Is the Local Economy Too Local? Why Co-ops and Credit Unions Need a Broader Strategy

This is the first part in “The Checkerboard Revolution,” a series of commentaries about the new economy movement. The series will investigate different strategies for the movement’s growth.

This is a story about the revolutionaries next door. If you live in a place hard hit by recent economic decline, chances are you’ve got a few on your block. Don’t worry: You’re not going to catch these revolutionaries hatching a plot to topple the government or skulking around a factory to foment worker insurrection. You’re more likely to find them cultivating a plot in a new community garden or transforming an abandoned plant into a worker-owned and -directed business.

In short, they’re hardly Bolsheviks. But they are revolutionaries nonetheless, because at the core of their DIY innovations is the DNA of a socioeconomic system fundamentally distinct from the corporate capitalist system that dominates our world. If they succeed and their alternatives work where the old model no longer does, they’ll have accomplished what the Bolsheviks so miserably failed – the creation of a democratic, equitable, and sustainable world beyond capitalism.

But to do that, these revolutionaries need more than a pioneering spirit; they need a systemic strategy. In his book What Then Must We Do? Straight Talk on the Next American Revolution, author and activist Gar Alperovitz uses the checkerboard as a metaphor for the strategic approach emerging in the work of these everyday revolutionaries. The idea is that no single revolutionary organization or blueprint will step up to change the system. Rather, transformative models will pop up piecemeal across the map, as communities band together to innovate their ways out of economic woes.

According to Alperovitz, the struggle for economic dignity has gone local by necessity as the old tools of working-class empowerment, such as labor unions, have declined, and as corporations have captured the national political parties. From Jackson, Mississippi, to Oakland, California, everyday Americans have responded by banding together to find ways to democratize and reinvest local wealth: from community foundations that finance worker-owned co-ops to investment cooperatives that buy up abandoned buildings and rent them to locally owned businesses. Values of sustainability, self-reliance, and justice also mean many of the squares on this checkerboard are green, as neighbors have banded together to build their own solar arrays and put residents back to work in the process.

If we re-imagine Alperovitz’s metaphor as a living checkerboard comprised of organizational ecosystems, many more helpful insights emerge. Every good environmentalist knows that diverse ecosystems are more likely to survive a crisis than homogeneous ones. The checkerboard revolution takes advantage of a similar principle: With each of the squares on the board representing a distinct local ecosystem of post-capitalist alternatives, the strategy builds resilience into the emerging system. So even if one local system collapses, chances are others will survive to spread the seeds of change.

On the downside, the checkerboard revolution also means fragmentation. And as any good ecologist will tell you, chopped-up ecosystems have trouble keeping healthy. Just as biological species need space to grow and find the resources they need to survive, so institutional species like worker-owned cooperatives need plenty of space, capital, and social support to persist in the face of ruthless corporate competition and systemic shocks like the financial crash of 2008. At least for the time being, the lion’s share of our economy’s most vital resources – political, legal, and financial – are in the hands of corporate elites. And history is filled with examples of such capitalists surrounding and crushing revolutionary alternatives, as geographer David Harvey has noted.

The great challenge for checkerboard revolutionaries, then, is to find a way to preserve their rich diversity while overcoming the isolation that leaves them vulnerable.

One solution might be found in an idea ecologists have developed to address the problem of fragmentation: “ecological corridors,” which connect isolated habitats and permit species to move between them. Likewise, checkerboard revolutionaries might do well to establish networks connecting islands of innovation. These networks could allow political, legal, and financial resources to get to the places that need them most and allow successful institutional species the room to scale up.

This certainly is the type of thinking behind the New Economy Coalition and the Next System Project, two initiatives Alperovitz himself has been involved with. Both have helped to establish new connections among the multitude of “new economy” experiments that dot the map.

With such organizations now on the scene, the contours of a new revolutionary movement are beginning to take form. But for the most part, those contours remain hidden to the vast majority of people, and indeed their possible future forms remain unclear even to their most visionary champions. Because of their locally focused, bottom-up philosophy, checkerboard revolutionaries have tended to avoid conceptualizing how their various experiments could coherently fit together into an alternative to the corporate capitalist system. As I will discuss in a later post, there are in fact good reasons for this. But I will also argue that overcautiousness toward systems-thinking is a problem that change-makers can and must resolve.

Many critical questions abound for the new economy movement. What common challenges do those diverse local revolutionaries face as they seek to displace the old system, and what are the innovators doing to confront them? What kinds of networks should they build to allow for the flow of resources and the migration of institutional species? What kind of macro-level political institutions or policies do they need to advocate for? Will they need an entirely new brand of economics to guide their work?

These are the types of questions this series will examine. Check this spot next week for the second installment in the series, which will look at the California drought and what it can teach us about efforts to build a more democratic and resilient food system.