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The New Economic Development: Tackling Inequality by Building Community Wealth

Anne Field | September 3, 2015

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Inequality is one of the defining issues of our times, and many economic development efforts aim to address that challenge. Yet, too often, these top-down efforts fall short of truly lifting up and empowering disenfranchised communities.  And many communities don’t have the necessary capacity to create change on their own.

How do you go about engaging in economic development that helps low-income areas, involves local people in the process, creates jobs paying a decent wage, avoids the dislocation of many residents and shops, and helps to form a more vibrant community?

To answer that question, researchers at the Democracy Collaborative, a nonprofit research and advocacy center, looked at 11 economic development initiatives focused on community-wealth building. The initiatives range from worker cooperatives to family foundations, but they all share a dedication to engaging the community in the process and building capacity and empowerment at the local level, while taking advantage of external resources and skills.EducateAndEmpower

In a recently published report, Educate and Empower: Tools for Building Community Wealth, authors Keane Bhatt and Steve Dubb pinpoint 21 successful tactics used by these groups to create more inclusive economic development.

Here are just a few examples:

Incorporating classic community organizing tactics. In 2008, 10-year-old People United for Sustainable Housing (PUSH) Buffalo (pictured above) successfully lobbied to have $19 million from a utility rebate program for weatherization and retrofitting improvements shifted from more-affluent rate-payers, who had the upfront cash to pay for such improvements, to an initiative providing better insulation for low-income residents–and lowering their sky-high utility bills.

The idea sprang from that tried-and-true community organizing activity: knocking on doors. “We heard from the community, if we’re paying more than we can afford for our utility bills, let’s insulate our homes so we don’t have to pay so much,” says Clarke Gocker, director of policy and strategy at PUSH.

Thanks to a separate campaign that resulted in $112 million for moderate-income household weatherization in addition to the rebate money, PUSH has been able to retrofit about 350 low and moderate-income homes and provide living wage jobs for around 24 low-income workers by working with a local network of contractors.

Taking “learning journeys.”  When the Wellspring Collaborative, a worker-owned cooperative development group in Springfield, Mass., wanted to pinpoint its business plan a year ago, it organized a field trip to visit the Evergreen Cooperatives in Cleveland, a successful network of similarly-minded cooperatives that partners with local anchor institutions such as universities and hospitals. Wellspring representatives, including partners within local Springfield government, area universities, and hospitals, wanted to see firsthand how Evergreen had gone about identifying what goods and services to sell to universities and hospitals in the area. “It was important to see the businesses in action,” explains one participant.

The visit proved inspiring and instructive. After returning home, Wellspring members discovered the business with the most potential was providing upholstery services to institutions in the area, and created a worker-owned cooperative to provide those services. Wellspring is also working with the local jail, which offers vocational training workshops teaching upholstery, creating a defacto re-entry program for ex-offenders. It’s also planning to branch out into urban agriculture by selling fresh vegetables to those same universities and hospitals.

Focusing on youth development. The Dudley Street Neighborhood Initiative, a community planning group in Roxbury, Mass., includes 15 to 17-year-olds on their board of directors, literally giving them a seat at the table.  As the kids mature, some grow into important staff positions and, in some cases, state and city government officials with a distinctive approach to economic development. John Barros, former executive director of the initiative, was appointed Boston’s chief of economic development in 2014. “They’re making a long-term investment in people,” says co-author Bhatt of the initiative.

Anne Field in a freelance journalist that writes about social enterprise. A version of this article first appeared on her Forbes.com blog, “Not Only For Profit.” 

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