In Troubled Times, Taking Stock of Our Community Wealth

Posted by Steve Dubb on January 17, 2017

In the wake of the 2016 election, many have focused on the vote and the politics behind that vote. But it is important, too, to look to movement assets that might be available to mobilize to continue to build local economies in the face of an inhospitable federal government. And here there is some good news—namely, that the state of what I like to call community wealth building is much stronger today than in 2001 at the start of the Bush administration.

Community wealth building strategy, as I wrote in the Stanford Social Innovation Review, refers to the use of “community ownership of business and land to generate income-producing assets and build wealth in low-income communities over time.” The political point is that community-controlled economic institutions develop economic power that enables them to more forcefully promote policies that benefit their constituents. And it is not just policy: these community institutions provide mechanisms to employ community residents, purchase goods and services, and invest and allocate resources. In short, while one shouldn’t overstate this, there is at least some ability to work around policy obstacles, as well as push for supportive state and local policies, even, as Rick Jacobus noted, defensive battles will need to be fought.

Of course, our field has a mixed story to tell. Despite the growth of community institutions, communities are still suffering. Clearly, there has not been a full recovery from the Great Recession—this homeownership chart, for example, shows how far ownership rates remain below pre-recession levels.

But in thinking about how to face the current federal environment, it might be helpful to take stock of where gains have occurred. Among these growth areas are:

  • Community development financial institutions, or CDFIs. A recent report from the U.S. Social Innovation Forum noted that CDFI assets now total $121.6 billion, up from $64.3 billion in 2014. While the 89 percent increase may in part reflect an under-count in 2014, the long-term trend is unmistakable. In 2010, CDFI assets only totaled $41.7 billion, meaning those assets have nearly tripled in six years. In 15 years, CDFIs have grown by more than 15-fold. (By the way, this means that CDFIs tripled in size during the Bush administration too, despite repeated Treasury attempts then to wipe out the CDFI program).
  • Worker cooperatives have emerged from obscurity to being an important part of the community economic development discussion and increasingly obtain city support. As this 2016 study shows, at least 10 U.S. cities have supported worker co-op development. (The study cites Minneapolis, Minnesota; Austin, Texas; New York City; Rochester, New York; Richmond, Virginia; Cleveland, Ohio; Madison, Wisconsin; and Richmond, Oakland, and Berkeley in California). The number of worker co-op member-owners is minute (about 7,000 people nationally), but increasing; a third of worker co-ops have formed just since 2010, with a growing number of co-ops being conversions from family-owned businesses.
  • Participatory budgeting, a strategy that taps community members to decide where to spend public dollars in their neighborhoods, has also expanded greatly. Developed in Brazil in the 1980s, participatory budgeting was hardly used in the United States eight years ago. Today, it is being used in at least 16 cities across the United States. In New York City, residents using this process make decisions regarding over $33 million in capital project spending annually. 
  • Public land banks have evolved from a rare tool to control blight eight years ago to a practice that is employed by over 120 communities. Not all land banks support community wealth building goals, but, with community organizing they can, as this Shelterforce article about Philadelphia noted.
  • The past eight years have also seen hospitals and universities, typically public- or nonprofit-owned institutions, commit to using their resources to support their communities and adopt an anchor mission. In Baltimore, for example, Johns Hopkins has pledged to, among other actions, “increase spending with businesses, especially minority and women-owned businesses, in Baltimore City by $6 million over the next three years.”

This is not an exhaustive list. One could add the new focus of philanthropy, especially community foundations, to invest in place and address inequality. Or the thousands of “hybrid” businesses that embed social mission in their bylaws.

None of this is to deny that we face difficult times. The struggle for equity and inclusion and against racism and misogyny is critical and will not be easily won. But, against the odds, we have developed some economic and political capacity, and if we take stock of the assets that we've built, we will be able to apply them strategically.

(Image: From Stacy Bramhall, via flickr, CC BY-NC-ND 2.0)

About the author more »

Steve Dubb is senior fellow at The Democracy Collaborative, a U.S. nonprofit working to build community wealth. He is author of Conversations on Community Wealth Building, a collection of community development practitioner interviews, and, with Rita Hodges, The Road Half Traveled: University Engagement at a Crossroads.

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