General Electric says: “We will localise”

maersk contianer (2)

Last year came three reports on the downturn in global trade:

  • From the container industry: Søren Skou, chief executive of the Maersk Line, which carries goods and products between Asia, Europe, the US, Africa and Latin America and is now described as the only profitable freight line.
  • In a report from the Centre for Economic Policy Research: theslowdown in world trade has been much worse than previously reported, with global trade volumes plateauing over the past 18 months amid a rise in protectionism.

A higher proportion of the value of final goods is being added domestically

  • The World Bank: There is some evidence to suggest that part of the explanation may lie in shifts in the structure of value chains, in particular between China and the United States, with a higher proportion of the value of final goods being added domestically—that is, with less border crossing for intermediate goods. In addition, the post-crisis composition of demand has shifted from capital equipment to less import-intensive spending, such as consumption and government services.

china trade graphic

As politicians such as US Republican presidential candidate Donald Trump rail against “globalism” and promise to erect new barriers to commerce, policymakers and economists have also grown increasingly concerned about a slowdown in global trade growth. And according to the latest report by Global Trade Alert, which monitors protectionism around the world, that growth has disappeared altogether with the volume of goods traded around the world stagnant since January 2015.

Economists remain divided on the causes of the slowdown, some seeing long-term trends, including the shortening of global supply chains and the increasing role of digital trade. 

As the West Midlands Producers site notes, the reshoring trend, successes and possible pinch points, has been systematically explored and publicised by Aston Business School’s Professor David Bailey since 2013.

G20: mixed messages 

In their closing communique the G20 ministers last weekend reiterated a post-crisis pledge to avoid any move to protectionism, but ‘discriminatory measures’ such as local content rules and subsidies for local industry introduced by governments was up 50% in 2015 compared with the year before, according to the Global Trade Alert’s database – and G20 countries accounted for 81% of those measures.

The FT sees evidence that such measures are already having an impact on business decisions. In a speech in May at New York University, Jeff Immelt of General Electric said that faced with rising barriers to trade, a decision has been made to shift to a strategy of “localisation” rather than globalisation.

“In the face of a protectionist global environment, companies must navigate the world on their own,” said Mr Immelt. “This requires dramatic transformation. Going forward: We will localise.” 

 

 

 

Post-Brexit we need to build an economy for the many

‘Home-grown solutions’

neil mcinroyYesterday, Ann (West Midlands New Economics Group) sent a link to an article by Neil McInroy (right), chief executive of the Centre for Local Economic Strategies. CLES focusses on economic development and regeneration, ‘promoting and implementing new progressive economic activities which create positive environmental, health and social outcomes’.

It was recently published in the New Start magazine under the title given and a few highlights are offered here:

“Framed by austerity, the economic reality behind many voters choosing Brexit was a future of little promise – insecure jobs, insecure public provision, insecure futures. As a result, many leave voters felt that they had little or nothing to lose. On the back of an economic recession eight years ago, insecurity and a social recession has been built . . .

“Maybe the game is up now? Brexit may now consume the energies of Whitehall and the treasury. The rhetoric and promise of more devolution from Whitehall may at best slow, if not stop. We can hope for more and deeper devolution, but I suspect this is a forlorn hope. More importantly, there is a pressing task in reducing the existing pain and hardship and addressing deteriorating community relations and cohesion.

“In this, the local economic development community, local politicians and potential Metro mayoral candidates have a responsibility. They must strive to protect and build progressive economic and social policy. They must look toward home-grown solutions, and radical innovations across public, social and commercial sectors. They must adopt a pro-social approach to local economic development. This is less about treasury-backed local agglomeration policies, boomgoggling promises and trickle down. This is about stimulating local demand, social investment, addressing city-wide inequalities and the economics of social cohesion. Progressive local solutions are out there. We need to be bold in accelerating them.

“I would hope the newly-formed commission on inclusive growth . . . (will) use its influence to broaden its narrow growth-within-austerity remit, and explore how to build a truly democratic, inclusive and resilient economy within fairly-funded public services.

“The Brexit vote was in part prompted by a sense that people felt abandoned by the economy, and the state. This has created a new local economic and political reality, and with it come great dangers. As such we must avoid deepening the social recession and accelerating the divides between the haves and the have-nots. It is imperative that we now build an economy for the many and not just the few”.

Read the whole article here: http://newstartmag.co.uk/your-blogs/post-brexit-need-economy-many/

Update 2: International Alliance for Localisation

ial footer

In December this blog reported that Local Futures has gathered a cross-cultural, North-South network of thinkers, activists and NGOs – the International Alliance for Localization (IAL). It already has members from over 30 countries and Localise West Midlands is one of the member organisations.

This new cross-cultural network of groups and individuals focusses on resistance, renewal, and radically new visions of development and progress.

The response has exceeded IAL’s most optimistic expectations. In less than two months, individuals from 28 different countries have joined. These include farmers, teachers, builders, community organizers, environmental stewards, peace activists, homesteaders, students, health workers, business consultants, writers, engineers, artists, radio producers, researchers, and more.

Many organizations have also signed up: groups focused on social justice, ecological restoration, spiritual values, sustainable food and farming, holistic education, and policy research and advocacy. Among these are:

Swadeshi Jagaran Manch (India);

Digo Bikas Institute (Nepal);

Localize West Midlands (UK);

The Sustainability Institute and

Greyton Transition Town (South Africa);

Noakhali Rural Development Society (Bangladesh);

Centre for Global Justice (Mexico/USA);

Gaia Education (UK);

Holy Cross International Justice Office (USA);

Small Farm Training Center (USA), and many more.

.

This broad-based interest in the IAL shows that people worldwide are beginning to recognize that localization is a viable strategy for positive change on a global level.

Next: March 30th fourth webinar in the Global to Local Webinar Series: Debt and Speculation in the Global Economy, with Helena Norberg-Hodge and Charles Eisenstein

Sheffield and Balsall Heath: the real march of the makers

julian dobson2The observations of Julian Dobson (Living With Rats blogspot @juliandobson), strike a welcome and hopeful chord after reading the dismal question: “Will Chancellor Osborne cripple the ‘makers’?”

A search revealed JD’s substantial localist credentials – as director of Urban Pollinators, which helps to make sense of regeneration and the editorial director of New Start, the national magazine for regeneration practitioners. He is on the editorial board of the journal Local Economy and writes think tanks and publications such as the Joseph Rowntree Foundation, the Centre for Local Economic Strategies and Res Publica. He is helping to create Our Society, a social action network, and Revive Our Town Centres, a network for people involved in rethinking local high streets.

george osborne 2 smallerChancellor George Osborne closed his 2011 Budget speech by eloquently setting out his aspiration for “a Britain carried aloft by the march of the makers”. But recently he caused consternation by closing down the Business Growth Service, including the Manufacturing Advisory Service and the Growth Accelerator programme.

Julian observes that if there’s going to be a march of the makers, it is more likely to take the form of developments such as Portland Works in Sheffield, a stone’s throw from Sheffield United’s Bramall Lane ground, a development born of “a local determination to see Portland Works kept in use as a place for making”.

He relates that a community trust was formed when the previous owner wanted to cash in and convert the premises into flats: more than 500 people bought into a community share issue, reflecting the groundswell of support both for the works’ heritage and the trust’s vision of the future”.

portland works

Portland Works currently has 32 tenants with a wide spread of interest, including a knife maker, engraver, forge operator, several artists, a rug maker, a window maker, a distiller, bike-makers, woodturners, musicians and jewellers.

Though both are beset by the difficulties of maintaining an old building, a similar pattern can be seen in Birmingham (below, rear view) at The Old Print Works in Balsall Heath – first mentioned on this site in 2013 – where ‘makers’ work in low-cost spaces.

old print worksFollowing his account, Julian Dobson concludes:

“If there’s going to be a march of the makers, it is more likely to look like this than the kind of projects favoured by central government and its placemen in local enterprise partnerships, obsessed with projects that rejoice in titles like Catapult and Accelerator.

“It is likely to be a much slower march than the periodic stampedes of real estate and financial services speculators, too. But it has the potential to last far longer and to create more useful stuff in the process.

“And while there’s no doubt that the makers of Portland Works are having to rough it far more than government ministers and their acolytes might be used to, I’d hazard a guess that their work is both more creative and more fulfilling”.

Localism: a rescue plan for British democracy

A notable omission from Localise West Midlands’ extensive range of articles about, or with references to localism, is a review of a book by Simon Jenkins: Big Bang Localism: a rescue plan for British democracy.

big bang localismIn this book he attributes the decline in British voter interest and participation to the over-centralisation of power in Whitehall, ‘one of the most centralised governments in the West’. As turnouts in elections are dwindling, he notes, many are turning to ad hoc pressure groups and direct action.

Centralisation has not worked well, Jenkins believes; levels of satisfaction with health care, education and policing are lower in Britain than almost anywhere in the developed world. He notes a change in public opinion which once, on the whole, believed that the British government works well and is now shifting to a belief that it needs improving, citing contemporary YouGov polls showing a rise in discontent with public services and health care

Twelve years later the need to heed Jenkins’ pre Corbyn message has never been greater as the established on the political left and right frantically attempt to discredit and unseat a democratically elected party leader.

He noted that Britain’s local councillors are outnumbered three-to-one by 60,000 unelected people serving on roughly 5,200 local quangos, managing various functions that may be local but are no longer under local democratic control. Examples include health service, housing, prisons, training and economic development.

Jenkins points out that, across Europe, countries have spent the past two decades refreshing their local democracy – even traditionally centralised countries like France have devolved. The USA operates the most decentralised system of government and in these countries, public services are delivered more locally than in Britain – and win greater public trust as a result.

He sets out a programme for a ‘democratic Big Bang’, to return power to the local level, including control over health, police and education services, to re-enfranchise the British people:

Counties and cities should run:

  • health services
  • secondary schools
  • policing
  • the prison and probation services
  • youth employment and training
  • planning.

Municipalities and parishes should run whatever gives a community its pride and visual character:

  • primary schools
  • old people’s homes
  • nurseries and day-care centres
  • clinics and surgeries
  • parks and sports centres.

Local services should mostly be funded by local taxation, which should be raised from a combination of:

  • residential property tax
  • business rates
  • local income tax.

Jenkins proposes that central government funding of local services should take the form of a block grant, determined by the Local Democracy Commissioner and paid to local authorities with no strings attached.

The “enemies of localism” are vested interests and the national media, but devolution in Scotland and Wales shows that people prefer decisions about local services to be made locally. Simon Jenkins recommends that the Big Bang should start with a “bonfire of central controls” and an end to targets and official league tables, adding “Big Bang Localism is the answer to the failure of Britain’s public services and the loss of faith in British democracy”.

Update: International Alliance for Localisation

Early in December this blog reported that Local Futures has gathered a cross-cultural, North-South network of thinkers, activists and NGOs – the International Alliance for Localization (IAL). It already has members from over 30 countries and Localise West Midlands is one of the member organisations.

isec report coverIn the wake of the Paris climate talks, Local Futures has released a 16 page action paper entitled Climate Change or System Change? (left).

It argues that globalization – the deregulation of trade and finance through an ongoing series of “free trade” treaties – is the driving force behind climate change.

The climate problem can only be tackled effectively if governments stop subsidising globalisation, and begin pursuing a localisation agenda instead.

A recording of Local Futures’ first webinar, with community economist Michael Shuman and Helena Norberg is now uploaded on YouTube.

Climate Change or System Change? will be the focus of the second international webinar in January, as part of the Global to Local webinar series. More information will follow soon.

Contact via http://www.localfutures.org/contact-us/

 *

See in more detail: https://britain2020.wordpress.com/2016/01/03/localisation-a-systemic-solution-multiplier-simultaneously-lowering-co2-emissions-restoring-democracy-and-providing-secure-livelihoods-part-1/

Brief extracts from the 16 page action paper entitled Climate Change or System Change? – may be seen here: https://britain2020.wordpress.com/localisation-systemic-solution-multiplier-part-2/

 

Quantitative easing to fund climate change programmes?

finance murphy header

Colin Hines, co-founder of Localise West Midlands and Richard Murphy, Professor of Practice in International Political Economy, City University, London, warn that the Paris Climate talks are facing an enormous funding problem to which there is only one viable solution.

In a new report published by Finance for the Future, entitled ‘Climate QE For Paree’, they suggest that the measures to be put on the table in Paris will not go far enough to halt a disastrous global temperature rises of more than 2 degrees because no one has suggested how the enormous cost of tackling this issue is to be addressed, particularly at a time of global economic slowdown.

The paper offers a solution to this problem, using a variation on the idea of People’s Quantitative Easing that has received much attention during 2015:

The world has or is intending to print €7 trillion of quantitative easing to keep the financial system afloat​. In that case, why not use this mechanism in the form of Climate QE to save the planet?

The European Central Bank is already e-printing €60 billion a month under its QE [programme and is committed to doing so till September 2016.

If it allocated say €10 billion a month either from this QE programme, or from an additional QE commitment, it could use it to buy climate change bonds from the European Investment Bank. The EIB could then direct these funds to climate change programmes in both Europe and developing countries.

This could have a galvanising effect on other rich countries, putting pressure on them to introduce their own Climate QE initiatives and thus further bolster global funds towards the many hundreds of billions eventually needed to keep temperature rises at 2oC.

Importantly, since Climate QE involves one arm of the EU, the ECB, creating e-money and using it to buy assets from another arm of EU, the European Investment Bank (EIB), this will not increase Europe’s repayable debt levels. This would also hold true for countries like the United States and the UK, something that is crucial to making involvement in ‘Climate QE’ post Paris politically acceptable to all rich countries.

How the European Investment Bank Could Spend Climate QE

The EIB already invests around 10% of its funds in developing countries and prioritises climate change mitigation and adaptation (e.g. renewable energy, energy efficiency, urban transport and other projects that reduce CO2 emissions).

To achieve the goals likely to be set in Paris, Climate QE funding should be used by developing countries to fund low carbon emitting industrial and agricultural infrastructure and energy efficient buildings in cities. Such projects face difficulty attracting private finance, since the returns are harder to identify and the process of capturing and sharing them are more complex than normal investment programmes.

Rich Countries would benefit too

Colin Hines said:

‘Climate QE is not just for poorer countries. The economic and employment advantages of investing in energy efficiency and renewables is not only a way to generate economic activity in every city, town, canton and hamlet across Europe, but will also ensure our continent’s significant contribution to helping solve the biggest threat facing humanity, which is climate change.’

For further details contact:

Richard Murphy, Director of Finance for the Future LLP and Professor of Practice in International Political Economy, City University, London

Tel +44 (0) 1366 383500

Mobile +44 (0) 7775 521 797

And

Colin Hines, Convenor Green New Deal Group

Tel +44 (0) 20 8892 5051

Mobile +44 (0) 7738 164 304

International Alliance for Localization

ial logo

The International Alliance for Localization (IAL) is a new cross-cultural network of groups and individuals focused on resistance, renewal, and radically new visions of development and progress.

In less than two months, individuals from 28 different countries have joined. These include farmers, teachers, builders, community organizers, environmental stewards, peace activists, homesteaders, students, health workers, business consultants, writers, engineers, artists, radio producers, researchers, and more.

Many organizations have also signed up: groups focused on social justice, ecological restoration, spiritual values, sustainable food and farming, holistic education, and policy research and advocacy. (Below, farmers’ markets were pioneered in Britain and elsewhere by ISEC, which promotes locally based alternatives to the global consumer culture by writing, filming and practical action.)

farmers market - scandinavian or

Among these are:

Swadeshi Jagaran Manch (India);

Digo Bikas Institute (Nepal);

Localize West Midlands (UK);

The Sustainability Institute and Greyton Transition Town (South Africa);

Noakhali Rural Development Society (Bangladesh);

Centre for Global Justice (Mexico/USA);

Gaia Education (UK);

Holy Cross International Justice Office (USA);

Small Farm Training Center (USA), and many more.

This broad-based interest in the IAL shows that people worldwide are beginning to recognize that localization is a viable strategy for positive change on a global level.

 –

How and why has the community spirit evident in Stirchley and neighbouring Bournville developed?

stirchley baths 3

As the writer saw in the first hour over a hundred local people flocking into Stirchley’s restored Edwardian Baths, their new community hub, with more coming through the door as she left, she remembered one resident’s words in Stirchley online:

Stirchley is a unique community. It must be one of the only remaining Edwardian designed High Streets left in Birmingham still mostly populated by independent traders of all descriptions.

Around this high street are hundreds of affordable owner occupied households of all age groups and ethnicities.

Its residents generally display the old Brummie attributes of being amiable, tolerant and willing to work with each other.

It has parkland aplenty, great public transport routes and is as much alive at night as it is in the daytime.

change kitchenStirchley Baths is a Grade II listed building, built in 1910 and closed to the public since 1988. Birmingham City Council’s Cabinet approved plans to transform the building into a community hub in 2012. It has ‘re-emerged’ with a community hall, meeting rooms, cinema space and training rooms. Its café will be run by Change Kitchen, well-known in the city centre, an imaginative choice.

Stirchley groups who intend to use the hub include established leisure, karate, arts and crafts groups, heritage initiatives, film nights and the monthly Stirchley community market. Three enquiries have been received from couples hoping to have their wedding receptions there.

The question stands: how and why has the community spirit evident in Stirchley and neighbouring Bournville developed?

stirchley banner

More about Stirchley:

http://stirchleybaths.org/timeline/

https://stirchleyhappenings.wordpress.com/

http://stirchley.co.uk/onlineforum/index.php

https://ourbirmingham.wordpress.com/2015/11/25/tonight-see-stirchleys-restored-edwardian-baths-preserving-and-reinstating-many-original-features/ (pictures of the exterior)