
In one study after another, those analyzing the impact of Walmart’s invasion of America have come to this same conclusion. But Walmart is only the most visible predator on local economies, not the only one. All national chain-owned stores assist in the destructive export of local dollars that in turn weakens our communities. And this shouldn’t be startling. We have known that this nationalization and consolidation is bad for our towns and cities for nearly a century.
As poet, philosopher and shop-local advocate Wendell Berry has often pointed out, government —local, state and national — has an obligation to protect local economies from the powers exerted by giant national and international corporations. It has simply chosen not to do so recently.
In his 2001 essay that appeared in Orion Magazine, Berry wrote, “Aware of industrialism’s potential for destruction, as well as the considerable political danger of great concentrations of wealth and power in industrial corporations, American leaders developed, and for a while used, the means of limiting and restraining such concentrations, and of somewhat equitable distributing wealth and property. The means were: laws against trusts and monopolies, the principle of collective bargaining, the concept of 100-percent parity between the land-using and the manufacturing economies, and the progressive income tax. And to protect domestic producers and production capacities it is possible for governments to impose tariffs on cheap imported goods. These means are justified by the government’s obligation to protect the lives, livelihoods, and freedoms of its citizens.”
Many of these laws and processes, such as the Sherman Antitrust Act and collective bargaining, have existed since the late 1800s. The decision by governments to ignore them in favor of corporate interests is a much more recent aberration.
In 1944 Walter Goldschmidt, a California anthropologist, studied the impact of farm consolidation and industrialization on local communities by studying the similarities and differences of two towns, Dinuba and Arvin. His findings informed modern research on the impact of how national big box stores such as Walmart, Target, Kmart, Fred Meyer and others impact our communities.
Goldschmidt determined that over time, a few large industrial farms consumed all of the land around Arvin, whereas Dinuba held on to its many small family farms. He found that the small farmers continued to plow their money back into the local Dinuba economy, as opposed to the fewer industrialized farmers of Arvin who either banked their profits or shipped them to a home office elsewhere. As a result, Dinuba supported twice as many businesses as the corporate-farming Arvin. Arvin residents were found to have an overall lower standard of living despite their commitment to technological advancements in agriculture. Dinuba residents enjoyed more civic organizations, newspapers, recreation centers, parks, schools and even churches. Even the style of government in the two towns diverged. Small-farming Dinuba commonly made town decisions through popular vote. Arvin, on the other hand, had most of its decisions dictated to its residents by county and city officials.
Boulder County has approximately 300,000 residents who, based on an average family size of 2.54 persons and average spending per family of $749, are expected to spend around $88 million dollars this holiday season. If each of us were to purchase just 10 percent more of our gifts from locally owned businesses this year, it would create an $8.8 million shot in the arm for our local economy. What if we all spent half or even more of our holiday dollars with locally owned businesses? The infusion of cash in Boulder County would quickly translate into new jobs and a healthier tax base to pay for our many services. What if we spent most of our money locally every day of the year? Our goods might cost a little more at the time, but the benefit to each and every one of us would far outweigh our expenditures when it comes to our quality of life.
And one final thought for this holiday season. Buying online from out-of-state businesses may save you a few bucks largely because you can avoid paying taxes on the purchase, but the tax bucks you are saving are the same dollars that should have gone to help pay for our schools, our roads, our parks, and our government-provided services and social supports that all of us living in Boulder County need and use every day.
So, if you can’t find it on a local website or in a local store, do what you have to do. But if you can find it here, then please buy it here, for all of our sakes.
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