Financing Our Foodshed (19 page)
Read Financing Our Foodshed Online
Authors: Carol Peppe Hewitt
But that promise is looking more and more like a fairy tale. Things are getting worse, not better. In the last decade we’ve seen a huge chunk of the wealth of the 99% shifted to the 1% through a well-rigged system. That money won’t be coming back for decades, if ever. And, as the threats loom larger, people may start making more decisions based on personal economic security — and fewer for the greater good.
So when the topic of investment comes up, the pull is to only want to maximize monetary gain. Slow Money suggests we look at
other equally
if not more important gains — like the survivability of our local food systems and long-term soil fertility.
It is worth noting that the children of the 1% do not escape getting confused about money. I saw this when I ran into a friend who had heard about my work with Slow Money. He had a large inheritance, and his late father’s business kept generating even more money. But
he was immobilized, wanting to do “the right thing” but unable to decide what that would be. He wondered if he should spend some on farm preservation, or incubator farms, or…? And he had been struggling with this for a while. I gave him a challenge. Go home, I suggested, and make a loan to a food entrepreneur in your community for $5,000, then call me. But even that made him feel conflicted because he owned homes in three places and didn’t know which one to choose. “I don’t care,” I said. “Just make a loan. Now.”
About three months later, I ran into him again. He was still quibbling. So I made a stronger plea. “Look,” I urged, “there is no reason you should let your wealth freeze you up like this. I know you can do this. Make a loan and give me a call.”
Two weeks later, he called. He was delighted. He’d made that first loan and was getting ready to make another. It wasn’t the amount that mattered, it was his ability to push past the fear of making a mistake. Last time we spoke, he had helped finance numerous ventures. One was instrumental in getting organic, locally grown, healthy snacks to public schools. And he’s now part of a much larger project as well.
If any of the ventures fail, his portfolio will scarcely notice. But for the people who got the loan — it will, most likely, make all the difference.
My friend is not alone. High net worth doesn’t only make life easier. Although an outsider looking up the class ladder might ask why anyone rich would ever have anything to complain about, having more than enough money can produce feelings of guilt, difficulty in trusting people, and a sense of isolation. But this is the side of the story we rarely hear. It has become politically incorrect to be critical these days of people based on their gender, race, age, etc. But it’s still ok to jab at “the filthy rich.”
Talking to people — whether rich or not-so-rich — about their feelings about money is like slipping around on an iceberg of their
psyche. Below the surface are feelings of inadequacy, panic about losing creature comforts, resentment for those who have more, and ambivalence or denial about those who have less. It’s hard to think about money clearly.
So how does one make rational, sensible, pragmatic, ethical choices about one’s money?
Taking a relaxed, thoughtful, altruistic approach to the subject of money may be a challenge, but that’s exactly what one needs to do when considering making a Slow Money loan.
We know money has power. So how should it be exercised? We vote with every dollar we spend, even the ones we pass on to others to spend for us, such as taxes, charitable donations, paychecks to employees, savings accounts, and stock market investments. So, when we make a Slow Money loan, what are we voting for?
Slow Money is for
nurture
capitalists, not venture capitalists. Like other forms of impact investing, Slow Money offers a return that is not solely financial. Instead, there is an added “social” return that comes from knowing your investments are strengthening community, preserving fertile soils, creating resilient local food systems, and preserving local capital. Slow money sends a message that is the exact opposite of the one we usually give our bankers and money handlers when, eyes closed, hands over our eyes, we shuffle our feet and mumble: “Make me as much money as you can, and I don’t care know how you do it.”
Slow Money is a lot more transparent, and it aspires to offer a more ethical approach. It’s a blend of capital preservation and modest financial return, augmented by a big dose of social and ecological perks.
Buying local is another obvious way to vote, especially if you narrow down the definition of “local” to mean locally owned small, independent businesses that sell products made within your area. We can seek out locally or regionally made goods (maybe even just US-made) whenever we can. And we can encourage the people we know to do the same. Michael Shuman, economist and author of an
excellent book on community financing,
Local Dollars, Local Sense: How to Shift Your Money from Wall Street to Main Street and Achieve Real Prosperity
cleverly calls this
import substitution.
As of the end of 2012, Slow Money NC has catalyzed 59 individual peer-to-peer loans to 30 farmers and food businesses, totaling over $600,000. Sixteen of those people formed an LLC to refinance a co-op grocery store. Several folks have made more than one loan, and a few of us have made a handful. We are a diverse crew, some in our twenties, some in our seventies, with various decades in between. We are male and female, of a variety of races and ethnicities. Add in the borrowers, and we are an even more interesting slice of humanity.
Each of us has our own unique viewpoint about money, but we share a common fascination with the concept of Slow Money.
As one lender said:
The appeal of Slow Money is that it cuts through the ideas formalized by the banking system and allows people with cash to inject it right into the community. The money stays local, developing local infrastructure, jobs and community, while at the same time providing needed cash flow at a super-low rate. Projects that might be rejected by a big bank become realistic when you place funding into the hands of the community.
Said another:
Growing up on a farm with hand-me-down clothes and rarely eating out, I did not learn how to spend money. I developed the habit of caution and a tendency to save rather than buy. Spending my personal money to go to back to school was the biggest risk that I have ever taken, and it has shown the greatest rewards. I learned that I can make really valuable investments in myself, and I am beginning to look around more to
see how I can make investments in things outside of myself that will enhance my well-being and the greater good.
That investor made a Slow Money loan to a friend who was expanding her food business; he wanted to support her effort partly because she buys her ingredients from farms like the one he grew up on.
I asked several of our Slow Money NC lenders about their economic backgrounds. Did they have enough — or more than enough — money when they were growing up? Has that stayed the same or changed? The vast majority said they were raised middle or working class. But they now all classified themselves as middle or upper-middle class.
One lender explained:
Both my parents came from working-class families and have always been strategic with their spending. They advised my brothers and me to stay out of debt, to be frugal and to embrace a long-term view of investing and saving. As my brothers and I began working in high school, my parents encouraged us to invest in stocks, mutual funds and bonds. The idea of responsible fiscal policy is very much ingrained. Now that I have a full-time job and more personal monetary security than at any time in my life, I must remind myself that I am no longer on a college student’s budget, nor under the financial restrictions of my parents. I am free to use money as I see fit and justify it to no one but myself. This is both a great feeling of liberation as well as a bit scary, because I have no one to blame if I find myself in debt and destitution.
One way he’s decided to exercise his freedom is by making two Slow Money loans. Still in his twenties, he chose to make one of his loans to another young adult he knew who was starting a food enterprise.
Gary Simpson, another loyal Slow Money NC lender, recalled:
My father was a blue collar, full-time factory worker, and my mother worked part-time as a grocery clerk to make ends meet. I remember getting a new pair of blue jeans and tennis shoes each school year that came with orders to be “worn gently” because they had to last the year. The one pair of Sunday dress pants and white shirt I owned seemed to last forever. (They must have been made of spandex.) “We can’t afford it,” was an often-heard phrase, so I learned early on to live within one’s means.
Because of my vocational choices, the most I ever grossed in a year throughout my work career was $38,000, when I held three jobs. I’ve lived lean all my life and saved in a disciplined manner with my retirement years in mind. I have now been retired for a couple of years, live alone on a modest pension from the Evangelical Lutheran Church in America, a small Social Security income, and a few annuities. I was able to pay off my mortgage last year, enabling me to now put that money to work in a manner that can be of assistance to others with minimal risk of losing principal and 100% guarantee of maintaining principles.
Another lender recalled about this family’s finances: “I never thought too much about ‘having enough money’ growing up, because we didn’t. I went into the military partly for the GI Bill for college.”
One person shared a story about the very direct connection he felt with his community’s finances:
My mother was the village treasurer and worked out of our house. I watched my neighbors march in and out of our humble home to pay their property taxes, and learned that it was a civic responsibility. We never grumbled about “rendering unto Caesar what is Caesar’s, and unto God what is God’s.” The box of church offering envelopes sat atop the little desk
in the living room right next to the village tax ledgers. I was taught that “God loves a cheerful giver” and understood that the village treasurer and Uncle Sam did, too. Paying one’s “fair share” was simply the right and proper thing to do, no matter how little or much one had.
Still another had this to say:
I was raised on a farm. My mother was born into a wealthy family that prioritized connection to the land, nature, service, travel and education. She passed these values on to us, prioritizing travel, educational experiences, community service and hard work on the farm over convenience and luxury.
She did not become a career woman like many women of her generation, instead choosing to raise five children of her own and many others, manage a homestead, immerse herself in community life, and teach art lessons. I do not have nearly the same financial resources as my mother, but I share many of the same values about how to spend it.
My mother has a sort of blind faith that can be very inspiring and also infuriating. My shopping trips with her always consisted of me trying to convince her not to buy things for other people. She loves to buy things for her grandchildren and provide food for people.
My father has worked very hard for many years to support our family and help all of us through college. He did not share her blind faith about “things working out.” He also spent very little on himself, but worried about money more than Mom. Neither of my parents taught me anything about managing money, investing or saving for retirement.
So why did these people choose to make a Slow Money loan — or even several loans?
One lender said:
It is obvious to me that our economy is on a course for self-destruction. We cannot continue to extract resources forever. I want to invest in efforts that are restoring the land, rebuilding communities and providing quality products and services that people need and love. My goal is not to make a killing, because that very word implies destruction and violence. I also enjoy having a personal relationship with the borrower. It simply feels good. My heart says yes.
Explained another:
I want to support the people we know in our local community. I believe in the importance of locally grown food, small farming, and local economy, so I started searching for local food networks and local investing options. I heard about Slow Money NC at the Carolina Farm Stewardship Association 2010 conference.
It’s an investment in our future — a way to put your money where your mouth is. With a loan to a farmer, we might “be taking a chance,” but so is everyone else that sends their money to traditional investment options. If I borrowed from someone I knew, I’d be pretty determined to pay them back!
Giles Blunden is a retired architect known for his pioneering work in solar homes, green building, and co-housing development. He and his wife, Ginger Blakely, loaned Lilly Den Farm enough to buy a much-needed skid steer. “We want to be supportive of local independent enterprises,” Ginger shared, “since we both have had small businesses in the community. Keeping money within the community just makes sense.”