Wednesday, January 11, 2012

Book Review #5: The Small-Mart Revolution by Michael H Shuman

In this fifth installment of my book review series is a little of what I was referring to in my last blog about expanding the horizons of this blog overall. Back in the fall, I had a chance to hear author, Michael H Shuman, speak at the Sustainable Cleveland Conference. With its witty name, I had heard of his "Small-Mart Revolution" for a few years, but had no conceptual idea of its breadth and scope (or even that Shuman was the author) until his speech where he interwove "far-out" ideas like local stock exchanges with a sense of reason and we-can-do-it enthusiasm.

The Small-Mart Revolution covers a lot of territory. There's a tale of irony that helps to make the book a pleasant read. However, at its soul is a somewhat fierce "Local First" mandate that manifests itself through the book in an epic battle called TINA vs. LOIS (though Shuman specifically states that the Small-Mart Revolution is not about us vs. them mentalities).

Throughout the book there are examples of how to integrate "Local First" into every day life and how to hopefully integrate it more into our future lives. There's some numbers in there, but nothing too daunting. A major take-home are multiplier effects to be discussed later. At about 75% in, Shuman uses an economic tool called "leakages" to determine to where money "leaks" out of a community. And then makes suggestions from the data to slow/stop such "leakages." Ultimately to me, this book is about the decentralization of power through the use and not-use of money.

Battle of TINA vs. LOIS

Right from the start, Shuman sets the stage for an ongoing battle between TINA and LOIS. These ladies are in reference to business, that for me can best be described as mindsets. TINA stands for "there is no alternative." TINA is desperation; whereas, LOIS means "locally owned, import substitution," and represents vision and hope. TINA is characterized as multi-national corporations who use false promises for abatements. TINA's new jobs are often highly visible to the public and often there's alot of them (like 400 new factory workers with benefits), which means politicians love TINA with all her ribbon-cutting ceremonies and such.

This means that TINA essentially steals abatement and investment dollars from LOIS, which doubly sucks because LOIS accounts for more jobs in the USA than TINA; and TINA could really care less about your clean lake or school system in a bottom line society.

Plus imagine all of the hassle going to a EZ Clean Green Drycleaning ribbon cutting, then to a new vertically-integrated, beet sugar rum, micro-distillery opening, then to the artesanal goat cheese place, then the small theater that does nothing but black and white films, and then to the vinyl record store that actually has local bands on new Cleveland-pressed vinyl. A politician's hand would hurt after all that ribbon cutting.

Buying Local First

This is the simplest of The Small-Mart Revolution's tenets. Lucky for farmer-me that buying and eating local foods is one of the easiest money changing aspects that people can embrace. Then there are other simple things like banking with a small bank or credit union or installing solar/wind power (in this regards you're in essence buying power from yourself, and thus decentralizing power). Walking or biking also count because the transportation industry is the most non-localized industry in the USA.

Then there's some medium-difficult paradigm-shifter suggestions like local rewards cards (see Supportland card above) or business-to-business lending. And then there's some truly wild style, future-forward, yet to be embraced, but it seems awesome ideas like local currencies and stock exchanges.

Multipliers and Leakages

So when you buy locally, there's this thing that's called the multiplier effect that happens afterwards. Basically, your money circulates around your community again and again in both dollar amounts and affected parties when you buy locally (stats in book). So it's totally worth waiting at Melt that extra 20 minutes with an extra beer in hand, than go to that lecherous Panera/Jimmy John's across the street; or go to Root Cafe, instead of Caribou.

From there, Shuman uses his economic tool of leakages in order to identify how and where-to money leaves a community. This is to identify and create future localized industries in areas that would ultimately have the most impact on the community/region. This is like a one, two punch for localness. One, you create new regional economic outputs. Then, two (and this is the proverbial pinball jackpot), you get those multiplier effects double-bonusing because of the subsequent dollar inputs. Thus creating a new, more self-sufficient community/region.


Throughout the book, there a ton of ideas, stats, and stories. In all honesty, I've been wanting to read this book for all of my adult life (though it hasn't existed for most of that time frame). I want to buy multiple copies and start a book club, go to Slow Money Cleveland meetings, and celebrate Cleveland's Slow Money already been accomplished-ments.

Therefore, I recommend it for any body who considers themselves a forward thinker, is looking for entrepreneurial business ideas, cares about their community, is in economic development/urban planning, likes economics, or is seeking an ideology in a hectic world.

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