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The Need for Local First Campaigns

Courtesy of the Business Alliance for Local Living Economies

Local First Campaigns are important efforts to preserve the vitality of a community's independent business sector, to counteract the negative results of absentee ownership, and to foster successful community economies.

Global Companies: Local Economies

The last two decades have seen sweeping changes take place in many American communities as big-box retailers and strip malls in once green pastures replaced the traditional locally owned shops on Main Street. Meanwhile, many local governments spent tremendous amounts of time and money trying to attract multinational corporations to build factories in their backyards. Unlike the owners of locally based businesses, the absentee shareholder owners of these new businesses have little knowledge of or concern for the consequences at the local level for action taken on behalf of the corporation (David Korten, Economies for Life, YES!, Fall 2002). Today we can see the tremendous impact global companies have had on local economies as decisions affecting local jobs, wages, and quality of life are made in distant boardrooms.

Communities have encouraged the expansion of national retailers based on the promise of job creation and sales tax generation. However, consumer spending is a relatively fixed pie. Sales gains at a new shopping development are invariably offset by losses at existing businesses. It's "a zero-sum game" according to Kenneth Stone of Iowa State University, who for more than a decade has tracked Wal-Mart's, and more recently Home Depot's, impact in Iowa. As local stores lose sales, they either downsize or close. The resulting job losses typically equal or even exceed the gains at the new superstore. The new jobs at Target or Wal-Mart, moreover, often pay less and offer fewer benefits than the jobs they replace. Taxpayers end up picking up the difference. Half of Wal-Mart's workers qualify for food stamps. Washington State reports that "Wal-Mart employees are the largest group of users in its taxpayer-funded low-income health care program" (Stacy Mitchell, Main Street News, February 2004).

Furthermore, In 1997 more than 40 states offered property tax abatements, loans for machinery and equipment, state revenue bond financing, accelerated depreciation, and special funds as incentives to help cities make deals (Michael Shuman, Going Local). Multinational corporations are mobile, however, and to cut expenses they increasingly move, leaving behind a trail of unemployment, abandoned property, and a diminished tax base. Local government is often left paying for the damage - in the form of unemployment compensation, higher welfare payouts, and diminished property taxes.

— Courtesy of the Business Alliance for Local Living Economies